Tempest Therapeutics, Inc. Commitments Disclosure
5. COMMITMENTS AND CONTINGENCIES
Facilities Lease Agreements—In January 2022, the Company entered into an 8-year office lease agreement for a 20,116 square feet facility in Brisbane, California (“Brisbane Lease”). The lease commenced in December 2022.
As of December 31, 2024 and 2023, the balance of the operating lease right of use assets were $8,643 and $9,952, respectively, and the related operating lease liability were $9,011 and $10,112, respectively, as shown in the accompanying consolidated balance sheets.
Rent expense was $2,244 and $2,738 for the years ended December 31, 2024 and 2023, respectively.
As of December 31, 2024, future minimum annual lease payments under the Company’s operating lease liabilities were as follows:
|
|
Total Commitment |
|
|
Year Ending |
|
(in thousands) |
|
|
2025 |
|
|
1,861 |
|
2026 |
|
|
1,926 |
|
2027 |
|
|
1,994 |
|
2028 and beyond |
|
|
6,410 |
|
Total minimum lease payments |
|
|
12,191 |
|
Less: imputed interest |
|
|
(3,180 |
) |
Present value of operating lease obligations |
|
|
9,011 |
|
Less: current portion |
|
|
(869 |
) |
Noncurrent operating lease obligations |
|
$ |
8,142 |
|
Related to this Brisbane Lease agreement, the Company entered into a letter of credit with a bank to deposit $388 in a separate account that is restricted cash to serve as security rent deposit. This amount is included in other noncurrent assets in the accompanying Consolidated Balance Sheets as of December 31, 2024.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2024 | Mar 27, 2025 | Showing above |
| 2021 | Mar 29, 2022 | |
| 2020 | Mar 29, 2021 | |
About Commitments Disclosures
Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.
Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.