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Commitments and Contingencies

9 Months Ended

Sep. 30, 2025

Commitments and Contingencies

Commitments and Contingencies

13. Commitments and Contingencies

The Company’s existing leases as of September 30, 2025 for its U.S. and Spanish facilities are classified as operating leases. During the quarter ended June 30, 2021, the Company renewed its Rockville, MD facility lease by entering into a Second Lease Amendment which extends the lease term for 63 months beginning on September 1, 2022 and ending on December 31, 2027 at stated rental rates and including a 3-month rent abatement. The Second Amendment also has options for a Tenant Improvement Allowance and a Second Extension Term. The Second Extension Term is offered at market rates and there is no economic incentive for the lessee, therefore the Company has determined that it is not part of the original lease term.

The Company also leases research and office facilities in Parets del Vallès, Barcelona, Spain for its 100 percent owned Theriva S.L. subsidiary. The lease that was in existence from December 2021 to December 2022 was a short term agreement with a 90-day termination notice provision that can be exercised by either party. On the closing date of the Acquisition, a sublease was executed for Theriva S.L. to lease research and office facilities at a new location in Parets del Valles (Barcelona) from the former owner of Theriva S.L. This lease was executed for an initial term to begin in January 2023 until October 2026, with an option to renew for an additional five years. On January 15, 2023, Theriva S.L. moved into the facilities and the new lease commenced and the prior lease terminated.

Operating lease costs are presented as part of general and administrative expenses in the condensed consolidated statements of operations, and were approximately $164,000 and $493,000, respectively, for the three and nine months ended September 30, 2025, and $158,000 and $474,000 the three and nine months ended September 30, 2024, respectively. For the Barcelona lease, the day one non-cash addition of right of use assets due to adoption of ASC 842 was $937,000.

A maturity analysis of the Company’s operating leases as of September 30, 2025 is as follows (amounts in thousands of dollars):


Future undiscounted cash flow for the years ending December 31,

2025			175
2026			606
2027			368
Total			1,149

Discount factor			(98)
Operating lease liability			1,051
Operating lease liability – current			(618)
Operating lease liability – long term		$	433

13. Commitments and Contingencies (continued)

Risks and Uncertainties

The uncertain financial markets, disruptions in supply chains, mobility restraints, and changing priorities as well as volatile asset values could impact the Company’s business in the future. The Company and its third-party contract manufacturers, contract research organizations, and clinical sites may also face disruptions in procuring items that are essential to the Company’s research and development activities, including, for example, medical and laboratory supplies used in its clinical trials or preclinical studies, in each case, that are sourced from abroad or for which there are shortages. In addition, tariffs imposed on or by countries where the Company conducts its research and development or where the Company obtains supplies could impact the prices it pays for goods and services. Further, although the Company has not experienced any material adverse effects on business due to increasing inflation, it has raised operating costs for many businesses and, in the future, could impact demand or pricing manufacturing of its drug candidates or services providers, foreign exchange rates or employee wages. The Company is actively monitoring the effects that these disruptions and increasing inflation could have on its operations.

As of the date of this filing, the U.S. federal government is experiencing a partial shutdown. While the SEC’s EDGAR system remains operational and the Company continues to meet its filing obligations under the Securities Exchange Act of 1934, as amended, the shutdown has resulted in limited availability of the SEC staff to review filings, issue comments, or declare registration statements effective. This may delay regulatory review processes and affect the timing of certain capital markets transactions. The Company has evaluated the potential impact of the shutdown on its financial reporting and operations and has determined that, as of the reporting date, there are no material changes to accounting policies, estimates, or internal controls attributable to the shutdown. The Company will continue to monitor developments and assess any future implications.

Through the Acquisition, the Company has operations in Spain related to conducting research and development, manufacturing, and clinical trials in Western European countries. The invasion of Ukraine by Russia, the war in the Middle East, and the retaliatory measures that have been taken, or could be taken in the future, by the United States, NATO, and other countries have created global security concerns that could result in a regional conflict and otherwise have a lasting impact on regional and global economies, any or all of which could disrupt the Company’s supply chain, and despite the fact that it currently does not plan any clinical trials in Eastern Europe or the Middle East, may adversely impact the cost and conduct of R&D, manufacturing, and international clinical trials of its product candidates.