9. Commitments and Contingencies

Leases

In December 2015, we entered into a First Amendment to a previous lease agreement (Amended Lease) to lease approximately 8,500 rentable square feet of office space in Radnor, Pennsylvania. This amended an existing lease agreement to replace leased premises of approximately 4,000 rentable square feet of office space, and we commenced leasing the larger office space in April 2016. Rent payments under the Amended Lease commenced June 1, 2016, with payment amounts escalating each April 1 thereafter through the end of the 62-month lease term. In December 2018, we entered into a Second Amendment to this lease agreement (Second Amended Lease) to lease approximately 22,500 rentable square feet of office space in Radnor, Pennsylvania. This Second Amended Lease amends our existing Amended Lease agreement to replace our existing premises of approximately 8,500 rentable square feet of office space, and we are expected to commence leasing the larger office space in April 2019. Rent payments under the Amended Lease are expected to commence October 1, 2019, with payment amounts escalating each April 1 thereafter through the end of the 78-month lease term.

In November 2018, we entered into a three-year operating lease agreement for approximately 1,000 square feet of office space in Madison, Connecticut, with no renewal options. Rent payments under this lease commenced on November 1, 2018, and increase each November 1. Prior to that and through October 2018, we leased this same office space under a lease agreement that expired in October 2018. Rent expense under these operating leases was $0.2 million, $0.3 million and $0.3 million for the years ended 2018, 2017 and 2016, respectively. All leases are non-cancelable.

Our annual future minimum lease payments under these leases are as follows (in thousands):


	Operating Lease Payments
2019	$	298
2020		807
2021		819
2022		807
2023		823
Thereafter		1,482
Total minimum lease payments	$	5,036

Employee Benefit Plan

We maintain a Section 401(k) retirement plan for all employees. Employees can contribute up to 50% of their eligible pay, subject to maximum amounts allowed under law. We may make discretionary profit sharing contributions, which vest over a period of four years from each employee’s commencement of employment with us. We have not made any discretionary contributions.

License Agreements

We are obligated to pay royalties pursuant to a license agreement with Purdue Neuroscience Company (Purdue) as a percentage of net product sales for direct licensed products, such as ganaxolone. The obligation to pay royalties expires, on a country‑by‑country basis, 10 years from the first commercial sale of a licensed product in each country. The agreement also requires that we pay Purdue a percentage of the non‑royalty consideration that we receive from a sublicensee and a percentage of milestone payments for indications other than seizure disorders and vascular migraine headaches not associated with mood disorders. Under the license agreement, we are committed to use commercially reasonable efforts to develop and commercialize at least one licensed product.

In March 2017, the Company and CyDex Pharmaceuticals, Inc. (CyDex) entered into a License Agreement and a Supply Agreement. Under the terms of the License Agreement, CyDex has granted us an exclusive license to use CyDex’s Captisol drug formulation system and related intellectual property in connection with the development and commercialization of ganaxolone in any and all therapeutic uses in humans, with some exceptions.

As consideration for this license, we paid an upfront fee which was recorded as research and development expense in 2017, and are required to make additional payments in the future upon achievement of various specified clinical and regulatory milestones. We will also be required to pay royalties to CyDex on sales of ganaxolone, if successfully developed, in the low-to-mid single digits based on levels of annual net sales. As of December 31, 2018, we have not met any additional milestones under the License Agreement and have not made any additional payments to CyDex other than the upfront fee.

Under the terms of the Supply Agreement, we are required to purchase all of our requirements for Captisol with respect to ganaxolone from CyDex, and CyDex is required to supply us with Captisol for such purposes, subject to certain limitations.