On May 17, 2018, the Company amended the lease for its headquarters in Watertown, Massachusetts. The original five-year lease for approximately 13,650 square feet of combined office and laboratory space was set to expire in April 2019. Under the amendment, the Company leased an additional 6,590 square feet of rentable area of the building, with a commencement date of September 10, 2018. The amendment extended the term of the lease for the combined space through May 31, 2025, and the landlord provided the Company a construction allowance of up to $670,750 to be applied toward renovations and improvements within the total space. On April 5, 2021, the Company further amended the lease to include an additional 1,409 square feet of rentable area of the building, through May 31, 2025, with a commencement date of July 1, 2021.

On March 8, 2022, the Company further amended the lease (i) to extend the term to May 31, 2028 for 13,650 square feet of laboratory and manufacturing operations space, with the landlord agreeing to provide the Company a construction allowance of up to $555,960 to be applied toward upgrades and improvements within the space; (ii) to rent an additional 11,999 square feet of office space within the building through May 31, 2028 (New Premises); and (iii) to terminate a portion of the lease comprising 7,999 square feet of office space in the building in accordance with its existing contractual term on May 31, 2025. The amendment also reinstated the Company’s right to extend the lease for the space it occupies after May 31, 2025 for one additional period of five years. Rent for the extension period would be at the fair market rent for comparable space in comparable properties in the Watertown area. During the second quarter of 2022, the Company recognized a $2.9 million increase to its lease liabilities and right-of-use (ROU) assets resulting from the lease amendment for the term extension of the laboratory and manufacturing operations space.

The lease for the New Premises commenced during the third quarter of 2022. The Company occupied the New Premises when the landlord substantially completed its construction for the space, after which the Company’s obligation to pay base rent began. The Company recognized an increase of $1.6 million to its lease liabilities and $1.7 million to its ROU assets resulting from the lease for the New Premises.

The Company previously provided a cash-collateralized $150,000 irrevocable standby letter of credit as security for the Company’s obligations under the lease, which will remain in effect through the period that is four months beyond the expiration date of the amended lease. The Company will also be required to pay its proportionate share of certain operating costs and property taxes applicable to the leased premises in excess of new base year amounts.

The Company identified and assessed the following significant assumptions in recognizing its ROU assets and corresponding lease liabilities:

As of December 31, 2022, the weighted average remaining term of the Company’s operating leases was 5.2 years and the weighted average discount rate was 5.84%.

Supplemental balance sheet information related to operating leases as of December 31, 2022 and 2021, respectively, is as follows (in thousands):


	December 31,		December 31,
	2022		2021
Other current liabilities – operating lease current portion	$	543	$	645
Operating lease liabilities – noncurrent portion		5,984		1,860
Total operating lease liabilities	$	6,527	$	2,505

Operating lease expense recognized was $1.2 million and $885,000, excluding $63,000 and $30,000 of variable lease costs, for the years ended December 31, 2022 and 2021, respectively, which consisted of $1.1 million and $606,000 for research and development expense, $0 and $112,000 for sales and marketing expense, and $58,000 and $167,000 for general and administrative expense, respectively, and were included in the Company’s statement of comprehensive loss. Cash paid for amounts included in the measurement of operating lease liabilities was $834,000 and $920,000 for the years ended December 31, 2022 and 2021, respectively.

The Company is a party to one finance lease for laboratory equipment, which expires in June 2023.

Supplemental balance sheet information related to finance leases as of December 31, 2022 and 2021, respectively, is as follows (in thousands):


	December 31,			December 31,
	2022			2021
Property and equipment, at cost	$	270		$	371
Accumulated amortization		(237	)		(205	)
Property and equipment, net	$	33		$	166

Other current liabilities – finance lease current portion	$	36		$	137
Other long-term liabilities		—			36
Total finance lease liabilities	$	36		$	173

The components of finance lease expense recognized during the years ended December 31, 2022 and 2021 included amortization expense of $133,000 and $151,000, respectively. Interest on lease liabilities was $12,000 and $23,000 during the years ended December 31, 2022 and 2021, respectively. Cash paid for amounts included in the measurement of finance lease liabilities included operating cash flows of $12,000 and financing cash flows of $137,000 during the year ended December 31, 2022. Cash paid for amounts included in the measurement of finance lease liabilities included operating cash flows of $23,000 and financing cash flows of $146,000 during the year ended December 31, 2021.

As of December 31, 2022, the weighted average remaining term of the Company’s finance lease was 0.5 years and the weighted average discount rate was 12.5%.

The Company’s total future minimum lease payments under non-cancellable leases at December 31, 2022 were as follows (in thousands):


	Operating Leases			Finance Leases
2023	$	910		$	37
2024		1,392			—
2025		1,494			—
2026		1,589			—
2027		1,637			—
Thereafter		693			—
Total lease payments	$	7,715		$	37
Less imputed interest		(1,188	)		(1	)
Total	$	6,527		$	36