The Company leased its offices and laboratory in South San Francisco, California, or the South San Francisco Lease, under a 7-year noncancelable lease agreement that ends in June 2024 with a 5-year renewal option. In December 2020, the Company entered into an agreement to lease office and laboratory space in Brisbane, California, or the Brisbane Lease, with an affiliate of the South San Francisco Lease landlord. The contractual term of the Brisbane Lease began in November 2021, for a ten-year term, with the Company’s option to extend for an additional ten years. The Brisbane Lease includes a rent-free period of three months starting in November 2021 and a tenant improvement allowance of $10.8 million. The Company records the tenant improvement allowance as a reduction to the ROU asset, which reduces rent expense over the lease term. In connection with the Brisbane Lease, the Company maintains a letter of credit in the amount of $1.0 million, which is included in restricted cash on the consolidated balance sheet. In May 2021, the Brisbane Lease commenced when the Company’s tenant improvements started.

Concurrent with the execution of the Brisbane Lease, the Company entered into an agreement to terminate the South San Francisco Lease, immediately effective when the tenant improvements of the Brisbane Lease were completed in December 2021. The South San Francisco Lease and the Brisbane Lease are accounted for as one lease with two lease components. Accordingly, upon adoption of Topic 842, the total consideration for the lease was reallocated to each lease component based on standalone selling price. As the Brisbane Lease commenced in May 2021, $1.3 million of the consideration allocated to the Brisbane Lease was recorded as a liability as of January 1, 2021 when the deferred rent balance of the South San Francisco Lease was derecognized.

In November 2021, the Company subleased space that has no immediate needs for the Company’s operations for two years starting from December 2021 for the aggregate sublease payments of $3.4 million. The sublease income, while it reduces the rent expense, is not considered in the value of the right-of-use asset or lease liability. The Company’s sublease income was $0.1 million for the year ended December 31, 2021.

In connection with the Brisbane Lease, the Company recognized operating lease right-of-use assets of $21.0 million as of the commencement date in May 2021, and lease liabilities of $22.2 million. As of December 31, 2021, the operating lease right-of-use assets were $20.3 million and lease liabilities were $34.6 million in the consolidated balance sheet. The weighted average remaining lease term is 9.9 years.

The weighted average incremental borrowing rate used to measure the operating lease liability is 8.4%.

Operating lease cost for the year ended December 31, 2021 was $2.9 million. Variable lease payments for the year ended December 31, 2021 were $0.4 million. Rent expense for the year ended December 31, 2020 was $0.4 million.

Future minimum lease payments and related lease liabilities as of December 31, 2021, were as follows:

As of December 31:	(in thousands)
2022	$	4,203
2023		4,742
2024		4,907
2025		5,079
2026 and thereafter		32,833
Total undiscounted lease payments		51,764
Less: Imputed interest		(17,175	)
Total		34,589

The Company’s future undiscounted lease payments under non-cancellable operating leases (as defined by prior guidance) as of December 31, 2020 were as follows:

As of December 31:	(in thousands)
2021	$	618
2022		4,189
2023		4,756
2024		5,035
2025 and thereafter		38,332
Total		52,930

In November 2011, the Company entered into an exclusive licensing agreement, or the Stanford Agreement, with The Board of Trustees of the Leland Stanford Junior University, or Stanford, whereby the Company was granted an exclusive, worldwide, royalty-bearing, sublicensable license, under certain patent rights, or the Licensed Patents, to make, use, offer for sale, sell, import and otherwise commercialize products covered by the Licensed Patents for human or animal diseases, disorders or conditions. Under the Stanford Agreement, the Company made an upfront payment and is obligated to pay Stanford annual license maintenance fees, potential future milestone payments totaling up to $500,000, and royalty payments at a rate equal to a low single-digit percentage of worldwide net sales of licensed products. The Company did not achieve any milestones or make any milestone payments for the years ended December 31, 2021 and 2020.

In December 2016, the Company entered into a Sponsored Research Agreement with a not-for-profit entity to perform research on multiple sclerosis. The Sponsored Research Agreement was amended in March 2019. Under the terms of the Sponsored Research Agreement, as amended, the Company may receive up to $651,000 in funding. If, within 15 years of the end of the Sponsored Research Agreement, the Company files a marketing authorization application for a product treating multiple sclerosis, the Company will be obligated to pay milestone payments up to four times the amounts received under the Sponsored Research Agreement. The Company has received $590,000 in funding to date, including $135,000 received during the year ended December 31, 2021, which was recorded as interest and other income. No income was recognized for the year ended December 31, 2020.

In the normal course of business, the Company enters into agreements that contain a variety of representations and provide for general indemnification. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future. To date, the Company has not paid any claims or been required to defend any action related to its indemnification obligations. As of December 31, 2021, the Company did not have any material indemnification claims or guarantees that were probable or reasonably possible and consequently has not recorded related liabilities.