Commitments and Contingencies

12 Months Ended

Dec. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

On June 30, 2020, the Company entered into an amended and restated lease agreement (the "Amended and Restated Lease") for office and laboratory space located in San Diego, California, for the Company's new corporate headquarters. The Amended and Restated Lease supersedes in its entirety the original lease agreement for the Company's future corporate headquarters dated as of August 22, 2019. The Amended and Restated Lease has a lease term of approximately 12 years ("Lease Term"), unless terminated earlier. The Lease Term has an initial abatement period, and the initial base rent payable will be approximately $0.6 million per month following the abatement period, which amount will increase by 3% per year over the Lease Term. The Company has also received incentives from the landlord for tenant improvements. As of December 31, 2020, the underlying asset was available for use by the Company to construct tenant improvements and therefore, the Lease Term is considered to have commenced.

The Amended and Restated Lease is considered to be an operating lease, and the Amended and Restated Lease indicates the interest rate applicable to the lease is 12%, therefore the Company used a discount rate of 12% to calculate the present value of its lease payments over the Lease Term. As of December 31, 2020, the consolidated balance sheet includes an operating right-of-use asset of $39.9 million and an operating lease liability of $41.9 million. For the year ended December 31, 2020, the Company recorded $0.3 million in operating lease expense.

As of December 31, 2020, the approximate future minimum lease payments under the Amended and Restated Lease are as follows:


(in thousands)	Operating Lease
Year Ending December 31,
2021	$	—
2022	1,681
2023	7,844
2024	8,080
2025	8,322
Thereafter	68,257
Total operating lease payments	94,184
Less: Amount representing interest	(52,279)
Present value of operating lease payments	$	41,905

On June 24, 2014, the Company entered into a lease agreement for completed office and laboratory space located in San Diego, California. The office space under the lease is the Company's corporate headquarters. The lease commenced in two phases (in July 2014 and March 2015) at a combined total initial monthly rent of $24,100 per month. The leased property is subject to a 3% annual rent increase following availability. In addition to such base monthly rent, the Company is obligated to pay certain customary amounts for its share of operating expenses and facility amenities. The original lease provided for expiration on January 31, 2018, and the Company entered into subsequent amendments to the original lease to extend the lease term to mid-2021 and expand the size of the existing space. All other terms and covenants from the original lease agreement remain unchanged.

As of December 31, 2019, the consolidated balance sheet includes a $0.6 million operating right-of-use asset, and a $0.7 million operating lease liability in deferred revenue and other current liabilities. For the year ended December 31, 2019, the Company recorded $0.4 million in operating lease cost.