Facility Leases

12 Months Ended

Dec. 31, 2024

Facility Leases

Facility leases

14. Facility Leases

As of December 31, 2024, the Company had entered into two operating lease agreements and records rent expense on a straight-line basis over the effective term of each lease, including any free rent periods and incentives. As the interest rate implicit in lease arrangements is typically not readily available, in calculating the present value of the lease payments, the Company has utilized its incremental borrowing rate, which is determined based on the prevailing market rates for collateralized debt with maturity dates commensurate with the term of its leases.

Burlingame Lease

In January 2015, the Company signed an initial operating lease (the “Burlingame Lease”), effective February 1, 2015 for 8,138 square feet of office and laboratory space with a one year term located at 863 Mitten Road, Burlingame, California. Between January 2015 and September 2021, the Company entered into a series of lease amendments to increase the amount of leased space to 27,280 square feet and extend the expiration of the Burlingame Lease to January 2025. The lease agreement includes annual rent escalations. Under the Burlingame Lease and subsequent amendments, the landlord provided approximately $1.9 million in free rent and lease incentives. The Burlingame Lease is a net lease, as the non-lease components (i.e. common area maintenance) are paid separately from rent based on actual costs incurred. Therefore, the non-lease components were not included in the right-of-use asset and liability and are reflected as an expense in the period incurred.

As of December 31, 2024, all noncancelable rent payments under the Burlingame Lease had been made and no right-of-use asset under this operating lease remained. As of December 31, 2023, the right-of-use asset under operating lease was $1.1 million. The elements of lease expense under the Burlingame Lease were as follows (in thousands):

		Year Ended
	Statements of operations and	December 31,
	comprehensive loss location	2024		2023		2022
Costs of operating lease
Operating lease costs	Research and development, General and administrative	$	1,273	$	1,224	$	1,051
Costs of non-lease components (previously common area maintenance)	Research and development, General and administrative		471		420		351
Total operating lease cost		$	1,744	$	1,644	$	1,402
Other Information
Operating cash flows used for operating lease		$	1,892	$	1,839	$	1,695
Remaining lease term			0.1 years		1.1 years		2.1 years
Discount rate			8.0%		8.0%		8.0%

As of December 31, 2023, minimum rental commitments under the Burlingame Lease were as follows (in thousands):

Year Ended December 31 (in thousands)
2024	$	1,434
Total lease payments		1,434
Less: imputed interest		(60)
Total	$	1,374

South San Francisco Lease

On October 22, 2024, the Company entered into a sub-sublease agreement (the “South San Francisco Lease”), pursuant to which the Company sub-leased approximately 20,916 square feet of office and lab space. The sub-sublease has a term of three years commencing on February 21, 2025 with an option to extend at fair market value for an

additional 27 months.

The Company’s obligation for the payment of base rent for the Premises begins on the commencement date and will initially be $33,833 per month, up to monthly base rent of $47,200 during the third year of the sub-sublease. In addition to base rent, the Company is obligated to pay its proportionate share of taxes, insurance and operating expenses. In November 2024, the Company paid the Sublandlord $231,235 in prepaid rent, which shall be applied to the monthly base rent and the Company’s proportionate share of additional expenses for the first three months of the term of the sub-sublease.

Although the non-cancellable lease term commences on February 1, 2025, for purposes of determining the right-of-use asset balance, in accordance with ASC Topic 842, the Company used November 25, 2024 as the commencement date, the date on which the sublandlord granted the Company access to the premises. The sub-sublease is a net lease, as the non-lease components (i.e. common area maintenance) are paid separately from rent based on actual costs incurred. Therefore, the non-lease components were not included in the right-of-use asset and liability and are reflected as an expense in the period incurred.

As of December 31, 2024, the right-of-use asset under South San Francisco Lease was $1.1 million. The elements of lease expense under the South San Francisco Lease were as follows (in thousands):

		Year Ended
	Statements of operations and	December 31,
	comprehensive loss location	2024
Costs of operating lease
Operating lease costs	Research and development, General and administrative	$	46
Costs of non-lease components (previously common area maintenance)	Research and development, General and administrative		—
Total operating lease cost		$	46
Other Information
Operating cash flows used for operating lease		$	153
Remaining lease term			3 years
Discount rate			11.7%

As of December 31, 2024, minimum rental commitments under the South San Francisco Lease were as follows (in thousands):

Year Ended December 31 (in thousands)
2025	$	305
2026		486
2027	$	566
Total lease payments		1,357
Less: imputed interest		(235)
Total	$	1,122