In January 2018, December 2018, and February 2022 the Company entered into lease agreements for office space in London, United Kingdom. The leases entered into in 2018 both terminate in January 2023 and there were no options to extend the lease term. The lease entered into in March 2022 expires in February 2032 and there are no options to extend the lease term. The combined annual rental payments, including variable payments, under the lease agreements were $1.7 million in 2022 and $1.8 million in 2021. The Company also rented lab spaces in London in 2021, for which it made $0.2 million in payments in 2022 and 2021.

In March 2018, the Company entered into a lease agreement for office space in Boston, Massachusetts, United States, which terminated in September 2022. The annual rental payments, including variable payments, were $0.3 million in 2022 and $0.4 million in 2021. The Company subleased the space starting in August 2021, and recognized $0.2 and $0.1 million in sublease income in 2022 and 2021, respectively.

In July 2019, the Company entered into a lease agreement for office space in Boston, Massachusetts, United States, which commenced in January 2020. The lease terminates in September 2026 and has no options for term extension. The annual rental payments, including variable payments, were $1.2 million and $1.1 million in 2022 and 2021, respectively. The lease agreement includes annual rent escalation provisions.

As of December 31, 2022, the carrying value of the operating lease right-of-use assets in Boston and London was $8.1 million and the lease liabilities was $8.7 million. As of December 31, 2021, the carrying value of the operating lease right-of-use assets in Boston and London was $4.1 million and the lease liabilities was $4.3 million.

In December 2018, the Company leased manufacturing, laboratory, and office space in Fremont, California (the “Fremont facility” and the “Head Lease”) which terminates in May 2030. In May 2020, the Company committed to a restructuring plan whereby it ceased construction and build-out of the Fremont facility. In December 2020, the Company entered into a sublease agreement (the “Sublease”) with an unrelated third-party (the “subtenant”) whereby the Company subleased the entire Fremont facility to the subtenant. The Company accounts for the Head Lease and Sublease as two separate contracts. Both the Head Lease and Sublease were determined to be operating leases.

The Head Lease annual rental payments, including variable payments, were $3.2 million in 2022 and $3.1 million in 2021. The Head Lease includes annual rent escalation provisions. The Company was provided with 8 months of free rent. Subject to the terms of the Head Lease agreement, the Company executed a $3.0 million letter of credit upon signing the lease, which may be reduced by 25% subject to reduction requirements specified therein. This amount is classified as restricted cash on the consolidated balance sheets.

As of December 31, 2022, the carrying value of the Fremont Head Lease right-of-use asset was $8.8 million and the lease liability was $12.0 million. The Head Lease provides for up to $5.3 million in tenant improvement allowances to be reimbursed to the Company by the landlord. These tenant improvement allowances have been included in the calculation of the operating lease liability and are currently expected to be received in 2023. The Company continues to assess the expected receipt of the tenant improvement allowances and may remeasure the right-of-use asset and liability from time to time as facts and circumstances may change.

The Sublease commenced in December 2020 and is in force for the remainder of the Head Lease term. The Sublease provided for 12 months of free rent until December 2021. The sublease provides for cash base rent payments with an annual rent escalation provision. The subtenant is also responsible for paying all operating expenses associated with the Head Lease. The Sublease also includes pass-through of up to $5.3 million in tenant improvement allowances to the subtenant, subject to the Company being reimbursed for the allowances per the terms of the Head Lease. The Subtenant provided the Company with a $2.6 million security deposit, which may be converted to a letter of credit upon providing evidence of $2.6 million in construction expenditures. The Company accounts for the security deposit within other long-term liabilities.

In July 2020, the Company entered into a manufacturing and technology development master agreement for research and development and commercial production with AGC Biologics, S.p.A. (formerly MolMed S.p.A.) (“AGC”) pursuant to which AGC will develop, manufacture and supply certain viral vectors and conduct cell processing activities for certain Company development and commercial programs ("AGC Agreement").

The Company determined that the AGC Agreement contains an embedded lease as it includes a provision for manufacturing suites designated for the Company’s exclusive use during the term of the agreement. The AGC Agreement has an initial term of five years, beginning on the Effective Date and ending July 2, 2025. The agreement may be extended for an additional two years by mutual agreement of the Company and AGC. The Company does not deem it probable that it will exercise the option to extend as of December 31, 2022. The Company paid $2.5 million and $3.1 million in rental payments in 2022 and 2021, respectively. As of December 31, 2022, the carrying value of the embedded operating lease right-of-use asset was $5.8 million and the lease liability was $5.3 million. As of December 31, 2021, the carrying value of the embedded operating lease right-of-use asset was $10.7 million and the lease liability was $9.3 million.

Our facility leases described above generally contain customary provisions allowing the landlords to terminate the leases if we fail to remedy a breach of any of our obligations under any such lease within specified time periods, or upon our bankruptcy or insolvency. The leases do not include any restrictions or covenants that had to be accounted for under the lease guidance. The following table contains a summary of the lease-related costs recognized within operating expenses, and other information pertaining to the Company’s operating leases as of December 31, 2022 and 2021 (in thousands, where applicable):


	2022			2021
Fixed lease cost	$	7,693		$	7,701
Variable lease cost		1,602			1,696
Sublease income		(2,820	)		(2,746	)
Total lease cost	$	6,475		$	6,651

Other information
Operating cash flows used for operating leases	$	7,442		$	7,989
Weighted-average remaining lease term (years)		6.5			6.0
Weighted-average discount rate		8.5	%		8.7	%

Fixed lease cost represents the ASC 842 rent expense associated with the amortization of our right-of-use assets and lease liabilities. Variable lease cost are the amounts owed by the Company to a lessor that are not fixed, such as reimbursement for common area maintenance and utilities costs and are not included in the calculation of the Company’s operating lease right of use assets or operating lease liabilities and are expensed when incurred. Sublease income represents the straight-line recognition of base rent sublease income over the term of the Sublease, and recognition of pass-through operating expense costs per the terms of the Sublease.

During the year ended December 31, 2022, the Company obtained right of use assets valued at $6.1 million in exchange for

lease liabilities of $6.1 million. During the year ended December 31, 2021, the Company obtained $0.6 million in right of use assets in exchange for $0.6 million in lease liabilities.

As of December 31, 2022, future minimum base rent commitments under ASC 842 under the Company’s property leases were as follows (in thousands):


Due in:	Gross lease payments			Gross sublease receipts			Net lease payments
2023	$	6,517		$	(2,246	)	$	4,271
2024		6,972			(2,313	)		4,659
2025		6,035			(2,382	)		3,653
2026		4,809			(2,454	)		2,355
2027		3,774			(2,527	)		1,247
Thereafter		12,266			(6,432	)		5,834
Total future minimum lease payments	$	40,373		$	(18,354	)	$	22,019
Less: imputed interest		(14,703	)
Total operating lease payments	$	25,670