In August 2019, the Company entered a lease for laboratory and office space located at 830 Winter Street Waltham, Massachusetts with a term that expires on September 30, 2024, subject to certain renewal options, which are not deemed highly probable of renewal. The Company provided a letter of credit in the amount of $0.6 million as security for the lease which expires January 31, 2025. The cash securing the letter of credit of $0.6 million is classified as restricted cash on the consolidated balance sheet.

In April 2020, laboratory and office space also located at 830 Winter Street was secured through a sublease that commenced in June 2020. The expected term of the lease upon commencement was through March 2026, however, in October 2022 the lease was terminated.

On November 1, 2021, the Company entered a lease for laboratory and office space located at 880 Winter Street Waltham, Massachusetts with a term that expires on December 31, 2032. This lease commenced when the Company obtained possession of the underlying asset on October 28, 2022 at which time the Company recorded a right-of-use asset of $57.7 million and a corresponding lease liability of $53.5 million, which represents the present value of future payments under the lease. The discount rate used to calculate the net present value of future payments was the Company’s incremental borrowing rate at the Lease Commencement Date, which was 9.9%. At the time of lease commencement, prepaid rent of $4.2 million was reclassed to the right-of-use asset. The Company provided a letter of credit in the amount of $4.4 million as a security for the lease, which renews each calendar year up to but not beyond April 1, 2033. The cash securing the letter of credit of $4.4 million is classified as restricted cash on the consolidated balance sheet. Annual fixed rent payments of $7.6 million will commence on January 1, 2023 through the original term of the lease, subject to annual increases of 3%.

The following table summarizes the presentation in the Company's consolidated balance sheets of its operating leases (in thousands):


	As of December 31,
	2022		2021
Assets:
Operating lease assets	$	59,102	$	5,491

Liabilities:
Operating lease liabilities, current		3,681		1,651
Operating lease liabilities, net of current portion		53,013		4,392
Total operating lease liabilities	$	56,694	$	6,043

The following table summarizes the effect of lease costs in the Company's consolidated statement of operations (in thousands):


	Years Ended December 31,
	2022		2021
Operating lease costs	$	3,264	$	1,939
Short-term lease costs		332		-
Variable lease costs		1,551		1,224
Total lease costs	$	5,147	$	3,163

During the years ended December 31, 2022 and 2021, the Company made cash payments for operating leases of $2.0 million and $1.9 million, respectively.

As of December 31, 2022, future payments of operating lease liabilities are as follows (in thousands):


	As of December 31, 2022
2023	$	9,034
2024		8,928
2025		8,067
2026		8,309
2027 and thereafter		55,356
Total future payments of operating lease liabilities		89,694
Less: imputed interest		(33,000	)
Present value of operating lease liabilities	$	56,694

As of December 31, 2022, the weighted average remaining lease term was 9.7 years and the weighted average incremental borrowing rate used to determine the operating lease liability was 9.8%. As of December 31, 2021 the weighted average remaining lease term was 3.4 years and the weighted average incremental borrowing rate used to determine the operating lease liability was 8.0%.

The Company obtained the worldwide exclusive license to its foundational technology from The Brigham and Women’s Hospital, Inc. (or BWH). The license, as amended, grants worldwide exclusive use to the patent underlying the TargetScan technology in exchange for fees including development milestones and various royalties on product sales should they occur in the future.

In June 2018, the Company amended and restated an existing royalty agreement with one of its founders. Under the amended and restated royalty agreement, the Company agreed to pay the founder an aggregate royalty of 1% of net sales of any product sold by the Company or by any of its direct or indirect licensees for use in the treatment of any disease or disorder covered by a pending patent application or issued patent held or controlled by the Company as of the last date that the founder was providing services to the Company as a director or consultant under a written agreement in perpetuity. Royalties are payable with respect to each applicable product for a defined period of time set forth in the royalty agreement. The founder assigned his rights and obligations under the royalty agreement to one of his affiliated entities in January 2021.