Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. The Company believes there is no litigation pending or loss contingencies that could have, either individually or in the aggregate, a material impact on the Company’s financial statements.

The Company leases office space for its corporate headquarters located in Blacksburg, Virginia, under non-cancelable operating leases, which expire in May 2022 and August 2024 (Note 9). Rent expense is recognized on a straight-line basis over the term of the leases and accordingly, the Company records any differences between cash rent payments and the recognition of rent expense as a deferred rent liability.

Future minimum lease payments as of December 31, 2021, are as follows (in thousands):


Year ending December 31:
2022	$	377
2023		315
2024		213
Total future minimum annual payments	$	905

Rent expense was $0.3 million and $0.2 million for the years ended December 31, 2021 and 2020, respectively.

We enter into contracts in the normal course of business with third-party contract organizations for clinical trials, preclinical studies, manufacturing and other services and products for operating purposes. These contracts generally provide for termination following a certain period after notice and therefore we believe that our non-cancelable obligations under these agreements are not material.