| Basis of Presentation and Summary of Significant Accounting Policies | 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation and Use of Estimates The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and disclosures required by GAAP for annual financial statements have been omitted. In the opinion of management, all adjustments, consisting of normal recurring adjustments considered necessary for fair presentation, have been included. Interim financial results are not necessarily indicative of results anticipated for the full year. The preparation of the Company’s unaudited condensed financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities and expenses and the disclosure of contingent assets and liabilities in the Company’s unaudited condensed financial statements and accompanying notes. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may significantly differ from these estimates and assumptions. For the year ended December 31, 2021, significant estimates and assumptions include the fair value of the 2021 Convertible Notes, the fair value of the liability for the SVB Warrant, the fair value of the Company’s preferred and common stock and stock-based compensation. After December 31, 2021, significant estimates and assumptions include stock-based compensation and the value of lease liabilities and right-of-use lease assets. Summary of Significant Accounting Policies During the three months ended March 31, 2022, other than the policies described below, there were no changes to the Company’s significant accounting policies as described in Note 2 to the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Cash, Cash Equivalents and Restricted Cash The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets (in thousands):
March 31, December 31,
Cash and cash equivalents $ 188,572 $ 201,049
Restricted cash 1,734 687
Total $ 190,306 $ 201,736 Short-term Investments Short-term investments primarily consisted of corporate debt securities, asset-backed securities and treasury securities. The Company’s investments in securities are classified as current as they are available for use in current operations. The following tables summarize the short-term investments held at March 31, 2022 and December 31, 2021 (in thousands):
March 31, 2022
Amortized Gross Estimated
U.S. treasury securities $ 6,486 $ ( 3 ) $ 6,483
Asset-backed securities 10,770 ( 47 ) 10,723
Corporate debt securities 110,913 ( 717 ) 110,196
Total $ 128,169 $ ( 767 ) $ 127,402
December 31, 2021
Amortized Gross Estimated
Asset-backed securities $ 21,172 $ ( 25 ) $ 21,147
Corporate debt securities 117,140 ( 113 ) 117,027
Total $ 138,312 $ ( 138 ) $ 138,174 The following table summarizes contractual maturities of available-for-sale securities held at March 31, 2022 and December 31, 2021 (in thousands):
March 31, December 31,
Estimated Estimated
Due within one year $ 99,110 $ 94,085
After one but within five years 28,292 44,089
Total $ 127,402 $ 138,174 The Company determined there was no other-than-temporary impairment of any of its investments. Inventory Inventory includes raw materials, which are goods to be consumed directly or indirectly in production, work in process, which are goods in the course of production, and finished goods, which are goods awaiting sale. Inventory is recorded at the lower of cost or net realizable value. Costs are based on standard costs that are adjusted regularly to reflect current conditions so that at the balance-sheet date standard costs reasonably approximate costs under a first-in, first-out basis. Standard costs include acquisition and production costs. Raw materials include inventories that may be used in research and development activities, and such items are expensed as consumed or capitalized as property and equipment and depreciated. Inventory in the prior year’s financial statements have been reclassified to conform to the current presentation on the condensed balance sheets and condensed statements of cash flows. No subtotals in the prior year financial statements were impacted as a result. Leases The Company adopted Accounting Standards Codification (“ASC”) Topic 842, Leases (“ASC 842”), effective January 1, 2022. ASC 842 requires the Company to recognize on the balance sheet lease liabilities and corresponding right-of-use (“ROU”) lease assets for its operating leases where the Company is the lessee. The initial impact of the adoption is discussed below in the section titled “Recent Accounting Pronouncements—Adopted.” The Company determines if an arrangement is or contains a lease at contract inception. Lease liabilities represent the Company’s obligation to make payments under its operating leases. ROU lease assets represent the Company’s right to use assets under its operating leases. The Company determines the value of lease liabilities and ROU lease assets on a lease-by-lease basis. A lease liability is recognized at the commencement date of an operating lease based on the present value of the future lease payments over the expected lease term. A corresponding ROU lease asset is recognized at the commencement date of an operating lease based on the value of the lease liability, adjusted for any lease incentives received, any initial direct costs incurred and any lease payments made at or before the lease commencement date. The Company made a policy election to not recognize lease liabilities and ROU lease assets for operating leases with an expected lease term of twelve months or less. The Company calculates the present value of lease payments using the discount rate implicit in the lease, unless that rate cannot be readily determined. In that case, the Company uses its incremental borrowing rate based on information available at the date of lease commencement. The incremental borrowing rate is the estimated rate of interest that the Company would pay to borrow, on a collateralized basis, an amount equal to the lease payments over the expected lease term. After lease commencement, the Company measures its operating leases as follows: (i) the lease liability based on the present value of the remaining lease payments using the incremental borrowing rate determined at lease commencement; and (ii) the ROU lease asset based on the remeasured lease liability, adjusted for any unamortized lease incentives received, any unamortized initial direct costs and the cumulative difference between lease expense and amounts paid under the lease. Lease expense is recognized on a straight-line basis over the expected lease term. Any lease incentives received and any initial direct costs are amortized on a straight-line basis over the expected lease term. Variable lease payments such as those related to property taxes, insurance and common area maintenance are recognized as expense when incurred. Recent Accounting Pronouncements—Adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (“ASU 2016-02”), codified as ASC 842. ASC 842 requires the Company to recognize on the balance sheet lease liabilities and corresponding ROU lease assets for its operating leases where the Company is the lessee. The Company adopted this standard effective January 1, 2021 using the modified retrospective method by applying the new standard to all leases existing as of January 1, 2022 and not restating any prior comparative periods. The Company elected the practical expedients to carry forward its historical lease classification, not reassess whether any expired or existing contracts are or contain leases and not reassess initial direct costs for existing leases. On January 1, 2022, the Company recorded operating lease liabilities of $ 7.1 million, ROU lease assets of $ 6.4 million, and derecognized deferred rent of $ 0.7 million. The additional disclosures required by the standard have been included in the section above titled “Leases” and in Note 9. Prior comparative periods have not been adjusted and continue to be reported under ASC 840. Recent Accounting Pronouncements—Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments–Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables and available-for-sale debt securities. ASU 2016-13 is effective for the Company’s annual periods beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on its financial statements and related disclosures. 3. Fair Value Measurements For accounting purposes, fair value is defined as an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Observable inputs such as quoted prices in active markets. Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. When quoted market prices are available in active markets, the fair value of assets and liabilities is estimated within Level 1 of the valuation hierarchy. If quoted prices are not available, then fair values are estimated by using pricing models, quoted prices of assets and liabilities with similar characteristics, or discounted cash flows, within Level 2 of the valuation hierarchy. In cases where Level 1 or Level 2 inputs are not available, the fair values are estimated by using inputs within Level 3 of the hierarchy. None of the Company’s assets or liabilities are recorded at fair value on a recurring basis other than cash, cash equivalents and short-term investments. No transfers between levels occurred during the periods presented. The fair value of short-term investments is based on market prices quoted on the last day of the fiscal period or other observable market inputs. The following tables summarize the Company’s assets measured at fair value on a recurring basis as of March 31, 2022 and December 31, 2021 (in thousands):
March 31, 2022
Level 1 Level 2 Level 3 Total
Cash $ 20,800 $ - $ - $ 20,800
Money market funds 167,772 - - 167,772
U.S. treasury securities 6,483 6,483
Asset-backed securities - 10,723 - 10,723
Corporate debt securities - 110,196 - 110,196
Total $ 195,055 $ 120,919 $ - $ 315,974
December 31, 2021
Level 1 Level 2 Level 3 Total
Cash $ 26,037 $ - $ - $ 26,037
Money market funds 175,012 - - 175,012
Asset-backed securities - 21,147 - 21,147
Corporate debt securities - 117,027 - 117,027
Total $ 201,049 $ 138,174 $ - $ 339,223 4. Inventory Inventory consisted of the following (in thousands):
March 31, December 31
2022 2021
Raw materials $ 5,034 $ 2,565
Work in process 1,295 446
Total inventory $ 6,329 $ 3,011 5. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands):
March 31, December 31
2022 2021
Prepaid expenses $ 2,289 $ 3,715
Interest receivable 694 1,050
Current deposits 503 761
Total prepaid expenses and other current assets $ 3,486 $ 5,526 6 . Property and Equipment, Net Property and equipment, net, consisted of the following (in thousands):
March 31, December 31,
Useful Life 2022 2021
Equipment 5 years $ 5,279 $ 4,433
Computers and software 3 years 2,309 2,136
Leasehold improvements 5 years or less 1,111 1,041
Furniture and fixtures 5 years or less 83 75
Construction in progress N/A 580 574
Total property and equipment, gross 9,362 8,259
Less: accumulated depreciation ( 2,648 ) ( 2,187 )
Total property and equipment, net $ 6,714 $ 6,072 7 . Accrued Expenses Accrued expenses consisted of the following (in thousands):
March 31, December 31,
2022 2021
Accrued compensation and other employee benefits $ 2,180 $ 3,516
Accrued professional services 281 200
Accrued research and development expenses 39 41
Accrued other expenses 411 521
Total accrued expenses $ 2,911 $ 4,278 8 . Long-term Debt Silicon Valley Bank Loan In November 2019, the Company entered into a loan and security agreement with Silicon Valley Bank (“SVB”) pursuant to which SVB agreed to lend to the Company up to $ 15.0 million in a series of term loans (the “2019 SVB Loan”). Contemporaneously, the Company borrowed $ 2.5 million in the first of three draw-downs available under the 2019 SVB Loan. In March 2020, the Company borrowed an additional $ 7.5 million as a second draw. The 2019 SVB Loan was to mature on September 1, 2023 and bore interest at an annual rate equal to the greater of (i) 0.65 % above the prime rate or (ii) 5.90 %. Payment on the 2019 SVB Loan was for interest only through September 30, 2021. In addition, a final payment equal to the original principal amount of each advance multiplied by 5.50 % was to be due on the maturity date. In connection with the 2019 SVB Loan, SVB entered into the SVB Warrant agreement with the Company to purchase shares of Series B convertible preferred stock at an exercise price of $ 2.3228 per share (see section titled “SVB Warrant” below). On September 30, 2021, the Company refinanced its 2019 SVB Loan. In connection with the refinancing, the Company entered into an Amended and Restated Loan and Security Agreement (the “Amended Agreement” or “2021 SVB Loan”, together with the 2019 SVB Loan, the “SVB Loans”) with SVB. The Amended Agreement provides for term loans in an aggregate principal amount of up to $ 35.5 million to be delivered in three tranches. The tranches consist of: (i) a term loan advance to the Company in an aggregate principal amount of $ 10.5 million on the loan closing date (the “First Tranche”); (ii) an additional term loan advance available to the Company through September 30, 2022 in an aggregate principal amount of $ 15.0 million; and (iii) subject to SVB’s approval, a right of the Company to request that SVB make an additional term loan advance in an aggregate principal amount of $ 10.0 million. The proceeds from the First Tranche were used to repay in full the existing indebtedness under the 2019 SVB Loan. The 2021 SVB Loan matures on September 1, 2026 and bears interest at an annual rate equal to the greater of (i) 0.75 % plus the prime rate as reported in The Wall Street Journal and (ii) 4.00 %. As of March 31, 2022 , the SVB Loan bears interest at an annual rate of 4.25 %. The 2021 SVB Loan has an initial interest-only period of 36 months. In addition, a final payment (the “Final Payment Fee”) equal to the original principal amount of each advance multiplied by 4.00 % will be due on the maturity date. The Final Payment Fee is recorded in other noncurrent liabilities on the balance sheet. As of March 31, 2022, the SVB Loan is recorded as noncurrent. The Amended Agreement was accounted for as a debt modification, rather than an extinguishment, based on a comparison of the present value of the cash flows under the terms of the debt immediately before and after the amendment, which resulted in a change of such cash flows of less than 10%. Unamortized debt issuance costs as of the date of modification and incremental issuance costs incurred in connection with the Amended Agreement will be amortized to interest expense using the effective interest method over the repayment term. As of March 31, 2022 and December 31, 2021 , the debt issuance costs related to the SVB Loans were $ 0.6 million. Debt issuance costs include the initial fair value of the SVB Warrant. The debt issuance costs are amortized to interest expense over the term of the loan using the effective interest method. The SVB Loans and unamortized discount balances as of March 31, 2022 and December 31, 2021 are shown below (in thousands):
March 31, December 31,
2022 2021
Long-term debt $ 10,500 $ 10,500
Less: issuance costs ( 559 ) ( 596 )
Total long-term debt, net of issuance costs 9,941 9,904 Future minimum payments of outstanding principal and interest under the 2021 SVB Loan are as follows:
As of March 31, 2022
2022 (nine months remaining) $ 340
2023 452
2024 2,194
2025 5,523
2026 and thereafter 3,976
Total future minimum payments 12,486
Less: interest, Final Payment fee ( 1,986 )
Long-term debt 10,500
Less: issuance costs ( 559 )
Long-term debt, net of issuance costs $ 9,941 The Company is subject to customary affirmative and restrictive covenants under the Amended Agreement. The Company’s obligations under the Amended Agreement are secured by a first priority security interest in substantially all of the Company’s current and future assets, other than intellectual property. The Company has agreed not to encumber its intellectual property assets, except as permitted by the Amended Agreement. The Amended Agreement provides for events of default customary for term loan facilities of this type, including but not limited to: non-payment; breaches or defaults in the performance of covenants or representations and warranties; bankruptcy and other insolvency events of the Company; and the occurrence of a material adverse change as defined in the Amended Agreement. After the occurrence of an event of default, SVB may, among other remedies, accelerate payment of all obligations. As of March 31, 2022 and December 31, 2021, the Company was in compliance with all covenants under the Amended Agreement and there had been no events of default. SVB Warrant In November 2019, simultaneously with the first draw-down under its 2019 SVB Loan, SVB entered into a warrant agreement with the Company to purchase 32,289 shares of Series B convertible preferred stock of the Company at an exercise price of $ 2.3228 per share (as amended, the “SVB Warrant”). In March 2020, in connection with the Company’s second draw-down under the 2019 SVB Loan, the SVB Warrant was amended to increase the number of shares of Series B convertible preferred stock of the Company by 96,867 , to a total of 129,156 shares. In connection with the completion of the Company’s IPO, in accordance with the original terms the warrant instrument, the SVB Warrant was automatically adjusted into a warrant to purchase an equivalent number of shares of common stock. In June 2021, after the IPO, SVB net exercised the SVB Warrant into 117,088 shares of common stock of the Company, and the SVB Warrant is no longer outstanding as of March 31, 2022. The fair value of the SVB Warrant liability was remeasured at each financial reporting period with any changes in fair value recognized as other income (expense) in the statements of operations. The fair value for the warrant liability for the SVB Warrant was based on the Black-Scholes option pricing valuation model using significant inputs not observable in the market and was thus classified within Level 3 of the fair value hierarchy. The change in fair value of the warrant for the three months ended March 31, 2022 and 2021 was $ 0 and $ 2.2 million, respectively, and recorded as “Change in fair value of warrant liability” in the statements of operations. When, in connection with the IPO, the SVB Warrant was automatically adjusted into a warrant to purchase an equivalent number of shares of common stock, the warrant liability was reclassified from current liabilities to equity as the warrant met the definition of an equity instrument. Additionally, at that time, the Company recorded the final valuation of the warrant liability for the SVB Warrant. The assumptions used in determining the fair value of the SVB Warrant liability are described in Note 3 to the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. 2021 Convertible Notes In February 2021, the Company sold and issued approximately $ 130.5 million aggregate principal of 2021 Convertible Notes in a private placement transaction. Of this amount, $ 48.5 million was to certain investors affiliated with members of the Company’s board of directors. The 2021 Convertible Notes accrued 6 % interest per annum. The Company elected as of the issuance date to account for the 2021 Convertible Notes at fair value. Management believes that the fair value option better reflected the underlying economics of the 2021 Convertible Notes, which contained multiple embedded derivatives. Under the fair value election, changes in fair value are reported as “Change in fair value of convertible promissory notes” in the statements of operations in each reporting period after the issuance through the conversion of the 2021 Convertible Notes. The Company measured the fair value of the 2021 Convertible Notes using the probability weighted “as-converted” plus Black-Scholes option pricing model based on inputs such as the probability of IPO vs. non-IPO scenarios, fair value of the common stock price, discount yield, risk-free rate, equity volatility, expected term, number of converted shares and price negotiation adjustment for the calibration. In connection with the IPO, the 2021 Convertible Notes converted into 7,531,777 shares of the Company’s common stock. Based on the terms of the agreement, the 2021 Convertible Notes converted at a 20 % discount to the public offering price in the IPO. At the time of the conversion, the Company recorded a final fair value adjustment of the 2021 Convertible Notes using the Company’s common stock price at the IPO. The assumptions used in determining the fair value of the 2021 Convertible Notes are described in Note 3 to the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. 9 . Commitments and Contingencies Columbia License Agreement and Sponsored Research Agreement In 2016, the Company entered into an Exclusive License Agreement (the “License Agreement”) with The Trustees of Columbia University (“Columbia”). Under the License Agreement, the Company acquired the exclusive right to use certain patents, materials and information. The License Agreement includes a number of diligence obligations that requires the Company to use commercially reasonable efforts to research, discover, develop and market Patent Products and/or Other Products (as defined in the License Agreement) by certain dates. Under the License Agreement, the Company pays an annual license fee that increases each year, until it reaches a low six-digit fee for the fifth year, and for each subsequent year, for so long as the License Agreement remains in force. The license fee was immaterial for all periods presented. For any products within the scope of the License Agreement that the Company commercializes, the Company is required to pay royalties ranging from low to mid-single digits on net sales of Patent Products and low single-digit royalty rates on net sales of Other Products. The Company can credit the yearly annual license fee against any yearly royalty fees payable to Columbia. Additionally, if the Company receives any income in connection with any sublicenses, the Company must pay Columbia a high single-digit percentage of that income. Finally, the License Agreement provides for payments to Columbia based on the Company's achievement of certain development and commercialization milestones, which could total up to $ 3.9 million over the life of the License Agreement. During the three months ended March 31, 2022 , the Company paid $ 0.1 million to Columbia pursuant to the terms of the License Agreement. In addition to the License Agreement, the Company entered into a sponsored research agreement to fund a research program with Columbia. The program ended in 2019. Operating Leases Overview of Operating Leases In November 2017, the Company entered into a non-cancelable operating lease in La Jolla, California, that expires upon commencement of the New HQ Lease, as defined below, which is estimated in May 2022. The lease includes certain rent escalations and additional charges for common area maintenance and other costs. The Company gained access to the leased space and began recognizing rent expense under this lease in February 2018. In December 2019, the Company entered into a 5-year lease agreement for additional office space in San Diego, California. The lease includes certain rent escalations and additional charges for common area maintenance and other costs. The Company gained access to the leased space and began recognizing rent expense under this lease in January 2020. In June 2020, the Company entered into a sublease agreement for an additional office space in San Diego, California. The sublease includes certain rent escalations and additional charges for common area maintenance and other costs. The Company gained access to the leased space and began recognizing rent expense under this sublease in July 2020. This sublease expired in December 2021, and the Company leases the space directly from the landlord. In June 2020, the Company entered into a 10-year lease agreement with ARE-SD Region No. 27, LLC (the “Landlord”) for new office and laboratory space in San Diego, California (“New HQ Lease”), with a target commencement date in May 2022. If the Landlord does not deliver the premises within 120 days of the target commencement date for any reason other than force majeure delays or delays by the Company, the Company may terminate the lease and neither the Landlord nor the Company will have any further rights, duties or obligations under the New HQ Lease. The Landlord shall make available to the Company for use within 12 months after the commencement date a tenant improvement allowance (“TI Allowance”), which the Company will repay to the Landlord as additional rent over the base term and shall accrue interest at a rate of 8 % per annum. Upon commencement, the contractual base rent will be charged, subject to partial rent abatement, annual base rent adjustments, the Company’s share of operating expenses and additional rent for the TI Allowance actually disbursed by the Landlord. In April 2021, the Company entered into a 62-month lease agreement for additional office and manufacturing space in San Diego, California. The lease includes certain rent escalations and additional charges for common area maintenance and other costs. The Company gained access to the leased space in June 2021 and began recognizing rent expense under this lease at that time. In April 2021, the Company amended its current lease for office space in San Diego, California. The lease amendment includes extension of the current lease expiration date by 24-months subsequent to commencement of the New HQ Lease, expansion of the existing premises for additional space and certain rent escalations. In January 2022, the Company entered into a Lease Agreement (the “OAS Lease”) with an affiliate of Alexandria Real Estate Equities, Inc. (“ARE”) to lease two buildings (“Building 3” and “Building 4”) to be constructed in connection with One Alexandria Square in La Jolla, California. The two buildings are comprised of office and manufacturing space and are intended to serve as the Company’s future headquarters. The term of the OAS Lease will commence when ARE’s work for Building 3 is substantially complete, which is expected to be November 1, 2024 (the “Commencement Date”). The Company’s obligation to pay rent for Building 3 will begin approximately seven months following the Commencement Date. The Company’s obligation to pay rent for Building 4 will begin 12 months following the Commencement Date, subject to the substantial completion of ARE’s work on Building 4. The Company has an option to accelerate the construction and delivery of Building 4 to be the same date as the Commencement Date for Building 3 and will receive 12 months of base rent abatement on Building 4 if it exercises this option. The initial term of the OAS Lease is 144 months following the Commencement Date. The Company has the one-time option to extend the term of the OAS Lease by 60 months upon prior notice to ARE. The annual base rent under the OAS Lease is initially based on $ 64.80 per square foot per year, or approximately $ 7.3 million per year for Building 3 and $ 6.0 million per year for Building 4, subject to annual increases of 3 % and certain other adjustments, and includes tenant improvement and warm shell allowances. Maximum tenant improvement and warm shell allowances total approximately $ 33 million. The Company will also pay for an estimated $ 24 million of certain tenant improvements plus 7 % interest per year amortized in equal monthly payments over the term of the OAS Lease. At the time of entering into the OAS Lease, the Company paid ARE $ 1.1 million as prepayment for rent and, as a security deposit, provided ARE with a $ 1.1 million standby letter of credit. Accounting for Operating Leases On January 1, 2022, the Company adopted ASC 842 (see Note 2). As of January 1, 2022, the remaining weighted-average lease term was 2.9 years and the weighted-average incremental borrowing rate used to determine the operating lease liabilities was 3.6 %. Cash payments included in the measurement of lease liabilities totaled $ 7.5 million. As of March 31, 2022 , the remaining weighted-average lease term was 2.7 years and the weighted-average incremental borrowing rate used to determine the operating lease liabilities was 3.6 %. Cash payments included in the measurement of lease liabilities totaled $ 6.8 million During the three months ended March 31, 2022, the Company incurred $ 1.1 million of lease costs, of which less than $0.1 million is related to the Company’s short-term lease and $ 0.3 million is related to variable lease payments, which are primarily comprised of common area maintenance and $0.7 million related to straight-line operating lease cost. The Company recorded straight-line operating lease costs of $ 0.3 million for the three months ended March 31, 2021. As of March 31, 2022, future minimum payments under the Company’s non-cancelable operating leases that have commenced are as follows (in thousands):
2022 (nine months remaining) $ 1,987
2023 2,817
2024 1,328
2025 438
2026 and thereafter 277
Future non-cancelable minimum lease payments 6,847
Less: discount ( 323 )
Total lease liabilities 6,524
Less: current portion 2,646
Lease liabilities, noncurrent $ 3,878 The total undiscounted future minimum lease payments associated with the New HQ Lease and OAS Lease are approximately $ 230.9 million and are not included in the table above. The Company did not recognized lease liabilities or corresponding ROU lease assets for these leases as their lease terms had not yet commenced as of March 31, 2022. Future minimum payments under all of the Company’s non-cancelable operating leases, including those that have not yet commenced, are as follows:
2022 (nine months remaining) $ 3,919
2023 6,892
2024 6,394
2025 10,914
2026 and thereafter 210,058
Total $ 238,177 Indemnification As permitted under Delaware law and in accordance with the Company’s bylaws, the Company indemnifies its officers and directors for certain events or occurrences while the officers or directors are or were serving in such capacity. The Company is also party to indemnification agreements with its officers and directors. The Company considers the fair value of the indemnification rights and agreements as minimal. Accordingly, the Company has not recorded any liabilities for these indemnification rights and agreements as of March 31, 2022. Other Contingencies We are not currently a party to any material legal proceedings. From time to time, we may become involved in legal proceedings arising in the ordinary course of our business. Regardless of outcome, litigation can have an adverse impact on us due to defense and settle |
