NOTE 10 – COMMITMENTS

Operating leases

On February 11, 2014, the Company entered into a lease amendment and expansion agreement, whereby the Company agreed to lease additional premises for office space in New York City, commencing May 1, 2014 and expiring on April 30, 2019. In connection therewith, the original letter of credit was increased by $72,000 to $132,000 and the Company deposited an additional $72,354 into the restricted cash account maintained at the bank that issued the letter of credit.

As of December 31, 2015, future minimum lease payments for office space are as follows (in thousands):

Year Ending December 31,
2016	$	670
2017		683
2018		607
2019		181
	$	2,141

Rent expense charged to operations, which differs from rent paid due to rent credits and to increasing amounts of base rent, is calculated by allocating total rental payments on a straight-line basis over the term of the lease. During the years ended December 31, 2015 and 2014, rent expense was $0.6 million and $0.2 million, respectively and as of December 31, 2015 and 2014, deferred rent payable was $112,000 and $52,000, respectively, including the unamortized reimbursement referred to below and the current portion, which at December 31, 2015 and 2014, is $6,000 and $17,000, which is included in accrued expenses in 2015 and in prepaid expenses and other in 2014. In December 2015, the Company received a reimbursement of approximately $53,000 for leasehold improvements the Company incurred from the lessor of our San Diego facility. The reimbursement is being accounted for as deferred rent and is being amortized as a reduction to rent expense over the remaining term of the lease. As of December 31, 2015, the remaining unamortized amount is $34,000.

Research and development agreements

During 2015 and 2014, the Company entered into contracts with various contract research organizations for which there are outstanding commitments aggregating approximately $20.1 million at December 31, 2015 for future work to be performed.

Lederman employment agreement

On February 11, 2014, the Company entered into an employment agreement (the “Agreement”) with Dr. Seth Lederman (“Lederman”) to continue to serve as President, Chief Executive Officer and Chairman of the Board of Directors of the Company. Previously, the Company entered into a consulting agreement with Lederman & Co, pursuant to which Lederman received compensation for serving as the Company’s President and Chief Executive Officer. On February 11, 2014, the consulting agreement was terminated.

The Agreement, which has an initial term of one year and automatically renews for successive one year terms unless either party delivers written notice not to renew at least 60 days prior to the end of the current term, provides for various payments and benefits to Lederman in the event Lederman’s employment is terminated without cause (as defined therein), Lederman resigns for Good Reason (as defined therein) or in the event employment is terminated as a result of death or permanent disability.

Defined contribution plan

Effective April 1, 2014, the Company established a qualified defined contribution plan (the “401(k) Plan”) pursuant to Section 401(k) of the Code, whereby all eligible employees may participate. Participants may elect to defer a percentage of their annual pretax compensation to the 401(k) plan, subject to defined limitations. The Company is required to make contributions to the 401(k) Plan equal to 100 percent of each participant’s pretax contributions of up to 19 percent of his or her eligible compensation, and the Company is also required to make a contribution equal to six percent of each participant’s salary, on an annual basis, subject to limitations under the Code. For the years ended December 31, 2015 and 2014, the Company charged operations $0.4 million for both periods for contributions under the 401(k) Plan.