In March 2015, the Company entered into a lease agreement for approximately 50,740 square feet of office space located in Redwood City, California for a period beginning in June 2015 through May 2022 with initial annual payments of approximately $2.0 million, increasing to $2.4 million annually during the final year of the lease term. In December 2016, the Company entered into an amendment for an additional approximately 49,980 square feet of office space adjacent to the premises under the original lease (the Expansion Premises), with initial annual payments of $1.2 million, increasing to $2.9 million in the final year of the amended lease term. The lease for the Expansion Premises commenced on June 1, 2018. The amendment also extends the lease term for the original premises to terminate on the same date as the amended lease, which is May 31, 2025. In April 2017, the Company entered into a second amendment to the lease for a temporary space of 8,171 square feet for a period beginning in May 2017 and which ended on June 1, 2018, the Commencement Date of the Expansion Premises.

In August 2014, the Company entered into a new facility lease for warehouse space beginning on August 21, 2014 through May 31, 2015, under which it was obligated to pay approximately $100,000 in lease payments over the term of the lease. In March 2015, the Company extended the warehouse lease through February 2017 under which it was obligated to pay approximately $0.3 million in lease payments over the remaining term of the lease.

In February 2017, the Company entered into a separate non-cancellable facility lease for warehouse space beginning March 1, 2017 through February 28, 2022, under which the Company is obligated to pay approximately $0.4 million in lease payments over the term of the lease.

In August 2020, the Company entered into a lease for approximately 35,411 square feet of space for a manufacturing facility in Costa Rica to begin in April 2021 and to last through June 2031, under which it is obligated to pay approximately $3.9 million in lease payments over the term of the lease. The Company will classify and measure the lease on the commencement date in 2021.

The Company warrants that its products will operate substantially in conformity with product specifications and provides a limited one- to five-year warranty. Activities related to warranty obligations were as follows (in thousands):

	December 31,
	2020			2019
Beginning Balance	$	1,178		$	1,236
Provision for warranty		2,150			1,942
Utilization		(2,629	)		(2,000	)
Ending Balance	$	699		$	1,178

The Company has entered into supply agreements with certain of the Company’s suppliers that required certain minimum annual purchase agreements. As of December 31, 2020, the Company had no minimum annual purchase commitments. For the year ended December 31, 2019, the Company recorded a charge of $3.6 million related to the cancellation of firm purchase commitments for inventory related items.

The Company also entered into a service agreement in January 2020 for which it is committed to pay $2.5 million annually in each of the next four years.

In March 2006, the Company entered into an amended and restated license agreement with the Mayo Foundation for Medical Education and Research (Mayo) and Venturi Group LLC (VGL), which provides the Company access to the certain know how and licensed patents owned by Mayo and VGL for treatment of central, autonomic and peripheral nervous system disorders, including pain, using devices to modulate nerve signaling. The licenses granted are exclusive and the Company has the right to sub-license. The agreement will terminate upon the last to expire patent application, unless terminated earlier. The agreement can be terminated any time after three years from March 2006 by Mayo or VGL.

Per terms of the license, the Company is required to pay royalties based on the greater of earned royalty or minimum royalty. The earned royalty will be based on a percentage of net sales of licensed products either by the Company or the sub-licensee. The minimum royalty payment will be based on royalty periods as defined in the agreement.

In March 2011, the Company entered into a Phase II License Agreement with Mayo which provides the Company access to the certain know how and licensed patents owned by Mayo. The licenses granted are exclusive and the Company has the right to sub-license. The agreement will terminate upon the last to expire patent application, unless terminated earlier.

Royalties paid during the years ended December 31, 2020, 2019 and 2018 were $3.1 million, $3.2 million and $3.1 million, respectively.

In November 2014, the Company issued Mayo 20,833 shares of common stock owed in connection with the IPO pursuant to the terms of the license, and recorded noncash research and development expense of $0.5 million for the fair value of the shares on the date of issuance.

In July 2017, the Company entered into a license agreement for which it is committed to pay $0.2 million over the remaining term of this license agreement, which ends in 2022.

In February 2019, the Company entered into an agreement with a privately-held company to, among other things, provide the privately-held company financing in the form of a secured convertible note. Through March 31, 2020, the Company has provided financing totaling $8.5 million in the form of two secured convertible notes. The agreement additionally provides the Company with the exclusive right, but not the obligation, to acquire the privately-held company. As of December 31, 2019, the value of the secured convertible notes, measured at amortized cost, was $7.9 million, while the value of certain rights in relation to the agreement, measured at cost and monitored for impairment on an ongoing basis, was $1.0 million. These amounts are reported in Other Assets on the Condensed Consolidated Balance Sheet. The accretion of amortized cost is recorded in Interest Income, while any changes in value from impairment assessment are recorded in Other Income (Expense) in the Consolidated Statements of Operations and Comprehensive Income. The Company concluded that the privately-held company is a variable interest entity; however, the Company is not the primary beneficiary as it does not retain power to direct the activities that most significantly impact its economic performance.

In April 2020, the Company elected not to exercise its option to make a further investment in the privately-held company pursuant to the agreement. In connection with this decision, the Company no longer has the exclusive right to acquire the privately-held company. In June 2020, the privately-held company paid off the outstanding principal and accrued interest of its secured convertible notes in full. As a result of these two events, the Company recorded a net expense of $0.4 million in Other Income (Expense) in the Consolidated Statements of Operations and Comprehensive Income in the year ended December 31, 2020.

From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business activities. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. There have been no contingent liabilities requiring accrual at December 31, 2020 and 2019.

The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, including, among other circumstances, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not

determinable because it involves claims that may be made against the Company in the future, but have not yet been made.

The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has director and officer insurance coverage that reduces the Company’s exposure and enables the Company to recover a portion of any future amounts paid. The Company believes the estimated fair value of these indemnification agreements in excess of applicable insurance coverage is minimal.

The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with such indemnifications has been recorded to date.

On November 28, 2016, the Company filed a lawsuit for patent infringement against Boston Scientific Corporation and Boston Scientific Neuromodulation Corporation (collectively, Boston Scientific). The lawsuit, filed in the U.S. District Court for the Northern District of California (the California Court), asserted that Boston Scientific was infringing, or would soon begin infringing, seven of the Company’s patents covering inventions relating to the Senza system and HF10 therapy. The lawsuit sought preliminary and permanent injunctive relief against further infringement as well as damages and attorney’s fees. On July 24, 2018, the California Court issued an order on claim construction and summary judgment. In the order, the California Court ruled that six asserted method claims in three of the Company’s asserted patents were patent eligible and not invalid as indefinite. Collectively, the asserted claims cover methods for delivering SCS therapy at frequencies between 1.5 kHz and 100 kHz.

The California Court, however, found that Boston Scientific was not currently infringing the six upheld method claims. Specifically, the California Court found that Boston Scientific's sale of the Spectra WaveWriter systems for commercial use in the United States did not infringe the upheld method claims because Boston Scientific modified the Spectra WaveWriter systems to prevent them from being programmed to generate signals above 1.2 kHz. With regard to the use of the Spectra WaveWriter and the Precision with MultiWave systems in patients that had completed the ACCELERATE clinical trial, the California Court found such use fell within the safe harbor provision of 35 U.S.C. § 271(e). The California Court further held that 35 U.S.C. § 271(f) did not apply to method claims, and therefore the sale of the Precision with MultiWave systems in Europe does not infringe the upheld method claims. The California Court also found that the asserted system claims in four of the Company's asserted patents were invalid as indefinite. As discussed below, the California Court’s finding of invalidity was overturned by the U.S. Court of Appeals for the Federal Circuit (the Federal Circuit).

On July 27, 2018, the parties submitted a joint statement to the California Court wherein Boston Scientific asserted that, with respect to whether any U.S. launch of a high-rate product (such as the Precision with MultiWave and Spectra WaveWriter models used in the ACCELERATE study or any other system that is programmable at any frequency in the range 1.5 to 100 kHz) was imminent, Boston Scientific had not decided whether to launch such a product; had not established a timeline for when such a decision might be made, if ever; and had not determined what frequencies would be enabled if it were to decide to launch such a product in the future. Boston Scientific further confirmed its public statements that the ACCELERATE study was extended into 2019, with an estimated study completion date between April 2019 and November 2019. On the basis of the foregoing, the parties agreed to dismissal on ripeness grounds of the Company’s declaratory judgment claims without prejudice, each side to bear its own fees and costs as to these claims, and jointly requested that the California Court enter such a dismissal. The dismissal was thereafter entered as a court order on July 31, 2018. The Company and Boston Scientific each appealed portions of the California Court’s July 24, 2018 ruling to the Federal Circuit. On April 9, 2020, the Federal Circuit returned its ruling, which vacated and remanded the California Court’s judgment of invalidity. As a result of the Federal Circuit’s ruling, the system claims invalidated by the California Court were reinstated, and thus all of the Company’s asserted claims remain valid and enforceable. The litigation was then remanded to the California Court for further proceedings. However, on December 14, 2020, the parties agreed to the final dismissal

of all remaining claims before the California Court based on Boston Scientific’s assertion to the court that it still does not have any current plans to commercially launch a high frequency SCS system in the United States. The California Court entered the agreed upon dismissal on December 16, 2020.

On December 9, 2016, Boston Scientific filed a patent infringement lawsuit alleging the Company’s manufacture, use and sale of the Senza system infringes ten of Boston Scientific’s patents covering spinal cord stimulation technology related to stimulation leads, rechargeable batteries and telemetry (the Delaware I litigation). The lawsuit, filed in the U.S. District Court for the District of Delaware, seeks unspecified damages and attorney’s fees, as well as preliminary and permanent injunctive relief against further infringement. During this litigation, Boston Scientific unilaterally dismissed their assertions with regard to two of the ten patents. In relation to this lawsuit, the Company filed petitions for inter partes review at the U.S. Patent and Trademark Office (USPTO) against all the eight remaining patents asserted by Boston Scientific. As a result of those petitions, in February 2019, all of the asserted claims of Boston Scientific’s U.S. Patent Nos. 7,587,241 and 6,895,280 were found invalid by the Patent Trial and Appeal Board (PTAB) at the USPTO. The invalidity of each of those patents was later affirmed by the Federal Circuit on May 18, 2020 and May 29, 2020, respectively. This patent infringement lawsuit has been stayed pending completion of the inter partes proceedings since June 2018. As of this time, the Company is unable to determine an outcome or potential range of loss.

On April 27, 2018, Boston Scientific filed a second patent lawsuit alleging patent infringement, trade secret misappropriation and tortious interference with contract (the Delaware II litigation). The lawsuit, filed in the Delaware Court, seeks unspecified damages and attorney’s fees, as well as preliminary and permanent injunctive relief against further infringement. In relation to the Delaware II litigation, the Company filed seven petitions for inter partes review at the PTAB against seven of the nine patents asserted by Boston Scientific. In January 2020, the PTAB initiated inter partes reviews in all seven of the challenged patents in the Delaware II litigation. As a result of those petitions, in January 2021, the PTAB invalidated all but two of the challenged Boston Scientific claims across the seven inter partes reviews. The Company also filed counterclaims against Boston Scientific, alleging patent infringement of five Nevro patents. On June 22, 2020, the Delaware Court issued an order effectively consolidating the four Boston Scientific patents from the Delaware I litigation with the Boston Scientific trade secret misappropriation claims and Nevro’s five counterclaim patents from the Delaware II litigation. The consolidated litigation will proceed to trial scheduled for October of 2021. The Boston Scientific patent infringement claims of U.S. Patent No. 6,895,280 and the other patents of the Delaware II litigation have been stayed pending resolution of the inter partes reviews of the Delaware II litigation. As of this time, the Company is unable to determine an outcome or potential range of loss.

On February 14, 2019, the Company filed a lawsuit for patent infringement against Stimwave Technologies, Inc. (Stimwave) in the Delaware Court asserting that Stimwave was infringing the Company’s patents covering inventions related to its HF10 therapy and the Senza system, as well as a claim for false advertising under the Lanham Action Section 43(a), 15 U.S.C. § 1125(a). In relation to this lawsuit, on July 24, 2019, the Delaware Court granted Nevro's motion for preliminary injunction, and issued an order barring Stimwave, and all affiliated persons and entities, from infringing patent claims covering frequencies between 3 kHz and 10 kHz. On February 27, 2020, the Company and Stimwave entered into a Settlement Agreement, in which Stimwave agreed to cease commercialization of all high frequency spinal cord stimulation systems worldwide. Stimwave also agreed to entry of a permanent injunction in the Delaware Court, under which Stimwave’s products will not deliver spinal cord stimulation therapy that includes pulse frequencies between 1,500 Hz and 100,000 Hz. The permanent injunction was filed with the Delaware Court and entered on March 2, 2020. After the Delaware Court entered the permanent injunction, the case (including Stimwave’s appeal of the preliminary injunction order) were dismissed. As part of the permanent injunction filing, Stimwave acknowledged the validity of the patents Nevro asserted in the litigation. Per Nevro's request, the permanent injunction order does not enjoin Stimwave from providing follow-up care and programming for any patients who were already programmed with high frequency therapy in the United States prior to March 6, 2020, and in the rest of the world prior to April 30, 2020.

On February 28, 2020, the Company filed a lawsuit in the Delaware Court for patent infringement against Nalu Medical, Inc. (Nalu) asserting that Nalu is infringing the Company’s patents covering inventions related to its HF10 therapy and the Senza system.

As of December 31, 2020, the Company did not record a liability, as an outcome or potential loss range for each of its legal matters cannot be reasonably determined.

The Company is and may from time to time continue to be involved in various legal proceedings to defend its intellectual property, including several pending European patent oppositions at the European Patent Office (EPO) initiated by the Company’s competitors Medtronic and Boston Scientific, and an entitlement action filed by Boston Scientific in Germany. In addition, the Company is and may from time to time also be involved in various legal proceedings of a character normally incident to the ordinary course of business, such as employment matters, product liability matters, and professional liability matters, which the Company does not deem to be material to its business and consolidated financial statements at this stage.