Leases

9 Months Ended

Sep. 30, 2023

In January 2018, we entered into an operating sublease arrangement for approximately 40,765 square feet for our office and research and development space at 620 Memorial Drive, Cambridge, MA 02139 from February 2018 extending through September 2025. The lease required a security deposit, which we fulfilled with a standing letter of credit secured by restricted cash on deposit.

On July 14, 2023, we entered into a sublease termination and surrender agreement with our landlord Bio-Rad Laboratories, Inc. (“Bio-Rad”) pursuant to which both parties agreed to terminate the sublease agreement, dated as of December 27, 2017, effective as of September 15, 2023. The sublease agreement was previously scheduled to terminate, in accordance with its terms, on September 30, 2025. In exchange for the early termination of the sublease agreement, we agreed to make a one-time termination payment to Bio-Rad in the amount of $0.5 million and Bio-Rad is also entitled to draw on a letter of credit in an amount equal to $0.9 million and retain such proceeds. Further, Bio-Rad may be entitled to an additional payment of up to $2.5 million if the Company realizes specified monetization events. This contingent payment is measured at fair value and recorded within on our unaudited condensed consolidated balance sheets. The carrying value of the liability as of September 30, 2023 was $0.7 million.

For the three months ended September 30, 2023 and 2022, we recorded rent expense of $1.8 million and $0.7 million, respectively. For the nine months ended September 30, 2023 and 2022, we recorded rent expenses of $3.3 million and $2.2 million, respectively. Operating cash flows used for operating leases were $2.1 million and $2.3 million for the nine months ended September 30, 2023 and 2022, respectively.

The following table presents supplemental balance sheet information related to our operating leases (in thousands):


	September 30, 2023			December 31, 2022
Assets:
Operating lease right-of-use assets	$	—		$	6,868
Liabilities:
Operating lease liabilities, current	—			2,259
Operating lease liabilities, noncurrent	—			5,265
Total lease liabilities	$	—		$	7,524

Other information:
Weighted-average remaining lease term (in years)	0.00 years			2.75 years
Weighted-average discount rate	—		%	9.5		%