Commitments and Contingencies

9 Months Ended

Sep. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 9. Commitments and Contingencies

Leases

In June 2021, the Company entered into a lease agreement for office space located at 4275 Executive Square, Suite 950, La Jolla, California 92037 where it occupies 8,681 square feet. The lease became effective as of July 1, 2021 and continues through June 30, 2023. Rent payments are approximately $29,000 per month for the first year and increase by 4.5% in the second year. A security deposit of $33,000 was paid in June 2021 and is classified as a long-term asset on the unaudited condensed balance sheet.

Previously, the Company leased certain office space in San Diego, California under a month to month lease. Rent payments were approximately $1,000 per month.

Rent expense totaled approximately $101,000 and $6,000 for the nine months ended September 30, 2021 and for the period from January 3, 2020 (inception) through September 30, 2020, respectively.

The below table provides supplemental cash flow information related to leases as follows (in thousands):

		Nine Months Ended
		September 30, 2021
Cash paid for amounts included in the measurement of lease liabilities:
	Operating cash flows from operating leases	$	91
Right-of-use assets obtained in exchange for lease obligations:
	Operating leases		679

Supplemental balance sheet information related to leases is as follows (in thousands, except lease term and discount rate):

		September 30, 2021
Operating leases
	Right-of-use assets, net	$	600
	Right-of-use lease liabilities, current		328
	Right-of-use lease liabilities, noncurrent		275
	Total operating lease liabilities	$	603
Weighted average remaining lease term
	Operating leases	1.8 years
Weighted average discount rate
	Operating leases		9.0	%

Future minimum lease commitments are as follows as of September 30, 2021 (in thousands):

		Operating Leases
Year Ending December 31,
	2021	$	90
	2022		370
	2023		189
	Total lease payments		649
	Less imputed interest		(46	)
	Total	$	603

Contingencies

From time to time, the Company may become subject to claims or suits arising in the ordinary course of business. The Company will accrue a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. As of September 30, 2021 and December 31, 2020, the Company is not a party to any litigation.