Commitments and Contingencies

Leases

On December 29, 2016, the Company entered into an agreement with BMR-Axiom LP to lease office and laboratory space as its new corporate headquarters located at 4550 Towne Centre Court, San Diego, California (Lease) for a period of 10 years commencing on October 30, 2017.

The Lease provides an option to extend the Lease for an additional 5.0 years at the end of the initial term. The Company provided a standby letter of credit for $0.9 million in lieu of a security deposit. This amount will decrease to $0.6 million after year two of the lease and decrease to $0.3 million after year 5 of the lease term. As of December 31, 2018, $0.9 million was pledged as collateral for such letter of credit and recorded as restricted cash. The Lease provided an allowance for tenant improvements of $13.7 million, which was classified as deferred rent on the Company’s consolidated balance sheet and is being amortized as an offset to rent expense with a corresponding charge to depreciation expense on a straight-line basis over the term of the lease. The annual rent under the Lease is subject to escalation during the term. In addition to rent, the Lease requires the Company to pay certain taxes, insurance and operating costs relating to the leased premises. The Lease contains customary default provisions, representations, warranties and covenants.

Annual future minimum payments under operating leases as of December 31, 2018 are as follows (in thousands):



2019	$	3,951
2020	4,070
2021	4,192
2022	4,318
2023	4,447
Thereafter	18,308
Total future minimum lease payments	$	39,286

Rent expense was $2.8 million, $1.7 million and $1.1 million for the years ended December 31, 2018, 2017 and 2016, respectively.

Licensing Agreements

In the normal course of business, the Company enters into licensing agreements under which the Company commits to certain annual maintenance payments. Annual future minimum licensing payments under the Company’s agreements as of December 31, 2018 are as follows (in thousands):



2019	$	120
2020	120
2021	120
2022	120
2023	120
Total future minimum license payments	$	600

Supply Agreements

In the normal course of business, the Company enters into agreements for the manufacturing and supply of its clinical and commercial products. In 2017, the Company entered into agreements arranging for the manufacture and supply of GIAPREZA through 2022. During this time, the Company is obligated to make certain minimum purchases. Annual future minimum payments for manufacturing and supply agreements as of December 31, 2018 are as follows (in thousands):



2019	$	2,759
2020	2,759
2021	2,759
Total future minimum manufacturing and supply agreement payments	$	8,277