Lease Obligation

12 Months Ended

Dec. 31, 2021

14. LEASE OBLIGATION

In December 2018, the Company entered into an operating lease with Vertex Pharmaceuticals Inc. (“Vertex”) to lease approximately 13,170 square feet of office, laboratory and vivarium space at 50 Northern Ave, Boston, Massachusetts, expiring in December 2020. In July 2020, the Company extended the term of the lease through February 2021.

On July 21, 2020, the Company entered into an operating lease agreement for 20,752 square feet of office, lab and animal care facility space located in Boston, Massachusetts for the Company’s corporate headquarters. The commencement date of the lease was February 19, 2021 and the lease term is 63 months. The lease provides a three-month free rent period, which commenced on the lease commencement date. The base rent at commencement is $145 thousand per month and escalates by 3% annually for total lease payments during the term of $9.3 million.

The Company's lease agreement requires the Company to maintain a cash letter of credit to secure their obligations under the lease of $0.9 million. This balance is included in other assets on the accompanying consolidated balance sheets. The Company recognized a right of use asset of $7.5 million and an operating lease liability of $7.5 million upon the commencement of the lease.

The components of the lease costs which are included in the consolidated statements of operations and comprehensive loss were as follows (in thousands):


	Year Ended December 31,
	2021		2020
Operating lease costs	$	1,693	$	1,011
Variable lease costs		479		706
Total lease costs	$	2,172	$	1,717

Our variable lease cost primarily related to operating expenses, parking, taxes and insurance associated with our operating leases.

Supplemental cash flow information relating to the Company’s leases were as follows (in thousands):


	December 31,
	2021		2020
Cash paid for amounts included in the measurement of lease liabilities (operating cash flows)	$	1,259	$	1,025

The remaining lease terms and discount rates related to our leases were as follows:


	As of December 31,
	2021	2020
Remaining lease term	4.4 years	0.2 years
Discount Rate	7.7%	8.0%

The future minimum lease payments for the Company’s operating lease as of December 31, 2021, were as follows (in thousands):


Fiscal Year	Operating Leases
2022	$	1,774
2023		1,827
2024		1,882
2025		1,938
2026		817
Thereafter		—
Total minimum lease payments		8,238
Less amounts representing interest or imputed interest		1,251
Present value of lease liabilities	$	6,987