In August 2018, the Company executed two noncancelable operating leases. One lease for approximately 6,000 square feet for vivarium, laboratory and general office space in South Brunswick, New Jersey. The lease was set to expire in July 2022. In January 2022, the Company signed a lease extension for up to one additional year through July 2023, with the option to terminate upon 120 days of written notice, with an increase in base rent as per the lease extension. The lease was terminated as of June 2023. The second lease is for office space in Lexington, Massachusetts, that terminated in August 2023.

In January 2021, the Company signed a lease for 50,581 square feet of office and laboratory space at One Research Way in Princeton, New Jersey. That lease term extends through 2032, has a five-year extension option, and replaced the Company’s two existing facilities as the Company’s headquarters in March 2023. Payment under this lease will total $19,889 through May 2032. The Company received a lease incentive of $4,046 from the lessor for a buildout of laboratory, vivarium, and office space. Management estimated the timing and amounts of reimbursements and included them as a reduction of lease payments when initially measuring the lease liability and right-of-use asset upon commencement. Since the inception date of the lease, $4,046 reimbursements were received. For the nine months ended September 30, 2024, $242 of reimbursements were received.

In August 2024, the Company entered into a Lease Termination Agreement with BMR-One Research Way LLC, a Delaware limited liability company (the “Landlord”), in connection with the termination of the lease for 50,581 square feet of office and laboratory space at One Research Way in Princeton, New Jersey (the “Termination Agreement”). Pursuant to the Termination Agreement, the Company and the Landlord agreed to terminate the lease at One Research Way in Princeton, New Jersey, contingent on the sale of the property by the Landlord to a prospective new buyer (the “Contingency”). The Contingency was met on the date of sale on October 1, 2024, and the lease was terminated on such date.

Pursuant to the Termination Agreement, and subject to the Contingency, the Company agreed to surrender the property and paid a total termination fee of approximately $1,420, consisting of (i) a cash payment in the amount of approximately $798 and (ii) a release of a security deposit from the Company’s existing letter of credit in the amount of approximately $622.

In September 2024, the Company signed a sublease agreement for 3,205 square feet of office and laboratory space at 311 Pennington Rocky Hill Road in Hopewell, New Jersey. The Company will utilize the premises as laboratory space for operational research and development activities. The sublease term extends through 2029 and provides the Company with the option to extend the term for an additional three year period. Payment under this sublease will total $768 through December 2029.

The components of lease cost for the three and nine months ended September 30, 2024 and 2023, are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Operating lease cost	$	367	$	366		1,105	$	1,559
Variable lease cost		146		161		507		792
Total lease cost	$	513	$	527	$	1,612	$	2,351

Amounts reported in the balance sheet for leases where the Company is the lessee as of September 30, 2024, and December 31, 2023, are as follows:


Operating Leases (in thousands, except lease term and discount rate data):	September 30, 2024			December 31, 2023
Right-of-use assets, operating leases	$	8,407		$	8,382

Operating lease liabilities, current	$	1,243		$	852
Operating lease liabilities, non-current		12,024			12,434
Total operating lease liabilities	$	13,267		$	13,286

Weighted-average remaining lease term (years)		7.57			8.42
Weighted-average discount rate		6.08	%		5.75	%

Other information related to leases for the nine months ended September 30, 2024 and 2023, respectively, as follows:


	Nine Months Ended September 30,
(in thousands)	2024		2023
Net cash paid for amounts included in the measurement of lease liabilities	$	1,119	$	1,842
Leased assets obtained in exchange for new or modified operating lease liabilities		554		11

Future minimum lease payments, net of reimbursements, remaining as of September 30, 2024, under operating leases by fiscal year were as follows:


Fiscal year	(in thousands)
2024	$	479
2025		2,012
2026		2,071
2027		2,132
2028		2,194
Thereafter		7,608
Total minimum lease payments	$	16,496
Less: Amounts representing imputed interest	$	(3,229	)
Present value of lease liabilities	$	13,267

Rent expense recorded during the three months ended September 30, 2024 and 2023 was $367 and $366, respectively. Rent expense recorded during the nine months ended September 30, 2024 and 2023 was $1,076 and $1,559 respectively.

From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of its business activities. The Company accrues a liability for such matters when future expenditures are probable and such expenditures can be reasonably estimated.