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Leases | 6 Months Ended
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Jun. 30, 2021
Leases [Abstract] |
Leases | Leases The Company’s lease arrangements at June 30, 2021 consist of (i) a lease for office and laboratory space at its headquarters in Chicago, Illinois that commenced in July 2020 (the “Chicago Lease”), (ii) a lease for office space at a multi-tenant facility in Cambridge, MA that commenced in March 2019 and is cancelable at any time (the “Cambridge Lease”), and (iii) leases for office equipment (the “Office Equipment Leases”). Each of these leases are classified as operating leases. Due to the nature of the Cambridge Lease, the Company determined that this lease represented a short-term lease with an initial term of less than twelve months and, as such, the Cambridge Lease is not recorded on the balance sheet and related lease costs are recognized in the statement of operations as they are incurred. The Company has also elected to not record the Office Equipment Leases on the balance sheet since related payment amounts and lease costs are insignificant. Lease costs for the Office Equipment Leases are recognized in the statement of operations on a straight-line basis over the lease term. The Company’s lease arrangement for office and laboratory space at its former headquarters in Skokie, Illinois ended in February 2021 in accordance with the terms of that lease arrangement. Chicago Lease The Company has approximately thirty thousand square feet of office and laboratory space in Chicago, Illinois (the “Chicago Lease”). The original term (the “Original Term”) of the Chicago Lease is 10 years, commencing on July 1, 2020 (the “Commencement Date”), which is the date the premises were ready for occupancy under the terms of the Chicago Lease. The Company has options to extend the term of the Chicago Lease for two additional successive periods of five years each (the “Extension Periods”) at the then prevailing effective market rental rate. The initial annual base rent during the Original Term is approximately $1,113 for the first 12-month period of the Original Term, payable in monthly installments beginning on the Commencement Date. Base rent thereafter is subject to annual increases of 3%, for an aggregate amount of $12,761 over the Original Term. The Company must also pay its proportionate share of certain operating expenses and taxes for each calendar year during the term. During the first 12-month period of the Original Term, the base rent and the Company's proportionate share of operating expenses and taxes are subject to certain abatements. In connection with the Chicago Lease, the Company will maintain a letter of credit for the benefit of the landlord in an initial amount of $1,200, which amount is subject to reduction over time. Upon execution of the Chicago Lease, the Company paid to the landlord the first installment of base rent and the estimated monthly amount of its pro rata share of taxes and its pro rata share of operating expenses in the aggregate amount of $87 which amount had been adjusted for the abatement as set forth in the lease agreement. The Company also paid the landlord a net amount of $697 toward tenant improvements. As part of the agreement for the Chicago Lease, the Company is required to maintain a standby letter of credit during the term of the lease, currently in the amount of $1,200 and subject to reduction over time, which is secured by a restricted certificate of deposit account and presented within other noncurrent assets on the Company’s unaudited condensed consolidated balance sheet at June 30, 2021. The Company recognized a right of use asset of $8,931 and a lease liability of $8,147 on the Commencement Date. Because the rate implicit in the Chicago Lease is not readily determinable, the Company used its incremental borrowing rate of 8.3% on the Commencement Date to determine the present value of the lease payments over the Original Term. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease. As of June 30, 2021, the Company determined it is not reasonably certain that the renewal option would be exercised. Information related to the Company’s operating lease asset and related operating lease liabilities were as follows:
|  | June 30, 2021
Weighted-average remaining lease term |  | 9.0 years
Weighted-average discount rate |  | 8.3 | %
The following table summarizes lease costs in the Company’s unaudited condensed consolidated statement of operations:
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2021 |  | 2020 |  | 2021 |  | 2020
Operating lease costs | $ | 326 |  |  | $ | 296 |  |  | $ | 653 |  |  | $ | 380 |
Short term lease costs | 31 |  |  | 29 |  |  | 62 |  |  | 67 |
Variable lease costs | 195 |  |  | 92 |  |  | 572 |  |  | 149 |
Total lease costs | $ | 552 |  |  | $ | 417 |  |  | $ | 1,287 |  |  | $ | 596 |
The Company made cash payments for operating leases of $1,106 and $1,227 during the six months ended June 30, 2021 and 2020, respectively. Maturities of the Company’s lease liability as of June 30, 2021 were as follows:
Years Ending December 31, |  | Operating Leases
2021 (remaining six months) |  | $ | 478 |
2022 |  | 1,163 |
2023 |  | 1,198 |
2024 |  | 1,235 |
2025 |  | 1,272 |
2026 |  | 1,310 |
Thereafter |  | 4,897 |
Total |  | $ | 11,553 |
Less: imputed interest |  | (3,437) |
Total lease liability |  | $ | 8,116 |
Current operating lease liability |  | $ | 420 |
Noncurrent operating lease liability |  | 7,696 |
Total lease liability |  | $ | 8,116 |

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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
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