10.

Commitments and

Contingencies

Operating Leases

December 2011,

the Company entered into a non-cancelable lease agreement with Metropolitan Life Insurance Company, or the Landlord, referred to as the Existing Lease, for approximately

13,787

square feet of office and laboratory facilities located at

301

Galveston Drive, Redwood City, California, or the Current Premises, which serve as the Company headquarters, effective

April 2012.

Rent expense from the facility lease is recognized on a straight-line basis from the inception of the lease in

December 2011,

the early access date, through the end of the lease.

May 2014,

the Company entered into an amendment, or the Lease Amendment, to the Existing Lease for the Current Premises. Pursuant to the Lease Amendment, the term of the Existing Lease

was extended for a period of

twenty

(

) months and

twenty-two

(

) days and expiring on

January 31, 2018,

unless sooner terminated pursuant to the terms of the Existing Lease. In addition, the Lease Amendment included a new lease on an additional approximately

12,106

square feet of office space located at

351

Galveston Drive in Redwood City, California, or the Expansion Space, which is adjacent to the Current Premises. The new lease for the Expansion Space has a term of

months commencing on

August 1, 2014,

and expiring on

January 31, 2018.

October 2, 2015,

the Company executed an agreement to sublease

approximately

11,871

square feet of the Expansion Space for a term of

months commencing on

December 1, 2015.

The sublessee was entitled to abatement of the

first

two

monthly installments of rent. Subsequent monthly installments of rent start at a rental rate of

$2.05

per square foot (subject to agreed nominal increases). Minimum rents received under this sublease were

$0.3

million for the year ended

December 31, 2017

and are expected to be

$25.0

thousand for the year ending

December 31, 2018.

June 14, 2017,

the

Company entered into a

second

amendment, or the Second Lease Amendment, to the Existing Lease, and as amended by the Second Lease Amendment, the Lease, with the Landlord, for approximately

25,893

square feet located at

301

–

351

Galveston Drive, Redwood City, California, or the Current Premises and the Expansion Space, together, the Premises. Pursuant to the Second Lease Amendment, the term of the Existing Lease has been extended for a period of

seventy-two

(

) months, or the Extended Term, beginning

February 1, 2018

and expiring

January 31, 2024,

or the Expiration Date, unless sooner terminated pursuant to the terms of the Lease.

Pursuant to the Lease Amendment, the Company will pay on a monthly basis annual rent of approximately

$1.2

million, with annual increases each

-month period beginning

February 1

, and the

first

two

months to be abated provided that the Company is

not

in default thereunder. In addition, the Company will pay the Landlord specified percentages of certain operating expenses related to the leased facility incurred by the Landlord.

Rent

expense was

$0.6

million,

$0.3

million and

$0.6

million for the Premises during the years ended

December

31,

2017,

2016

and

2015,

respectively.

Future minimum payments under the

Lease as of

December

31,

2017,

are as follows (in thousands):

Year Ending December 31:
201 8	$	959
2019		1,231
2020		1,268
2021		1,305
2022		1,345
Thereafter		1,501
Total minimum payments	$	7,609

Litigation

From time to time the Company

may

be involved in legal proceedings arising in the ordinary course of business. The Company does

not

have contingent liabilities established for any litigation matters.