Note 5—Leases:

In December 2011, the Company entered into a non-cancelable operating lease for office space in Los Angeles, California, which was subsequently amended in November 2012, December 2013, March 2014, July 2015 and  December 2017. The initial term of the lease was for seven years and commenced on December 10, 2011. Concurrent with the execution of the lease, the Company provided the landlord an automatically renewable stand-by letter of credit in the amount of $1.0 million. The stand-by letter of credit was collateralized by a high-yield savings account, which was classified as restricted cash, current, until March 31, 2026, when the lease was amended to remove the stand-by letter of credit requirement. In July 2025, the Company executed an amendment to its office space in Los Angeles, California to surrender certain suites effective March 31, 2026 and extend the lease term for the remaining 26,700 rentable square feet for an additional five years and five months through August 31, 2031. Base rent escalates annually and is abated from April 2026 through August 2026. Lease payments also include variable charges for the Company’s proportionate share of building operating expenses and real estate taxes based on a 2026 base year. The Company has the option to renew such lease for an additional five year term. Management determined that the renewal option is not reasonably certain to occur. 

In June 2012, the Company entered into a long-term lease agreement for office space in South San Francisco, California, which was subsequently amended in May 2014 and July 2015. As amended, the Company rented approximately 29,470 square feet. The term of this lease expired on  March 31, 2026. The Company provided the landlord an automatically renewable stand-by letter of credit in the amount of $1.1 million. The stand-by letter of credit was collateralized by a high-yield savings account, which was classified as restricted cash, current until 60 days after the expiration of the lease. The 60-day period lapsed, and the letter of credit was released during the three months ended June 30, 2026.

Total rent expense for the three months ended June 30, 2026 and 2025 was approximately $0.3 million and $1.0 million, respectively. Total rent expense for the six months ended June 30, 2026 and 2025, was approximately $1.4 million and $2.2 million, respectively. For purposes of determining straight-line rent expense, the lease term is calculated from the date the Company first takes possession of the facility, including any periods of free rent and any renewal option periods that the Company is reasonably certain of exercising. The Company’s office leases generally have contractually specified minimum rent and annual rent increases that are included in the measurement of the ROU asset and related lease liability. Additionally, under these lease arrangements, the Company may be required to pay directly, or reimburse the lessors, for real estate taxes, insurance, utilities, maintenance, and other operating costs. Such amounts are generally variable and therefore not included in the measurement of the ROU asset and related lease liability but are instead recognized as variable lease expense in selling, general and administrative costs in the condensed consolidated statements of operations when they are incurred.

Future minimum lease payments as of  June 30, 2026 were as follows (in thousands):

During the three month period ended  March 31, 2025, the Company signed a sublease agreement for the 12,429 square feet of office space with a sublease commencement date of  April 1, 2025. This sublease expired on March 31, 2026.

In August 2023, the Company entered into a long-term sublease agreement for 13,916 square feet of the office space in Los Angeles, California, which commenced in November 2023. This sublease expired on March 31, 2026.

The Company recorded no operating sublease income for the three months ended June 30, 2026 and $0.2 million for the three months ended June 30, 2025, and $0.2 million and $0.3 million for the six months ended June 30, 2026 and 2025, respectively, in other income (expenses) in the condensed consolidated statements of operations.