11. Commitments and Contingencies From time to time, the Company may be subject to legal proceedings or regulatory encounters or other matters arising in the ordinary course of business, including actions with respect to intellectual property, employment, product liability, and contractual matters. In connection with these matters, the Company assesses, on a regular basis, the probability and range of possible loss based on the developments in these matters. A liability is recorded in the financial statements if it is believed to be probable that a loss has been incurred and the amount of the loss can be reasonably estimated. Because of the uncertainties related to the occurrence, amount, and range of loss on any pending actions, the Company is currently unable to predict their ultimate outcome, and, with respect to any pending litigation or claim where no liability has been accrued, to make a meaningful estimate of the reasonably possible loss or range of loss that could result from an unfavorable outcome. At December 31, 2014 and 2013, there were no material matters for which the negative outcome was considered probable or estimable. Operating leases In 2008, the Company entered into a noncancelable operating lease agreement to lease the Company s corporate headquarters in San Diego, California, through August 2013. In September 2009, the Company entered into a noncancelable operating lease agreement to expand the Company s corporate headquarters to an adjacent building, as well as to extend the term of the aforementioned operating lease to co-terminate both leases in 2015. In March 2012, the Company entered into a noncancelable operating lease agreement to increase the square footage of the Company s corporate headquarters, as well as to consolidate all of the existing operating leases into a single lease agreement. The new agreement extends the term of the lease of all buildings to May 2017. Under the new lease, the monthly rent payments total approximately $0.1 million, excluding common area maintenance and