12. Commitments and Contingencies Offer Letters The Company has entered into offer letters with certain of its executives. The letters provide for, among other items, salary, bonus and severance payments. Resignation of Former Chief Executive Officer On December 17, 2015, the Companys President and former Chief Executive Officer (CEO) resigned, which included his resignation as a member of the board of directors of the Company, in each case effective December 31, 2015. The Company entered into a separation agreement pursuant to which the Company agreed to pay the former CEO severance payments in accordance with his existing employment agreement totaling $527,500 and the maintenance of health benefits for a period of up to one year from the separation date. The separation agreement also provided for the modification of existing stock option grants such that all unvested portions of existing stock option grants were immediately vested and all existing stock option grants became exercisable for up to 90 days from the date of separation as in accordance with the terms of the original grants. The former CEO is subject to restrictive covenants, including non-competition and non-solicitation provisions. The severance payments and stock-based compensation related to the modification of existing grants was included as part of general and administrative expenses for the year ended December 31, 2015 in the accompanying statement of operations. Office Lease In August 2013, the Company entered into a lease for new corporate office space location in Baltimore, Maryland. The lease provides for three months of rent abatement and includes escalating rent payments. Rent expense is recognized on a straight -line basis over the term of the lease. Rent expense amounted to approximately $190,000 and $192,000 for the years ended December 31, 2015 and 2014, respectively . Pursuant to the terms of such lease, the Companys future lease obligation is as follows: Year ending December 31, 2016 $ 151,068 2017 154,845 2018 158,716 $ 464,62