Capital Leases On March 21, 2016, the Company entered into a lease agreement with ThermoFisher Scientific (Lessor). Under the terms of the agreement, the Company agreed to lease two pieces of equipment from the Lessor, a liquid chromatography system and an incubator, totaling in cost of $95,656. The term of the lease is five years (60 months), and the monthly lease payment is $1,942. In addition, there is a $1.00 buyout option at the end of the lease term. Minimum future annual capital lease obligations are as follows as of September 30, 2018: 2018 (remaining) $ 5,601 2019 22,402 2020 22,402 2021 7,468 Less interest (7,426 ) Principal 50,447 Less current portion (18,943 ) Noncurrent portion $ 31,504 Operating Leases In 2015, the Company recorded a $590,504 contingent lease termination fee of the master lease and sublease of 3165 Porter Drive in Palo Alto, California, which was payable to ARE-San Francisco No. 24 (ARE), if the Company received $15 million or more in additional financing in the aggregate. The additional financing was achieved in 2015 and the termination fee is reflected on the condensed consolidated balance sheet as an accrued lease contingency fee. On September 2, 2015, the Company entered a lease (the Lease) with AGP Sorrento Business Complex, L.P., for certain premises of office and laboratory space in buildings located at 11535 Sorrento Valley Rd., San Diego, California, to serve as the Companys corporate offices and laboratories (the New Premises). Because certain tenant improvements needed to be made to the New Premises before the Company could take occupancy, the term of the Lease did not commence until the New Premises were ready for occupancy, which was on February 4, 2016. The Lease terminates on February 28, 2022, unless earlier terminated in accordance with the Lease. Pursuant to the terms of the Lease, the monthly base rent is $35,631, subject to annual increases as set forth in the Lease. The Company has an option to extend the Lease term for a single, five-year period. If the Lease term is extended for the optional five-year period, the monthly base rent will be adjusted based on fair market rental value. In addition to rent, the Company agreed to pay a portion of the taxes and utility, maintenance and other operating costs paid or accrued in connection with the ownership and operation of the property. The Company recognized rent expense on a straight-line basis over the term of the lease. During the three and nine months ended September 30, 2018, the Company recorded rent expense of $115,238 and $345,714, respectively. Minimum future annual operating lease obligations are as follows as of September 30, 2018: 2018 (remaining) $ 151,204 2019 466,085 2020 480,068 2021 494,470 2022 41,306 Total $ 1,633,133 Legal Proceedings See Item 1 of Part II Other Information and Note 12 Subsequent Events for a discussion of legal proceedings.