5. COMMITMENTS AND CONTINGENCIES Operating Leases The Company leases its office and research facilities in Waltham and Lexington, Massachusetts under non-cancellable operating leases. The Lexington, Massachusetts facility lease expires in June 2023. The Waltham, Massachusetts facility lease was extended in April 2017. The effective date of the extension is January 2018. Under the terms of the extension, the lease will expire in December 2024 with one extension term of five years. Terms of the agreements generally provide for an initial rent-free period and future rent escalation, and provide that in addition to minimum lease rental payments, the Company is responsible for a pro-rata share of common area operating expenses. The Companys wholly-owned subsidiary, ProChon, leased a facility in Woburn, Massachusetts which expired in 2016 and was not renewed. Rent expense under operating lease agreements amounted to approximately $248 and $248 for the three months ended September 30, 2017 and 2016, respectively, and $743 and $742 for the nine months ended September 30, 2017 and 2016, respectively. As an inducement to enter into its Waltham and Lexington facility leases, the lessors agreed to provide the Company with construction allowances of up to $3,184 and $996, respectively, towards the total cost of tenant improvements. The Company has recorded these costs in the consolidated balance sheets as leasehold improvements, with the corresponding liability as deferred lease incentive. The liability is amortized on a straight-line basis over the term of the leases as a reduction of rent expense. The Waltham lease renewal effective January 1, 2018 provides for a tenant improvement allowance not to exceed $0.9 million, of which $0.5 million can be applied to future rental payments. License Agreements From time to time, the Company enters into various licensing agreements whereby the Company may use certain technologies in conjunction with its product research and development. Licensing agreements and the Companys commitme