10. Commitments and Contingencies Operating lease agreements In October 2016, the Company entered into a lease agreement for laboratory space in Foster City, California, United States. The lease has a term of 5 years and terminates in October 2021. The annual rental expense approximates $0.2 million. The Company was provided with one month of free rent. In November 2017, the Company entered into a lease agreement for laboratory space in Menlo Park, California, United States. The lease terminates in November 2020. The annual rental expense approximates $0.8 million. The Company was provided with one month of free rent. In January 2018, the Company entered into a lease agreement for office space in London, United Kingdom. The lease has a term of five years and terminates in January 2023. The annual rental expense approximates $0.8 million. In March 2018, the Company entered into a lease agreement for office space in Boston, Massachusetts, United States, which terminates in September 2022. The annual rental expense approximates $0.3 million. In December 2018, the Company leased additional office space in London, United Kingdom, which terminates in January 2023. The annual rental expense approximates $0.1 million. In January 2019, the Company leased additional office and laboratory space in Menlo Park, California, United States. The lease terminates in December 2020. The annual rental expense approximates $0.1 million. Fremont lease agreement In December 2018, the Company leased manufacturing and office space in Fremont, California, which terminates in May 2030. The annual rent expense approximates $2.4 million. The Company was provided with 8 months of free rent. Subject to the terms of the lease agreement, the Company executed a $3.0 million letter of credit upon signing the lease, which may be reduced by 25% subject to reduction requirements specified therein. This amount is classified as restricted cash on the condensed consolidated balance sheet. The Company intends to perform non-normal tenant improvements to the property to customize the facility to suit the Companys unique manufacturing needs. The Company is responsible for paying directly the costs associated with the construction project and as such the Company will be deemed for accounting purposes only to be the owner of the construction project, even though it is not the legal owner. As of March 31, 2019, the Company has not broken ground or incurred significant soft costs associated with the construction. The lease provides for approximately $5.0 million in tenant improvement allowances to be reimbursed to the Company by the landlord, which will be amortized into rental expense over the term of the lease. Upon the start of construction, the Company is required to deposit $10.0 million in an escrow account. Subject to the terms of the lease and reduction provisions, this amount may be decreased to nil over time. As of March 31, 2019, the Company has no funds deposited in the escrow account. Future minimum lease payments The following table summarizes the future minimum lease payments due under all operating leases as of March 31, 2019: (In thousands) 2019 3,955 2020 6,497 2021 4,700 2022 4,448 2023 3,314 Thereafter 23,400 Total contractual obligations 46,314 The Company recorded rent expense totaling $1.2 million and $0.5 million for the three months ended March 31, 2019 and March 31, 2018, respectively. Other funding commitments The Company has entered into several license agreements (Note 7). In connection with these agreements the Company is required to make milestone payments and annual license maintenance payments not met at March 31, 2019 and December 31, 2018 or royalties on future sales of specified products. The Company determined that no milestone payments that have not already been accrued were probable as of March 31, 2019. Commitment with contract manufacturing organization The Company has entered into agreements with contract manufacturing organizations relating to the provision of manufacturing services and purchase of clinical material to be used in clinical trials that include minimum purchase commitments. As of March 31, 2019, and December 31, 2018, there was $2.3 million and $0.8 million included within prepayments related to prepaid instalments against these minimum commitments. The Company is committed to make further payments totaling $8.0 million between April 2019 and March 2021 . Legal proceedings The Company is not a party to any material litigation and does not have contingency reserves established for any litigation liabilities.