What changed in this filing

/stocks — the workspaceLOADING

Item 2. Properties

2022-06-28 compared with 2021-06-24 · 38 added, 17 removed, 0 unchanged (100% of the section changed)

We currently lease approximately

2,600 square feet of executive office space at 9635 Granite Ridge Drive, Suite 100, San Diego , California 92123 under a 39-month

gross plus utilities lease that commenced on December 1, 2014 and expires on August 31, 2021.

The current rental rate under the lease

extension is $8,265 per month.

We also rent approximately

1,700 square feet of laboratory space at 11585 Sorrento Valley Road, Suite 109, San Diego, California 92121 at the rate of $6,148 per

month on a one-year lease that originally was to expire on November 30, 2020.

In December 2020, we entered into a short-term lease extension

running from December 1, 2020 through the completion date of our construction of our planned new laboratory space which is adjacent to

our current laboratory.

In December 2020, we entered into an agreement

to lease approximately 2,823 square feet of office space and 1,807 square feet of laboratory space.

The agreement carries a term of 63

months and we will commence paying rent when we take occupancy of those spaces, which is expected to occur in the third calendar quarter

For the initial year of the lease, the rental rate will be $13,385.55 per month.

Thereafter, the base rent will increase each

Office and Lab Space Leases

In December 2020, we entered

into an agreement to lease approximately 2,823 square feet of office space and 1,807 square feet of laboratory space located at 11555

Sorrento Valley Road, Suite 203, San Diego, California 92121 and 11585 Sorrento Valley Road, Suite 109, San Diego, California 92121, respectively.

The agreement carries a term of 63 months and we took possession of the office space effective October 1, 2021.

We took possession of

the lab space effective January 1, 2022.

On October 1, 2021, we recorded

a $343,633 right-of-use lease asset and associated lease liability related to the office space component of the lease based on the present

value of lease payments over the expected lease term of 63 months, discounted using our estimated incremental borrowing rate of 4.25%.

The current monthly base rent under the office component of the lease is $6,121.

During the three months ended

March 31, 2022, we recorded a $400,797 right-of-use lease asset and associated lease liability related to the lab space component of the

lease based on the present value of lease payments over the expected lease term of 63 months, discounted using our estimated incremental

borrowing rate of 4.25%.

The initial monthly base rent under the lab component of the lease is $7,456.

Manufacturing Space Lease

In October 2021, we entered into another lease

for an initial period of 58 months for (i) approximately 22,260 square feet of space located at 11588 Sorrento Valley Road, San Diego,

California 92121, or the Building, and (ii) 2,655 square feet of space located in the Building and commonly known as Suite 18, to house

our manufacturing operations.

That manufacturing space is located at 11588 Sorrento Valley Road, San Diego, California 92121 and it is

near our new lab and office locations.

We anticipate that the landlord will complete construction on this new space in the third calendar

quarter of 2022 and we will take occupancy at that time.

The initial base rent for the manufacturing space will be $12,080 per month.

Based on the assumptions that

we used to calculate the right-of-use lease asset for the new office and lab spaces, we estimate that we will record a right- of- use

lease asset of $614,240 and associated lease liability for the manufacturing space lease when we take possession of that space.

Mobile Clean Room

In addition, we rent a mobile

clean room on a short term, month-to-month basis, where we house our manufacturing operations until our permanent manufacturing space

is completed.

We also rent the land on which the mobile clean room is based on a month-to-month basis.

The mobile clean room is located

on leased land near our office and lab and we pay $2,000 per month for the right to locate it there.

We paid approximately $189,000 in

rent expense to lease the mobile clean room located on this space during the fiscal year ended March 31, 2022.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 2. Properties