COMMITMENTS AND CONTINGENCIESThe future non-lease commitments over the next five years and thereafter were as follows:
| | | | | |
| As of December 31, 2025 |
| (in thousands) | Purchase Commitments |
| 2026 | $ | 25,023 | |
| 2027 | 23,927 | |
| 2028 | 3,633 | |
| 2029 | 258 | |
| |
| |
| Total | $ | 52,841 | |
Licensing Agreements
The Company has entered into licensing agreements related to its research efforts. These agreements contain minimum annual royalty payments which are cancellable at the Company’s discretion, therefore they are not reflected in the above chart. Additionally, some of these licensing agreements include royalties that would be payable on net sales of Galleri, and any future products, pursuant to existing agreements and licenses with Illumina, the Chinese University of Hong Kong, and other third parties in excess of minimum annual royalty payments.
Purchase Commitments
The purchase commitments primarily relate to contractual commitments for future use of web services, and laboratory supplies in the normal course of business.
Intellectual Property
The Company entered into an agreement with a third party for exclusive option rights to certain intellectual property. The Company exercised those option rights to license intellectual property in December 2022. Under the terms of the agreement, the Company may be obligated to make future milestone payments if certain milestone events, such as new product launches or expansion into new regions, are achieved with respect to products covered by the licensed intellectual property. Two such milestones were achieved within 2024 and $1.0 million paid as of December 31, 2024. The remaining milestones are based on net sales over a minimum threshold in specified geographic regions, which were not probable of achievement as of December 31, 2025.
Indemnification
The Company has agreed to indemnify its directors and officers for certain events or occurrences while the director or officer is (or was) serving in such capacity. The indemnification period covers all pertinent events and occurrences during the director’s or officer’s service. The maximum potential amount of future payments the Company could be required to make under the applicable indemnification agreements is not specified in the agreements.
The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third party with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual after the execution of the agreement. The maximum potential amount of future payments that the Company could be required to make under these arrangements is not determinable. The Company has not incurred material costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, the Company believes the estimated fair value of these agreements is minimal.