Note

Leases

We adopted ASU

No.

2016

02—Leases

(Topic

842

), as amended, as of

January 1, 2019,

using the modified retrospective approach. The modified retrospective approach provides a method for recording existing leases at adoption and in comparative periods that approximates the results of a full retrospective approach. The Company elected to adopt the ‘package of practical expedients’, which permitted the Company

not

to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs, the practical expedients pertaining to land easements, the use-of hindsight, the short-term lease recognition exemption for all leases that qualified, and the practical expedient to

not

separate lease and non-lease components for all leases other than leases of real estate.

Adoption of the new standard resulted in the recording of an additional net operating lease right-of-use asset and operating lease liability of approximately

$0.2

million each, as of

January 1, 2019.

The difference between the additional lease assets and lease liabilities was recorded as an adjustment to accumulated deficit. The standard did

not

materially impact our consolidated net loss and had

impact on cash flows. The Company does

not

have any finance leases.

Our leases consist primarily of office space. Leases with an initial term of

months or less, and leases which are on a month-to-month basis, are

not

recorded on the balance sheet. For these leases we recognize lease expense on a straight-line basis over the lease term.

Most leases include

one

or more options to renew, with renewal terms that can extend the lease term from

one

three

years or more. The exercise of lease renewal options is at our discretion. Our lease agreements do

not

contain any variable lease payments, residual value guarantees or restrictive covenants. The components of lease expense for the

twelve

months ended

December 31, 2019

were immaterial. As our leases do

not

provide an implicit interest rate, we use our incremental current borrowing rate in determining the present value of lease payments.

Maturities of lease liabilities were as follows (in thousands):

	December 31, 2019
2020	$	220
2021		110
2022		20
Thereafter		-
Total	$	350
Less interest		20
Present value of lease liabilities	$	330

Other information related to the Company's operating leases was as follows (in thousands):

	December 31, 2019
Supplemental Cash Flow Information
Operating cash flows from leases	$	(5	)
Lease Term and Discount Rate
Weighted average remaining lease term (years)		1.67
Weighted average discount rate		6.75	%