COMMITMENTS AND CONTINGENCIES

LEASES

On September 9, 2013, the Company entered into a lease for its former corporate headquarters in New York, NY for a period of five years beginning October 1, 2013. Under the terms of the lease, the Company owed an initial annual rent of approximately $139,000, payable in monthly installments of approximately $12,000, unless earlier terminated in accordance with the lease. As of December 31, 2016 the total future minimum lease payments to be paid under the agreement, which expires in September 2018, was $266,000. The agreement also required an initial security deposit of $69,000 which is included in other long term assets. The annual rental rate, beginning after the first year, is subject to an increase, on a cumulative basis, at a rate of 2.5% per annum compounded annually.

In May 2015, the Company entered into a sublease agreement for its former corporate headquarters in New York, NY. As of December 31, 2016 the total future minimum lease payments to be received under the sublease agreement, which expires in September 2018, was $292,000.

On March 20, 2014, the Company received the consent of the master landlord for a sublease agreement dated March 10, 2014, pursuant to which the Company subleased office space in Menlo Park, CA through November 30, 2017. From the commencement date, the Company owed an initial annual rent of approximately $165,000, payable in equal monthly installments, unless earlier terminated by either party in accordance with the lease. The annual rental rate is subject to an approximately 3.0% increase at each anniversary of the commencement date during the term. As of December 31, 2016 the total future minimum lease payments to be paid under the agreement, which expires in November 2017, was $157,000.

In August 2015, the Company entered into a sublease agreement for its office space in Menlo Park, CA. As of December 31, 2016, the total future minimum lease payments to be received under the sub-lease agreement, which expires in November 2017, was $178,000.

On January 7, 2015, the Company entered into a sublease agreement to sublease office space in East Palo Alto, CA through September, 2018 to serve as its new Company headquarters. The annual rent is approximately $425,000, payable in equal monthly installments, unless earlier terminated by either party in accordance with the lease. The annual rent is subject to an approximate 3.0% increase at each anniversary of the commencement date during the term of the sublease agreement. The agreement also required an initial security deposit of $231,000 which is included in other long-term assets. As of December 31, 2016, the total future minimum lease payments to be paid under the agreement, which expires in September 2018 was $790,000.

On December 1, 2016, the Company entered into a monthly lease agreement in Tel Aviv, Israel, where it is conducting operations in support of CybeRisk. The annual rent is approximately $12,000, payable in equal monthly installments, unless earlier terminated by either party in accordance with the lease.

The Company accounted for its “Cease-Use Liability” in accordance with ASC 420 “Exit or Disposal Cost Obligations”.

The following table sets forth the Company’s aggregate future minimum payments under its operating lease commitments as of December 31, 2016 (in thousands):



Years ending December 31,
2017	$	753
2018	458
Total	$	1,211

For the years ended December 31, 2016 and 2015, the rent expense was approximately $782,000 and $667,000, respectively.

Rental income for the years ended December 31, 2016 and 2015 was $349,000 and $132,000, respectively.

Sublease income is recorded as a reduction in rental expense. Future minimum lease payments to be received under the sublease agreements as of December 31, 2016 are as follows (in thousands):



Years ending December 31,	New York		Menlo Park		Total
2017	$	165	$	178	$	343
2018	127		—		127
	$	292	$	178	$	470