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Leases
3 Months Ended
Mar. 31, 2020
Leases [Abstract]  
Leases

5. Leases

In March 2017, the Company entered into an operating facility lease agreement for approximately 34,500 rentable square feet located at the 1020 Space. The lease commenced in August 2017 for a period of 87 months with one renewal option for a five-year term. The Company did not include the renewal option period as the Company determined it was not reasonably certain the lease would be renewed as of the modification date.

In October 2018, the Company executed a sublease agreement in Palo Alto, California for approximately 4,240 square feet for office space. The rental term of the sublease commenced on October 30, 2018 and expires August 31, 2020.  

The Company’s rent expense including both short-term and variable lease components of $0.2 million associated with the facility leases was $0.8 million for the period ended March 31, 2020 and 2019. Cash paid for amounts included in the measurement of lease obligations for operating cash flows from operating leases for the three months ended March 31, 2020 and 2019 was $0.7 million. As of March 31, 2020, the Company’s operating leases had a weighted average remaining lease term of 4.4 years and a weighted average discount rate of 7.75%, which approximates the Company’s incremental borrowing rate.

As of March 31, 2020, minimum lease payments under non-cancelable operating leases by period were expected to be as follows (in thousands):

 

Year Ending December 31,

 

 

 

 

2020 (9 months remaining)

 

$

1,990

 

2021

 

 

2,618

 

2022

 

 

2,697

 

2023

 

 

2,777

 

2024

 

 

2,373

 

Total future minimum lease payments

 

 

12,455

 

Less: discount

 

 

(2,846

)

Total operating lease obligations

 

 

9,609

 

Less current operating lease obligations

 

 

(2,324

)

Noncurrent operating lease obligations

 

$

7,285

 

 

 

1020 Marsh Sublease

In August 2018, the Company entered into an operating sublease agreement with EVA for the 1020 Space. The 1020 Space sublease commenced on October 1, 2018 for 72 months. EVA is entitled to an abatement of base rent of approximately $0.9 million for the first five full calendar months of the term of the sublease. Lease income associated with this sublease is recorded in other income in the accompanying consolidated statement of operations. For the three months ended March 31, 2020, the Company recorded an impairment charge to long-lived assets as previously discussed in Note 2, also associated with this impairment charge the Company recorded  a write down totaling $1.4 million related to a sublease receivable balance and previously capitalized commission charges, which has been recorded in other expense within the condensed consolidated statement of operations. Overall, for the three months ended March 31, 2020, the Company recorded a loss associated with this sublease of $0.7 million. For the three months ended March 31, 2019, the Company recognized sublease income of approximately $0.7 million. During the three months ended March 31, 2020 and 2019, cash received from EVA was $0.4 million, which amount was included in prepaid expenses and other current assets for operating cash flows.