Note 13. Leases

On January 1, 2019, we adopted Financial Accounting Standards Board (“the FASB”) ASC Topic 842, Leases (ASC 842) (the “new lease standard”), using a modified retrospective transition approach with application as of the effective date of initial application without restating comparative period financial statements. The core principle of the new lease standard is that a lessee should recognize the assets and liabilities that arise from leases, including operating leases, in the statement of financial position. We measure our lease liabilities as the present value of remaining lease payments using our incremental borrowing rate applicable to the lease term as the discount rate. We elected to apply the package of practical expedients to our adoption of the new lease standard, which includes allowing us to continue utilizing historical classification of leases. We did not elect the practical expedient that permits a reassessment of lease terms for existing leases.

The Company is a lessee under leases for land, office space and equipment with third parties, all of which are accounted for as operating leases. These leases generally have an initial term of one to seven years and provide for fixed monthly payments. Some of these leases provide for future rent escalations and renewal options and certain leases also obligate us to pay the cost of maintenance, insurance and property taxes. Operating lease cost was $0.2 million and $0.5 million for the three months ended March 31, 2019 and 2018, respectively.

A summary of the classification of operating leases on our unaudited condensed consolidated balance sheet as of March 31, 2019 (amounts in thousands):


	March 31, 2019
Operating lease right-of-use assets	$	1,792
Operating lease liability, current (Other accrued expenses)		582
Operating lease liability, non-current (Other long-term liabilities)	$	1,464

Components of lease cost reflected in our unaudited condensed consolidated statement of operations for the three months ended March 31, 2019 (amounts in thousands):


	Three Months Ended
	March 31, 2019
Operating lease cost	$	155
Short-term lease cost		49
Total lease cost	$	204

A summary of weighted-average remaining lease term and weighted-average discount rate as of March 31, 2019:


Weighted-average remaining lease term	3.9	years
Weighted average discount rate	7.2	%

Supplemental cash flow and other non-cash information for the three months ended March 31, 2019 (amounts in thousands):


Operating cash flows from operating leases	$	139
Operating lease right-of-use assets obtained in exchange for new operating lease liabilities		—

Future annual minimum lease commitments as of March 31, 2019 were as follows (amounts in thousands):


	March 31, 2019
Remainder of 2019	$	603
2020		533
2021		516
2022		396
2023		302
Total minimum payments	$	2,350
Less: amount representing interest		(304)
Lease liability	$	2,046

The Company adopted ASU 2016-02 on January 1, 2019 as noted above, and as required, the future annual minimum lease commitments as of December 31, 2018 are provided below (in thousands):


	December 31, 2018
2019	$	1,571
2020		367
2021		350
2022		355
2023		302
Total minimum payments	$	2,945