7. Lease Agreements

The Company leases one facility in Emeryville, California under an operating lease that expires in February 2023. The Emeryville lease contains an option to early terminate the lease by notifying the landlord on or before February 1, 2020, which expired unexercised. The lease also contains an option to extend the lease for an additional term, however, the Company is not reasonably certain to exercise this option.

The Company also previously leased two facilities in Berkeley, California under operating leases that had remaining lease terms until 2021 and 2023. On December 18, 2019, the Company entered into a Lease Termination Agreement (“the Lease Termination”) with each of the 7th Street Properties II (“7th Street LP”) and 7th Street Property General Partnership (“7th Street GP”) to early terminate the Company’s two operating leases in Berkeley, California. As a result of the lease terminations the Company was also released from all financial obligations under its sublease agreements.  The Company agreed to pay an early termination fee of $1.6 million in total and recognized a loss on lease termination of $0.4 million for the year ended December 31, 2019, which was included in other (expense) income, net in the consolidated statements of operations and comprehensive (loss) income.

The following table summarizes maturity of the Company’s operating lease liabilities as of March 31, 2020 (in thousands):

 

 

Rent expense recognized for operating leases was $44,000 and $0.6 million for the three months ended March 31, 2020 and 2019, respectively. Under the terms of the lease agreements, the Company is also responsible for certain variable lease payments that are not included in the measurement of the lease liability. Variable lease payments for operating leases were $2,000 and $0.6 million for the three months ended March 31, 2020 and 2019, respectively, including non-lease components such as common area maintenance fees.

The following information represents supplemental disclosure for the statement of cash flows related to operating leases (in thousands):

 

The present value assumptions used in calculating the present value of the lease payments as of March 31, 2020 and December 31, 2019 were as follows:

 

 

 

Sublease Agreements

In December 2019, the Company’s rights and obligations under its sublease arrangements transferred to 7th Street LP and 7th Street GP, and the Company was released from all financial obligations under its sublease agreements. Upon termination, the Company recognized a loss on lease termination of $0.4 million in Other (expense) income.

For the three months ended March 31, 2019, the Company recognized $0.8 million of sublease income under these sublease agreements in Other (expense) income.  No sublease income was recognized for the three months ended March 31, 2020 due to the termination of the sublease agreements in 2019.