The Company leases office, manufacturing, and clinical centers under non-cancelable operating leases which expire on various dates through 2031. These leases generally contain scheduled rent increases or escalation clauses and renewal options. Operating lease right-of-use assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The operating lease right-of-use assets also include any lease payments made to the lessor at or before the commencement date. The Company recognizes operating lease expense on a straight-line basis over the lease period. The total operating lease cost recognized during the three months ended March 31, 2019 was $1.3 million and cash paid for operating leases during the three months ended March 31, 2019 was $1.4 million.

On October 4, 2018, the Company entered into an office lease (“San Francisco Lease”) to rent approximately 117,560 rentable square feet in San Francisco, California, which will become the Company’s new headquarters. The Company’s current headquarters is in the same building as the office space covered by the San Francisco Lease.

The San Francisco lease is expected to commence on or around the second quarter of 2019 and has a twelve-year term, which will expire on August 31, 2031. The Company is entitled to one option to extend the San Francisco Lease for a five-year term, subject to certain requirements. In addition, the landlord will provide a tenant improvement allowance of up to $2.4 million for leasehold improvements in connection with the cost of construction of the initial alterations within the premises.

Annual rental payments will be $10.0 million, with a 3% increase each year and will be accounted for in accordance with Topic 842.

The Company has obtained a standby letter of credit in the amount of $6.9 million, which may be drawn down by the landlord to be applied for certain purposes upon the Company’s breach of any provisions under the San Francisco Lease.

As of March 31, 2019, maturities of operating lease liabilities were as follows (in thousands):

Period Ending December 31:
2019 (remainder of year)	$	4,107
2020		2,092
2021		1,160
2022		432
2023		427
Thereafter		1,698
		9,916
Less: imputed interest		(874	)
Total operating lease liabilities	$	9,042

Minimum future lease payments previously disclosed in the 2018 10-K and under the previous lease accounting standard, which includes annual rental payments for the San Francisco lease which has not commenced as of the reporting date, for the year ended December 31, 2018 are as follows (in thousands):

Period Ending December 31:
2019	$	8,135
2020		10,669
2021		10,828
2022		11,150
2023		11,483
Thereafter		98,209
Total	$	150,474

The weighted average remaining lease term of the Company’s operating leases as of March 31, 2019 was 3.95 years. The weighted average discount rate of the Company’s operating leases is 4.75% as of March 31, 2019.

From time to time, the Company may become involved in legal proceedings arising from the ordinary course of its business. Management is currently not aware of any matters that could have a material adverse effect on the financial position, results of operations or cash flows of the Company.

In the ordinary course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend an indemnified party for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising from third-party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amount of future payments the Company could be required to make under these provisions is not determinable. The Company has also entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers to the fullest extent permitted by California corporate law. The Company currently has directors’ and officers’ insurance. The Company has never incurred material costs to defend lawsuits or settle claims related to these indemnification provisions, and believes that the estimated fair value of these indemnification obligations is not material and it has not accrued any amounts for these obligations.