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OPERATING LEASES | 6 Months Ended
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Jun. 30, 2019
Leases [Abstract] |
OPERATING LEASES | 4. OPERATING LEASES As described in Note 1 on Summary of Significant Accounting Policies – New Accounting Pronouncements Recently Adopted, we adopted Topic 842 as of January 1, 2019. Prior period amounts have not been adjusted and continue to be reported in accordance with historical accounting under Topic 840. Menlo Park Office Space Lease We have an operating lease for our office space at 149 Commonwealth Drive, Menlo Park, California, that commenced in February 2018 and expires in January 2020. We have an option to extend the lease for one additional period of two years, which we did not include in determining the right-of-use asset or lease liability as we did not consider it reasonably certain that we would exercise such option. Since the operating lease is a net lease, as the non-lease components (i.e., common area maintenance) are paid separately from rent based on actual costs incurred, such non-lease components were not included in the right-of-use asset and liability and are reflected as an expense in the period incurred. The components of lease costs included in operating expenses in our condensed statements of operations were as follows:
|  | Three Months Ended |  |  | Six Months Ended |
(In thousands) |  | June 30, 2019 |  |  | June 30, 2019 |
Operating lease costs |  | $ | 175 |  |  | $ | 348 |
Variable lease costs (1) |  |  | 6 |  |  |  | 8 |
Total lease costs |  | $ | 181 |  |  | $ | 356 |
| (1) | Variable lease costs represent non-lease components, such as common area maintenance charges.
The operating lease liability on the condensed balance sheet reflects the present value of the remaining lease payments over the remaining lease term. In determining the present value of lease payments, we applied our incremental borrowing rate based on the information available as of the January 1, 2019 adoption date. As of June 30, 2019, future minimum payments under the operating lease were as follows (in thousands):
2019 |  | $ | 350 |
2020 |  |  | 58 |
Total lease payments |  |  | 408 |
Less: imputed interest |  |  | (6 | )
Total |  | $ | 402 |
As of June 30, 2019, the weighted average remaining lease term is 7 months and the weighted average discount rate used to determine the operating lease liability was 5%. New Jersey Office Space Lease In April 2019, we entered into an operating lease agreement for office space located at 3 Sylvan Way, Parsippany, New Jersey. The initial term of the lease is 11 years with an option to extend for an additional five years and a one-time option to terminate the lease without cause as of the 103rd month anniversary of the commencement date of the lease. We have not yet occupied the space as it is being renovated for our use. The lease term commences upon the earlier of the date of completion of the construction work or the date upon which we occupy and use the space for its intended purpose. Since we do not yet have control of the space, as defined by Topic 842, during the construction period and do not expect to gain control of the space until on or near the construction completion date, we will not record a right-of-use asset and corresponding lease liability until we occupy the space, which we expect to occur by the end of the third quarter of 2019. Upon the commencement of the lease, the aggregate minimum future lease payments for the initial lease term is approximately $3,700,000, net of a seven-month rent abatement period. Under the lease, we are also obligated to pay certain variable expenses separately from the base rent, including electricity and common area maintenance. Such costs will be expensed in the period they are incurred. We have performed an evaluation of our other contracts with vendors in accordance with Topic 842 and have determined that, except for the operating leases described above and a nominal financing lease for office equipment, none of our contracts contain a lease.

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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
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