LEASES

12 Months Ended

Mar. 31, 2020

Operating Leases

The following table provides balance sheet information related to operating leases as of March 31, 2020 (in thousands):



	March 31, 2020
Assets
Operating lease, right-of-use assets	$	78,963

Liabilities
Operating lease liabilities, current	$	5,875
Operating lease liabilities, non-current	92,452
Total operating lease liabilities	$	98,327

During the year ended March 31, 2020, operating lease expense was approximately $15.0 million. Variable lease and short-term lease costs were $1.6 million during the year ended March 31, 2020.

The following table presents supplemental information for the year ended March 31, 2020 (in thousands, except for weighted average remaining lease term and discount rate):



Weighted average remaining lease term	8.9 years
Weighted average discount rate	4.0		%
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating leases	$	9,856

The following table presents maturity of lease liabilities under the Company's non-cancellable operating leases as of March 31, 2020 (in thousands):



2021	$	9,765
2022	16,270
2023	15,237
2024	11,722
2025	11,386
Thereafter	58,078
Total lease payments	$	122,458
Less: imputed interest	(21,522		)
Less: lease incentives receivable	(2,609		)
Present value of lease liabilities	$	98,327

On July 3, 2019, the Company entered into a lease for a new company headquarters to rent 177,815 square feet of office space as the sole tenant in a new five-story office building located in Campbell, California.

The lease is for a 132-month term that started on January 1, 2020. The Company has the option to extend the lease for two additional five-year terms, on substantially the same terms and conditions as the prior term, with the base rent rate adjusted to fair market value at that time.

Base rent is approximately $0.7 million per month for the first 12 months of the lease, with the rate increasing by approximately 3% on each anniversary of the lease. The Company is responsible for paying its share of building and common area expenses. Lease incentive received by the Company included a full rent abatement during the first 12 months of the lease term and tenant improvement allowance of approximately $15.4 million. The Company paid to the landlord a security deposit in the amount of $2.0 million, which may be drawn down in the event the Company defaults under the lease. Upon obtaining full access to the

leased property during the second quarter of fiscal 2020, the Company recognized an operating lease right-of-use asset of $56.8 million and operating lease liability of $56.1 million.

Lease Assignment

In the fourth quarter of fiscal 2018, the Company entered into a 132-month lease agreement (the "Agreement") with CAP Phase I, a Delaware limited liability company (the "Landlord"), to rent approximately 162,000 square feet of office space in a new building in San Jose, California. The lease term began on January 1, 2019. On April 30, 2019, due to the Company's rapid growth and greater than anticipated future space needs, the Company entered into an assignment and assumption (the "Assignment") of the Agreement with the Landlord, and Roku Inc., a Delaware corporation ("Roku"), whereby the Company assigned to Roku the Agreement. Pursuant to the Assignment, the Company expects to be released from all of its obligations under the lease and related standby letter of credit by the end of the Company’s fiscal year ending March 31, 2022, or shortly thereafter. The Company also expects to receive the reimbursement of base rent and direct expenses from Roku in the fourth quarter of fiscal 2021 in accordance with the Assignment.

The obligations related to the Agreement is not included in the right-of-use asset or lease liabilities as of March 31, 2020. The remaining obligations related to the Assignment of $9.0 million and the termination fee of $0.8 million are recorded in other accrued liabilities and other liabilities, non-current, respectively, in the Company's consolidated balance sheet. The expected receivable of $6.9 million is recorded in other current assets in the Company's consolidated balance sheet.