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Leases | Leases Adoption of Topic 842 Effective January 1, 2021, the Company adopted Topic 842 utilizing the modified retrospective transition method, which requires a cumulative-effect adjustment, if any, to the opening balance of retained earnings to be recognized on the date of adoption with prior periods not restated. The primary impact for the Company was the balance sheet recognition of operating lease ROU assets and operating lease liabilities. The Company does not have any finance leases. The following table summarizes the impacts of adopting Topic 842 on the Company’s consolidated balance sheet as of December 31, 2020 (in thousands):
The Company has operating leases for real estate, and co-located data centers. During the three and six months ended June 30, 2021, operating lease expense was approximately $12.8 million and $24.8 million, respectively. Variable lease cost, short-term lease cost and sublease income were immaterial during the three and six months ended June 30, 2021. As of June 30, 2021, $45.3 million was included in and $206.4 million as long-term operating lease liabilities. The following table presents maturity of lease liabilities under the Company’s non-cancelable operating leases as of June 30, 2021 (in thousands):
(1)Calculated using the interest rate for each lease. In addition, the Company has executed operating leases for data centers, colocation space and facilities which have not commenced as of June 30, 2021. The legally binding minimum lease payments for these leases is $94.1 million with lease term ranging between to ten years. Of the above, approximately $90.0 million pertains to an amendment signed by the Company on June 30, 2021 for its headquarters office lease to include an additional space of approximately 123,000 square feet for a term of 9 years. The possession of this space is expected to be obtained in the first quarter of 2022. The following table presents supplemental information for the six months ended June 30, 2021 (in thousands, except for weighted average and percentage data):
(1) Does not include $8.1 million of leasehold incentives received from the landlord. ASC 840 Disclosures Prior to the adoption of Topic 842, future minimum lease payments as of December 31, 2020, which were undiscounted, were as follows (in thousands):
Rent expense for the three and six months ended June 30, 2020 was $10.0 million and $20.0 million, respectively.
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