Commitments and Contingencies

3 Months Ended

Mar. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

Operating Lease Commitments

The Company leases office space under non-cancellable operating leases for its corporate headquarters in Austin, Texas in two adjacent buildings under separate lease agreements. Pursuant to the first of which the Company leases approximately 67 square feet of office space with an initial term that expires on April 30, 2021, with the option to extend the lease for an additional five-year term, and pursuant to the second of which the Company leases approximately 129 square feet of office space with an initial term that expires on April 30, 2028, with the option to extend the lease for an additional ten-year term. The Company also leases office space in south Austin, Texas; Lincoln, Nebraska; Des Moines, Iowa; Atlanta, Georgia; Asheville, North Carolina; San Mateo, California; Bangalore, India; Sydney, Australia; London, United Kingdom; and Amsterdam, Netherlands. On December 18, 2019, the Company entered into an office lease agreement with Aspen Lake Building Three, LLC to lease approximately 129 rentable square feet of an office building to be located immediately adjacent to the Company's headquarters in order to expand the Company's headquarters, commencing May 1, 2021. During the year ended December 31, 2019, the Company vacated one of its Atlanta, Georgia facilities and recorded an unoccupied lease charge of $0.4 million for the remaining contractual lease payments and related fees, less estimated sublease income. The lease liabilities related to the sublease that are expected to be paid during the succeeding twelve-month period of $0.3 million are recorded in accrued liabilities, and the remaining portion of the associated liability of $0.1 million is recorded in other long-term liabilities on the accompanying condensed consolidated balance sheet at March 31, 2020.

The Company believes its current facilities and facilities under contract will be adequate for its needs for the current term and will evaluate its need for expansion beyond the 2021 lease expiration. Rent expense under operating leases was $1.6 million and $1.2 million for the three months ended March 31, 2020 and 2019, respectively.

The components of lease costs, lease term and discount rate were as follows:



	Operating Leases
Lease expense:
Operating lease expense	$	2,323
Sublease income	(142		)
Total lease expense	$	2,181

Other information:
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	2,398
Right-of-use assets obtained in exchange for operating lease liabilities as of March 31, 2020	$	33,211
Weighted-average remaining lease term - operating leases	6.5 years
Weighted-average discount rate - operating leases	5.5		%

Future minimum payments required under operating leases that have initial or remaining non-cancelable lease terms in excess of one year at March 31, 2020 were as follows:



	Operating Leases
Year Ended December 31,
2020 (April 1 to December 31)	$	7,252
2021	8,597
2022	8,149
2023	7,803
2024	6,741
Thereafter	15,544
Total lease payments	$	54,086
Less: present value discount	(11,409		)
Present value of lease liabilities	$	42,677

As of March 31, 2020, the Company had approximately $33.8 million of future payments under additional leases, primarily for corporate facilities, that have not yet commenced. These operating leases will commence between October 2020 and May 2021 with lease terms of approximately six years to ten years.

Contractual Commitments

The Company has non-cancelable contractual commitments related to the 2023 Notes and the 2026 Notes as well as the related interest, third-party products, co-location fees and other product costs. The Company is party to several purchase commitments for third-party products that contain both a contractual minimum obligation and a variable obligation based upon usage or other factors which can change on a monthly basis. The interest on the 2023 Notes is payable semi-annually on February 15 and August 15 of each year. The interest on the 2026 Notes is payable semi-annually on June 1 and December 1 of each year. The estimated amounts for usage and other factors are not included within the table below. Future minimum contractual commitments that have initial or remaining non-cancelable terms in excess of one year were as follows:



	Contractual Commitments
Year Ended December 31,
2020 (from April 1 to December 31)	$	16,515
2021	21,884
2022	18,068
2023	242,338
2024	2,651
Thereafter	319,808
Total commitments	$	621,264

Legal Proceedings

From time to time, the Company may become involved in legal proceedings arising in the ordinary course of its business. The Company is not presently a party to any legal proceedings that, if determined adversely to the Company, would have a material adverse effect on the Company.

Loss Contingencies

In the ordinary course of business, the Company is subject to loss contingencies that cover a range of matters. An estimated loss from a loss contingency, such as a legal proceeding or claim, is accrued if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated.