As of September 30, 2020, the Company had operating leases for manufacturing, laboratory and office space in San Diego, California consisting of approximately 83,000 square feet with remaining lease terms of 111 months. Additionally, the Company had operating leases for dedicated manufacturing suites at its contract manufacturers with remaining lease terms of up to 6 months.

On January 1, 2020, on the adoption of ASC 842, the Company recognized initial lease receivables of $2.7 million, ROU lease assets of $22.3 million, which was adjusted for the deferred rent balance of $2.3 million and an initial lease liability of $27.3 million, with respect to the existing leases. The option to extend its leases in San Diego was not recognized as part of the lease liability and ROU lease assets. Under previous authoritative accounting guidance, the Company had been the deemed owner under construction of the manufacturing facility. Upon the adoption of ASC 842 the Company derecognized the amounts previously presented on its balance sheet related to its manufacturing facility including construction in progress of $2.1 million within property and equipment, and the construction financing obligation of $2.5 million recorded within other long-term liabilities and $0.3 million of other receivables within prepaid and other current assets as of December 31, 2019. The Company also recorded a cumulative adjustment to the opening balance of accumulated deficit of $0.1 million. See below for additional details for the manufacturing facility.

During the nine months ended September 30, 2020 and 2019, the Company recognized $4.4 million and $1.7 million, respectively of operating lease expense. During the nine months ended September 30, 2020, the Company paid $3.6 million for its operating leases. As of September 30, 2020, the weighted average remaining lease term and weighted-average discount rate for operating leases were 8.9 years and 8.9%, respectively.

In July 2019, the Company entered into a lease agreement for a facility in San Diego, California to be retrofitted to Good Manufacturing Practice standards and plans to use the facility for manufacturing in its early stage clinical trials. Prior to the adoption of ASC 842 the Company was deemed for accounting purposes to be the owner of the building during the construction period. As a result, at December 31, 2019, the Company maintained on its balance sheet, construction in progress of $2.1 million within property and equipment, net, as it relates to the fair value of the building, with the respective construction financing obligation recorded within other long-term liabilities.

Upon adoption of ASC 842, the Company determined the lease would be accounted for as an operating lease. Further, upon adoption of ASC 842, the Company determined it was the owner of the tenant improvements but did not control the construction project and therefore the fair value of the building was derecognized and costs incurred by the Company related to the tenant improvements of $13.3 million were recorded as leasehold improvements and furniture and fixtures in property and equipment, net on the consolidated balance sheet as of September 30, 2020 and will be depreciated over the remaining lease term.

As of September 30, 2020, maturities of lease liabilities were as follows (in thousands):

Year ending December 31,
2020 (remaining 3 months)	$	1,219
2021		4,490
2022		4,302
2023		4,431
2024		4,564
Thereafter		24,956
Total lease payments		43,962
Imputed interest		(14,148	)
Total lease liability balance	$	29,814

Prior to adoption of ASC 842, future minimum lease payments under non-cancelable operating lease agreements as of December 31, 2019, which were undiscounted and excluded non-lease components, were as follows (in thousands):

Year ending December 31,
2020	$	2,662
2021		3,954
2022		4,259
2023		4,377
2024		4,505
Thereafter		24,638
Total future minimum lease payments	$	44,395

In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, contract research organizations, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with members of its board of directors and certain of its executive officers that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. The Company has not incurred any material costs as a result of such indemnifications and is not currently aware of any indemnification claims.

In the ordinary course of business, the Company may face claims brought by third parties against the Company. The Company does not believe that there is any litigation, asserted or unasserted claim pending that could, individually or in the aggregate, have a material adverse effect on the Company’s results of operations or financial condition.