7. Commitments and Contingencies Leases We have an operating lease related to our office space. Minimum rental commitments under operating leases at December 31, 2019 are as follows ($ in thousands): Year Ending December 31, 2020 $ 420 2021 431 2022 442 2023 453 2024 464 Thereafter 2,133 Total $ 4,343 Rent expense under operating leases was $386,000 and $347,000 in 2019 and 2018, respectively. Supplemental other information related to leases as of and for the year ended December 31, 2019: Operating lease cost $ 386 Weighted-average remaining lease term (years) 9.3 Weighted-average discount rate (%) 5 % Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 395 Severance Payments We have agreements with key personnel that provide for severance payments to them in the event of a change in control of the Company, as defined in those agreements, and their employment is terminated in connection with that change in control. In such event, our aggregate severance payments to those employees would be between approximately $700,000 and $1.5 million depending upon the circumstances. Legal and Regulatory Matters On October 12, 2018 and November 30, 2018, the Company received letters (the Litigation Demand Letters) from two stockholders demanding that the Company take action to remedy alleged harm caused to the Company, including to remedy alleged breaches of fiduciary duties by certain current and/or former directors and executive officers of the Company. The stockholders alleged, inter alia, that certain current and former directors and executive officers violated their fiduciary duties beginning at least in July 2016 by engaging in an illegal scheme to misrepresent the Companys performance by falsely reporting accounts receivable, license revenue, total current assets and total assets, total stockholders equity, and total liabilities for the year ended December 31, 2016, causing the Company to suffer damages by overstating financial results for the fourth quarter of 2016. The allegations referenced in the Litigation Demand Letters are related to the claims asserted in the securities class action Anthony Giovagnoli v. GlobalSCAPE, Inc., et. al., Case No. 5:17-cy-00753, previously disclosed in the Companys Current Report on Form 8-K filed on November 15, 2017 (the Prior Litigation). On November 7, 2018, a special litigation committee (Special Litigation Committee) consisting of Dr. Thomas Hicks and Frank Morgan, was formed by the Board to analyze and investigate claims asserted in the October 12, 2018, Litigation Demand Letter and, subsequently, the November 30, 2018 Litigation Demand Letter, and consider claims that could potentially be asserted in stockholder derivative litigation related to facts connected to the claims and allegations in the Prior Litigation and the Litigation Demand Letters (the Potential Derivative Litigation). The Board charged the Special Litigation Committee with, among other things, determining what actions are appropriate and in the best interests of the Company, and determining whether it is in the best interests of the Company to pursue, dismiss, or consensually resolve any claims that may be asserted in the Potential Derivative Litigation. The Board determined that each member of the Special Litigation Committee is disinterested and independent with respect to the Potential Derivative Litigation. Among other things, the Special Litigation Committee had the power to retain counsel and advisors, as appropriate, to assist it in the investigation, to gather and review relevant documents relating to the claims, to interview persons who may have knowledge of the relevant information, to prepare a report setting forth its conclusions and recommended course of action with respect to the Potential Derivative Litigation, and to take any actions, including, without limitation, directing the filing and prosecution of litigation on behalf of the Company, as the Special Litigation Committee in its sole discretion deems to be in the best interests of the Company in connection with the Potential Derivative Litigation. The Board resolved that the Special Litigation Committees findings and determinations shall be final and not subject to review by the Board and in all respects shall be binding upon the Company. Between November 2018 and March 2019, the Special Litigation Committee, with the assistance of outside legal counsel to the Special Litigation Committee, conducted an investigation of the Potential Derivative Litigation. On March 28, 2019, the Special Litigation Committee reported that it had completed its investigation and delivered its recommendation to the Board that the Company should not pursue the Potential Derivative Litigation because, among other things, it would not be in the best interest of the Company to do so. On April 18, 2019, outside counsel for the Special Litigation Committee informed the two stockholders that sent the Litigation Demand Letters of the Special Litigation Committees recommendation and informed the stockholders that the Company would not pursue the Potential Derivative Litigation. The Company is not aware of any subsequent litigation commenced by these two stockholders or any other stockholders concerning claims related to the Potential Derivative Litigation. As disclosed in a Current Report on Form 8-K filed on March 16, 2018, the Fort Worth, Texas Regional Office of the SEC has opened a formal investigation of issues relating to the Restatement, with which the Company is cooperating fully. At this time, the Company is unable to predict the duration, scope, result or related costs associated with the SECs investigation. The Company is also unable to predict what, if any, action may be taken by the SEC, or what penalties or remedial actions the SEC may seek. Any determination by the SEC that the Companys activities were not in compliance with existing laws or regulations, however, could result in the imposition of fines, penalties, disgorgement, equitable relief, or other losses, which could have a material adverse effect on the Companys financial position, liquidity, or results of operations. On May 31, 2018, the Company was served with a subpoena issued by a grand jury sitting in the United States District Court for the Western District of Texas (the Grand Jury Subpoena). The Grand Jury Subpoena requests all documents and emails relating to the Companys investigation of the potential improper recognition of software license revenue. The Company intends to fully cooperate with the Grand Jury Subpoena and related investigation being conducted by the United States Attorneys Office for the Western District of Texas (the U.S. Attorneys Investigation). At this time, the Company is unable to predict the duration, scope, result or related costs of the U.S. Attorneys Investigation. The Company is also unable to predict what, if any, further action may be taken in connection with the Grand Jury Subpoena and the U.S. Attorneys Investigation, or what, if any, penalties, sanctions or remedial actions may be sought. Any determination by the U.S. Attorneys office that the Companys activities were not in compliance with existing laws or regulations, however, could result in the imposition of fines, penalties, disgorgement, equitable relief, or other losses, which could have a material adverse effect on the Companys consolidated financial position, liquidity, or results of operations.