Commitments And Contingencies
|12 Months Ended|
Dec. 31, 2011
|Commitments And Contingencies [Abstract]|
|Commitments And Contingencies||
NOTE 7—COMMITMENTS AND CONTINGENCIES
The Company leases certain of its facilities under noncancelable leases, which qualify for operating lease accounting treatment under ASC 840, "Leases," and, as such, these facilities are not included on its consolidated balance sheets.
In July 2011, the Company entered into a noncancelable facility sublease agreement for 28,180 square feet of laboratory space and office space located in South San Francisco, California, which will serve as the Company's new corporate headquarters. The lease began on October 1, 2011 and will expire on April 30, 2017. The aggregate rent for the term of the lease is approximately $3.4 million. In addition, the lease requires the Company to pay certain taxes, assessments, fees and other costs associated with the premises, in amounts yet to be determined. The Company will also be responsible for the costs of certain tenant improvements associated with the leased space. In connection with the execution of the lease the Company paid a security deposit of approximately $60,000.
In August 2004, we entered into a noncancelable facilities sublease agreement for 33,700 square feet of laboratory and office space that originally expired on February 28, 2010 for our headquarters in Redwood City, California. In February 2006, the Company entered into a new lease for an additional 34,205 square feet of office space and extended the lease term for the existing space located at the Company's headquarters in Redwood City, California to September 30, 2011. The lease was for a period of 66 months, beginning on April 1, 2006 with respect to the additional square footage and began on March 1, 2010 with respect to the existing square footage. The lease expired on September 30, 2011.
On April 1, 2005 the Company entered into a noncancelable lease agreement that originally expired on February 28, 2010 for approximately 6,489 square feet of laboratory space, in Redwood City, California. In connection with the execution of the lease, the Company paid a security deposit of approximately $25,000. On November 17, 2009 the Company extended the term of the lease agreement term to expire in August 2012. The aggregate rent for the extended term of the lease is approximately $0.4 million.
As of December 31, 2011 the future rental payments required by the Company for all of its facilities under noncancelable operating leases are as follows (in thousands):
Rent expense for the years ended December 31, 2011, 2010, 2009 and, cumulatively, for the period from October 17, 2001 (date of inception) to December 31, 2011 was $1.3 million, $1.2 million, $1.2 million, and $9.1 million, respectively.
On October 14, 2009, the Company entered into an exclusive license agreement with Eleison Pharmaceuticals, Inc. ("Eleison"). Pursuant to the agreement the Company granted Eleison exclusive worldwide rights to develop and commercialize glufosfamide for the treatment of cancer in humans and animals, and certain other uses. Under the agreement, Eleison is responsible for the development, manufacturing and marketing of glufosfamide. Eleison and the Company will share equally in the profits of commercialization, if the further clinical development of glufosfamide leads to regulatory approval and marketing.
Eleison will pay the Company 50% of its profits from commercialization on a quarterly basis, beginning on the date of first commercial sale, if any. Eleison has the right to sublicense some or all of its rights under the agreement, and will pay the Company 50% of amounts received under any sublicenses, including, without limitation, any royalty payments, license fee payments, milestone payments and payments for any equity or debt purchases by a sublicensee, within 30 days of the receipt of any such amounts or payments by Eleison. Eleison will bear all costs associated with development, commercialization and patent prosecution, and will control product development and commercialization. In addition, Eleison will be responsible for all royalty and milestone payments due under the Baxter license and MediBIC development agreement. The agreement contemplates that Eleison, to satisfy its diligence obligations, will raise sufficient funds to commence clinical development activities with glufosfamide. In 2011, the Company received $0.1 million in revenue, which represents the Company's 50% share of an upfront payment from a sublicense by Eleison.
The Company enters into indemnification provisions under its agreements with other companies in the ordinary course of business, including business partners, contractors and parties performing its clinical trials. Pursuant to these arrangements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party as a result of the Company's activities. The terms of these indemnification agreements are generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable. The Company has never incurred costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, the Company believes the estimated fair value of these agreements is minimal. The Company maintains commercial general liability insurance and products liability insurance to offset certain of its potential liabilities under these indemnification provisions.
The Company's bylaws provide that it is required to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of a culpable nature, to the fullest extent permissible by applicable law; and to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified.
The entire disclosure for commitments and contingencies.
Reference 1: http://www.xbrl.org/2003/role/presentationRef