Commitments and Contingencies
|12 Months Ended|
Dec. 31, 2015
|Commitments And Contingencies Disclosure [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.
The Company had a noncancelable facility sublease agreement for 31,104 square feet of laboratory space and office space located in South San Francisco, California, which serves as the Company’s 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 November 2013, the Company entered into a noncancelable facility lease agreement for 7,934 square feet of additional office space located in South San Francisco, California. The lease began on December 1, 2013 and would have expired on December 31, 2016. The aggregate rent for the original term of the lease was approximately $0.7 million. The Company terminated the lease for additional office space in June 2015.
As of December 31, 2015, the future rental payments required by the Company for its facility under its noncancelable operating lease were as follows (in thousands):
Rent expense for the years ended December 31, 2015, 2014 and 2013 was $0.7 million, $0.8 million and $0.6 million, respectively.
The Company’s purchase commitments at December 31, 2015 were $0.9 million, which are primarily for the manufacture and testing of active pharmaceutical ingredient (API) or drug product for clinical testing.
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 duration of these indemnification agreements is 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. Accordingly, the Company has not recognized any liabilities relating to these agreements as of December 31, 2015.
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