Item 1.02
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Termination of a Material Definitive Agreement.
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784 Memorial Drive Lease
On September 25, 2014, Infinity Pharmaceuticals, Inc. (
we
,
us
, or
our
) entered into a lease agreement (the
Base Lease
) with BHX, LLC, as trustee of 784 Realty Trust (the
Landlord
), for the lease of approximately 61,000 square feet of office space at 784
Memorial Drive, Cambridge, Massachusetts. On March 27, 2017, we and the Landlord entered into an amendment (the
Lease Termination
Amendment
) to the Base Lease under which we and Landlord agreed to the
early termination of the Base Lease subject to the satisfaction or waiver of specified contingencies (the
Lease Termination Contingencies
) and payment of a $5 million termination payment (the
Termination
Payment
). The Lease Termination Amendment was extended by entry into a second lease amendment dated May 1, 2017 and further extended by entry into a third lease amendment dated May 31, 2017.
The Base Lease, as amended, will terminate effective August 31, 2017 following satisfaction of the Lease Termination Contingencies on
June 15, 2017 by our receipt of notice from the Landlord that it has waived a contingency to enter into a new lease or leases on or before June 15, 2017 and by our receipt of a Qualifying Lender Consent as described in the Lease
Termination Amendment. Pursuant to the Lease Termination Amendment, as amended, we made the first installment of the Termination Payment to Landlord on June 19, 2017 in the amount of $4.5 million and are obligated to make the final
installment of the termination payment to Landlord in the amount of $0.5 million on or before August 31, 2017.
The Base Lease
commenced on November 1, 2014 (the
Commencement Date
) and was originally scheduled to expire on March 31, 2025, (the
Expiration Date
). Under the terms of the Base Lease, we had agreed to pay rent from
the Commencement Date until April 1, 2015, at a rate of $0.00 per month, from April 1, 2015 through March 31, 2020, at a rate of $170,291.67 per month, and from April 1, 2020 until the Expiration Date, at a rate of $190,625.00
per month. In addition to the base rent, we had agreed to be responsible for Building operating expenses, utility costs and real estate taxes, in accordance with the terms of the Base Lease. Pursuant to the terms of the Base Lease, we provided a
security deposit in the form of a letter of credit in the initial amount $1,000,000, which was reduced to $500,000 on April 4, 2017 according to the terms of the Base Lease. We had two consecutive rights to extend the term of the Base Lease for
five years under each extension. The Base Lease contained customary provisions allowing the Landlord to terminate the Base Lease if we failed to remedy a default of any of its obligations under the Base Lease within specified time periods or upon
our bankruptcy or insolvency.