According to the U.S. Bankruptcy Court docket, KaloBios Pharmaceuticals filed a motion to authorize the Debtor’s entry into and performance under a lease termination agreement with Bayside Acquisition.
Under the agreement, “Based on the current size of the Debtor’s workforce and the Debtor’s outsourcing of most testing and research activities, the Debtor has determined, in the exercise of its business judgment, that it is in the best interest of the Debtor and its estate to terminate the Lease and occupy alternative space. Following the Petition Date, the Debtor and Bayside engaged in good faith, arms’-length negotiations regarding a possible early termination of the Lease.”
The motion continues, “The material terms of the Termination Agreement include Lease Expiration Date amended 11:59 p.m. (PDT) on March 31, 2016. Bayside will release the Debtor from its obligation to pay any rent due for March 2016, including operating expenses and other charges accruing pursuant to the Lease. Bayside has committed to deliver to the Debtor following the early Lease Expiration Date the Letter of Credit in the amount of $142,517.78 and a release of the Letter of Credit in the form annexed to the Termination Agreement….The Debtor’s monthly rent payment under the Lease is approximately $74,000. The Debtor has been actively investigating options for alternate space since shortly after the Petition Date. The Debtor has identified at least two suitable alternatives to the current Premises, each of which would have a rent obligation of less than $25,000 per month.”
The Court scheduled a March 16, 2016 hearing to consider the motion, with objections due by March 9, 2016. Read more KaloBios bankruptcy news.