Entry into a Material Definitive Agreement, Creation of a Direct Financi
Item 1.01 Entry into a Material Definitive Agreement. On May 9, 2011, Seattle Genetics, Inc. (the "Company") entered into a Lease, dated May 9, 2011, with WCM Highlands II, LLC, for approximately 81,000 square feet of office space in a building at 21717 30th Drive SE, Bothell, WA 98021 (the "21717 Lease"). The Company intends to use the additional space to expand its operations and business. The term of the 21717 Lease runs for 84 months, commencing on July 1, 2011 (the "Commencement Date"). The approximate aggregate base rent due over the initial term of the 21717 Lease is $7,684,875. Subject to certain conditions, the Company has two (2) options to extend the 21717 Lease for a period of five (5) years each.
Also on May 9, 2011, the Company entered into a Third Amendment to Lease with B&N 141-302, LLC with respect to the Company's current office space at 21823 30th Drive SE, Bothell, WA (the "Amendment," and as amended, the "21823 Lease"). The original 21823 Lease, dated as of December 1, 2000, was previously filed as an exhibit to the Company's registration statement on Form S-1, filed on November 20, 2000. The Amendment removes certain of the Company's rights to terminate the 21823 Lease earlier than the end of the current term.
The foregoing description of the 21717 Lease and the Amendment does not purport to be complete and is qualified in its entirety by the terms and conditions of the 21717 Lease and the Amendment, which will be filed as exhibits to the Company's quarterly report on Form 10-Q for the period ending June 30, 2011.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. The information set forth in Item 1.01 above with respect to the 21717 Lease is incorporated by reference herein.
I do not believe that restrictions would be made on disclosure of rental leases by the FDA. This has possibly something to do with a partnership that SGEN has entered into or is about to enter into. Either way it is what I believe is why SGEN went up in a down market on Friday.
Interesting that SGEN was nearing it's 52 week high in a down market. We have 9,380 shares with an average price of 8 1/4 purchased three years ago. Patience is our motto and will not trade this in and out. SGEN just may be a front runner to combat cancer with it;s unique approach.
SGEN is my only speculative biotech, it's a field I'm not really familiar with (perhaps it's foolish for me to not be invested in a larger biotech but a little risk is fun in my book). Can SGEN exit this lease if they need to? I'm not sure how this stuff works...it seems a company would have to be REALLY sure about approval for 81K square feet of office space, right?