Restructuring Activities |
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| Restructuring Activities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| RESTRUCTURING ACTIVITIES |
6. RESTRUCTURING ACTIVITIES
On August 21, 2008, Sonus completed a transaction, or “the Arrangement,” with OncoGenex
Technologies whereby Sonus acquired all of the outstanding preferred shares, common shares and
convertible debentures of OncoGenex Technologies. Sonus then changed its name to OncoGenex
Pharmaceuticals, Inc. Prior to the Arrangement, Sonus entered into a non-cancellable lease
arrangement for office space located in Bothell, Washington, which is considered to be in excess of
the Company’s current requirements. The
Company is currently in the process of evaluating opportunities to exit or sublet portions of the
leased space and recorded an initial restructuring charge of $2,084,000 on August 21, 2008 as part
of the purchase price allocation. The liability is computed as the present value of the difference
between the remaining lease payments due less the estimate of net sublease income and expenses and
has been accounted for in accordance with the then effective EITF No. 95-3, “Recognition of
Liabilities in Connection with a Purchase Business Combination.” This represents the Company’s best
estimate of the liability. Subsequent changes in the liability due to changes in estimates of
sublease assumptions are recognized as adjustments to restructuring charges.
In June 2009, the Company revised its sublease income assumptions used to estimate the excess lease
facility liability. These assumptions were subsequently revised again in December 2009 and
September 2010. These changes in estimate resulted in increases in the value of the excess lease
liability of $494,000, $3,457,000, and $4,038,000 and a corresponding expense recorded in June
2009, December 2009, and September 2010, respectively, to reflect these changes in estimate. The
estimated value of the liability remaining with respect to excess facilities was $7,467,000 as of
December 31, 2010. In the nine months ended September 30, 2011, with respect to excess facilities,
$252,000 was amortized into income resulting in a remaining liability of $7,215,000 at September
30, 2011.
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