10. Commitments and Contingencies

Lease Commitments

We lease offices and automobiles under agreements that expire at various dates through 2013. Total office rent expense for the years ended December 31, 2011, 2010 and 2009 was $759,000, $743,000 and $786,000, respectively.

The aggregate future minimum rental commitments as of December 31, 2011, for non-cancelable operating leases with initial or remaining terms in excess of one year are as follows:


Year Ending December 31:
2012	$	1,063
2013		126
2014		22
Total	$	1,211

Royalty and License Fee Commitments

In December 2002, we entered into the FOLTOYN License Agreement with Sloan-Kettering Institute for Cancer Research, SRI International and Southern Research Institute, as amended, under which we obtained exclusive worldwide rights to a portfolio of patents and patent applications related to FOLOTYN and its uses. Under the terms of the FOLOTYN License Agreement, we paid an up-front license fee of $2.0 million upon execution of the agreement and have made aggregate milestone payments of $2.5 million based on the passage of

time. Additionally, in May and September 2009, we made milestone payments of $1.5 million based on the FDA accepting our New Drug Application for review and $5.8 million based on the FDA approval to market FOLOTYN, respectively. The up-front license fee and all milestone payments under the FOLOTYN License Agreement prior to FDA approval to market FOLOTYN were recorded to research and development expense as incurred. As discussed in Note 7, the $5.8 million milestone payment based on the FDA approval was capitalized as an intangible asset and is being amortized over the expected useful life of the composition of matter patent for FOLOTYN, which we expect to last until July 16, 2022. The only remaining potential milestone payment under the FOLOTYN License Agreement is for $3.5 million upon regulatory approval to market FOLOTYN in Europe, which, if made would be capitalized and amortized over the expected useful life of the licensed patents.

Under the terms of the FOLOTYN License Agreement, we also owe the licensors sublicense fees equal to 20% of any milestone payments received from Mundipharma. As discussed above, during the year ended December 31, 2011, we paid $10.0 million of sublicense fees to the licensors. In the event we obtain conditional approval of FOLOTYN in Europe, we would receive a potential milestone from Mundipharma of $14.5 million under the Mundipharma Collaboration Agreement, of which $5.7 million would be payable by us to the licensors under the terms of the FOLOTYN License Agreement. The $5.7 million is comprised of the $3.5 million milestone payment discussed above and $2.2 million of sublicense fees (or 20% of $14.5 million less $3.5 million). Upon the first reimbursable commercial sale of FOLOTYN in at least three major market countries in the European Union, we would receive a milestone payment from Mundipharma of $10.0 million, of which $2.0 million would be payable by us to the licensors.

Under the terms of the FOLOTYN License Agreement, we are required to fund all development programs and will have sole responsibility for all commercialization activities. In addition, we pay the licensors royalties based on worldwide graduated annual levels of net sales of FOLOTYN, net of actual rebates, chargebacks and returns, or distributor sales, which may be different than our net product revenue recognized in accordance with U.S. generally accepted accounting principles, or GAAP, or sublicense revenues arising from sublicensing the product, if and when such sales or sublicenses occur. For purposes of the FOLOTYN License Agreement, annual worldwide sales consists of our distributor sales and annual net sales of FOLOTYN in the Mundipharma Territories, as reported to us under the Mundipharma Collaboration Agreement, if and when such sales occur in the Mundipharma Territories. Royalties are 8% of annual worldwide sales up to $150.0 million; 9% of annual worldwide sales of $150.0 million through $300.0 million; and 11% of annual worldwide sales in excess of $300.0 million. In 2011, 2010 and 2009, our royalties were 8% of our net distributor sales.

Contingencies

We enter into indemnification provisions under our agreements with other companies in our ordinary course of business, typically with business partners, contractors, clinical sites and suppliers. Under these provisions we generally indemnify and hold harmless the indemnified party for losses suffered or incurred by the indemnified party as a result of our activities or the use of our product candidates. These indemnification provisions generally survive termination of the underlying agreement. The maximum potential amount of future payments we could be required to make under these indemnification provisions is unlimited. We have not incurred material costs to defend lawsuits or settle claims related to these indemnification agreements. The estimated fair value of the indemnification provisions of these agreements is minimal as of December 31, 2011, and accordingly, we have no corresponding liabilities recorded as of December 31, 2011.

In accordance with the Mundipharma Collaboration Agreement, we have a $14,777,000 contingent payment obligation related to the development cost differential, which is included in long-term deferred revenue and other liabilities in the Balance Sheet. See Note 5 for further discussion.

Merger Transaction Class Action Lawsuits

On July 19, 2011, we entered into an Agreement and Plan of Merger and Reorganization, or Merger Agreement, with AMAG and Alamo Acquisition Sub, Inc., or Merger Sub, as amended on August 8, 2011. On October 21, 2011, the Merger Agreement was terminated.

On July 26, 2011, a putative class action lawsuit captioned Lam v. Allos Therapeutics, Inc., et al., No. 6714-VCN, was filed in the Delaware Court of Chancery. The complaint names as defendants the members of our board of directors, as well as AMAG and Merger Sub. The plaintiff alleges that our directors breached their fiduciary duties to our stockholders in connection with the proposed merger between the Company and AMAG, and were aided and abetted by AMAG and Merger Sub. The complaint alleges that the merger involves an unfair price and an inadequate sales process, unreasonable deal protection devices, and that defendants entered into the transaction to benefit themselves personally. The complaint seeks injunctive relief, including to enjoin the merger, rescissory damages in the event the merger occurs, attorneys' and other fees and costs, and other relief.

On July 28, 2011, a putative class action lawsuit captioned Mulligan v. Allos Therapeutics, Inc., et al., No. 6724-VCN, was filed in the Delaware Court of Chancery. The complaint names as defendants the Company and the members of our board of directors, as well as AMAG and Merger Sub. The plaintiff alleges that our directors breached their fiduciary duties to our stockholders in connection with the proposed merger between the Company and AMAG, and were aided and abetted by the Company, AMAG and Merger Sub. The complaint alleges that the merger involves an unfair price and an inadequate sales process, unreasonable deal protection devices, and that defendants entered into the transaction to benefit themselves personally. The complaint seeks injunctive relief, including to enjoin the merger, rescissory damages in the event the merger occurs, disgorgement of profits, attorneys' and other fees and costs, and other relief.

On August 1, 2011, the Delaware Court of Chancery consolidated the Lam and Mulligan cases into In Re Allos Therapeutics, Inc. Shareholders Litigation, Consolidated C.A. No. 6714.

On August 15, 2011, a putative class action lawsuit captioned Gaines v. Narachi, et al., No. 6784-VCN, was filed in the Delaware Court of Chancery. The complaint names as defendants the Company, AMAG, and the members of AMAG's board of directors. The plaintiff alleges that AMAG's directors breached their fiduciary duties to AMAG's stockholders in connection with the proposed merger between the Company and AMAG, and were aided and abetted by the Company. The complaint alleges that the merger involved an inadequate sales process and unreasonable deal protection devices, that the AMAG board of directors improperly rejected an allegedly superior offer by MSMB Capital Management LLC, and that defendants entered into the transaction to benefit themselves personally. The complaint seeks injunctive relief, including to enjoin the merger, rescissory damages in the even the merger occurs, disgorgement of profits, attorneys' fees and other fees and costs, and other relief.

On September 1, 2011, a Verified Consolidated Amended Class Action Complaint was filed in the consolidated action pending in the Delaware Court of Chancery. The amended complaint names as defendants members of our board of directors, as well as the Company, AMAG and Merger Sub, and alleges that members of our board of directors breached their fiduciary duties to our stockholders in connection with the Merger Agreement and the disclosures related thereto, and further claims that the Company, AMAG and Merger Sub aided and abetted those alleged breaches of fiduciary duty. The amended complaint generally alleges that the Merger Agreement involves an unfair price, a flawed sales process and preclusive deal protection devices and that the defendants agreed to the transaction to benefit themselves personally. The amended complaint further alleges that the joint proxy statement fails to disclose material information relating to the Company's and

AMAG's financial projections, the fairness opinions of J.P. Morgan and Morgan Stanley and the background of the proposed transaction. The amended complaint seeks damages and injunctive relief, including to enjoin the acquisition of the Company by AMAG, and an award of attorneys' and other fees and costs, in addition to other relief.

On October 13, 2011, the Company and other defendants in the consolidated action pending in the Delaware Court of Chancery entered into a memorandum of understanding, or MOU, pursuant to which the Company and such parties agreed in principle, and subject to certain conditions, to settle that action. The settlement contemplated by the MOU was subject to and conditioned upon consummation of the acquisition of the Company by AMAG, which condition was not satisfied.

On October 31, 2011, the Company moved to dismiss the consolidated action pending before the Delaware Court of Chancery. On November 1, 2011, the Company moved to dismiss the Gaines action. No supporting memoranda have been filed, and there is no briefing schedule on these motions.

On December 13, 2011, plaintiffs' counsel in the consolidated Delaware action filed a motion for an award of fees and expenses in connection with certain disclosures made by the Company in connection with the proposed merger with AMAG. On February 1, 2012, the Company filed its opposition to the motion; plaintiffs filed their reply on March 15, 2012. A date for a hearing on the motion has not yet been set.

The Company and other defendants believe the allegations of all the foregoing actions lack merit. Furthermore, inasmuch as the Merger Agreement has been terminated, the Company and other defendants believe such allegations are moot. Defendants will continue to vigorously defend these actions as long as they remain pending.