8.	Commitments and Contingencies

Operating Leases

The Company leases office and has leased lab space and equipment under various operating lease agreements. Rent expense under the operating leases amounted to ($9.1) million, $4.1 million and $9.4 million for the years ended December 31, 2015, 2014 and 2013, respectively. For the year ended December 31, 2014, $3.1 million of rent expense is included within lease exit costs on the Company’s statement of operations. The net rent credit for the year ended December 31, 2015 and the net rent credit for the years ended December 31, 2014 and 2013 were recorded within operating expenses and allocated to research and development and general and administrative expense based upon the use of the underlying facility space.

In May 2015, the Company began leasing office space under a cancellable arrangement. The Company recognized rent expense of approximately $0.2 million related to this lease during the year ended December 31, 2015.

On May 9, 2012, the Company entered into a lease agreement with BMR-650 E KENDALL B LLC (“BMR”), under which the Company agreed to lease 126,065 square feet of space located at 650 East Kendall Street, Cambridge, Massachusetts to be used for office, research and laboratory space. The initial term of the lease agreement was approximately twelve years and seven months (the “initial term”). The Company has determined that the lease should be classified as an operating lease.

In order to make the space usable for the Company’s operations, substantial improvements were made to the space. These improvements were planned, managed and carried out by the Company and the improvements were tailored to the Company’s needs. BMR agreed to reimburse the Company for up to $14.9 million of the improvements, and the Company bore all risks associated with any cost overruns that may be incurred. As such, the Company determined it was the owner of the improvements and, as such, the Company accounted for tenant improvement reimbursements from BMR as a lease incentive. The Company recorded a deferred lease incentive (included as a component of the deferred rent balance in the accompanying consolidated balance sheets) and the incentive was amortized as an offset to rent expense over the term of the lease. Rent expense, inclusive of the escalating rent payments, was recognized on a straight-line basis over the initial term of the lease agreement. Refer to Footnote 14 for further discussion regarding the termination of this lease. The Company recognized rent expense of approximately ($9.5) million, $4.3 million and $6.7 million related to the lease during the years ended December 31, 2015, 2014 and 2013, respectively. The expense recognized during the years ended December 31, 2015 and 2014 include the recognition of deferred rent credits totaling $10.6 million and $3.8 million, respectively, following the termination of the lease agreement.

Employment Agreements

Certain key executives are covered by severance and change in control agreements. Under these agreements, if the executive’s employment is terminated without cause or if the executive terminates his employment for good reason, such executive will be entitled to receive severance equal to his base salary, benefits and prorated bonuses for a period of time equal to either 12 months or 18 months, depending on the terms of such executive’s individual agreement. In addition, in December 2007, the Company approved a key employee change in control severance benefits plan, which was amended in November 2009, and which provides for severance and other benefits under certain qualifying termination events upon a change in control for a period of time ranging from 6 months to 18 months, depending upon the position of the key employee.

Refer to Footnote 16 for further discussion of legal contingencies.