COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company has been in the past, and continues to be, a party to litigation, which has consumed, and may continue to consume, substantial financial and managerial resources. The Company could incur substantial costs and divert the attention of management and technical personnel in defending against litigation, and any adverse ruling or perception of an adverse ruling could have a material adverse impact on the Company’s stock price. In addition, any adverse ruling could have a material adverse impact on the Company’s cash flows and financial condition. The results of any litigation or any other legal proceedings are uncertain and, as of the date of this report, the Company has not accrued any liability with respect to any of the litigation matters listed below:

Enzo Litigation

Southern District of New York Case: On October 28, 2003, Enzo Life Sciences, Inc., a wholly-owned subsidiary of Enzo Biochem, Inc. (collectively "Enzo"), filed a complaint against the Company that is pending in the United States District Court for the Southern District of New York for breach of contract, injunctive relief and declaratory judgment. The Enzo complaint relates to a 1998 distributorship agreement with Enzo under which the Company served as a non-exclusive distributor of certain reagent labeling kits supplied by Enzo. On November 10, 2003, the Company filed a complaint against Enzo in the United States District Court for the Southern District of New York for declaratory judgment, breach of contract and injunctive relief relating to the 1998 agreement. On April 22, 2014, the Company entered into a settlement agreement with Enzo with respect to these two lawsuits. Pursuant to the agreement, the Company agreed to pay Enzo $5.1 million and recorded the litigation settlement charge within the results of operations in the first three months of 2014. The settlement agreement does not include the Delaware Case described below.

Delaware Case: On April 6, 2012, Enzo filed a complaint against the Company in the United States District Court for the District of Delaware. In the complaint, plaintiff alleges that Affymetrix is infringing U.S. Patent No. 7,064,197 by making and selling certain GeneChip® products. The plaintiff seeks a preliminary and permanent injunction enjoining the Company from further infringement and unspecified monetary damages. On October 9, 2015, the Company entered into a settlement agreement with Enzo with respect to this lawsuit. Pursuant to the agreement, the Company agreed to pay Enzo $10.0 million. The Company evaluated the transaction as a multiple-element arrangement and allocated the one-time payment to each identifiable element using its relative fair value. Based on these estimates of fair value, the Company determined that the primary benefit of the arrangement is avoided litigation cost and the release of any potential past claims, with no material value attributable to future use or benefit. Accordingly, the Company recorded the litigation settlement charge within the results of operations in the three and nine months ended September 30, 2015.

Administrative Proceedings

The Company’s intellectual property is subject to a number of significant administrative actions. These proceedings could result in the Company’s patent protection being significantly modified or reduced, and the incurrence of significant costs and the consumption of substantial managerial resources. For the three and nine months ended September 30, 2015 and 2014, the Company did not incur significant costs in connection with administrative proceedings.

Leases

On September 23, 2015, the Company extended its lease with Keppel Logistics Pte Ltd. for the Singapore facility for a period of five years. The lease extension will commence on January 1, 2016 and expire on December 31, 2020.

Future minimum lease obligation, net of sublease income, as of September 30, 2015 under the lease extension mentioned above are as follows (in thousands):



For the Year Ending December 31,	Amount
2015, remainder thereof	$	—
2016	1,400
2017	1,400
2018	1,426
2019	1,426
Thereafter	1,426
Total	$	7,078