Commitments and Contingencies

12 Months Ended

Dec. 31, 2011

Commitments and Contingencies [Abstract]

Commitments and Contingencies

12. Commitments and Contingencies

The Company’s corporate office lease expired on September 30, 2011. The Company is currently a tenant at will occupying approximately 4,500 square feet of office space. The Company’s former corporate office lease was subleased and scheduled to expire in May 2012, but was terminated early in May 2011 (Note 8).

Total rent expense was approximately $220,000 and $270,000 for the years ended December 31, 2011 and 2010, respectively and approximately $4,044,000 for the period from inception (October 16, 1992) through December 31, 2011. The Company received approximately $102,000 and $244,000 for the years ended December 31, 2011 and 2010, respectively, related to the sublease of the premises.

On March 13, 2012 the Company received notice that Children’s Hospital Boston and Children’s Medical Center Corporation had filed a lawsuit in Middlesex Superior Court, Middlesex County, Massachusetts seeking to recover amounts alleged to be owed by the Company to the plaintiffs totaling $642,906. The Company does not agree that the total amounts claimed in the lawsuit are in fact owed and will pursue all legal remedies available to it to defend this claim.

License Agreements

The Company has entered into license agreements (the “Harvard License Agreements”) with Harvard University and its affiliated hospitals (“Harvard and its Affiliates”) to acquire the exclusive worldwide rights to certain technologies within its molecular imaging and neurodegenerative disease programs. The Harvard License Agreements obligate the Company to pay up to an aggregate of approximately $850,000 in milestone payments in the future. The future milestone payments are generally payable only upon achievement of certain regulatory milestones. The Company’s license agreements with Harvard and its Affiliates generally provide for royalty payments equal to specified percentages of product sales, annual license maintenance fees and continuing patent prosecution costs.

Guarantor Arrangements

The Company has entered into agreements to indemnify its executive officers and directors for certain events or occurrences while the officer or director is, or was serving, at the Company’s request in such capacity. The indemnification period is for the officer’s or director’s lifetime. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a director and officer insurance policy that limits the Company’s exposure and enables the Company to recover a portion of any future amounts paid. As a result of the Company’s insurance policy coverage, the Company believes the estimated fair value of these indemnification agreements is minimal.

S. David Hillson our former Chairman of the Board and Chief Executive Officer requested that the Company create an indemnity trust for his benefit and fund the trust in the amount of $100,000. On June 15, 2004, the Company entered into a directors and officers indemnity trust agreement with Mr. Hillson and Boston Private Bank & Trust Company, as trustee (the “Indemnity Trust Agreement”), and funded the trust with $100,000. In December 2011, Mr. Hillson signed a blanket release of the indemnity trust funds. As of December 31, 2011 those funds have been reclassified to cash and cash equivalents in the Consolidated Balance Sheet.

The Company enters into arrangements with service providers to perform research, development, and clinical services. The Company enters into standard indemnification agreements with those service providers, whereby the Company indemnifies them for any liability associated with their use of the Company’s technologies. The maximum potential amount of future payments the Company would be required to make under these indemnification agreements is unlimited; however, the Company has product liability and general liability policies that enable the Company to recover a portion of any amounts paid. As a result of the Company’s insurance policy coverage, the Company believes the estimated fair value of these indemnification agreements is minimal.