Table of Contents
Notes to Consolidated Financial Statements (Continued)
18. Related Party Transactions (Continued)
March 7, 2014, the Company entered into a Services Agreement (the "Services Agreement") with PBM to engage PBM for certain scientific and technical consultation, accounting
and back office support services. The Company agreed to pay PBM $205,000 annually for these services. The agreement had an initial term of 18 months but was terminated on September 7,
2014. The Company recognized $103,180 of expense related to the Services Agreement during the year ended December 31, 2014 and nine months ended September 30, 2014 (unaudited) and these
amounts are included within general and administrative expense in the Company's consolidated statements of operations.
January 2014, the Company granted 1,691,588 restricted shares of common stock to a member of the Company's Board of Directors pursuant to a consulting agreement for scientific
advisory services to be performed by the Board member on behalf of the Company (see Note 12). Additionally, such Board member and consultant is a full time employee of NCH (see Note 20). The
Company reimbursed the consultant $33,088 for the legal fees incurred in connection with the negotiation of the consulting agreement. The inventors of the licensed NCH intellectual property, which
include the consultant, are entitled to a certain share of the revenues received by NCH under the Nationwide License.
March 17, 2014, the Company entered into the Letter Agreement with, and granted common stock warrants to, Pavilion (see Note 12). The principal of Pavilion is an
employee of PBM.
stockholders of the Company, who are each affiliated with a director of the Company and who collectively beneficially own, as defined by SEC rules, 14.7% (unaudited) of the
Company's common stock on an as-converted basis, are also significant stockholders of ReGenX. One of these stockholders is also affiliated with a member of the board of directors of ReGenX. As such,
ReGenX is currently deemed to be a related party. However, the stockholder affiliated with the ReGenX director was not a stockholder of the Company, nor was it affiliated with a director of the
Company, at the time the ReGenX License (see Note 5) was executed.
19. Supplemental Disclosure of Non-cash Activities
On February 1, 2014, the Company issued an outside vendor 15,000 shares of common stock to settle outstanding fees of $51,150 for legal services provided by the vendor to the
August 8, 2014, the Company entered into a Stock Purchase and Conversion Agreement with the same vendor. Under the terms of the agreement, the Company issued to the vendor an
additional 15,000 shares of its common stock in exchange for the settlement of an additional $51,150 in outstanding fees and expenses owed to it by the Company.
under the terms of the agreement with the vendor, each share of common stock held by the vendor will automatically convert into one share of Class B-1 preferred
stock immediately prior to the consummation of a liquidation event (as such term is defined in the Company's Amended and Restated Certificate of Incorporation). The conversion provision will
automatically expire upon the consummation of a firm commitment underwritten public offering of shares of the Company's common stock with aggregate net proceeds to the Company of at least $35,000,000.