Quarterly report pursuant to Section 13 or 15(d)

Related Party Transactions

v3.6.0.2
Related Party Transactions
9 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
Related Party Transactions

Cato Holding Company (CHC), doing business as Cato BioVentures (CBV), is the parent of Cato Research Ltd (CRL). CRL is a contract research, development and regulatory services organization (CRO) engaged by us for certain aspects of the development of AV-101. CBV is among our largest institutional stockholders at December 31, 2016, holding approximately 7.0% of our outstanding common stock. In October 2012 we issued certain unsecured promissory notes in the aggregate face amount of approximately $1.3 million to CBV and CRL (the Cato Notes) as payment in full for all contract research and development services and regulatory advice previously rendered to us by CRL. The Cato Notes and additional amounts payable to CRL for CRO services were extinguished in June 2015 in exchange for our issuance of an aggregate of 328,571 shares of Series B Preferred to CBV, which shares of Series B Preferred were automatically converted into an equal number of registered shares of our common stock in connection with the May 2016 Public Offering.

 

Under the terms of our CRO arrangement with CRL related to the development of AV-101, we incurred expenses of $101,900 and $19,400 for the quarters ended December 31, 2016 and 2015, respectively, and $180,100 and $41,500 in the nine month periods ended December 31, 2016 and 2015, respectively. Total interest expense, including amortization of note discount, on the Cato Notes was $28,200 for the three-month period ended June 30, 2015 during which the notes were extinguished.

 

University Health Network (UHN) holds approximately 2.0% of our outstanding common stock at December 31, 2016. As described more completely in Note 5, Sublicense Fee Receivable and Sublicense Revenue, in December 2016, we entered into certain agreements with UHN pursuant to which we acquired two exclusive patent licenses from UHN and became obligated to make a payment to UHN with respect to our sublicense to BlueRock Therapeutics of cardiac stem cell production technology licensed to us by UHN. At December 31, 2016, we had recorded a liability to UHN of $233,400 related to these agreements. In the nine months ended December 31, 2015, we had incurred approximately $153,000 related to the acquisition of three stem cell technology licenses from UHN.