Related Party Transactions
|9 Months Ended|
Sep. 30, 2020
|Related Party Transactions [Abstract]|
|Related Party Transactions||
Note 8 – Related Party Transactions
Effective February 1, 2019, the Company entered into an oral consulting agreement with Mr. Raymond Monteleone, Board Member and Chairman of the Audit Committee, in which Mr. Monteleone received $10,000 per month for advisory services and $5,000 per quarter as Audit Committee Chair in addition to regular quarterly board meeting fees. Effective March 25, 2020, the Company reduced the advisory services to $5,000 per month and the fees per quarter as the Audit Committee Chair to $2,500. For the three and nine months ended September 30, 2020, the Company expensed approximately $17,500, and $65,000 in compensation to Mr. Monteleone, respectively. For the three months and nine months ended September 30, 2019, the Company expensed approximately $35,000 and $90,000 in compensation to Mr. Monteleone, respectively.
The Company entered into an oral consulting arrangement with St. Louis Family Office, LLC, controlled by Jimmy St. Louis, former CEO of RMS, in January 2019 in the amount of $10,000 per month plus benefits reimbursement for advisory services. The Company terminated this agreement effective June 30, 2019. For the three and nine months ended September 30, 2020, the Company had no consulting fees expense for St. Louis Family Office. For the three and nine months ended September 30, 2019, the Company expensed approximately $0 and $71,000 respectively in consulting fees to St. Louis Family Office.
The Company entered into a consulting agreement with Strategos Public Affairs, LLC (Strategos) on February 15, 2019 for a period of twelve months, unless otherwise terminated by giving thirty days prior written notice. A close family member of the Company’s CEO is a partner in Strategos. The monthly fee started at $4,500 and increased to approximately $7,500 per month. Strategos provided information to key policymakers in the legislature and executive branches of government on the benefits of the cellular therapies offered by LHI, advocated for legislation that supports policies beneficial to patient access and opposed any legislation that negatively impacts the Company’s ability to expand treatment opportunities, and position the Company and its related entities as the expert for information and testimony. The Company terminated this agreement in March 2020. For the three and nine months ended September 30, 2020, the Company expensed approximately $0 and $15,000, respectively. For the three and nine months ended September 30, 2019, the Company expensed approximately $23,000 and $49,000, respectively.
Officers and Board Members and Related Expenses
In connection with the April Offering, the Company’s CEO, William Horne, entered into an amendment letter to his employment agreement which provides that his salary will be reduced to $0 per month. This agreement was amended on July 29, 2020 to provide that Mr. Horne will receive a monthly base salary of $12,500 effective on June 1, 2020 and that his base salary will increase to $20,833 per month upon the first day of the month when the Company completes a Qualified Financing. Mr. Horne agreed to continue to defer the $108,000 in base salary deferred by him in 2018 (the “Deferred Salary”) until such time as there is a positive cash flow to meet the Company’s financial obligations and then the Company and Mr. Horne will work together in good faith to negotiate a payment plan for such Deferred Salary. On September 29, 2020, Mr. William Horne resigned as the Company’s Chief Executive Officer and President but will remain Chairman of the Board of Directors.
For the three and nine months ended September 30, 2020, the Company paid no Board of Director fees to Michael Yurkowsky or to Raymond Monteleone. For the three and nine months ended September 30, 2019, the Company paid $0 and $10,000, respectively, in Board of Director fees to Michael Yurkowsky and to Raymond Monteleone.
Debt and Other Obligations
The short-term notes, related parties are detailed in Note 3 - “Liquidity, Going Concern and Management’s Plans” in this Form 10-Q.
The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef