• Filing Date: 2016-03-30
  • Form Type: 10-K
  • Description: Annual report
v3.3.1.900
RELATED PARTY TRANSACTIONS
12 Months Ended
Dec. 31, 2015
RELATED PARTY TRANSACTIONS
8.    RELATED PARTY TRANSACTIONS
 
Lease and Sub-Lease Agreement
 
As noted above, Capricor Therapeutics is party to lease agreements with CSMC, which holds more than 10% of the outstanding capital stock of Capricor Therapeutics (see Note 6 – “Commitments and Contingencies”). Additionally, Dr. Eduardo Marbán, who holds more than 10% of the outstanding capital stock of Capricor Therapeutics, is the Director of the Cedars-Sinai Heart Institute, the Co-Founder of Capricor and the Chairman of Capricor’s Scientific Advisory Board.
 
Beginning May 1, 2012, pursuant to a sublease agreement, Capricor subleased part of its office space to Frank Litvack, the Company’s Executive Chairman and a member of its Board of Directors, for $2,500 per month. On April 1, 2013, Capricor entered into a sublease with Reprise Technologies, LLC, a limited liability company which is wholly owned by Dr. Litvack, for $2,500 per month. The sublease is on a month-to-month basis. For both the years ended December 31, 2015 and 2014, Capricor recognized $30,000 in sublease income from the related party. Sublease income is recorded as a reduction to general and administrative expenses.
 
Consulting Agreements
 
Effective January 1, 2013, Frank Litvack, the Company’s Executive Chairman and a member of its Board of Directors, entered into an oral Consulting Agreement with Capricor whereby Capricor agreed to pay Dr. Litvack fees of $10,000 per month for consulting services. On March 24, 2014, Capricor entered into a written Consulting Agreement with Dr. Litvack memorializing the $10,000 per month compensation arrangement described above. The agreement is terminable upon 30 days’ notice.
 
Payables to Related Party
 
At December 31, 2015 and 2014, the Company had accounts payable and accrued expenses to related parties totaling $352,334 and $433,712, respectively. CSMC accounts for approximately $352,334 and $421,328 of the total accounts payable and accrued expenses to related parties as of December 31, 2015 and 2014, respectively. CSMC expenses relate to the ongoing clinical trials costs and deferred rent on our research lab space.