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COMMITMENTS AND CONTINGENCIES | 6 Months Ended
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Sep. 30, 2015
COMMITMENTS AND CONTINGENCIES [Text Block] |
8. | COMMITMENTS AND CONTINGENCIES
(a) | The Company entered into a license agreement with Advanced NeuroRehabilitation, LLC (“ANR”) for an exclusive right on ANR’s patent pending technology, claims and knowhow. In addition to the issuance of 16,035,026 shares, the Company agreed to pay a 4% royalty on net revenue on the sales of devices covered by the patent-pending technology and services related to the therapy or use of devices covered by the patent-pending technology.
(b) | On March 7, 2014, the Company entered into a commercial development-to-supply program with Ximedica where Ximedica will design, develop and produce PoNS product solution suitable for clinical trial and commercial sale. Under the program, the Company is responsible for ensuring the device is in compliance with relevant laws and regulations. The agreed budget for phase 1B of development is $499,000 ; phase 2 is $1,065,000 ; Phase 3 and 4 is $1,389,000 and 2 nd software development cycle is $586,000, of which $4,147,423 was expensed as research and development since inception to September 30, 2015. Invoices are to be issued monthly for work in progress. The Company can cancel the project at any time with a written notice at least 30 days prior to the intended date of cancellation. As of September 30, 2015, the Company recorded a prepaid expense of $300,000 to Ximedica which will be applied at the end of the project. During the period ended September 30, 2015, the Company incurred charges of $797,425 (September 30, 2014 - $1,544,291) pursuant to this agreement.
(c) | On January 27, 2015 we received a demand letter containing allegations that we had entered into a consulting arrangement with the complainants and breached certain of its terms, and used certain intellectual property in the form of business and marketing plans allegedly prepared by the complainants, and seeking damages. On May 7, 2015, Mr. Rainer Maas and Dr. Jochen Scheld filed a complaint in the U.S. District Court for the Eastern District of Pennsylvania seeking monetary damages. Document discovery ends on October 23, 2015, a settlement conference with the magistrate judge is scheduled for December 2, 2015, discovery ends on February 26, 2016, and trial is scheduled for April 8, 2016. Management estimates that the contingent liability of such claim to be immaterial.

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