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Related Parties
 9 Months Ended
Sep. 30, 2023
Related Parties  
Related Parties

Note 18. Related Parties

 

Prior to the Merger, David A Jenkins, the Company’s current Chairman of the Board and interim Chief Executive Officer, and Old Catheter’s then Chairman of the Board of Directors, and his affiliates held approximately $25.1 million of Catheter’s Convertible Promissory Notes, or the Notes, that were converted in the Catheter merger into 7,856.251 shares of Series X Convertible Preferred Stock (see Note 3, Business Combination and Note 13, Preferred Stock). In consideration for forgiving the interest accrued but remaining unpaid under the Notes in an aggregate amount of approximately $13.9 million, Mr. Jenkins and his affiliates also received royalty rights equal to approximately 12% of the net sales, if any, of LockeT, commencing upon the first commercial sale and through December 31, 2035 (see Note 9, Royalties Payable).

 

In addition to the shares described above that were issued in connection with the Notes, Mr. Jenkins and his affiliates received 1,325.838 shares of Series X Convertible Preferred Stock in the merger, and Mr. Jenkins’ adult children received 1,284.344 shares of Series X Convertible Preferred Stock in the merger, all in exchange for their equity interests in Catheter in accordance with the merger exchange ratio. 

 

In connection with the Merger (see Note 3, Business Combination), the Company assumed $1.4 million of accrued expenses, of which $1.1 million was due to Mr. Jenkins and was paid on January 10, 2023.

 

Mr. Jenkins’ daughter, the Company’s Chief Operating Officer, received options to purchase 144,169 shares of the Company’s common stock upon the closing of the merger in exchange for her options to purchase shares of Catheter common stock, converted based on the exchange ratio in the merger. Of the total options to purchase 144,169 shares of the Company’s common stock, 140,816 options have an exercise price of $0.59 per share, and the remaining 3,353 options have an exercise price of $2.02 per share.

 

Following stockholder approval on March 21, 2023, the Company issued 991,828 shares of common stock to Mr. Jenkins and affiliates upon conversion of 991.828 shares of Series X Convertible Preferred Stock, and 235,320 shares of common stock to his adult children upon conversion of 235.320 shares of Series X Convertible Preferred Stock.