Quarterly report pursuant to Section 13 or 15(d)

3. Accrued Expenses and Accounts Payable - Related Parties

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3. Accrued Expenses and Accounts Payable - Related Parties
3 Months Ended
Mar. 31, 2017
Related Party Transactions [Abstract]  
Accrued Expenses and Accounts Payable - Related Parties

Accrued expense – related parties consists accrued salaries of officers and fees due to members of the Board of Directors.

 

On April 1, 2017, the Company executed a separation agreement and release effective with the Company’s Chief Executive Officer (CEO). As part of the agreement, the Company agreed to pay the CEO $580,000 in severance, payable in equal installment over 24 months. In addition, the Company also agreed to pay the CEO’s medical insurance for 24 months and provide use of a cell phone for 12 months with an estimated cost of $44,000. As a result, the Company accrued the entire $624,000 as of March 31, 2017 which was also reported as part of Operating Expenses in the accompanying consolidated statements of operations.

 

As of March 31, 2017 and December 31, 2016, accrued expenses and accounts payable to related parties amounted to $797,000 and $135,000, respectively.