Annual report pursuant to Section 13 and 15(d)

RELATED PARTY TRANSACTIONS

v3.22.1
RELATED PARTY TRANSACTIONS
12 Months Ended
Dec. 31, 2021
RELATED PARTY TRANSACTIONS [Abstract]  
RELATED PARTY TRANSACTIONS

9.

RELATED PARTY TRANSACTIONS

 

The Company leases an office building and equipment from Areth, LLC (“Areth”) pursuant to an agreement for services effective as of January 1, 2016, as amended from time to time. Effective October 1, 2017, monthly rent on this facility was reduced to $10,000. On September 27, 2018, the agreement was amended to extend the term of the agreement through September 30, 2019. On November 7, 2019, an additional amendment was entered into between Areth and the Company to extend the term of this agreement through September 30, 2020, and to provide for automatic one-year renewals unless ADMA gives written notice of termination to Areth 60 days prior to the end of the term. The Company did not provide such written notice to Areth as of July 31, 2021. Rent expense for the years ended December 31, 2021 and 2020 amounted to $0.1 million. Areth is a company controlled by Dr. Jerrold B. Grossman, the Vice Chairman of the Company’s Board of Directors, and Adam S. Grossman, the Company’s President and Chief Executive Officer. The Company also reimburses Areth for office, warehousing and building related (common area) expenses, equipment and certain other operational expenses, which were not material to the consolidated financial statements for the years ended December 31, 2021 and 2020.

 

During the years ended December 31, 2021 and 2020, the Company purchased certain specialized medical equipment and services related to the Company’s plasma collection centers, as well as personal protective equipment, from GenesisBPS and its affiliates (“Genesis”) in the amount of $0.2 million and $0.1 million, respectively. Genesis is owned by Dr. Grossman and Adam Grossman.



See Notes 7 and 17 for a discussion of the Company’s credit facility and related transactions with Perceptive, a holder of more than 5% of the Company’s common stock.

During the year ended December 31, 2021, in connection with the resignation of Dr. James Mond, the Company’s former Chief Scientific and Medical Officer, the Company recognized an expense and corresponding liability in the amount of $0.8 million for payments to be made under a separation and transition agreement with Dr. Mond. Such payments are to be made in scheduled installments over a period of 10 months.


In connection with the 2021 public offering of the Company’s common stock (see Note 8) on October 25, 2021: (i) Mr. Grossman purchased 100,000 shares of common stock directly and 250,000 shares of common stock indirectly through an entity he controls, (ii) Dr. Grossman purchased 100,000 shares of common stock, (iii) Dr. Young Kwon, a member of the Company’s Board of Directors, purchased 100,000 shares of common stock, and (iv) Brian Lenz, the Company’s Executive Vice President and Chief Financial Officer, purchased 30,000 shares of common stock, all at the public offering price of $1.00 per share.


In connection with the 2020 public offering of the Company’s common stock (see Note 8) on February 11, 2020: (i) Perceptive Advisors, a principal stockholder of ADMA, purchased 4,563,700 shares of common stock through one of its affiliates, (ii) Dr. Grossman purchased 22,857 shares of common stock directly and 22,857 shares indirectly through an entity he controls, (iii) Lawrence P. Guiheen, a director of the Company, purchased 20,000 shares of  common stock, (iv) Mr. Grossman purchased 28,571 shares of common stock directly and 57,143 shares indirectly through an entity he controls, (v) Mr. Lenz purchased 7,142 shares of common stock, and (vi) Dr. Mond purchased 4,285 shares of common stock, all at the public offering price of $3.50 per share.