Commitments and Contingencies | 3 Months Ended |
Jan. 31, 2015 |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. COMMITMENTS AND CONTINGENCIES: |
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Employment Agreements |
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Management voluntarily purchases restricted stock directly from the Company at market price. The respective stock purchases occur on the last trading day of each month. This voluntary election is outlined in each of Daniel J. O’Connor, Chief Executive Officer and President, David J. Mauro, Executive Vice President, Chief Medical Officer, Gregory T. Mayes, Executive Vice President, Chief Operating Officer and Secretary, Robert G. Petit, Executive Vice President, Chief Scientific Officer, and Sara M. Bonstein, Senior Vice President, Chief Financial Officer (each an “Executive”), employment agreements. The table below reflects the purchases of each Executive: |
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| | ANNUALIZED | | | | |
| | Annual Amount | | | For the Three Months Ended January 31, 2015 | |
| | to be Purchased | | | Gross Purchase | | | Net Purchase | |
Executive | | $ | | | $ | | | # of | | | $ | | | # of | |
shares | shares |
Daniel J. O’Connor | | $ | 85,647 | | | $ | 22,294 | | | | 3,777 | | | $ | 22,294 | | | | 3,777 | |
David J. Mauro | | $ | 15,918 | | | $ | 4,256 | | | | 726 | | | $ | 3,290 | | | | 580 | |
Gregory T. Mayes | | $ | 20,951 | | | $ | 5,453 | | | | 924 | | | $ | 4,425 | | | | 773 | |
Robert G. Petit | | $ | 25,145 | | | $ | 6,610 | | | | 1,123 | | | $ | 4,856 | | | | 882 | |
Sara M. Bonstein | | $ | 17.651 | | | $ | 4,617 | | | | 783 | | | $ | 3,632 | | | | 630 | |
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For the three months ended January 31, 2015, the Company recorded stock compensation expense of $46,153 on the statement of operations representing 7,832 shares of its Common Stock (7,053 shares on a net basis after employee payroll taxes). |
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From 2013 to present, in addition to the purchases of Common Stock set forth in the above table, Mr. O’Connor has also purchased an additional 146,616 shares of Common Stock out of his personal funds at the then market price for an aggregate consideration of approximately $588,294. These purchases consisted of the conversion of amounts due to Mr. O’Connor under a promissory note given by Mr. O’Connor to the Company in 2012 of approximately $66,500 for 21,091 shares, 2013 base salary which he elected to receive in Common Stock of approximately $182,919 for 34,752 shares, 2013 and 2014 cash bonus voluntarily requested to receive in equity of approximately $206,125 for 57,990 shares, 2014 voluntary request to purchase stock directly from the Company at market price purchases of $68,750 for 15,950 shares, and purchases of the Company’s Common Stock in the October 2013 and March 2014 public offerings of 13,500 shares for $54,000 and 3,333 shares for $10,000. |
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The Executive’s employment agreements entitle them to a performance-based year-end cash bonus. Mr. O’Connor, Dr. Mauro and Mr. Mayes voluntarily requested to be paid all of their bonus, required to be paid in cash, in the Company’s Common Stock instead of cash. Ms. Bonstein voluntarily requested to be paid 75% of her cash bonus in the Company’s Common Stock instead of cash. Dr. Petit received 100% of his bonus in cash. The total fair value of these equity purchases were $457,125, or 137,275 shares of the Company’s Common Stock (104,461 on a net basis after employee payroll taxes). |
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Stock Awards |
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During the three months ended January 31, 2015, 34,094 shares of Common Stock (27,566 shares on a net basis after employee taxes) were issued to executives and employees related to incentive retention awards, employment inducements and employee excellence awards. Accordingly, $133,699 was charged to stock compensation expense. |
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Furthermore, non-executive employees were entitled to receive a performance-based year-end cash bonus. Several non-executive employees requested to be paid all or a portion of their cash bonus in the Company’s Common Stock instead of cash. The total fair value of these equity purchases were $28,164, or 8,458 shares of the Company’s Common Stock (8,442 on a net basis after employee payroll taxes). |
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The Company recognizes the fair value of those vested shares in the statement of operations in the period earned. |
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Director Compensation |
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During the three months ended January 31, 2015, 191,939 shares of Common Stock (178,513 shares on a net basis after taxes) were issued to the Directors for compensation related to board and committee membership. Accordingly, $606,539 was charged to stock compensation expense. |
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Legal Proceedings |
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Iliad Research and Trading |
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On March 24, 2014, Iliad Research and Trading, L.P. (“Iliad”) filed a complaint (the “Complaint”) against the Company in the Third Judicial District Court of Salt Lake County, Utah, purporting to assert claims for breach of express and implied contract. Specifically, Iliad alleged that the Company granted a participation right to Tonaquint, Inc. (“Tonaquint”) in a securities purchase agreement between Tonaquint and the Company, dated as of December 13, 2012 (the “Purchase Agreement”), pursuant to which Tonaquint was entitled to participate in any transaction that the Company structured in accordance with Section 3(a)(9) or Section 3(a)(10) of the Securities Act of 1933, as amended. Iliad further alleged that the settlement that the Company entered into with Ironridge Global IV, Ltd. (“Ironridge”), pursuant to which the Company issued certain shares of its Common Stock to Ironridge in reliance on the Section 3(a)(10) exemption, occurred without adequate notice for Tonaquint to exercise its participation right. In addition, Iliad alleged that it acquired all of Tonaquint’s rights under the Purchase Agreement in April 2013. |
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On May 9, 2014, the Company filed papers in support of its motion to dismiss the Complaint in its entirety. On June 2, 2014, Iliad filed an amended complaint (the “Amended Complaint”), which purported to add claims against the Company under the federal and Utah securities laws and for common law fraud. On June 30, 2014, the Company removed the action to the United States District Court for the District of Utah. On August 1, 2014, after the Court issued its Order Granting Stipulated Motion for Leave to File Second Amended Complaint, Iliad filed a Second Amended Complaint (the “SAC”), which purported to add a sixth claim for conversion. On August 22, 2014, the Company filed papers in support of its motion to dismiss the SAC in its entirety. On November 24, 2014, the Court filed an order dismissing the conversion claim but denying the remainder of the motion to dismiss. |
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Meanwhile, on September 22, 2014, Iliad filed papers in support of its motion for partial summary judgment of liability on the express contact claim. On December 5, 2014, Advaxis filed papers in opposition to the motion for partial summary judgment and in support of its separate motion under Rule 56(d) to deny partial summary judgment and for allowance of discovery. On December 8, 2014, Advaxis filed its answer to the SAC and a counterclaim (the “Counterclaim”), alleging that Iliad – by purporting to have surreptitiously preserved its claim for breach of Tonaquint’s alleged right to participate in the Ironridge transaction – had fraudulently induced Advaxis to enter into the parties’ post-assignment Exchange and Settlement Agreement and, in the alternative, had breached the covenant of good faith and fair dealing implied therein. On January 23, 2015, Iliad filed (i) reply papers in further support of its motion for partial summary judgment, (ii) papers in opposition to Advaxis’s motion under Rule 56(d) and (iii) its Reply to Counterclaim (rather than attempting to move to dismiss Advaxis’s Counterclaim). On March 11, 2015, the Court held argument on the partial motion for summary judgment and Rule 56(d) motion, and took both motions under advisement, but did not address the parties’ proposed Scheduling Order. |
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Iliad seeks “damages in an amount to be determined at trial” (though the common law fraud damages alone are alleged to be “greater than $300,000”) plus interest, attorneys’ fees and costs. Iliad has also asked for punitive damages in connection with its claims under the Utah Securities Act (equal to three times its actual damages), and common law fraud. The Company intends to continue to defend itself vigorously. |
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Numoda |
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On June 19, 2009, the Company entered into a master agreement and on July 8, 2009, the Company entered into a Project Agreement with Numoda Corporation (“Numoda”), to oversee Phase 2 clinical activity with ADXS-HPV for the treatment of invasive cervical cancer and CIN. |
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Numoda and the Company are in a dispute regarding the amounts outstanding under these agreements. Numoda had taken the position that it was owed approximately $540,000 while the Company believed that the amount due to Numoda should be substantially less than that amount. The Company intends to continue to defend itself vigorously. |
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The Company is from time to time involved in legal proceedings in the ordinary course of its business. The Company does not believe that any of these claims and proceedings against us is likely to have, individually or in the aggregate, a material adverse effect on its financial condition or results of operations. |
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Sale of Net Operating Losses (NOLs) |
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The Company may be eligible, from time to time, to receive cash from the sale of its Net Operating Losses under the State of New Jersey NOL Transfer Program. In December 2014, the Company received a net cash amount of $1,731,317 from the sale of its state NOLs and research and development tax credits for the periods ended October 31, 2012 and 2013. |
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Description of Property |
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The Company’s corporate offices are currently located at 305 College Road East, Princeton, New Jersey 08540. On April 1, 2011, the Company entered into a sublease agreement for such office, which is an approximately 10,000 square foot leased facility in Princeton, NJ. The agreement has a termination date of November 29, 2015. The Company plans to continue to rent necessary offices and laboratories to support its business. |