Item 3. Legal Proceedings
Item 3. Legal Proceedings.
On August 12, 2022, the Company received a demand for arbitration (the “Demand”) from GEM Yield Bahamas Limited and GEM Global Yield LLC SCS (collectively, “GEM”). The Demand claims that the Company’s subsidiary, NeuroRx, Inc. (“NeuroRx"), failed to satisfy its obligation to pay GEM a commitment fee in the amount of HK$ 15,000,000 (approximately US$1,914,087 at current exchange rates) pursuant to a Share Subscription Facility Agreement, executed on October 18, 2019, by and among NeuroRx and GEM (the “Agreement”). NeuroRx expects to vigorously defend its position that payment of the commitment fee is neither due nor owing under the terms of the Agreement.
On November 12, 2022, NRx Pharmaceuticals, Inc. (“NRx” or the “Company”) entered into a Settlement Agreement and Asset Purchase Agreement (“APA”) with Relief Therapeutics Holding AG and Relief Therapeutics International (the “Relief Parties”) to settle the outstanding lawsuit with respect to the Binding Collaboration Agreement dated September 18, 2020 between the Company and the Relief Parties (the “Collaboration Agreement”). The closing under the APA occurred on December 17, 2022 and the parties dismissed their respective claims against each other.
On March 27, 2023, the Company received a copy of a Charge of Discrimination (“Charge”) reportedly filed with the Equal Employment Opportunities Commission and the Texas Workforce Commission Civil Rights Division by Carrier Carretta, the Company’s former Vice President of Clinical Development and Medical Affairs. The Charge includes claims for unlawful discrimination and harassment because of sex, unlawfully retaliated for opposing unlawful discrimination and breach of her employment contract.
The Company intends to work towards a resolution through Ms. Carretta’s attorney, but if a settlement cannot be reached, the Company intends to vigorously defend itself against the claims made by Ms. Carretta. At this time, it is too early to determine the probability of an adverse outcome with respect to such claims or make any reasonable estimate of the quantum of any adverse outcome.
In addition to the matters described above, we may become involved in various legal actions incidental to our business. As of the date of this annual report, we are not involved in any other legal proceedings that we believe could have a material adverse effect on our financial position or results of operations, but regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, and diversion of management resources.
Item 4. Mine Safety Disclosures
Not applicable.
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PART II
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