Quarterly report pursuant to Section 13 or 15(d)

Note 15 - Commitments

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Note 15 - Commitments
9 Months Ended
Sep. 30, 2018
Notes to Financial Statements  
Commitments and Contingencies Disclosure [Text Block]
NOTE 
15
 — COMMITMENTS 
 
(
1
)  Contract Manufacturing Agreement
 
Milestone Scientific has informal arrangements with
third
-party manufacturers of the STA, CompuDent® and CompuMed® devices, pursuant to which they manufacture these products under specific purchase orders but without any long-term contract or minimum purchase commitment. In
January 2018,
Wand Dental entered into a new purchase commitment for the delivery of
2,000
devices beginning in the
third
quarter of
2018,
Milestone Scientific’s purchase commitment for this purchase order was
$1,152,888
 at
September 30, 2018,
however an advance of
$884,823
was recorded against this purchase order at 
September 30, 2018 
Milestone Scientific still owes
$268,065
related to this purchase order.  An advance of 
$884,823
and
$697,192
was recorded at
September 30, 2018
and
December 31, 2017,
respectively. 
 
 
(
2
)  Other Commitments
 
In
February 2018,
Milestone Scientific and Daniel Goldberger, the Company’s former President and Chief Executive Officer, who resigned effective
October 2, 2017,
signed a Settlement and Release Agreement with respect to Mr. Goldberger’s leaving the Company. The gross settlement was
$175,000,
of which
$147,222
was paid through
September 2018.
The remainder of the settlement will be paid over the next
two
-month period ending in
November 2018.
 
 
The technology underlying the Safety Wand® and
CompuFlo
®, and an improvement to the controls for
CompuDent
® were developed by the Director of Clinical Affairs and assigned to Milestone Scientific. Milestone Scientific purchased this technology pursuant to an agreement dated
January 1, 2005.
The Director of Clinical Affairs will receive additional payments of
2.5%
of the total sales of products using certain of these technologies, and
5%
of the total sales of products using certain other of the technologies until the expiration of the last patent covering these technologies. If products produced by
third
parties use any of these technologies (under license from us) then the Director of Clinical Affairs will receive the corresponding percentage of the consideration received by Milestone Scientific for such sale or license. 
 
The Director of Clinical Affairs’ royalty fee was
$77,907
and
$284,437
for
three
and
nine
months ended
September 30, 2018,
respectively. The Director of Clinical Affairs’ royalty fee was
$122,606
and
$446,098
for
three
and
nine
months ended
September 30, 2017,
respectively. Additionally, Milestone Scientific expensed consulting fees to the Director of Clinical Affairs of
$39,000
and
$146,751
for
three
and
nine
months Ended
September 30, 2018,
respectively, and
$68,751
and
$206,253
for
three
and
nine
months ended
September 30, 2017,
respectively. As of
September 30, 2018,
and
December 31, 2017
Milestone Scientific owes the Director Clinical Affairs for royalties of approximately
$232,000
and
$108,000,
respectively, which is included in accounts payable, related party and accrued expense, related party.
 
In
May 2018,
the Company entered a
twelve
-month Consulting Agreement to provide corporate finance advice, assisting the Company to establish corporate financing goals, and creating public awareness in European markets. The Company shall grant to the Consultant, upon fulfillment of the Condition Precedent (as set forth below), an option to buy from the Company
500,000
shares of newly issued common stock at the price of
$1.00;
such option being exercisable any time up to the
first
anniversary year of the Consulting Agreement.
 
The Condition Precedent is the purchase by the Consultant of at least
400,000
shares of the Company’s common stock from the secondary market within
30
days of signing the Consulting Agreement. If the Consultant purchases up to additional
400,000
shares of the Company’s common stock in the secondary market in the period between
30
to
60
days from the date of the Consulting Agreement, the option will increase up to an additional
500,000
shares of newly issued common stock at a price of
$1.00
per share, the proportion shall be on a
4
to
5
ratio (e.g.,
400,000
shares purchased equals
500,000
shares option). This Consulting Agreement was terminated in
July 2018,
on basis that the consultant did
not
fulfill the condition precedent.