Quarterly report pursuant to Section 13 or 15(d)

Note 15 - Commitments

v3.8.0.1
Note 15 - Commitments
3 Months Ended
Mar. 31, 2018
Notes to Financial Statements  
Commitments and Contingencies Disclosure [Text Block]
NOTE 
15
 — COMMITMENTS 
 
(
1
)  Contract Manufacturing Agreement
 
Milestone Scientific has informal arrangements with a
third
-party manufacturer 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 2017,
Milestone Scientific entered into a purchase commitment for the delivery of
2,000
instruments beginning in the
4th
quarter of
2017.
At
March 31, 2018,
Milestone Scientific’s purchase commitment for this purchase order was
$186,965.
In
January 2018
Wand Dental entered into a purchase commitment for the delivery of
2,000
instruments beginning in the
3rd
quarter of
2018,
Milestone Scientific’s purchase commitment for this purchase order was
$1,397,440.
An advance of $
984,408
and
$697,192
was recorded at
March 31, 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,
and 
$80,555
was paid in
March 2018.
The remainder of the settlement will be paid over a
nine
-month period beginning in
March 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. The Director of Clinical Affairs was granted, pursuant to the agreement, an option to purchase, at fair market value on the date of the grant
8,333
shares of common stock upon the issuance of each additional patent relating to 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
$85,769
and
$131,908
for
three
months ended
March 31, 2018
and
2017,
respectively. Additionally, Milestone Scientific expensed consulting fees to the Director of Clinical Affairs of
$68,751
for
three
months ended
March 31, 2018
and
2017,
respectively. 
 
In
January 2017,
Milestone Scientific entered into a
12
-month agreement with Innovest S.p.A. to provide consulting services. This agreement will renew for successive
12
-month terms unless terminated by Innovest S.p.A or Milestone Scientific. Expenses recognized on this agreement were
$20,000
for
three
months ended
March 31, 2018
and
2017.