Note 15 - Commitments |
9 Months Ended |
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Sep. 30, 2018 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] |
NOTE 15 — COMMITMENTS ( 1 ) Contract Manufacturing AgreementMilestone 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. |