Quarterly report pursuant to Section 13 or 15(d)

Note 11 - Employment and Consulting Agreements

v3.8.0.1
Note 11 - Employment and Consulting Agreements
9 Months Ended
Sep. 30, 2017
Notes to Financial Statements  
Employment and Consulting Agreements [Text Block]
NOTE
11
Employment and Consulting Agreements
 
In
July 2017,
Milestone Scientific entered into a
three
-year employment agreement with Daniel Goldberger to serve as President and Chief Executive Officer of Milestone Scientific. Under the agreement, Mr. Goldberger would receive base compensation of
$300,
000
per annum and
may
additionally earn annual bonuses of up to an aggregate of
$400,000,
payable
one
half in cash and
one
half in Milestone Scientific common stock (“Bonus Shares”) contingent upon achieving performance benchmarks periodically set for each year by the compensation committee of the Board. In addition to any such shares of common stock, Mr. Goldberger was entitled to receive stock options (“Bonus Options”) to acquire twice the number of any Bonus Shares earned, pursuant to a non-qualified stock option grant agreement under Milestone Scientific’s then existing equity compensation plan. The Bonus Options had a
five
-year term and were to vest in equal annual installments on each of the first,
second
and
third
anniversary of the grant date, subject to continued employment on such vesting date and accelerated vesting upon the occurrence of certain events. The exercise price of the Bonus Options was based on the fair market value of per share of common stock on the date of grant.
 
In
July 2017,
Mile
stone Scientific granted to Mr. Goldberger non-qualified stock options to purchase
921,942
shares of common stock at an exercise price of
$2.00
per share. Those options had a
five
-year term and were to vest in equal annual installments on each of the first,
second
and
third
anniversaries of the grant date, subject to his continued employment on the vesting date and accelerated vesting upon the occurrence of certain events.
 
On
October 5, 2017,
Milestone Scientific Inc. announced that Daniel Goldberger had
resigned as President and Chief Executive Officer effective
October 2, 2017,
upon which the previously described stock options granted to him in
July 2017
terminated prior to vesting (see Note
14
).
 
In
July 2017,
Milestone Scientific entered into a
ten
-ye
ar new employment agreement with Leonard Osser, who previously served as the Company’s President and Chief Executive Officer, to serve as Managing Director – China Operations. This new agreement provides for annual compensation of
$300,000
consisting of
$100,000
in cash and
$200,000
in the Company’s common stock valued at the average closing price of the Company’s common stock on the NYSE or such other market or exchange on which its shares are then traded during the
first
fifteen
(
15
) trading days of the last full calendar month of each year during the term of this agreement. This agreement supersedes all prior employment agreements between Mr. Osser and Milestone Scientific. If the Company terminates Mr. Osser’s employment “Without Cause,” other than due to his death or disability, or if Mr. Osser terminates his employment for “Good Reason” (both as defined in the agreement), Mr. Osser is entitled to be paid in
one
lump sum payment as soon as practicable following such termination: an amount equal to the aggregate present value (as determined in accordance with Section
280G
(d)(
4
) of the Code) of all compensation pursuant to this agreement from the effective date of termination hereunder through the remainder of the Employment Term.
 
In
July 2017,
Mr. Osser
also resigned from his positions of Chairman of the Board, Chief Executive Office and President of Milestone Medical. Upon his resignation, Milestone Medical entered in a consulting agreement with U.S. Asian Consulting Group LLC, an entity controlled by Mr. Osser, pursuant to which he will provide specific services to Milestone Medical for a
ten
- year term. Pursuant to the consulting agreement, U.S. Asian Consulting Group, LLC, is entitled to receive
$100,000
per year for Mr. Osser's services.