DEF 14A: Milestone Scientific Announces Annual Meeting of Stockholders Scheduled for July 16, 2024

Milestone Scientific will hold its annual meeting of stockholders virtually on July 16, 2024, to elect directors and ratify the appointment of independent auditors.

Summary

• Milestone Scientific Inc. will hold its Annual Meeting of Stockholders on July 16, 2024, in a virtual-only format.
• The meeting will include the election of seven directors and the ratification of Marcum LLP as the company's independent auditors for the fiscal year ending December 31, 2024.
• Stockholders of record as of May 28, 2024, are entitled to vote at the meeting.
• The proxy statement, proxy card, and the 2023 Annual Report are available online at www.virtualshareholdermeeting.com/MLSS2024.
• The Board of Directors recommends voting for the election of all seven director nominees and for the ratification of the appointment of Marcum LLP as independent auditors.
• The company's Board consists of seven members, with four deemed independent under NYSE American listing standards.
• Key committees of the Board include the Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee, all composed of independent directors.
• The company has supply agreement with United Systems (whose controlling shareholder, Tom Cheng, is a significant stockholder of Milestone Scientific), the principal supplier of its handpieces, pursuant to which it procures manufactured products under specific purchase orders, but without minimum purchase commitments.
• Purchases from this supplier were approximately $2.3 million and $3.4 million for the twelve months ended December 31, 2023, and 2022, respectively.
• As December 31, 2023, and December 31, 2022, Milestone Scientific owed this supplier approximately $402,000 and $819,000, respectively, which is included in accounts payable and accrued expenses related party on the consolidated balance sheets.

Sentiment

Score: 7

Explanation: The document is neutral in tone, primarily focused on procedural matters related to the annual meeting and corporate governance. The inclusion of related party transactions and executive compensation details adds a layer of complexity, but the overall sentiment is stable and routine.

Positives

• The company has a majority of independent directors on its Board.
• The Board has established key committees (Audit, Compensation, Nominating) comprised of independent directors.
• Stock awards to non-executive directors are anticipated to continue in future years as a means to increase alignment of directors with the Company's stockholders.

Negatives

• The company had sales to Milestone China or agents of Milestone China of approximately $270,000 and $630,000 in December 31, 2023 and 2022, respectively, an entity in which the Company formerly had an ownership interest terminating in 2021.

Risks

• The company faces risks including China operation risk, liquidity/capital accessibility risk, medical product acceptance risk, and operational risk.
• The company's stock price is subject to a variety of factors outside of Milestone Scientific's control.

Future Outlook

The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

Management Comments

• The Board believes that the segregation of the roles of Board Chairman and the Chief Executive Officer ensures better overall governance of the Company and provides meaningful checks and balances regarding its overall performance.
• The Company believes that having separate positions provides a clear delineation of responsibilities for each position and fosters greater accountability of management.

Industry Context

This announcement is a routine part of corporate governance, ensuring shareholders have the opportunity to participate in key decisions regarding the company's leadership and financial oversight.

Comparison to Industry Standards

• The director compensation plan, which includes stock awards, aligns with industry practices to incentivize directors and correspond with returns recognized by stockholders.
• The company's approach to executive compensation, including base salary, bonus, and stock options, is similar to that of many companies in the medical device and pharmaceutical industries.

Related Party Transactions

• Milestone Scientific has a supply agreement with United Systems (whose controlling shareholder, Tom Cheng, is a significant stockholder of Milestone Scientific), the principal supplier of its handpieces, pursuant to which it procures manufactured products under specific purchase orders, but without minimum purchase commitments.
• Purchases from this supplier were approximately $2.3 million and $3.4 million for the twelve months ended December 31, 2023, and 2022, respectively.
• As December 31, 2023, and December 31, 2022, Milestone Scientific owed this supplier approximately $402,000 and $819,000, respectively, which is included in accounts payable and accrued expenses related party on the consolidated balance sheets.
• K. Tucker Andersen, a significant stockholder of Milestone Scientific, has an agreement with Milestone Scientific to provide financial and business strategic services.
• Expenses recognized on this agreement were $100,000 for years ended December 31, 2023 and 2022, respectively.
• Marck Haochman, Director of Clinical Affairs royalty fee was approximately $485,000 and $442,000 for the years ended December 31, 2023 and 2022, respectively.
• Additionally, Milestone Scientific expensed consulting fees to the Director of Clinical Affairs of $156,000 and $154,000 for the year ended December 31, 2023 and 2022, respectively.
• As of December 31, 2023, and 2022, Milestone Scientific owed the Director Clinical Affairs for royalties of approximately $114,000 and $120,000, respectively, which is included in accounts payable, related party and accrued expense, related party, in the consolidated balance sheet.

Stakeholder Impact

• Shareholders have the opportunity to vote on key decisions, including the election of directors and the ratification of the independent auditor.
• The Board's decisions and oversight impact the company's financial performance and long-term value for shareholders.
• Executive compensation policies affect the motivation and retention of key management personnel.

Next Steps

• Stockholders are encouraged to vote on the proposals outlined in the proxy statement.
• The company will hold its Annual Meeting of Stockholders on July 16, 2024.
• The Board will consider any other business that properly comes before the Annual Meeting.

Key Dates

Keywords

Annual Meeting, Proxy Statement, Board of Directors, Stockholders, Directors, Auditors, Governance, Compensation, Milestone Scientific