Line of Credit Agreement (2001)Full Document 

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                            LINE OF CREDIT AGREEMENT

            This LINE OF CREDIT AGREEMENT (the "Agreement") is made as of March
9, 2001 between MILESTONE SCIENTIFIC INC., a Delaware corporation, with its
principal offices at 220 South Orange Avenue, Livingston, New Jersey 07039 (the
"Company"), and K. Tucker Andersen ("Andersen" or the "Lender"), having an
address c/o Cumberland Associates LLC, 1114 Avenue of the Americas, New York,
New York 10036 and Robert Gintel ("Gintel" or the "Lender"), having and address
at 71 Baldwin Farm South, Greenwich, CT 06831 (collectively the "Lenders").

      WHEREAS, the Company desires to borrow from Lenders and Lenders desire to
lend to the Company up to an aggregate of $1,000,000 pursuant to a line of
credit;

      NOW, THEREFORE, in consideration of the premises and the covenants herein
contained, each of the undersigned parties hereto agree as follows:

            1. Line of Credit, Notes and Warrants. Each Lender hereby agrees to
lend to the Company a principal amount of $500,000 ($1,000,000 in the
aggregate), subject to the terms and conditions hereinafter set forth:

            1.1 Andersen shall deliver to the Company, on or before the date of
his execution and delivery of this Agreement, a good bank or certified check
payable to "K. Tucker Andersen" in the sum of $500,000.00 (the "Andersen
Check"), which shall be deposited into a bank account in accordance with
Paragraph 1.3. Gintel shall deliver to the Company, contemporaneously with his
execution and delivery of this Agreement, a good bank or certified check payable
to "Robert Gintel" in the sum of $500,000.00 (the "Gintel Check"), which also
shall be deposited into a bank account in accordance with Paragraph 1.3.

            1.2 Subject to collection of the principal amount from each Lender,
the Company shall deliver the following to each Lender within five (5) business
days of the date hereof:

            (a) A promissory note (the "Note") in the form annexed hereto as
Exhibit A, which Note shall (i) be dated the date hereof, (ii) be for a
principal amount of $500,000.00, and (iii) require interest be payable, at the
Company's option, either in cash upon maturity of the Note (less interest
received on amounts held in the Account), or quarterly in the common stock of
the Company (the "Common Stock"); and

            (b) A warrant (the "Warrant") in the form annexed hereto as Exhibit
B (i) for the purchase of 100,000 shares of Common Stock, (ii) exercisable
commencing on the date hereof up to and including the fifth anniversary of the
date hereof, and (iii) for a per share purchase price equal to the closing price
of a share of Common Stock on the date hereof.

            1.3 The Company, with the Lenders' cooperation, shall open two
separate bank accounts (the "Accounts") at PNC Bank Corp. branch located at 170
Essex St., Millburn, NJ 07041: one in the name of Andersen (the "Andersen
Account") and a second in the name of Gintel (the "Gintel Account"). The Company
shall have the right to designate a signatory

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authorized to withdraw funds from the Accounts on its behalf (the "Signatory").
The Company shall have the right to replace the Signatory at any time and the
Lenders hereby agree to cooperate in promptly effecting such change to the
Accounts. As soon as practicable after payment is received, the Company shall
deposit the Andersen Check into the Andersen Account and the Gintel Check into
the Gintel Account.

            1.4 Upon the deposit of the Andersen Check in accordance with
Paragraph 1.3, the Company shall have the right to withdraw from the Andersen
Account the sum of $312,300. Upon the deposit of the Gintel Check in accordance
with Paragraph 1.3, the Company shall immediately transfer the sum of $156,150
from the Gintel Account to the Andersen Account. Thereafter, the Company shall
have the right to withdraw from each of the Accounts the sum of $450.00 for each

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