OTHER RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2012

OTHER RELATED PARTY TRANSACTIONS [Abstract]

OTHER RELATED PARTY TRANSACTIONS

NOTE 11. OTHER RELATED PARTY TRANSACTIONS

Compensation of Non-Employee Directors

We compensate our board members with a combination of both stock options and cash payments. During the year ended December 31, 2012, we granted 82,000 stock options to board members having a fair value of approximately $66,000 and we paid $27,000 in cash amounts to our independent directors as consideration for their service on our Board of Directors. We pay $1,000 cash for in person board meetings and $500 cash payments for telephonic board meetings. In addition, the Chairman of our Audit Committee receives a monthly stipend of $1,500, plus a one-time grant of 20,000 stock options. Prior to 2011, we compensated our board members with stock options only.  For the years ended December 31, 2011 and 2010, we granted stock options in the amounts of 15,000 and 54,160 respectively, which had fair values of approximately $20,250 and $53,100, respectively.

Research and Development Consulting Services

A relative of Moshe Citronowicz, Bovie's Senior Vice President, is considered a related party. Arik Zoran, Mr. Citronowicz's brother is the owner of AR Logic, Inc., which is a consulting firm that provides consulting services to the Company. During January 2011, we entered into a three year consulting services agreement with AR Logic that provides for a monthly retainer for engineering support for our existing generator product line and a separate hourly based fee structure for additional consulting related to new product lines. The consulting rates are consistent with rates of an arms length transaction. AR Logic was paid consulting fees of approximately $223,500 and $171,700 during 2012 and 2011, respectively. Previous to 2011, Mr. Zoran was an employee in charge of the engineering department and was paid inclusive of benefits $192,014 for 2010.

A second relative of Mr. Citronowicz is considered a related party. Yechiel Tsitrinovich is also a brother of Mr. Citronowicz, and acts as a consultant to the Company related to research and development of certain products. Mr. Tsitrinovich has a royalty contract with us related to the creation and design of a proprietary technology that is used in some of our generators. Mr. Tsitrinovich was paid a combination of consulting fees and royalties on previous product designs approximating $77,218, $85,310, and $65,654 for the years ended December 31, 2012, 2011, and 2010, respectively.

Professional Services

A former director of Bovie who resigned in March 2012, is president and a shareholder of Ronin Consulting Group, Inc., a company which provides various financial and analytical project consulting services to Bovie. During the time period that Mr. MacLaren was a director for the Company, Ronin Consulting Group, Inc. was paid fees of approximately $20,000, $80,000 and $80,000 during 2012, 2011 and 2010, respectively.

Another former director of Bovie who resigned in March 2012, provides consulting services related to research and development of certain products and was paid fees during the time period that he was acting as a director of approximately $7,500, $30,000, and $30,000 during 2012, 2011, and 2010, respectively.