CONFIDENTIAL TREATMENT
CONFIDENTIAL TREATMENT REQUESTED: INFORMATION FOR WHICH CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED IS OMITTED AND IS NOTED WITH
"[CONFIDENTIAL TREATMENT REQUESTED]." AN UNREDACTED VERSION OF
THIS DOCUMENT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.
LICENSE AGREEMENT
This License Agreement (this "Agreement") is entered by and between
SurgiLight, Inc., a Florida corporation ("SurgiLight"), and Biolase
Technology, Inc., a Delaware corporation ("Biolase"), as of February
3, 2005 together referred to as the Parties.
RECITALS
WHEREAS, Biolase desires to obtain a license to certain patents
owned or licensed by SurgiLight in the field of presbyopia and
certain ophthalmology patents on the terms and conditions set forth
herein; and
WHEREAS, SurgiLight desires to grant a license to certain patents
owned or licensed by SurgiLight to Biolase on the terms and conditions
set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants made by each
party herein, and other good and valuable consideration, the receipt
and sufficiency is hereby acknowledged by each party, the parties hereby
agree as follows:
AGREEMENT
For purposes of this Agreement, the following terms shall have their
respective definitions set forth below and the following terms,
conditions, representations and agreements are hereby incorporated
into this Agreement:
"Licensed Patents" shall mean those patents listed in Appendix B.
"Presbyopia Field of Use" shall mean laser treatment of presbyopia,
including any inherent and/or coincident, related procedures and
benefits.
"Ophthalmology Field of Use" shall mean the medical specialty
encompassing the anatomy, functions, pathology and treatment of the eye.
"Ophthalmic Other Patents" shall mean patents owned by or licensed to
Surgilight covering subject matter concerning the use of Er:YAG or
mid-infrared lasers within the Ophthalmology Field of Use but not
within the Presbyopia Field of Use for the treatment of ophthalmic
conditions other than Presbyopia, such as [CONFIDENTIAL TREATMENT
REQUESTED]. Appendix C lists such Ophthalmic Other Patents for the
anterior segment ("Anterior Segment Patents," Appendix C-1) and
refractive ("Refractive Patents, " Appendix C-2).
"Patents" means (i) those patents and patent applications listed on
Appendix A and (ii) those patents licensed to SurgiLight from PLS
Liquidating, LLC, in the Ophthalmology Field of Use (listed in
Appendix B), including any foreign counterparts, or patent
applications claiming priority thereto, including any continuations,
continuations-in-part, or division thereof, or any substitute
applications therefor or equivalent thereof, and any patent issuing
thereon, including any reissue, reexamination or extension thereof
and any confirmation, patent or registration patent or patent of
addition based on such patent. SurgiLight acknowledges that the
Patents contained in Appendices A and B represent all patents as to
which SurgiLight has rights in the Presbyopia Field of Use as of the
date of this Agreement and Appendix A contains all patents owned by
SurgiLight in the Presbyopia Field of Use, except as disclosed in
Appendix F (Schedule of Exceptions).
"Patent License Limitation" means that those patents licensed for the
Ophthalmic Field of Use (i.e. those patents listed in Appendix B)
may only be used by Biolase or its Subsidiaries to practice (i) in
the Presbyopia Field of Use or (ii) in the Ophthalmic Field of Use
to the extent that Biolase does not infringe outside of the
Presbyopia Field of Use any of the SurgiLight's (x) Ophthalmic Other
Patents which are not licensed under this agreement or (y) any
current or future ophthalmic method patents owned or licensed
by SurgiLight not in the Presbyopia Field of Use. If Biolase,
does infringe Ophthalmic Other Patents outside of the Presbyopia
Field of Use (explicitly excluding those patents listed in
Appendix A and B), SurgiLight shall have the right to enforce
the Patents in the Field of Ophthalmology as listed in Appendix B
against Biolase for such infringing conduct in addition to the
infringed Ophthalmic Other Patents.
If SurgiLight, in good faith and with legal standing, determines that
Biolase may be infringing a SurgiLight patent not licensed to Biolase,
it shall notify Biolase of such potential infringement in writing.
The parties agree to negotiate in good faith to resolve this dispute.
Biolase may elect, at its sole discretion, to exercise its option
to license such asserted Surgilight patent or patents on terms
consistent with those of Section 10. Otherwise Biolase and
SurgiLight agree to enter third party binding mediation to resolve
this dispute. The Parties further agree that in the event the mediator
determines infringement, Biolase will exercise its option consistent
with the terms of Section 10, paying SurgiLight the agreed upon
license fees and royalty. For the avoidance of doubt, Surgilight
shall not assert any of it's intellectual property rights against
Biolase or its Subsidiaries for any and all claims with respect to
Surgilight's intellectual property rights for any conduct of Biolase
or its Subsidiaries within the Presbyopia Field of Use. For the
avoidance of doubt, the Parties agree that the mere cutting or
manipulating of ocular tissue does not constitute infringement of
Ophthalmic Other Patents, unless it infringes an Ophthalmic Other
Patent not licensed by this Agreement or any ophthalmic method patent
owned or licensed by SurgiLight.
"Subsidiary" shall mean any entity which directly or indirectly owns
or controls, or is controlled by, or is under common control with
the Party. The term "control" shall mean the direct or indirect
ownership of more than fifty percent (50%) of the outstanding voting
shares of the entity or the right to receive fifty percent (50%) or
more of the profits or earnings of the entity.
1. Licenses. SurgiLight hereby grants to Biolase and
Biolase Subsidiaries:
a. For a period of [CONFIDENTIAL TREATMENT REQUESTED] from
the date of this Agreement (i) a co-exclusive, [CONFIDENTIAL TREATMENT
REQUESTED] license to the Patents set forth in Appendix A in the
Presbyopia Field of Use and (ii) a non-exclusive, [CONFIDENTIAL
TREATMENT REQUESTED] sub-license to the Patents set forth in
Appendix B in the Ophthalmology Field of Use subject to the Patent
License Limitation and the limitations set forth in the definition
thereof; provided that "co-exclusive" as used herein shall mean
exclusive with respect to all third parties other than Surgilight
and its Subsidiaries; further provided, however, that commencing
on the date that is three (3) years after the date of this Agreement,
SurgiLight may sublicense the patents listed in Appendix A to a
third party for the purposes of research and development so long
as such third party cannot commercialize a product until after
five years from the date of this Agreement subject to the terms
set forth below ("Co-Exclusive License"). Surgilight agrees to
request and consider in good faith any objection Biolase may have
as to the entity and nature of such research licensee, including
consideration of any alternative recommended by Biolase, prior to
granting any such research and development sub-license.
b. For a period commencing [CONFIDENTIAL TREATMENT REQUESTED]
from the date of this Agreement and immediately upon the termination of
the Co-Exclusive License and continuing until the last of the patents
listed in Appendices A and B expire, a non-exclusive, worldwide license
to the Patents subject to the terms set forth below ("Non-Exclusive
License").
2. Payments. The Co-Exclusive License and the Non-Exclusive
License (collectively, the "Licenses") are granted in consideration
of payments from Biolase to SurgiLight of Two Million Dollars in the
aggregate as set forth below and the royalty payments set forth in
Section 4 hereof. The following payments (subject to adjustment
as further provided in this Section 2) from Biolase to SurgiLight
are due and payable upon satisfaction of the following conditions:
a. [CONFIDENTIAL TREATMENT REQUESTED], Seventy-Five Thousand
Dollars ($75,000), the receipt and sufficiency of which are hereby
acknowledged.
b. Upon delivery to Biolase of a written agreement [CONFIDENTIAL
TREATMENT REQUESTED]within one week following the date of this Agreement,
One Hundred Seventy-Five Thousand Dollars ($175,000).
c. One month from the date of this Agreement and if the conditions
in Section 2a and b have been satisfied and the Ruling and Opinion
(as defined below) has been obtained indicating that there is no
consolidation requirement under FIN 46R with respect the transactions
contemplated by this Agreement, One Million Five Hundred Fifty Thousand
Dollars ($1,550,000).
d. One Hundred Thousand Dollars ($100,000), to be paid one (1) year
from the date of this Agreement.
e. Twenty-Five Thousand Dollars ($25,000), to be paid on the
anniversary of the execution of this Agreement each of the four (4)
years beginning in 2007, for an aggregate dollar amount of One Hundred
Thousand Dollars ($100,000).
No payments are due under Section 2b or 2c unless and until the
conditions set forth therein are satisfied. SurgiLight shall
exercise commercially reasonable efforts to obtain the agreement
and releases set forth in Section 2b and the ruling from the
Securities Exchange Commission (SEC) referred to below. Biolase
shall exercise commercially reasonable efforts to obtain the opinion
described below from its auditors regarding the proper accounting for
the transactions. In the event that the conditions set forth in Sections
2b and 2c are not satisfied in full by February 28, 2005 then Biolase
shall by written notice to SurgiLight elect to (i) terminate this
Agreement or (ii) waive the delivery of the foregoing agreement,
releases and Ruling and Opinion (to the extent not obtained). In the
event Biolase elects to waive such delivery then any payments set forth
in Section 2b and 2c that remain unpaid shall thereupon become due and
payable and all other payments required pursuant to Section 2 shall be
made on the dates set forth therein. In the event Biolase elects to
terminate this Agreement as above provided then any payments made to
SurgiLight pursuant to this Section 2 shall be retained by Surgilight
and no further payments shall be due to SurgiLight pursuant to this
Agreement. In the event Biolase fails to make the payments under
Section 2.b or 2.c in the time provided therein, then SurgiLight's sole
and exclusive remedy shall be to elect to terminate this Agreement
(provided, that prior to such termination, SurgiLight has given Biolase
written notice of such failure and provided Biolase not less than
fifteen (15) days to cure such failure). Except as provided in
Section 14, nothing in this Agreement shall limit SurgiLight from
defending its Patents against Biolase should this Agreement be
terminated. Upon termination of this Agreement by SurgiLight
pursuant to the preceding sentence, Biolase shall forfeit any
payments already made to SurgiLight. Such termination shall be
SurgiLight's sole remedy in the event of default of any payment
required pursuant to Section 2.b or 2.c. [CONFIDENTIAL TREATMENT
REQUESTED] In the event that Bankruptcy Proceedings are commenced,
SurgiLight agrees to immediately seek a bankruptcy court order,
in form and content reasonably acceptable to Biolase, approving the
assumption of the Agreement (and any other agreement contemplated hereby).
Neither SurgiLight or Biolase shall challenge or assert any claim
against this Agreement or the Licenses granted herein in Bankruptcy
Proceedings (provided, however, Surgilight shall have the right to
assert a claim for payments due pursuant to this Agreement) and Biolase
agrees that it shall not object to a SurgiLight bankruptcy plan that
includes assumption of this Agreement, and not bid to acquire the assets
of SurgiLight in any Bankruptcy Proceedings filed within one year of
the date of this Agreement, unless, Biolase is required to do so to
protect its licensing rights under this Agreement. For avoidance of
doubt, the parties specifically acknowledge that the Right of First
Refusal in Section 9 shall not apply in any Bankruptcy Proceedings
filed within one year of the date of this Agreement.
Notwithstanding any other clause of this Agreement, after the payment
under Section 2.c. has been made, the Licenses shall not be terminated
or cancelled for any reason after the payment under Section 2.c. if
Biolase fails to make any subsequent payment, then Surgilight does have
monetary recourse for the monies due.
Furthermore, SurgiLight has requested a written ruling from the Securities
Exchange Commission (SEC), and Biolase has requested a written opinion
from Biolase's auditors regarding proper accounting for the transactions
contemplated by this Agreement according to FIN 46R (collectively,
the "Ruling and Opinion"). If according to the Ruling and Opinion,
FIN 46R would require Biolase to consolidate SurgiLight's financials,
Biolase and SurgiLight will mutually agree to adjust the payments called
for in Sections 2c, to require Biolase pay the maximum amount payable to
SurgiLight at the earliest date possible which avoids consolidation.
3. Co-exclusive License. The Licenses permit both SurgiLight
and Biolase and their respective Subsidiaries to sell or distribute
through dealers or sell direct to end-users, without requirement for any
additional license to the Patents, any product which is made by, made
for (by a contract manufacturer), used by, designed by, or sold by such
Party or its Subsidiaries. The Co-exclusive License will exclude certain
foreign countries in the jurisdictions listed in Appendix D until the
earlier of the date set forth for such jurisdiction on Appendix D or
the expiration or termination of current exclusive distribution
agreements signed by SurgiLight in such jurisdiction, at which
time such exclusion to Biolase's license rights shall be eliminated
in such countries. For the avoidance of doubt, SurgiLight shall have
the right to continue to license dealers for distribution on a
non-exclusive basis of any product which is made by, made for
(by a contract manufacturer), used by, designed by or sold by
SurgiLight or its Subsidiaries. Both Parties agree that they may
contract with multiple foreign and regional U.S. distributors,
but will contract with no more than one U.S. national distributor,
with respect to products in the Presbyopia Field of Use.
4. Non-exclusive License and Royalty Payments. The Parties
agree that a reasonable minimum royalty rate for the Presbyopia
Field of Use is 5% on worldwide sales. [CONFIDENTIAL TREATMENT
REQUESTED] Biolase and SurgiLight shall maintain complete and
accurate books and records at their respective principal office
during the term of the Licenses and for a period of two (2) years
thereafter. Either party shall have the right to engage an independent
accounting firm to audit at their own expense, and upon reasonable
notice to the other party and no more than once each calendar year,
such records of the other party, related to the amounts due or believed
to be due under this Section 4; provided that, as a condition for such
audit right, each party and its representatives shall agree to maintain
(and to cause its officers, employees, consultants and advisors to
maintain) in confidence all confidential information relating to the
other party disclosed to such person as part of such audit. Each party
shall be responsible for its costs in conducting such audit, unless an
audit reveals an underpayment of 10% or more in any twelve (12) month
period, in which case the audited party shall pay for the costs of
such audit.
5. Confidentiality. This Agreement and its terms shall be
maintained in confidence by each of the parties, except to the extent
that disclosure of this Agreement, or the terms or provisions herein,
is required pursuant to the rules or regulations of the U.S. Securities
and Exchange Commission, or otherwise pursuant to court order or
directive of law or as mutually agreed upon by the parties.
6. Transfer of Technology. SurgiLight has disclosed to
Biolase summaries of its current clinical data with respect to the
Presbyopia Field of Use, including, without limitation, any issues
raised during clinical trials regarding safety or preliminary efficacy
of the technology incorporating the patents listed in Appendix A for
the purpose of furthering the progress of the clinical trials and
protecting patient safety. For a period of thirty days, SurgiLight
will continue to disclose similar data in its possession regarding
safety or preliminary efficacy of the technology incorporating the
patents listed in Appendix A, and respond to any questions from
Biolase or its representatives regarding the data.
7. Use of Patents. Without limiting its rights to the Patents
in any way, Biolase acknowledges and confirms that it intends to
use the Patents for the development of a crystal (Er, Cr: YSGG)
laser system; provided, however, Biolase shall be free to develop
any product within the Presbyopia Field of Use or the Ophthalmology
Field of Use at its own discretion.
8. Patent Prosecution and Defense.
a. Biolase and SurgiLight shall share equally in all
costs associated with the prosecution and maintenance of the Patents;
provided, however, that in the event that SurgiLight elects not to
proceed with the prosecution of any of the Patents, SurgiLight shall
allow Biolase to continue and control prosecution and maintenance of
such patent or patent application at its expense. In such case,
SurgiLight shall continue to own such patent or patent application and
be obligated to pay Biolase its prosecution and maintenance costs.
Biolase would have a lien on that patent until they are repaid.
b. Biolase shall be entitled to participate in the
assertion and defense of the Patents in any infringement or other legal
action (an "Action"); provided, however, (i) that Biolase shall only be
obligated to pay up to twenty-five percent (25%) of such enforcement
costs and (ii) if Biolase does not elect to participate in a significant
enforcement action with respect to a Patent that is material then Biolase
shall forfeit its rights to receive royalties with respect to such
infringing party for its infringement of such Patent. If Biolase
provides notice to SurgiLight that a third party is infringing any
of the Patents in the Presbyopia Field of Use and SurgiLight decides
not to take legal action against such third party, Biolase shall have
the right, at its sole discretion to legally enforce such patent. If
Biolase prevails in such enforcement, it shall be entitled to
seventy-five percent (75%) of any net revenues, including, but not
limited to, damages, license fees and royalties (wherein such
revenues are net of Biolase's enforcement costs). SurgiLight shall
be entitled to the remaining twenty-five percent (25%) of such revenues.
c. [CONFIDENTIAL TREATMENT REQUESTED].
d. The parties acknowledge and agree that either Biolase or
SurgiLight may file new patent applications which are neither a Patent
nor an Ophthalmic Other Patent, and the parties further agree that the
other party shall have no rights in such new patent applications under
this Agreement.
9. First Right of Refusal. Biolase shall have a first right
of refusal with respect to the acquisition of all the Patents or
SurgiLight product line incorporating such Patents for the Presbyopia
Field of Use (collectively, the "SurgiLight Products"). In the event
that SurgiLight receives an offer to purchase the Patents or the
SurgiLight Products and SurgiLight in its sole discretion determines
to accept such offer, SurgiLight will notify Biolase of such offer
and the terms of such offer in writing within five (5) days of
receipt of such offer and determination to accept such offer. Biolase
shall then have thirty (30) days to exercise its right of first refusal
to purchase the Patents and/or SurgiLight Products at the same price
and on the same terms as contained in such offer (the "Offer Terms").
In the event that Biolase elects not to exercise its rights under this
Section 9 to purchase the Patents and/or SurgiLight Products,
SurgiLight may sell the Patents and/or SurgiLight Products to the
offering party on the Offer Terms, subject to the License set forth
herein. In the event the offering party does not purchase the Patents
and/or SurgiLight Products on the Offer Terms then Biolase's rights of
first refusal pursuant to this Section 9 shall continue to apply to the
Patents and SurgiLight Products. The rights of Biolase under this
Section 9 shall apply with respect to each proposed sale of the Patents
and SurgiLight Products to any third party; provided, however, this Right
of Refusal shall not apply in any Bankruptcy Proceedings filed within one
year of the date of this Agreement.
Assumption of Rights. Surgilight agrees and covenants that it will not
sell, transfer or assign to a third party ("Buyer") any of its
intellectual property or property rights in the Patents or Ophthalmic
Other Patents (i) without Biolase's prior written consent or (ii)
without obligating such Buyer to honor all rights of Biolase under this
License Agreement with respect to such intellectual property rights and
securing such Buyer's assumption of all obligations of Surgilight
to Biolase under this Agreement with respect to such intellectual
property rights.
10. Option. Biolase shall have the option, at its sole
discretion to obtain a non-exclusive license to the Anterior Segment
Patents (Appendix C-1) and/or the Refractive Patents (Appendix C-2).
Biolase shall notify SurgiLight in writing that it elects to license such
patents and promptly pay SurgiLight [CONFIDENTIAL TREATMENT REQUESTED],
which license will come into effect upon such payment. Biolase shall
thereafter pay an addition two [CONFIDENTIAL TREATMENT REQUESTED]
royalty for any product, which is sold at least partially for anterior
segment indications covered by a valid claim of an Appendix C-1 Patent
as specifically indicated by literature, advertisements, training
materials and Operator Manuals produced by Biolase or its Subsidiaries
which include anterior segment indications such as [CONFIDENTIAL
TREATMENT REQUESTED] with respect to such product and shall thereafter
pay an additional [CONFIDENTIAL TREATMENT REQUESTED] royalty for any
product, which is sold at least partially for refractive indications
covered by a valid claim of an Appendix C-2 Patent as specifically
indicated in literature, advertisements, training materials and Operator
Manuals produced by Biolase or its Subsidiaries which include refractive
indications such as [CONFIDENTIAL TREATMENT REQUESTED] with respect to
such product. For the avoidance of doubt, published papers and training
materials produced by a party other than Biolase or its Subsidiaries even
if they are using a Biolase product shall not be evidence that Biolase is
advertising or selling for an anterior segment or refractive indication.
[CONFIDENTIAL TREATMENT REQUESTED]. In the event that Biolase exercises
this Option, the Parties shall negotiate in good faith and shall execute
a new, restated license agreement with respect to the license obtained by
Biolase pursuant to this Section 10, which restated license agreement shall
contain the financial terms in this Section 10 and with similar
representations, warranties and covenants to those contained in Sections
9, 11, 12, 13 and 14 of this Agreement. Specifically, SurgiLight shall
represent that the patents licensed shall allow Biolase to practice the
particular method(s) they are licensing without infringing other SurgiLight
patents. For the avoidance of doubt, in the event no new restated license
agreement is executed and Biolase exercises its option, then the terms
herein shall control.
11. Indemnification.
a. Each party shall defend, indemnify and hold the other
party harmless from all claims, demands, liabilities, damages and expenses,
including reasonable attorneys' fees and costs arising out of any breach
of the Agreement by such party.
b. Any party seeking indemnity from the other party under
this Section 11 (an "Indemnified Party") shall notify promptly the party
from whom indemnity is being sought (the "Indemnifying Party") of any
liability or action in respect of which the Indemnified Party intends to
claim such indemnification, and the Indemnifying Party shall have the
right to participate in, and, to the extent the Indemnifying Party so
desires, jointly with any other indemnitor similarly noticed, to assume
the defense thereof with counsel selected by the Indemnifying Party;
provided, however, that the Indemnified Party shall have the right to
retain its own counsel, at its sole expense, if representation of the
Indemnified Party by the counsel retained by the Indemnifying Party
would be inappropriate due to actual or potential differing interests
between the Indemnifying Party and any other party represented by such
counsel in such proceedings. The indemnity agreement in this
Section 11 shall not apply to amounts paid in settlement of any loss,
claim, damage, liability or action if such settlement is effected
without the consent of the Indemnifying Party, which consent shall
not be withheld unreasonably. The failure to deliver notice to the
Indemnifying Party within a reasonable time after the commencement
of any such action, if prejudicial to its ability to defend such
action, shall relieve the Indemnifying Party of any liability to the
Indemnified Party under this Section 11, but the omission of delivery
of such notice to the Indemnifying Party will not relieve it of any
liability that it may have to the Indemnified Party otherwise than under
this Section 11. The Indemnified Party under this Section 11, its
employees and agents, shall cooperate fully with the Indemnifying Party
and its legal representatives in the investigation and defense of any
action, claim or liability covered by this indemnification.
12. Representations, Warranties and Covenants of SurgiLight.
Except as set forth on Appendix F hereto, as of the date hereof,
SurgiLight hereby represents, warrants and covenants as follows:
a. Organization. SurgiLight is a corporation duly organized,
validly existing and in good standing under the laws of the state of
Florida and has all necessary power and authority and all necessary
governmental approvals to own, lease and operate its properties and
to carry on its business as it is now being conducted. SurgiLight is
duly qualified as a foreign corporation to do business, and is in good
standing, in each jurisdiction where the character of its properties
owned or held under license or the nature of its activities makes such
qualification necessary or that would otherwise not have a material
adverse effect on the operations or business of SurgiLight.
b. Authority. SurgiLight has all necessary power and authority
to enter into this Agreement and to carry out its obligations hereunder.
The execution, delivery and performance of this Agreement by SurgiLight
and the consummation by SurgiLight of the transactions contemplated hereby
have been duly authorized by the board of directors of SurgiLight and no
other proceedings on the part of SurgiLight, or its board of directors or
officers, are necessary to authorize this Agreement and the transactions
contemplated hereby. Subject to the foregoing, this Agreement has been
duly and validly executed and delivered by SurgiLight and (assuming this
Agreement constitutes a valid and binding obligation of Biolase)
constitutes a valid and binding agreement of SurgiLight, enforceable
against SurgiLight in accordance with its terms, subject to applicable
bankruptcy, reorganization, insolvency, moratorium and other laws affecting
creditors' rights generally from time to time in effect and to general
equitable principles.
c. Consents and Approvals. No filing with, and no permit,
authorization, consent or approval of, any governmental entity is
necessary for the execution, delivery and performance of this Agreement
by SurgiLight and the consummation by SurgiLight of the transactions
contemplated by this Agreement. No consent or approval of any other
party is required to be obtained by SurgiLight for the execution,
delivery or performance of this Agreement or the performance by SurgiLight
of the transactions contemplated hereby.
d. Litigation. Except as listed in Appendix F, there is no
claim, litigation, suit, action, proceeding or investigation (whether
at law or equity, before or by any federal, state or foreign court,
tribunal, commission, board, agency or instrumentality, or before
any arbitrator) pending or, threatened against SurgiLight or involving
any of the Patents, nor is there any judgment, decree injunction, rule
or order of any court, governmental department, commission, agency,
instrumentality or arbitrator outstanding against SurgiLight or
involving any of the Patents. Without limiting the generality of the
foregoing and subject to Appendix F, no claim or demand of any other
party has been made or, to the best knowledge of SurgiLight, threatened,
that (i) challenges the rights of SurgiLight in respect of any Patent or
(ii) asserts that SurgiLight is infringing or otherwise in conflict with,
or is required to pay any royalty, license fee, charge or other amount
with regard to, any Patent.
e. Non-Contravention. The execution and delivery of this
Agreement (or any other agreement or instrument referred to herein) by
SurgiLight does not, and the performance of its obligations hereunder
(or thereunder) and consummation of the transactions contemplated hereby
(or thereby) will not, (i) conflict with or result in a violation or breach
of any of the terms, conditions or provisions of the certificate of
incorporation or bylaws of SurgiLight; (ii) conflict with or result in a
violation or breach of any term or provision of any law, judgment, ruling,
decree or order applicable to the business or properties of SurgiLight;
or (iii) result in the creation or imposition of any encumbrance upon any
of the assets of SurgiLight pursuant to the terms or provisions of, or
result in a breach or violation of any of the terms or provisions of, or
conflict with or constitute a default under, or give any party a right to
terminate any of its obligations under or result in the acceleration of any
obligation under, any indenture, mortgage, deed of trust, voting trust
agreement, loan agreement, bond, debenture, note agreement or other
evidence of indebtedness, lease, contract or other agreement or instrument
to which SurgiLight is a party or by which SurgiLight or any of its
properties is bound or affected.
f. Intellectual Property Rights.
Except as listed in Appendix F (Schedule of Exceptions), SurgiLight owns
all right, title and interest in and to all of the Patents listed in
Appendix A, subject to the encumbrance listed in Appendix F and SurgiLight
has an exclusive license in the field of ophthalmology to the patents in
Appendix B subject to the exclusions listed in Appendix F. Neither
SurgiLight, nor to the actual knowledge of SurgiLight, any person having
had any interest at any time in any of the Patents, has assigned,
transferred, licensed, pledged or otherwise encumbered any interest
in any of the Patents or agreed to do so (other than (A) for transfers
of rights prior to the date of this Agreement, so long as SurgiLight now
holds all such rights, (B) as contemplated by this Agreement or (C) with
respect to rights outside of the Presbyopia Field of Use in the Licensed
Patents set forth in Appendix A or rights outside of the Ophthalmology
Field of Use in the Licensed Patents set forth in Appendix B). Neither
SurgiLight nor any person with any interest at any time in any of the
Patents has entered into any covenant not to compete or contract or
agreement restricting the right to use or practice any of the Patents
in any market or geographic area or with or without any person.
To the actual knowledge of SurgiLight, (A) SurgiLight is not aware of
any information that would form a reasonable basis for invalidating or
rendering unenforceable any claim in the Patents (assuming in the
instance of any patent applications, for purposes of this
representation, that conforming patents have issued), (B) no statement
or assertion has been made by any third party that any such claim is
invalid or unenforceable and (C) no statement or assertion has been
made by any third party that such third party is aware of any
reasonable basis as to the future invalidity or unenforceability of any
such claim.
There are no defects in the filing or prosecution of the Patents that,
to the actual knowledge of SurgiLight, could cause either (A) the
invalidity, unenforceability or lapse of any Patents (including
any conforming patents that may issue from any patent applications
with respect thereto) or (B) conforming patents not to issue from
such patent applications. Other than with respect to the Licensed
Patents, SurgiLight has received assignment of the entire right,
title and interest in and to the Patents from any and all inventors
with respect thereto and/or any and all predecessors in right without
obligation for the payment of any further consideration whatsoever,
except as noted in Appendix F (Schedule of Exceptions).
Other than with respect to the Licensed Patents, SurgiLight has
received from each current or former officer and each employee of
SurgiLight an agreement providing SurgiLight with title and ownership
of any and all rights pertaining to any and all Patents developed or
held by such individual, by assignment or otherwise, and SurgiLight
owes no obligation to any person or entity with respect to any such
agreement (including, without limitation, any royalty payment obligation).
To the actual knowledge of SurgiLight and except as disclosed in
Appendix F (Schedule of Exceptions), (A) no action has taken place
(whether by the U.S. Patent and Trademark Office (the "USPTO") or any
third party), and no notice of or information with respect to any such
pending or contemplated action has been issued, delivered or made known
to SurgiLight or its counsel, that would affect, in any way, the Patents
or the prospects for the issuance of any conforming patents with respect
thereto in the near-term and (B) no events have occurred or are anticipated
to occur that would cause an unreasonable delay in the issuance of such
conforming patents. All fees and assessments owed as of the date hereof to
the USPTO or any other agency, authority or third party in respect of the
Patents have been paid.
Except as disclosed in Appendix F (Schedule of Exceptions), the
Patents contained in Appendices A and B are all patents as to
which SurgiLight has rights that are in the Presbyopia Field of Use
and the Patents in Appendix A are all the patents owned by SurgiLight
in the Presbyopia Field of Use. The sole remedy to a breach of this
representation and warranty, is that SurgiLight will amend Appendices
A or B as applicable to include such patent.
Except as disclosed in Appendix F (Schedule of Exceptions), the only
liens against the Patents are [CONFIDENTIAL TREATMENT REQUESTED]. The
sole remedy to a breach of this representation and warranty is that
SurgiLight will use its reasonably commercial efforts to obtain a release
of the lien or acknowledgement of Biolase's license in the form of
Appendix E and failing that Biolase may offset any payments agreed
to by SurgiLight necessary to clear the lien from the payments
owed in Section 2.d. and 2.e.
g. Insolvency. As of the date hereof, SurgiLight is not
insolvent under GAAP and will not be rendered insolvent by any of the
transactions contemplated by this Agreement. The amount of the
consideration provided to SurgiLight under this Agreement is not less
than the fair value of, and fair consideration in exchange for, the assets
and rights being assigned or otherwise transferred or licensed to Biolase
under this Agreement. SurgiLight has engaged in the transactions
contemplated by this Agreement on an arms' length basis with Biolase.
For its own part, SurgiLight has conducted such transactions in a manner
intended to obtain not less than the fair value of, and fair consideration
in exchange for, the assets and rights being assigned or otherwise
transferred or licensed to Biolase under this Agreement.
h. Brokers. SurgiLight has not retained any broker in
connection with the transactions contemplated hereby.
i. DISCLAIMER. EXCEPT AS EXPRESSLY STATED IN THIS SECTION 12,
SURGILIGHT (x) MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED,
IN ANY MANNER AND EITHER IN FACT OR BY OPERATION OF LAW, AND (y)
SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, PATENTABILITY OR NONINFRINGEMENT.
13. Representations, Warranties and Covenants of Biolase.
Biolase hereby represents, warrants and covenants as follows:
a. Organization. Biolase is a corporation duly organized,
validly existing and in good standing under the laws of the state
of Delaware and has all necessary power and authority and all
necessary governmental approvals to own, lease and operate its
properties and to carry on its business as it is now being conducted.
Biolase is duly qualified as a foreign corporation to do business,
and is in good standing, in each jurisdiction where the character of
its properties owned or held under license or the nature of its
activities makes such qualification necessary or that would otherwise
not have a material adverse effect on the operations or business of
Biolase.
b. Authority. Biolase has all necessary power and authority
to enter into this Agreement and to carry out its obligations hereunder.
The execution, delivery and performance of this Agreement by Biolase
and the consummation by Biolase of the transactions contemplated hereby
have been duly authorized by the board of directors of Biolase and no
other proceedings on the part of Biolase, or its board of directors
or officers, are necessary to authorize this Agreement and the
transactions contemplated hereby. Subject to the foregoing, this
Agreement has been duly and validly executed and delivered by Biolase
and (assuming this Agreement constitutes a valid and binding obligation
of SurgiLight) constitutes a valid and binding agreement of Biolase,
enforceable against Biolase in accordance with its terms, subject to
applicable bankruptcy, reorganization, insolvency, moratorium and other
laws affecting creditors' rights generally from time to time in effect
and to general equitable principles.
c. Consents and Approvals. No filing with, and no permit,
authorization, consent or approval of, any governmental entity is
necessary for the execution, delivery and performance of this
Agreement by Biolase and the consummation by Biolase of the
transactions contemplated by this Agreement. No consent or
approval of any other party is required to be obtained by Biolase
for the execution, delivery or performance of this Agreement or
the performance by Biolase of the transactions contemplated hereby.
d. Litigation. [CONFIDENTIAL TREATMENT REQUESTED
e. Non-Contravention. The execution and delivery of this
Agreement (or any other agreement or instrument referred to herein)
by Biolase does not, and the performance of its obligations hereunder
(or thereunder) and consummation of the transactions contemplated
hereby (or thereby) will not, (i) conflict with or result in a violation
or breach of any of the terms, conditions or provisions of the
certificate of incorporation or bylaws of Biolase; (ii) conflict
with or result in a violation or breach of any term or provision
of any law, judgment, ruling, decree or order applicable to the
business or properties of Biolase; or (iii) result in the creation
or imposition of any encumbrance upon any of the assets of Biolase
pursuant to the terms or provisions of, or result in a breach or
violation of any of the terms or provisions of, or conflict with
or constitute a default under, or give any party a right to terminate
any of its obligations under or result in the acceleration of any
obligation under, any indenture, mortgage, deed of trust, voting
trust agreement, loan agreement, bond, debenture, note agreement
or other evidence of indebtedness, lease, contract or other agreement
or instrument to which Biolase is a party or by which Biolase or any
of its properties is bound or affected.
f. Insolvency. As of the date hereof, Biolase is not
insolvent and will not be rendered insolvent by any of the transactions
contemplated by this Agreement. In addition, after giving effect to the
consummation of the transactions contemplated by this Agreement, (A)
Biolase will be able to pay its debts as they become due; (B) Biolase
will not have an unreasonably small amount of assets (whether liquid,
tangible or otherwise) as a result of this transaction with which to
conduct its present or proposed business; and (C) taking into account
all (if any) contingent liabilities and pending or threatened
litigation, Biolase will be able to satisfy any such liabilities and
possible judgments against Biolase in actions for money damages that
are reasonably anticipated to be rendered (taking into account the
maximum probable amount of such liabilities as well as judgments in
any such actions as might be rendered) together with all other
obligations of Biolase. The cash available to Biolase as of the
date hereof will be sufficient to pay all of its liabilities and
judgments promptly in accordance with their terms. As used in this
paragraph, (x) "insolvent" means that the sum of the present fair
saleable value of Biolase's assets does not and will not exceed its
debts and other liabilities (including the amount of any contingent
liabilities and possible judgments as contemplated in the immediately
preceding sentence), and (y) "debts" includes any liability, whether
matured or unmatured, liquidated or unliquidated, absolute, fixed or
contingent, disputed or undisputed, or secured or unsecured. Biolase
has not entered into this Agreement with the actual intent to hinder,
delay or defraud any person to which Biolase was, is or may become
indebted. Biolase has engaged in the transactions contemplated by this
Agreement on an arms' length basis with SurgiLight.
g. Brokers. Biolase has not retained any broker in connection
with the transactions contemplated hereby.
h. DISCLAIMER. EXCEPT AS EXPRESSLY STATED IN THIS SECTION 13,
BIOLASE (x) MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED,
IN ANY MANNER AND EITHER IN FACT OR BY OPERATION OF LAW, AND (y)
SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, PATENTABILITY OR NONINFRINGEMENT.
14. Covenant Not to ▇▇▇. Each party hereby agrees not to,
directly or indirectly assert any claim or demand, or commence,
institute or cause to be commenced, any action, suit or proceeding of
any kind against the other party, based upon the known actions,
inactions, operations or business of the other party as conducted
prior to the date hereof. Each party shall not assert against the
other party or its Subsidiaries and hereby releases such party and
its Subsidiaries, from any and all claims under any of it's intellectual
property rights, arising from any conduct of the other Party or its
Subsidiaries on or before the date of this Agreement within the
Presbyopia Field of Use.
The parties hereby acknowledge and represent that they have been
informed by their attorneys of, and are personally familiar with,
Section 1542 of the Civil Code of the State of California, which provides
as follows:
"A general release does not extend to claims which the creditor
does not know or suspect to exist in his favor at the time of executing
the release, which if known by him must have materially affected his
settlement with the debtor."
Each of the parties hereby waives and relinquishes any and all rights
and benefits under Section 1542 of the Civil Code, as presently in
effect and as amended from time to time hereafter, and under any
successor thereto, with respect to the matters released herein.
15. Existence of Other Agreements. This Agreement shall
serve as the entire agreement between the parties with respect to
the subject matter hereof. In addition, SurgiLight hereby
acknowledges and confirms that there are no agreements by and
between SurgiLight and any third party currently in existence which
would adversely affect the terms of the Licenses or the rights of
Biolase hereunder.
16. Assignment. Neither party may assign, transfer,
sublicense or otherwise hypothecate its rights, duties or obligations
under the Licenses, except that either party may sell and assign their
rights and obligations under the Licenses upon the sale of all or
substantially all of its business or upon the sale of their respective
business or product line with respect to the Presbyopia Field of Use
(as applicable). Any other assignment of this Agreement must be made
with the mutual consent of both parties, such consent not to be
unreasonably withheld.
17. Announcement. The parties shall not make any public
announcements regarding this Agreement or the Licenses unless and
until both parties have consented in writing to such announcement. The
parties agree to make a mutual public announcement upon execution of
this Agreement.
18. Binding Nature of Agreement. The parties hereby confirm
their understanding and agreement that the terms hereof are intended
to create a binding contract effective upon execution of this Agreement.
19. Legal Fees. Each party hereby agrees that in the event of
a dispute arising between the parties with respect to this Agreement or
the subject matter hereof, the prevailing party in such dispute shall be
entitled to recover its reasonable costs and expenses, including attorneys'
fees, in connection with such dispute.
20. Governing Law. This Agreement shall be governed by the
laws of the State of California without giving effect to its principles
or rules regarding conflicts of laws, other than such principles directing
application of California law. Each party (i) consents to submit itself
to the personal jurisdiction of any federal court located in the State of
California or any California state court in the event of any dispute of
any kind or nature with respect to or arising out of this Agreement,
(ii) agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from such court,
and (iii) agrees that it will not bring any action with respect to or
arising out of this Agreement in any court other than a federal court
sitting in the State of California or a California state court.
21. Survival. The provisions of Sections 5, 11, 14 through
and including 21 shall survive the termination of this Agreement.
22. Miscellaneous. If any provision of this Agreement is
determined to be invalid or unenforceable for any reason, in whole
or in part, the remaining provisions of this Agreement shall be
unaffected thereby and shall remain in full force and effect to
the fullest extent permitted by applicable law. This Agreement may be
executed in counterparts, all of which together shall constitute
one and the same agreement. All notices hereunder shall be in
writing and shall be deemed to have been duly given when delivered
by messenger (with confirmation of receipt), by facsimile
(upon confirmation of receipt), by email (upon confirmation of
receipt) or five (5) days after being mailed by registered or
certified mail, postage prepaid, as follows:
If to Biolase: Biolase Technology, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
If to SurgiLight: SurgiLight, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
And to:
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
[Signature Page Follows]
IN WITNESS WHEREOF, the parties hereto have executed and mutually
delivered this Agreement as of the date first written above.
Biolase Technology, Inc.,
a Delaware corporation
By:__________________________________
Its:__________________________________
SurgiLight, Inc.,
a Florida corporation
By: _________________________________
Its:__________________________________
APPENDIX A
PATENTS FOR PRESBYOPIA FIELD OF USE
[CONFIDENTIAL TREATMENT REQUESTED]
APPENDIX B
PATENTS FOR OPHTHALMOLOGY FIELD OF USE
(Licensed from PLS Liquidating, LLC)
[CONFIDENTIAL TREATMENT REQUESTED]
APPENDIX C
OTHER OPHTHALMIC PATENTS
APPENDIX C-1
ANTERIOR SEGMENT PATENTS
[CONFIDENTIAL TREATMENT REQUESTED]
APPENDIX C-2
REFRACTIVE PATENTS
[CONFIDENTIAL TREATMENT REQUESTED]
APPENDIX D
COUNTRIES EXCLUDED FROM CO-EXCLUSIVE LICENSE
[CONFIDENTIAL TREATMENT REQUESTED]
Country Distributor Date
APPENDIX E
FORM OF SECURED SURGIlIGHT CREDITORS ACKNOWLEDGMENT OF BIOLASE
CO-EXCLUSIVE LICENSE
LICENSE ACKNOWLEDGMENT AND NON-INTERFERENCE AGREEMENT
[CONFIDENTIAL TREATMENT REQUESTED]
APPENDIX F
SCHEDULE OF EXCEPTIONS
Exceptions to SurgiLight's representations and warranties:
[CONFIDENTIAL TREATMENT REQUESTED]