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Exhibit 10.1
LICENSE AGREEMENT
THIS LICENSE AGREEMENT (together with the attached Exhibits the
"AGREEMENT") is effective as of the 24th day of January, 2007 (the
"EFFECTIVE DATE"), between BIOLASE TECHNOLOGY, Inc. (hereinafter
along with its AFFILIATES, referred to as "BIOLASE"), located at 4
Cromwell, Irvine, California 92618 and The Procter & Gamble Company
(hereinafter along with its AFFILIATES, referred to as "P&G")
located at One Procter & Gamble Plaza, Cincinnati, Ohio 45202. P&G
and BIOLASE may each be referred to as a "PARTY" and collectively as
the "PARTIES".
Whereas, P&G is engaged in the business of developing,
manufacturing, marketing, distributing, selling and supporting a
range of consumer products;
Whereas, BIOLASE is the owner or has certain rights in certain
patents and technology as is more particularly set out in Exhibits A
and B; and further, as is more particularly set out in Exhibit C
(once Exhibit C is populated according to Section 6.2.1.1);
Whereas, P&G and BIOLASE entered into a Letter Agreement (the
"LETTER") dated June 28th, 2006 setting forth the general terms and
conditions for this AGREEMENT;
Whereas, P&G wishes to obtain, and BIOLASE is willing to grant to
P&G, an exclusive license to the BIOLASE IP (as defined in Section
1.2) and BIOLASE TECHNOLOGY (as defined in Section 1.5) according to
the terms and conditions of this AGREEMENT;
Whereas, BIOLASE will retain certain rights to the BIOLASE PATENTS
and BIOLASE TECHNOLOGY according to the terms and conditions of this
AGREEMENT;
Now, therefore, in consideration of the foregoing and other mutual
promises hereinafter set forth and for other good and valuable
consideration, the PARTIES hereto agree as follows:
1. DEFINITIONS
1.1. "AFFILIATE" means any corporation, limited liability company or
other legal entity which directly or indirectly controls, is
controlled by, or is under common control with P&G or BIOLASE,
including any successor or assign of such an entity. "CONTROL", with
respect to an AFFILIATE, shall mean the direct or indirect ownership
of at least fifty percent (50%) of (i) the income, (ii) the
outstanding shares on a fully diluted basis or other voting rights
of the subject entity to elect directors, or if not meeting the
preceding, any entity owned or controlled by or owning or
controlling at the maximum control or ownership right permitted in
the country where such entity exists, or (iii) such other
arrangement as constitutes the direct or indirect ability to direct
the management, affairs or actions of such entity.
1
1.2. "BIOLASE INTELLECTUAL PROPERTY" (BIOLASE IP) means all present and
future: inventions, whether or not patentable; BIOLASE PATENTS;
copyrights; trade secrets; and any other rights or information or
materials within the P&G FIELDS OF USE, whether confidential or not,
owned by BIOLASE or in which BIOLASE has a transferable or
LICENSABLE INTEREST.
1.3. "BIOLASE PATENTS" means those present and future patents and patent
applications within the P&G FIELDS OF USE or within the BIOLASE
TECHNOLOGY or the BIOLASE RETAINED FIELD to the extent permitted
under Section 2.4 of this AGREEMENT, including but not limited to:
i) the patents listed in Exhibits A, B, and C, and any parent
applications, continuations, continuations-in-part, divisionals,
re-exams, reissues thereof, ii) any subsequent patents or patent
applications having applicability in the P&G FIELDS OF USE in which
BIOLASE has ownership or has a transferable or LICENSABLE INTEREST,
and iii) any foreign equivalents of the foregoing
1.4. "BIOLASE RETAINED FIELD" means any and all fields of use and
products which are (a) currently, meaning as of the EFFECTIVE DATE,
marketed by BIOLASE; and (b) other fields of use and products
intended to be used primarily in [* * * * * * * * * * * *
* * * * * * * * * ]. BIOLASE shall also retain all rights to
the BIOLASE IP and BIOLASE TECHNOLOGY that are outside the P&G
FIELDS OF USE. BIOLASE shall also retain and acquire all rights to
products that are declined by P&G or revert to BIOLASE as provided
herein.
The BIOLASE RETAINED FIELD also includes any and all fields of use
which are primarily administered by a [* * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * ]
The BIOLASE RETAINED FIELD also includes products, methods,
applications and services directly or indirectly using [* * * *
* * * * * * * * * * * * * ]: (i) [* * * * ]; (ii) [*
* * * * * ]; (iii) [* * * * * * * * * * * * * ]; (v)
[* * * ]; (vi) [* * ]; (vii) [* * * * ] and (viii) [* * ].
The BIOLASE RETAINED FIELD is applicable to products and methods [*
* * * * * ]. For the avoidance of doubt, products, methods,
applications and services within the PRIMARY P&G FIELD OF USE that
relate to "(ii)", "(iii)", "(iv)", "(v)", "(vi)", and "(vii)" herein
are
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not part of the BIOLASE RETAINED FIELD and are specifically included
in the PRIMARY P&G FIELD OF USE.
For the avoidance of doubt, the BIOLASE RETAINED FIELD includes the
Waterlase, the Waterlase MD, the DioLase Plus, the LaserSmile, the
Oculase, all related consumables, accessories and related products,
methods and all future generations and product line extensions of
the aforementioned products.
The BIOLASE RETAINED FIELD specifically excludes the PRIMARY P&G
FIELD OF USE, as defined below.
1.5. "BIOLASE TECHNOLOGY" means any present or future information or
materials, whether confidential or not, in the possession of
BIOLASE, including know-how, developments, concepts, technical
knowledge, expertise, skill, practice, analytical methodology,
clinical data, manufacturing knowledge, drawings, specifications,
processes, techniques, samples, specimens, prototypes, designs,
research and development results, safety and efficacy data, and
other technical and scientific information reasonably useful or
helpful to P&G for the development and marketing of product(s)
within the P&G FIELDS OF USE.
1.6. "[* * * ] FIELD OF USE" shall mean only those [* * ] products that
are in the form of a [* * ] and which, but for a license from
BIOLASE, would infringe a valid and enforceable claim of the BIOLASE
[* * * ] Patents attached hereto as Exhibit B (such products
hereinafter "[* * * ] PRODUCTS"). For the avoidance of doubt, [* * *
] Products shall not include any [* * ] devices or products that are
not in the form of a [* * ], and specifically shall not include [* *
* * * * * * * * * * ].
1.7. "IMPROVEMENTS" shall mean any and all technology or intellectual
property rights in and to any update, modification, customization,
translation, upgrade, improvement, enhancement and/or derivative
work whether or not developed under a JDA or SERVICES agreement
between the PARTIES.
1.8. "LICENSABLE INTEREST" shall mean any licensable interest, whether or
not royalty-bearing, that exists prior to the EFFECTIVE DATE, or
that is licensed by BIOLASE from any third party after the EFFECTIVE
DATE.
1.9. [* * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * ].
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1.10. "PRODUCT" shall mean any method, system, product, device or machine
(or component thereof), accessory, consumable, composition,
compound, ingredient, application, formulation, material, or
combinations thereof in the P&G FIELDS OF USE, or within the BIOLASE
RETAINED FIELD to the extent permitted under Section 2.4 of this
AGREEMENT, and which, but for the right and license granted herein,
would infringe or cause the inducement of an infringement or
contribute to or induce the infringement of one or more valid and
enforceable claims of one or more BIOLASE PATENTS.
1.10.1. For the avoidance of doubt, any accessory, component,
consumable, or [* * * ] composition that would contribute to
or induce the infringement of one or more valid and
enforceable claims of a BIOLASE PATENT shall be considered a
PRODUCT hereunder. For example, if a valid and enforceable
granted BIOLASE PATENT claim reads upon the [* * * * * *
* * * ] (and no valid and enforceable claims cover [* * *
* * * ], [* * * * * * * ] are PRODUCTS hereunder to
the extent [* * * * * * * * * * * ] induces or
contributes to the infringement of the granted, valid and
enforceable BIOLASE PATENT claim. For example, if a valid and
enforceable granted BIOLASE PATENT claim reads upon the [* *
* * * * * * * * * * ] (and no valid and enforceable
claims read upon the [* * * * * * * * * ]), [* * *
* * * * * * * * * * * * * ].
1.10.2. However, if the valid and enforceable granted BIOLASE PATENT
claim reads upon the [* * * * * * * * * * * * * *
* * * * * * ]. Further, if [* * * * * * * * * *
* * * * ]. For example, if the valid and enforceable
granted BIOLASE PATENT claim reads upon the [* * * * * *
* * * * ] and does not read upon a [* *], then the [* * ]
is not a PRODUCT. Further, if the [* * * * * * * * * ]
and the [* * * ], the [* * ] is still not a PRODUCT.
1.11. "P&G FIELDS OF USE" means, being applicable to [* * * ], any and
all fields of use, including the PRIMARY P&G FIELD OF USE, and
applications relating to or associated with [* * ] product [* * * *
* * * * * * * * * * * * ] including, but not limited to,
those [* * ] product categories listed in attached Exhibit D. The
P&G FIELDS OF USE excludes the BIOLASE RETAINED FIELD. The P&G
FIELDS OF USE also excludes the [* * * * ] FIELD OF USE, unless
P&G exercises its option to add the [* * * ] FIELD OF USE to the
PRIMARY P&G FIELD OF USE.
1.12. "PRIMARY P&G FIELD OF USE" means [* * * ] products intended for
[* * * ] use, [* * * * * * * * * * ],
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including any products which are distributed through [* * * * *]
for use by a [* * * * * * * ]. Such [* * * ] products
include, but are not limited to, any and all products that may
provide one or more of the following benefits, either on a stand-
alone basis or as a combination: [* * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * *
* * * * ], the whole PRIMARY P&G FIELD OF USE [* * * * * *].
The PRIMARY P&G FIELD OF USE specifically excludes the BIOLASE
RETAINED FIELD. The PRIMARY P&G FIELD OF USE also excludes the [* *
* ] FIELD OF USE, unless P&G exercises its option to add the [* *
* ] FIELD OF USE to the PRIMARY P&G FIELD OF USE.
1.13."QUARTER" means any one of the following four (4) time periods within
a calendar year: i) January, February, and March ("JFM"); ii) April,
May, and June ("AMJ"); iii) July, August and September ("JAS"); and
iv) October, November, and December ("OND").
2. LICENSE GRANTS
2.1. LICENSE GRANT TO P&G. BIOLASE hereby grants to P&G an exclusive
(even as to BIOLASE), worldwide, transferable, right and license
under all BIOLASE IP and BIOLASE TECHNOLOGY within the P&G FIELDS OF
USE, with rights to sub-license, to make and have made, use, import,
export, sell, have sold, and offer for sale PRODUCTS anywhere in the
world.
2.2. OPTION TO [* * * * ] FIELD OF USE. P&G has the option to add the
[* * ] FIELD OF USE to the PRIMARY P&G FIELD OF USE for [ * * *
*] after the EFFECTIVE DATE of the AGREEMENT or for [* * * * ]
after the effective date of the LETTER, whichever is sooner, by
either:
i) the payment of a one time sum of [* * * ] ($[* *
* ]); or
ii) providing a written plan regarding [* * * * * ] of a
[* * * ] PRODUCT that is acceptable to BIOLASE, the
acceptability of which shall not be unreasonably
withheld or delayed, together with a notice of P&G's
agreement to pay BIOLASE a) a quarterly sum of [* * * *
* * * ] ($[* * * ]) (each payment a "[* * ]
QUARTERLY PAYMENT"), and b) a royalty rate of [* * *
* * * * * * * ], on [* * * ] PRODUCTS in
accordance with the royalty provision of this AGREEMENT.
The first [* *
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* ] QUARTERLY PAYMENT shall be due at the end of the
QUARTER in which P&G receives written notice from
BIOLASE accepting P&G's written plan for [* * * *
*]. Each successive [* * * ] QUARTERLY PAYMENT shall
be due on the last day of the subject QUARTER. The [* *
* * * ] QUARTERLY PAYMENTS shall cease upon the [* *
* * ] distribution of a [* * * ] PRODUCT in one of
the United States, Canada, or all or a portion of
Eastern or Western Europe. [* * * * * ] of all the
[* * * * * ] QUARTERLY PAYMENTS shall be treated as
prepaid royalties to be deducted from any subsequent
ROYALTY - PAYMENTS owed under this AGREEMENT.
2.2.1.A written plan shall be considered reasonably acceptable, but
reasonable acceptability is not limited to, if the written
plan can be implemented within a commercially reasonable
period time, and it includes the planned commercial launch of
a product in at least one of the United States, Canada, or all
or a portion of Western or Eastern Europe.
2.2.2.In the event that P&G exercises its option to add the [* *
* ] FIELD OF USE to the PRIMARY P&G FIELD OF USE, then the
[* * * * * ] FIELD OF USE shall be treated as if
originally included within the exclusive rights and
obligations from BIOLASE to P&G under this AGREEMENT.
2.2.3.If P&G does not exercise its option to add the [* * * ]
FIELD OF USE to the P&G FIELDS OF USE within the time period
specified, the option will expire, and the [* * * ] FIELD OF
USE will be part of the BIOLASE RETAINED FIELD.
2.3. REVERSION OF CERTAIN RIGHTS TO BIOLASE WITHIN P&G FIELDS OF USE
(EXCLUDING THE PRIMARY P&G FIELD OF USE). Unless otherwise agreed to
between the PARTIES, if, [* * ] has lapsed from the EFFECTIVE DATE
of this AGREEMENT or [* * * * ] has lapsed from the effective
date of the LETTER, whichever is sooner, and P&G has not:
(i) initiated development of; or
(ii) provided a plan to BIOLASE to develop (either itself or
via a licensee or via some other relationship with a
third party)
products utilizing BIOLASE IP or BIOLASE TECHNOLOGY in one or more
of the P&G consumer product categories included within the P&G
FIELDS OF USE (excluding the PRIMARY P&G FIELD OF USE), then BIOLASE
may terminate P&G's exclusive license to BIOLASE IP and BIOLASE
TECHNOLOGY in those particular P&G consumer product categories as
follows: BIOLASE may provide P&G with written notice of its intent
to terminate such exclusive license and if P&G fails to provide
BIOLASE with a plan to initiate development within [* * * ]of such
notice from BIOLASE, P&G's exclusive license in the identified P&G
consumer product category(ies) (excluding the PRIMARY P&G FIELD OF
USE) will be terminated and removed from P&G's FIELDS OF USE.
6
2.3.1.In the event P&G satisfies the requirements of "(i)" or "(ii)"
of this Reversion of Certain Rights Section, P&G will retain
its exclusive rights to said BIOLASE IP and BIOLASE TECHNOLOGY
within said P&G consumer product category for a period [* * *
] beginning upon the satisfaction by P&G of 2.3(i) or 2.3(ii).
However, if after said [* * * ] time period, P&G has not
implemented a [* * * * * ] distribution of a PRODUCT in
said P&G consumer product category, but is actively developing
or attempting to commercialize within said P&G product
category, then P&G, in its sole discretion, may (a) pay
BIOLASE a QUARTERLY sum of [* * * * ] ($[* * * ]) (each
payment a "SECONDARY QUARTERLY PAYMENT") or (b) allow the
BIOLASE IP and BIOLASE TECHNOLOGY to revert to BIOLASE, and
owe nothing further to BIOLASE for the BIOLASE IP and BIOLASE
TECHNOLOGY with respect to such PRODUCT in said P&G consumer
product category. If P&G elects to pay BIOLASE SECONDARY
QUARTERLY PAYMENTS, the first SECONDARY QUARTERLY PAYMENT
shall be due at the end of the QUARTER in which P&G receives
written notice from BIOLASE accepting P&G's written plan for
[* * * * * ]. Each successive SECONDARY QUARTERLY PAYMENT
shall be due on the last day of the subject QUARTER. The
SECONDARY QUARTERLY PAYMENTS shall cease upon the [* * * *]
distribution of a PRODUCT in said product category in one of
the United States, Canada, or all or a portion of Eastern or
Western Europe. [* * * * *] of all the SECONDARY QUARTERLY
PAYMENTS shall be treated as pre-paid royalties that shall be
treated as prepaid royalties [* * * * * * * * * * *
* * * * ]. P&G may terminate the SECONDARY QUARTERLY
PAYMENTS at any time for any reason, in which event exclusive
rights under the BIOLASE IP and BIOLASE TECHNOLOGY relating to
said P&G consumer product category shall revert to BIOLASE.
2.3.2.For the sake of clarity, P&G's exclusive rights in the PRIMARY
P&G FIELD OF USE of use are not subject to reversion to
BIOLASE.
2.3.3.A written plan shall be considered reasonably acceptable to
both PARTIES, but reasonable acceptability is not limited to,
if the written plan is commercially reasonable and can be
implemented within a commercially reasonable time period, and
it includes the planned commercial launch of a product in at
least one of the United States, Canada, or all or a portion of
Western or Eastern Europe.
2.4. POTENTIAL LICENSES TO P&G WITHIN BIOLASE RETAINED FIELD.
2.4.1.For the time period encompassing [* * * ] from the Effective
Date of this AGREEMENT or [* * * ] from the effective date
of the LETTER, whichever time period ends sooner, BIOLASE will
offer P&G the right of first refusal to develop [* * ]
products within the following BIOLASE RETAINED FIELD
categories: (i) [* * * * * * ] (ii) [* * * * * * *
* ]; (iii) [* * * * * * * * * ]; (iv) [* * * * ];
(v) [* * * ]; (vi) [* * * ]; (vii) [* * * * * ]; and
(viii) [* * * * ].
7
2.5. DECISION MAKING. Within (i) the P&G FIELDS OF USE (including the [*
* * ] FIELD OF USE if P&G exercises its option to add the [* * * * *
] FIELD OF USE to the PRIMARY P&G FIELD OF USE), (ii) P&G consumer
product categories in the P&G FIELDS OF USE that have not reverted
back to BIOLASE, and (iii) BIOLASE RETAINED FIELD categories offered
to, and accepted by P&G under Section 2.4.1, P&G shall have the full
and unrestricted right, but not the obligation, to make any and all
decisions, in its sole discretion, surrounding its use of any
BIOLASE TECHNOLOGY and/or BIOLASE IP, including, without limitation,
the development, testing, marketing, manufacture, sourcing,
packaging, sale, distribution, marketing and pricing of any products
whatsoever in the P&G FIELDS OF USE, as well as whether or not to
launch, market, promote, distribute and sell, or continue to sell,
any Product whatsoever. In addition, P&G shall remain free to work
with, contract with, subcontract with, conduct research and
development with, or work for any third party and other third party
researchers, developers, manufacturers, suppliers, etc. regarding
any products or PRODUCTS, subject to all confidentiality obligations
owed to BIOLASE.
2.6. CONVERSION TO NON-EXCLUSIVE LICENSE. Excluding the [* * * * ]
FIELD OF USE, P&G may, in its sole discretion, convert, at any time
after [* * * ] from the EFFECTIVE DATE of this AGREEMENT, its
exclusive license(s) under this AGREEMENT to non-exclusive
license(s), in which case P&G will no longer be obligated to pay the
FIRST or SECOND PRODUCT SHIPMENT PAYMENTS, or QUARTERLY PAYMENTS;
however, P&G will not be entitled to a refund of any payments
previously paid.
2.6.1.In the event the exclusive license is converted to a
non-exclusive license, the royalty rates shall remain as
agreed to herein (at [* * * ]). However, if BIOLASE enters
into a nonexclusive license with a third party at more
favorable terms than that granted to P&G, BIOLASE shall offer
the same terms to P&G, which P&G may accept at its sole
discretion. For example, if BIOLASE grants a third party
rights at a lower royalty rate than that applicable to P&G,
P&G shall be offered the opportunity to convert its royalty
rate to the lower royalty rate granted to such third party,
with such lower rate to take effect upon execution of such
third party agreement.
3. TECHNOLOGY TRANSFER
3.1. LICENSED BIOLASE TECHNOLOGY AND BIOLASE IP RELATED TO THE PRIMARY
P&G FIELD OF USE. Upon reasonable written (including electronically)
request by P&G, BIOLASE shall share or transfer to P&G, relevant
aspects of the BIOLASE TECHNOLOGY and BIOLASE IP licensed to P&G in
the PRIMARY P&G FIELD OF USE, including, the patent applications for
the BIOLASE PATENTS in Exhibits A (and Exhibit B in the event P&G
exercises its option to add the [* * * ] FIELD OF
8
USE to the PRIMARY P&G FIELD OF USE) and related patent prosecution
information, including conception and reduction to practice
information, and will reasonably make available to P&G for
consultation those BIOLASE employees with substantive knowledge
regarding the application of BIOLASE TECHNOLOGY and BIOLASE IP in
the PRIMARY P&G FIELD OF USE; provided, however, that BIOLASE will
not be required to provide more than [* * * * ] of such
consultation time per quarter to P&G and no more than [* * * * *
* * ] in [* * ] consecutive calendar quarters. P&G and BIOLASE
will appoint technical and patent liaisons who will serve as
designated points of contact to develop and coordinate a timely
process that is not overly burdensome for BIOLASE to effectuate said
sharing of BIOLASE TECHNOLOGY and BIOLASE IP in the event P&G
provides BIOLASE with a reasonable written request hereunder.
In the event that such consultation leads P&G to determine that
direct involvement of BIOLASE employees and R&D resources will be
beneficial to the development of products using the BIOLASE
TECHNOLOGY, P&G and BIOLASE may also enter into a joint development
agreement ("JDA"), or other agreement, pursuant to which BIOLASE
shall provide P&G with the specified testing, research, development,
prototyping, production, manufacturing services or other assistance
requested by P&G, to test, develop, produce and manufacture
prototype PRODUCTS and such other products using the BIOLASE
TECHNOLOGY as P&G may request ("SERVICES").
As applicable, the PARTIES will meet at least annually to review
progress on specific development projects within the P&G FIELDS OF
USE.
3.2. LICENSED BIOLASE TECHNOLOGY AND BIOLASE IP IN P&G FIELDS OF USE
(EXCLUDING THE PRIMARY P&G FIELD OF USE). Upon reasonable written
request from P&G, BIOLASE will share the information reasonably
necessary for P&G to determine whether P&G has an interest in
developing and commercializing a BIOLASE TECHNOLOGY or BIOLASE IP
within the P&G FIELDS OF USE (excluding the PRIMARY P&G FIELD OF
USE). Should P&G have an interest in evaluating or commercializing
BIOLASE TECHNOLOGY or BIOLASE IP disclosed under this Section 3.2,
BIOLASE shall disclose information to P&G which is reasonably
related to P&G's interest (including development and manufacturing
information), within a commercially reasonable period of time of
P&G's request to BIOLASE.
4. PAYMENTS
4.1. QUARTERLY PAYMENTS TO BIOLASE UNTIL SHIPMENT OF A FIRST PRODUCT. P&G
shall pay BIOLASE a QUARTERLY sum of [* * * * * * * ] ($[* *
* ]) (each payment a "QUARTERLY PAYMENT"). The first QUARTERLY
PAYMENT shall be due at [* * * * * ] in which the EFFECTIVE DATE
of this AGREEMENT occurs or [* * * * * * ] from the effective
date of the LETTER, whichever is sooner. Each successive QUARTERLY
PAYMENT shall be due on the [* * * * * * * * ] (See Section
4.4.1). QUARTERLY PAYMENTS shall cease upon [*
9
* * ] distribution in the United States of the first Product. [* *
* ] of each QUARTERLY PAYMENT is payment for services provided by
BIOLASE to P&G. [* * * * * ] of each Quarterly Payment shall be
treated as pre-paid royalties [* * * * * * * * * * * *
* ]). Payments made under this Section 4.1 are non-refundable except
as otherwise provided herein.
4.2. MILESTONE PAYMENTS FOR FIRST PRODUCT AND SECOND PRODUCT
4.2.1. FIRST PRODUCT SHIPMENT PAYMENT. P&G shall pay BIOLASE a
product launch milestone payment in the amount of [* * * *]
($[* * * ]) on the terms and subject to the conditions set
forth here below (the "FIRST PRODUCT SHIPMENT PAYMENT").
4.2.1.1. The FIRST PRODUCT SHIPMENT PAYMENT shall be due when
the first PRODUCT covered by one or more valid and
enforceable claims of one or more United States BIOLASE
PATENT(S) is first shipped for [* * * * ]
distribution in the United States.
4.2.1.2. Payments made under this Section 4.2.1 are
non-refundable except as otherwise provided herein. For
the sake of clarity, BIOLASE shall be entitled to only
one FIRST PRODUCT SHIPMENT PAYMENT and under no
circumstance shall there be another FIRST PRODUCT
SHIPMENT PAYMENT.
4.2.2. SECOND PRODUCT SHIPMENT PAYMENT. P&G shall pay BIOLASE a
second product launch milestone payment in the amount of [* *
* * * ] ($[* * * ]) on the terms and subject to the
conditions set forth here below (the "SECOND PRODUCT SHIPMENT
PAYMENT").
4.2.2.1. The SECOND PRODUCT SHIPMENT PAYMENT shall be due when
the second PRODUCT covered by one or more valid and
enforceable claims of one or more United States BIOLASE
PATENT(S) is first shipped for [* * * * * ]
distribution in the United States.
4.2.2.2. The SECOND PRODUCT SHIPMENT PAYMENT shall be treated
as prepaid royalties [* * * * * * * * * * * *
* * * ]. The second PRODUCT shall not include
cosmetic changes or minor improvements (refreshes) which
do not fundamentally change the benefit delivered by the
first PRODUCT. The second PRODUCT is one that is largely
unique and different from the first PRODUCT. For the
avoidance of doubt, some non-limiting examples of a
PRODUCT that does not differ significantly from the
first PRODUCT are PRODUCTS that incorporate only
packaging changes; artwork changes; bonus packs;
marketing promotions; changes to the size, color or
shape of the PRODUCT; the addition or elimination of
minor [* * * ], and combinations thereof. Payments made
under this Section 4.2.2 are non-refundable except as
otherwise provided herein. For the sake of clarity,
BIOLASE shall be entitled to only one SECOND PRODUCT
SHIPMENT
10
PAYMENT and under no circumstance shall there be another
Second PRODUCT SHIPMENT PAYMENT. For the sake of clarity
and to serve as an example, if a first PRODUCT is a [*
* ], the second Product may or may not be a [* * * ].
Further, if a first PRODUCT is a [* * ] and a second
PRODUCT is a [* * * ], the [* * ] will be a second
PRODUCT.
4.2.3. For the sake of clarity, in no circumstance will there be a
third product shipment payment.
4.3. ROYALTY PAYMENTS ON PRODUCT SALES
4.3.1. P&G will make royalty payments (the "ROYALTY PAYMENTS") to
BIOLASE based on the NOS of such PRODUCTS. The ROYALTY PAYMENT
shall be equal to the [* * * * * * * * ]. ROYALTY
PAYMENTS may be reduced by [* * * * * * * * * * *
* ].
4.3.2. The royalty rate shall be [* ] if the PRODUCT is in a [* *
*] product category where [* * * * * * * * * * * ]
(see Exhibit D for a non-exhaustive list). For the avoidance
of doubt, a [* * * * * * * * * * * * * * * * *
* ] shall be considered a product category where [* * * *
* * * * * * ] and shall be only subject to a [* ] royalty
in the event a royalty is applicable. The royalty rate shall
be [* ] if the PRODUCT is in a product category where [* * *
* * * * * * * * ]. [* * * * * * * * * * ] which [* *
* * ] shall not trigger a [* * ] royalty. Further, using [* *
* * * * * * * * * * * * ] shall not trigger a [* *
] royalty. For the avoidance of doubt, [* * * * * * * *
* ], but only [* * * ], then a [* * * * ] or [* * ] that
[* * ] would be considered a product in a category where [*
* * * * * * * * * * *].
4.3.3. The amount of ROYALTY PAYMENTS due shall be calculated on [*
* * ] basis from the date of [* * * * ] of PRODUCT in such
[* * ]. ROYALTY PAYMENTS shall only be due for sales in those
[* * ] where commercial sale of a PRODUCT (as defined in
Section 1.10) is covered by one or more [* * * * * * * ]
claims covering said PRODUCT. ROYALTY PAYMENTS shall be paid
on a QUARTERLY basis and shall be due on the [* * ] of the
subject QUARTER. P&G may elect to combine ROYALTY PAYMENTS
into a single payment mechanism (e.g., a single wire
transfer).
4.3.4. P&G Sublicenses to Third Parties
11
4.3.4.1. P&G Sublicenses Comprising Only BIOLASE PATENTS. To the
extent that P&G would have owed ROYALTY PAYMENTS for a PRODUCT
under this AGREEMENT, sub-licenses (comprising only BIOLASE
PATENTS) from P&G to third parties will bear [* * ] royalty rate
[ * * * * * ]. [ * * * * * * * * * * * * * * *
* * * * * * * * * * *].
4.3.4.2. P&G Sublicenses Comprising BIOLASE PATENTS and P&G
Intellectual Property. In the event P&G enters any agreement with
a third party that includes P&G intellectual property and a grant
under BIOLASE PATENTS as part of that agreement, wherein said
grant to such third party to sell products under BIOLASE PATENTS
and said sale would have been subject to ROYALTY PAYMENTS by P&G
to BIOLASE if P&G were selling such products, P&G and BIOLASE
shall mutually agree to [* * * * * * * * * * * * * *
* * * * * * * * * * * * * * * ], and P&G shall pay
[ * * * ] to BIOLASE. For example, if P&G elected to license a
third party rights under both BIOLASE PATENTS and P&G
intellectual property, and [* * * * *] obligated the third
party to pay P&G an [* *] to maintain such license then BIOLASE
would receive [* * * * * * * * * * * * * * * * *
* *].
4.3.4.2.1. The [* * *] under this Section 4.3.4.2 shall be [*
* * * * * * * * * * * * * * * * * * * *
* * * * * *]. It is foreseeable that BIOLASE, only as
applicable to this Section 4.3.4.2 may receive [* *]
compensation, according to the [* * * * * * * * *
* * * * *], for BIOLASE PATENTS than they otherwise
would have under this Agreement. In no event, however,
shall the [* * *] owed to BIOLASE exceed the equivalent
of a [* * ] ROYALTY PAYMENT, as would otherwise be
applicable under this Agreement.
4.3.5. P&G shall deliver to BIOLASE a written report of all NOS of
PRODUCTS, [* * ] in all countries where royalty payments are due
on Products sold, the applicable royalty rate, the amount of
earned royalty, and the calculation of the ROYALTY PAYMENT due to
Biolase after deduction of the current total amount of payments
hereunder that [* * * * ]. Said royalty report shall be
delivered by P&G within [* * * * *] of the last day of the
Quarter in which they are earned.
4.3.6. P&G shall keep accurate and complete records for Products
marketed pursuant to this AGREEMENT of: (i) its calculation of
NOS for Products (as defined herein); and (ii) all royalties paid
and payable hereunder (hereinafter such
12
reports shall collectively be referred to as "SALES AND ROYALTY
RECORDS"). Such Sales and Royalty Records will be kept with
sufficient detail to enable an independent auditor to verify such
figures and to calculate NOS and total royalties paid and payable
hereunder and shall be retained for the TERM and for at least
[* * * ] subsequent to expiration of the TERM or termination.
4.3.7. All payments due to BIOLASE under this Article shall be made in
U.S. Dollars via wire transfer to an account designated by
BIOLASE. P&G shall notify BIOLASE as indicated below prior to
sending any such wire transfers.
4.3.8. Any SALES AND ROYALTY REPORT(S) and notification of any wire
transfer(s) shall be delivered to: BIOLASE TECHNOLOGY, Inc., 4
Cromwell, Irvine CA 92618, attention Richard Harrison, Chief
Financial Officer and Secretary, or to his designee or successor.
4.3.9. At any time prior to the expiration of [* * *] following the
end of any calendar year, BIOLASE shall have the right to audit
P&G's SALES AND ROYALTY RECORDS RELATIVE to this AGREEMENT, said
auditor being independent, having no past relationship with
BIOLASE. The purpose of such audit shall be to verify the
calculation of gross sales for such year, NOS for such year and
the royalties paid and payable hereunder for such year. BIOLASE
shall provide at least [* * * * *] advance written notice
before each such audit. P&G shall cooperate in such audit by
allowing BIOLASE access (during P&G's normal business hours at
the locations where such SALES AND ROYALTY RECORDS are kept)
solely to P&G's SALES AND ROYALTY RECORDS. Upon request by P&G,
the BIOLASE auditor may be required, as a condition of being
granted access to P&G's SALES AND ROYALTY RECORDS hereunder, to
agree to maintain any information reviewed (including, but not
limited to the Auditor's Reports (defined in Section 4.3.11)
submitted to the PARTIES pursuant to 4.3.11 below) in confidence.
Notwithstanding anything herein to the contrary, BIOLASE may only
cause an audit once in any calendar year and only once with
respect to each calendar year.
4.3.10.At the conclusion of the auditor's audit pursuant to Section
4.3.9 above, the auditor shall submit a written report (herein
"AUDITOR'S REPORT") to the PARTIES setting forth the auditor's
findings with respect to the correct gross sales, NOS and total
royalties paid and payable for the quarter(s) in question. If the
AUDITOR'S REPORT results in findings as to gross sales, NOS or
royalties which are different from those originally reported or
paid by P&G, then the AUDITOR'S REPORT shall include a
reconciliation of the original figures with those found to be
correct by the auditor and the source of such difference(s). The
Auditor's Report and its content shall be treated as confidential
pursuant to Section 11. If there is no challenge to the AUDITOR'S
REPORT within [* * *] after receipt of the report by P&G, and
it shows an underpayment of royalties, then P&G shall pay to
BIOLASE within [* * ] of expiration of the [* * ] challenge
period an amount sufficient to remedy the amount of any under
reporting
13
or underpayment of royalties found by the auditor plus interest
calculated at the then current prime rate from the date such
payment is due. If the AUDITOR'S REPORT shows an overpayment of
royalties, such overpayment shall be creditable against any
future royalties payable in subsequent royalty periods. The cost
and expense of any audit conducted hereunder shall be borne by
BIOLASE unless the AUDITOR'S REPORT finds an error in BIOLASE's
favor of at least [* * * ] of the royalties originally paid by
P&G, in which case P&G shall bear such cost and expense, subject
to the outcome of the audit dispute resolution process specified
in following section.
4.3.11.The PARTIES agree to work together with the auditor in good
faith to resolve any disputes arising out of or relating to the
numbers verified and the results reported in an AUDITOR'S REPORT
in a timely, professional and non-adversarial manner. If the
PARTIES and the auditor cannot so resolve a dispute, then either
Party may submit such dispute for binding arbitration
(hereinafter referred to as "ROYALTY ARBITRATION") to a panel of
three (3) arbitrators. Such Royalty Arbitration shall be
conducted in Cincinnati, Ohio, if brought by BIOLASE and in
Irvine, California if brought by P&G. The arbitrators shall be
selected and the arbitration shall be conducted in accordance
with the Commercial Arbitration Rules of the American Arbitration
Association except that the only issue for arbitration in the
ROYALTY ARBITRATION shall be the accuracy of the reporting and
calculation of the values for gross sales, NOS, and royalties
paid and payable hereunder. The arbitrators shall not have power
to add to, subtract from or modify any of the terms or conditions
of this AGREEMENT. Any award rendered in such arbitration may be
enforced by either PARTY in the courts of the State of New York,
to whose jurisdiction each PARTY hereby irrevocably consents and
submits for such purpose. Each PARTY shall bear its own expense
associated with the ROYALTY ARBITRATION. The losing party shall
bear the cost of the arbitration itself and will also be required
to pay the other party's attorneys' fees associated with the
ROYALTY ARBITRATION. In the event that the outcome of the
arbitration is such that there is not a clear losing party, then
the PARTIES agree to share the costs for the arbitration in a
manner consistent with the decision of the arbitrators.
4.3.12.WITHHOLDING. If a law or regulation of any country in which
PRODUCTS are sold requires withholding of taxes of any type,
levies or other charges with respect to any amounts payable
hereunder to BIOLASE, P&G shall promptly pay such tax, levy or
charge for and on behalf of BIOLASE to the proper governmental
authority, and shall promptly furnish BIOLASE with receipt of
such payment. P&G shall have the right to deduct any such tax,
levy or charge actually paid from payment due BIOLASE or be
promptly reimbursed by BIOLASE if no further payments are due
BIOLASE. P&G agrees to assist BIOLASE in claiming exemption from
such deductions or withholdings under double taxation or similar
agreement or treaty from time to time in force and shall use
reasonable efforts to minimize the amount required to be so
withheld or deducted.
14
4.4. PAYMENT DUE DATES. Except for the payment of first QUARTERLY PAYMENT
due [* * ] the EFFECTIVE DATE of this AGREEMENT (the "INITIAL
QUARTERLY PAYMENT"), any payment, including but not limited to any
QUARTERLY PAYMENT, ROYALTY PAYMENTS, FIRST PRODUCT SHIPMENT PAYMENT,
SECOND PRODUCT SHIPMENT PAYMENT, etc., due under this AGREEMENT shall
be paid within [* *] days of its due date. In the event the payor
does not make the payment in full by the [* * * ] day after the due
date, the payee shall be entitled to interest in the amount of the
then current [* * * * * *] on any unpaid amount, from the [* *]
following the due date until such time as the payor pays the payee
the amount owed.
4.4.1. The INITIAL QUARTERLY PAYMENT shall be paid within [* * * ]
after the EFFECTIVE DATE of this AGREEMENT. For the avoidance of
doubt, if the EFFECTIVE DATE of this AGREEMENT is January 24,
2007, then the INITIAL QUARTERLY PAYMENT shall be paid on or
before [* * * ] and the next QUARTERLY PAYMENT shall be paid on
or before [* * * * ], and still further, the third QUARTERLY
PAYMENT shall be paid on or before [* * * ]. In the event the
payor does not make the INITIAL QUARTERLY PAYMENT in full by the
[* * * ] after execution of this AGREEMENT, the payee shall be
entitled to interest in the amount of the then current prime rate
plus [* * *] on any unpaid amount, from the [* * * *]
following the EFFECTIVE DATE of this AGREEMENT until such time
as the payor pays the payee the amount owed.
4.4.2. Any QUARTERLY PAYMENT that accrues after the beginning of a
QUARTER shall be pro-rated to deduct a portion of the QUARTERLY
PAYMENT associated with the period of time between the beginning
of the QUARTER and the accrual date of the payment within the
QUARTER.
5. INTELLECTUAL PROPERTY OWNERSHIP
5.1. BACKGROUND INTELLECTUAL PROPERTY. All IP developed, conceived or
reduced to practice prior to the EFFECTIVE DATE of this AGREEMENT
shall continue to be owned by the respective PARTY that developed,
conceived or reduced it to practice.
5.2. OWNERSHIP BY P&G. All Improvements made solely by P&G shall be owned
and retained by P&G, including IMPROVEMENTS to BIOLASE TECHNOLOGY
invented or developed solely by P&G. Further, IMPROVEMENTS made solely
by P&G, including patent applications comprising only such
IMPROVEMENTS, are not subject to this AGREEMENT.
5.3. OWNERSHIP BY BIOLASE. BIOLASE shall continue to own BIOLASE TECHNOLOGY
and BIOLASE IP and, except as set forth herein, no other rights or
licenses to the BIOLASE TECHNOLOGY or BIOLASE IP shall be granted to
P&G, and BIOLASE shall own any IMPROVEMENTS to the BIOLASE TECHNOLOGY
that it solely develops, conceives or reduces to practice, provided,
however, that such IMPROVEMENTS shall be licensed to P&G in accordance
with the terms of this AGREEMENT.
15
5.3.1. While P&G has the right to file on BIOLASE IMPROVEMENTS (e.g.,
continuations-in-part under Exhibit A) under Section 6.1 below,
it is understood that BIOLASE shall retain ownership of said
BIOLASE IMPROVEMENTS and said BIOLASE PATENTS.
5.4. JOINT OWNERSHIP. The PARTIES shall jointly own any IP that is jointly
conceived under this AGREEMENT. Any jointly owned IP shall be licensed
to P&G by BIOLASE in accordance with the terms of this AGREEMENT.
5.4.1. Pursuant to Section 3.1 above, the PARTIES may agree to enter
into a JDA or SERVICES agreement. Terms and conditions for a JDA
or SERVICES agreement shall be agreed to at the time P&G and
BIOLASE mutually agree to enter into such an arrangement.
6. PREPARATION AND PROSECUTION OF PATENT APPLICATIONS AND PATENT COSTS
6.1 LICENSED BIOLASE PATENTS OF EXHIBITS A AND B. Upon the Effective
Date of this AGREEMENT and written notification from P&G, P&G
will have the right, but not the obligation, to take control of
the BIOLASE PATENTS listed in Exhibit A (and Exhibit B, if P&G
exercises its option to add the [* * *] FIELD OF USE to the
PRIMARY P&G FIELD OF USE) and patent applications comprising
BIOLASE IMPROVEMENTS in the PRIMARY P&G FIELD OF USE and
P&G/BIOLASE joint IMPROVEMENTS to the BIOLASE TECHNOLOGY in the
PRIMARY P&G FIELD OF USE. P&G's right to take control as
discussed above in this Section 6.1 shall mean to have sole
responsibility and decision making authority for the preparation,
filing (including the filing of continuations,
continuations-in-part, divisionals, reissues, and
reexaminations), prosecution, and maintenance of the BIOLASE
PATENTS listed in Exhibit A (and Exhibit B, if P&G exercises its
option to add the [* * ] FIELD OF USE to the PRIMARY P&G FIELD
OF USE). P&G will pay all costs and expenses associated with said
control in the event and to the extent P&G exercises its right to
take control of one or more BIOLASE PATENTS hereunder. BIOLASE
will cooperate with P&G, including giving P&G power of attorney
and changing the correspondence address to P&G's address.
6.1.1 In the event that P&G takes control of a BIOLASE PATENT and
decides not to prosecute or maintain said BIOLASE PATENT in
any particular country (including the United States),
BIOLASE may take back control of that patent or application
in which event BIOLASE shall be responsible for all costs
and expenses associated with the said BIOLASE PATENT,
including costs and expenses associated with the prosecution
and maintenance of said patent.
6.1.1.1 In the event P&G elects not to prosecute or maintain
a BIOLASE PATENT that P&G has taken control of, P&G
will provide BIOLASE with at least [* *
16
*] advance written notice of such decision. P&G's
written notice will be done in a good faith manner
which reasonably provides BIOLASE with at least [*
* *] to continue with prosecution or maintenance
of that BIOLASE PATENT. In the event that BIOLASE
takes control of a BIOLASE PATENT under Sections
6.1.1 or 6.1.2, such change in control will have
no effect on P&G's payment obligations under
Section 4 and said BIOLASE PATENT shall continue
to be licensed to P&G pursuant to the license
grant of Section 2.
6.1.1.2 P&G will only be responsible for the costs and
expenses incurred from the time of control of a BIOLASE
PATENT is taken by P&G to the sooner of (a) [* * *
*] or (b) the lapse of [* * *] from the time of
notice to BIOLASE that P&G will not continue to
prosecute or maintain particular BIOLASE PATENT(S).
6.1.2 [* * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * *
* * * * * * * * *].BIOLASE will have control and be
responsible for all costs associated with any filings made
by BIOLASE under this Section 6.1.2. Any filings made by
BIOLASE under this Section 6.1.2 shall be subject to the
license granted to P&G under Section 2 of this AGREEMENT.
6.1.3 For the applications or patents which P&G controls or has
taken control of under this AGREEMENT, P&G shall notify
BIOLASE of all written and oral communications to and from
any patent office(s) (including, filings, official actions,
responses to official actions, etc.) in the same manner
outlined by Section 6.2.2.1 and BIOLASE shall have the right
to provide P&G with comments on matters relevant to all
fields outside of the PRIMARY P&G FIELD OF USE and P&G shall
consider in good faith said BIOLASE comment(s) in the same
manner outlined by 6.2.2.
6.1.4 INTERFERENCES, OPPOSITIONS, AND SIMILAR PROCEEDINGS. For
BIOLASE PATENTS controlled by P&G, P&G also may, in its
17
sole discretion, elect to undertake or defend any
interference, reexamination, opposition or similar procedure
with respect to said BIOLASE PATENTS. P&G shall be
responsible for all costs and expenses associated with said
proceedings. If P&G does not elect to undertake or defend
any interference, reexamination, opposition or similar
procedure, BIOLASE may elect to do so at BIOLASE's expense.
6.2 LICENSED BIOLASE PATENTS RELATED TO THE P&G FIELD OF USE.
6.2.1 BIOLASE shall provide to P&G a written update, at least [*
* *], starting from the EFFECTIVE DATE of this AGREEMENT,
of the BIOLASE PATENTS in Exhibits A, Exhibit B (if P&G
exercises its option to add the [* * * *] FIELD OF USE
to the PRIMARY P&G FIELD OF USE), and Exhibit C (if any
consumer product categories in the P&G FIELDS OF USE remain
after [* * ] from the EFFECTIVE of this AGREEMENT or if
P&G accepts any BIOLASE RETAINED FIELD CATEGORIES offered by
BIOLASE)
6.2.1.1 Exhibit C is to be populated by BIOLASE [* * * ]
from the EFFECTIVE DATE of this AGREEMENT so long as at
least one consumer product category in the P&G FIELDS
OF USE remains after [* * *] from the EFFECTIVE of
this AGREEMENT, or so long as P&G accepts at least one
(1) BIOLASE RETAINED FIELD category offered by BIOLASE.
Exhibit C shall remain unpopulated upon execution of
this AGREEMENT.
6.2.2 For all BIOLASE PATENTS in Exhibits A, B, or C under the
control of BIOLASE, P&G shall have the ability to provide
BIOLASE with comments relevant to the P&G FIELD OF USE and
these comments will be considered in good faith by BIOLASE.
P&G comments may include, but are not limited to, claim and
specification amendments, submission of prior art, claim
additions and deletions, and arguments responsive to
official communications from a patent office related
thereto.
6.2.2.1 For BIOLASE PATENTS in Exhibits A, B, or C under the
control of BIOLASE, copies of official written
communications from a patent office shall be provided
to P&G as soon as reasonably possible, but in no event
greater than [* * * *] after receipt by BIOLASE.
Additionally, all papers prepared by BIOLASE for filing
in a patent office shall be provided
18
to P&G within a reasonable period of time to allow for
P&G comment and incorporation thereof by BIOLASE, as
applicable. Each PARTY shall be responsible for its
own attorney's fees and other costs incurred in
reviewing filings and official communications, and
making, reviewing, discussing, and incorporating
comments. Copies of official written communications to
a PATENT office shall be provided to P&G as soon as
reasonably possible, but in no event greater than
[* * *] after submission by BIOLASE
6.2.2.2 In the event that BIOLASE decides not to prosecute
or maintain a BIOLASE PATENT in Exhibits A or B (for
those BIOLASE PATENTS in Exhibits A or B which BIOLASE
maintains or takes control of) or Exhibit C in any
particular country (including the United States), P&G
may take control of that particular application or
PATENT and elect to pay all costs and expenses
associated with control, including prosecution and
maintenance of the BIOLASE PATENTS. BIOLASE shall
provide P&G with at least [* * * ] advanced written
notice of such decision not to prosecute or maintain a
BIOLASE PATENT in Exhibit A. B, or C as applicable.
BIOLASE's written notice will be done in a good faith
manner which provides P&G with at least [* * * ] to
continue with prosecution or maintenance of that
BIOLASE PATENT. P&G may discontinue its prosecution or
maintenance of a BIOLASE PATENT under this Section
6.2.2.2 at any time acting in its sole discretion.
6.2.3 INTERFERENCES, OPPOSITIONS, AND SIMILAR PROCEEDINGS. For BIOLASE
PATENTS of Exhibit A that remain controlled by BIOLASE, BIOLASE
shall notify P&G of all written and oral communications to and
from any patent office(s) concerning any reexamination,
reissuance, interference, opposition or similar proceedings in
the same manner outlined by Section 6.2.2.1 and P&G shall have
the right to comment on matters relevant to the PRIMARY P&G FIELD
OF USE and BIOLASE shall consider in good faith said P&G
comment(s) in the same manner outlined by Section 6.2.2.
19
6.3 COOPERATION. P&G and BIOLASE agree to fully cooperate regarding the
execution of any documents necessary or desirable to prepare,
prosecute, or maintain any patents under Section 6.
7. INFRINGEMENT BY THIRD PARTIES
7.1 NOTIFICATION. Both BIOLASE and P&G agree to notify each other in
writing should either PARTY become aware of a possible infringement of
the BIOLASE PATENTS that relates to the P&G FIELDS OF USE.
7.2. THIRD PARTY INFRINGEMENT IN P&G FIELDS OF USE (EXCLUDING THE P&G
PRIMARY FIELD OF USE).
7.2.1. If P&G provides BIOLASE with evidence of infringement of one of
the BIOLASE PATENTS listed in or to be listed in Exhibit C in the P&G
FIELDS OF USE other than the P&G PRIMARY FIELD OF USE, and if P&G has
initiated development or provided a plan as described above in Section
2.3, then P&G may by written notice request BIOLASE to take steps to
terminate the infringement. If BIOLASE does not, within [* * ] of
receipt of such notice, take appropriate action against the alleged
infringement, then:
7.2.1.1 Upon written notice to BIOLASE, P&G shall have the right,
but not the obligation, as exclusive licensee to institute such
action in its own name as it deems appropriate to terminate said
infringement through negotiation, litigation, and/or alternative
dispute resolution at P&G's expense. As exclusive licensee, P&G
shall have the power at its expense to institute, prosecute and
settle, including by granting the infringing party a sublicense,
suits for infringement of the BIOLASE PATENTS listed in or to be
listed in Exhibit C under this Section 7.2.1.1 after said [* * *
] period, and if required by law, BIOLASE will join as a party
plaintiff in such suits at P&G's expense.
7.2.1.2. P&G shall have the right to select and control counsel
in any action initiated by P&G under Section 7.2.1.1.
7.2.2. Any recovery awarded or received in connection with any
negotiation, settlement or suit under this Section 7.2. in excess of
litigation costs shall belong solely to P&G except as provided under
Section 4.3.4.
20
7.3. THIRD PARTY INFRINGEMENT IN PRIMARY P&G FIELD OF USE.
7.3.1 As exclusive licensee in the PRIMARY P&G FIELD OF USE, P&G shall
have sole decision making authority regarding enforcement of the
BIOLASE PATENTS listed or belonging in Exhibit A (and Exhibit B, if
P&G exercises its option to add the [* * * ] FIELD OF USE to the
PRIMARY P&G FIELD OF USE). P&G shall have the right, but not the
obligation, to file, prosecute and settle any such claims at its sole
discretion. P&G shall retain any proceeds paid by a third party as a
result of the enforcement of the BIOLASE PATENTS within the PRIMARY
P&G FIELD OF USE except as provided under Section 4.3.4. BIOLASE
agrees to cooperate with P&G with the enforcement of any claim within
the PRIMARY P&G FIELDS OF USE and agrees to join, at P&G's expense,
any such action as a party plaintiff to the extent required by law.
7.3.1.1 P&G agrees that it will use reasonable efforts to consult
with BIOLASE prior to the initiation of any action by P&G under
Section 7.3.1. For the avoidance of doubt, said consultation
under this Section 7.3.1.1 shall not impair P&G's right to, in
its sole discretion, institute an action in its own name under
Section 7.3.1 to terminate an infringement in the PRIMARY P&G
FIELD OF USE.
7.3.1.2. P&G shall have the right to control and to select
counsel in any action initiated by P&G under Section 7.3.1.
7.3.1.3 Any recovery awarded or received in connection with any
negotiation, settlement, or suit under this Section 7.3.1 in
excess of litigation costs shall belong solely to P&G except as
provided under Section 4.3.4.
7.4. THIRD PARTY INFRINGEMENT IN BIOLASE RETAINED FIELD. BIOLASE will have
sole control and discretion regarding how to proceed in the event that a
third party is infringing one of the BIOLASE PATENTS in the BIOLASE
RETAINED FIELD and any recovery or settlement awarded or received in
connection with such action shall be solely retained by BIOLASE.
7.5. PROSECUTION OF THIRD PARTY INFRINGEMENT IN OTHER PARTY'S FIELD OF USE.
7.5.1. To the extent that P&G is permitted to exploit a specific
Product application in the BIOLASE RETAINED FIELD pursuant to
Section 2.4 and a third party is infringing one of the BIOLASE
PATENTS in connection with such Product application, such
infringement shall be treated as if it had taken place in P&G
FIELDS OF USE (excluding the PRIMARY P&G FIELD OF USE) in
accordance with Section 7.2.
7.6. DECLARATORY JUDGMENTS.
7.6.1. If a declaratory judgment action alleging invalidity,
unenforceability or non-infringement of any of the BIOLASE
PATENTS
21
is brought against P&G or if a declaratory judgment action alleging
invalidity, unenforceability or non-infringement of any of the
BIOLASE PATENTS is brought against BIOLASE for a BIOLASE PATENT
under which P&G is paying BIOLASE a royalty, P&G may elect, in its
sole discretion, to have sole control of the action, including, but
not limited to, selection and control of counsel and the defense and
settlement of the action, and if P&G so elects it shall bear all the
costs of the action and shall defend against such declaratory
judgment action. P&G shall keep BIOLASE reasonably informed of the
progress of the legal action. P&G may not agree to invalidity,
unenforceability, or non-infringement of a BIOLASE PATENT or any
claim thereof without BIOLASE'S prior written consent, which may be
not be unreasonably withheld.
7.6.2. Except as set forth in Section 7.6.1, if a declaratory
judgment action alleging invalidity, unenforceability or
non-infringement of any of the BIOLASE PATENTS is brought against
BIOLASE, BIOLASE shall have sole control of the action, including,
but not limited to, selection and control of counsel and the defense
and settlement of the action.
7.6.3. Except as set forth in Section 7.6.1, if a declaratory
judgment action alleging invalidity, unenforceability or
non-infringement of any of the BIOLASE PATENTS is brought against
both PARTIES, BIOLASE shall have sole control of the action,
including, but not limited to, selection and control of counsel and
the defense and settlement of the action.
7.7. COOPERATION. Each Party shall fully cooperate with the other PARTY,
at said other PARTY'S expense, in support of any action initiated by said
other PARTY under Section 7, including using commercially reasonable
efforts to have its employees testify when requested and to make available
relevant records, papers, information, samples, specimens, and the like.
8. ALLEGED INFRINGEMENT OF THE PARTIES
8.1. ALLEGED INFRINGEMENT BY P&G IN P&G FIELDS OF USE OR FOR A SPECIFIC
PRODUCT APPLICATION UNDER SECTION 2.4.
8.1.1. If P&G, any of its AFFILIATES or sublicensees, distributors
or other customers are approached by or sued by a third party
concerning an allegation of patent infringement for the development,
manufacture, use, distribution or sale of a product within the P&G
FIELDS OF USE, including the PRIMARY P&G FIELD OF USE, for a product
incorporating BIOLASE TECHNOLOGY, or for a specific product
application under Section 2.4, P&G will promptly, within reason,
notify BIOLASE upon its receiving written notice of such allegation.
P&G shall be entitled to solely control all aspects of the defense
or mitigation of any such allegations, including but not limited to,
selection and control of counsel, negotiation, litigation strategy
development and execution, and settlement.
22
8.1.2. In the event P&G is a party to a legal action pursuant to
Section 8.1.1, BIOLASE shall fully cooperate with and supply all
assistance reasonably requested by P&G, including by using
commercially reasonable efforts to have its employees testify when
requested and to make available relevant records, papers,
information, samples, specimens, and the like. P&G shall bear the
reasonable expenses incurred by BIOLASE in providing assistance and
cooperation as requested by P&G pursuant to this Section 8.1.2.
8.1.3. P&G shall keep BIOLASE reasonably informed of the progress of
the legal action, and BIOLASE shall be entitled to be represented by
counsel in connection with such legal action at its own expense.
8.1.4. P&G shall have the sole right to settle any claims under this
Section 8.1.
8.1.5. In the event P&G settles any claim under Section 8.1.4., P&G
agrees that it will not take any action that would (i) compromise
any of BIOLASE's assets, including but not limited to the BIOLASE
PATENTS, BIOLASE IP, BIOLASE TECHNOLOGY and (ii) obligate BIOLASE to
a third party in any way. For the avoidance of doubt, nothing in
this Section 8.1.5 shall be interpreted to reduce, diminish, or
extinguish any rights granted to P&G under this AGREEMENT.
9. REPRESENTATIONS AND WARRANTIES
9.1. OF BOTH PARTIES. Each PARTY represents and warrants to the other
PARTY that, as of the EFFECTIVE DATE of this AGREEMENT:
9.1.1. The execution, delivery and performance of this AGREEMENT
and the consummation by the warranting PARTY of the
transactions contemplated hereby have been duly authorized by
all necessary corporate action of the warranting PARTY, as
appropriate.
9.1.2. This AGREEMENT has been duly executed and delivered by the
warranting PARTY, and constitutes a valid and legally binding
obligation of the warranting PARTY enforceable against such
PARTY in accordance with its terms, subject to the effect of
any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights and
remedies generally, and subject, as to enforceability, to the
general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at
law).
23
9.1.3. The warranting PARTY has not and will not enter into any
agreement, the terms and conditions of which, would be
inconsistent or in derogation with any of the terms and
conditions hereof.
9.1.4. The warranting PARTY is duly organized and validly existing
under the laws of the jurisdiction of its organization, and
has full power, authority and legal right to execute, deliver
and perform this AGREEMENT, and has taken all necessary action
to authorize the execution, delivery and performance of this
AGREEMENT.
9.1.5. The warranting PARTY is not subject to any judgment, order,
injunction, decree or award of any court, administrative
agency or governmental body that would or might interfere with
its performance of any of its material obligations hereunder.
9.2.OF BIOLASE. BIOLASE hereby covenants, represents, and warrants to P&G, that
to BIOLASE's knowledge:
9.2.1 There are no claims, liens, mortgages, licenses, commitments,
obligations, or encumbrances of any kind concerning the
BIOLASE IP that would affect the ability of BIOLASE to grant
the rights and perform the obligations contemplated by this
AGREEMENT.
9.2.2. Any granted, or allowed claims, of the BIOLASE PATENTS are
valid and enforceable and there are no actions or prior art
that would affect the validity or enforceability of any
granted, or allowed claims, of the BIOLASE PATENTS, including,
but not limited to, any reexamination requests, opposition
proceedings, certificates of correction, or reissuance
requests. BIOLASE's knowledge applies to all agents and
employees of BIOLASE, as well as, agents and attorneys
preparing and prosecuting BIOLASE PATENTS (not including P&G
agents and P&G attorneys).
9.2.3. BIOLASE owns all right, title, and interest in the BIOLASE IP.
9.2.4. BIOLASE has made a reasonable effort to populate Exhibits A,
B, and C (once Exhibit C is populated [* * * ] after the
EFFECTIVE DATE of this AGREEMENT), such that attached Exhibits
A, B, and C (once Exhibit C is populated [* * ] after the
EFFECTIVE DATE of this AGREEMENT) of this AGREEMENT contain a
true and complete list of all of the BIOLASE PATENTS,
including BIOLASE PATENTS that BIOLASE has a LICENSABLE
INTEREST or transferable interest in. It is understood that,
despite a reasonable effort to populate Exhibits A, B, and C
(once Exhibit C is populated [* * ] after the EFFECTIVE DATE
of this AGREEMENT), Exhibits A, B, or C may not be a true and
complete list of all BIOLASE PATENTS. However, upon
realization of any error, correction will be made within a
reasonable period.
24
9.2.5. BIOLASE PATENTS and BIOLASE TECHNOLOGY related thereto, listed
in attached Exhibits A, B, and C (once Exhibit C is populated
[* * *] after the EFFECTIVE DATE of this AGREEMENT) are not
subject to any contractual obligations in the P&G FIELDS OF
USE, including existing or expectant licenses.
9.2.6. As of the EFFECTIVE DATE, BIOLASE does not, directly or
indirectly, make, presently have made, use, import, export,
sell, presently have sold, or offer for sale, anywhere in the
world, a [*** **] or a [* * *], or a [* * * * * * * *
* * *].
9.3. BIOLASE hereby covenants, represents, and warrants to P&G, throughout the
term of this AGREEMENT, BIOLASE will, as far as it is reasonably practicable to
do so, cause its employees who are employed to do research, development, or
other inventive work, to disclose to it inventions within the scope of this
AGREEMENT and to assign to BIOLASE rights in such inventions such that P&G shall
receive, by virtue of this AGREEMENT, the license(s) agreed to be granted to it,
it being understood that if due care and diligence are used, any inadvertent
failure to comply with this Section 9.3 shall not constitute a breach of this
AGREEMENT.
9.4. EXCEPT TO THE EXTENT OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT,
NOTHING CONTAINED IN THIS AGREEMENT WILL BE CONSTRUED AS:
9.4.1 A WARRANTY OR REPRESENTATION BY EITHER PARTY AS TO THE
VALIDITY, ENFORCEABILITY, OR SCOPE OF ANY PATENT;
9.4.2. A WARRANTY OR REPRESENTATION THAT ANY MANUFACTURE, SALE, OFFER
FOR SALE, LEASE, IMPORT, USE OR OTHER DISPOSITION OF ANY
PRODUCTS HEREUNDER WILL BE FREE FROM INFRINGEMENT OF PATENT,
COPYRIGHT OR OTHER INTELLECTUAL PROPERTY RIGHTS OF THIRD
PARTIES;
9.4.3. A WARRANTY OR REPRESENTATION BY EITHER PARTY WITH RESPECT TO
THEIR ENFORCEMENT OF ANY PATENT INCLUDING THE PROSECUTION,
DEFENSE OR CONDUCT OF ANY ACTION OR SUIT CONCERNING
INFRINGEMENT OF ANY SUCH PATENT.
25
9.5. NO OTHER REPRESENTATIONS AND WARRANTIES. Neither Party makes any
representations or warranties other than as expressly set forth in
this Section 9.
10. TERM AND TERMINATION
10.1. TERM. Unless otherwise terminated as provided herein, the AGREEMENT
shall be effective up to and including the date of expiration of the
last to expire BIOLASE PATENT in Exhibits A, B and C.
10.2. TERMINATION
10.2.1. TERMINATION FOR AN UNCURED MATERIAL BREACH. Failure
by either PARTY to comply with any of the material
obligations contained in this AGREEMENT (the
"BREACHING PARTY") shall entitle the other PARTY (the
"NON-BREACHING PARTY") to give to the BREACHING PARTY
notice, pursuant to Section 12.1, specifying the
nature of the breach and requiring it to cure such
breach. In the event the PARTIES are unable to
resolve the matter, the PARTIES may enter an
arbitration, pursuant to Section 12.2. In the event
that the BREACHING PARTY is found, pursuant to
Section 12.2, to have committed a MATERIAL BREACH and
said MATERIAL BREACH BECOMES AN UNCURED MATERIAL
BREACH, the NON-BREACHING PARTY may terminate this
AGREEMENT.
10.2.3. TERMINATION BY MUTUAL CONSENT. This AGREEMENT may be
terminated by mutual written consent of the PARTIES
and rights hereunder divided as the PARTIES agree in
writing.
10.2.4. TERMINATION IN EVENT OF CHANGE IN CONTROL OF BIOLASE.
Pursuant to Section 10.4 below, P&G may terminate
this AGREEMENT in the event of a CHANGE IN CONTROL of
BIOLASE.
10.3. CERTAIN EFFECTS OF TERMINATION.
10.3.1. TERMINATION BY BIOLASE FOR P&G UNCURED MATERIAL
BREACH. Effective upon a termination by BIOLASE in
accordance with Section 10.2.1 above, the following
shall occur:
10.3.1.1. Except for Section 10.3.1.3, P&G's
licenses under the BIOLASE PATENTS and BIOLASE
TECHNOLOGY shall automatically be deemed to have
terminated and all rights thereunder shall
automatically be deemed to have reverted to
BIOLASE;
10.3.1.2. P&G shall destroy all copies of
BIOLASE CONFIDENTIAL INFORMATION provided by
BIOLASE to P&G hereunder. Notwithstanding the
foregoing, and provided
26
P&G fulfills its obligations specified in this
AGREEMENT with respect to such materials, P&G's
counsel may continue to retain solely for
archival purposes a single copy of BIOLASE's
CONFIDENTIAL INFORMATION and any other materials
provided by BIOLASE.
10.3.1.3. P&G shall retain a non-exclusive,
worldwide license to import, offer for sale, or
sell any remaining PRODUCTS that had been
manufactured up to the date of termination of
this AGREEMENT. This non-exclusive license shall
automatically terminate upon [* * * * * * *
* * * * * * ] or [* * * * *] of the
termination of this AGREEMENT, whichever is
sooner. P&G shall owe BIOLASE a royalty under
Section 4.3 for the sales of said PRODUCTS under
this Section 10.3.1.3.
10.3.2. TERMINATION BY P&G FOR UNCURED MATERIAL BREACH BY
BIOLASE. If P&G terminates this AGREEMENT for a MATERIAL BREACH
in accordance with Section 10.2.1 above, BIOLASE, at P&G's
request, shall refund all prior payments received by BIOLASE
from P&G, insofar as they specifically pertain to the UNCURED
MATERIAL BREACH for the term including the [* * ] preceding and
up to the time of the UNCURED MATERIAL BREACH. Said refund shall
include, but is not limited to FIRST or SECOND PRODUCT SHIPMENT
PAYMENT(S), QUARTERLY PAYMENTS, ROYALTY PAYMENTS, and the
PAYMENT made under the LETTER. If P&G elects to receive a refund
of prior payments and the PARTIES are unable to agree on the
amount to be refunded with respect to a UNCURED MATERIAL BREACH,
either PARTY shall submit such dispute to be settled by
arbitration in accordance with Section 12. However, if BIOLASE
commits an UNCURED MATERIAL BREACH, P&G may alternatively elect
to retain its exclusive license(s) without the obligation to pay
FIRST or SECOND PRODUCT SHIPMENT PAYMENT(S), QUARTERLY PAYMENTS,
ROYALTY PAYMENTS, or any other monies whatsoever, however, if
P&G retains its exclusive license(s), it will not be entitled to
a refund of monies previously paid.
10.4. CHANGE IN CONTROL OF BIOLASE . BIOLASE shall promptly
notify P&G of any CHANGE IN CONTROL as the term is defined in
10.4.2, of BIOLASE or a BIOLASE AFFILIATE that is primarily
responsible for undertaking the obligations under this
AGREEMENT. If the CHANGE IN CONTROL event involves a direct
competitor to P&G in the P&G PRIMARY FIELD OF USE, P&G will no
longer have any obligation to share or to disclose information
to BIOLASE regarding the development of products; P&G's ability
to convert to a non-exclusive license pursuant to 2.6 shall no
longer be subject to any time limitation on
27
when such conversion can occur and BIOLASE shall also take all
actions necessary to prevent disclosure of P&G CONFIDENTIAL
INFORMATION to the party involved in the CHANGE IN CONTROL
event, excepting information provided to BIOLASE pursuant to
Section 4.3. Further upon a CHANGE IN CONTROL event involving a
direct competitor to P&G in the P&G PRIMARY FIELD OF USE, P&G
may elect to terminate, modify or continue under this AGREEMENT
as defined in this Section 10.4.
10.4.1. If the CHANGE IN CONTROL event involves a direct
competitor to P&G in the P&G PRIMARY FIELD OF USE, P&G may
elect, without consequence, as provided below:
(i) P&G may elect to terminate any research,
development or manufacturing activity
that BIOLASE may have been conducting
for P&G under this AGREEMENT or a
separate agreement relating to this
AGREEMENT.
(ii) P&G may elect to continue under this
AGREEMENT, including any research,
development or manufacturing activity
that BIOLASE may have been conducting
for P&G under this AGREEMENT or a
separate agreement related to this
AGREEMENT, in which case P&G may request
in writing that BIOLASE or the parent of
the entity acquiring control of BIOLASE
agree to commit in writing, within [* *
* ] after receipt of such request, to
continue to perform the specified
BIOLASE activity, to otherwise agree to
be bound by the provisions of this
AGREEMENT, and to agree to commit in
writing to duly and timely pay, perform
and discharge all of the obligations of
BIOLASE under this AGREEMENT.
(iii) P&G may elect to terminate this
AGREEMENT and a determination pursuant
to Exhibit E will be made of the
PURCHASE PRICE of the BIOLASE PATENTS
licensed to P&G in the PRIMARY P&G FIELD
OF USE under this AGREEMENT, which
patents are listed on Exhibit A (and on
Exhibit B if P&G has exercised its
option to add the [* * * * ] FIELD OF
USE to the PRIMARY P&G FIELD OF USE),
and within [*** * * ] following such
PURCHASE
28
Price determination P&G will make the
further election, in writing, either to
(a) purchase BIOLASE PATENTS, or (b)
rescind its election to purchase BIOLASE
PATENTS. If P&G shall elect to purchase
the BIOLASE PATENTS, the AGREEMENT shall
terminate except for certain surviving
obligations. P&G shall be obligated to
grant back limited rights to BIOLASE
under the acquired BIOLASE PATENTS if
such patents cover products outside the
P&G FIELD OF USE.
10.4.2 CHANGE IN CONTROL. For purposes of this AGREEMENT, a
"CHANGE IN CONTROL" of BIOLASE shall be deemed to have
occurred in the event of (i) a merger, combination,
reorganization or consolidation of BIOLASE with or into
another corporation with respect to which less than a
majority of the outstanding voting power of the
surviving or consolidated corporation is held by
shareholders of BIOLASE immediately prior to such event,
(ii) the sale of all or substantially all of the
properties and assets of BIOLASE and its subsidiaries,
or (iii) the accumulation or acquisition by any
individual, firm, corporation, or entity (other than any
profit sharing or other employee benefit plan of BIOLASE
or any Affiliate, or any employee or group of employees
or former officers an/or directors of BIOLASE or its
Affiliates) of beneficial ownership, directly or
indirectly, of securities of BIOLASE representing more
than fifty percent (50%) of the combined voting power of
BIOLASE's then outstanding voting securities.
10.5 RIGHT OF FIRST NEGOTIATION. If BIOLASE elects to seek a buyer for
any BIOLASE PATENT set out in Exhibit A (and Exhibit B in the event P&G
exercises its option to add the [** * *] FIELD OF USE to the PRIMARY P&G FIELD
OF USE) licensed hereunder to P&G, P&G shall have a [* *] right of first
negotiation with respect to a potential purchase by P&G of such BIOLASE PATENT.
In the event the PARTIES do not enter into a binding agreement with respect to
such purchase within the [* *] period or in the event BIOLASE receives a binding
unsolicited offer, BIOLASE will have sole discretion to pursue offers and sale
to other parties. It is understood that BIOLASE may license, or may have
licensed, other parties in fields outside of fields licensed to P&G under this
AGREEMENT, and that BIOLASE PATENTS may be so encumbered when first offered to
P&G under this Section 10.5.
10.6 TERMINATION NOT SOLE REMEDY. Termination is not the sole remedy under
this AGREEMENT and, whether or not termination is affected, all other
remedies will remain available except as agreed to otherwise herein.
29
10.7. SURVIVAL OF CERTAIN OBLIGATIONS. Section 11 shall survive any
termination, in whole or in part, of this AGREEMENT. The termination
of this AGREEMENT will not relieve either PARTY of any liability it
may have to the other PARTY arising out of or relating to acts or
omissions occurring prior to termination.
11. CONFIDENTIALITY
11.1. During the term of this AGREEMENT, both PARTIES may be exposed to
certain information of the other Party, not generally known to the
public and related to this AGREEMENT, which has been identified by
the DISCLOSING PARTY (the "DISCLOSING PARTY") at the time of
disclosure as being confidential by means of an appropriate marking,
or, if disclosed orally or visually, shall be confirmed in writing
as confidential within [* * * ] of the oral or visual disclosure
(collectively the "CONFIDENTIAL INFORMATION"). The PARTY receiving
the CONFIDENTIAL INFORMATION (the "RECEIVING PARTY") shall keep the
DISCLOSING PARTY's CONFIDENTIAL INFORMATION in confidence for a
period of [* * *] from disclosure, using measures no less protective
than the RECEIVING PARTY takes to protect its own CONFIDENTIAL
INFORMATION of like nature, which in no event will be less than a
reasonable standard of care. The RECEIVING PARTY shall not use, copy
or disclose the CONFIDENTIAL INFORMATION to any third party, nor
permit any of its personnel to use, copy or disclose the
CONFIDENTIAL INFORMATION for any purpose not specifically
contemplated by this AGREEMENT. For the avoidance of doubt, it is
understood by the PARTIES that disclosure of CONFIDENTIAL
INFORMATION by P&G to suppliers, contract manufacturers, testing
organizations or consumer testing, or consultants for the purposes
of market testing, product development or manufacture within the P&G
FIELDS OF USE or for a specific product application under Section
2.4 constitute purposes specifically contemplated by this AGREEMENT.
11.1.1. EXCEPTIONS. The obligations in Section 11.1 shall not
preclude the RECEIVING PARTY from using or disclosing
the same or similar information which may be the same
as the DISCLOSING PARTY's CONFIDENTIAL INFORMATION to
the extent that such same or similar information (i)
was or later becomes, through no act or omission on
the part of the RECEIVING PARTY, generally available
to or available to the public; (ii) was rightfully in
the possession of the RECEIVING PARTY at the time of
disclosure by the DISCLOSING PARTY, as established by
relevant documentary evidence, without restriction as
to use or disclosure; (iii) is hereafter acquired by
the RECEIVING PARTY from a third party who, in
providing such information, does not
30
breach an obligation or confidence of the other PARTY
and provides such information without restriction as
to use or disclosure; or (vi) is independently
conceived, created, or developed by the RECEIVING
PARTY without use of or access to the other PARTY's
CONFIDENTIAL INFORMATION, as established by relevant
documentary evidence. The provisions of Section 11
will not restrict a PARTY from disclosing the other
PARTY's CONFIDENTIAL INFORMATION to the extent
required by any law or regulation; provided that the
PARTY required to make such a disclosure uses
reasonable efforts to give the other PARTY reasonable
advance notice of such required disclosure in order
to enable the other PARTY to prevent or limit such
disclosure.
12. DISPUTE RESOLUTION
12.1. NOTICE AND NEGOTIATION. In the event of any dispute or
disagreement arising out of this AGREEMENT, the PARTIES shall
attempt to resolve the matter by submitting it for resolution
to the President or Chief Executive Officer of BIOLASE and the
appropriate Vice President or General Manager of Research and
Development of P&G. If these representatives are unable to
resolve such dispute to the satisfaction of both BIOLASE and
P&G within [* * * ] after the date on which the dispute was
submitted to such representative(s), the dispute shall be
subject to the process described in Section 12.2 below.
12.2. ARBITRATION. P&G and BIOLASE will attempt to settle any claim,
controversy or deadlock through consultation and negotiation
in good faith and a spirit of mutual cooperation pursuant to
Section 12.1 above. If such attempt fails, the PARTIES agree
to submit to binding arbitration that will be governed by the
rules and procedures of the American Arbitration Association,
with the requirement that the decision being issued by a
written decision and opinion signed by an independent
three-person panel. Such arbitration shall take place in the
State of New York. Judgment upon the award of the arbitrator
may be entered in any court having jurisdiction thereof. In
the event the arbitration involves a claimed material breach
of the AGREEMENT, the alleged breach shall become a MATERIAL
BREACH upon a decision by the arbitration panel that a
MATERIAL BREACH has occurred. A breaching PARTY shall have [*
* *] to cure a MATERIAL BREACH as outlined in the written
decision and opinion of the three-person panel of this Section
12.2. If the MATERIAL BREACH is not cured within [* * *], it
shall become an UNCURED MATERIAL BREACH. If the binding
arbitration involves a patent issue, at least a majority of
the arbiters, in addition to other certifications and/or
qualifications, will be licensed patent attorneys.
12.2.1. Any payment required under the terms of
Sections 12.2 shall be made in USD to the
bank designated by the PARTY to be paid
hereunder.
31
13. INDEMNIFICATION
13.1. BY P&G. From and after the EFFECTIVE DATE of this AGREEMENT,
P&G will indemnify, defend and hold harmless BIOLASE and its
AFFILIATES and their respective directors, officers,
shareholders, partners, attorneys, accountants, and employees
and any agents of the foregoing and any heirs, executors,
successors and assigns of any of the foregoing (the "BIOLASE
INDEMNIFIED PARTIES") from, against and in respect of any
damages, losses, charges, obligations, liabilities, actions,
interest, penalties and reasonable costs and expenses
(including, without limitation, reasonable attorneys' and
experts' fees and expenses incurred to enforce successfully
the terms of this AGREEMENT, "BIOLASE LOSSES AND EXPENSES"))
imposed on, sustained, incurred or suffered by any of the
BIOLASE INDEMNIFIED PARTIES relating to, arising from or
otherwise in respect of (i) any breach of, or inaccuracy in, a
representation or warranty of P&G hereunder, or (ii) a breach
of a covenant or other agreement of P&G hereunder, or (iii)
any action brought by a third party against a BIOLASE
INDEMNIFIED PARTY arising from or related to P&G's
manufacturing, sale, marketing, distribution, or other
exploitation of a product covered by the BIOLASE PATENTS
and/or the BIOLASE TECHNOLOGY; provided, however, that P&G
shall have no obligation to indemnify BIOLASE for any BIOLASE
LOSSES AND EXPENSES for which indemnification is sought if (i)
such BIOLASE LOSSES AND EXPENSES were also caused by, relate
to or involve a breach of, or inaccuracy in, any covenant,
obligation, representation or warranty of BIOLASE provided to
P&G in this AGREEMENT or (ii) such BIOLASE LOSSES AND EXPENSES
result from or arise out of a material action or omission of
BIOLASE.
13.2. BY BIOLASE. From and after the EFFECTIVE DATE of this
AGREEMENT, BIOLASE will indemnify, defend and hold harmless
P&G and its AFFILIATES and licensees and their respective
directors, officers, shareholders, partners, attorneys,
accountants, and employees and any agents of the foregoing and
any heirs, executors, successors and assigns of any of the
foregoing (the "P&G INDEMNIFIED PARTIES") from, against and in
respect of any damages, losses, charges, obligations,
liabilities, actions, interest, penalties and reasonable costs
and expenses (including, without limitation, reasonable
attorneys' and experts' fees and expenses incurred to enforce
successfully the terms of this AGREEMENT, "P&G LOSSES AND
EXPENSES")) imposed on, sustained, incurred or suffered by any
of the P&G INDEMNIFIED PARTIES relating to, arising from or
otherwise in respect of (i) any breach of, or inaccuracy in, a
representation or warranty of BIOLASE hereunder, or (ii) a
breach of a covenant or other agreement of BIOLASE hereunder,
or (iii) any action brought by a third party against a P&G
INDEMNIFIED PARTY arising from or
32
related to BIOLASE's manufacturing, sale, marketing,
distribution, or other exploitation of a product covered by
the BIOLASE PATENTS and/or the BIOLASE TECHNOLOGY; provided,
however, that BIOLASE shall have no obligation to indemnify
P&G for any P&G LOSSES AND EXPENSES for which indemnification
is sought if (i) such P&G LOSSES AND EXPENSES were also caused
by, relate to or involve a breach of, or inaccuracy in, any
covenant, obligation, representation or warranty of P&G
provided to BIOLASE in this AGREEMENT or (ii) such P&G LOSSES
AND EXPENSES result from or arise out of a material action or
omission of P&G.
13.3. THIRD PARTY CLAIMS. The "Indemnified PARTIES" shall mean the
BIOLASE INDEMNIFIED PARTIES and the P&G INDEMNIFIED PARTIES.
If a claim by a third party is made against an INDEMNIFIED
PARTY hereunder, and if such INDEMNIFIED PARTY intends to seek
indemnity with respect thereto under this Section 13, such
INDEMNIFIED PARTY will promptly notify BIOLASE, in the case of
a P&G INDEMNIFIED PARTY, or P&G, in the case of a BIOLASE
INDEMNIFIED PARTY (such PARTY to be notified, the
"INDEMNIFYING PARTY") in writing of such claims setting forth
such claims in reasonable detail, provided that failure of
such INDEMNIFIED PARTY to give prompt notice as provided
herein will not relieve the INDEMNIFYING PARTY of any of its
obligations hereunder, except to the extent that the
INDEMNIFYING PARTY is materially prejudiced by such failure.
The INDEMNIFYING PARTY will have [* * * ] after receipt of
such notice to undertake, through counsel of its own choosing,
subject to the reasonable approval of such INDEMNIFIED PARTY,
and at the INDEMNIFYING PARTY'S expense, the settlement or
defense thereof, and the INDEMNIFIED PARTY will cooperate with
it in connection therewith; provided, however, that the
INDEMNIFIED PARTY may participate in such settlement or
defense through counsel chosen by such INDEMNIFIED PARTY,
provided that the fees and expenses of such counsel will be
borne by such INDEMNIFIED PARTY. If the INDEMNIFYING PARTY
will assume the defense of a claim, it will not settle such
claim without the prior written consent of the INDEMNIFIED
PARTY, (a) unless such settlement includes as an unconditional
term thereof the giving by the claimant of a release of the
INDEMNIFIED PARTY from all liability with respect to such
claim or (b) if such settlement involves the imposition of
equitable remedies or the imposition of any material
obligations on such INDEMNIFIED PARTY other than financial
obligations for which such INDEMNIFIED PARTY will be
indemnified hereunder. If the INDEMNIFYING PARTY will assume
the defense of a claim, the fees of any separate counsel
retained by the INDEMNIFIED PARTY will be borne by such
INDEMNIFIED PARTY unless there exists a conflict between them
as to their respective legal defenses (other than one that is
of a monetary nature), in which case the INDEMNIFIED PARTY
will be entitled to retain separate counsel, the reasonable
fees and expenses of which will be reimbursed by the
INDEMNIFYING PARTY. If the
33
INDEMNIFYING PARTY does not notify the INDEMNIFIED PARTY
within [* * *] after the receipt of the INDEMNIFIED PARTY's
notice of a claim of indemnity hereunder that it elects to
undertake the defense thereof, the INDEMNIFIED PARTY will have
the right to contest, settle or compromise the claim but will
not thereby waive any right to indemnity therefore pursuant to
this AGREEMENT. The indemnification provisions set forth in
this Section 13 are the sole and exclusive means of recovery
of money damages with respect to the matters covered herein,
except for fraud.
13.4. LIMITATION ON LOSSES AND EXPENSES. Notwithstanding
anything to the contrary contained herein, no INDEMNIFYING
PARTY hereunder shall be liable (including liability for
negligence or other tortious act or omission) for (a) any loss
of profit, loss of contract or loss of goodwill incurred by
any INDEMNIFIED PARTY; or (b) any punitive, indirect or
consequential damages incurred by any INDEMNIFIED PARTY
pursuant to this AGREEMENT (it being understood that any
damages described in this Section 13.4 owed by any INDEMNIFIED
PARTY to any third party will be considered direct damages,
not subject to this Section 13.4).
14. MISCELLANEOUS
14.1. CERTAIN INJUNCTIVE RELIEF. Due to the important
confidentiality concerns of the PARTIES, and for other
reasons, the PARTIES will be irreparably damaged in the event
that the provisions of Section 11 are not specifically
enforced. In the event of a breach or threatened breach of the
terms, covenants and/or conditions of either such Section 11
by any of the PARTIES hereto, the other party shall, in
addition to any other remedies it may have, be entitled to a
temporary or permanent injunction, without showing any actual
damage, and/or a decree for specific performance, in
accordance with the provisions of such Section 11.
14.2. NONCOMPETE. Subject to Section 14.2.1 of this Non-Compete
Section 14.2, BIOLASE by itself or through third PARTIES shall
not directly or indirectly enter into the research,
development, prototyping, testing, manufacture, supply,
marketing, distribution, sale, promotion, or commercialization
of any compounds, materials, or products in the P&G FIELDS OF
USE, including the PRIMARY P&G FIELD OF USE, and the [* * *]
Field (if P&G exercises its option) by: (i) developing,
prototyping, conducting research on, manufacturing, supplying,
marketing, selling or distributing any such products or
products competing with such products to any third party other
than P&G; (ii) licensing any intellectual property to any
third party other than P&G for use in connection with the
research, development, prototyping, testing, manufacture,
supply, marketing, distribution, sale, promotion, or
commercialization any such compounds, materials, or products;
(iii) consulting with, supplying compounds, materials, or
products to, cooperating with or providing services to, any
third party other than P&G with respect to the research,
development, prototyping, testing, manufacture, supply,
marketing,
34
distribution, sale, promotion, or commercialization of any
such compounds, materials, or products; or (iv) investing in
any third party other than P&G, that engages in the research,
development, prototyping, testing, manufacture, supply,
marketing, distribution, sale, promotion, or commercialization
of such products, (collectively, the "Restricted Business");
provided, however, that this restriction shall not apply to
BIOLASE directly acquiring a non-controlling ownership
interest of less than fifty percent (50%) of the equity of a
public or private company that engages in a RESTRICTED
BUSINESS if BIOLASE acquires such equity stake in such company
primarily in exchange for obtaining rights (either via an
outright assignment or a license) or access to technology
owned by such company and that is unrelated to the Restricted
Business and such company's market cap does not exceed [* * *
* * *] ($[* * *]). In addition, BIOLASE may acquire a less
than [*] equity stake in any publicly traded or private
company that derives less than [* *] of its revenues from the
Restricted Business.
14.2.1. The time periods of this Non-Compete Section
shall apply to and be effective for/during
the time period that P&G has license rights,
or options thereto (excluding the categories
which revert back to BIOLASE). The terms of
Sections 14.2 and 14.2.1 shall not apply to
(i) categories which have reverted back to
BIOLASE from the P&G FIELDS OF USE, (ii) the
[* * *] Field in the event that P&G does not
exercise its option, and (iii) the BIOLASE
RETAINED FIELD.
14.3. ASSIGNMENT. This AGREEMENT and the rights and obligations
thereunder, may not be assigned, whether by operation of law
or otherwise, or otherwise transferred by either PARTY to a
third party, except as authorized in writing by the other
PARTY or as expressly set forth in Section 10 with respect to
a BIOLASE CHANGE IN CONTROL, except that either PARTY may
assign the rights and obligations under the AGREEMENT, in
whole or in part, to an AFFILIATE existing as of the EFFECTIVE
DATE, or P&G may assign its rights and obligations under this
AGREEMENT to a third party in the event P&G divests,
transfers, or sells to that third party a portion or its
entire business associated with one or more PRODUCTS. Any
attempted assignment or delegation except as permitted herein
shall be null and void. Any assignee of this AGREEMENT under
this Section 14.3 shall covenant to the PARTIES in writing
that such assignee agrees to be bound by all the terms and
conditions of this AGREEMENT applicable to the assignor.
14.4. GOVERNING LAW; VENUE. This AGREEMENT and the PARTIES'
respective rights and obligations hereunder will be governed
by and construed in accordance with the laws of the State of
New York, without giving effect to that body of laws
pertaining to conflict of laws, whether common law or
statutory.
35
14.5. SEVERABILITY. If one or more of the sections, provisions,
paragraphs, words, clauses, phrases or sentences contained
herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any
reason, the validity, legality and enforceability of any such
section, provision, paragraph, word, clause, phrase or
sentence in every other respect and of the remaining sections,
provisions, paragraphs, words, clauses, phrases or sentences
hereof will not be in any way impaired, it being intended that
all rights, powers and privileges of the PARTIES hereto will
be enforceable to the fullest extent permitted by law.
14.6. AMENDMENTS AND WAIVERS. This AGREEMENT may be amended only by
a written instrument executed by both PARTIES. Any amendment
effected in accordance with the immediately preceding sentence
will be binding on all of the PARTIES to this AGREEMENT. No
failure or delay by any Party in exercising any right, power
or privilege hereunder will operate as a waiver thereof nor
will any single or partial exercise thereof preclude any other
or further exercise thereof or the exercise of any other
right, power or privilege.
14.7. ENTIRE AGREEMENT. This AGREEMENT, together with any exhibits,
appendixes and attachments hereto, constitutes the complete
and exclusive agreement between the PARTIES regarding the
subject matter hereof, and supersedes all previous written or
verbal agreements relating on this subject matter between the
PARTIES, and all previous writings are merged and superseded
by this AGREEMENT, including the LETTER, and including the
Bilateral CDA executed on June 22nd, 2006 by the PARTIES, the
Confidential Disclosure Agreement executed on May 5, 2005 by
the PARTIES, and the Amendment to the Confidential Disclosure
Agreement executed on June 5, 2006 by the PARTIES. This
AGREEMENT may be modified only by a written document signed by
all the PARTIES hereto.
14.8. BANKRUPTCY. In the event BIOLASE seeks or is involuntarily
placed under the protection of the bankruptcy laws, Title XI
U.S. Code, and the trustee in bankruptcy rejects this
AGREEMENT, P&G hereby elects, pursuant to Section 365(n), to
retain all rights granted to it under this AGREEMENT to the
extent permitted by law. In the event P&G seeks or is
involuntarily placed under the protection of the bankruptcy
laws, Title XI U.S. Code, and the trustee in bankruptcy
rejects this AGREEMENT, BIOLASE hereby elects, pursuant to
Section 365(n), to retain all rights granted to it under this
AGREEMENT to the extent permitted by law.
14.9. COUNTERPARTS. This AGREEMENT may be executed in one or more
counterparts, and by different PARTIES on separate
counterparts, each of which will be deemed an original and all
of which together will constitute one and the same original.
14.10. NOTICES. Any and all notices required or permitted to be given
to a PARTY pursuant to the provisions of this AGREEMENT will
be in writing and will be effective and deemed to provide such
PARTY sufficient notice under
36
this AGREEMENT on the earliest of the following: (i) at the
time of personal delivery, if delivery is in person; (ii) at
the time of transmission by facsimile, addressed to the other
Party at its facsimile number specified herein (or hereafter
modified by subsequent notice to the PARTIES hereto), with
confirmation of receipt made by both telephone and printed
confirmation sheet verifying successful transmission of the
facsimile; or (iii) one (1) business day after deposit with an
express overnight courier for United States deliveries, or two
(2) business days after such deposit for deliveries outside of
the United States, with proof of delivery from the courier
requested. All notices for delivery outside the United States
will be sent by facsimile or by express courier. Notices by
facsimile shall be machine verified as received. All notices
not delivered personally or by facsimile will be sent with
postage and/or other charges prepaid and properly addressed to
the PARTY to be notified at the address or facsimile number as
follows, or at such other address or facsimile number as such
other PARTY may designate by one of the indicated means of
notice herein to the other PARTIES hereto as follows:
if to P&G:
The Procter & Gamble Company
Two Procter & Gamble Plaza
Cincinnati, Ohio 45202
Attention: Jeffrey D. Weedman
Vice President, External Business Development
With copies to:
[* * *]
[* * *]
[* * *]
[* * *]
[* * *]
[* * *]
if to BIOLASE:
BIOLASE TECHNOLOGY, Inc.
4 Cromwell, Irvine CA 92618
Attention: Richard Harrison
Chief Financial Officer
37
With copies to:
Charles K. Ruck, Esq.
Latham & Watkins, LLP
650 Town Center Drive, 20th Floor
Costa Mesa, CA 92626-1925
Tel: (714) 540-1235
Fax: (714) 755-8290
Email: charles.ruck@lw.com
14.11. PRESS RELEASES AND PUBLIC DISCLOSURE. Any press releases,
public announcements or similar publicity with respect to this
AGREEMENT or the transactions contemplated hereby (including,
without limitation, standard question and answer responses,
scripts for press briefings, and other disclosure) must be
approved by both PARTIES in advance with respect to both
timing and content of the disclosure, provided that nothing
herein will prevent either PARTY or their respective
AFFILIATES, upon reasonable notice to the other PARTY, from
making public disclosures that are necessary to comply with
the requirements of law or any listing agreement with any
national securities exchange.
14.12. FORCE MAJEURE. Should either Party be prevented from
performing its obligations under this AGREEMENT by an event of
force majeure, such as an earthquake, typhoon, flood, fire,
act of war, act of the public enemy, act of terrorism, act of
God or any other unforeseen event the happening and
consequences of which are unpreventable and unavoidable, the
prevented Party shall notify the other PARTY BY the most
expedient means available (fax, telex or express mail being
acceptable in any event) without any delay, and within [* * *]
thereafter provide detailed information of the events and, if
applicable and available, a valid document for evidence issued
by the relevant public notary organization explaining the
reason for its inability to perform or delay in the
performance of all or part of this AGREEMENT. The PARTIES
shall discuss in good faith, taking into account the effects
of the force majeure and other unforeseen events on the
performance of the obligations under this AGREEMENT, whether
to (a) exempt the prevented Party from performing part or all
of its obligations under this AGREEMENT or (b) delay the
performance of the affected obligations under this AGREEMENT.
In the absence of any such agreement, no PARTY shall be
excused from its performance hereunder once the event of force
majeure has subsided.
14.13. FURTHER ASSURANCES. Except as otherwise specifically agreed to
herein, the PARTIES agree to execute such further
documentation and perform such further actions, including the
recordation of such documentation with appropriate
authorities, as may be reasonably requested by the other PARTY
hereto to evidence, effectuate and further the purposes and
intents set forth in this AGREEMENT.
38
14.14. NO THIRD PARTY BENEFICIARIES. Except for the rights of the
INDEMNIFIED PARTIES pursuant to Section 13, nothing in this
AGREEMENT, express or implied, is intended to confer upon any
Person, other than the PARTIES hereto or their respective
successors and permitted assigns, any rights, remedies,
benefits, obligations or liabilities of any nature whatsoever
under or by reason of this AGREEMENT.
IN WITNESS WHEREOF, the PARTIES hereto caused this AGREEMENT to be duly executed
as of the date first written above.
BIOLASE TECHNOLOGY, INC.
By:
--------------------------------------------
Name: Richard L. Harrison
Title: Executive Vice President, CFO & Secretary
THE PROCTER & GAMBLE COMPANY
By:
---------------------------------------------
Name: Jeffrey D. Weedman
Title: Vice President, External Business Development
39
EXHIBIT A
BIOLASE PATENTS WITHIN THE PRIMARY P&G FIELD OF USE
U.S. patent and applications listed in this Exhibit A, including any parent
applications, continuations, continuations-in-part, divisionals, re-exams,
reissues, and any foreign equivalents thereof.
[Enlarge/Download Table]
BIOLASE
Country Status Application No. Publication No. Patent No. Docket No. Title
------- --------- ---------------- ------------------- ------------------ ------------------ -----------
[**] [* * *] [* * *] [* * *] [* * *]
[* * *] [* * *] [* * *]
[* * *] [* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *] [* * *] [* * *]
[* * *] [* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *] [* * *] [* * *]
[* * *] [* * *]
[**] [* * *] [* * *] [* * *]
[* * *] [* * *] [* * *]
[* * *] [* * *]
[**] [* * *] [* * *] [* * *] [* * *] [* * *]
[* * *]
[* * *]
[**] [* * *] [* * *] [* * *]
[* * *]
[* * *]
[**] [* * *] [* * *] [* * *]
[* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *] [* * *]
[* * *]
[* * *]
40
[Download Table]
[**] [* * *] [* * *] [* * *]
[* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *] [* * *]
[* *] [* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *] [* * *]
[* * *] [* *] [* * *]
[* * *] [* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* *] [* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *] [* * *]
[* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *]
[* * *]
41
Exhibit B
BIOLASE PATENTS within THE [* * *] FIELD OF USE
U.S. patents and applications listed in this Exhibit B, including any parent
applications, continuations, continuations-in-part, divisionals, re-exams,
reissues, and any foreign equivalents thereof, and any other patent or patent
application related to the [* * *] Field.
[Enlarge/Download Table]
BIOLASE
Country Status Application No. Publication No. Patent No. Docket No. Title
------- ----------- --------------- ------------------- ------------------ ------------------ -----------
[**] [* * *] [* * *] [* * *] [* * *]
[* * *] [* * *] [* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *] [* * *] [* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *] [* * *] [* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *] [* * *] [* * *]
[**] [* * *] [* * *] [* * *] [* * *] [* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *] [* * *] [* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *]
[* * *]
[**] [* * *] [* * *] [* * *] [* * *]
[* * *]
[* * *]
42
Exhibit C
BIOLASE PATENTS within the P&G FIELDS OF USE (excluding the primary P&G
Field OF USE) and biolase patents within the BIOLASE RETAINED FIELD CATegories
offered to, and accepted by, P&G under Section 2.4.1 (This exhibit c is not
meant to expand thE Rights otherwise granted under this agreement)
(Blank as of EFFECTIVE DATE-BIOLASE to populate [* * *] after the EFFECTIVE
DATE of this AGREEMENT)
43
EXHIBIT D
P&G [* * *] PRODUCT CATEGORIES WITHIN P&G FIELDS OF USE
[* * *] [Remainder of page redacted]
44
EXHIBIT E
PURCHASE PRICE DETERMINATION
Purchase Price refers to purchase by P&G of the BIOLASE PATENTS and
related interests as shall be the subject of an election by P&G to purchase, and
shall be equal to the PURCHASE PRICE agreed to by the PARTIES or the VALUATION
(as defined herein) of such interest to be purchased under this AGREEMENT,
determined as follows: each PARTY shall [* * * * * * * * * *
* * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * ](a "VALUATION").
The [* * *] will be [* * *] VALUATION within [* * *] after the
Purchase Date as defined herein. In the event of a PARTY'S failure to [* * *
* * * * * *] after the Purchase Date, the VALUATION will be the VALUATION
determined by [* * * * * * *].
If the difference between the lower VALUATION and the higher VALUATION is not
more than [* * *] of the higher VALUATION, or if the VALUATIONS are equal, the
final VALUATION shall be the [* * * * *]. If the difference between the
two (2) VALUATIONS is more than [* * *] of the higher VALUATION, the FIRMS
[* * * *] and [* * *] prepare a VALUATION. The [* * *] will not have
access to the VALUATIONS prepared [* * *]. The two (2) VALUATIONS that are the
closest in value then shall be [* * *], and the resulting [* * *] shall be
the final VALUATION.
The purchase of the BIOLASE PATENTS shall thereafter be consummated by payment
of the VALUATION within [* * *] after [* * *] the VALUATIONS [* * * * *]
or such later date upon which all necessary regulatory approvals have been
obtained and/or regulatory waiting periods have expired.
Each PARTY shall bear the expense of obtaining the VALUATION [* * * * * *],
and [* * * *], the expense of obtaining its VALUATION shall be borne
equally by the PARTIES.
Unless otherwise agreed in writing by the PARTIES, the VALUATION for the BIOLASE
PATENTS shall be [* * * * * * * * * * * *
* * * * * * * * * *](such date shall be referred to
as the "Purchase Date").
During the pendency of the option election and VALUATION process, the PARTIES
shall continue to perform their customary activities under this AGREEMENT.
45
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘10-Q’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 5/10/07 | | | | | | | 4 |
| For Period End: | | 3/31/07 |
| | 1/24/07 | | 15 | | | | | 8-K |
| | 6/5/06 | | 36 |
| | 5/5/05 | | 36 |
| List all Filings |
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