8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): February 28, 2014

Biolase, Inc.
__________________________________________
(Exact name of registrant as specified in its charter)

Delaware	000-19627	87-0442441
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
4 Cromwell, Irvine, California		92618
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 949-361-1200

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On March 4, 2014, the Company and Comerica Bank ("Comerica") entered into a letter agreement (the "Agreement"). The Agreement waives non-compliance with certain terms and conditions of the Company's loan agreements with Comerica, and reduces the maximum amounts available for borrowing under the revolving line of credit and export revolver to $2.5 million each, for a total of $5.0 million in total amounts available for borrowing from Comerica. In connection with the Agreement, the Company incurred a fee of $10,000 paid to Comerica in connection with Comerica's processing of the Agreement.

The Agreement is incorporated by reference and is attached hereto as Exhibit 10.1.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Appointment of New Directors

On February 28, 2014, the Board of Directors (the "Board") of Biolase, Inc. (the "Company") appointed Paul Clark and Jeffrey Nugent to the Board.

Mr. Clark previously served as Chairman, CEO, and President of ICOS Corporation from 1999 to 2007. From 1984 to 1998, he worked at Abbott Laboratories ("Abbott") as the President of the Pharmaceuticals Division and retiring as an Abbott board member and Executive Vice President. He is currently a member of the board of directors of Agilent Technologies, Inc., Catalent, and Cerevast Therapeutics. Mr. Clark received a B.A. in finance from the University of Alabama and an M.B.A from Dartmouth College.

There are no understandings or arrangements between Mr. Clark or any other person and the Company or any of its subsidiaries pursuant to which Mr. Clark was selected to serve as a director of the Company. There are no family relationships between Mr. Clark and any director, executive officer or person nominated or chosen by the Company to become a director or executive officer, and there are no transactions between Mr. Clark or any of his immediate family members and the Company or any of its subsidiaries.

Mr. Nugent was founder, President, and CEO of Precision Dermatology, Inc. a multi-channel skin care company that was acquired by Valeant Pharmaceuticals in February 2014. From 1999 to 2002, he served as the President and Chief Executive Officer of Revlon, Inc. and as Worldwide President and Chief Executive Officer of Neutrogena Corporation from 1995 to 1999. He is currently a director of Myoscience, Inc. Mr. Nugent holds an M.B.A. in Marketing and Finance from Loyola University in Chicago and a B.S. degree in Mathematics from St. Joseph’s College.

There are no understandings or arrangements between Mr. Nugent or any other person and the Company or any of its subsidiaries pursuant to which Mr. Nugent was selected to serve as a director of the Company. There are no family relationships between Mr. Nugent and any director, executive officer or person nominated or chosen by the Company to become a director or executive officer, and there are no transactions between Mr. Nugent or any of her immediate family members and the Company or any of its subsidiaries.

Pursuant to the terms of the Company’s 2002 Stock Incentive Plan, upon their appointment to the Board, Messrs. Clark and Nugent each received an automatic option grant to purchase 23,750 shares of the Company’s common stock at the closing price $3.09 on February 28, 2014. Each automatic option is immediately exercisable for all of the option shares. However, any shares purchased under such option are subject to repurchase by the Company, at the lower of the exercise price paid per share or the fair market value per share (determined at the time of repurchase), should they cease Board service prior to vesting of those shares. The shares vest, and the Company's right of repurchase lapses, in four successive quarterly installments upon Messrs. Clark and Nugent's completion of each quarter of service as a non-employee director measured from the grant date. The shares subject to the option grant will immediately vest in full if certain changes in control or ownership occur or if Messrs. Clark and Nugent die or become disabled while serving as a director.

As a result of these appointments, BIOLASE’s Board currently consists of eight directors, six of whom are independent directors.

Item 7.01 Regulation FD Disclosure.

On March 3, 2014, the Company issued a press release announcing the appointments of Messrs. Clark and Nugent to the Board, a copy of which is attached as Exhibit 99.1 to this Current Report on Form 8-K.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits. See "Exhibit Index" attached to this Current Report on Form 8-K, which is incorporated by reference.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Biolase, Inc.
March 5, 2014	By:	/s/ Federico Pignatelli
		Name: Federico Pignatelli
		Title: Chief Executive Officer

Exhibit Index

Exhibit No.	Description
10.1	Letter Agreement, dated March 4, 2014, by and between Biolase, Inc. and Comerica Bank.
99.1	Press Release, dated March 3, 2014, of Biolase, Inc.

EX-10.1

[LETTERHEAD OF COMERICA BANK]

March 4, 2014

Biolase, Inc.
4 Cromwell
Irvine, CA 92618
Attention: Frederick D. Furry, Chief Financial Officer

Re: Loan and Security Agreement dated May 24, 2012 between Biolase, Inc. (“Borrower”) and Comerica Bank (“Bank”) as amended (“Loan Agreement”) and the Letter Agreement dated May 24, 2012 between Borrower and Bank (“Ex-Im Facility Agreement”).

Ladies and Gentlemen:

This letter refers to both the Loan Agreement and the Loan Documents as defined therein and the Ex-Im Facility Agreement and the Documents as defined therein (collectively, the “Bank Documents”). Except as otherwise stated in this letter, all capitalized terms used in this letter without an associated definition shall have the meanings given to them in the Loan Agreement.

Borrower is not in compliance with the Loan Agreement because as of December 31, 2013, Borrower did not comply with Section 6.7(b) thereof, and as of January 31, 2014, Borrower did not comply with Sections 6.2(a), 6.2(i), 6.7(a)(i) and 6.7(a)(ii) thereof (“Non Compliance Events”).

By virtue of Section 5 of the Ex-Im Facility Agreement, which by its terms incorporates by reference the covenants and other provisions of the Loan Agreement, each of the foregoing constitutes a failure by Borrower to comply with the terms of the Ex-Im Facility Agreement.

At Borrower’s request, Bank hereby waives the Non-Compliance Events provided that:

(i) Borrower does not make any request for an advance under either the Revolving Line or the Export Revolving Loan (the “Loan Facilities”) in any amount that would cause the outstanding principal balance of either of the Loan Facilities to exceed $2,500,000.00 (the “Facility Limit”) until the time, if ever, that Bank acting in its sole and unrestricted discretion agrees in writing to reinstate the full amount (or any increased amount) of either or both of the Loan Facilities; and Borrower agrees that if for any reason the outstanding principal amount of either of the Loan Facilities exceeds the Facility Limit at any time, the amount of such excess shall be immediately due and payable without notice or demand and the waiver given by this letter shall be automatically rescinded;

(ii) no later than March 7, 2014, Borrower pays Bank a fee of $10,000.00; and

(iii) no later than March 7, 2014 Borrower signs and returns a copy of this letter evidencing its agreement with the terms hereof.

This letter is not a waiver of or consent to any other event, condition, transaction, act or omission whether related or unrelated to the forgoing, except as expressly stated above. All provisions of the Bank Documents shall remain in full force and effect and shall continue to be valid, binding and enforceable in accordance with their respective terms. The waiver given in this letter does not extend to, affect or impair any right of the Bank due to any obligation, covenant, agreement, default or event of default to which it does not expressly consent or which it does not expressly waive. No amendment or modification of this letter or any of the Bank Documents shall be effective without the express written consent of the Bank.

Very truly yours,

Comerica Bank

By /s/ David Ferree
David Ferree
Its: Vice President

Acknowledgement of Borrower

Borrower hereby acknowledges and agrees with the terms of the foregoing letter from Comerica Bank and further agrees as follows:

1. As of the date hereof Borrower has absolutely no defenses, claims, rights of set-off, or counterclaims against Bank under, arising out of, or in connection with, the Bank Documents.

2. Except for the obligations arising hereafter under the Bank Documents, Borrower hereby absolutely discharges and releases Bank, any person or entity that has obtained any interest from Bank under the Bank Documents and each of Bank’s and such entity’s former and present partners, stockholders, officers, directors, employees, successors, assignees, agents and attorneys from any known or unknown claims which Borrower now has against Bank of any nature, including any claims that Borrower, its successors, counsel, and advisors may in the future discover they would have now had if they had known facts not now known to them, whether founded in contract, in tort or pursuant to any other theory of liability, including but not limited to any claims arising out of or related to the Bank Documents or the transactions contemplated thereby.

3. Borrower waives the provisions of California Civil Code Section 1542, which states:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

4. The provisions of this acknowledgement shall survive payment in full of the indebtedness and obligations of Borrower to Bank under the Bank Documents, full performance of all the terms of the Bank Documents, and/or Bank’s actions to exercise any remedy available under the Bank Documents or otherwise.

Dated March 4, 2014.

Biolase, Inc.

By: /s/ Frederick D. Furry
Name: Frederick D. Furry
Title: Chief Financial Officer

NEWS RELEASE

BIOLASE ADDS TWO NEW INDEPENDENT DIRECTORS TO ITS BOARD

Paul Clark, Former Chairman, CEO, and President of ICOS Corporation and Former President of the Pharmaceuticals Division of Abbott Laboratories, and

Jeffrey Nugent, Former President and CEO of both Neutrogena and Revlon,

Join Board of Directors

IRVINE, CA (March 3, 2014) — BIOLASE, Inc. (NASDAQ:BIOL), the world’s leading manufacturer and distributor of dental lasers, including the Company’s proprietary WaterLase®, and a pioneer in laser surgery in other medical specialties, as well as a distributor of digital radiography, intra oral scanners, and chair-side milling machines and 3-D printers for dentistry, today announced that the Board of Directors (the “Board”) has appointed Paul Clark and Jeffrey Nugent to the Board. Dr. Alexander K. Arrow and Dr. Sam Low tendered their resignations from the Board on February 28, 2013. As a result of these appointments and resignations, BIOLASE’s Board currently consists of six directors, five of whom are independent directors.

Paul Clark served as Chairman, CEO, and President of ICOS Corporation from 1999 to 2007, which was acquired by Lilly in 2007 for $2.2 billion. He directed ICOS from a research organization into a leading biotechnology company including researching, developing, and marketing Cialis. From 1984 to 1998, Mr. Clark worked at Abbott Laboratories (“Abbott”) as the President of the Pharmaceuticals Division and retiring as an Abbott board member and Executive Vice President. Sales of the Pharmaceuticals Division icreased from $250 million to $2.6 billion during his tenure as President.

Mr. Clark said, “BIOLASE’s technology leadership, dominant market position, valuable patent portfolio, and product pipeline make it an exciting opportunity.”

Mr. Clark received a B.A. in finance from the University of Alabama and an M.B.A from Dartmouth College. He is currently a board member of Agilent Technologies, Inc., Catalent, and Cerevast Therapeutics.

Jeffrey Nugent has been President and CEO of Neutrogena and Revlon as well as Chief Executive Officer, Chairman and Board Member in global health, personal and beauty care companies across a wide range of strategic situations. His passion is overcoming growing pains.

Most recently, Mr. Nugent was Founder, President and CEO of Precision Dermatology, a multi-channel skin care company that was acquired by Valeant Pharmaceuticals in February 2014.

Mr. Nugent said, “I’m delighted to be a part of BIOLASE. The combination of the Company’s market leadership position, unique technology, and focus on their customers represents an outstanding growth opportunity.”

Mr. Nugent began his career with Johnson & Johnson and progressed in increasing responsibilities in finance, operations, marketing, research and development as well as becoming corporate Vice President for Global Quality. He led the acquisition of Neutrogena and became worldwide President and CEO during its high growth phase of becoming one of the most respected personal care brands in the world. Following this he became President and CEO of Revlon. At Revlon he led a turnaround in financial stability and new product innovation.

Mr. Nugent served as an artillery officer in the U.S. Army and was stationed at the Pentagon in Intelligence/Operations Research working directly with the Central Intelligence Agency and the National Security Agency. He has both a B.S. degree in mathematics and an M.B.A. in finance and marketing.

“I am thrilled to have both Paul Clark and Jeff Nugent join the Board of BIOLASE. They both bring outstanding levels of business knowledge and formidable management skills that will serve our shareholders well in the coming years” said Federico Pignatelli, Chairman and Chief Executive Officer. “As BIOLASE is poised to expand its business beyond its current core base in dentistry, it will require the depth and experience in planning and execution that both skillfully possess.”

About BIOLASE, Inc.
BIOLASE, Inc. is a biomedical company that develops, manufactures, and markets innovative lasers in dentistry and medicine and also markets and distributes high-end 2D and 3D digital , CAD/CAM intraoral scanners, and in-office milling machines and 3D printers; products that are focused on technologies that advance the practice of dentistry and medicine. The Company’s proprietary laser products incorporate approximately 300 patented and patent-pending technologies designed to provide biologically clinically superior performance with less pain and faster recovery times. Its innovative products provide cutting-edge technology at competitive prices to deliver the best results for dentists and patients. BIOLASE’s principal products are revolutionary dental laser systems that perform a broad range of dental procedures, including cosmetic and complex surgical applications, and a full line of dental imaging equipment. BIOLASE has sold more than 25,000 lasers. Other laser products under development address ophthalmology and other medical and consumer markets.

For updates and information on WaterLase and laser dentistry, find BIOLASE online at www.biolase.com, Facebook at www.facebook.com/biolase, Twitter at www.twitter.com/biolaseinc, Pinterest at www.pinterest.com/biolase, LinkedIn at www.linkedin.com/company/biolase, Google+ at www.google.com/+BIOLASEIrvine, Instagram at www.instagram.com/biolaseinc and YouTube at www.youtube.com/biolasevideos.

BIOLASE^® and WaterLase^® are registered trademarks of BIOLASE, Inc.

For further information, please contact:
Michael Porter
Porter, LeVay & Rose, Inc.
212-564-4700