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): November 10, 2015

 

 

Biolase, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware  

001-36385

  87-0442441

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

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 November 10, 2015, Biolase, Inc. (the “ Company ”) and Computershare Trust Company, N.A., as rights agent and successor to U.S. Stock Transfer Corporation (the “ Rights Agent ”), entered into a Fourth Amendment to Rights Agreement (the “ Fourth Amendment ”), amending the Rights Agreement dated as of December 31, 1998 (as amended as of December 19, 2008, March 17, 2014 and November 3, 2014, the “ Rights Agreement ”), between the Company and the Rights Agent. The Rights Agreement (as amended) is described in the Company’s Form 8-A, filed with the Securities and Exchange Commission (the “ SEC ”) on December 29, 1998, the Company’s Current Report on Form 8-K, filed with the SEC on December 22, 2008, the Company’s Annual Report on Form 10-K, filed with the SEC on March 17, 2014 and the Company’s Amendment to Form 8-A, filed on November 4, 2014, and such descriptions are incorporated herein by reference.

Effective as of November 10, 2015, the Fourth Amendment accelerates the Expiration Date of the Company’s Series B Junior Participating Cumulative Preferred Stock purchase rights (the “ Rights ”) from December 31, 2018 to November 10, 2015. Accordingly, on November 10, 2015, the Rights expired and the Rights Agreement effectively terminated as of such date.

Prior to entering into the Fourth Amendment, the Company entered into a Standstill Agreement (the “ Schuler Standstill Agreement ”) with Jack W. Schuler, Renate Schuler and the Schuler Family Foundation (collectively, the “ Schuler Parties ”), and the Company entered into a Standstill Agreement (the “ Oracle Standstill Agreement ” and, together with the Schuler Standstill Agreement, the “ Standstill Agreements ”) with Larry N. Feinberg, Oracle Partners, L.P., Oracle Institutional Partners, L.P., Oracle Ten Fund Master, L.P., Oracle Associates, LLC and Oracle Investment Management, Inc. (collectively, the “ Oracle Parties ”). Pursuant to the Standstill Agreements, each of the Schuler Parties and the Oracle Parties agreed with respect to itself and its associates and affiliates (i) not to purchase or acquire any shares of common stock of the Company (the “ Common Stock ”) if such a purchase would result in aggregate beneficial ownership by it and its affiliates and associates in excess of 25% of the issued and outstanding shares of Common Stock and (ii) not to sell, transfer or otherwise convey shares of Common Stock (or warrants or other rights to acquire shares of Common Stock) to anyone who will immediately thereafter beneficially own shares in excess of 20% of the issued and outstanding shares of Common Stock, as a result of such transfer and other transfers from third parties.

According to Amendment No. 5 to Schedule 13D, filed by the Schuler Parties and Jack W. Schuler Living Trust on November 9, 2015, Jack W. Schuler, Renate Schuler, the Jack W. Schuler Living Trust and the Schuler Family Foundation beneficially own 19.99%, 10.68%, 9.37% and 10.65% of the outstanding shares of Common Stock, respectively. Such beneficial ownership includes warrants held by the Schuler Family Foundation to purchase 358,834 shares of Common Stock. The terms of the warrants prohibit the holder of such warrants from exercising the warrants to the extent that the exercise would result in the holder and its affiliates beneficially owning more than 19.99% of the outstanding shares of Common Stock. As such, although the Schuler Family Foundation holds warrants to acquire 3,824,252 Shares, due to the 19.99% blocker, at this time, the Schuler Family Foundation can only exercise warrants to acquire 358,834 Shares.

 

2


According to Amendment No. 10 to Schedule 13D, filed by the Oracle Parties on March 9, 2015, Larry N. Feinberg, Oracle Partners, L.P., Oracle Institutional Partners, L.P., Oracle Ten Fund Master, L.P., Oracle Associates, LLC and Oracle Investment Management, Inc. beneficially own 19.8%, 11.3%, 3.5%, 5.1%, 14.7% and 5.1% of the outstanding shares of Common Stock, respectively. Such beneficial ownership includes warrants held by each of Oracle Partners, L.P., Oracle Institutional Partners, L.P. and Oracle Ten Fund Master, L.P. to purchase 336,047 shares of Common Stock, 470,465 shares of Common Stock and 537,674 shares of Common Stock, respectively. The terms of the warrants prohibit the holder of such warrants from exercising the warrants to the extent that the exercise would result in the holder and its affiliates beneficially owning more than 19.99% of the outstanding shares of Common Stock.

The summary description of the Fourth Amendment and the Standstill Agreements set forth above does not purport to be complete and is qualified in its entirety by reference to the full text of the Fourth Amendment and the Standstill Agreements, which are incorporated herein by reference to Exhibit 4.1, Exhibit 99.1 and Exhibit 99.2 to this Current Report on Form 8-K.

 

Item 1.02. Termination of a Material Definitive Agreement.

The information set forth in Item 1.01 of this Current Report is incorporated into this Item 1.02 by this reference.

 

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

On November 10, 2015, the Company was notified by the Nasdaq Stock Market that it is not in compliance with the continued listing requirements for the Nasdaq Capital Market contained in Nasdaq Listing Rule 5550(a)(2) requiring the Company’s listed securities to have a minimum bid price of $1.00 per share for 30 consecutive trading days. The notification letter does not impact the Company’s listing on the Nasdaq Capital Market at this time. In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company has been provided 180 calendar days, or until May 9, 2016, to regain compliance with Nasdaq Listing Rule 5550(a)(2). To regain compliance, the Company’s common stock must have a closing bid price of at least $1.00 for a minimum of 10 consecutive business days. In the event the Company does not regain compliance by May 9, 2016, the Company may be eligible for an additional 180-day grace period to regain compliance. The Company is considering available options to resolve the noncompliance with the minimum bid price requirement, which may include a reverse stock split. There can be no assurance that the Company will be able to regain compliance with the minimum bid price requirement or will otherwise be in compliance with other Nasdaq listing criteria.

 

Item 3.03. Material Modification to Rights of Security Holders.

As a result of the Fourth Amendment described in Item 1.01 above, the outstanding Rights expired on November 10, 2015.

 

3


Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

Upon the expiration of the Rights as described in Item 3.03 above, on the Company filed a certificate of elimination (the “ Certificate of Elimination ”) with the Secretary of State of the State of Delaware on November 12, 2015, which decreased the number of authorized shares of Series B Junior Participating Cumulative Preferred Stock to zero, and as a result, under the Delaware General Corporation Law, the Series B Junior Participating Cumulative Preferred Stock shall no longer be an authorized series of preferred stock of the Company. Prior to the filing, the Series B Junior Participating Cumulative Preferred Stock would have been issuable, under certain circumstances, upon the exercise of the Rights.

The summary description of the Certificate of Elimination set forth above does not purport to be complete and is qualified in its entirety by reference to the full text of the Certificate of Elimination, which is incorporated herein by reference to Exhibit 3.1 to this Current Report on Form 8-K.

 

Item 9.01. Financial Statements and Exhibits.

 

  (d) Exhibits

 

Exhibit
Number

  

Description

  3.1    Certificate of Elimination of Series B Junior Participating Cumulative Preferred Stock, dated as of November 12, 2015.
  4.1    Fourth Amendment to Rights Agreement, dated November 10, 2015, by and between the Company and Computershare Trust Company, N.A.
99.1    Standstill Agreement, dated November 10, 2015, by and among Jack W. Schuler, Renate Schuler, Schuler Family Foundation and the Company.
99.2    Standstill Agreement, dated November 10, 2015, by and among Larry N. Feinberg, Oracle Partners, L.P., Oracle Institutional Partners, L.P., Oracle Ten Fund Master, L.P., Oracle Associates, LLC, Oracle Investment Management, Inc. and the Company.

 

4


SIGNATURE

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.
Date: November 12, 2015     By:  

/s/ David C. Dreyer

    Name: David C. Dreyer
    Title: SVP and Chief Financial Officer

 

5


EXHIBIT INDEX

 

Exhibit
Number

  

Description

  3.1    Certificate of Elimination of Series B Junior Participating Cumulative Preferred Stock, dated as of November 12, 2015.
  4.1    Fourth Amendment to Rights Agreement, dated November 10, 2015, by and between the Company and Computershare Trust Company, N.A.
99.1    Standstill Agreement, dated November 10, 2015, by and among Jack W. Schuler, Renate Schuler, Schuler Family Foundation and the Company.
99.2    Standstill Agreement, dated November 10, 2015, by and among Larry N. Feinberg, Oracle Partners, L.P., Oracle Institutional Partners, L.P., Oracle Ten Fund Master, L.P., Oracle Associates, LLC, Oracle Investment Management, Inc. and the Company.

 

6

Exhibit 3.1

CERTIFICATE OF ELIMINATION

OF

BIOLASE, INC.

*  *  *  *  *  *  *  *

Pursuant to the provisions of Section 151(g) of the General Corporation Law of the State of Delaware, Biolase, Inc., a corporation organized and existing under the laws of the State of Delaware (the “ Company ”), hereby certifies as follows:

FIRST: That at a meeting of the Board of Directors of the Company, resolutions were duly adopted setting forth the proposed elimination of the series of stock as set forth herein:

RESOLVED FURTHER, that no shares of the Series B Junior Participating Cumulative Preferred Stock, par value $0.001 per share, of the Company (the “ Series B Preferred Stock ”) are outstanding and none will be issued;

RESOLVED FURTHER, that the proper officers of the Company be, and each of them hereby is, authorized to, personally or by attorney, in the name and on behalf of the Company, execute, deliver and cause to be filed with the Secretary of State of the State of Delaware a Certificate of Elimination pursuant to the provisions of Section 151(g) of the General Corporation Law of the State of Delaware for the purpose of eliminating from the Company’s Restated Certificate of Incorporation, as amended, all reference to the Series B Preferred Stock;

SECOND: That the Certificate of Designation with respect to the Series B Preferred Stock was filed in the office of the Secretary of State of the State of Delaware on December 24, 1998. None of the authorized shares of the Series B Preferred Stock are outstanding, and none will be issued.

THIRD: That in accordance with the provisions of Section 151 of the General Corporation Law of the State of Delaware, the Company’s Restated Certificate of Incorporation, as amended, is hereby further amended to eliminate all reference to the Series B Preferred Stock.

*        *        *         *        *


IN WITNESS WHEREOF, Biolase, Inc. has caused this certificate to be signed by Michael C. Carroll, its Secretary, this 12 th day of November, 2015.

 

BIOLASE, INC.
By:  

/s/ Michael C. Carroll

  Name: Michael C. Carroll
  Title: Secretary

Attest:

 

By:  

/s/ Harold C. Flynn, Jr

  Name: Harold C. Flynn, Jr.
  Title: President and Chief Executive Officer

Exhibit 4.1

FOURTH AMENDMENT TO RIGHTS AGREEMENT

THIS FOURTH AMENDMENT TO RIGHTS AGREEMENT (this “ Amendment ”) is made and entered into as of November 10, 2015, by and between BIOLASE, INC., a Delaware corporation (the “ Company ”), and COMPUTERSHARE TRUST COMPANY, N.A., as successor to U.S. Stock Transfer Corporation, a California corporation (the “ Rights Agent ”).

WHEREAS, the Company and the Rights Agent entered into a Rights Agreement dated as of December 31, 1998 (as amended as of December 19, 2008, March 17, 2014 and November 3, 2014, the “ Agreement ”);

WHEREAS, Section 27 of the Agreement provides, among other things, that, prior to a Section 11(a)(ii) Event, a Section 13(a) Event, the Redemption Date or the Expiration Date, the Board of Directors of the Company may, from time to time, supplement or amend any provision of the Agreement in any manner without the approval of any holders of Rights;

WHEREAS, no Section 11(a)(ii) Event, Section 13(a) Event, Redemption Date or Expiration Date has occurred as of the date hereof;

WHEREAS, the Board of Directors of the Company has determined it is in the best interests of the Company and its stockholders to amend the Agreement as set forth herein; and

WHEREAS, pursuant to its authority under Section 27 of the Agreement, the Board of Directors of the Company has authorized and approved this Amendment to the Agreement.

NOW, THEREFORE, for good consideration, the adequacy of which is hereby acknowledged, the Company hereby agrees to amend the Agreement as follows and directs the Rights Agent to execute this Amendment:

1. Section 1 of the Agreement is hereby amended by amending and restating the definition of “Expiration Date” as follows:

“Expiration Date” shall mean November 10, 2015.

All references to December 31, 2018 in Exhibit A to the Agreement shall be deemed to refer to November 10, 2015

2. This Amendment is effective as of the date first set forth above.

3. Capitalized terms used but not defined herein shall have the respective meanings ascribed to such terms in the Agreement.

4. This Amendment may be executed in any number of counterparts and each such counterpart shall for all purposes be deemed to be an original and all such counterparts shall together constitute but one and the same instrument. A signature to this Amendment executed and/or transmitted electronically shall have the same authority, effect and enforceability as an original signature.

5. Except as modified hereby, the Agreement is reaffirmed in all respects, and all


references therein to “the Agreement” shall mean the Agreement, as modified hereby. Notwithstanding anything to the contrary herein or in the Agreement, each of the Company and the Rights Agent hereby acknowledges and agrees that at the Close of Business on the Expiration Date (as amended hereby), the Agreement shall terminate and be of no further force and effect.

* * * * *

 

2


IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first written above.

 

BIOLASE, INC.

/s/ Michael Carroll

By: Michael Carroll

Its: Secretary

COMPUTERSHARE TRUST COMPANY, N.A.

/s/ Dennis V. Moccia

By: Dennis V. Moccia
Its: Manager, Contract Administration

Exhibit 99.1

November 10, 2015

Biolase, Inc.

4 Cromwell

Irvine, California 92618

 

  Re: Standstill Agreement

Ladies and Gentlemen:

In consideration for Biolase, Inc. (“ Biolase ”) agreeing to terminate its Rights Agreement dated as of December 31, 1998 (as amended as of December 19, 2008, March 17, 2014 and November 3, 2014), the undersigned hereby agree that (i) neither we nor any of our affiliates or associates (as defined in the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”)) shall purchase or acquire any additional shares of Biolase’s common stock, par value $0.001 per share (the “ Common Stock ”), if, after such purchase, the aggregate beneficial ownership (as determined in accordance with Rule 13d-3 under the Exchange Act) of us and our affiliates and associates would exceed 25% of the issued and outstanding shares of Common Stock, and (ii) neither we nor any of our affiliates or associates shall sell, transfer or otherwise convey any shares of Common Stock (or warrants or other rights to purchase or otherwise acquire shares of Common Stock) to anyone who will immediately thereafter beneficially own shares of Common Stock in excess of 20% of the issued and outstanding shares of Common Stock (calculated based on the number of shares of Common Stock then outstanding plus shares of Common Stock that could be issued to such person upon the exercise of outstanding options, warrants or other rights held by such person that are then exercisable or exercisable within 60 days of such transfer), as a result of such transfer and other transfers from third parties.

We acknowledge that irreparable damage would occur to Biolase if any of the provisions of this agreement were breached. Accordingly, we agree that Biolase, without prejudice to any rights and remedies otherwise available, shall be entitled to equitable relief, including, without limitation, specific performance and injunction, in the event of any breach or threatened breach by us or any of our affiliates or associates of this agreement without proof of actual damages. We will not oppose the granting of such relief on the basis that Biolase has an adequate remedy at law. We also will not seek, and will waive any requirement for, the securing or posting of a bond in connection with Biolase’s seeking or obtaining such relief.

This agreement shall be governed by, and construed in accordance with, the internal laws of the State of Delaware without giving any effect to principles of conflicts of laws.

[ Signatures follow ]


Sincerely,

/s/ Jack W. Schuler

Jack W. Schuler

/s/ Renate Schuler

Renate Schuler
Schuler Family Foundation
By:  

/s/ Jack W. Schuler

  Name: Jack W. Schuler
  Title: Trustee

 

The foregoing is hereby accepted:
Biolase, Inc.
By:  

/s/ Michael Carroll

  Name: Michael Carroll
  Title: Secretary

[ Signature Page to Standstill Agreement ]

Exhibit 99.2

November 10, 2015

Biolase, Inc.

4 Cromwell

Irvine, California 92618

 

  Re: Standstill Agreement

Ladies and Gentlemen:

In consideration for Biolase, Inc. (“ Biolase ”) agreeing to terminate its Rights Agreement dated as of December 31, 1998 (as amended as of December 19, 2008, March 17, 2014 and November 3, 2014), the undersigned hereby agree that (i) neither we nor any of our affiliates or associates (as defined in the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”)) shall purchase or acquire any additional shares of Biolase’s common stock, par value $0.001 per share (the “ Common Stock ”), if, after such purchase, the aggregate beneficial ownership (as determined in accordance with Rule 13d-3 under the Exchange Act) of us and our affiliates and associates would exceed 25% of the issued and outstanding shares of Common Stock, and (ii) neither we nor any of our affiliates or associates shall sell, transfer or otherwise convey any shares of Common Stock (or warrants or other rights to purchase or otherwise acquire shares of Common Stock) to anyone who will immediately thereafter beneficially own shares of Common Stock in excess of 20% of the issued and outstanding shares of Common Stock (calculated based on the number of shares of Common Stock then outstanding plus shares of Common Stock that could be issued to such person upon the exercise of outstanding options, warrants or other rights held by such person that are then exercisable or exercisable within 60 days of such transfer), as a result of such transfer and other transfers from third parties.

We acknowledge that irreparable damage would occur to Biolase if any of the provisions of this agreement were breached. Accordingly, we agree that Biolase, without prejudice to any rights and remedies otherwise available, shall be entitled to equitable relief, including, without limitation, specific performance and injunction, in the event of any breach or threatened breach by us or any of our affiliates or associates of this agreement without proof of actual damages. We will not oppose the granting of such relief on the basis that Biolase has an adequate remedy at law. We also will not seek, and will waive any requirement for, the securing or posting of a bond in connection with Biolase’s seeking or obtaining such relief.

This agreement shall be governed by, and construed in accordance with, the internal laws of the State of Delaware without giving any effect to principles of conflicts of laws.

[ Signatures follow ]


Sincerely,

/s/ Larry N. Feinberg

  LARRY N. FEINBERG
ORACLE PARTNERS, L.P.
    By: ORACLE ASSOCIATES, LLC, its general     partner
  By:  

/s/ Larry N. Feinberg

    Larry N. Feinberg, Managing Member
ORACLE INSTITUTIONAL PARTNERS, L.P.
    By: ORACLE ASSOCIATES, LLC, its general     partner
  By:  

/s/ Larry N. Feinberg

    Larry N. Feinberg, Managing Member
ORACLE TEN FUND MASTER, L.P.
    By: ORACLE ASSOCIATES, LLC, its general     partner
  By:  

/s/ Larry N. Feinberg

    Larry N. Feinberg, Managing Member
ORACLE ASSOCIATES, LLC
    By:  

/s/ Larry N. Feinberg

  Larry N. Feinberg, Managing Member
ORACLE INVESTMENT MANAGEMENT, INC.
    By:  

/s/ Larry N. Feinberg

  Larry N. Feinberg, Managing Member

 

The foregoing is hereby accepted:
Biolase, Inc.
By:  

/s/ Michael Carroll

  Name: Michael Carroll
  Title: Secretary

[ Signature Page to Standstill Agreement ]