NOTE 12—SUBSEQUENT EVENT

Convertible Preferred Stock and Warrant Transaction

On April 18, 2017, the Company completed a private placement with several institutional and individual investors and certain of its directors and officers, under which the Company sold an aggregate of 80,644 shares of Preferred Stock and Warrants to purchase up to an aggregate of 3,925,871 unregistered shares of BIOLASE common stock at the Exercise Price, subject to customary anti-dilution adjustments. Each share of Preferred Stock converts automatically into shares of BIOLASE common stock upon receipt of stockholder approval and was initially convertible into 100 shares of common stock, reflecting a conversion price equal to 1.24 per share, which is the closing price of BIOLASE common stock quoted on the NASDAQ Capital Market on April 10, 2017. The shares of Preferred Stock have no other conversion rights. The Warrants become exercisable on October 18, 2017 and expire five years after the date of issuance or, if earlier, five business days after the Company delivers notice that the closing price per share of BIOLASE common stock exceeded the Exercise Price for 20 consecutive trading days during the exercise period. Gross proceeds from the sale were approximately $10.5 million.