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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): September 27, 2006
ALIGN TECHNOLOGY, INC.
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(Exact Name of Registrant as Specified in Its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
0-32259 94-3267295
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(Commission File Number) (IRS Employer Identification No.)
881 Martin Avenue, Santa Clara, California 95050
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(Address of Principal Executive Offices) (Zip Code)
(408) 470-1000
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(Registrant's Telephone Number, Including Area Code)
Not applicable
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(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 (see General Instruction A.2. below):
[ ] 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))
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ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On September 27, 2006, Align Technology, Inc. ("Align") entered into a
Binding Settlement Term Sheet with OrthoClear, Inc., OrthoClear Holdings, Inc.,
and OrthoClear Pakistan Pvt. Ltd. ("OrthoClear") to end all pending litigation
between the parties and execute a formal settlement agreement within fifteen
days (the "Settlement". Effective immediately, OrthoClear will no longer accept
new patient cases for treatment. Upon the earlier of the Closing of the formal
settlement agreement or October 12, 2006, OrthoClear will consent to the entry
of an Exclusion Order by the International Trade Commission (ITC), prohibiting
importation of OrthoClear aligners into the United States, and will assign and
transfer to Align all intellectual property rights with application to the
correction of malocclusion.
The Settlement includes the following terms:
- Effective immediately, OrthoClear will stop accepting new patient cases for
treatment;
- OrthoClear will consent to the entry of an exclusion order by the United
States International Trade Commission (ITC), enforced by the United States
Customs Service, which prevents OrthoClear from importing its dental
aligner products into the U.S., either directly or through a third party;
- OrthoClear and Zia Chishti, its CEO, and Charlie Wen, its President, will
transfer and assign to Align all intellectual property rights with
application to the treatment of malocclusion;
- OrthoClear principals Zia Chishti, Charlie Wen, Peter Riepenhausen, and
Christopher Kawaja will sign 5-year, global non-compete agreements in the
field of removable aligner therapy products and related software market;
- OrthoClear employees Joe Breeland and Jeff Tunnell will sign 5-year U.S.
non-compete agreements prohibiting their personal participation in the
removable aligner therapy product and related software market;
- Align will make Invisalign treatment available to OrthoClear patients in
the United States, Canada and Hong Kong at no charge from Align;
- The Parties will dismiss all pending litigation against each other and
release all related claims;
- Align will make a one-time cash payment of $10 million to OrthoClear
Holdings, Inc.
The Settlement further provides that Align will pay OrthoClear an additional $10
million if, at or prior to the Closing of the formal settlement agreement,
OrthoClear obtains requisite approval from its shareholders to discontinue all
design, manufacture, marketing and sales of removable dental aligners worldwide.
If at the Closing OrthoClear does not have the requisite shareholder approval,
Align will place $10 million in escrow for a period of 30 days. If OrthoClear
obtains and certifies the requisite shareholder approval on or prior to the 30th
day, the escrowed amount plus accrued interest will be released to OrthoClear.
If OrthoClear does not certify that it has shareholder approval by the 30th day,
all escrowed funds will be returned to Align and Align shall have no further
payment obligation.
The foregoing description of the Settlement does not purport to be complete
and is qualified in its entirety by reference to the Binding Settlement Term
Sheet, a copy of which is attached to this report as Exhibit 10.1, and
incorporated herein by reference.
ITEM 8.01 OTHER EVENTS
On September 28, 2006, the Company announced that it reached an agreement
to end OrthoClear litigation. The full text of the press release is attached
hereto as Exhibit 99.1.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(d) EXHIBITS.
EXHIBIT NO. DESCRIPTION
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10.1 Binding Settlement Term Sheet
99.1 Press Release dated September 28, 2006 announcing agreement to
end OrthoClear litigation
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: September 28, 2006 ALIGN TECHNOLOGY, INC.
By: /s/ Eldon M. Bullington
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Eldon M. Bullington
Vice President of Finance and
Chief Financial Officer
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
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10.1 Binding Settlement Term Sheet
99.1 Press Release dated September 28, 2006 announcing agreement to
end OrthoClear litigation