Material Agreement Form 8 K

Item 1.01 Entry into a Material Definitive Agreement

On September 30, 2024, Sonendo, Inc., a Delaware corporation (the "Company"), entered into an Asset Purchase Agreement (the "Asset Purchase Agreement") with Biolase, Inc., a Delaware corporation ("Biolase"), BL Acquisition Corp., a Delaware corporation ("BL Acquisition"), BL Acquisition II, Inc., a Delaware corporation ("BL Acquisition II"), and Model Dental Office, LLC, a Delaware limited liability company ("MDO" and together with Biolase, BL Acquisition and BL Acquisition II, each a "Seller" and collectively, the "Sellers"), pursuant to which, subject to the terms and conditions set forth in the Asset Purchase Agreement, the Company agreed to acquire certain assets of the Sellers and their subsidiaries on an as-is, where-is basis, including specified inventory, intellectual property and intellectual property rights, products, contracts, equipment and other personal property, records, and intangibles related to the business of developing, manufacturing, marketing and selling dental laser systems, all tissue lasers, soft tissue lasers and other medical devices, as conducted by the Sellers and their subsidiaries (collectively, the "Assets"), and assume certain specified liabilities of the Sellers and their subsidiaries (collectively, the "Liabilities" and such acquisition of the Assets and assumption of the Liabilities together, the "Transaction") for a total purchase price of (i) $14 million in cash subject to a downward working capital adjustment, (ii) the assumption of liabilities and (iii) the value of the Delaware Litigation (as defined in the Asset Purchase Agreement) (the "Purchase Price"). The Company will deliver 10% of the Purchase Price to an escrow agent, which may be returned to the Company in the event of specified events, including termination of the Asset Purchase Agreement, subject to certain exceptions relating to a breach of the Asset Purchase Agreement by the Company.

The Sellers, together with certain of their subsidiaries, is a debtor in a voluntary Chapter 11 case before the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"), which commenced on October 1, 2024. Upon Bankruptcy Court approval, the Company will be designated as the "stalking horse" bidder in connection with a sale of the Assets under Section 363 of Title 11 of the United States Code. The Transaction will be conducted through a Bankruptcy Court-supervised process pursuant to Bankruptcy Court-approved bidding procedures and is subject to the receipt of higher or better offers from competing bidders at an auction, approval of the sale by the Bankruptcy Court, and the satisfaction of certain conditions. Subject to Bankruptcy Court approval, if the Asset Purchase Agreement is terminated because the Sellers sell the Assets to a competing bidder at the auction, the Sellers may be required to pay the Company a break-up fee equal to 3% of the Purchase Price plus a capped expense reimbursement. The Company can give no assurances of the outcome of the Transaction and whether the Company will be successful in acquiring the Assets pursuant to the Asset Purchase Agreement.

The Asset Purchase Agreement contains customary representations, warranties and covenants of the parties for a transaction involving the acquisition of assets from a debtor in bankruptcy, and the completion of the Transaction is subject to a number of customary conditions, which, among others, include the entry of an order of the Bankruptcy Court authorizing and approving the Transaction, the performance by each party of its obligations under the Asset Purchase Agreement and the material accuracy of each party's representations. The Asset Purchase Agreement contains certain termination rights for both the Company and the Sellers, including the right to terminate the Asset Purchase Agreement if the Transaction is not consummated by December 31, 2024 or the Sellers enter into a transaction with a competing bidder.

The foregoing summary of the Asset Purchase Agreement is not complete and is qualified in its entirety by reference to the full text of the Asset Purchase Agreement, a copy of which is attached hereto as Exhibit 2.1 and is incorporated herein by reference.

The representations, warranties and covenants set forth in the Asset Purchase Agreement have been made only for purposes of the Asset Purchase Agreement and solely for the benefit of the parties thereto, and may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Asset Purchase Agreement instead of establishing these matters as facts. In addition, information regarding the subject matter of the representations and warranties made in the Asset Purchase Agreement may change after the date of the Asset Purchase Agreement. Accordingly, the Asset Purchase Agreement is included with this Current Report on Form 8-K only to provide investors with information regarding its terms and not to provide investors with any other factual information regarding the Company, its subsidiaries, the Assets or Liabilities, or the Company's or its subsidiaries' respective businesses as of the date of the Asset Purchase Agreement or as of any other date.