SD

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM SD

SPECIALIZED DISCLOSURE REPORT

BIOLASE, INC.

(Exact name of registrant as specified in its charter)

Delaware	000-19627	87-0442441
(State or other jurisdiction	(Commission File Number)	(I.R.S. Employer
of incorporation or organization)		Identification No.)

4 Cromwell

Irvine, California 92618

(Address of Principal Executive Offices, including zip code)

(949) 361-1200

(Registrant’s Telephone Number, Including Area Code)

David Dreyer	(949) 226-8124
(Name and telephone number, including area code, of the person to contact in connection with this report.)

Check the appropriate box to indicate the rule pursuant to which this form is being filed, and provide the period to which the information in this form applies:

x Rule 13p-1 under the Securities Exchange Act (17 CFR 240.13p-1) for the reporting period from January 1 to December 31, 2014.

Section 1—Conflict Minerals Disclosure

Item 1.01 Conflict Minerals Disclosure and Report

BIOLASE, Inc. (the “Company”, “we”, or “our”) is a medical device company that develops, manufactures, markets, and sells laser systems in dentistry and medicine and also markets, sells, and distributes dental imaging equipment, including cone beam digital x-rays and CAD/CAM intra-oral scanners, in-office, chair-side milling machines and three dimensional printers. For the year ended December 31, 2014, the Company has determined that certain products it manufactures contain conflict minerals that are necessary to the functionality or production of laser products that it manufactures. As defined in Rule 13p-1 (“Rule 13p-1”) of the Securities Exchange Act of 1934 (the “1934 Act”), conflict minerals include tin, tantalum, tungsten, and gold (“3TG”) regardless of their origin and whether or not they fund armed conflict.

Because the Company uses necessary 3TG in the manufacture of its laser products, management has adopted a Conflict Minerals Policy (“CMP”), which can be found at www.biolase.com under “Investors” in “Corporate Governance.” Accordingly, the Company conducted, in good faith, a Reasonable Country of Origin Inquiry (“RCOI”) for “in scope” suppliers to determine whether the products we manufacture are “conflict free,” that is, that they either do not contain conflict minerals from the Covered Countries (Democratic Republic of the Congo or an adjoining country) or originate from recycled or scrap materials.

For the calendar year ended December 31, 2014, the Company inquired its entire known component and outsourced manufacturing (OEM, ODM, CM) supply chain, which consisted of 137 suppliers, as to whether 3TG was contained in their products. During this inquiry process, the Company identified 34 suppliers who were ultimately within the scope of the RCOI, and requested all 34 suppliers to complete the Conflict-Free Sourcing Initiative (‘CFSI’) Conflict Minerals Reporting Template (the ‘CFSI Template’). Of the suppliers within the scope of the RCOI, the Company performed additional due diligence measures and received 24 responses where the suppliers identified their 3TG as conflict free and six responses where the supplier was uncertain. Two suppliers ceased operations during calendar year 2014 and two suppliers within the scope of the RCOI did not respond.

As a result of its due diligence efforts, the Company was unable to conclude if any of the 3TG contained in its products originated in the Covered Countries for the calendar year ended December 31, 2014 and, as such, has included copy of its Conflict Minerals Report (“CMR”) for the calendar year ended December 31, 2014 filed as Exhibit 1.02 and is incorporated herein by reference. The Company’s CMR was not subject to an independent private sector audit as allowed under Rule 13p-1.

Section 2 – Exhibits

Item 2.01 Exhibits

1.01        Conflict Minerals Report for Biolase, Inc. for the calendar year ended December 31, 2014.

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 thereunto duly authorized.

Date: May 29, 2015

BIOLASE, INC., a Delaware Corporation (registrant)
By:	/s/ DAVID DREYER
	David Dreyer
	Senior Vice President and Chief Financial Officer
	(Principal Financial and Accounting Officer)

EX-1.01

Exhibit 1.01

Conflict Minerals Report of Biolase, Inc.

in Accordance with Rule 13p-1 under the Securities Exchange Act of 1934

This is the Conflict Minerals Report (“CMR”) for Biolase, Inc. (the “Company”) for the calendar year ended December 31, 2014 prepared in accordance with Rule 13p-1 (“Rule 13p-1”) of the Securities Exchange Act of 1934 (the “1934 Act”). Please refer to Rule 13p-1, Form SD, and the 1934 Act Release No. 34-67716; File No. S7-40-10 for definitions to the terms used in this CMR, unless otherwise defined herein.

Rule 13p-1 was adopted by the Securities and Exchange Commission (the “SEC”) to implement reporting and disclosure requirements related to conflict minerals as directed by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”). Rule 13p-1 imposes certain reporting obligations on SEC registrants whose manufactured products contain conflict minerals that are necessary to the functionality or production of their products. For the purposes of this assessment, conflict minerals are defined as tin, tantalum, tungsten, and gold (“3TG”). These requirements apply to registrants whatever the geographic origin of the conflict minerals and whether or not they fund armed conflict.

Because the Company uses necessary 3TG in the manufacture of certain of its laser products, it has conducted a Reasonable Country of Origin Inquiry (“RCOI”). Pursuant to Rule 13p-1, the Company’s RCOI was reasonably designed to determine whether any of the conflict minerals that are not from recycled or scrap sources originated from the Democratic Republic of the Congo (“DRC”) or an adjoining country (collectively the “Covered Countries”) and was performed in good faith. In conducting its due diligence, the Company implemented the 2nd edition of the Organization for Economic Co-operation and Development (“OECD”) Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (“the OECD Guidance”), an internationally recognized due diligence framework. For the purpose of its RCOI, the Company continued to receive supply chain responses through May 27, 2015.

For the calendar year ended December 31, 2014, the Company was unable to determine the country of origin of all of its 3TG from every supplier within the scope of its RCOI and, as such, performed additional due diligence on the sourcing of its 3TG and will annually submit a CMR to the SEC that includes a description of its due diligence measures until it can establish whether all of its 3TG originated from sources other than the Covered Countries or from recycled and scrap sources.

The Company’s CMR for the calendar year ended December 31, 2014 was not subject to a private sector audit.

Company Overview

The Company, incorporated in Delaware in 1987, is a medical device company that develops, manufactures, markets, and sells laser systems in dentistry and medicine and also markets, sells, and distributes dental imaging equipment, including cone beam digital x-rays and CAD/CAM intra-oral scanners, in-office, chair-side milling machines and three dimensional printers. Our products advance the practice of dentistry and medicine for patients and health care professionals.

Products Overview

The Company manufactures and offers two categories of laser system products: WaterLase systems and diode systems. Its flagship product category, the WaterLase system, uses a patented combination of water and laser energy to perform most procedures currently performed using dental drills, scalpels, and other traditional dental instruments for cutting soft and hard tissue. The Company also offers its diode laser systems to perform soft tissue, pain therapy, and cosmetic procedures, including teeth whitening.

Reasonable Country of Origin Inquiry

Because the Company uses necessary 3TG in the manufacture of its laser products, management has conducted a RCOI for “in scope” suppliers to ensure traceability throughout its supply chain in order to establish the origin of 3TG using the Conflict Free Sourcing Initiative (“CFSI”) Conflict Minerals Reporting Template (the “CFSI Template”) developed by countries of the Electronic Industry Citizen Coalition (“EICC”) and the Global e-Sustainability Initiative (“GeSI”). The CFSI Template was developed to facilitate disclosure and communication of information regarding smelters that provide material to a company’s supply chain. It includes questions regarding a company’s conflict-free policy, engagement with its direct suppliers, and a listing of the smelters the company and its suppliers use. In addition, the CFSI Template contains questions about the origin of conflict minerals included in a company’s products, as well as supplier due diligence. Written instructions and recorded training illustrating the use of the CFSI Template is available on CFSI’s website.

The Company’s RCOI was reasonably designed to determine whether any of the conflict minerals that are not from recycled or scrap sources originated from the Covered Countries and was performed in good faith. Requesting that its suppliers complete the CFSI Template regarding information about 3TG smelters and refiners in its supply chain represented the most reasonable effort the Company could make in determining the mines or locations of origin of the 3TG in its supply chain.

As a result of its due diligence efforts, the Company was unable to conclude the extent to which the 3TG contained in its products originated in the Covered Countries or to identify all of the facilities used to process its 3TG for the calendar year ended December 31, 2014.

Due to the breath and complexity of the Company’s products and respective supply chain, it will take time for many of its suppliers to verify the origin of all of the minerals used in the Company’s products. By using its supply chain due diligence processes, driving accountability within the supply chain by leveraging the industry standard CFSI/CFS program, and continuing its outreach efforts, the Company hopes to further develop transparency into its supply chain.

Conflict Minerals Policy

As a result of the Dodd-Frank Act, the Company implemented the following Conflict Minerals Policy (“CMP”) for the calendar year ended December 31, 2014:

As mandated by Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), the Securities and Exchange Commission (the “SEC”) requires publically traded companies to publicly disclose their use of conflict minerals. Pursuant to Section 1502 of the Dodd Frank Act, the term “conflict minerals” includes tin, tantalum, tungsten, and gold (“3TG”) regardless of their origin and whether or not they fund armed conflict. Congress enacted Section 1502 because of concerns that the exploitation and trade of conflict minerals that originate in the Democratic Republic of the Congo (“DRC”) or an adjoining country (together with the DRC, “Covered Countries”) by armed groups is helping to finance conflict in the Covered Countries and is contributing to an emergency humanitarian crisis. As such, SEC registrants have been chartered to practice reasonable due diligence with their supply chain to determine if 3TG used in their products are being sourced from mines controlled by non-government or unlawful military groups within the Covered Countries.

Tracing materials back to their mine of origin is a complex endeavor but an important aspect of responsible sourcing. Biolase, Inc. (the “Company”) looks to industry guidelines to help establish its programs such as the joint Electronic Industry Citizen Coalition (“EICC”) and the Global e-Sustainability Initiative (“GeSI”) which is taking action to address responsible sourcing through the development of the Conflict-Free Smelter (“CFS”) program aiming to enable companies to source conflict-free minerals.

If an SEC registrant can establish that the conflict minerals originated from sources other than the Covered Countries, or from recycled and scrap sources, it must submit a Form SD which describes the Reasonable Country of Origin Inquiry (“RCOI”) that the SEC registrant completed.

If an SEC registrant has reason to believe that any of the conflict minerals in their supply chain may have originated in the Covered Countries, or if they are unable to determine the country of origin of those conflict minerals, then the issuer must exercise due diligence on the conflict minerals’ source and chain of custody. The SEC registrant must annually submit a Conflict Minerals Report (“CMR”) to the SEC that includes a description of those due diligence measures.

The Company’s products include 3TG; however, due to the complexity of the supply chain consisting of mines, traders, exporters, smelters, refiners, alloy producers, recyclers, component manufacturers, and direct suppliers, any of which may change from time to time due to the influence of availability, pricing, or other factors in purchasing decisions, conducting a good faith and reasonable effort to determine the source of these materials to a high degree of certainty presents a significant challenge.

Nonetheless, the Company is committed to developing and implementing a strategy to support the objectives of Section 1502 of the Dodd Frank Act and other regulations on the supply of conflict minerals. The Company’s commitment includes:

● Implementing policies and processes toward preventing the use of conflict minerals or derivative metals necessary to the functionality or production of the Company’s product(s) that finance or benefit armed groups in the Conflict Region.

● Not knowingly procuring 3TG that originate from facilities in the “Conflict Region” that are not certified as conflict free.

● Expecting suppliers whose products contain conflict minerals to establish policies, due diligence frameworks, and management systems consistent with the Organization for Economic Co-operation and Development (“OECD”) Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High Risk-Areas that are designed to accomplish this goal, and requiring their suppliers to do the same.

● Performing a reasonable country of origin inquiry (“RCOI”), including obtaining written documentation or verbal confirmation from suppliers as to whether the 3TG present in products supplied to the Company for its manufactured products originate in the Covered Countries or come from recycled/scrap sources.

● Where 3TG minerals are present and the Company has the reason to believe those minerals originated from the Covered Countries, the Company commits to performing due diligence efforts to determine source of these minerals, including requiring supplier cooperation in due diligence efforts to identify the origin of these minerals.

The Company believes in establishing and maintaining long-term relationships with suppliers whenever possible. However, if the Company determines that any supplier is, or a reasonable risk exists that it may be, violating this policy, then it will require the supplier to commit to devise and undertake suitable corrective action to move to a conflict free source. If suitable action is not taken, the Company will look to alternative sources for the product.

The Company’s efforts are not to ban procurement of minerals from the DRC and adjoining countries, but to assure procurement from responsible sources in the region. If the Company determines that any of the components of its products contain 3TG from a mine or facility that is “non-conflict free,” it will work towards transitioning to products that are “conflict free”.

Supply Chain Overview

In order to manage the scope of this task, the Company relied upon its suppliers to provide information on the origin of the 3TG contained in the components and materials supplied, including sources of 3TG that are supplied to its vendors from sub-tier suppliers. The Company integrated responsible sourcing of minerals requirement with its Conflict Minerals Policy (“CMP”), Supplier Survey/Certification Form, and Supplier Code of Conduct. The Company’s suppliers are expected to provide the 3TG sourcing information pursuant to its CMP, Supplier Survey/Certification Form, and Supplier Code of Conduct. For the calendar year ended December 31, 2014 the Company surveyed all of its “in-scope” suppliers.

Due Diligence Framework

The Company’s due diligence processes and efforts have been developed in conjunction with the OECD Guidance and the related supplements for 3TG. The Company designed its due diligence process, management, and measures to conform in all material respects with the framework OECD Guidance.

The Company’s conflict minerals due diligence process included: the CMP, establishment of governance structures with cross functional team members and senior executives, communication to, and engagement of, suppliers, due diligence compliance process and measurement, record keeping and escalation procedures. Management has also established periodic reporting requirements to the Audit Committee of the Board of Directors with respect to the Company’s 3TG due diligence process and compliance obligations.

Establishment of Company Management Systems

Internal Team

The Company has established a management system for complying with the applicable rules. The management system includes the development of a Conflict Minerals Task Force led by our Senior Vice President and Chief Financial Officer and a team of subject matter experts from relevant functions including, purchasing, quality assurance, manufacturing, and finance.

Supplier Engagement

The Company has established a process to identify suppliers of in-scope products. The Company has inserted a clause on conflict minerals in all new supplier certification forms, as well as revising existing supplier certification forms for in-scope suppliers to include the clause. The clause requires each supplier to use its best endeavors to determine the origin of conflict minerals by using an internationally recognized due diligence framework (the OECD Framework). In addition, identified suppliers of in-scope products are required to complete the Conflict-Free Sourcing Initiative (‘CFSI’) Conflict Minerals Reporting Template (the ‘CFSI Template’) on an annual basis. The CFSI Template was developed to facilitate disclosure and communication of information regarding smelters that provide material to a company’s supply chain. It includes questions regarding a company’s conflict-free policy, engagement with its direct suppliers, and a listing of the smelters the Company and its suppliers use. In addition, the CFSI Template contains questions about the origin of conflict minerals included in suppliers’ products, as well as supplier due diligence. Written instructions and recorded training illustrating the use of the tool is available on CFSI’s website.

Grievance Mechanism

The Company has established a CMP that has been posted on its website at: www.biolase.com under “Investors” in “Corporate Governance.” The Company also has a Supplier Survey/Certification Form and a Supplier Code of Conduct. The Supplier Code of Conduct includes a mechanism for escalating any issues and concerns.

Maintain records

The Company has established its due diligence compliance process and set forth documentation and record maintenance mechanism to ensure the retaining of relevant documentation in a structured electronic database.

The Company has also created internal follow-up processes (including e-mail communication and direct contact by telephone) to identify and escalate any identified issues associated with non-responsive or problematic responses to its RCOI.

Identify and Assess Risk in the Supply Chain

For the calendar year ended December 31, 2014, the Company inquired its entire known component and outsourced manufacturing (OEM, ODM, CM) supply chain, which consisted of 137 suppliers, as to whether 3TG was contained in their products with an 86% response rate. During this inquiry process, the Company identified 34 suppliers who were ultimately within the scope of the RCOI, and requested all 34 suppliers to complete the CFSI Template. Of the suppliers within the scope of the RCOI, the Company received 24 responses that were identified as conflict free using the CFSI Template and six responses where the supplier was uncertain. Two suppliers ceased operations during calendar year 2014 and two suppliers within the scope of the RCOI did not respond.

The Company also compared smelters and refiners identified in supplier responses with the CFSI list of certified Conflict-Free Smelter Program (CFSP) compliant smelters and analyzed supplier responses, followed up with suppliers to assess risk where any ‘red flags’ were raised and compared smelters and refineries identified in supplier responses to the CFSI list of certified CFSP compliant smelters. During its due diligence, the Company gathered 230 smelters and refineries names from its supply chain. Of those, 229 smelters and refineries were identified by CFSI as known smelters and refineries, and one smelter/refinery was not validated or verified. Among these 229 smelters and refineries, 141 are on CFSI’s certified Conflict Free Smelters (“CFS”) list and considered to be conflict free and another 23 have agreed to complete a Conflict Free Smelter Program audit. With respect to the other 65, CFSI has not provided an opinion as whether or not the minerals procured from these smelters and refineries originate from the Covered Countries.

The Company’s conflict minerals task force has developed a process to further evaluate risk in the supply chain. The Company assesses supplier risk by reviewing the suppliers’ responses provided in the CFSI Template for risk indicators. These risk indicators are based on common industry practices. When risk indicators are found, corrective action measures will be required of the supplier(s).

Design and Implement a Strategy to Respond to Risks

The Company has developed a Risk Management Plan, which includes a training program to ensure suppliers understand the Company’s expectations as it relates to 3TG. When applicable, the Company will work with suppliers, if any, who are sourcing from non-Conflict Free smelters to move towards using Conflict Free smelters within a reasonable time frame. The time frame will be dependent on the criticality of the specific part and the availability of alternative suppliers.

Independent Third Party Audit of Supply Chain Due Diligence at Identified Points in the Supply Chain

The Company does not have a direct relationship with 3TG smelters and refiners, nor does it perform direct audits of these entities that provide 3TG. However, the Company does rely upon the industry (for example, EICC and GeSI) efforts to influence smelters and refineries to get audited and certified through CFSI’s CFS program.

Report on Supply Chain Due Diligence

In accordance with the Rule 13p-1 and the OECD Framework, this report is publicly available online at www.biolase.com under “Investors” in “SEC Filings.”