Palomar Revenues Increase by 53 Percent; Operating Income More than Triples
The Company and Lumenis Ltd. reached a settlement resolving their on-
going litigation concerning both patent infringement and contractual
matters. Under the terms of the settlement, Lumenis paid $868,000 in
the second quarter for sales of the LightSheer made prior to July 1,
2002 and agreed to pay $3.225 million over the next six quarters, or
$537,500 per quarter, for royalties due on sales of the LightSheer
made between July 1, 2002 and December 31, 2003. Beginning on January
1, 2004, Lumenis agreed to pay Palomar a 5% royalty on sales of the
LightSheer and other professional laser hair removal devices and
modules. Lumenis made their first payment of $457,000 in the second
quarter for sales made in the first quarter. In addition, Lumenis
granted Palomar a paid up license to a variety of Lumenis’ patents for
Palomar’s light based devices. Palomar granted Lumenis a paid up
license to the '568 and ‘844 patents for Lumenis’ lamp based devices.
Both parties have agreed to the validity and enforceability of each
others patents and not to challenge such validity and enforceability
in the future.