Document:

exhibit10_42-0209.htm

 

 

Exhibit 10.42

RESTRICTED STOCK AGREEMENT

granted pursuant to the

PHOTOMEDEX, INC. 2005 EQUITY COMPENSATION PLAN

THIS RESTRICTED STOCK AGREEMENT (the “Restricted Stock Agreement”) is made and entered into as of June 15, 2009 by and between PhotoMedex, Inc., a Delaware corporation (the “Company”) and the following individual:

Name:  Michael R. Stewart (the “Purchaser”)

Address: 3930 Ruckman Way, Doylestown, PA 18901

Capitalized terms used but not otherwise defined herein shall have the meanings set forth in the PhotoMedex, Inc. 2005 Equity Compensation Plan (the “Plan”). The Purchaser agrees to be bound by the terms and conditions of the Plan, which are incorporated herein by reference and which control in case of any conflict with this
Restricted Stock Agreement, except as otherwise specifically provided in the Plan. The Purchaser has an Employment Agreement, dated September 1, 2007, with the Company.

SECTION 1  ACQUISITION OF SHARES.

(a)           Issuance. On the terms and conditions set forth in this Restricted Stock Agreement, the Company agrees to issue Ten Thousand Five Hundred (10,500) shares to
the Purchaser. The issuance shall occur at the offices of the Company on the date set forth above or at such other place and time (but not in a calendar year other than the current calendar year) as the parties may agree.

 

(b)           Consideration. The Purchaser agrees to pay to the Company the sum of $.01 (the “Per Share Purchase Price”) for each of such Shares, representing
the par value thereof. Payment shall be made on the issuance date by delivery to the Company of the Purchaser's check in the amount of the aggregate purchase price.

 

(c)           Defined Terms. Certain capitalized terms are defined in Sections 2 and 3 of this Restricted Stock Agreement.

 

SECTION 2  RIGHT OF REPURCHASE.

 

(a)           Scope of Repurchase Right. Until they vest in accordance with Section (b) below, the Purchased Shares shall be Restricted Shares and shall be subject to the
Right of Repurchase. The Company may exercise its Right of Repurchase only during the earlier to occur of: (i) the Repurchase Period following the termination of the Purchaser’s Service, or (ii) the Repurchase Period following the failure of the Restricted Shares to vest as of December 31, 2010. The Right of Repurchase may be exercised automatically under Section 2(d) below.

 

·  

 

(b)           Lapse of Repurchase Right.

 

(i)           Except as otherwise provided in Section 2(b)(ii), the Right of Repurchase shall lapse with respect to all Restricted Shares, and the Purchaser’s rights in such Shares shall be vested, if the Company has  adjusted
net income (“2010 Adjusted Net Income”) equal to or greater than zero for the Company’s fiscal year ended December 31, 2010. For purposes of this Section 2(b)(i), the 2010 Adjusted Net Income shall be “net income after income taxes”, based on the audited financial statements of PhotoMedex, Inc. and Subsidiaries for the year ended December 31, 2010, excluding income or expense, on a post-tax basis, from stock options or warrants on the Company stock. In the event that the Company
does not achieve 2010 Adjusted Net Income, then the Company shall have until June 30, 2011, to repurchase the restricted shares.

(ii)           Notwithstanding Section 2(b)(i), the Restricted Shares may vest, and the Right of Repurchase may lapse, sooner under Sections 6(c)(6) and 10(a) of the Purchaser’s Employment Agreement with the Company.

(c)           Escrow. Upon issuance, the certificate(s) for Purchased Shares shall be deposited in escrow with the Company to be held in accordance with the provisions of
this Restricted Stock Agreement. Any additional or exchanged securities or other property described in Section 2(f) below shall be delivered to the Company to be held in escrow. All ordinary cash dividends on Purchased Shares (or on other securities held in escrow) shall be paid directly to the Purchaser and shall not be held in escrow. Purchased Shares, together with any other assets held in escrow under this Restricted Stock Agreement, shall be (i) surrendered to the Company for repurchase upon exercise of
the Right of Repurchase or (ii) released to the Purchaser upon his or her request to the extent that the Purchased Shares have ceased to be Restricted Shares (but not more frequently than once every six months). In any event, all Purchased Shares that have ceased to be Restricted Shares, together with any other vested assets held in escrow under this Restricted Stock Agreement, shall be released within 90 days after the termination of the Purchaser's Service.

 

(d)           Exercise of Repurchase Right. The Company shall be deemed to have exercised its Right of Repurchase automatically for all Restricted Shares as of the commencement
of the Repurchase Period, unless the Company during the Repurchase Period notifies the holder of the Restricted Shares pursuant to Section 9 that it will not exercise its Right of Repurchase for some or all

  

  

  

of the Restricted Shares. During the Repurchase Period, the Company shall pay to the holder of the Restricted Shares the purchase price determined under Section 2(a) above for the Restricted Shares being repurchased ( i.e. , $.01 per Share, as adjusted for stock splits, stock dividends
and similar corporate transactions). Payment shall be made in cash or cash equivalents and/or by canceling indebtedness to the Company incurred by the Purchaser. The certificate(s) representing the Restricted Shares being repurchased shall be delivered to the Company (if not already held by the Company).

 

(e)           Termination of Rights as Stockholder. If the Right of Repurchase is exercised in accordance with this Section 2 and the Company makes available the consideration
for the Restricted Shares being repurchased, then the person from whom the Restricted Shares are repurchased shall no longer have any rights as a holder of the Restricted Shares (other than the right to receive payment of such consideration). Such Restricted Shares shall be deemed to have been repurchased pursuant to this Section 2 whether or not the certificate(s) for such Restricted Shares have been delivered to the Company or the consideration for such Restricted Shares has been accepted.

(f)           Additional or Exchanged Securities and Property. In the event of a merger or consolidation of the Company with or into another entity (other than a Change in
Control Event), any other corporate reorganization (other than a Change in Control Event), a stock split, the declaration of a stock dividend, the declaration of an extraordinary dividend payable in a form other than stock, a spin-off, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting the Company's outstanding securities, any securities or other property (including cash or cash equivalents) that are by reason of such transaction exchanged for, or distributed with respect
to, any Restricted Shares shall continue to be subject to the Right of Repurchase. Appropriate adjustments to reflect the exchange or distribution of such securities or property shall be made to the number and/or class of the Restricted Shares and to all of the provisions of this Section 2, including the price per share to be paid upon the exercise of the Right of Repurchase, provided that the aggregate purchase price payable for the Restricted Shares shall remain the same. In the event of a merger or consolidation
of the Company with or into another entity or any other corporate reorganization that does not constitute a Change in Control Event, the Right of Repurchase may be exercised by the Company's successor.

 

(g)           Transfer of Restricted Shares. The Purchaser shall not transfer, assign, encumber or otherwise dispose of any Restricted Shares without the Company's written
consent (which consent may be withheld with or without any reason therefor), except as provided in the following sentence. The Purchaser may transfer Restricted Shares to one or more members of the Purchaser's Immediate Family or to a trust or partnership established by the Purchaser for the benefit of the Purchaser and/or one or more members of the Purchaser's Immediate Family, provided in either case that the Transferee agrees in writing on a form prescribed by the Company to be bound by all provisions of this
Restricted Stock Agreement. If the Purchaser transfers any Restricted Shares, then this Restricted Stock Agreement shall apply to the Transferee to the same extent as to the Purchaser.

 

(h)           Assignment of Repurchase Right. The Board of Directors may freely assign the Company's Right of Repurchase, in whole or in part. Any person who accepts an assignment
of the Right of Repurchase from the Company shall assume all of the Company's rights and obligations under this Section 2.

 

(i)           Part-Time Employment and Leaves of Absence. If the Purchaser commences working on a part-time basis, then the Company may adjust the vesting schedule set forth
in Section 2(b) above in accordance with the Company's part-time work policy or the terms of an agreement between the Purchaser and the Company pertaining to his or her part-time schedule. If the Purchaser goes on a leave of absence, then the Company may adjust the vesting schedule set forth in Section 2(b) above in accordance with the Company's leave of absence policy or the terms of such leave. Except as provided in the preceding sentence, Service shall be deemed to continue while the Purchaser is on a  bona
fide  leave of absence, if (i) such leave was approved by the Company in writing and (ii) continued crediting of Service is expressly required by the terms of such leave or by applicable law (as determined by the Company). Service shall be deemed to terminate when such leave ends, unless the Purchaser immediately returns to active work.

SECTION 3  OTHER DEFINITIONS.

“Immediate Family” shall mean any child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law and shall include adoptive relationships.

“Purchased Shares” shall mean the Shares purchased by the Purchaser pursuant to this Restricted Stock Agreement.

“Repurchase Period” shall mean a period of 180 consecutive days commencing on the earlier to occur of: (i) the date when the Purchaser's Service terminates for any reason, including (without limitation) death or disability; or (ii) the last date when the Restricted Shares
might vest (viz. December 31, 2010), but in fact do not vest at that time. 

 “Restricted Share” shall mean a Purchased Share that is subject to the Right of Repurchase.

“Right of Repurchase” shall mean the Company's right of repurchase described in Section 2.

“Securities Act” shall mean the Securities Act of 1933, as amended.

 

“Service” shall mean service to the Company or its subsidiaries as an Employee or, following a Change in Control Event, service to the New Employer (as defined in Section 2(b)) or its subsidiaries as an employee.

  

  

  

“Share” shall mean one share of Stock

“Stock” shall mean the Common Stock of the Company, par value $0.01 per Share.

“Transferee” shall mean any person to whom the Purchaser directly or indirectly transfers any Purchased Shares.

SECTION 4  OTHER RESTRICTIONS ON TRANSFER.

 

(a)           Purchaser Representations. In connection with the issuance and acquisition of Shares under this Restricted Stock Agreement, the Purchaser hereby represents
and warrants to the Company as follows:

 

(i)           The Purchaser has received a copy of an offering memorandum relating to the sale of the Purchased Shares to the Purchaser hereunder.

(ii)           The Purchaser acknowledges his or her understanding that if he or she is an “affiliate” of the Company, the Purchaser's right to resell the Purchased Shares after the Company's Right of Repurchase lapses is restricted under the Securities Act.

 

(iii)           The Purchaser will not sell, transfer or otherwise dispose of the Purchased Shares in violation of the Securities Act or the rules promulgated thereunder, including Rule 144 under the Securities Act. The Purchaser agrees that he or she will not dispose of the Purchased
Shares unless and until he or she has complied with all requirements of this Restricted Stock Agreement applicable to the disposition of Purchased Shares and he or she has provided the Company with written assurances, in substance and form reasonably satisfactory to the Company, that (A) the proposed disposition does not require registration of the Purchased Shares under the Securities Act or all appropriate action necessary for compliance with the registration requirements of the Securities Act or with any exemption
from registration available under the Securities Act (including Rule 144) has been taken and (B) the proposed disposition will not result in the contravention of any transfer restrictions applicable to the Purchased Shares under state securities law.

 

(b)           Securities Law Restrictions. Regardless of whether the offering and sale of Shares under this Restricted Stock Agreement have been registered under the Securities
Act or have been registered or qualified under the securities laws of any state, the Company at its discretion may impose restrictions upon the sale, pledge or other transfer of the Purchased Shares (including the placement of appropriate legends on stock certificates or the imposition of stop-transfer instructions) if, in the judgment of the Company, such restrictions are necessary or desirable in order to achieve compliance with the Securities Act, the securities laws of any state or any other law.

 

(c)           Rights of the Company. The Company shall not be required to (i) transfer on its books any Purchased Shares that have been sold or transferred in contravention
of this Restricted Stock Agreement or (ii) treat as the owner of Purchased Shares, or otherwise to accord voting, dividend or liquidation rights to, any transferee to whom Purchased Shares have been transferred in contravention of this Restricted Stock Agreement.

 

SECTION 5  SUCCESSORS AND ASSIGNS.

Except as otherwise expressly provided to the contrary, the provisions of this Restricted Stock Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and shall be binding upon the Purchaser and the Purchaser's legal representatives, heirs, legatees, distributees, assigns and transferees
by operation of law, whether or not any such person has become a party to this Restricted Stock Agreement or has agreed in writing to join herein and to be bound by the terms, conditions and restrictions hereof.

SECTION 6  NO RETENTION RIGHTS.

Nothing in this Restricted Stock Agreement shall confer upon the Purchaser any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining the Purchaser) or of the Purchaser, which rights are hereby expressly
reserved by each, to terminate his or her Service at any time and for any reason, with or without cause.

SECTION 7  TAX ELECTION.

The acquisition of the Purchased Shares may result in adverse tax consequences that may be avoided or mitigated by filing an election under Code Section 83(b). Such election may be filed only within 30 days after the date of purchase.  The Purchaser should consult with his or her
tax advisor to determine the tax consequences of acquiring the Purchased Shares and the advantages and disadvantages of filing the Code Section 83(b) election. The Purchaser acknowledges that it is his or her sole responsibility, and not the Company's responsibility, to file a timely election under Code Section 83(b), even if the Purchaser requests the Company or its representatives to make this filing on his or her behalf.   CIRCULAR
230 DISCLAIMER: Nothing contained herein concerning certain federal income tax considerations is intended or written to be used, and cannot be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transactions or tax-related matters addressed herein.

  

  

  

SECTION 8  LEGENDS.

All certificates evidencing Purchased Shares shall bear the following legend:

“THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE TERMS OF A WRITTEN AGREEMENT BETWEEN THE ISSUER OF SUCH SHARES AND THE REGISTERED HOLDER OF SUCH SHARES (OR THE PREDECESSOR IN INTEREST TO SUCH HOLDER OF SHARES). SUCH AGREEMENT
GRANTS TO SUCH ISSUER CERTAIN REPURCHASE RIGHTS UPON TERMINATION OF SERVICE WITH THE COMPANY. THE SECRETARY OF SUCH ISSUER WILL UPON WRITTEN REQUEST FURNISH A COPY OF SUCH AGREEMENT TO THE HOLDER HEREOF WITHOUT CHARGE.”

 

 

If required by the authorities of any state in connection with the issuance of the Purchased Shares, the legend or legends required by such state authorities shall also be endorsed on all such certificates. 

SECTION 9  NOTICE.

 

Any notice required by the terms of this Restricted Stock Agreement shall be given in writing and shall be deemed effective upon (i) personal delivery, (ii) deposit with the United States Postal Service, by registered or certified mail, with postage and fees prepaid or (iii) deposit with a recognized overnight courier service, with shipping
charges prepaid. Notice shall be addressed to the Company at its principal executive office and to the Purchaser at the address that he or she most recently provided to the Company in accordance with this Section 9.

 

SECTION 10  ENTIRE AGREEMENT.

 

This Restricted Stock Agreement, together with the Plan and the Purchaser’s Employment Agreement with the Company, constitutes the entire contract between the parties hereto with regard to the subject matter hereof and supersedes any other agreements, representations or understandings (whether oral or written and whether express
or implied) which relate to the subject matter hereof.

 

SECTION 11  CONFLICITS OF LAW.

 

This Restricted Stock Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without regard to conflict of laws principles.

 

IN WITNESS WHEREOF, each of the parties has executed this Restricted Stock Agreement, in the case of the Company by its duly authorized officer, as of the day and year first above written.

 

	
 
	
PURCHASER:
	  	
PHOTOMEDEX, INC.
	  
	
 
	
 
	
 
	
 
	  
	
 
	  	
 
	
 
	  
	
 
	
 /s/ Michael R. Stewart
	  	
By:  /s/ Richard J. DePiano
	  
	
 
	
Name: Michael R. Stewart

 
	
 
	
Name: Richard J. DePiano

Title: Chairman of the Board of Directorsexhibit10_43-0209.htm

EXHIBIT 10.43

Adopted by action of the Board of Directors: June 30, 2005; amended as of June 30, 2009.

PHOTOMEDEX, INC.

 

CODE OF ETHICS

 

ON INTERACTIONS WITH HEALTH CARE PROFESSIONALS

 

Adopted:                    June 30, 2005 Revised:June 30, 2009

 

Goal and Scope of Code

 

PhotoMedex is a medical device and pharmaceutical company focused on facilitating the cost-effective use of technologies for doctors, hospitals, surgery centers and patients or consumers. Our business has five general categories, or segments, of business activity. We are engaged in the business of marketing the XTRAC® laser system,
a 308 nanometer (nm) excimer laser for dermatology (the "XTRAC") through a domestic segment and through an international segment. We also market skin-care products on a prescription basis and over-the-counter basis, as applicable, as well as products that are cosmetic and not sold by prescription or over-the-counter. In addition, we market dermatological products based on light-emitting diodes domestically and internationally; domestic marketing is directed to professional and non-professional users as well as
to consumers for home use. We are also engaged in the business of marketing surgical products using a variety of lasers and related products over a range of specialties. We are committed to adhere to ethical and legal standards in our relationship with Health Care Professionals (defined below). This Code of Ethics (the "Code") is intended to govern our interactions with Health Care Professionals.

 

The term Health Care Professionals, as used herein, includes all individuals and entities involved in the product purchase decision, including persons licensed by state law to prescribe drugs or medical treatments for patients, medical students, members of a drug formulary committee, office and hospital staff, governmental agencies and
group purchasing entities. All references to "Company," "we," "us" or "our" refer to PhotoMedex and PhotoMedex encompasses its subsidiaries, including without limitation ProCyte Corporation, Photo Therapeutics Ltd. and Photo Therapeutics, Inc. All references to "Employees," "you" or "your" refer to PhotoMedex's officers, directors, employees and consultants.

 

Our interactions with Health Care Professionals cover a range of activities, including:

 

	
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Promotional Activities. We promote the sale and use of our device and drug products to Health Care Professionals directly and indirectly through representatives and distributors. We also promote through print advertisements, direct mail and other media, such as the internet.

 

	
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Training and Product Related Education. We offer instruction, education, training, service and technical support to Health Care Professionals to ensure the safe and effective use of our device and drug products.

 

	
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Research and Education. We support bona fide medical research and continuing medical education for Health Care Professionals to increase access to new technology and enhance the delivery of safe, efficacious and cost-effective health care.

 

	
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Advancement of Medical Technology. We collaborate with Health Care Professionals to demonstrate the effectiveness of our device and drug products, to improve the utility and applications of our products and to create new products.

  

  

  

 

Our reputation for honesty, integrity and fair dealing with our customers, others we do business with, our Employees and the communities we serve is our most important asset. Accordingly, we require that you act in a manner consistent with the letter and intent of this Code and the policies underlying it. While the Code addresses many
of the interactions we have with Health Care Professionals, it is impossible to provide specific guidance for every situation. Matters not specifically addressed in the Code, should be addressed in light of the following principle:

 

PhotoMedex insists on ethical business practices and socially responsible conduct and shall not use any unlawful inducement in order to sell, recommend or arrange for the sale or use of its products or services. Our failure to adhere to this Code could subject us to severe penalties, including disqualification of the Company as a vendor,
civil fines and injunctions and criminal prosecution, fines and imprisonment.

 

Each of you is expected to become familiar with these policies and to affirm your agreement to comply with these policies by signing the Compliance Certificate that appears at the end of the Code. Any questions regarding the Code or matters not covered by the Code should be referred to your immediate supervisor, Compliance Officer or the
Audit Committee of the Board (the "Audit Committee").

 

Promotional Activities

 

We interact with Health Care Professionals to discuss product features, contract negotiations, and sales terms, both in the Health Care Professionals' offices and at meetings and conferences.

 

	
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Gifts. As of July 1, 2009, we may no longer provide modest gifts to Health Care Professionals, other than those which serve a genuine educational function such as medical textbooks or anatomical models used for educational purposes.  Such gifts may not have a fair market value exceeding
$100 and should have no independent value to the Health Care Professionals aside from their educational value.  Under no circumstances may such gifts be given in the form of cash or cash equivalents.

 

	
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Hospitality. We may pay for occasional hospitality only in the following circumstances: (i) where our sales representatives or their managers offer meals to be consumed in-office or in-hospital during the presentation of an informational program on our products, and the meal is modest by local standards;
such meals may not be offered at restaurants, nor in ‘dine-and-dash’ or takeout formats; (ii) where our executives offer a modest meal outside the office or hospital but in a venue that is conducive to the exchange of information; and (iii) at speaker training programs and speaker programs, where a modest meal may be offered to attendees in a setting conducive to informational communication. It is not appropriate to pay for meals of guests of Health Care Professionals or any other person who does
not have a bona fide professional interest in the information being shared at the meeting.

 

	
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Promotional Items. We may no longer provide Health Care Professionals with items of minimal value that are related to the Health Care Professional's work but that are unrelated to educating the patient in disease states or treatments.   Such items include, but are not limited to, pens,
prescription pads, mugs or sports bottles, etc.

 

 

	
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Caps on Speaker Payments.  Under the revised policy, we must limit the amount we pay any one speaker in a given year.  We have therefore capped this amount at $40,000, subject to adjustment only by the Audit Committee.

 

· Samples; Information. We may provide appropriate samples or information to illustrate the benefits of our products and services, or opportunities for evaluation
of our products and services.  Such materials must be accurate and not misleading, make only substantiated claims, reflect the balance between risks and rewards and be consistent with all FDA requirements.

  

  

  

 Under our former policy, the total value of gifts, promotional materials or any other items or activities that we provided to a Health Care Professional was not to exceed $1,500 per calendar year. Under the current policy due to changes under the Pharma Code, there is no overall cap; gifts, meals, promotional items
are either prohibited or

limited to modest values and resorted to occasionally. However, the current limitations still do not apply to financial support for continuing medical education forums, including Company training events, financial support for health educational scholarships, or samples or information given to physicians and other Health Care Professionals
intended for free distribution to patients.  Neither does this total include benefits exempt under the anti-kickback laws (e.g. product discounts) or payments to consultants or investigators, provided such payments do not exceed the fair market value of the services rendered.

	
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Off-label uses. We may not promote our products in the U.S. for uses that are not cleared or approved by the Food and Drug Administration. Such uses are called “off-label” uses. Health Care Professionals may be permitted, under the ethics of their professions, to use our products for
uses that are “off-label”, and we in fact may be permitted under the health-care laws of other countries, to promote such uses in countries other than the U.S., depending on the laws of such countries. But neither of these considerations alters the fact that we are not permitted under FDA regulations to promote our products for off-label uses in the U.S.

We are permitted in the U.S. to respond to the request of a Health Care Professional for information about an off-label use. Any such response must be guided by three caveats:   (i) we must avoid the fact and appearance of inducing such requests; (ii) we must not convert such a request into an opportunity for promoting an
off-label use; and (iii) we must confine our response to information within our sphere of competence. We are not competent in matters calling for a physician’s training, nor are we competent to advise on claims for Medicare or Medicaid reimbursement for the off-label use of a product.

We are permitted, at our own initiative or in response to a request for clinical information on an off-label use, to provide peer-reviewed professional articles on the off-label use. FDA guidelines stipulate that we must clearly mark any such article as describing an unapproved or uncleared use, and we must disclose any known relationship
between the authors of the article and the manufacturers of the device or drug that might give rise to a conflict of interest. Consistent with the three caveats listed above, however, sales personnel should refer a physician’s request for information on off-label uses to the Clinical Liaison (presently Al Intintoli) at corporate headquarters, and the Liaison can direct distributing such professional articles or putting the physician in contact with our clinical specialists knowledgeable in such uses or
with physician-users on a reference list.

 

Product Training and Education

 

We may sponsor programs focused on education and training in the safe and effective use of our products and services.

 

	
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Location. Programs should be conducted in clinical, educational, conference or other setting, including hotel or other commercially available meeting facilities, that are conducive to the effective transmission of knowledge. Such venues shall not be located in a ‘resort’ or other entertainment-based
facility. Programs requiring "hands-on" training in medical procedures should be held at training facilities, medical institutions, laboratories, or other appropriate facilities.

 

	
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Training Staff The training staff should have the proper qualifications and expertise to conduct such training.

  

  

  

 

	
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Hospitality. We may provide Health Care Professional attendees with hospitality in the form of meals and/or receptions in connection with these programs. Such hospitality shall be in a venue conducive to informational communication.

 

	
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Travel and Lodging. We may no longer pay for reasonable travel and modest lodging costs incurred by attending Health Care Professionals who are not engaged by us as speakers.

 

	
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Guests. It is not appropriate for us to pay for the meals, hospitality, travel, or other expenses for guest of Health Care Professionals or for any other person who does not have a bona fide professional interest in the information being shared at the meeting.

 

Third-Party Educational Conferences

 

We may support independent, educational or scientific conferences to promote scientific knowledge, medical advancement and the delivery of effective health care. These typically include conferences sponsored by national, regional or specialty medical associations, conferences sponsored by accredited continuing medical education providers
and grand rounds.

 

	
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Educational Grants. We may provide educational grants when: (1) the gathering is primarily dedicated to promoting objective scientific and educational activities and discourse; and (2) the training institution or the conference sponsor selects the attending Health Care Professionals who are in training.
Such grants should be paid only to organizations with a genuine educational purpose or function, and may be used only to reimburse the legitimate expenses for bona fide educational activities. Such grants also should be consistent with relevant guidelines established by professional societies or organizations. The conference sponsor should be responsible for and control the selection of program content, faculty, educational methods and materials, and we shall not participate in or advise on this process even
if we are requested to do so. We may provide grants either directly to the conference sponsor or to a training institution to reduce conference costs, or to allow attendance by medical students, residents, fellows and others who are Health Care Professionals in training.

 

	
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Meals and Hospitality. We may provide funding to the conference sponsor to support the conference's meals and hospitality. We may not, however, provide meals and receptions for all Health Care Professional attendees, although we may make a donation to the sponsor to offset the cost of such meals
and receptions for all attendees.

 

 

	
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Faculty Expenses. We may make grants to conference sponsors for reasonable honoraria, travel, lodging and meals for Health Care Professionals who are bona fide conference faculty members.

 

 

Arrangements with Consultants, Clinical Investigators

 

We may engage Health Care Professionals to serve as consultants (including as clinical investigators) to provide valuable bona fide consulting services, including research, participation on an advisory board, presentations at our training or other professional meetings, and product collaboration. It is appropriate to pay Health Care Professionals
reasonable compensation for performing these services.

 

	
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Need and Qualification. Consulting agreements may be entered into only where a legitimate need and purpose for the services is identified in advance. Selection of consultants should be on the basis of the consultant's qualifications and expertise to address the identified purpose, and may not be
on the basis of the past or potential volume or value of business generated by the consultant.

 

	
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Written Agreement and Protocol. All consulting arrangements must be written, signed by the parties and must specify all services to be provided. Where research services are provided, the agreement must contain a statement of work or research protocol. All agreements must be signed by our Chief Executive
Officer or Chief Financial Officer, or another officer specifically designated by them.

 

  

  

  

 

 

	
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Compensation. Compensation paid to consultants must be consistent with the fair market value for the services provided.

 

	
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Meetings. The venue and circumstances for meetings with consultants should be appropriate to the subject matter of the consultation. These meetings should be conducted in clinical, educational, conference, or other setting, including hotel or other commercially available meeting facilities, conducive
to the effective exchange of information.  Such venues shall not be located in a ‘resort’ or other entertainment-based facility.

 

	
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Hospitality. Hospitality that occurs in conjunction with a consultant meeting or consultant's services should be modest in value and should be subordinate in time and focus to the primary purpose of the meeting or services.

 

	
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Travel and Lodging. We may pay for reasonable and actual expenses incurred by consultants in carrying out the subject of the consulting arrangement, including reasonable and actual travel, modest meals and lodging costs incurred by consultants attending meetings with us or on our behalf.

 

	
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FDA and other Regulatory Restrictions for Clinical Investigators. Our relationships with clinical investigators in trials to be submitted to the FDA or other regulatory agencies are governed by conflict of interest, disclosure and other rules. Nothing in the Code is intended to supersede or modify
our strict compliance with such regulations.

 

Provision of Reimbursement and Other Economic Information

 

We support accurate and responsible billing to Medicare and other payors. We may assist Health Care Professionals by providing reimbursement information regarding our products, including identifying or justifying appropriate coverage, coding, or billing of products, or of procedures using those products, or other economic information about
our products and services. However, this is only acceptable if (a) the information provided is accurate and (b) the information is of a general nature and of insubstantial fair market value such that our assistance does not supplant the judgment and responsibility of the Health Care Professional. However, we are not to advise on such matters in respect of uses of a drug or device that is considered an off-label use.

 

Grants and Other Charitable Donations

 

We may make donations for a charitable purpose, such as supporting genuine independent medical research for the advancement of medical science or education, indigent care, patient education, public education or the sponsorship of events where proceeds are intended for charitable purposes. We may not make such donations for the purpose
of unlawfully inducing Health Care Professionals to purchase, recommend, use, or arrange for the purchase or use of our products.

 

	
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Recipients. Donations should be made only to charitable organizations or in rare instances, to individuals engaged in genuine charitable missions for the support of that mission.

 

	
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Advancement of Medical Education. We may make grants to support the genuine medical education of medical students, residents, and fellows participating in fellowship programs, which are charitable or have an academic affiliation or, where consistent with the preamble to this section, other medical
personnel.

 

	
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Support of Research with Scientific Merit. We may make research grants to support genuine medical research. The purpose of the grant must be clearly documented.

 

	
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Public Education. We may make grants for the purpose of supporting education of patients or the public about important health care topics.

 

	
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Authorization. Any request for charitable donations must be made to and approved by the Compliance Officer.

 

International Interactions with Health Care Professionals

 

We recognize that customs, practices, laws and regulations vary throughout the world. However, it is our intent that the underlying purposes of the Code, to ensure ethical and legal relationships with Health Care Professionals, are equally applicable inside and outside the United States. Interactions that may be customary and not illegal
in a particular country may still be unlawful under U.S. law and subject PhotoMedex and the persons involved to criminal liability.

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