THE SECURITIES
REPRESENTED HEREBY MAY NOT BE TRANSFERRED UNLESS (I) SUCH
SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES
ACT OF 1933, AS AMENDED, (II) SUCH SECURITIES MAY BE SOLD
PURSUANT TO RULE 144, OR (III) THE COMPANY HAS RECEIVED AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER
MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES
LAWS.
SUBJECT TO THE
PROVISIONS OF SECTION 10 HEREOF, THIS WARRANT SHALL BE VOID AFTER
5:00 P.M. EASTERN TIME ON AUGUST 24, 2013 (the “EXPIRATION
DATE”).
WARRANT TO PURCHASE 3,378,379
SHARES OF
COMMON STOCK, PAR VALUE $0.001 PER SHARE
For VALUE
RECEIVED, Den-Mat Holdings, LLC (the “Warrantholder”),
is entitled to purchase, subject to the provisions of this Warrant,
from Remedent, Inc., a Nevada corporation (the
“Company”), at any time not later than 5:00 P.M.,
Eastern time, on the Expiration Date (as defined above), at an
exercise price per share equal to $1.48 (the exercise price in
effect being herein called the “Warrant Price”),
3,378,379 shares (the “Warrant Shares”) of the
Company’s Common Stock, par value $0.001 per share (the
“Common Stock”). The number of Warrant Shares
purchasable upon exercise of this Warrant and the Warrant Price
shall be subject to adjustment from time to time as described
herein.
Section 1.
Registration . The Company shall maintain books for the
transfer and registration of the Warrant. Upon the initial issuance
of this Warrant, the Company shall issue and register the Warrant
in the name of the Warrantholder.
Section 2.
Transfers . As provided herein, this Warrant may be
transferred only pursuant to a registration statement filed under
the Securities Act of 1933, as amended (the “Securities
Act”) and the applicable state securities laws or an
exemption from such registrations. Subject to such restrictions,
the Company shall transfer this Warrant from time to time upon the
books to be maintained by the Company for that purpose, upon
surrender hereof for transfer properly endorsed or accompanied by
appropriate instructions for transfer and such other documents as
may be reasonably required by the Company, including, if required
by the Company, an opinion of its counsel to the effect that such
transfer is exempt from the registration requirements of the
Securities Act, to establish that such transfer is being made in
accordance with the terms hereof, and a new Warrant shall be issued
to the transferee and the surrendered Warrant shall be canceled by
the Company.
Section 3.
Exercise of Warrant . Subject to the provisions hereof, the
Warrantholder may exercise this Warrant in whole or in part at any
time prior to its expiration upon surrender of this Warrant,
together with delivery of the duly executed Warrant exercise form
attached hereto as Appendix A (the “Exercise
Agreement”) and payment by cash, certified check or wire
transfer of funds (or, in certain circumstances, by cash-less
exercise as provided below) for the aggregate Warrant Price for
that number of Warrant Shares then being purchased, to the Company
during normal business hours on any business day at the
Company’s principal executive offices (or such other office
or agency of the Company as it may designate by notice to the
Warrantholder). The Warrant Shares so purchased shall be deemed to
be issued to the Warrantholder or the Warrantholder’s
designee, as the record owner of such shares, as of the close of
business on the date on which this Warrant shall have been
surrendered (or evidence of loss, theft
or destruction
thereof and security or indemnity satisfactory to the Company), the
Warrant Price shall have been paid and the completed Exercise
Agreement shall have been delivered. Certificates for the Warrant
Shares so purchased, representing the aggregate number of shares
specified in the Exercise Agreement, shall be delivered to the
Warrantholder within a reasonable time, not exceeding three
(3) business days, after this Warrant shall have been so
exercised. The certificates so delivered shall be in such
denominations as may be requested by the Warrantholder and shall be
registered in the name of the Warrantholder or such other name as
shall be designated by the Warrantholder. If this Warrant shall
have been exercised only in part, then, unless this Warrant has
expired, the Company shall, at its expense, at the time of delivery
of such certificates, deliver to the Warrantholder a new Warrant
representing the number of shares with respect to which this
Warrant shall not then have been exercised. As used herein,
“business day” means a day, other than a Saturday or
Sunday, on which banks in New York City are open for the general
transaction of business.
If (1) a
certificate representing the Warrant Shares is not delivered to the
Warrantholder within three (3) Business Days of the due
exercise of this Warrant by the Warrantholder and (2) prior to the
time such certificate is received by the Warrantholder, the
Warrantholder, or any third party on behalf of the Warrantholder or
for the Warrantholder’s account, purchases (in an open market
transaction or otherwise) shares of Common Stock to deliver in
satisfaction of a sale by the Warrantholder of shares represented
by such certificate (a “Buy-In”), then the Company
shall pay in cash to the Warrantholder (for costs incurred either
directly by such Warrantholder or on behalf of a third party) the
amount by which the total purchase price paid for Common Stock as a
result of the Buy-In (including brokerage commissions, if any)
exceeds the proceeds received by such Warrantholder as a result of
the sale to which such Buy-In relates. The Warrantholder shall
provide the Company written notice indicating the amounts payable
to the Warrantholder in respect of the Buy-In.
Section 4.
Compliance with the Securities Act of 1933 . The Company may
cause the legend set forth on the first page of this Warrant to be
set forth on each Warrant or similar legend on any security issued
or issuable upon exercise of this Warrant, unless counsel for the
Company is of the opinion as to any such security that such legend
is unnecessary.
Section 5.
Payment of Taxes . The Company will pay any documentary
stamp taxes attributable to the initial issuance of Warrant Shares
issuable upon the exercise of the Warrant; provided ,
however , that the Company shall not be required to pay any
tax or taxes which may be payable in respect of any transfer
involved in the issuance or delivery of any certificates for
Warrant Shares in a name other than that of the Warrantholder in
respect of which such shares are issued, and in such case, the
Company shall not be required to issue or deliver any certificate
for Warrant Shares or any Warrant until the person requesting the
same has paid to the Company the amount of such tax or has
established to the Company’s reasonable satisfaction that
such tax has been paid. The Warrantholder shall be responsible for
income taxes due under federal, state or other law, if any such tax
is due.
Section 6.
Mutilated or Missing Warrants . In case this Warrant shall
be mutilated, lost, stolen, or destroyed, the Company shall issue
in exchange and substitution of and upon cancellation of the
mutilated Warrant, or in lieu of and substitution for the Warrant
lost, stolen or destroyed, a new Warrant of like tenor and for the
purchase of a like number of Warrant Shares, but only upon receipt
of evidence reasonably satisfactory to the Company of such loss,
theft or destruction of the Warrant, and with respect to a lost,
stolen or destroyed Warrant, reasonable indemnity or bond with
respect thereto, if requested by the Company.
Section 7.
Reservation of Common Stock . The Company hereby represents
and warrants that there have been reserved, and the Company shall
at all applicable times keep reserved until issued (if necessary)
as contemplated by this Section 7, out of the authorized and
unissued shares of Common
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Stock,
sufficient shares to provide for the exercise of the rights of
purchase represented by this Warrant. The Company agrees that all
Warrant Shares issued upon due exercise of the Warrant shall be, at
the time of delivery of the certificates for such Warrant Shares,
duly authorized, validly issued, fully paid and non-assessable
shares of Common Stock.
Section 8
Adjustments . Subject and pursuant to the provisions of this
Section 8, the Warrant Price and number of Warrant Shares
subject to this Warrant shall be subject to adjustment from time to
time as set forth hereinafter.
(a) If
the Company shall, at any time or from time to time while this
Warrant is outstanding, pay a dividend or make a distribution on
its Common Stock in shares of Common Stock, subdivide its
outstanding shares of Common Stock into a greater number of shares
or combine its outstanding shares of Common Stock into a smaller
number of shares or issue by reclassification of its outstanding
shares of Common Stock any shares of its capital stock (including
any such reclassification in connection with a consolidation or
merger in which the Company is the continuing corporation), then
(i) the Warrant Price in effect immediately prior to the date
on which such change shall become effective shall be adjusted by
multiplying such Warrant Price by a fraction, the numerator of
which shall be the number of shares of Common Stock outstanding
immediately prior to such change and the denominator of which shall
be the number of shares of Common Stock outstanding immediately
after giving effect to such change and (ii) the number of
Warrant Shares purchasable upon exercise of this Warrant shall be
adjusted by multiplying the number of Warrant Shares purchasable
upon exercise of this Warrant immediately prior to the date on
which such change shall become effective by a fraction, the
numerator of which is shall be the Warrant Price in effect
immediately prior to the date on which such change shall become
effective and the denominator of which shall be the Warrant Price
in effect immediately after giving effect to such change,
calculated in accordance with clause (i) above. Such
adjustments shall be made successively whenever any event listed
above shall occur.
(b)
If any capital reorganization, reclassification of the capital
stock of the Company, consolidation or merger of the Company with
another corporation in which the Company is not the survivor,
reverse triangular merger in which the Company is the surviving
entity but the shares of the Company’s capital stock
outstanding immediately prior to the merger are converted by virtue
of the merger into other property, whether in the form of
securities, cash or otherwise, or sale, transfer or other
disposition of all or substantially all of the Company’s
assets to another corporation shall be effected, then, as a
condition of such reorganization, reclassification, consolidation,
merger, sale, transfer or other disposition, lawful and adequate
provision shall be made whereby each Warrantholder shall thereafter
have the right to purchase and receive upon the basis and upon the
terms and conditions herein specified and in lieu of the Warrant
Shares immediately theretofore issuable upon exercise of the
Warrant, such shares of stock, securities or assets as would have
been issuable or payable with respect to or in exchange for a
number of Warrant Shares equal to the number of Warrant Shares
immediately theretofore issuable upon exercise of the Warrant, had
such reorganization, reclassification, consolidation, merger, sale,
transfer or other disposition not taken place, and in any such case
appropriate provision shall be made with respect to the rights and
interests of each Warrantholder to the end that the provisions
hereof (including, without limitation, provision for adjustment of
the Warrant Price) shall thereafter be applicable, as nearly
equivalent as may be practicable in relation to any shares of
stock, securities or assets thereafter deliverable upon the
exercise hereof. The Company shall not effect any such
consolidation, merger, sale, transfer or other disposition unless
prior to or simultaneously with the consummation thereof the
successor corporation (if other than the Company) resulting from
such consolidation or merger, or the corporation purchasing or
otherwise acquiring such assets or other appropriate corporation or
entity shall assume the obligation to deliver to the Warrantholder,
at the last address of the Warrantholder appearing on the books of
the Company, such shares of stock, securities or assets as, in
accordance with the foregoing provisions, the Warrantholder may be
entitled to purchase, and
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the other
obligations under this Warrant. Such adjustments shall be made
successively whenever any event listed above shall
occur.
(c) In
case the Company shall fix a payment date for the making of a
distribution to all holders of Common Stock (including any such
distribution made in connection with a consolidation or merger in
which the Company is the continuing corporation) of evidences of
indebtedness or assets (other than dividends or distributions
referred to in Section 8(a)), or subscription rights or
warrants, the Warrant Price to be in effect after such payment date
shall be determined by multiplying the Warrant Price in effect
immediately prior to such payment date by a fraction, the numerator
of which shall be the total number of shares of Common Stock
outstanding multiplied by the Market Price (as defined below) per
share of Common Stock immediately prior to such payment date, less
the fair market value (as determined by the Company’s Board
of Directors in good faith) of said assets or evidences of
indebtedness so distributed, or of such subscription rights or
warrants, and the denominator of which shall be the total number of
shares of Common Stock outstanding multiplied by such Market Price
per share of Common Stock immediately prior to such payment date.
“Market Price” as of a particular date (the
“Valuation Date”) shall mean the following: (a) if
the subject security is then listed on the Nasdaq Global Market or
the Nasdaq Capital Market (“Nasdaq”) or any other
national stock exchange, the closing sale price of such security on
such exchange on the last trading day prior to the Valuation Date;
(b) if the subject security is then quoted on the National
Association of Securities Dealers, Inc. OTC Bulletin Board (the
“Bulletin Board”) or such similar quotation system or
association, the closing sale price of one share of such security
on the Bulletin Board or such other quotation system or association
on the last trading day prior to the Valuation Date or, if no such
closing sale price is available, the average of the high bid and
the low asked price quoted thereon on the last trading day prior to
the Valuation Date; or (c) if the subject security or subject
asset is not then listed on a national stock exchange or quoted on
the Bulletin Board or such other quotation system or association,
the fair market value of such security or asset as of the Valuation
Date, as determined in good faith by the Board of Directors of the
Company and the Warrantholder. If a subject security or subject
asset is not then listed on a national securities exchange, the
Bulletin Board or such other quotation system or association, the
Board of Directors of the Company shall respond promptly, in
writing, to an inquiry by the Warrantholder prior to the exercise
hereunder as to the fair market value of such security or asset as
determined by the Board of Directors of the Company. In the event
that the Warrantholder does not agree with the Board of
Directors’ determination of the fair market value of any
assets in respect of subpart (c) of this paragraph, the
Company and the Warrantholder shall jointly select an appraiser,
who is experienced in such matters to determine the value of such
assets. The decision of such appraiser shall be final and
conclusive, and the cost of such appraiser shall be borne equally
by the Company and the Warrantholder. Such adjustment shall be made
successively whenever such a payment date is fixed.
(d) Except
as provided in subsection (g) hereof, if and whenever the
Company shall issue or sell, or is, in accordance with any of
subsections (d)(l) through (d)(7) hereof, deemed to have issued or
sold, any shares of Common Stock for no consideration or for a
consideration per share less than the Warrant Price in effect
immediately prior to the time of such issue or sale (other than in
Excluded Issuances, as defined in subsection (g)), then and in each
such case (a “Trigger Issuance”) the then-existing
Warrant Price, shall be reduced, as of the close of business on the
effective date of the Trigger Issuance, to an adjusted Warrant
Price determined as follows:
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