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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Elysee Development Corp (PK) | USOTC:ASXSF | OTCMarkets | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.00462 | -1.94% | 0.23362 | 0.193 | 0.3345 | 0.23362 | 0.23362 | 0.23362 | 500 | 21:00:27 |
þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Nevada | 86-0837251 | |
(State or Other Jurisdiction | (I.R.S. Employer Identification | |
Of Incorporation or Organization) | Number) | |
Xavier De Cocklaan 42, 9831 Deurle, Belgium | N/A | |
(Address of Principal Executive Offices) | (Zip Code) |
Large accelerated filer o | Accelerated filer o | Non-accelerated filer o | Smaller reporting company þ | |||
(Do not check if a smaller reporting company)
|
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26 | ||||
June 30, 2008 | March 31, 2008 | |||||||
(unaudited) | ||||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$ | 1,467,692 | $ | 1,728,281 | ||||
Accounts receivable, net of allowance for doubtful accounts of $32,083 at June 30,
2008 and $32,181 at March 31, 2008
|
2,444,089 | 1,902,920 | ||||||
Inventories, net
|
1,450,696 | 1,360,709 | ||||||
Prepaid expense
|
877,486 | 970,173 | ||||||
Total current assets
|
6,239,963 | 5,962,083 | ||||||
PROPERTY AND EQUIPMENT, NET
|
907,876 | 692,609 | ||||||
OTHER ASSETS
|
675,000 | 675,000 | ||||||
Patents, net
|
107,680 | 15,827 | ||||||
TOTAL ASSETS
|
$ | 7,930,519 | $ | 7,445,519 | ||||
|
||||||||
LIABILITIES AND STOCKHOLDERS EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Current portion, long term debt
|
$ | 67,344 | $ | 58,583 | ||||
Line of Credit
|
853,621 | 779,718 | ||||||
Accounts payable
|
1,854,429 | 2,002,439 | ||||||
Accrued liabilities
|
816,023 | 781,737 | ||||||
Income taxes payable
|
15,122 | 15,121 | ||||||
Total current liabilities
|
3,606,539 | 3,637,598 | ||||||
LONG TERM DEBT
|
168,604 | 94,754 | ||||||
STOCKHOLDERS DEFICIT:
|
||||||||
Preferred Stock $0.001 par value (10,000,000 shares authorized, none issued and
outstanding)
|
| |||||||
Common stock, $0.001 par value; (50,000,000 shares authorized, 18,637,803 shares
issued and outstanding at June 30, 2008 and March 31, 2008 )
|
18,638 | 18,638 | ||||||
Additional paid-in capital
|
18,014,107 | 17,929,992 | ||||||
Accumulated deficit
|
(13,932,611 | ) | (14,263,113 | ) | ||||
Accumulated other comprehensive income (loss) (foreign currency translation adjustment)
|
55,242 | 27,650 | ||||||
Total stockholders equity (deficit)
|
4,155,376 | 3,713,167 | ||||||
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
|
$ | 7,930,519 | $ | 7,445,519 | ||||
1
For the three months ended | ||||||||
June 30, | ||||||||
2008 | 2007 | |||||||
Net sales
|
$ | 3,635,479 | $ | 1,244,657 | ||||
Cost of sales
|
1,269,424 | 665,428 | ||||||
Gross profit
|
2,366,055 | 579,229 | ||||||
Operating Expenses
|
||||||||
Research and development
|
124,958 | 29,389 | ||||||
Sales and marketing
|
671,299 | 103,241 | ||||||
General and administrative
|
1,130,313 | 744,481 | ||||||
Depreciation and amortization
|
91,261 | 65,634 | ||||||
TOTAL OPERATING EXPENSES
|
2,017,831 | 942,745 | ||||||
INCOME (LOSS) FROM OPERATIONS
|
348,224 | (363,516 | ) | |||||
OTHER INCOME (EXPENSES)
|
||||||||
Interest expense
|
(35,343 | ) | (28,829 | ) | ||||
Other income
|
17,621 | 1,392 | ||||||
TOTAL OTHER INCOME (EXPENSES)
|
(17,723 | ) | (27,437 | ) | ||||
|
||||||||
NET INCOME (LOSS) BEFORE TAX
|
$ | 330,501 | $ | (390,953 | ) | |||
|
||||||||
INCOME (LOSS) PER SHARE
|
||||||||
Basic
|
$ | 0.02 | $ | (0.03 | ) | |||
Fully diluted
|
$ | 0.01 | $ | (0.03 | ) | |||
|
||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING
|
||||||||
Basic
|
18,637,803 | 13,611,630 | ||||||
Fully diluted
|
27,000,995 | 13,611,630 | ||||||
2
For the three months ended June 30, | ||||||||
(Unaudited) | ||||||||
2008 | 2007 | |||||||
Net Income (Loss)
|
$ | 330,501 | $ | (390,953 | ) | |||
|
||||||||
OTHER COMPREHENSIVE
|
||||||||
INCOME (LOSS):
|
||||||||
Foreign currency translation adjustment
|
27,592 | 4,600 | ||||||
|
||||||||
|
||||||||
Comprehensive income (loss)
|
$ | 358,093 | $ | (386,353 | ) | |||
|
3
For the three months ended | ||||||||
June 30, | ||||||||
2008 | 2007 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||||||
Net income (loss)
|
$ | 330,501 | $ | (390,953 | ) | |||
Adjustments to reconcile net income (loss) to net cash used
by operating activities Depreciation and amortization
|
91,261 | 65,634 | ||||||
Inventory reserve
|
(48 | ) | | |||||
Allowance for doubtful accounts
|
(98 | ) | | |||||
Value of stock options issued to employees
|
88,425 | | ||||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
(541,169 | ) | 296,096 | |||||
Inventories
|
(89,987 | ) | 211,818 | |||||
Prepaid expenses
|
92,687 | (122,238 | ) | |||||
Accounts payable
|
(148,010 | ) | 382,544 | |||||
Accrued liabilities
|
34,286 | 855,583 | ||||||
Net cash provided by (used by) operating activities
|
(142,152 | ) | 1,298,484 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES
|
||||||||
Purchases of equipment
|
(287,613 | ) | (50,364 | ) | ||||
Net cash used by investing activities
|
(287,613 | ) | (50,364 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||||||
Net proceeds from private placement
|
| 6,045,294 | ||||||
Net proceeds from (repayments of) capital lease note payable
|
82,611 | (11,201 | ) | |||||
Proceeds from (repayments of) line of credit
|
34,286 | (522,226 | ) | |||||
Net cash provided by financing activities
|
116,897 | 5,511,867 | ||||||
NET (DECREASE) INCREASE IN CASH
|
(312,868 | ) | 6,759,987 | |||||
Effect of exchange rate changes on cash and cash equivalents
|
52,279 | 6,756 | ||||||
CASH AND CASH EQUIVALENTS, BEGINNING
|
1,728,281 | 126,966 | ||||||
CASH AND CASH EQUIVALENTS, ENDING
|
$ | 1,467,692 | $ | 6,893,709 | ||||
Supplemental Information:
|
||||||||
Interest paid
|
$ | 23,443 | $ | 23,376 | ||||
Income taxes paid
|
$ | | $ | | ||||
4
1. | BACKGROUND AND ORGANIZATION | |
The Company is a manufacturer and distributor of cosmetic dentistry products, including a full line of professional dental and retail Over-The-Counter tooth whitening products which are distributed in Europe, and recently in Asia and the United States. The Company manufactures many of its products in its facility in Deurle, Belgium as well as outsourced manufacturing in China. The Company distributes its products using both its own internal sales force and through the use of third party distributors. | ||
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Organization and Principles of Consolidation | ||
The accompanying consolidated financial statements include the accounts of Remedent, Inc. (formerly Remedent USA, Inc.), a Nevada corporation, and its four subsidiaries, Remedent N.V. (Belgian corporation) located in Deurle, Belgium, Remedent Professional, Inc. (incorporated in California) and a subsidiary of Remedent Professional Holdings, Inc., Remedent Asia Pte. Ltd, a wholly-owned subsidiary formed under the laws of Singapore, and Sylphar N.V. (incorporated in Belgium as a wholly owned subsidiary on September 24, 2007), (collectively, the Company). Remedent, Inc. is a holding company with headquarters in Deurle, Belgium. Remedent Professional, Inc. and Remedent Professional Holdings, Inc. have been dormant since inception. Remedent Asia Pte. Ltd., commenced operations as of July 2005. All significant inter-company accounts and transactions have been eliminated in the consolidated financial statements. Corporate administrative costs are not allocated to subsidiaries. | ||
Interim Financial Information | ||
The interim consolidated financial statements of Remedent, Inc. and Subsidiaries (the Company) are condensed and do not include some of the information necessary to obtain a complete understanding of the financial data. Management believes that all adjustments necessary for a fair presentation of results have been included in the unaudited consolidated financial statements for the interim periods presented. Operating results for the three months ended June 30, 2008, are not necessarily indicative of the results that may be expected for the year ended March 31, 2009. Accordingly, your attention is directed to footnote disclosures found in the Annual Report on Form 10-KSB for the year ended March 31, 2008, and particularly to Note 1, which includes a summary of significant accounting policies. | ||
Basis of Presentation | ||
The Companys financial statements have been prepared on an accrual basis of accounting, in conformity with accounting principles generally accepted in the United States of America. These principles contemplate the realization of assets and liquidation of liabilities in the normal course of business. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. These financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. | ||
Revenue Recognition | ||
The Company recognizes revenue from product sales when persuasive evidence of a sale exists: that is, a product is shipped under an agreement with a customer; risk of loss and title has passed to the customer; the fee is fixed or determinable; and collection of the resulting receivable is reasonably assured. Sales allowances are estimated based upon historical experience of sales returns. |
5
Impairment of Long-Lived Assets | ||
Long-lived assets consist primarily of patents and property and equipment. The recoverability of long-lived assets is evaluated by an analysis of operating results and consideration of other significant events or changes in the business environment. If impairment exists, the carrying amount of the long-lived assets is reduced to its estimated fair value, less any costs associated with the final settlement. As of June 30, 2008, management believes there was no impairment of the Companys long-lived assets. | ||
Pervasiveness of Estimates | ||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, the Company evaluates estimates and judgments, including those related to revenue, bad debts, inventories, fixed assets, intangible assets, stock based compensation, income taxes, and contingencies. Estimates are based on historical experience and on various other assumptions that the Company believes reasonable in the circumstances. The results form the basis for making judgments about the carrying vales of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. | ||
Cash and Cash Equivalents | ||
The Company considers all highly liquid investments with maturities of three months or less to be cash or cash equivalents. | ||
Accounts Receivable and Allowance for Doubtful Accounts | ||
The Company sells professional dental equipment to various companies, primarily to distributors located in Western Europe. The terms of sales vary by customer, however, generally are 2% 10 days, net 30 days. Accounts receivable is reported at net realizable value and net of allowance for doubtful accounts. The Company uses the allowance method to account for uncollectible accounts receivable. The Companys estimate is based on historical collection experience and a review of the current status of trade accounts receivable. | ||
Inventories | ||
The Company purchases certain of its products in components that require assembly prior to shipment to customers. All other products are purchased as finished goods ready to ship to customers. | ||
The Company writes down inventories for estimated obsolescence to estimated market value based upon assumptions about future demand and market conditions. If actual market conditions are less favorable than those projected, then additional inventory write-downs may be required. Inventory reserves for obsolescence totaled $15,764 at June 30, 2008 and $15,812 at March 31, 2008. | ||
Prepaid Expense | ||
The Companys prepaid expense consists of prepayments to suppliers for inventory purchases and to the Belgium customs department, to obtain an exemption of direct VAT payments for imported goods out of the European Union (EU). This prepayment serves as a guarantee to obtain the facility to pay VAT at the moment of sale and not at the moment of importing goods at the border. Prepaid expenses also include VAT payments made for goods and services in excess of VAT payments received from the sale of products as well as amounts for other prepaid operating expenses. |
6
Property and Equipment | ||
Property and equipment are stated at cost. Major renewals and improvements are charged to the asset accounts while replacements, maintenance and repairs, which do not improve or extend the lives of the respective assets, are expensed. At the time property and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation accounts are relieved of the applicable amounts. Gains or losses from retirements or sales are credited or charged to income. | ||
The Company depreciates its property and equipment for financial reporting purposes using the straight-line method based upon the following useful lives of the assets: |
Tooling
|
3 Years | |||
Furniture and fixtures
|
4 Years | |||
Machinery and Equipment
|
4 Years |
Patents | ||
Patents consist of the costs incurred to purchase patent rights and are reported net of accumulated amortization. Patents are amortized using the straight-line method over a period based on their contractual lives. | ||
Research and Development Costs | ||
The Company expenses research and development costs as incurred. | ||
Advertising | ||
Costs incurred for producing and communicating advertising are expensed when incurred and included in sales and marketing and general and administrative expenses. For the three month periods ended June 30, 2008 and June 30, 2007, advertising expense was $86,600 and $38,331, respectively. | ||
Income taxes | ||
Income taxes are provided in accordance with Statement of Financial Accounting Standards No. 109 (SFAS 109), Accounting for Income Taxes . Deferred taxes are recognized for temporary differences in the bases of assets and liabilities for financial statement and income tax reporting as well as for operating losses and credit carry forwards. A provision has been made for income taxes due on taxable income and for the deferred taxes on the temporary differences. The components of the deferred tax asset and liability are individually classified as current and non-current based on their characteristics. | ||
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. | ||
Warranties | ||
The Company typically warrants its products against defects in material and workmanship for a period of 18 months from shipment. Based upon historical trends and warranties provided by the Companys suppliers and sub-contractors, the Company has made a provision for warranty costs of $23,646 and $23,718 as of June 30, 2008 and March 31, 2008, respectively. | ||
Segment Reporting | ||
Statement of Financial Accounting Standards No. 131 (SFAS 131), Disclosure About Segments of an Enterprise and Related Information requires use of the management approach model for segment reporting. The management approach model is based on the way a companys management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. The Companys management considers its business to comprise one segment for reporting purposes. |
7
Computation of Earnings (Loss) per Share | ||
Basic net income (loss) per common share is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Net income (loss) per common share attributable to common stockholders assuming dilution is computed by dividing net income by the weighted average number of shares of common stock outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued. Potential common shares related to stock options and stock warrants are excluded from the computation when their effect is anti-dilutive. | ||
Conversion of Foreign Currencies | ||
The reporting currency for the consolidated financial statements of the Company is the U.S. dollar. The functional currency for the Companys European subsidiaries, Remedent N.V. and Sylphar N.V., is the Euro, for Remedent Asia the Singapore Dollar. Finally, the functional currency for Remedent Professional, Inc. is the U.S. dollar. The Company translates foreign currency statements to the reporting currency in accordance with FASB 52. The assets and liabilities of companies whose functional currency is other that the U.S. dollar are included in the consolidation by translating the assets and liabilities at the exchange rates applicable at the end of the reporting period. The statements of income of such companies are translated at the average exchange rates during the applicable period. Translation gains or losses are accumulated as a separate component of stockholders equity. | ||
Comprehensive Income (Loss) | ||
The Company has adopted the provisions of Statement of Financial Accounting Standards No. 130, Reporting Comprehensive Income (SFAS No. 130). SFAS No. 130 establishes standards for the reporting and display of comprehensive income, its components and accumulated balances in a full set of general purpose financial statements. SFAS No. 130 defines comprehensive income (loss) to include all changes in equity except those resulting from investments by owners and distributions to owners, including adjustments to minimum pension liabilities, accumulated foreign currency translation, and unrealized gains or losses on marketable securities. | ||
The Companys only component of other comprehensive income is the accumulated foreign currency translation consisting of gains of $27,592 and $4,600 for the three month periods ended June 30, 2008 and June 30, 2007, respectively. These amounts have been recorded as a separate component of stockholders equity. | ||
Stock Based Compensation | ||
In December 2004, the Financial Accounting Standards Board issued SFAS No. 123R, Share-Based Payment . Subsequently, the Securities and Exchange Commission (SEC) provided for a phase-in implementation process for SFAS No. 123R, which required adoption of the new accounting standard no later than January 1, 2006. SFAS No. 123R requires accounting for stock options using a fair-value-based method as described in such statement and recognize the resulting compensation expense in the Companys financial statements. Prior to January 1, 2006, the Company accounted for employee stock options using the intrinsic value method under APB No. 25, Accounting for Stock Issued to Employees and related Interpretations, which generally resulted in no employee stock option expense. The Company adopted SFAS No. 123R on January 1, 2006 and does not plan to restate financial statements for prior periods. The Company plans to continue to use the Black-Scholes option valuation model in estimating the fair value of the stock option awards issued under SFAS No. 123R. The adoption of SFAS No. 123R has a material impact on the Companys results of operations. For the three month periods ended June 30, 2008 and June 30, 2007, equity compensation in the form of stock options and grants of restricted stock totaled $88,425 and $nil, respectively. |
8
Recent Accounting Pronouncements | ||
In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities . This statement changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, and its related interpretations, and (c) how derivative instruments and related hedged items affect an entitys financial position, financial performance, and cash flows. This statement is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008 (the Companys fiscal year beginning April 1, 2009), with early application encouraged. This statement encourages, but does not require, comparative disclosures for earlier periods at initial adoption. Management is in the process of evaluating the impact the future application of this pronouncement may have on its consolidated financial statements. | ||
In December 2007, the FASB issued SFAS No. 141 (Revised 2007) Business Combinations . SFAS 141 (Revised) establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree. The statement also provides guidance for recognizing and measuring the goodwill acquired in the business combination and determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. The guidance will become effective for the Companys fiscal year beginning April 1, 2009. Management is in the process of evaluating the impact SFAS 141 (Revised) will have on the Companys financial statements upon adoption. | ||
In December 2007, the FASB issued SFAS No. 160 Noncontrolling Interests in Consolidated Financial Statements an amendment of ARB No. 51 . SFAS 160 establishes accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. The guidance will become effective for the Companys fiscal year beginning April 1, 2009. Management is in the process of evaluating the impact SFAS 160 will have on the Companys financial statements upon adoption. | ||
3. | PRIVATE PLACEMENT | |
On June 25, 2007, the Company completed its private offering of 5,600,000 shares of its common stock, par value $.001 per share at a purchase price of $1.25 per share (the Shares) and warrants to purchase 4,200,000 shares of common stock, par value $.001 per share, at an exercise price of $1.55 per share (the Warrants) to certain institutional and accredited investors, for an aggregate purchase price of $7,000,000 (the Offering). | ||
Under the terms of the Offering, the Warrants are exercisable for a period of five years and entitle the holder to purchase one share of restricted common stock (the Warrant Shares) for $1.55 per Warrant Share. The Company also has the right to redeem the Warrants for $0.001 per Warrant Share covered by the Warrants if the Shares trade on the OTC Electronic Bulletin Board or similar market above $5.25 per share for 20 consecutive trading days following the initial effective date of the registration statement covering the resale of the Shares and Warrant Shares, based upon the closing bid price for the Shares for each trading day (the Redemption Right). Once the Redemption Right vests, the Company has the right, but not the obligation, to redeem the Warrants for $0.001 per Warrant Share covered by the Warrants upon 30 days written notice to the holders of the Warrants. | ||
Under the terms of the Purchase Agreement and the Registration Rights Agreement, the Company was required to prepare and file with the Securities and Exchange Commission (the Commission) a registration statement covering the resale of the Shares and the Warrant Shares. The Company agreed to prepare and file a registration statement covering the resale no later than 30 days after the Closing. The registration statement became effective October 23, 2007. | ||
The Company engaged Roth Capital Partners, LLC, as its exclusive agent to offer the Shares and Warrants (the Placement Agent). The Placement Agent is entitled to a fee equal to ten percent (10%) of the gross proceeds derived from the Offering, of which the Placement Agent may, at its option, receive up to 2% of its 10% fee in securities issued in the Offering. Further, the Company agreed to pay the Placement Agent 5% of the exercise price of the Warrants promptly following the Companys receipt thereof. In addition, the Company agreed to reimburse the Placement Agent for its out-of-pocket expenses related to the Offering, including an up front payment of $25,000 to cover such expenses, of which any unused amount will be netted against the Placement Agents 10% fee. |
9
As of June 30, 2008, the total costs of this private placement were $1,228,808, comprising of: commissions of $762,505; out-of-pocket costs of $25,000; professional fees of $369,323 and direct travel costs of $71,980; and have been recorded against share capital as a cost of financing. | ||
The Offering was conducted in reliance upon an exemption from registration under the Securities Act of 1933, as amended (the Securities Act), including, without limitation, that under Section 506 of Regulation D promulgated under the Securities Act. The Units were offered and sold by the Company to accredited investors in reliance on Section 506 of Regulation D of the Securities. | ||
4. | CONCENTRATION OF RISK | |
Financial Instruments Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of trade accounts receivable. | ||
Concentrations of credit risk with respect to trade receivables are normally limited due to the number of customers comprising the Companys customer base and their dispersion across different geographic areas. At June 30, 2008 one customer accounted for 44% of the Companys trade accounts receivable. The Company performs ongoing credit evaluations of its customers and normally does not require collateral to support accounts receivable. | ||
Purchases The Company has diversified its sources for product components and finished goods and, as a result, the loss of a supplier would not have a material impact on the Companys operations. For the three month period ended June 30, 2008, the Company had five suppliers who accounted for a total of 25% of gross purchases. For the three month period ended June 30, 2007, the Company had five suppliers who accounted for a total of 29% of gross purchases. | ||
Revenues For the three months ended June 30, 2008 the Company had one customer that accounted for 36% of total revenues. For the three month period ended June 30, 2007 the Company had five customers that accounted for 32% of total revenues. | ||
5. | ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
A summary of accounts receivable and allowance for doubtful accounts as of June 30, 2008 and March 31, 2008 is as follows: |
June 30, 2008 | March 31, 2008 | |||||||
Accounts receivable, gross
|
$ | 2,476,172 | $ | 1,935,101 | ||||
Less: allowance for doubtful accounts
|
(32,083) | (32,181 | ) | |||||
Accounts receivable, net
|
$ | 2,444,089 | $ | 1,902,920 | ||||
6. | INVENTORIES | |
Inventories are stated at the lower of cost (weighted average) or market. Inventory costs include material, labor and manufacturing overhead. Individual components of inventory are listed below as follows: |
June 30, 2008 | March 31, 2008 | |||||||
Raw materials
|
$ | 30,681 | $ | 29,788 | ||||
Components
|
1,090,416 | 970,101 | ||||||
Finished goods
|
345,363 | 376,632 | ||||||
|
1,466,460 | 1,376,521 | ||||||
Less: reserve for obsolescence
|
(15,764) | (15,812 | ) | |||||
Net inventory
|
$ | 1,450,696 | $ | 1,360,709 | ||||
10
7. | PREPAID EXPENSES | |
Prepaid expenses are summarized as follows: |
June 30, 2008 | March 31, 2008 | |||||||
Prepaid materials and components
|
$ | 621,666 | $ | 588,639 | ||||
Prepaid Belgium income taxes
|
| 79,060 | ||||||
Prepaid consulting
|
73,861 | 62,237 | ||||||
VAT payments in excess of VAT receipts
|
82,674 | 117,467 | ||||||
Royalties
|
39,410 | 39,530 | ||||||
Prepaid trade show expenses
|
15,408 | 25,276 | ||||||
Prepaid rent
|
15,347 | 10,812 | ||||||
Other
|
29,119 | 47,152 | ||||||
|
$ | 877,486 | $ | 970,173 | ||||
8. | PROPERTY AND EQUIPMENT | |
Property and equipment are summarized as follows: |
June 30, 2008 | March 31, 2008 | |||||||
Furniture and Fixtures
|
$ | 198,789 | $ | 182,079 | ||||
Machinery and Equipment
|
984,154 | 801,251 | ||||||
Tooling
|
342,450 | 254,450 | ||||||
|
1,525,393 | 1,237,780 | ||||||
Accumulated depreciation
|
(617,517) | (545,171 | ) | |||||
Property & equipment, net
|
$ | 907,876 | $ | 692,609 | ||||
9. | LONG TERM INVESTMENTS AND ADVANCES | |
Innovative Medical & Dental Solutions, LLC (IMDS, LLC) | ||
Effective July 15, 2007 the Company entered into a Limited Liability Company Merger and Equity Reallocation Agreement (the Participation Agreement) through its subsidiary, Remedent N.V. Pursuant to the terms of the Participation Agreement, the Company has acquired a 10% equity interest in IMDS, LLC in consideration for $300,000 which was converted against IMDS receivables. | ||
The agreement stipulates certain exclusive world wide rights to certain tooth whitening technology, and the right to purchase at standard cost certain whitening lights and accessories and to sell such lights in markets not served by the LLC. The terms of the Participation Agreement also provide that Remedent N.V. has the first right to purchase additional equity. Parties to the Participation Agreement include two officers of IMDS, LLC, and an individual who is both an officer and director of Remedent Inc., and certain unrelated parties. | ||
IMDS, LLC is registered with the Secretary of the State of Florida as a limited liability company and with the Secretary of the State of California as a foreign corporation authorized to operate in California. IMDS, LLC is merging with White Science World Wide, LLC, a limited liability company organized under the laws of the State of Georgia. The merged companies are operating as a single entity as IMDS, LLC, a Florida limited liability company. | ||
Soca Networks Singapore (Soca) | ||
Pursuant to the terms of a letter of intent dated December 17, 2007, the Company has agreed to purchase 20% of Soca for a total purchase price of $750,000. Half of the purchase price has been advanced $375,000 to Soca as a down payment, pending completion of the agreement terms. The balance of $375,000 is to be paid through the issuance of 220,588 shares of the Companys common stock. The final agreement is currently being negotiated and management expects to close the agreement within the first half of the new fiscal year 2009. |
11
10. | LICENSED PATENTS | |
Teeth Whitening Patents | ||
In October 2004, the Company acquired from the inventor the exclusive, perpetual license to two issued United States patents which are applicable to several teeth whitening products currently being marketed by the Company. Pursuant to the terms of the license agreement, the Company was granted an exclusive, worldwide, perpetual license to manufacture, market, distribute and sell the products contemplated by the patents subject to the payment of $65,000 as reimbursement to the patent holder for legal and other costs associated with obtaining the patents, which was paid in October 2004, and royalties for each unit sold subject to an annual minimum royalty of $100,000 per year. The Company is amortizing the initial cost of $65,000 for these patents over a ten year period and accordingly has recorded $24,375 of accumulated amortization for this patent as of June 30, 2008. The Company accrues this royalty when it becomes payable to inventory therefore no provision has been made for this obligation as of June 30, 2008 (2007-Nil). | ||
Universal Applicator Patent | ||
In September 2004, the Company entered into an agreement with Lident N.V. (Lident), a company controlled by Mr. De Vreese, the Companys Chairman, to obtain an option, exercisable through December 31, 2005, to license an international patent (excluding the US) and worldwide manufacturing and distribution rights for a potential new product which Lident had been assigned certain rights by the inventors of the products, who are unrelated parties, prior to Mr. De Vreese association with the Company. The patent is an Italian patent which relates to a single use universal applicator for dental pastes, salves, creams, powders, liquids and other substances where manual application could be relevant. The Company has filed to have the patent approved throughout Europe. The agreement required the Company to advance to the inventors through Lident a fully refundable deposit of 100,000 subject to the Companys due diligence regarding the enforceability of the patent and marketability of the product, which, if viable, would be assigned to the Company for additional consideration to the inventors of 100,000 and an ongoing royalty from sales of products related to the patent equal to 3% of net sales and, if not viable, the deposit would be repaid in full by Lident. The consideration the Company had agreed to pay Lident upon the exercise of the option is the same as the consideration Lident is obligated to pay the original inventors. Consequently, Lident would not have profited from the exercise of the option. Furthermore, at a meeting of the Companys Board of Directors on July 13, 2005, the Board accepted Lidents offer to facilitate an assignment of Lidents intellectual property rights to the technology to the Company in exchange for the reimbursement of Lidents actual costs incurred relating to the intellectual property. Consequently, when the Company exercises the option, all future payments, other than the reimbursement of costs would be paid directly to the original inventors and not to Lident. | ||
On December 12, 2005, the Company exercised the option and the Company and the patent holder agreed to revise the assignment agreement whereby the Company agreed to pay 50,000 additional compensation in the form of prepaid royalties instead of the 100,000 previously agreed. The Company paid 25,000 in September 2005 and the remaining 25,000 was paid in the period ended June 30, 2008. The patent is being amortized over five (5) years and accordingly, the Company has recorded $61,411 of accumulated amortization for this patent as of June 30, 2008. | ||
11. | LINE OF CREDIT | |
On October 8, 2004, our wholly owned subsidiary, Remedent N.V., obtained a mixed-use line of credit facility with Fortis Bank, a Belgian bank, for 1,070,000 (the Facility). The Facility was secured by a first lien on the assets of Remedent N.V. The purpose of the Facility is to provide working capital to grow our business and to finance certain accounts receivable as necessary. Since opening the Facility in 2004, Remedent N.V. and Fortis Bank have subsequently amended the Facility several times to increase or decrease the line of credit. On May 3, 2005 the Facility was amended to decrease the line of credit to 1,050,000. On March 13, 2006 the Facility was amended to increase the mixed-use line of credit to 2,300,000, consisting of a 1,800,000 credit line based on the eligible accounts receivable and a 500,000 general line of credit. The latest amendment to the Facility, dated January 3, 2008, amended and decreased the mixed-use line of credit to 2,050,000, to be used by Remedent NV and/or Sylphar NV. Each line of credit carries its own interest rates and fees as provided in the Facility. |
12
Remedent N.V. and Sylphar N.V. are currently only utilizing two lines of credit, advances based on account receivables and the straight loan. As of June 30, 2008 and March 31, 2008, Remedent N.V. and Sylphar N.V. had in aggregate, $853,621 and $779,718 in advances outstanding, respectively, under this mixed-use line of credit facility. | ||
12. | LONG TERM DEBT | |
On June 15, 2005, the Company entered into two five year capital lease agreements for manufacturing equipment totaling 70,296 (US $85,231). On October 24, 2006, the Company entered into another five year capital lease agreement for additional manufacturing equipment totaling 123,367 (US $157,503). On May 15, 2008, the company entered into a third capital lease agreement over a three year period for additional manufacturing equipment totaling 63,395 (US $ 98,516).The leases require monthly payments of principal and interest at 7.43% of 1,258 (US$1,983 at June 30, 2008) for the first two leases and 9.72% of 2,276 (US$3,588 at June 30, 2008) and provide for buyouts at the conclusion of the five year term of 2,820 (US$4,445) or 4.0% of original value for the first two contracts and 4,933 (US $7,776) or 4.0 % of the original value for the second contract. Concerning the third lease contract requires monthly payments of principal and interest at 9,40% of 1,909 (US $ 3,009 at June 30, 2008) and provides for buyout at the conclusion of the three year term of 633,95 (US $ 999) or 1% of the original value of this contract. | ||
The book value as of June 30, 2008 and March 31, 2008 of the equipment subject to the foregoing leases are $235,947 and $149,673, respectively. | ||
13. | DUE TO RELATED PARTIES AND RELATED PARTY TRANSACTIONS | |
Borrowings from employees and entities controlled by officers of the Company are, unsecured, non-interest bearing, and due on demand. | ||
Transactions with related parties consisted of the following: | ||
Compensation: | ||
During the three month periods ended June 30, 2008 and 2007 respectively, the Company incurred $179,632 and $156,594 respectively, as compensation for all directors and officers. | ||
Sales Transactions: | ||
One of the Companys directors owns a minority interest in a client company, IMDS Inc., to which goods were sold during the quarter ended June 30, 2008 and 2007 totaling $34,980 and $355 respectively. Accounts receivable at year end with this customer totaled $91,533 and $392,057 as at March 31, 2008 and 2007 respectively. | ||
Accounts receivable with this customer totaled $47,429 and $361,129 as at June 30, 2008 and 2007 respectively. | ||
All related party transactions involving provision of services or tangible assets were recorded at the exchange amount, which is the value established and agreed to by the related parties reflecting arms length consideration payable for similar services or transfers. |
13
14. | ACCRUED LIABILITIES | |
Accrued liabilities are summarized as follows: |
June 30, 2008 | March 31, 2008 | |||||||
Accrued employee benefit taxes and payroll
|
$ | 142,247 | $ | 178,645 | ||||
Accrued Travel
|
11,823 | 17,667 | ||||||
Advances and deposits
|
6,655 | 212,736 | ||||||
Commissions
|
254,861 | 130,875 | ||||||
Accrued audit and tax preparation fees
|
8,343 | 4,000 | ||||||
Reserve for warranty costs
|
23,646 | 23,718 | ||||||
Accrued interest
|
| 984 | ||||||
Accrued consulting fees
|
3,288 | 35,204 | ||||||
Other accrued expenses
|
271,112 | 177,908 | ||||||
|
$ | 816,023 | $ | 781,737 | ||||
15. | EQUITY COMPENSATION PLANS | |
The Board of Directors and stockholders approved the Nonstatutory Stock Option Plan (the 2001 Plan) and adopted it on May 29, 2001. The Company has reserved 250,000 shares of its common stock for issuance to the directors, employees and consultants under the Plan. The Plan is administered by the Board of Directors. Vesting terms of the options range from immediately to five years. | ||
Pursuant to an Information Statement on Schedule 14C mailed on May 9, 2005 to all stockholders of record as of the close of business on February 1, 2005 and became effective June 3, 2005, the Company authorized the implementation of a 2004 Incentive and Nonstatutory Stock Option Plan (2004 Plan) reserving 800,000 shares of common stock for issuance to employees, directors and consultants of the Company or any subsidiaries. This plan became effective as of June 3, 2005 after the Company had completed a one for twenty reverse split. | ||
On August 17, 2007, pursuant to the terms of the Companys 2004 Plan, the Company granted to an employee 100,000 options to purchase the Companys common stock at a price of $1.50 per share. These options will vest over the next 3 years and are exercisable for a period of 5 years. The Company valued the foregoing options using the Black Scholes option pricing model using the following assumptions: no dividend yield; expected volatility rate of 115%; risk free interest rate of 4.75% and an average life of 5 years resulting in a value of $1.24 per option granted. The value of these options will be recognized on a straight-line basis over the next three years and accordingly a value of $28,780 has been recorded in the year ended March 31, 2008. | ||
On September 21, 2007 the Company granted to employees and directors a total of 570,000 options to purchase the Companys common stock at a price of $1.75 per share. These options will vest over the next 3 years and are exercisable for a period of 10 years. The Company valued the foregoing options using the Black Scholes option pricing model using the following assumptions: no dividend yield; expected volatility rate of 115%; risk free interest rate of 4.75% and an average life of 7 years resulting in a value of $1.47 per option granted. The value of these options will be recognized on a straight-line basis over the next three years and accordingly a value of $88,425 has been recorded in the three months ended June 30, 2008 (2007 $nil). |
14
A summary of the option activity for the three months ended June 30, 2008 pursuant to the terms of the plans is as follows: |
2001 Plan | 2004 Plan | Other | ||||||||||||||||||||||
Weighted | Weighted | Weighted | ||||||||||||||||||||||
Outstanding | Average | Outstanding | Average | Outstanding | Average | |||||||||||||||||||
Options | Exercise Price | Options | Exercise Price | Options | Exercise Price | |||||||||||||||||||
Options outstanding , March 31, 2008
|
222,500 | $ | 1.29 | 730,666 | $ | 4.46 | 150,000 | $ | 1.75 | |||||||||||||||
|
||||||||||||||||||||||||
Granted
|
| | | | | | ||||||||||||||||||
Exercised
|
| | | | | | ||||||||||||||||||
Cancelled or expired
|
| | | | | | ||||||||||||||||||
|
||||||||||||||||||||||||
Options outstanding, June 30, 2008
|
222,500 | $ | 1.29 | 730,666 | $ | 2.17 | 150,000 | $ | 1.75 | |||||||||||||||
|
||||||||||||||||||||||||
Options exercisable June 30, 2008
|
222,500 | $ | 1.29 | 210,666 | $ | 4.25 | | | ||||||||||||||||
|
||||||||||||||||||||||||
Exercise price range
|
$ | 1.00 to $4.00 | $ | 1.50 to $4.00 | $ | 1.75 | ||||||||||||||||||
|
||||||||||||||||||||||||
Weighted average remaining life
|
3.8 years | 7.8 years | 9.23 years | |||||||||||||||||||||
|
||||||||||||||||||||||||
Shares available for future issuance
|
27,500 | 69,334 | N/A | |||||||||||||||||||||
|
A summary of the Companys equity compensation plans approved and not approved by shareholders is as follows: |
Number of | Number of securities | |||||||||||
securities to be | remaining available for | |||||||||||
issued upon | future issuance under | |||||||||||
exercise of | Weighted-average | equity compensation | ||||||||||
outstanding | exercise price of | plans (excluding | ||||||||||
options, warrants | outstanding options | securities reflected | ||||||||||
Plan Category | and right | warrants and rights | in column (a)) | |||||||||
Equity Compensation Plans approved by security holders
|
1,103,166 | $ | 1.93 | 96,834 | ||||||||
Equity Compensation Plans not approved by security holders
|
297,298 | $ | 1.50 | NA | ||||||||
|
||||||||||||
|
1,400,464 | $ | 1.84 | 96,834 | ||||||||
|
Prior to January 1, 2006, the Company accounted for employee stock-based compensation under the recognition and measurement principles of Accounting Principles Board Opinion (APB) No. 25, Accounting for Stock Issued to Employees, and related Interpretations, as permitted by SFAS No. 123, Accounting for Stock-Based Compensation. Under the recognition principles of APB No. 25, compensation expense related to restricted stock and performance units was recognized in the financial statements. However, APB No. 25 generally did not require the recognition of compensation expense for stock options because the exercise price of these instruments was generally equal to the fair value of the underlying common stock on the date of grant, and the related number of shares granted were fixed at that point in time. | ||
Effective January 1, 2006, the Company adopted the fair value recognition provisions of SFAS No. 123(R), Share-Based Payment. In addition to recognizing compensation expense related to restricted stock and performance units, SFAS No. 123(R) also requires recognition of compensation expense related to the estimated fair value of stock options. The Company adopted SFAS No. 123(R) using the modified-prospective-transition method. Under that transition method, compensation expense recognized subsequent to adoption includes: (a) compensation cost for all share-based payments granted prior to, but not yet vested as of January 1, 2006, based on the values estimated in accordance with the original provisions of SFAS No. 123, and (b) compensation cost for all share-based payments granted subsequent to January 1, 2006, based on the grant-date fair values estimated in accordance with the provisions of SFAS No. 123(R). Consistent with the modified-prospective-transition method, the Companys results of operations for prior periods have not been adjusted to reflect the adoption of FAS 123(R). For the three months ended June 30, 2008 the Company recognized $88,425 (2007 $nil) in compensation expense in the consolidated statement of operations. |
15
16. | COMMON STOCK WARRANTS AND OTHER OPTIONS | |
As of June 30, 2008, the Company has 7,260,026 warrants to purchase the Companys common stock outstanding that were not granted under shareholder approved equity compensation plans at prices ranging between $1.20 and $3.00 per share with expiration dates between August 2007 and September 2012 as follows: |
Weighted | ||||||||
Outstanding | Average Exercise | |||||||
Warrants | Price | |||||||
Warrants and options outstanding , March 31, 2008
|
7,260,026 | $ | 1.67 | |||||
Granted
|
| | ||||||
|
||||||||
Exercised
|
| | ||||||
|
||||||||
Cancelled or expired
|
| | ||||||
|
||||||||
Warrants exercisable March 31, 2008
|
7,260,026 | $ | 1.62 | |||||
|
||||||||
Exercise price range
|
$ | 1.20 to $3.00 | ||||||
|
||||||||
Weighted average remaining life
|
3.16 Years | |||||||
|
17. | SEGMENT INFORMATION | |
The Companys only operating segment consists of dental products and oral hygiene products sold by Remedent Inc., Remedent N.V., Sylphar N.V. and Remedent Asia Ltd.. Since the Company only has one segment, no further segment information is presented. | ||
Customers Outside of the United States |
June 30, 2008 | June 30, 2007 | |||||||
U.S. sales
|
$ | 2,158,900 | $ | 33,777 | ||||
Foreign sales
|
1,476,579 | 1,210,880 | ||||||
|
||||||||
|
$ | 3,635,479 | $ | 1,244,657 | ||||
|
18. | COMMITMENTS | |
Real Estate Lease | ||
The Company leases its 26,915 square feet office and warehouse facility in Deurle, Belgium from an unrelated party pursuant to a nine year lease commencing December 20, 2001 at a base rent of $6,838 per month ($11,097 per month at June 30, 2008). The minimum aggregate rent to be paid over the remaining lease term based upon the conversion rate for the at March 31, 2008 is $359,773. | ||
Minimum monthly lease payments for real estate, and all other leased equipment for the next three years are as follows based upon the conversion rate for the (Euro) at June 30, 2008. |
March 31, 2009
|
$ | 240,734 | ||
March 31, 2010
|
$ | 76,896 | ||
March 31, 2011
|
$ | 42,143 | ||
Total:
|
$ | 359,773 |
Factoring Agreement | ||
On April 24, 2008, the Company entered into a Factoring Agreement (Agreement) with First Community Financial, a division of Pacific Western Bank (First Community) whereby First Community may purchase, from time to time, on a limited recourse basis such of the Companys accounts now existing or hereafter created and arising out of the sale of goods or service by the Company. The factoring credit facility limit is $1,000,000 and amounts factored are subject to an interest rate of prime plus 2%. Security for the factoring credit facility is a first charge over all the assets of the Company. The Agreement shall remain in effect until October 16, 2008 and may be renewed for successive six month periods unless terminated under certain conditions. |
16
17
18
For the three months ended | ||||||||
June 30, | ||||||||
2008 | 2007 | |||||||
NET SALES
|
100.00 | % | 100.00 | % | ||||
COST OF SALES
|
34.92 | % | 53.46 | % | ||||
|
||||||||
GROSS PROFIT
|
65.08 | % | 46.54 | % | ||||
|
||||||||
OPERATING EXPENSES
|
||||||||
Research and development
|
3.44 | % | 2.36 | % | ||||
Sales and marketing
|
18.47 | % | 8.29 | % | ||||
General and administrative
|
31.09 | % | 59.81 | % | ||||
Depreciation and amortization
|
2.51 | % | 5.27 | % | ||||
|
||||||||
TOTAL OPERATING EXPENSES
|
55.50 | % | 75.74 | % | ||||
|
||||||||
INCOME (LOSS) FROM OPERATIONS
|
9.58 | % | (29.21 | )% | ||||
|
||||||||
Other income (expense)
|
(0.49 | )% | (2.20 | )% | ||||
|
||||||||
INCOME (LOSS) BEFORE INCOME TAXES
|
9.09% | (31.41 | )% | |||||
|
||||||||
NET INCOME (LOSS)
|
9.09 | % | (31.41 | )% | ||||
19
20
21
22
23
Exhibit No | Description | |||
|
||||
2.1 |
Stock Exchange Agreement with Resort World Enterprises, Inc. (1)
|
|||
|
||||
3.1 |
Articles of Incorporation of Jofran Confectioners International, Inc., a Nevada
corporation, dated July 31, 1986 (1)
|
|||
|
||||
3.2 |
Amendment to Articles of Incorporation changing name from Jofran Confectioners
International, Inc., a Nevada corporation, to Cliff Typographers, Inc., a Nevada
corporation, dated July 31, 1986 (1)
|
|||
|
||||
3.3 |
Amendment to Articles of Incorporation changing name from Cliff Typographers, Inc., a
Nevada corporation, to Cliff Graphics International, Inc., a Nevada corporation, dated
January 9, 1987 (1)
|
|||
|
||||
3.4 |
Amendment to Articles of Incorporation changing name from Cliff Graphics International,
Inc., a Nevada corporation, to Global Golf Holdings, Inc., a Nevada corporation, dated
March 8, 1995 (1)
|
|||
|
||||
3.5 |
Amendment to Articles of Incorporation changing name from Global Golf Holdings, Inc., a
Nevada corporation, to Dino Minichiello Fashions, Inc., a Nevada corporation, dated
November 20, 1997 (1)
|
|||
|
||||
3.6 |
Amendment to Articles of Incorporation changing name from Dino Minichiello Fashions, Inc.,
a Nevada corporation, to Resort World Enterprises, Inc., a Nevada corporation, dated
August 18, 1998 (1)
|
|||
|
||||
3.7 |
Amendment to Articles of Incorporation changing name from Resort World Enterprises, Inc.,
a Nevada corporation, to Remedent , Inc., dated October 5, 1998 (1)
|
|||
|
||||
3.8 |
Amended and Restated Articles of Incorporation changing name from Remedent, USA, Inc. to
Remedent, Inc. and to effect a one-for-twenty reverse stock split on June 3, 2005 (2)
|
|||
|
||||
3.9 |
Amended and Restated Bylaws (2)
|
|||
|
||||
4.1 |
Specimen of Stock Certificate (3)
|
|||
|
||||
4.2 |
Form of Subscription Agreement (4)
|
|||
|
||||
4.3 |
Form of Warrant for Common Stock (4)
|
|||
|
||||
4.4 |
Form of Registration Rights Agreement (4)
|
|||
|
||||
4.5 |
Form of Warrant for Unit (5)
|
|||
|
||||
4.6 |
Form of Warrant for Common Stock (6)
|
|||
|
||||
10.1 |
Distribution Agreement, dated April 10, 2008, by and between Remedent N.V. and GlamTech
USA, Inc. (7)
|
|||
|
||||
10.2 |
Factoring Agreement between Remedent, Inc. and First Community Financial, a division of
Pacific Western Bank, dated April 24, 2008 (8)
|
|||
|
||||
10.3 |
OEM Agreement between Remedent, Inc. and SensAble Technologies, Inc., dated June 30, 2008 (9)
|
|||
|
||||
31.1 |
Certifications of the Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act.*
|
|||
|
||||
31.2 |
Certifications of the Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act.*
|
|||
|
||||
32.1 |
Certifications of the Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act.*
|
|||
|
||||
32.2 |
Certifications of the Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act.*
|
* | Filed herewith. | |
(1) | Incorporated by reference from Registration Statement on Form SB-2 filed with the SEC on July 24, 2002. | |
(2) | Incorporated by reference from Form 8-K filed with the SEC on June 8, 2005. | |
(3) | Incorporated by reference from Form SB-2 filed with the SEC on August 4, 2005. | |
(4) | Incorporated by reference from Form 8-K filed with the SEC on July 11, 2005. | |
(5) | Incorporated by reference from Form SB-2/A filed with the SEC on October 26, 2005 | |
(6) | Incorporated by reference from Form 8-K filed with the SEC on June 27, 2007. |
24
(7) |
Incorporated by reference from Form 8-K filed with the SEC on April 15, 2008.
|
|
(8) | Incorporated by reference from Form 8-K filed with the SEC on April 30, 2008. | |
(9) | Incorporated by reference from Form 8-K filed with the SEC on July 7, 2008. |
25
REMEDENT, INC.
|
||||
Date: August 19, 2008 | By: | /s/ Robin List | ||
Name: | Robin List | |||
Title: | Chief Executive Officer | |||
Date: August 19, 2008 | By: | /s/ Philippe Van Acker | ||
Name: | Philippe Van Acker | |||
Title: | Chief Financial Officer | |||
26
þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Nevada | 86-0837251 | |
(State or other jurisdiction of
incorporation or organization) |
(I.R.S. Employer
Identification Number) |
|
Xavier de Cocklaan 42, 9831 Deurle, Belgium | N/A | |
(Address of principal executive offices) | (Zip code) |
3 | ||||
3 | ||||
12 | ||||
13 | ||||
13 | ||||
13 | ||||
13 | ||||
14 | ||||
30 | ||||
30 | ||||
30 | ||||
31 | ||||
31 | ||||
31 | ||||
31 | ||||
34 | ||||
34 | ||||
37 | ||||
38 | ||||
39 | ||||
41 | ||||
44 |
| Entered into distribution agreement with Vemedia N.V., a corporation under the laws of the Netherlands (Vemedia) whereby Vemedia agreed to be the exclusive distributor of our products in the Netherlands. | ||
| Entered into a distribution agreement with GlamTech USA, Inc., a corporation under the laws of Delaware (GlamTech) whereby GlamTech agreed to be the exclusive distributor of our GlamSmile products in the United States and Canada. | ||
| Continued to advance our sales and distribution channels for our new teeth whitening products, iWhite and MetaTray ® , in Europe and the United States; | ||
| Continued to advance our new Reme)Sense Tray and Foam Strips products, which provide a remedy for sensitive teeth. |
3
| no local anesthesia is required to prepare the teeth; | ||
| reduced (if any) tooth sensitivity post-procedure; and | ||
| the process is reversible. |
4
| Does not require chair time. | ||
| Incorporates all the benefits of heat and light for activating gel. | ||
| Introduces a proprietary gel delivery system that eliminates dripping and running while enhancing protection for surrounding gums and tissue. |
5
6
7
8
9
| Better combined pricing strategy than the competition when considering net cost for whitening materials and initial cost of light. | ||
| Dual purpose light to maximize value of initial investment. | ||
| Ease of use from automated functionality of light, speed and gel application method. | ||
| Superior gel formulation which maximizes performance while minimizing sensitivity. | ||
| Home maintenance kit for improved patient satisfaction. |
10
11
12
Bid Prices | ||||||||
High | Low | |||||||
Quarter ended June 30, 2006
|
$ | 2.75 | $ | 1.80 | ||||
Quarter ended September 30, 2006
|
$ | 2.10 | $ | 1.40 | ||||
Quarter ended December 31, 2006
|
$ | 1.80 | $ | 0.95 | ||||
Quarter ended March 31, 2007
|
$ | 2.05 | $ | 1.39 | ||||
Quarter ended June 30, 2007
|
$ | 1.85 | $ | 1.40 | ||||
Quarter ended September 30, 2007
|
$ | 1.95 | $ | 1.40 | ||||
Quarter ended December 31, 2007
|
$ | 3.15 | $ | 1.45 | ||||
Quarter ended March 31, 2008
|
$ | 1.75 | $ | 0.90 |
13
Number of | Number of securities | |||||||||||
securities to be | remaining available for | |||||||||||
issued upon | future issuance under | |||||||||||
exercise of | Weighted-average | equity compensation | ||||||||||
of outstanding | exercise price of | plans (excluding | ||||||||||
options, warrants | outstanding options | securities reflected | ||||||||||
Plan Category | and right | warrants and rights | in column (a)) | |||||||||
Equity Compensation Plans approved by security holders
|
1,103,166 | $ | 2.01 | 96,834 | ||||||||
Equity Compensation Plans not approved by security holders
|
297,298 | $ | 1.50 | NA | ||||||||
Total
|
1,400,464 | $ | 1.91 | 96,834 |
14
15
16
17
18
2008 | 2007 | |||||||
|
||||||||
NET SALES
|
100.00 | % | 100.00 | % | ||||
COST OF SALES
|
53.14 | % | 50.07 | % | ||||
|
||||||||
GROSS PROFIT
|
46.86 | % | 49.93 | % | ||||
|
||||||||
OPERATING EXPENSES
|
||||||||
Research and development
|
4.45 | % | 5.12 | % | ||||
Sales and marketing
|
25.21 | % | 13.31 | % | ||||
General and administrative
|
54.22 | % | 49.26 | % | ||||
Depreciation and amortization
|
4.03 | % | 3.14 | % | ||||
|
||||||||
TOTAL OPERATING EXPENSES
|
87.91 | % | 70.83 | % | ||||
|
||||||||
INCOME (LOSS) FROM OPERATIONS
|
(41.05 | )% | (20.89 | )% | ||||
|
||||||||
Other income (expense)
|
(0.23 | )% | (1.51 | )% | ||||
INCOME (LOSS) BEFORE INCOME TAXES
|
(41.27 | )% | (22.41 | )% | ||||
Income tax benefit (expense)
|
(0.36 | % | 0.00 | )% | ||||
|
||||||||
NET INCOME (LOSS)
|
(41.64 | )% | (22.41 | )% | ||||
19
20
21
22
| variation in demand for our products, including variation due to seasonality; | ||
| our ability to research, develop, introduce, market and gain market acceptance of new products and product enhancements in a timely manner; | ||
| our ability to control costs; | ||
| the size, timing, rescheduling or cancellation of orders from distributors; | ||
| the introduction of new products by competitors; | ||
| long sales cycles and fluctuations in sales cycles; | ||
| the availability and reliability of components used to manufacture our products; | ||
| changes in our pricing policies or those of our suppliers and competitors, as well as increased price competition in general; | ||
| the risks and uncertainties associated with our international business; | ||
| costs associated with any future acquisitions of technologies and businesses; | ||
| developments concerning the protection of our proprietary rights; and | ||
| general global economic, political, international conflicts, and acts of terrorism. |
23
24
25
| decreased demand for our products; | ||
| injury to our reputation; | ||
| costs of related litigation; | ||
| substantial monetary awards to customers; | ||
| product recalls; | ||
| loss of revenue; and | ||
| the inability to commercialize our products. |
26
27
28
| difficulties in collecting accounts receivable and longer collection periods, | ||
| changes in overseas economic conditions, | ||
| fluctuations in currency exchange rates, | ||
| potentially weaker intellectual property protections, | ||
| changing and conflicting local laws and other regulatory requirements, | ||
| political and economic instability, | ||
| war, acts of terrorism or other hostilities, | ||
| potentially adverse tax consequences, | ||
| difficulties in staffing and managing foreign operations, or | ||
| tariffs or other trade regulations and restrictions. |
29
30
(a) | Managements Annual Report on Internal Control Over Financial Reporting. |
(b) | Attestation Report of the Registered Public Accounting Firm. |
(c) | Changes in internal control over Financial Reporting |
31
Person | Age | Position | ||||
Guy De Vreese
|
53 | Chairman | ||||
Robin List
|
37 | Director, Chief Executive Officer | ||||
Philippe Van Acker
|
43 | Chief Financial Officer | ||||
Stephen Ross
|
49 | Director, Secretary | ||||
Fred Kolsteeg
|
64 | Director |
32
33
Stock | Option | All Other | ||||||||||||||||||||||||||
Name and Principal Position | Year | Salary | Bonus | Awards | Awards | Compensation | Total | |||||||||||||||||||||
Guy De Vreese,
|
2008 | -0- | -0- | -0- | $ | 315,442 | (1) | $ | 315,442 | (1) | ||||||||||||||||||
Chairman, CEO of Remedent N.V.
|
2007 | $ | -0- | $ | -0- | $ | -0- | $ | -0- | $ | 294,429 | (1) | $ | 294,429 | (1) | |||||||||||||
|
||||||||||||||||||||||||||||
Robin List,
|
2008 | $ | 252,567 | $ | -0- | $ | -0- | $ | -0- | $ | -0- | $ | 252,567 | |||||||||||||||
CEO
|
2007 | $ | 239,045 | $ | -0- | $ | -0- | $ | -0- | $ | -0- | $ | 239,045 | |||||||||||||||
|
||||||||||||||||||||||||||||
Philippe Van Acker,
|
2008 | $ | 162,658 | $ | -0- | $ | -0- | $ | -0- | $ | -0- | $ | 162,658 | |||||||||||||||
CFO
|
2007 | $ | 138,573 | $ | -0- | $ | -0- | $ | $ | 138,573 |
(1) | These amounts are consulting fees including a car allowance paid by Remedent N.V. to Lausha, N.V., a company controlled by Mr. De Vreese, pursuant to an oral consulting agreement between Lausha N.V. and Remedent N.V. |
a. | each person known by us to be the beneficial owner of more than 5% of our common stock; | ||
b. | each of our directors; | ||
c. | each of our executive officers; and | ||
d. | our executive officers, directors and director nominees as a group. |
34
Shares Beneficially | Percentage | |||||||
Beneficial owner (1) | Owned | Beneficially Owned | ||||||
|
||||||||
Guy De Vreese, Chairman (2)
Xavier de Cocklaan 42 9831 Deurle, Belgium |
5,393,580 | 28.31 | % | |||||
|
||||||||
Robin List, CEO, Director (3)
Xavier de Cocklaan 42 9831 Deurle, Belgium |
882,827 | 4.19 | % | |||||
|
||||||||
Philippe Van Acker, CFO (4)
Xavier de Cocklaan 42 9831 Deurle, Belgium |
101,667 | * | ||||||
|
||||||||
Stephen Ross, Secretary, Director (5)
1921 Malcolm #101 Los Angeles, CA 90025 |
518,777 | 2.77 | % | |||||
|
||||||||
Fred Kolsteeg (6)
Managelaantje 10 3062 CV Rotterdan The Netherlands |
110,000 | * | ||||||
|
||||||||
All Officers and Directors as a Group (5 persons)
|
7,006,851 | 36.78 | % | |||||
|
||||||||
5% or Greater Shareholders
|
||||||||
|
||||||||
Special Situations Private Equity Fund, L.P. (7)
|
5,853,049 | 27.25 | % | |||||
|
||||||||
Special Situations Cayman Fund LP (8)
|
1,255,067 | 6.62 | % | |||||
|
||||||||
Austin W. Marxe and David M. Greenhouse (9)
153 East 53rd Street, 55th FL New York, NY 10022 |
7,814,816 | 35.57 | % | |||||
|
||||||||
Potomac Capital Partners LP (10)
|
990,185 | 5.19 | % | |||||
|
||||||||
Paul J. Solit (11)
|
2,380,000 | 12.11 | % | |||||
|
||||||||
Lagunitas Partners LP (12)
|
1,384,600 | 7.20 | % | |||||
|
||||||||
Jon D. Gruber (13)
|
1,971,200 | 10.12 | % |
* | Less than one percent | |
(1) | Beneficial ownership has been determined in accordance with Rule 13d-3 under the Exchange Act. Pursuant to the rules of the Securities and Exchange Commission, shares of common stock which an individual or group has a right to acquire within 60 days pursuant to the exercise of options or warrants are deemed to be outstanding for the purpose of computing the percentage ownership of such individual or group, but are not deemed to be beneficially owned and outstanding for the purpose of computing the percentage ownership of any other person shown in the table. | |
(2) | Guy De Vreese holds 3,204,426 shares in his own name, which such amount includes 50,000 |
35
shares of common stock underlying options which vested on March 29, 2002 and have an exercise price of $1.00 per share; 100,000 shares of common stock underlying options which vested on September 17, 2007 and have an exercise price of $1.75 per share; 79,254 shares of common stock held in the name of Lausha N.V., a Belgian company controlled by Guy De Vreese and 9,900 shares of common stock underlying warrants with an exercise price of $10.00 per share held in the name of Lausha N.V., a Belgian company controlled by Guy De Vreese; 2,000,000 shares of common stock held in the name of Lausha HK, a Hong Kong company controlled by Guy De Vreese. | ||
(3) | Includes 50,000 shares of common stock underlying options which vested on March 29, 2002 and have an exercise price of $1.00 per share, as well as 100,000 shares of common stock underlying options which vested on September 17, 2007 and have an exercise price of $1.75 per share. | |
(4) | Includes 10,000 shares of common stock underlying options which vested on March 29, 2002 and have an exercise price of $1.00 per share; includes 75,000 shares of common stock underlying options which vested on December 2005 and have an exercise price of $2.46 per share; and includes 16,667 shares of common stock underlying options which vested on September 17, 2007 and have an exercise price of $1.75 per share. | |
(5) | Includes 50,000 shares of common stock underlying options which vested on March 29, 2002 and have an exercise price of $1.00 per share and 12,500 shares of common stock underlying options which vested on April 8, 2004 and have an exercise price of $2.00 per share. | |
(6) | Consists of 50,000 shares of common stock held in his own name, including 5,000 shares of common stock underlying options which vested on March 29, 2002 and have an exercise price of $1.00 per share, 60,000 shares of common stock held by Kolsteeg Beleggingsmaatschappij B.V., a Dutch company of which Fred Kolsteeg is the principal, including 10,000 shares of common stock underlying warrants held by Kolsteeg Beleggingsmaatschappij B.V. with an exercise price of $10.00 per share. | |
(7) | Consists of 3,010,667 shares of common stock of the Company held by Special Situations Private Equity Fund, L.P. (SSF Private Equity) and warrants to purchase 2,842,382 shares of common stock held by SSF Private Equity. Such securities are also included and reflected in the disclosure for Austin W. Marxe and David M. Greenhouse, per footnote 9 below. | |
(8) | Consists of 940,067 shares of common stock held by Special Situations Cayman Fund, L.P. (SSF Cayman) and warrants to purchase 315,000 shares of common stock held by SSF Cayman. Such securities are also included and reflected in the disclosure for Austin W. Marxe and David M. Greenhouse, per footnote 9 below. | |
(9) | Consists of 3,010,667 shares of common stock of the Company held by Special Situations Private Equity Fund, L.P. (SSF Private Equity) and warrants to purchase 2,842,382 shares of common stock held by SSF Private Equity; 529,700 shares of common stock held by Special Situations Fund III QP, L.P. (SSF QP) and warrants to purchase 177,000 shares of common stock held by SSF QP; 940,067 shares of common stock held by Special Situations Cayman Fund, L.P. (SSF Cayman) and warrants to purchase 315,000 shares of common stock held by SSF Cayman. MGP Advisors Limited (MGP) is the general partner of SSF QP. AWM Investment Company, Inc. (AWM) is the general partner of MGP, the general partner of and investment adviser to SSF Cayman and the investment adviser to SSF Private Equity. Austin W. Marxe and David M. Greenhouse are the principal owners of MGP and AWM. Through their control of MGP and AWM, Messrs. Marxe and Greenhouse share voting and investment control over the portfolio securities of each of the funds listed above. |
36
(10) | Consists of 565,820 shares of common stock of the Company held by Potomac Capital Partners LP and warrants to purchase 424,365 shares of common stock held by Potomac Capital Partners LP. Such securities are also included and reflected in the disclosure for Paul J. Solit, per footnote 11 below. | |
(11) | Consists of 565,820 shares of common stock of the Company held by Potomac Capital Partners LP and warrants to purchase 424,365 shares of common stock held by Potomac Capital Partners LP; 391,968 shares of common stock held by Potomac Capital International Ltd and warrants to purchase 293,976 shares of common stock held by Potomac Capital International Ltd; and 402,212 shares of common stock held by Pleiades Investment Partners-R LP (Pleiades) and warrants to purchase 301,659 shares of common stock held by Pleiades. Paul J. Solit has disposition and voting control for Potomac Capital Partners LP, Potomac Capital International Ltd. and Pleiades. | |
(12) | Consists of 791,200 shares of common stock of the Company held by Lagunitas Partners LP and warrants to purchase 593,400 shares of common stock held by Lagunitas Partners LP. Such securities are also included and reflected in the disclosure for Jon D. Gruber, per footnote 13 below. | |
(13) | Consists of 791,200 shares of common stock of the Company held by Lagunitas Partners LP and warrants to purchase 593,400 shares of common stock held by Lagunitas Partners LP; 181,600 shares of common stock held by Gruber & McBaine International and warrants to purchase 136,200 shares of common stock held by Gruber & McBaine International; 153,600 shares of common stock held by the Jon D. and Linda W. Gruber Trust and warrants to purchase 115,200 shares of common stock held by the Jon D. and Linda W. Gruber Trust. Jon D. Gruber has disposition and voting control for Lagunitas Partners, LP and Gruber & McBaine International, and Jon D. Gruber and Linda W. Gruber have disposition and voting control for the Jon D. and Linda W. Gruber Trust. |
37
38
2008 | 2007 | |||||||
Audit Fees
|
$ | 46,626 | $ | 40,847 | ||||
Audit Related Fees
|
$ | 3,111 | $ | 1,536 | ||||
Tax Fees
|
$ | 16,000 | -0- | |||||
All Other Fees
|
-0- | -0- |
39
REMEDENT, INC.
|
||||
Dated: July 11, 2008 | /s/ Robin List | |||
By: Robin List | ||||
Its: Chief Executive Officer (Principal
Executive Officer) and Director |
Dated: July 11, 2008 | /s/ Philippe Van Acker | |||
By: Philippe Van Acker | ||||
Its: Chief Financial Officer (Principal
Financial Officer and Principal Accounting Officer) |
||||
Dated: July 11, 2008 | /s/ Robin List | |||
Robin List Chief Executive Officer and Director | ||||
Dated: July 11, 2008 | /s/ Guy De Vreese | |||
Guy De Vreese Chairman of the Board of Directors | ||||
Dated: July 11, 2008 | /s/ Stephen Ross | |||
Stephen Ross Secretary and Director | ||||
Dated: July 11, 2008 | /s/ Fred Kolsteeg | |||
Fred Kolsteeg Director | ||||
40
Exhibit No | Description | |||
2.1 |
Stock Exchange Agreement with Resort World Enterprises, Inc. (1)
|
|||
|
||||
3.1 |
Articles of Incorporation of Jofran Confectioners International, Inc., a Nevada corporation,
dated July 31, 1986 (1)
|
|||
|
||||
3.2 |
Amendment to Articles of Incorporation changing name from Jofran Confectioners
International, Inc., a Nevada corporation, to Cliff Typographers, Inc., a Nevada
corporation, dated July 31, 1986 (1)
|
|||
|
||||
3.3 |
Amendment to Articles of Incorporation changing name from Cliff Typographers, Inc., a Nevada
corporation, to Cliff Graphics International, Inc., a Nevada corporation, dated January 9,
1987 (1)
|
|||
|
||||
3.4 |
Amendment to Articles of Incorporation changing name from Cliff Graphics International,
Inc., a Nevada corporation, to Global Golf Holdings, Inc., a Nevada corporation, dated March
8, 1995 (1)
|
|||
|
||||
3.5 |
Amendment to Articles of Incorporation changing name from Global Golf Holdings, Inc., a
Nevada corporation, to Dino Minichiello Fashions, Inc., a Nevada corporation, dated November
20, 1997 (1)
|
|||
|
||||
3.6 |
Amendment to Articles of Incorporation changing name from Dino Minichiello Fashions, Inc., a
Nevada corporation, to Resort World Enterprises, Inc., a Nevada corporation, dated August
18, 1998 (1)
|
|||
|
||||
3.7 |
Amendment to Articles of Incorporation changing name from Resort World Enterprises, Inc., a
Nevada corporation, to Remedent , Inc., dated October 5, 1998 (1)
|
|||
|
||||
3.8 |
Amended and Restated Articles of Incorporation changing name from Remedent, USA, Inc. to
Remedent, Inc. and to effect a one-for-twenty reverse stock split on June 3, 2005 (2)
|
|||
|
||||
3.9 |
Amended and Restated Bylaws (2)
|
|||
|
||||
4.1 |
Specimen of Stock Certificate (7)
|
|||
|
||||
4.2 |
Form of Subscription Agreement (5)
|
|||
|
||||
4.3 |
Form of Warrant for Common Stock (5)
|
|||
|
||||
4.4 |
Form of Registration Rights Agreement (5)
|
|||
|
||||
4.5 |
Form of Warrant for Unit (8)
|
|||
|
||||
4.6 |
Form of Warrant for Common Stock (17)
|
|||
|
||||
10.1 |
Incentive and Nonstatutory Stock Option Plan, dated May 29, 2001 (1)
|
|||
|
||||
10.2 |
2004 Incentive and Nonstatutory Stock Option Plan (8)
|
|||
|
||||
10.3 |
Exchange Agreement by and among Remedent, Inc. and Lausha, N.V. and Robin List dated June 3,
2005 (2)
|
|||
|
||||
10.4 |
Amendment to Line of Credit Agreement by and Between Remedent, N.V. and Fortis Bank dated
May 3, 2005, subject to General Terms and Conditions (6)
|
|||
|
||||
10.5 |
Exclusive License Agreement between Remedent, Inc. and Dan Darnell dated October 11, 2004 (6)
|
|||
|
||||
10.6 |
Amendment to Development Agreement between Remedent, Inc. and P. Michael Williams dated
August 4, 2004 (6)
|
|||
|
||||
10.7 |
Option Agreement between Remedent, N.V. and Lident NV dated July 6, 2004 (6)
|
|||
|
||||
10.8 |
Development Agreement between Remedent, Inc. and P. Michael Williams dated March 15, 2004 (6)
|
|||
|
||||
10.9 |
Convertible Promissory Note dated March 23, 2004 (3)
|
|||
|
||||
10.10 |
Letter Agreement by and between MDB Capital Group, Inc. and Remedent, Inc. dated September
22, 2003 (6)
|
|||
|
||||
10.11 |
Stock Purchase Agreement with Dental Advisors, dated September 14, 2001 (1)
|
|||
|
||||
10.12 |
Asset Purchase Agreement for IMDS, dated January 15, 2001 (1)
|
|||
|
||||
10.13 |
Stock Purchase Agreement, dated January 11, 2002 (1)
|
|||
|
||||
10.14 |
Stock Purchase Agreement, dated May 1, 2002 (1)
|
|||
|
||||
10.15 |
Securities Purchase Agreement dated July 6, 2005 (5)
|
|||
|
||||
10.16 |
Registration Rights Agreement dated July 6, 2005 (5)
|
|||
|
||||
10.17 |
Warrant dated July 6, 2005 (5)
|
|||
|
||||
10.18 |
Amendment to Warrant (8)
|
|||
|
||||
10.19 |
Employment Agreement between Remedent N.V. and Philippe Van Acker (7)
|
|||
|
||||
10.20 |
Agreement between Remedent N.V. and Omega Pharma NV dated as of September 9, 2003(8)
|
41
Exhibit No | Description | |||
10.21 |
Addendum to Distribution Agreement between Remedent N.V. and Omega Pharma NV dated September
24, 2003 (7)
|
|||
|
||||
10.22 |
Addendum to Distribution Agreement between Remedent N.V. and Omega Pharma NV dated February
4, 2004 (7)
|
|||
|
||||
10.23 |
Lease Agreement dated December 20, 2001 (7)
|
|||
|
||||
10.24 |
Consulting Agreement between Remedent, Inc., and P. Michael Williams dated February 10, 2006
(9)
|
|||
|
||||
10.25 |
Consulting Agreement between Remedent, Inc. and Pierre Fabre Medicament S.A. dated December
21, 2005 (10)
|
|||
|
||||
10.26 |
Agreement between Remedent N.V, and Chefaro Pharma Italia S.R.L. dated February 15, 2006 (11)
|
|||
|
||||
10.27 |
Exclusive License and Distribution Agreement between Remedent and Dream Life dated March 22,
2006 (12)
|
|||
|
||||
10.28 |
Employment Agreement between Remedent, Inc. and Judd D. Hoffman (8)
|
|||
|
||||
10.29 |
Employment Severance Agreement between Remedent, Inc. and Judd D. Hoffman (13)
|
|||
|
||||
10.30 |
Fortis Bank General Lending Conditions for Corporate Customers (General Terms and
Conditions) (14)
|
|||
|
||||
10.31 |
Line of Credit Agreement by and between Remedent, N.V. and Fortis Bank dated September 8,
2004, subject to the General Terms and Conditions (14)
|
|||
|
||||
10.32 |
Amendment to Line of Credit Agreement by and Between Remedent, N.V. and Fortis Bank dated
March 13, 2006, subject to the General Terms and Conditions (15)
|
|||
|
||||
10.33 |
Amendment to Line of Credit Agreement by and Between Remedent, N.V. and Fortis Bank dated
September 1, 2006, subject to the General Terms and Conditions (16)
|
|||
|
||||
10.34 |
Purchase Agreement between Remedent, Inc. and certain Investors, dated June 20, 2007 (17)
|
|||
|
||||
10.35 |
Registration Rights Agreement between Remedent, Inc. and certain Investors, dated June 20,
2007 (17)
|
|||
|
||||
10.36 |
Letter Agreement between Remedent, Inc. and Roger Leddington dated August 8, 2007 (18)
|
|||
|
||||
10.37 |
2007 Equity Incentive Plan (19)
|
|||
|
||||
10.38 |
Sales and Distribution Agreement between Remedent N.V. and Savant Distribution Limited,
dated October 1, 2007 (20)
|
|||
|
||||
10.39 |
Waiver Agreement between Remedent, Inc. and Consenting Holders, dated October 18, 2007 (21)
|
|||
|
||||
10.40 |
Limited Liability Company Merger and Reallocation Agreement between Remedent NV and IMDS,
LLC, dated July 15, 2007 (22)
|
|||
|
||||
10.41 |
Distribution Agreement, dated November 29, 2007, by and between Remedent, Inc. and Vemedia
N.V. (23)
|
|||
|
||||
10.42 |
Distribution Agreement, dated April 10, 2008, by and between Remedent N.V. and GlamTech USA,
Inc. (24)
|
|||
|
||||
10.43 |
Factoring Agreement between Remedent, Inc. and First Community Financial, a division of
Pacific Western Bank, dated April 24, 2008 (25)
|
|||
|
||||
14.1 |
Code of Ethics, adopted March 25, 2003 (4)
|
|||
|
||||
21.1 |
List of Subsidiaries*
|
|||
|
||||
23.1 |
Consent of PKF Bedrijfsrevisoren, Antwerp, Belgium*
|
|||
|
||||
31.1 |
Certifications of the Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act.*
|
|||
|
||||
31.2 |
Certifications of the Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act.*
|
|||
|
||||
32.1 |
Certifications of the Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act.*
|
|||
|
||||
32.2 |
Certifications of the Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act.*
|
* | Filed herewith. | |
(1) | Incorporated by reference from Registration Statement on Form SB-2 filed with the SEC on July 24, 2002. | |
(2) | Incorporated by reference from Form 8-K filed with the SEC on June 8, 2005. | |
(3) | Incorporated by reference from Form 10-KSB/A filed with the SEC on February 8, 2005. | |
(4) | Incorporated by reference from Form 10-KSB filed with the SEC on July 15, 2003. |
42
(5) | Incorporated by reference from Form 8-K filed with the SEC on July 11, 2005. | |
(6) | Incorporated by reference from Form 10-KSB filed with the SEC on July 14, 2005. | |
(7) | Incorporated by reference from Form SB-2 filed with the SEC on August 4, 2005. | |
(8) | Incorporated by reference from Form SB-2/A filed with the SEC on October 26, 2005 | |
(9) | Incorporated by reference from Form 8-K filed with the SEC on February 16, 2006. | |
(10) | Incorporated by reference from Form 10-QSB filed with the SEC on February 21, 2006. | |
(11) | Incorporated by reference from Form 8-K filed with the SEC on February 22, 2006. | |
(12) | Incorporated by reference from Original Filing on Form 10-KSB filed with the SEC on July 14, 2006. | |
(13) | Incorporated by reference from Form 10-QSB filed with the SEC on August 21, 2006. | |
(14) | Incorporated by reference from Form 10-KSB/A2 filed with the SEC on June 11, 2007. | |
(15) | Incorporated by reference from Form 10-KSB/A filed with the SEC on June 11, 2007. | |
(16) | Incorporated by reference from Form 10-QSB/A filed with the SEC on June 11, 2007. | |
(17) | Incorporated by reference from Form 8-K filed with the SEC on June 27, 2007. | |
(18) | Incorporated by reference from Form 8-K filed with the SEC on August 15, 2007 | |
(19) | Incorporated by reference from Schedule 14A filed with the SEC on October 2, 2007 | |
(20) | Incorporated by reference from Form SB-2/A3 filed with the SEC on October 23, 2007 | |
(21) | Incorporated by reference from Form SB-2/A2 filed with the SEC on October 19, 2007 | |
(22) | Incorporated by reference from Form 10-QSB filed with the SEC on November 19, 2007 | |
(23) | Incorporated by reference from Form 8-K filed with the SEC on December 19, 2007 | |
(24) | Incorporated by reference from Form 8-K filed with the SEC on April 15, 2008 | |
(25) | Incorporated by reference from Form 8-K filed with the SEC on April 30, 2008 |
43
F-1 | ||||
F-2 | ||||
F-3 | ||||
F-4 | ||||
F-5 | ||||
F-6 | ||||
F-7 |
44
/s/ Ria Verheyen | ||||
Registered Auditor | ||||
F-1
March 31, 2008 | March 31, 2007 | |||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$ | 1,728,281 | $ | 126,966 | ||||
Accounts receivable, net of allowance for doubtful accounts of $32,181 at March 31,
2008 and $79,996 at March 31, 2007
|
1,902,920 | 1,724,121 | ||||||
Inventories, net
|
1,360,709 | 1,132,941 | ||||||
Prepaid expense
|
970,173 | 668,421 | ||||||
Total current assets
|
5,962,083 | 3,652,449 | ||||||
PROPERTY AND EQUIPMENT, NET
|
692,609 | 589,623 | ||||||
OTHER ASSETS
|
||||||||
Long term investments and advances
|
675,000 | | ||||||
Patents, net
|
115,827 | 135,894 | ||||||
TOTAL ASSETS
|
$ | 7,445,519 | $ | 4,377,966 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Current portion, long term debt
|
$ | 58,583 | $ | 43,499 | ||||
Line of Credit
|
779,718 | 1,530,276 | ||||||
Notes payable
|
| 11,282 | ||||||
Accounts payable
|
2,002,439 | 1,441,502 | ||||||
Accrued liabilities
|
781,737 | 412,435 | ||||||
Due to related parties
|
| 50,536 | ||||||
Income taxes payable
|
15,121 | | ||||||
Total current liabilities
|
3,637,598 | 3,489,530 | ||||||
LONG TERM DEBT
|
94,754 | 152,343 | ||||||
STOCKHOLDERS DEFICIT:
|
||||||||
Preferred Stock $0.001 par value (10,000,000 shares authorized, none issued and
outstanding)
|
| | ||||||
Common stock, $0.001 par value; (50,000,000 shares authorized, 18,637,803 shares
issued and outstanding at March 31, 2008 and 12,996,245 shares issued and
outstanding at March 31, 2007)
|
18,638 | 12,996 | ||||||
Additional paid-in capital
|
17,929,992 | 11,904,000 | ||||||
Accumulated deficit
|
(14,263,113 | ) | (11,147,600 | ) | ||||
Accumulated other comprehensive income (loss) (foreign currency translation adjustment)
|
27,650 | (33,303 | ) | |||||
Total stockholders equity (deficit)
|
3,713,167 | 736,093 | ||||||
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)
|
$ | 7,445,519 | $ | 4,377,966 | ||||
F-2
For the years ended | ||||||||
March 31, | ||||||||
2008 | 2007 | |||||||
Net sales
|
$ | 7,482,261 | $ | 6,676,365 | ||||
Cost of sales
|
3,975,777 | 3,342,716 | ||||||
Gross profit
|
3,506,484 | 3,333,649 | ||||||
Operating Expenses
|
||||||||
Research and development
|
332,958 | 341,764 | ||||||
Sales and marketing
|
1,886,389 | 888,810 | ||||||
General and administrative
|
4,057,007 | 3,288,723 | ||||||
Depreciation and amortization
|
301,260 | 209,340 | ||||||
TOTAL OPERATING EXPENSES
|
6,577,614 | 4,728,637 | ||||||
INCOME (LOSS) FROM OPERATIONS
|
(3,071,130 | ) | (1,394,988 | ) | ||||
OTHER INCOME (EXPENSES)
|
||||||||
Interest expense
|
(138,168 | ) | (176,344 | ) | ||||
Other income
|
121,032 | 75,283 | ||||||
TOTAL OTHER INCOME (EXPENSES)
|
(17,136 | ) | (101,061 | ) | ||||
INCOME (LOSS) BEFORE INCOME TAXES
|
(3,088,266 | ) | (1,496,049 | ) | ||||
Income tax (expense) benefit
|
(27,247 | ) | | |||||
NET LOSS
|
$ | (3,115,513 | ) | $ | (1,496,049 | ) | ||
LOSS PER SHARE
|
||||||||
Basic and fully diluted
|
$ | (0.17 | ) | $ | (0.12 | ) | ||
WEIGHTED AVERAGE SHARES OUTSTANDING
|
||||||||
Basic and fully diluted
|
17,823,012 | 12,971,795 | ||||||
F-3
Additional | ||||||||||||||||||||||||||||
Paid in | Accumulated | Common Stock | ||||||||||||||||||||||||||
Shares | Amount | Capital | Deficit | Subscribed | Other | Total | ||||||||||||||||||||||
$ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Balance, March 31, 2006
|
12,764,112 | 12,764 | 11,624,234 | (9,651,551 | ) | 200 | (28,274 | ) | 1,957,373 | |||||||||||||||||||
|
||||||||||||||||||||||||||||
Common stock issued for development services
|
200,000 | 200 | | | (200 | ) | | | ||||||||||||||||||||
Common stock issued on conversion of convertible debentures
|
32,133 | 32 | 57,807 | | | | 57,839 | |||||||||||||||||||||
Value of stock options issued to employees
|
| | 221,959 | | | | 221,959 | |||||||||||||||||||||
Cumulative translation adjustment
|
| | | | | (5,029 | ) | (5,029 | ) | |||||||||||||||||||
Net loss
|
| | | (1,496,049 | ) | | | (1,496,049 | ) | |||||||||||||||||||
Balance, March 31, 2007
|
12,996,245 | 12,996 | 11,904,000 | (11,147,600 | ) | | (33,303 | ) | 736,093 | |||||||||||||||||||
|
||||||||||||||||||||||||||||
Common stock issued by private placement
|
5,600,000 | 5,600 | 6,994,400 | | | | 7,000,000 | |||||||||||||||||||||
Commissions and other costs of private placement
|
| | (1,224,498 | ) | | | | (1,224,498 | ) | |||||||||||||||||||
Shares issued on exercise of warrants
|
10,000 | 10 | 15,890 | | | | 15,900 | |||||||||||||||||||||
Shares issued Debt Conversion
|
31,558 | 32 | 50,504 | | | | 50,536 | |||||||||||||||||||||
Value of stock options issued to employees
|
| | 189,696 | | | | 189,696 | |||||||||||||||||||||
Cumulative translation adjustment
|
| | | | | 60,953 | 60,953 | |||||||||||||||||||||
Net loss
|
| | | (3,115,513 | ) | | | (3,115,513 | ) | |||||||||||||||||||
|
||||||||||||||||||||||||||||
Balance, March 31, 2008
|
18,637,803 | 18,638 | 17,929,992 | (14,263,113 | ) | | 27,650 | 3,713,167 | ||||||||||||||||||||
F-4
For the year ended March 31, | ||||||||
2008 | 2007 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||||||
Net loss
|
$ | (3,115,513 | ) | $ | (1,496,049 | ) | ||
Adjustments to reconcile net (loss) to net cash used by operating activities
|
||||||||
Depreciation and amortization
|
301,260 | 209,340 | ||||||
Inventory reserve
|
2,446 | | ||||||
Allowance for doubtful accounts
|
(47,815 | ) | (1,813 | ) | ||||
Stock issued upon conversion of convertible debentures
|
| 25,706 | ||||||
Value of issued stock options to employees
|
189,696 | 221,959 | ||||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
(178,799 | ) | 870,014 | |||||
Inventories
|
(227,768 | ) | 476,814 | |||||
Prepaid expenses
|
(301,752 | ) | (297,844 | ) | ||||
Accounts payable
|
548,811 | (336,606 | ) | |||||
Accrued liabilities
|
369,302 | (220,360 | ) | |||||
Income taxes payable
|
15,121 | (110,468 | ) | |||||
Net cash used by operating activities
|
(2,445,011 | ) | (659,307 | ) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES
|
||||||||
Decrease (increase) in restricted cash
|
| 70,762 | ||||||
Long term investments and advances
|
(675,000 | ) | | |||||
Purchase of patent rights
|
(11,556 | ) | | |||||
Purchases of equipment
|
(198,994 | ) | (385,866 | ) | ||||
Net cash used by investing activities
|
(885,550 | ) | (315,104 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||||||
Net proceeds from share issuances
|
5,791,402 | | ||||||
Net proceeds from (repayments of) capital lease note payable
|
(42,505 | ) | 111,231 | |||||
Note payments related parties
|
(0 | ) | (8,422 | ) | ||||
Proceeds from (repayments of) line of credit
|
(750,558 | ) | 837,180 | |||||
Net cash provided by financing activities
|
4,998,339 | 939,988 | ||||||
NET (DECREASE) INCREASE IN CASH
|
1,667,778 | (34,423 | ) | |||||
Effect of exchange rate changes on cash and cash equivalents
|
(66,463 | ) | (170,756 | ) | ||||
CASH AND CASH EQUIVALENTS, BEGINNING
|
126,966 | 332,145 | ||||||
CASH AND CASH EQUIVALENTS, ENDING
|
$ | 1,728,281 | $ | 126,966 | ||||
|
||||||||
Supplemental Cash Flow Information
:
|
||||||||
Interest paid
|
$ | 62,073 | $ | 111,493 | ||||
Income taxes paid
|
$ | | $ | | ||||
|
||||||||
SUPPLMENTAL NON-CASH FINANCING AND INVESTING ACTIVITIES:
|
||||||||
Common shares issued upon conversion of convertible debt
|
$ | 50,536 | $ | | ||||
F-5
For the year ended | ||||||||
March 31, | ||||||||
2008 | 2007 | |||||||
Net Loss
|
$ | (3,115,513 | ) | $ | (1,496,049 | ) | ||
OTHER COMPREHENSIVE LOSS:
|
||||||||
Foreign currency translation adjustment
|
60,953 | (5,029 | ) | |||||
Comprehensive loss
|
$ | (3,054,560 | ) | $ | (1,501,078 | ) | ||
F-6
1. | BACKGROUND AND ORGANIZATION | |
The Company is a manufacturer and distributor of cosmetic dentistry products, including a full line of professional dental and retail Over-The-Counter tooth whitening products which are distributed in Europe, and recently in Asia and the United States. The Company manufactures many of its products in its facility in Deurle, Belgium as well as outsourced manufacturing in China. The Company distributes its products using both its own internal sales force and through the use of third party distributors. | ||
The accompanying consolidated financial statements include the accounts of Remedent, Inc. (formerly Remedent USA, Inc.), a Nevada corporation, and its four subsidiaries, Remedent N.V. (Belgian corporation) located in Deurle, Belgium, Remedent Professional, Inc. (incorporated in California) and a subsidiary of Remedent Professional Holdings, Inc., Remedent Asia Pte Ltd, a wholly-owned subsidiary formed under the laws of Singapore, and Sylphar N.V. (incorporated in Belgium as a wholly owned subsidiary on September 24, 2007) (collectively, the Company). Remedent, Inc. is a holding company with headquarters in Deurle, Belgium and, as of October 2005, offices in Los Angeles, California. Remedent Professional, Inc. and Remedent Professional Holdings, Inc. have been dormant since inception. Remedent Asia Pte. Ltd., commenced operations as of July 2005. All significant inter-company accounts and transactions have been eliminated in the consolidated financial statements. | ||
The Company was originally incorporated under the laws of Arizona in September 1996 under the name Remedent USA, Inc. In October 1998, the Company was acquired by Resort World Enterprises, Inc., a Nevada corporation (RWE) in a share exchange and RWE immediately changed its name to Remedent USA, Inc. The share exchange was a reverse acquisition and accounted for as if the Company acquired RWE and then recapitalized its capital structure. On July 1, 2001, the Company formed three wholly-owned subsidiaries, Remedent Professional Holdings, Inc., Remedent Professional, Inc. and Remedent N.V. (a Belgium corporation). Remedent Professional, Inc. and Remedent Professional Holdings, Inc. are both wholly-owned subsidiaries and have been inactive since inception. In June 2005, the Company formed Remedent Asia Pte Ltd, a wholly-owned subsidiary formed under the laws of Singapore. In October, 2005, the Company established a sales office in Los Angeles, California in order to introduce its products to the United States market. | ||
During the quarter ended March 31, 2002, through the Companys Belgium based subsidiary, Remedent N.V., the Company initiated its entrance into the high technology dental equipment market. Since that time, the majority of the Companys operations have been conducted through its subsidiary, Remedent N.V. For the last five fiscal years, substantially all of the Companys revenue has been generated by Remedent N.V., which has become a provider of cosmetic dentistry products, including a full line of professional dental and retail over-the-counter tooth whitening products in Europe. Because the controlling stockholders of Remedent N.V. consisted of the Companys executive officers or companies owned by these executive officers, the Company has always had effective control over Remedent N.V., as defined by APB 51 Consolidated Financial Statements , even though it owned only twenty two percent (22%) of this subsidiary. | ||
On June 3, 2005, the Company consummated the acquisition of the remaining 78% of Remedent N.V., and issued 7,715,703 shares of the Companys common stock in exchange for the 78% of the common stock of Remedent N.V. not owned by the Company. As a result of this acquisition, Remedent N.V. is now our wholly-owned subsidiary. | ||
In addition, on June 3, 2005, the Company amended its Articles of Incorporation pursuant to the filing of the Amended and Restated Articles of Incorporation with the Nevada Secretary of State. The Amended and Restated Articles of Incorporation (i) changed the name of the Company from Remedent USA, Inc. to Remedent, Inc. (ii) increased the number of authorized shares to 60,000,000 shares consisting of 50,000,000 shares of common stock and 10,000,000 shares of Preferred Stock, and (iii) effected a one-for-twenty reverse stock split (collectively, the Amendments). The consolidated financial statements and accompanying notes have been retroactively adjusted to reflect the effects of the reverse split and authorization of 10,000,000 shares of Preferred Stock. |
F-7
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Organization and Principles of Consolidation | ||
The accompanying consolidated financial statements include the accounts of Remedent, Inc. (formerly Remedent USA, Inc.), a Nevada corporation, and its four subsidiaries, Remedent N.V. (Belgian corporation) located in Deurle, Belgium, Remedent Professional, Inc. (incorporated in California) and a subsidiary of Remedent Professional Holdings, Inc., Remedent Asia Pte. Ltd, a wholly-owned subsidiary formed under the laws of Singapore, and Sylphar N.V. (incorporated in Belgium as a wholly owned subsidiary on September 24, 2007), (collectively, the Company). Remedent, Inc. is a holding company with headquarters in Deurle, Belgium. Remedent Professional, Inc. and Remedent Professional Holdings, Inc. have been dormant since inception. Remedent Asia Pte. Ltd., commenced operations as of July 2005. All significant inter-company accounts and transactions have been eliminated in the consolidated financial statements. Corporate administrative costs are not allocated to subsidiaries. | ||
Basis of Presentation | ||
The Companys financial statements have been prepared on an accrual basis of accounting, in conformity with accounting principles generally accepted in the United States of America. These principles contemplate the realization of assets and liquidation of liabilities in the normal course of business. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. These financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. | ||
Revenue Recognition | ||
The Company recognizes revenue from product sales when persuasive evidence of a sale exists: that is, a product is shipped under an agreement with a customer; risk of loss and title has passed to the customer; the fee is fixed or determinable; and collection of the resulting receivable is reasonably assured. Sales allowances are estimated based upon historical experience of sales returns. | ||
Impairment of Long-Lived Assets | ||
Long-lived assets consist primarily of patents and property and equipment. The recoverability of long-lived assets is evaluated by an analysis of operating results and consideration of other significant events or changes in the business environment. If impairment exists, the carrying amount of the long-lived assets is reduced to its estimated fair value, less any costs associated with the final settlement. As of March 31, 2008, management believes there was no impairment of the Companys long-lived assets. | ||
Pervasiveness of Estimates | ||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, the Company evaluates estimates and judgments, including those related to revenue, bad debts, inventories, fixed assets, intangible assets, stock based compensation, income taxes, and contingencies. Estimates are based on historical experience and on various other assumptions that the Company believes reasonable in the circumstances. The results form the basis for making judgments about the carrying vales of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. |
F-8
Cash and Cash Equivalents | ||
The Company considers all highly liquid investments with maturities of three months or less to be cash or cash equivalents. | ||
Accounts Receivable and Allowance for Doubtful Accounts | ||
The Company sells professional dental equipment to various companies, primarily to distributors located in Western Europe. The terms of sales vary by customer, however, generally are 2% 10 days, net 30 days. Accounts receivable is reported at net realizable value and net of allowance for doubtful accounts. The Company uses the allowance method to account for uncollectible accounts receivable. The Companys estimate is based on historical collection experience and a review of the current status of trade accounts receivable. | ||
Inventories | ||
The Company purchases certain of its products in components that require assembly prior to shipment to customers. All other products are purchased as finished goods ready to ship to customers. | ||
The Company writes down inventories for estimated obsolescence to estimated market value based upon assumptions about future demand and market conditions. If actual market conditions are less favorable than those projected, then additional inventory write-downs may be required. Inventory reserves for obsolescence totaled $15,812 at March 31, 2008 and $13,366 at March 31, 2007. | ||
Prepaid Expense | ||
The Companys prepaid expense consists of prepayments to suppliers for inventory purchases and to the Belgium customs department, to obtain an exemption of direct VAT payments for imported goods out of the European Union (EU). This prepayment serves as a guarantee to obtain the facility to pay VAT at the moment of sale and not at the moment of importing goods at the border. Prepaid expenses also include VAT payments made for goods and services in excess of VAT payments received from the sale of products as well as amounts for other prepaid operating expenses. | ||
Property and Equipment | ||
Property and equipment are stated at cost. Major renewals and improvements are charged to the asset accounts while replacements, maintenance and repairs, which do not improve or extend the lives of the respective assets, are expensed. At the time property and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation accounts are relieved of the applicable amounts. Gains or losses from retirements or sales are credited or charged to income. | ||
The Company depreciates its property and equipment for financial reporting purposes using the straight-line method based upon the following useful lives of the assets: |
Tooling
|
3 Years | |||
Furniture and fixtures
|
4 Years | |||
Machinery and Equipment
|
4 Years |
Patents | ||
Patents consist of the costs incurred to purchase patent rights and are reported net of accumulated amortization. Patents are amortized using the straight-line method over a period based on their contractual lives. | ||
Research and Development Costs | ||
The Company expenses research and development costs as incurred. |
F-9
Advertising | ||
Costs incurred for producing and communicating advertising are expensed when incurred and included in sales and marketing and general and administrative expenses. For the years ended March 31, 2008 and March 31, 2007, advertising expense was $395,964 and $350,793, respectively. | ||
Income taxes | ||
Income taxes are provided in accordance with Statement of Financial Accounting Standards No. 109 (SFAS 109), Accounting for Income Taxes. Deferred taxes are recognized for temporary differences in the bases of assets and liabilities for financial statement and income tax reporting as well as for operating losses and credit carry forwards. A provision has been made for income taxes due on taxable income and for the deferred taxes on the temporary differences. The components of the deferred tax asset and liability are individually classified as current and non-current based on their characteristics. | ||
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. | ||
Warranties | ||
The Company typically warrants its products against defects in material and workmanship for a period of 18 months from shipment. Based upon historical trends and warranties provided by the Companys suppliers and sub-contractors, the Company has made a provision for warranty costs of $23,718 and $20,049 as of March 31, 2008 and March 31, 2007, respectively. | ||
Segment Reporting | ||
Statement of Financial Accounting Standards No. 131 (SFAS 131), Disclosure About Segments of an Enterprise and Related Information requires use of the management approach model for segment reporting. The management approach model is based on the way a companys management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. The Companys management considers its business to comprise one segment for reporting purposes. | ||
Computation of Earnings (Loss) per Share | ||
Basic net income (loss) per common share is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Net income (loss) per common share attributable to common stockholders assuming dilution is computed by dividing net income by the weighted average number of shares of common stock outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued. Potential common shares related to stock options and stock warrants are excluded from the computation when their effect is anti-dilutive. |
F-10
Conversion of Foreign Currencies | ||
The reporting currency for the consolidated financial statements of the Company is the U.S. dollar. The functional currency for the Companys European subsidiaries, Remedent N.V. and Sylphar N.V., is the Euro, for Remedent Asia the Singapore Dollar. Finally, the functional currency for Remedent Professional, Inc. is the U.S. dollar. The Company translates foreign currency statements to the reporting currency in accordance with FASB 52. The assets and liabilities of companies whose functional currency is other that the U.S. dollar are included in the consolidation by translating the assets and liabilities at the exchange rates applicable at the end of the reporting period. The statements of income of such companies are translated at the average exchange rates during the applicable period. Translation gains or losses are accumulated as a separate component of stockholders equity. | ||
Comprehensive Income (Loss) | ||
The Company has adopted the provisions of Statement of Financial Accounting Standards No. 130, Reporting Comprehensive Income (SFAS No. 130). SFAS No. 130 establishes standards for the reporting and display of comprehensive income, its components and accumulated balances in a full set of general purpose financial statements. SFAS No. 130 defines comprehensive income (loss) to include all changes in equity except those resulting from investments by owners and distributions to owners, including adjustments to minimum pension liabilities, accumulated foreign currency translation, and unrealized gains or losses on marketable securities. | ||
The Companys only component of other comprehensive income is the accumulated foreign currency translation consisting of gains and (losses) of $60,953 and $(5,029) for the years ended March 31, 2008 and 2007, respectively. These amounts have been recorded as a separate component of stockholders equity (deficit). | ||
Stock Based Compensation | ||
In December 2004, the Financial Accounting Standards Board issued SFAS No. 123R, Share-Based Payment. Subsequently, the Securities and Exchange Commission (SEC) provided for a phase-in implementation process for SFAS No. 123R, which required adoption of the new accounting standard no later than January 1, 2006. SFAS No. 123R requires accounting for stock options using a fair-value-based method as described in such statement and recognize the resulting compensation expense in the Companys financial statements. Prior to April 1, 2006, the Company accounted for employee stock options using the intrinsic value method under APB No. 25, Accounting for Stock Issued to Employees and related Interpretations, which generally resulted in no employee stock option expense. The Company adopted SFAS No. 123R on April 1, 2006 and does not plan to restate financial statements for prior periods. The Company plans to continue to use the Black-Scholes option valuation model in estimating the fair value of the stock option awards issued under SFAS No. 123R. The adoption of SFAS No. 123R has a material impact on the Companys results of operations. For the years ended March 31, 2008 and March 31, 2007, equity compensation in the form of stock options and grants of restricted stock totaled $189,696 and $221,959 respectively. | ||
Adoption of New Accounting Policies | ||
Effective April 1, 2006, the Company adopted the provisions of the FASB Staff Position ( FSP 8 ) on EITF Issue 00-19-2 Accounting for Registration Payment Arrangements . This accounting position was adopted on a prospective basis with no restatement of prior period consolidated financial statements. This position specifies that the contingent obligation to make future payments or otherwise transfer consideration under a registration payment arrangement, whether issued as a separate agreement or included as a provision of a financial instrument or other agreement, should be separately recognized and measured in accordance with FASB Statement No. 5 Accounting for Contingencies. Transition to the FSP will be achieved by reporting a change in accounting principle through a cumulative-effect adjustment to the opening balance of deficit. | ||
The Company adopted FASB Interpretation No.48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statements No. 109 (FIN 48) on April 1, 2006. FIN 48 clarifies the accounting for uncertainty in income taxes by prescribing a two-step method of first evaluating whether a tax position has met a more likely than not recognition threshold and second, measuring that tax position to determine the amount of |
F-11
benefit to be recognized in the financial statements. FIN 48 provides guidance on the presentation of such positions within a classified statement of financial position as well as on derecognition, interest and penalties, accounting in interim periods, disclosure, and transition. The adoption of this statement did result in a cumulative adjustment to equity and there were no unrecognized tax benefits, penalties or interest at the time of, or subsequent to, adoption. | ||
Recent Accounting Pronouncements | ||
In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities . This statement changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, and its related interpretations, and (c) how derivative instruments and related hedged items affect an entitys financial position, financial performance, and cash flows. This statement is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008 (the Companys fiscal year beginning April 1, 2009), with early application encouraged. This statement encourages, but does not require, comparative disclosures for earlier periods at initial adoption. Management is in the process of evaluating the impact the future application of this pronouncement may have on its consolidated financial statements. | ||
In December 2007, the FASB issued SFAS No. 141 (Revised 2007) Business Combinations . SFAS 141 (Revised) establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree. The statement also provides guidance for recognizing and measuring the goodwill acquired in the business combination and determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. The guidance will become effective for the Companys fiscal year beginning April 1, 2009. Management is in the process of evaluating the impact SFAS 141 (Revised) will have on the Companys financial statements upon adoption. | ||
In December 2007, the FASB issued SFAS No. 160 Noncontrolling Interests in Consolidated Financial Statements an amendment of ARB No. 51 . SFAS 160 establishes accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. The guidance will become effective for the Companys fiscal year beginning April 1, 2009. Management is in the process of evaluating the impact SFAS 160 will have on the Companys financial statements upon adoption. | ||
In February 2007, the Financial Accounting Standards Board (FASB) issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities Including an Amendment of FASB Statement No. 115 . This statement permits entities to choose to measure many financial instruments and certain other items at fair value. Most of the provisions of SFAS No. 159 apply only to entities that elect the fair value option. However, the amendment to SFAS No. 115 Accounting for Certain Investments in Debt and Equity Securities applies to all entities with available-for-sale and trading securities. SFAS No. 159 is effective for the Companys fiscal year beginning April 1, 2008. The Company adopted SFAS No. 159 on April 1, 2008, with no financial statement impact. | ||
In September 2006, the FASB issued SFAS Statement No. 158, Employers Accounting for Defined Benefit Pension and Other Postretirement Plans . This new standard will require employers to fully recognize the obligations associated with single-employer defined benefit pension, retiree healthcare and other postretirement plans in their financial statements. The Company adopted SFAS No. 158 on April 1, 2007, resulting in no financial statement impact since the Company currently does not sponsor the defined benefit pension or postretirement plans within the scope of the standard. | ||
In September 2006, FASB issued SFAS No. 157, Fair Value Measurements (SFAS 157). The objective of SFAS 157 is to increase consistency and comparability in fair value measurements and to expand disclosures about fair value measurements. SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS 157 applies under other accounting pronouncements that require or permit fair value measurements and does not |
F-12
require any new fair value measurements. The provisions of SFAS 157 are effective for fair value measurements made in the Companys fiscal years beginning April 1, 2008. The Company has not determined the effect, if any, that the adoption of SFAS 157 will have on the Companys consolidated financial position or results of operations. | ||
In March 2006, the FASB issued SFAS No. 156, Accounting for Servicing of Financial Assets . This statement amends SFAS 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, a replacement of FASB Statement 125, or SFAS 140, regarding (1) the circumstances under which a servicing asset or servicing liability must be recognized, (2) the initial and subsequent measurement of recognized servicing assets and liabilities, and (3) information required to be disclosed relating to servicing assets and liabilities. The Company adopted this standard on April 1, 2007, with no impact on its consolidated financial statements. | ||
In February 2006, the FASB issued SFAS No. 155, Accounting for Certain Hybrid Financial Instruments , or SFAS 155. This statement amends SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities , to narrow the scope exception for interest-only and principal-only strips on debt instruments to include only such strips representing rights to receive a specified portion of the contractual interest or principal cash flows. SFAS 155 also amends SFAS 140 to allow qualifying special-purpose entities to hold a passive derivative financial instrument pertaining to beneficial interests that itself is a derivative financial instrument. The Company adopted this standard on April 1, 2007, with no impact on its consolidated financial statements. | ||
EITF No. 07-3, Accounting for Nonrefundable Advance Payments for Goods or Services Received for Use in Future Research and Development Activities , was issued in June 2007. The EITF reached a consensus that nonrefundable payments for goods and services that will be used or rendered for future research and development activities should be deferred and capitalized. Such amounts should be recognized as an expense as the related goods are delivered and the related services are performed. Entities should continue to evaluate whether they expect the goods to be delivered or services to be rendered. If the entity does not expect the goods to be delivered or services to be rendered, the capitalized advance payment should be charged to expense. This pronouncement is effective for financial statements issued for fiscal years beginning after December 15, 2007 (the Companys fiscal year beginning April 1, 2008) and interim periods within those fiscal years. Earlier application is not permitted. Entities are required to report the effects of applying this pronouncement prospectively for new contracts entered into on or after the effective date of this pronouncement. The Company currently is not a party to research and development arrangements that include nonrefundable advance payments. To the extent that the Company enters into research and development arrangements in the future that include nonrefundable advance payments, the future application of this pronouncement may have a material effect on its financial condition and results of operations. | ||
3. | PRIVATE PLACEMENT | |
On June 25, 2007, the Company completed its private offering of 5,600,000 shares of its common stock, par value $.001 per share at a purchase price of $1.25 per share (the Shares) and warrants to purchase 4,200,000 shares of common stock, par value $.001 per share, at an exercise price of $1.55 per share (the Warrants) to certain institutional and accredited investors, for an aggregate purchase price of $7,000,000 (the Offering). | ||
Under the terms of the Offering, the Warrants are exercisable for a period of five years and entitle the holder to purchase one share of restricted common stock (the Warrant Shares) for $1.55 per Warrant Share. The Company also has the right to redeem the Warrants for $0.001 per Warrant Share covered by the Warrants if the Shares trade on the OTC Electronic Bulletin Board or similar market above $5.25 per share for 20 consecutive trading days following the initial effective date of the registration statement covering the resale of the Shares and Warrant Shares, based upon the closing bid price for the Shares for each trading day (the Redemption Right). Once the Redemption Right vests, the Company has the right, but not the obligation, to redeem the Warrants for $0.001 per Warrant Share covered by the Warrants upon 30 days written notice to the holders of the Warrants. | ||
Under the terms of the Purchase Agreement and the Registration Rights Agreement, the Company was required to prepare and file with the Securities and Exchange Commission (the Commission) a registration statement covering the resale of the Shares and the Warrant Shares. The Company agreed to prepare and file a registration statement covering the resale no later than 30 days after the Closing. The registration statement became effective October 23, 2007. |
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The Company engaged Roth Capital Partners, LLC, as its exclusive agent to offer the Shares and Warrants (the Placement Agent). The Placement Agent is entitled to a fee equal to ten percent (10%) of the gross proceeds derived from the Offering, of which the Placement Agent may, at its option, receive up to 2% of its 10% fee in securities issued in the Offering. Further, the Company agreed to pay the Placement Agent 5% of the exercise price of the Warrants promptly following the Companys receipt thereof. In addition, the Company agreed to reimburse the Placement Agent for its out-of-pocket expenses related to the Offering, including an up front payment of $25,000 to cover such expenses, of which any unused amount will be netted against the Placement Agents 10% fee. | ||
As of March 31, 2008, the total costs of this private placement were $1,224,498, comprising of: commissions of $762,505; out-of-pocket costs of $25,000; professional fees of $365,013 and direct travel costs of $71,980; and have been recorded against share capital as a cost of financing. | ||
The Offering was conducted in reliance upon an exemption from registration under the Securities Act of 1933, as amended (the Securities Act), including, without limitation, that under Section 506 of Regulation D promulgated under the Securities Act. The Units were offered and sold by the Company to accredited investors in reliance on Section 506 of Regulation D of the Securities Act of 1933, as amended. | ||
4. | CONCENTRATION OF RISK | |
Financial Instruments Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of trade accounts receivable. | ||
Concentrations of credit risk with respect to trade receivables are normally limited due to the number of customers comprising the Companys customer base and their dispersion across different geographic areas. At March 31, 2008 two customers accounted for 25% and 10% of the Companys trade accounts receivable. At March 31, 2007, two customers accounted for 35% and 10% of the Companys trade accounts receivable. The Company performs ongoing credit evaluations of its customers and normally does not require collateral to support accounts receivable. | ||
Purchases The Company has diversified its sources for product components and finished goods and, as a result, the loss of a supplier would not have a material impact on the Companys operations. For the year ended March 31, 2008, the Company had one supplier who accounted for 33% of gross purchases and four other suppliers who accounted for between 14% and 21% of gross purchases each. For the year ended March 31, 2007, the Company had one supplier who accounted for 28% of gross purchases and four other suppliers who accounted for between 10% and 20% of gross purchases each. | ||
Revenues For the year ended March 31, 2008 the Company had one customer that accounted for 16% of total revenues. For the year ended March 31, 2007 the Company had two customers that accounted for 35% and 10% respectively, of total revenues. |
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5. | ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
The Companys accounts receivable at year end were as follows: |
March 31, 2008 | March 31, 2007 | |||||||
Accounts receivable, gross
|
$ | 1,935,101 | $ | 1,804,117 | ||||
Less: allowance for doubtful accounts
|
(32,181 | ) | (79,996 | ) | ||||
Accounts receivable, net
|
$ | 1,902,920 | $ | 1,724,121 | ||||
6. | INVENTORIES | |
Inventories at year end are stated at the lower of cost (first-in, first-out) or net realizable value and consisted of the following: |
March 31, 2008 | March 31, 2007 | |||||||
Raw materials
|
$ | 29,788 | $ | 30,579 | ||||
Components
|
970,101 | 786,728 | ||||||
Finished goods
|
376,632 | 329,000 | ||||||
|
1,376,521 | 1,146,307 | ||||||
Less: reserve for obsolescence
|
(15,812 | ) | (13,366 | ) | ||||
Net inventory
|
$ | 1,360,709 | $ | 1,132,941 | ||||
7. | PREPAID EXPENSES | |
Prepaid expenses are summarized as follows: |
March 31, 2008 | March 31, 2007 | |||||||
Prepaid materials and components
|
$ | 588,639 | $ | 394,598 | ||||
Prepaid Belgium income taxes
|
79,060 | 66,830 | ||||||
Prepaid consulting
|
62,237 | 66,830 | ||||||
VAT payments in excess of VAT receipts
|
117,467 | 47,260 | ||||||
Royalties
|
39,530 | 33,415 | ||||||
Prepaid trade show expenses
|
25,276 | 6,523 | ||||||
Prepaid rent
|
10,812 | 7,054 | ||||||
Other
|
47,152 | 45,911 | ||||||
|
$ | 970,173 | $ | 668,421 | ||||
8. | PROPERTY AND EQUIPMENT | |
Property and equipment are summarized as follows: |
March 31, 2008 | March 31, 2007 | |||||||
Furniture and Fixtures
|
$ | 182,079 | $ | 137,560 | ||||
Machinery and Equipment
|
801,251 | 559,422 | ||||||
Tooling
|
254,450 | 188,450 | ||||||
|
1,237,780 | 885,432 | ||||||
Accumulated depreciation
|
(545,171 | ) | (295,809 | ) | ||||
Property & equipment, net
|
$ | 692,609 | $ | 589,623 | ||||
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9. | LONG TERM INVESTMENTS AND ADVANCES | |
Innovative Medical & Dental Solutions, LLC (IMDS, LLC) | ||
Effective July 15, 2007 the Company entered into a Limited Liability Company Merger and Equity Reallocation Agreement (the Participation Agreement) through its subsidiary, Remedent N.V. Pursuant to the terms of the Participation Agreement, the Company has acquired a 10% equity interest in IMDS, LLC in consideration for $300,000 which was converted against IMDS receivables. | ||
The agreement stipulates certain exclusive world wide rights to certain tooth whitening technology, and the right to purchase at standard cost certain whitening lights and accessories and to sell such lights in markets not served by the LLC. The terms of the Participation Agreement also provide that Remedent N.V. has the first right to purchase additional equity. Parties to the Participation Agreement include two officers of IMDS, LLC, and an individual who is both an officer and director of Remedent Inc., and certain unrelated parties. | ||
IMDS, LLC is registered with the Secretary of the State of Florida as a limited liability company and with the Secretary of the State of California as a foreign corporation authorized to operate in California. IMDS, LLC is merging with White Science World Wide, LLC, a limited liability company organized under the laws of the State of Georgia. The merged companies are operating as a single entity as IMDS, LLC, a Florida limited liability company. | ||
Soca Networks Singapore (Soca) | ||
Pursuant to the terms of a letter of intent dated December 17, 2007, the Company has agreed to purchase 20% of Soca for a total purchase price of $750,000. Half of the purchase price has been advanced $375,000 to Soca as a down payment, pending completion of the agreement terms. The balance of $375,000 is to be paid through the issuance of 220,588 shares of the Companys common stock. The final agreement is currently being negotiated and management expects to close the agreement within the first half of the new fiscal year 2009. | ||
10. | LICENSED PATENTS | |
Teeth Whitening Patents | ||
In October 2004, the Company acquired from the inventor the exclusive, perpetual license to two issued United States patents which are applicable to several teeth whitening products currently being marketed by the Company. Pursuant to the terms of the license agreement, the Company was granted an exclusive, worldwide, perpetual license to manufacture, market, distribute and sell the products contemplated by the patents subject to the payment of $65,000 as reimbursement to the patent holder for legal and other costs associated with obtaining the patents, which was paid in October 2004, and royalties for each unit sold subject to an annual minimum royalty of $100,000 per year. The Company is amortizing the initial cost of $65,000 for these patents over a ten year period and accordingly has recorded $22,750 of accumulated amortization for this patent as of March 31, 2008. The Company accrues this royalty when it becomes payable to inventory therefore no provision has been made for this obligation as of March 31, 2008 (2007-Nil). | ||
Universal Applicator Patent | ||
In September 2004, the Company entered into an agreement with Lident N.V. (Lident), a company controlled by Mr. De Vreese, the Companys Chairman, to obtain an option, exercisable through December 31, 2005, to license an international patent (excluding the US) and worldwide manufacturing and distribution rights for a potential new product which Lident had been assigned certain rights by the inventors of the products, who are unrelated parties, prior to Mr. De Vreese association with the Company. The patent is an Italian patent which relates to a single use universal applicator for dental pastes, salves, creams, powders, liquids and other substances where manual application could be relevant. The Company has filed to have the patent approved throughout Europe. The agreement required the Company to advance to the inventors through Lident a fully refundable deposit of 100,000 subject to the Companys due diligence regarding the enforceability of the patent and marketability of the product, which, if viable, would be assigned to the Company for additional consideration to the inventors of 100,000 and an ongoing royalty from sales of products related to the patent equal to 3% of net sales and, if not viable, the deposit would be repaid in full by Lident. The consideration the Company had agreed to pay Lident upon the exercise of the option is the same as the consideration Lident is |
F-16
obligated to pay the original inventors. Consequently, Lident would not have profited from the exercise of the option. Furthermore, at a meeting of the Companys Board of Directors on July 13, 2005, the Board accepted Lidents offer to facilitate an assignment of Lidents intellectual property rights to the technology to the Company in exchange for the reimbursement of Lidents actual costs incurred relating to the intellectual property. Consequently, when the Company exercises the option, all future payments, other than the reimbursement of costs would be paid directly to the original inventors and not to Lident. | ||
On December 12, 2005, the Company exercised the option and the Company and the patent holder agreed to revise the assignment agreement whereby the Company agreed to pay 50,000 additional compensation in the form of prepaid royalties instead of the 100,000 previously agreed, 25,000 of which had been paid by the Company in September 2005 and the remaining 25,000 to be paid upon the Companys first shipment of a product covered by the patent. As of March 31, 2008 the company has not yet received the final Product. The patent is being amortized over five (5) years and accordingly, the Company has recorded $55,468 of accumulated amortization for this patent as of March 31, 2008. | ||
11. | LINE OF CREDIT | |
On October 8, 2004, our wholly owned subsidiary, Remedent N.V., obtained a mixed-use line of credit facility with Fortis Bank, a Belgian bank, for 1,070,000 (the Facility). The Facility was secured by a first lien on the assets of Remedent N.V. The purpose of the Facility is to provide working capital to grow our business and to finance certain accounts receivable as necessary. Since opening the Facility in 2004, Remedent N.V. and Fortis Bank have subsequently amended the Facility several times to increase or decrease the line of credit. On May 3, 2005 the Facility was amended to decrease the line of credit to 1,050,000. On March 13, 2006 the Facility was amended to increase the mixed-use line of credit to 2,300,000, consisting of a 1,800,000 credit line based on the eligible accounts receivable and a 500,000 general line of credit. The latest amendment to the Facility, dated January 3, 2008, amended and decreased the mixed-use line of credit to 2,050,000, to be used by Remedent NV and/or Sylphar NV . Each line of credit carries its own interest rates and fees as provided in the Facility. Remedent N.V. and Sylphar N.V. are currently only utilizing two lines of credit, advances based on account receivables and the straight loan. As of March 31, 2008 and March 31, 2007, Remedent N.V. and Sylphar N.V. had in aggregate, $779,718 and $1,530,276 in advances outstanding, respectively, under this mixed-use line of credit facility. |
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12. | LONG TERM DEBT | |
On June 15, 2005, the Company entered into two five year capital lease agreements for manufacturing equipment totaling 70,296 (US $85,231). On October 24, 2006, the Company entered into another five year capital lease agreement for additional manufacturing equipment totaling 123,367 (US $157,503). The leases require monthly payments of principal and interest at 7.43% of 1,258 (US$1,989 at March 31, 2008) for the first two leases and 9.72% of 2,256 (US$3,567 at March 31, 2008) and provide for buyouts at the conclusion of the five year term of 2,820 (US$4,459) or 4.0% of original value for the first two contracts and 4,933 (US $7,800) or 4.0 % of the original value for the second contract. The book value as of March 31, 2008 and March 31, 2007 of the equipment subject to the foregoing leases are $149,673 and $198,225, respectively. | ||
13. | DUE TO RELATED PARTIES AND RELATED PARTY TRANSACTIONS | |
Balances due to related parties consist of the following: |
March 31, 2008 | March 31, 2007 | |||||||
Demand loan from a former officer and major stockholder
|
$ | | $ | 50,536 | ||||
|
$ | | $ | 50,536 | ||||
Borrowings from employees and entities controlled by officers of the Company are, unsecured, non-interest bearing, and due on demand. | ||
Transactions with related parties consisted of the following: | ||
Compensation: | ||
During the years ended March 31, 2008 and 2007 respectively, the Company incurred $671,170 and $595,949 respectively, as compensation for all directors and officers. | ||
Sales Transactions: | ||
One of the Companys directors owns a minority interest in a client company, IMDS Inc., to which goods were sold during the years ended March 31, 2008 and 2007 totaling $87,790 and $476,122 respectively. Accounts receivable at year end with this customer totaled $91,533 and $392,057 as at March 31, 2008 and 2007 respectively. | ||
All related party transactions involving provision of services or tangible assets were recorded at the exchange amount, which is the value established and agreed to by the related parties reflecting arms length consideration payable for similar services or transfers. Other related party transactions are disclosed in Note 17. | ||
14. | ACCRUED LIABILITIES | |
Accrued liabilities are summarized as follows: |
March 31, 2008 | March 31, 2007 | |||||||
Accrued employee benefit taxes and payroll
|
$ | 178,645 | $ | 260,676 | ||||
Accrued Travel
|
17,667 | | ||||||
Advances and deposits
|
212,736 | | ||||||
Commissions
|
130,875 | 2,834 | ||||||
Accrued audit and tax preparation fees
|
4,000 | 27,282 | ||||||
Reserve for warranty costs
|
23,718 | 20,049 | ||||||
Accrued interest
|
984 | 6,180 | ||||||
Accrued consulting fees
|
35,204 | 2,528 | ||||||
Other accrued expenses
|
177,908 | 92,886 | ||||||
|
$ | 781,737 | $ | 412,435 | ||||
F-18
15. | INCOME TAXES | |
The Company accounts for income taxes under Statement of Financial Accounting Standards No. 109, Accounting for Income Taxes (SFAS No. 109). Under the asset and liability method of SFAS No. 109, deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under SFAS No. 109, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. | ||
In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversals of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. | ||
The domestic and foreign (Belgium and Singapore) components of income (loss) before income taxes and minority interest were comprised of the following: |
March 31, 2008 | March 31, 2007 | |||||||
Domestic
|
$ | (1,722,134 | ) | $ | (1,627,604 | ) | ||
Foreign
|
(1,366,132 | ) | 131,555 | |||||
|
$ | (3,088,266 | ) | $ | (1,496,049 | ) | ||
March 31, 2008 | March 31, 2007 | |||||||
Domestic Net operating loss carryforward
|
$ | 3,561,841 | $ | 3,025,488 | ||||
Foreign Net operating loss carryforward
|
639,893 | 202,731 | ||||||
Total
|
4,201,734 | 3,228,219 | ||||||
Valuation allowance
|
(4,201,734 | ) | (3,228,219 | ) | ||||
Net deferred tax assets
|
$ | | $ | | ||||
March 31, 2008 | March 31, 2007 | |||||||
Domestic
|
||||||||
Pre tax income (loss)
|
$ | (1,722,134 | ) | $ | (1,627,604 | ) | ||
Statutory tax rate
|
35 | % | 35 | % | ||||
Tax benefit based upon statutory rate
|
(602,747 | ) | (569,661 | ) | ||||
Valuation allowance
|
602,747 | 569,661 | ||||||
Net domestic income tax (benefit)
|
| | ||||||
Foreign
|
||||||||
Pre tax income (loss)
|
(1,366,132 | ) | 135,101 | |||||
Statutory tax rate
|
32 | % | 32 | % | ||||
Tax expense (benefit) based upon statutory rate
|
(437,162 | ) | 43,232 | |||||
Permanent differences
|
437,162 | (43,232 | ) | |||||
Net operating loss
|
| | ||||||
Net foreign income tax (benefit)
|
| | ||||||
Total Income tax (benefit )
|
$ | | $ | | ||||
F-19
16. | CAPITAL STOCK | |
On June 25, 2007, the Company completed a private offering of 5,600,000 shares of its common stock, par value $.001 per share at a purchase price of $1.25 per share (the Shares) and five year warrants to purchase 4,200,000 shares of common stock, par value $.001 per share, at an exercise price of $1.55 per share (the Warrants) to certain institutional and accredited investors, for an aggregate purchase price of $7,000,000 (the Offering). | ||
Under the terms of the Offering, the Company has the right to redeem the Warrants for $0.001 per Warrant Share covered by the Warrants if the Shares trade on the OTC Electronic Bulletin Board or similar market above $5.25 per share for 20 consecutive trading days following the initial effective date of the registration statement covering the resale of the Shares and Warrant Shares, based upon the closing bid price for the Shares for each trading day (the Redemption Right). Once the Redemption Right vests, the Company has the right, but not the obligation, to redeem the Warrants for $0.001 per Warrant Share covered by the Warrants upon 30 days written notice to the holders of the Warrants. | ||
Under the terms of the Purchase Agreement and the Registration Rights Agreement, the Company is required to prepare and file with the SEC a registration statement covering the resale of the Shares and the Warrant Shares. The Company has agreed to prepare and file a registration statement covering the resale no later than 30 days after the Closing (the Filing Deadline). In the event the Company is unable to file a registration statement by the Filing Deadline or the registration statement is not declared effective on or before 90 days from the Closing (120 days from the Closing if the registration statement is reviewed by the SEC) (Effective Deadline), then the Company will have to pay liquidated damages equal to 1.5% of the aggregate amount invested by each investor for each 30-day period, or pro rata portion thereof, following the date by which such registration statement should have been effective, until the registration statement has been declared effective by the SEC. All payments must be made in cash. | ||
The Placement Agent is entitled to a fee equal to ten percent (10%) of the gross proceeds derived from the Offering, of which the Placement Agent may, at its option, receive up to 2% of its 10% fee in securities issued in the Offering. The Company has agreed to pay the Placement Agent 5% of the exercise price of the Warrants promptly following the Companys receipt thereof. In addition, the Company agreed to reimburse the Placement Agent for its out-of-pocket expenses related to the Offering, including an up-front payment of $25,000 to cover such expenses, of which any unused amount will be netted against the Placement Agents 10% fee. | ||
The Units were offered and sold by the Company to accredited investors in reliance on Section 506 of Regulation D of the Securities Act of 1933, as amended. | ||
During the three months ended December 31, 2007 the Company received $15,900 on the exercise of 10,000 common stock purchase warrants. | ||
On February 19, 2008, the Company entered into a formal debt conversion and Registration Rights Agreement with a former investor of the Company. The debt was in the amount of $50,536 and was for past services and obligations attributable to the operations of the Company and its California subsidiaries. In exchange for the debt the Company issued 31,558 common shares of its capital stock. | ||
17. | EQUITY COMPENSATION PLANS | |
The Board of Directors and stockholders approved the Nonstatutory Stock Option Plan (the 2001 Plan) and adopted it on May 29, 2001. The Company has reserved 250,000 shares of its common stock for issuance to the directors, employees and consultants under the Plan. The Plan is administered by the Board of Directors. Vesting terms of the options range from immediately to five years. | ||
Pursuant to an Information Statement on Schedule 14C mailed on May 9, 2005 to all stockholders of record as of the close of business on February 1, 2005 and became effective June 3, 2005, the Company authorized the implementation of a 2004 Incentive and Nonstatutory Stock Option Plan (2004 Plan) reserving 800,000 shares of common stock for issuance to employees, directors and consultants of the Company or any subsidiaries. This plan became effective as of June 3, 2005 after the Company had completed a one for twenty reverse split. |
F-20
On October 12, 2005, the Company entered into an Employment Agreement with an individual to render full-time employment to the Company as for an initial term of three (3) years whose duties include managing worldwide sales for the Company. The agreement automatically renews for an additional one (1) year period at the end of each then existing term, unless one party gives to the other written notice to terminate. The agreement provides for an annual salary of $275,000 and quarterly bonuses in the amount of $25,000, subject to certain conditions. The agreement also granted 400,000 options under the Companys 2004 Incentive and Nonstatutory Stock Option Plan (the Stock Plan). The options were priced at $4.00. The options vest one third each on the last day of the first, second and third years of employment. These options have a term of eight (8) years from the date of grant and are subject to other standard terms and conditions under the Stock Plan and contain standard anti-dilution language and a provision for cashless exercise. The market value of the foregoing option grant based upon the Black-Scholes option pricing model utilizing a market price on the date of grant of $3.50 per share, an annualized volatility of 155%, a risk free interest rate of 4.5% and an expected life of eight years is $3.41 per option granted, for a total value of approximately $1,364,490. | ||
On December 23, 2005, the Company granted to its Chief Financial Officer 75,000 ten year options to purchase the Companys common stock at an exercise price of $2.46, the market value of the Companys stock on the date of grant. The options were fully vested upon issue. The value of the foregoing option grants based upon the Black-Scholes option pricing model utilizing a market price on the date of grant of $2.46 per share, an annualized volatility of 155%, a risk free interest rate of 4.5% and an expected life of eight years is $2.40 per option granted, for a total value of approximately $180,000. | ||
On October 1, 2006, the Company granted to a marketing consultant 25,000 options to purchase the Companys common stock at a price of $1.80 per share. These options vested immediately upon grant and are exercisable for a period of five years. The Company valued the foregoing options using the Black Scholes option pricing model using the following assumptions: no dividend yield; expected volatility rate of 91.58%; risk free interest rate of 5% and an average life of 5 years resulting in a value of $1.298 per option granted. | ||
On June 14, 2006, pursuant to an S-8 filed with the SEC, the Company registered 1,150,000 common shares, pursuant to compensation arrangements. | ||
On August 17, 2007, pursuant to the terms of the Companys 2004 Plan, the Company granted to an employee 100,000 options to purchase the Companys common stock at a price of $1.50 per share. These options will vest over the next 3 years and are exercisable for a period of 5 years. The Company valued the foregoing options using the Black Scholes option pricing model using the following assumptions: no dividend yield; expected volatility rate of 115%; risk free interest rate of 4.75% and an average life of 5 years resulting in a value of $1.24 per option granted. The value of these options will be recognized on a straight-line basis over the next three years and accordingly a value of $28,780 has been recorded in the year ended March 31, 2008. | ||
On September 21, 2007 the Company granted to employees and directors a total of 570,000 options to purchase the Companys common stock at a price of $1.75 per share. These options will vest over the next 3 years and are exercisable for a period of 10 years. The Company valued the foregoing options using the Black Scholes option pricing model using the following assumptions: no dividend yield; expected volatility rate of 115%; risk free interest rate of 4.75% and an average life of 7 years resulting in a value of $1.47 per option granted. The value of these options will be recognized on a straight-line basis over the next three years and accordingly a value of $160,916 has been recorded in the year ended March 31, 2008. | ||
A summary of the option activity for the years ended March 31, 2008 and 2007 pursuant to the terms of the plans is as follows: |
2001 Plan | 2004 Plan | Other | ||||||||||||||||||||||
Weighted | Weighted | Weighted | ||||||||||||||||||||||
Outstanding | Average | Outstanding | Average | Outstanding | Average | |||||||||||||||||||
Options | Exercise Price | Options | Exercise Price | Options | Exercise Price | |||||||||||||||||||
Options outstanding , March 31, 2007
|
222,500 | $ | 1.29 | 210,666 | $ | 3.19 | | | ||||||||||||||||
|
||||||||||||||||||||||||
Granted
|
| | 520,000 | 1.71 | 150,000 | $ | 1.75 | |||||||||||||||||
Exercised
|
| | | | | | ||||||||||||||||||
Cancelled or expired
|
| | | | | | ||||||||||||||||||
|
||||||||||||||||||||||||
Options outstanding, March 31, 2008
|
222,500 | $ | 1.29 | 730,666 | $ | 2.29 | 150,000 | $ | 1.75 | |||||||||||||||
|
||||||||||||||||||||||||
Options exercisable March 31, 2008
|
222,500 | $ | 1.29 | 210,666 | $ | 4.46 | | | ||||||||||||||||
|
||||||||||||||||||||||||
Exercise price range
|
$ | 1.00 to $4.00 | $ | 1.50 to $4.00 | $ | 1.75 | ||||||||||||||||||
|
||||||||||||||||||||||||
Weighted average remaining life
|
4.0 years | 5.43 years | 8.72 years | |||||||||||||||||||||
|
||||||||||||||||||||||||
Shares available for future issuance
|
27,500 | 69,334 | N/A | |||||||||||||||||||||
|
F-21
A summary of the Companys equity compensation plans approved and not approved by shareholders is as follows: |
Number of | Number of securities | |||||||||||
securities to be | remaining available for | |||||||||||
issued upon | future issuance under | |||||||||||
exercise of | Weighted-average | equity compensation | ||||||||||
outstanding | exercise price of | plans (excluding | ||||||||||
options, warrants | outstanding options | securities reflected | ||||||||||
Plan Category | and right | warrants and rights | in column (a)) | |||||||||
Equity Compensation Plans approved by security holders
|
1,103,166 | $ | 2.01 | 96,834 | ||||||||
Equity Compensation Plans not approved by security holders
|
297,298 | $ | 1.50 | NA | ||||||||
|
||||||||||||
|
1,400,464 | $ | 1.91 | 96,834 | ||||||||
|
Prior to January 1, 2006, the Company accounted for employee stock-based compensation under the recognition and measurement principles of Accounting Principles Board Opinion (APB) No. 25, Accounting for Stock Issued to Employees, and related Interpretations, as permitted by SFAS No. 123, Accounting for Stock-Based Compensation. Under the recognition principles of APB No. 25, compensation expense related to restricted stock and performance units was recognized in the financial statements. However, APB No. 25 generally did not require the recognition of compensation expense for stock options because the exercise price of these instruments was generally equal to the fair value of the underlying common stock on the date of grant, and the related number of shares granted were fixed at that point in time. | ||
Effective January 1, 2006, the Company adopted the fair value recognition provisions of SFAS No. 123(R), Share-Based Payment. In addition to recognizing compensation expense related to restricted stock and performance units, SFAS No. 123(R) also requires recognition of compensation expense related to the estimated fair value of stock options. The Company adopted SFAS No. 123(R) using the modified-prospective-transition method. Under that transition method, compensation expense recognized subsequent to adoption includes: (a) compensation cost for all share-based payments granted prior to, but not yet vested as of January 1, 2006, based on the values estimated in accordance with the original provisions of SFAS No. 123, and (b) compensation cost for all share-based payments granted subsequent to January 1, 2006, based on the grant-date fair values estimated in accordance with the provisions of SFAS No. 123(R). Consistent with the modified-prospective-transition method, the Companys results of operations for prior periods have not been adjusted to reflect the adoption of FAS 123(R). For the year ended March 31, 2008, the Company recognized $189,696 (2007 $221,959) in compensation expense in the consolidated statement of operations | ||
18. | COMMON STOCK WARRANTS AND OTHER OPTIONS | |
On February 10, 2006, the Company issued to an individual the right to purchase 150,000 shares of the Companys common stock at an exercise price of $2.60 per share for a term of five (5) years pursuant to the terms and conditions of a Stock Option Agreement as consideration for past services performed and the release of any and all claims under this individuals prior agreements with the Company. The 150,000 options have been valued in accordance with the Black-Scholes pricing model utilizing an historic volatility factor of 1.55, a risk free interest rate of 4.5% and an expected life for the options of five years, resulting in a value of $2.41 per option granted for a total for the warrants of $361,500. The value of this option grant was recorded as of December 31, 2005 as a research and development expense. | ||
In November 2006, the Company entered into a Settlement Agreement and Release (Settlement Agreement) with this individual pursuant to which the prior agreement was terminated. In connection with the Settlement Agreement, the Company agreed to pay this individual $65,000 in settlement of all accounts which was recorded |
F-22
as an expense as of the date of the Settlement Agreement and he in turn agreed to the cancellation of his options to purchase 150,000 shares of the Companys common stock in exchange for certain product rights that the Company had elected not to pursue. |
As of March 31, 2008, the Company has 7,260,026 warrants to purchase the Companys common stock outstanding that were not granted under shareholder approved equity compensation plans at prices ranging between $1.20 and $3.00 per share with expiration dates between August 2007 and September 2012 as follows: |
Weighted | ||||||||
Outstanding | Average Exercise | |||||||
Warrants | Price | |||||||
Warrants and options outstanding , March 31, 2007
|
3,105,651 | $ | 1.72 | |||||
Granted
|
4,200,000 | 1.55 | ||||||
Exercised
|
(10,000 | ) | 1.59 | |||||
Cancelled or expired
|
(35,725 | ) | | |||||
|
||||||||
Warrants exercisable March 31, 2008
|
7,260,026 | $ | 1.67 | |||||
|
||||||||
Exercise price range
|
$ | 1.20 to $10.00 | ||||||
|
||||||||
Weighted average remaining life
|
4.93 Years | |||||||
|
19. | SEGMENT INFORMATION | |
The Companys only operating segment consists of dental products and oral hygiene products sold by Remedent Inc., Remedent N.V., Sylphar N.V. and Remedent Asia Ltd.. Since the Company only has one segment, no further segment information is presented. | ||
Customers Outside of the United States |
March 31, 2008 | March 31, 2007 | |||||||
U.S. sales
|
$ | 1,598,046 | $ | 561,055 | ||||
Foreign sales
|
5,884,215 | 6,115,310 | ||||||
|
$ | 7,482,261 | $ | 6,676,365 | ||||
20. | COMMITMENTS | |
Real Estate Lease | ||
The Company leases its 26,915 square feet office and warehouse facility in Deurle, Belgium from an unrelated party pursuant to a nine year lease commencing December 20, 2001 at a base rent of $6,838 per month ($11,097 per month at March 31, 2008). The minimum aggregate rent to be paid over the remaining lease term based upon the conversion rate for the at March 31, 2008 is $359,773. Rent expense for the forgoing lease for the years ended March 31, 2008 and March 31, 2007 was $119,097 and $105,276 respectively. | ||
Minimum monthly lease payments for real estate, and all other leased equipment for the next three years are as follows based upon the conversion rate for the (Euro) at March 31, 2008. |
March 31, 2009
|
$ | 240,734 | ||
March 31, 2010
|
$ | 76,896 | ||
March 31, 2011
|
$ | 42,143 | ||
Total:
|
$ | 359,773 |
21. | SUBSEQUENT EVENT | |
On April 24, 2008, the Company entered into a Factoring Agreement (Agreement) with First Community Financial, a division of Pacific Western Bank (First Community) whereby First Community may purchase, from time to time, on a limited recourse basis such of the Companys accounts now existing or hereafter created and arising out of the sale of goods or service by the Company. The factoring credit facility limit is $1,000,000 and amounts factored are subject to an interest rate of prime plus 2%. Security for the factoring credit facility is a first charge over all the assets of the Company. The Agreement shall remain in effect until October 16, 2008 and may be renewed for successive six month periods unless terminated under certain conditions. | ||
On June 30, 2008, the Company entered into an OEM Agreement (Agreement) with SensAble Technologies, Inc., a corporation under the laws of Delaware (SensAble) whereby the Company will integrate SensAble products and technology into the Companys system. The Agreement provides the Company with the exclusive right to distribute certain SensAble products throughout the world for a period of twelve (12) months from the date of the Agreement. The Company has the option and right to extend the initial twelve (12) month exclusivity period for another twelve (12) months. The term of the Agreement will be for two years and began on June 30, 2008. |
F-23
Nevada | 001-15975 | 86-0837251 | ||
(State or Other Jurisdiction of
Incorporation) |
(Commission File Number) |
(IRS Employer
Identification No.) |
Xavier de Cocklaan 42, 9831, Deurle, Belgium | N/A | |
(Address of Principal Executive Offices) | (Zip Code) |
Exhibit No. | Exhibit Description | |
|
||
10.1
|
Distribution Agreement, dated June 30, 2008, by and between Remedent, Inc. and SensAble Technologies, Inc. * |
* | Application has been made to the Securities and Exchange Commission to seek confidential treatment of certain portions of this Exhibit 10.1 under Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Omitted material for which confidential treatment has been requested has been filed separately with the Securities and Exchange Commission. |
REMEDENT, INC.
,
a Nevada corporation |
||||
Dated: July 2, 2008 | By: | /s/ Robin List | ||
Robin List | ||||
Chief Executive Officer | ||||
Exhibit No. | Exhibit Description | |
|
||
10.1
|
Distribution Agreement, dated June 30, 2008, by and between Remedent, Inc. and SensAble Technologies, Inc. * |
* | Application has been made to the Securities and Exchange Commission to seek confidential treatment of certain portions of this Exhibit 10.1 under Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Omitted material for which confidential treatment has been requested has been filed separately with the Securities and Exchange Commission. |
Nevada | 001-15975 | 86-0837251 | ||
(State or Other Jurisdiction of
Incorporation) |
(Commission File Number) |
(IRS Employer
Identification No.) |
||
Xavier de Cocklaan 42, 9831, Deurle, Belgium | N/A | |||
(Address of Principal Executive Offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit No. | Exhibit Description | |||
|
||||
10.1 |
Distribution Agreement, dated April 10, 2008, by and between
Remedent n.v and GlamTech USA, Inc. *
|
|||
|
||||
99.1 |
Press
Release dated April 15, 2008, Remedent, Inc. Announces
launch of Exclusive Strategic Marketing Program with GlamTech USA,
Inc. for the Distribution of Glamsmile in the United States and
Canada
|
|||
|
* | The Securities and Exchange Commission granted the Companys application to seek confidential treatment of certain portions of Exhibit 10.1 under Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Omitted material for which confidential treatment was granted has been filed separately with the Securities and Exchange Commission. |
REMEDENT, INC.
,
a Nevada corporation |
||||
Dated: July 2, 2008 | By: | /s/ Robin List | ||
Robin List, | ||||
Chief Executive Officer |
Exhibit No. | Exhibit Description | |||
|
||||
10.1 |
Distribution Agreement, dated April 10, 2008, by and between
Remedent n.v and GlamTech USA, Inc. *
|
|||
|
||||
99.1 |
Press
Release dated April 15, 2008, Remedent, Inc. Announces
launch of Exclusive Strategic Marketing Program with GlamTech USA,
Inc. for the Distribution of Glamsmile in the United States and
Canada
|
* | The Securities and Exchange Commission granted the Companys application to seek confidential treatment of certain portions of Exhibit 10.1 under Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Omitted material for which confidential treatment was granted has been filed separately with the Securities and Exchange Commission. |
Nevada | 001-15975 | 86-0837251 | ||
(State or Other Jurisdiction of
Incorporation) |
(Commission File Number) |
(IRS Employer
Identification No.) |
Xavier de Cocklaan 42, 9831, Deurle, Belgium | N/A | |
(Address of Principal Executive Offices) | (Zip Code) |
Exhibit No. | Exhibit Description | |
|
||
10.1
|
Factoring Agreement between Remedent, Inc. and First Community Financial, a division of Pacific Western Bank, dated April 24, 2008 | |
|
||
10.2
|
Validity Agreement between certain officers and directors of Remedent, Inc. and First Community Financial, a division of Pacific Western Bank, dated April 24, 2008 |
REMEDENT, INC.
,
a Nevada corporation |
||||
Dated: April 30, 2008 | By: | /s/ Robin List | ||
Robin List, | ||||
Chief Executive Officer | ||||
Exhibit No. | Exhibit Description | |
|
||
10.1
|
Factoring Agreement between Remedent, Inc. and First Community Financial, a division of Pacific Western Bank, dated April 24, 2008 | |
|
||
10.2
|
Validity Agreement between certain officers and directors of Remedent, Inc. and First Community Financial, a division of Pacific Western Bank, dated April 24, 2008 |
Nevada | 001-15975 | 86-0837251 | ||
(State or Other Jurisdiction of
Incorporation) |
(Commission File Number) |
(IRS Employer
Identification No.) |
||
Xavier de Cocklaan 42, 9831, Deurle, Belgium | N/A | |||
(Address of Principal Executive Offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit No. | Exhibit Description | |||
|
||||
10.1 |
Distribution Agreement, dated April 10, 2008, by and between
Remedent n.v and GlamTech USA, Inc. *
|
|||
|
||||
99.1 |
Press
Release dated April 15, 2008, Remedent, Inc. Announces
launch of Exclusive Strategic Marketing Program with GlamTech USA,
Inc. for the Distribution of Glamsmile in the United States and
Canada
|
|||
|
* | Application has been made to the Securities and Exchange Commission to seek confidential treatment of certain portions of this Exhibit 10.1 under Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Omitted material for which confidential treatment has been requested has been filed separately with the Securities and Exchange Commission. |
REMEDENT, INC.
,
a Nevada corporation |
||||
Dated: April 14, 2008 | By: | /s/ Robin List | ||
Robin List, | ||||
Chief Executive Officer |
Exhibit No. | Exhibit Description | |||
|
||||
10.1 |
Distribution Agreement, dated April 10, 2008, by and between
Remedent n.v and GlamTech USA, Inc. *
|
|||
|
||||
99.1 |
Press
Release dated April 15, 2008, Remedent, Inc. Announces
launch of Exclusive Strategic Marketing Program with GlamTech USA,
Inc. for the Distribution of Glamsmile in the United States and
Canada
|
* | Application has been made to the Securities and Exchange Commission to seek confidential treatment of certain portions of this Exhibit 10.1 under Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Omitted material for which confidential treatment has been requested has been filed separately with the Securities and Exchange Commission. |
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