Exhibit 10.1
RELEASE AND SETTLEMENT AGREEMENT
This Release and Settlement Agreement (this "Agreement") is entered into
this 2nd day of December 2002, by and between Xxxxxxxx Marine ("Marine") and
Remedent USA, Inc., a Nevada corporation and any affiliates and subsidiaries
(collectively, "Remedent").
A. Marine and Remedent are parties to that certain Agreement dated December
21, 2001 (the "2001 Agreement") with respect to certain monetary and equity
obligations by Remedent to Marine.
B. Marine and Remedent desire to terminate the 2001 Agreement and replace
it in its entirety with this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are acknowledged, and in consideration of the covenants and
undertakings of the parties as set forth herein, the parties, intending to be
legally bound, mutually agree as follows:
1. Remedent's Stock and Stock Option Issuances. Remedent hereby agrees as
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follows:
a. On or before December 9, 2002, Remedent will deliver to Marine a
properly executed stock certificate representing 1,400,000 duly authorized,
validly existing and fully paid up shares of Remedent's common stock (the "1.4
Million Shares"), as such number of shares may be adjusted by any stock split,
reverse stock split or other modification in the number of outstanding shares
carried out by Remedent between November 11, 2002 and the date upon which all
shares to be delivered hereunder to Marine are so delivered (collectively, a
"Stock Adjustment"). The 1.4 Million Shares shall be placed in a segregated
securities trading account by Marine that is set up exclusively to hold the 1.4
Million Shares and no other securities of Remedent.
b. On or before December 9, 2002, Remedent will deliver to Marine a
properly executed stock certificate representing 650,000 duly authorized,
validly existing and fully paid up shares of Remedent's common stock (the "650K
Shares"), as such number of shares may be adjusted by a Stock Adjustment.
c. On or before December 9, 2002, Remedent will deliver to Marine a
properly executed stock certificate representing 100,000 duly authorized,
validly existing and fully paid up shares of Remedent's common stock (the "100K
Shares"), as such number of shares may be adjusted by a Stock Adjustment.
d. On or before December 9, 2002, Remedent will deliver to Marine a
warrant agreement in form and content generally agreed upon by Remedent and
Marine prior to such date representing the right to purchase 250,000 shares of
Remedent common stock at an exercise price of $0.10 per share (the "Warrant").
The Warrant shall be exercisable during a ten year period commencing on the date
of this Agreement.
Registration Rights.
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a. Remedent has filed a registration statement on Form SB-2
("Registration Statement") with the Securities and Exchange Commission
("Commission") on July 24, 2002, designated as file number 333-96999. In the
Registration Statement, Remedent included Marine as a selling security holder of
up to 2,200,000 shares of Remedent common stock, inclusive of the 1.4 Million
Shares, the 650K Shares and the Warrant. On Amendment No. 1 to the Registration
Statement , Remedent shall change the total number of shares being registered to
include the 100K Shares. Thus, the number of shares that could be sold under the
registration statement by Marine would be 2,400,000 (reflecting what appears to
be a typographical error in the Registration Statement which should have read
2,300,000 shares, plus the 100K Shares included under this Agreement). Remedent
hereby covenants and agrees to use its best efforts to continue processing the
Registration Statement until it is declared effective by the Commission, which
declaration shall occur no later than sixty (60) days after the date of this
Agreement. If the Commission fails to declare the Registration Statement
effective by such date, this Agreement shall be deemed terminated as of the date
of its inception and the 2001 Agreement shall thereafter continue in full force
and effect as if its was never terminated. Thereafter, Remedent shall use its
best efforts to have the Registration Statement remain effective until the date
specified in Section 2b(2). All registration related activities shall be at
Remedent's sole cost and expense.
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b. In connection with Remedent's registration obligations hereunder,
Remedent shall, at its sole cost and expense:
(1) Furnish to Marine and any counsel of his choice, copies of
all such documents proposed to be filed, which documents (other than those
incorporated by reference) will be subject to the review of Marine and his
counsel, and cause Remedent's officers and directors, counsel and independent
certified public accountants to respond to such inquiries as shall be necessary,
in the reasonable opinion of counsel to Marine, to conduct a reasonable
investigation within the meaning of the Securities Act. Remedent shall not file
any Registration Statement or any prospectus or any amendments or supplements
thereto to which Marine is named in as a selling shareholder if Marine or his
counsel shall reasonably object in writing within three (3) Business Days of
their receipt thereof.
(2) Prepare and file with the Commission such amendments,
including post-effective amendments, to the Registration Statements as may be
necessary to keep the Registration Statement continuously effective as to
Marine's securities for no less than the date that is the earlier of (x) the
date when all Marine's shares covered by such Registration Statement have been
sold or (y) the date on which all of Marine's shares may be sold without any
restriction pursuant to Rule 144 as determined by the counsel to Remedent
pursuant to a written opinion letter, addressed to Remedent's transfer agent to
such effect (the "Effectiveness Period") and prepare and file with the
Commission such additional Registration Statements in order to register for
resale under the Securities Act all of Marine's shares in Remedent that he is
being issued or granted in this Agreement; (ii) cause the related prospectus to
be amended or supplemented by any required prospectus supplement, and as so
supplemented or amended to be filed pursuant to Rule 424 (or any similar
provisions then in force) promulgated under the Securities Act; (iii) respond as
promptly as possible to any comments received from the Commission with respect
to the Registration Statement or any amendment thereto and as promptly as
possible provide Marine true and complete copies of all correspondence from and
to the Commission relating to the Registration Statement; and (iv) comply in all
material respects with the provisions of the Securities Act and the Exchange Act
with respect to the disposition of all of Marine's securities covered by the
Registration Statement during the applicable period in accordance with the
intended methods of disposition by Marine set forth in the Registration
Statement as so amended or in such prospectus as so supplemented.
(3) Use its best efforts to avoid the issuance of, or, if issued,
obtain the withdrawal of, (i) any order suspending the effectiveness of the
Registration Statement or (ii) any suspension of the qualification (or exemption
from qualification) of any of Marine's securities for sale in any jurisdiction,
at the earliest practicable moment.
(4) If requested by Marine, (i) promptly incorporate in a
prospectus supplement or post-effective amendment to the Registration Statement
such information as Remedent reasonably agrees should be included therein and
(ii) make all required filings of such prospectus supplement or such
post-effective amendment as soon as practicable after the Company has received
notification of the matters to be incorporated in such prospectus supplement or
post-effective amendment.
(5) Furnish to Marine and his counsel, without charge, at least
one conformed copy of each Registration Statement and each amendment thereto,
including financial statements and schedules, all documents incorporated or
deemed to be incorporated therein by reference, and all exhibits to the extent
requested by Marine (including those previously furnished or incorporated by
reference) promptly after the filing of such documents with the Commission.
(6) Promptly deliver to Marine and his counsel, without charge,
as many copies of the prospectus or prospectuses (including each form of
prospectus) and each amendment or supplement thereto as Marine may reasonably
request; and Remedent hereby consents to the use of such prospectus and each
amendment or supplement thereto by Marine in connection with the offering and
sale of his shares of Remedent covered by such prospectus and any amendment or
supplement thereto.
(7) Prior to any public offering of Marine's securities, use its
best efforts to register or qualify or cooperate with Marine and his counsel in
connection with the registration or qualification (or exemption from such
registration or qualification) of such securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions within the United States as
Marine requests in writing, to keep each such registration or qualification (or
exemption therefrom) effective during the Effectiveness Period and to do any and
all other acts or things necessary or advisable to enable the disposition in
such jurisdictions of Marine's securities covered by a Registration Statement.
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(8) Cooperate with Marine to facilitate the timely preparation
and delivery of certificates representing his securities to be sold pursuant to
a Registration Statement, which certificates shall be free of all restrictive
legends, and to enable such securities to be in such denominations and
registered in such names as Marine may request at least two (2) Business Days
prior to any sale of his securities.
(9) As necessary, as promptly as possible, prepare a supplement
or amendment, including a post-effective amendment, to the Registration
Statement or a supplement to the related prospectus or any document incorporated
or deemed to be incorporated therein by reference, and file any other required
document so that, as thereafter delivered, neither the Registration Statement
nor such prospectus will contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(10) Use its best efforts to cause all of Marine's securities
relating to such Registration Statement to be listed on The Nasdaq SmallCap
Market, The Nasdaq National Market, OTC Bulletin Board and any other securities
exchange, quotation system or market, if any, on which similar securities issued
by Remedent are then listed.
(11) Comply in all material respects with all applicable rules
and regulations of the Commission.
c. To the extent that a stop order is imposed by the Commission or any
other circumstance occurs that prevents or delays Marine's ability to sell any
of his Remedent securities, any time period that favors Marine in this Agreement
shall be extended for the amount of time that Marine was unable to sell any of
his Remedent securities.
3. Proceeds Protection for 1.4 Million Shares. Remedent hereby covenants
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and agrees that Marine shall receive no less than $100,000 in aggregate net
proceeds from the sale of the 1.4 Million Shares, provided that such sales are
made from time to time in the open market in accordance with all applicable
federal and state securities laws. For purposes of this section, "net proceeds"
shall mean the net dollars received by Marine after payment of any applicable
brokerage commissions, fees, charges, legal fees and the like in connection with
the marketing and sale of the 1.4 Million Shares. If, upon the earlier to occur
(the "Deadline") of (i) one year from the date that the Registration Statement
is declared effective covering all of Marine's shares; and (ii) the date upon
which Marine has sold all 1.4 Million Shares, Marine has not received $100,000
in net proceeds, then Remedent shall, at Marine's option, upon written notice to
Remedent, pay to Marine the amount equal to the difference between $100,000 and
the net proceeds actually received by Marine from the sale of some or all of the
1.4 Million Shares by the Deadline. The Deadline shall be automatically extended
by any time period where Remedent has taken action or failed to act in such a
manner as to prevent, prohibit or otherwise impede Marine's sales of any of the
1.4 Million Shares (e.g.; a Commission stop order or a voluntary termination or
suspension of the effectiveness of the Registration Statement). If Marine has
not sold all of his 1.4 Million Shares by the Deadline and desires to exercise
his option hereunder, then upon payment of the entire amount then owing to
Marine by Remedent under this Section 3, Marine agrees to surrender to Remedent
the remaining shares of the 1.4 Million Shares that he then owns. Any shortfall
owed by Remedent to Marine hereunder shall bear interest at the rate of 10% from
the Deadline until the date paid to Marine. Such interest shall commence accrual
ten (10) days after written notice is sent by Marine to Remedent. The 650K
Shares, the 100K Shares and the Warrant shall be unaffected by this surrender
provision.
4. Board Appointment. As long as Marine owns or has the right to receive at
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least 1,400,000 shares of Remedent securities, Remedent agrees to appoint Marine
to the Board of Directors of Remedent upon Marine's request.
5. Release. Except as set forth in this Agreement, each party, on behalf of
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itself and its respective agents, attorneys, representatives, heirs, successors,
assigns and each and all of them, hereby releases, acquits, covenants not to xxx
and forever discharges the other and its respective current and former agents,
attorneys, attorneys' agents, representatives, employees, officers, directors,
trustees, heirs, successors, predecessors, assigns, parent corporations,
subsidiaries (each of the foregoing being hereinafter referred to as a "Released
Party") and each and all of them, of and from any and all obligations, debts,
claims, liabilities, demands, and causes of action of every kind, nature and
description whatsoever, whether or not now known, suspected or claimed, which
they ever had, now have or may hereafter acquire, by reason of any matter,
cause, event, action, inaction, or things whatsoever occurring or arising out of
the 2001 Agreement; provided however, that if Remedent breaches any provision of
this Agreement, Marine may, upon notice to Remedent, declare this Agreement to
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be terminated and in such event the 2001 Agreement would continue in full force
and effect as if it had never been terminated.
6. Acknowledgment. Each party understands and acknowledges that this
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Agreement constitutes a voluntary waiver of any and all rights and claims
against the other whether or not they are aware of them. Each party has also
waived rights or claims pursuant to this Agreement and in exchange for
consideration.
Section 1542 of the Civil Code of the State of California provides:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.
Each party hereby waives any rights it may have under Section 1542 of the
California Civil Code. Each party acknowledges and recognizes that this
Agreement releases all claims existing or arising with respect to the 2001
Agreement, whether such claims are known or unknown and suspected or
unsuspected. All such claims are forever barred by this Agreement. Each party
acknowledges that it understands the significance and consequences of such
release and such specific waiver of Section 1542 of the California Civil Code.
7. Severability. Should any provision, part or term of this Agreement be
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held to be invalid or unenforceable, the validity and enforceability of the
remaining parts, terms and provisions shall not be affected thereby, and a
suitable and equitable provision shall be substituted to carry out, so far as
may be enforceable and valid, the intent and purpose of the invalid or
unenforceable provision.
8. Entire Agreement. This Agreement contains the entire agreement between
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the parties relating to the subject matter hereof and supersedes any prior or
contemporaneous agreement or understanding, whether written or oral, with
respect to the subject matter hereof. Any oral representation or modification
concerning this Agreement shall be of no force or effect. This Agreement can be
modified only by a writing signed by the parties hereto.
9. Governing Law. It is understood and agreed that this Agreement shall be
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construed for all purposes in accordance with the laws of the State of
California.
10. Counterparts. This Agreement may be signed in counterparts, each of
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which shall be deemed to be an original, but all of which shall together
constitute one and the same instrument. A faxed signature shall be valid in lieu
of an original. Copies of each signed counterpart may be used in lieu of the
originals for any purpose.
11. Attorneys' Fees. If either Party commences an action or proceeding to
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determine or enforce its rights hereunder, the prevailing Party shall be
entitled to recover from the losing Party its reasonable attorney's fees,
expenses, and costs.
12. Due Authorization. Each party has all requisite power, authority and
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approvals required to enter into, execute and deliver this Agreement and to
perform fully its obligations hereunder and thereunder.
"REMEDENT"
REMEDENT, INC.:
By: /s/ Guy De Vreese
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Its: Chairman of the Board
"MARINE":
/s/ Xxxxxxxx Marine
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Xxxxxxxx Marine
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