Diligence and Valuation Report OTC US

Arrowhead Code: 71-01-04 Company: REMEDENT Inc. Coverage initiated: March 20, 2017 Ticker: OTC: REMI This document: January 22, 2019 Headquarters: Ghent, Belgium Fair share value bracket (DCF) USD 0.19 – USD 0.24 CEO: Guy De Vreese Share price (Jan. 21, 2019): USD 0.20i Clinical Director: Dr. Evelyne Jacquemyns Analyst Team Parvati Rai Sumit Wadhwa CFO: Philippe Van Acker +1 212 619-6889 +1 212 619-6889 [email protected] [email protected] Website: www.remedent.com

Market Data Arrowhead is updating coverage on Remedent with a fair value of USD 0.19 in the low bracket and USD 0.24 in the 52-Week Range: USD 0.15– USD 0.33ii high bracket scenario using the Discounted Cash Flow Average Daily Volume (3M Avg.): 3,439.98iii (DCF) valuation method. Market Cap (January 21, 2019): USD 3.99 mn Key Highlights: (1) Remedent is a leading manufacturer Financial Forecast (in USD) (FY Ending – Mar.) of cosmetic products in Europe and Asia. (2) The company produces custom-made, high-quality, ultra-thin USD mn '19E '20E '21E '22E '23E '24E '25E veneers that stick to the front of the teeth and maintain a High NI (mn) 230 319 394 471 561 664 781 healthy tooth structure. (3) The veneers are designed High EPS 0.01 0.02 0.02 0.02 0.03 0.03 0.04 using CAD/CAM and fabricated from IPS Emax material Low NI (mn) 215 300 370 444 527 620 725 from Ivoclar. (4) GlamSmile veneers are the key products Low EPS 0.01 0.01 0.02 0.02 0.03 0.03 0.04 in the oral care and cosmetic dentistry segment and are sold to professionals through third-party distributors and to Company Overview: Remedent Inc. is a global dental consumers through its GlamSmile Studios. (5) Remedent product manufacturer and distributor of oral care and generated 100% of its Q2 2019 revenue from customers cosmetic dentistry products offering porcelain veneers, and outside of the US. (6) North American revenues were hit in teeth whitening solutions and products to Q2 2019 as the company has actively reduced its marketing dental professionals as well as patients. SmileWise, effort on Condor 3D Scanner in anticipation of launching a Remedent’s latest direct-to-consumer community outreach new easy-to-use version of the scanner with additional strategy is designed to help it establish a captive features. (7) The company’s cash balance declined to USD marketplace for its products. The company offers SmileMe 55,119 at the end of Q2 2019 from USD 92,875 at the end Mirror, a dental imaging software, and is the distributor of of FY 2018. (8) Its new SmileWise outreach initiative could Condor, an intra-oral 3D diagnostic scanner, primarily in drive sales growth by providing a marketplace, consumer North America. Headquartered in Belgium, Remedent awareness and boost demand for its products. (9) ~23% manufactures, markets and distributes its products and of the outstanding common stock is owned by the concepts to dental professionals and customers in more company’s management. than 35 countries in Europe, Asia, Middle East and North America (the US). The company has manufacturing facilities Key Risks: Key risks include cash flow uncertainty; in Ghent, Belgium, and Beijing, China. technological obsolescence in competitive markets; risk associated with currency fluctuations and regulatory Q2 2019 Results: Remedent’s revenue declined sharply by approval for medical devices. 49% year-on-year (YoY) to USD 345,640 in Q2 2019 from USD 678,694 in Q2 2018, mainly due to the reduced sales Valuation and Assumptionsiv: Given due diligence and of Condor 3D Scanner in the North American market. The valuation estimates, Arrowhead believes that Remedent’s company has slowed down its sales in the US as it plans to fair share value lies in the USD 0.19 to USD 0.24 bracket launch an improved version of the scanner soon, which is calculated using DCF methodology. Based on Relative expected to dramatically enhance performance and create Valuation, the fair value lies in the USD 0.23 to USD 0.28 ease of use for the operator. The company reported a net bracket. loss of USD 83,104 in Q2 2019 as compared to a net profit of USD 55,956 in Q2 2018 due to trickle-down impact of low sales.

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Table of Contents 1. SUMMARY AND OUTLOOK ...... 4 2. BUSINESS OVERVIEW ...... 5 2.1 Company Milestones ...... 8 2.2 Business Model ...... 9 2.2.1 B2B Strategy ...... 10 2.2.2 B2C Strategy ...... 10 2.3 Products and Services Offered ...... 11 2.3.1 SmileWise ...... 11 2.3.2 GlamSmile ...... 11 2.3.3 SmileMe Mirror ...... 11 2.3.4 Condor Scanner ...... 12 2.3.5 Condor Perspective ...... 12 2.3.6 River8 ...... 12 2.4 Corporate Strategy ...... 12 2.5 Company Premiums ...... 12 2.6 Company Risks ...... 13 2.7 Future Outlook ...... 13 2.7.1 Owned Centres ...... 13 2.7.2 Licensed Centers ...... 14 2.7.3 Distributors ...... 14 2.8 Shareholding Pattern ...... 14 2.9 Listing and Contact Details ...... 14 3. NEWS ...... 15 4. MANAGEMENT AND GOVERNANCE ...... 16 5. INDUSTRY OVERVIEW ...... 17 5.1 Segments and Procedures in Cosmetic Dentistry ...... 17 5.2 Demand drivers ...... 18 5.2.1 Factors driving cosmetic dentistry demand ...... 18 5.2.2 Reasons patients cite for wanting cosmetic dentistry treatments ...... 19 5.2.3 Issues of primary concern for patients ...... 19 5.2.4 Preference for Material ...... 19 5.2.5 Treatment frequency of a procedure/ treatment ...... 20 5.2.6 Most popular cosmetic procedure at a practice ...... 20 5.2.7 Usage of a chairside CAD/CAM system ...... 20 5.3 Market Trends ...... 20 5.3.1 3D Dentistry ...... 20 5.3.2 Made-to-Order ...... 20 5.3.3 Preference for less-invasive methods ...... 21 5.3.4 Porcelain Veneers ...... 21 5.3.5 Professional cleaning and whitening ...... 21 5.4 Future Outlook ...... 21 5.4.1 Growth prospects ...... 21 5.4.2 Digital Dentistry ...... 21 5.5 Markets in Europe, Asia and the US ...... 22 5.5.1 Market in Europe ...... 22 5.5.2 Market in Asia ...... 22 5.5.3 Market in U.S...... 22 5.6 Regulatory Framework ...... 22 5.6.1 Regulatory body in Europe ...... 22 5.6.2 Regulatory body in China ...... 23 5.6.3 Regulatory body in the US ...... 23 5.7 Competitive Landscape ...... 23 6. VALUATION ...... 24 6.1 Discounted Cash Flow Method ...... 24

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6.2 Relative Valuation ...... 25 6.3 Blended Valuation ...... 25 7. APPENDIX ...... 27 7.1 Remedent’s Financial Summary ...... 27 8. ANALYST CERTIFICATIONS ...... 29 9. NOTES AND REFERENCES ...... 30

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1. Summary and Outlook We are updating coverage on Remedent. The company, headquartered in Belgium, specializes in the design, manufacture and distribution of oral care and cosmetic dentistry products. The company’s fair value is USD 0.19 in the low bracket scenario and USD 0.24 in the high bracket scenario (DCF Valuation Method). Based on the relative valuation method, the fair value lies in the USD 0.23 to USD 0.28 bracket.

Key Highlights:

1. Remedent is a global manufacturer and distributor of cosmetic dentistry products, which include a full line of professional veneers, teeth whitening solutions and oral hygiene products. The company distributes its products and concepts to dental professionals in more than 35 countries, in Europe, Asia, Middle East and North America (the US), using both its internal sales force and third-party distributors. The company’s core operating segment is dental and oral hygiene products sold by Remedent, Remedent N.V., and Biotech Dental Benelux N.V. 2. Remedent Inc. operates through both B2B and B2C models, delivering products to the dental professionals, as well as enabling patients to improve their smiles through its Smile Consultancy Concept. The company’s key product offerings include – SmileWise, GlamSmile veneers (custom-made veneers), SmileMe Mirror (a dental imaging software), Condor (intra-oral 3D scanner), Perspective, and River8. 3. The company’s growth strategy is to focus on strengthening its presence in Europe and Asia (mainly China), while establishing a direct consumer presence in the US. It generated 82% and 100% of its sales from Europe and Asia in FY 2018 and Q2 2019, respectively. Remedent’s present strategic marketing and distribution plan includes a combination of owned and licensed GlamSmile centers depending upon the size and location of the market, with its managing the marketing efforts, patient communications and sales process. Further, the company plans to launch an advanced version of its scanner, which will be easier to use and will enhance operator performance dramatically. 4. The company entered an agreement with Condor Technologies NV in 2017, on account of which Remedent acts as a distributor of its 3D dental scanners in North America. The scanner is a decisively different scanner, which enables dental practitioners to provide tailored treatment to their patients, thereby creating cross-selling and monetization opportunities for both the practitioners and the company. The Condor scanner is a first-of-its-kind scanner, as it is software-based, compact, user-friendly, cost-efficient and features hyper-realistic colors for diagnostic and treatment planning purposes. The company, through this deal, plans to reinforce its competitive positioning in the US market, and penetrate the market. It expects this deal to be a major driver of its top-line growth in the near term. 5. In 2018, Remedent restructured its business model to focus on dental products targeted at the professional sector. Under the professional oral care and cosmetic dentistry product segment, Remedent’s key offering is the GlamSmile veneer. The company’s current key business strategy is to focus on selling the GlamSmile veneers directly to consumers through vertical integration of development, manufacturing and marketing resources. 6. As a part of the restructuring to facilitate its growth strategy, the company plans to re-organize its subsidiaries to better manage the GlamSmile operations. In this regard, it intends to have the intellectual property and other assets related to GlamSmile contributed to the formation of a new entity called GlamSmile Worldwide. New entities called GlamSmile Asia and GlamSmile Europe, each with licensed rights to use and exploit the GlamSmile technology in their respective territories, will also be created. 7. Financial Overview: In Q2 2019, Remedent’s revenue dropped sharply to USD 345,640 from USD 678,694 in Q2 2018 mainly due to weak sales of Condor 3D Scanner in the North American market, owing to the expected launch of a newer and more advanced version of the scanner. Gross profit mirrored the trend in top-line and declined by 52.4% to USD 229,104 in Q2 2019 from USD 480,994 in Q2 2018. As a result, the company’s gross margin, or gross profit as a percentage of sales, also declined notably to 66.3% in Q2 2019 from 70.9% in Q2 2018. On the cost side, general and administrative expenses dropped substantially by 33.1% YoY to USD 175,354 due to increased synergies because of the ongoing internal reorganization. The company reported a net loss of USD 83,104 in Q2 2019 as compared to a net profit of USD 55,956 in Q2 2018. 8. Cash and cash equivalents at the end of Q2 2019 stood at USD 55,119, down from USD 92,875 at the end of FY 2018. Remedent foresees the need to raise fresh funds to manage its working capital requirements to implement its expansion strategy focused on a direct-to-consumer business model. Key risks: Key risks include risk from creditors and suppliers due to concentration; risk of loss on revenue as major shares are vested with a few customers; regulatory compliance failure; adverse impact of currency fluctuation.

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2. Business Overviewv Remedent, headquartered in Belgium, is a leading manufacturer of cosmetic dentistry products in Europe. The company is a manufacturer and distributor of dental and oral hygiene products, offering a full line of professional veneers, teeth whitening solutions and oral hygiene products. It specializes in the designing and manufacturing of oral care and cosmetic dentistry products and concepts that are distributed to dental professionals and customers in more than 35 countries through a combination of internal sales force and third-party distributors. The company has an in-house manufacturing facility in Ghent, Belgium and outsourced manufacturing facility in Beijing, China.

Remedent Inc. focuses on both B2B, and B2C markets. It focuses on selling products directly to the dental professionals through third-party distributors (B2B) and through the direct-to-consumer model (smile consultancy concept) to customers (B2C). Earlier, the company used to sell its GlamSmile products globally, barring a few territories, due to a restrictive distribution agreement with Den-Mat. However, the distribution agreement with Den-Mat was terminated, granting the latter an irrevocable, perpetual, non-exclusive, royalty free license to sell within certain territories, excluding China, Hong Kong, Macau and Taiwan. Accordingly, Remedent currently sells its products in Europe, Asia and the Middle East using a direct-to-consumer model, via its GlamSmile Smile Design - Virtual Studio and GlamSmile Studios.

The company has four key products which include – GlamSmile veneers (custom-made veneers), River8 (a prefabricated veneer), SmileMe Mirror (a dental imaging software) and Condor (intra-oral 3D scanner). In addition to this, the company has launched a direct-to-consumer community outreach strategy, SmileWise, which is designed to bring awareness among patients about their smile and overall dental health. This marketing initiative is aimed at bridging the gap between customers and dentists and establishing a captive marketplace for Remedent’s products.

In January 2010, Remedent had acquired 50.98% interest in GlamSmile Dental Technologies, largely to gain exposure in GlamSmile Asia as it had certain licenses that would enable the company to sell its products and concepts in the China and gain a footing in the Chinese market. Later, the company sold 2.5 mn shares of its investment in GlamSmile Dental Technologies for a sum of USD 3 mn. Consequently, the company currently has a 21.51% ownership in GlamSmile Dental Technologies. In 2017, Remedent entered into an agreement with Condor Technologies NV and became a distributor of Condor, an intra-oral 3D dental scanner, in North America and Canada. The company will offer the scanner to dentists in its home market, enabling them to provide customized treatments for their patients, while creating cross-selling and monetization opportunities for themselves and the company. The Condor scanner is a first-of-its-kind scanner as it is based on a software, smaller in size, user-friendly, cost-efficient and features hyper-realistic colors for diagnostic and treatment planning purposes. With this deal, Remedent aims to strengthen its competitive positioning in the US and gain a sizeable share of the market. It expects this deal to become a key driver of its future growth. Earlier this year, Remedent had deleveraged its balance sheet by settling the outstanding secured debt of its key creditors, Excelsior Medical (HK) Co. Ltd. and Asia Best Healthcare Co. Ltd. Both the parties had agreed to waive the repayment of the remaining debt that in total stands at 50% of the principal amount. Under the agreement, Remedent remitted USD 0.5 mn to each of the creditors to pay off the remaining USD 2.2 mn of debt and accrued interest outstanding. With the retirement of all bank debt, credit lines and commercial debt, the company has strengthened its balance sheet and plans to implement new digital strategies. Financial Overview: In Q2 2019, Remedent’s revenue declined steeply to USD 345,640 from USD 678,694 in Q2 2018, representing a decline of 49% YoY. This was mainly due to reduced sales of Condor 3D Scanner in the North American market as the company moves closer to the launch of an improved version of its scanner to enhance performance and create ease of use for the operator. The company’s gross profit also dropped sharply to USD 229,104 from USD 480,994 in Q2 2018, a fall of 52.4% YoY. Accordingly, the gross margin fell to 66.3% in Q2 2019 from 70.9% in Q2 2018. In terms of operating expenses, the R&D expenses decreased to zero in Q2 2019 primarily because of the finalization of its software program, SmileMe Mirror. Sales and marketing costs also declined by 41.1% to USD 141,473 in Q2 2019 from USD 240,057 in Q2 2018, largely due to reduced marketing and advertising costs in anticipation of an additional tool for the Condor 3D Scanner to be launched by the beginning of 2019. General and administrative costs dropped substantially by 33.1% YoY in Q2 2019 to USD 175,354 due to increased synergies owing to the ongoing internal reorganization. The company reported a net loss of USD 83,104 in Q2 2019 as compared to a net profit of USD 55,956 in Q2 2018 mainly because of lower sales.

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Remedent’s cash and cash equivalents reduced to USD 55,119 at the end of Q2 2019 from USD 92,875 at the end of FY 2018. The company’s operations are primarily concentrated in Europe and Asia and 82% and 100% of its sales for FY 2018 and Q2 2019, respectively, were generated from customers outside the US.

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Exhibit 1: Corporate Structurevi

Remedent

Remedent Remedent Professional Remedent NV Professional Inc. Holdings Inc.

21.51% GlamSmile 50% Biotech Dental Tech Dental Benelux NV

100% Beijing GlamSmile Technology Development Ltd.

80% Beijing GlamSmile Trading Co.

98% Beijing GlamSmile Dental Clinic

100% GlamSmile 100% Shanghai GlamSmile Dental Clinic Ltd. (Asia) Ltd.

100% Guangzhou Dental Clinic

100% Wuhan Dental Clinic

50% Whenzhou Dental Clinic Ltd.

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2.1 Company Milestones

Exhibit 2: Remedent Milestones vii Year Event

1996 - Incorporated in September, under the laws of Arizona, under the name Remedent USA Inc.

- In October, acquired by Resort World Enterprises Inc., a Nevada corporation; immediately changed 1998 name to Remedent USA Inc. and later to Remedent Inc.

- Board of Directors approved a strategic plan to separate the OTC business from professional business to focus on the development, marketing and distribution of products for the professional dental market. 2008 - In December, completed the restructuring, in the form of a management-led buyout of 50% of OTC retail business (“2008 Restructuring”). - Following the restructuring, shifted focus to products targeted at the professional sector, with business targeting primarily the marketing and distribution of GlamSmile Veneers.

- In June, the Company entered the First Fit Distribution and License Agreement (the “First Fit 2009 Distribution Agreement”) with DenMat.

- In January, the company acquired 50.98% of the issued and outstanding shares of GlamSmile Asia Ltd. to enter and expand into the Chinese Market. “GlamSmile Asia” or “GlamSmile” is a private Hong Kong company, with subsidiaries in Hong Kong and Mainland China. In January, formed a joint venture with Gallant Network Limited (“Gallant”) to formalize GlamSmile operations in China. 2010 - In March, based on a certain Amendment No. 1 to the First Fit Crown Distribution and License Agreement (“First Fit Amendment”) between the Company and DenMat, the company agreed to sell to DenMat all the intellectual property used by the company related to the First Fit product (“First Fit IP”).

- In January, the company entered into a Preference A Shares and Preference A1 Shares Purchase Agreement (“Share Purchase Agreement”) with GlamSmile Dental Technology Ltd., a Cayman Islands company and a subsidiary of the company (“GlamSmile Dental”), GlamSmile (Asia) Limited. - In addition, the company entered a distribution, license and manufacturing agreement with GlamSmile Dental, pursuant to which the company appointed GlamSmile Dental as the exclusive distributor and licensee of GlamSmile Veneer Products bearing the “GlamSmile” name and mark in the B2C market 2012 in the People’s Republic of China (including Hong Kong and Macau) and Republic of China (Taiwan), and granted related manufacturing rights and licenses. - In February, the sale of the Preference A1 Shares and the Preference A Shares was completed. Resultantly, the equity ownership of GlamSmile Dental was as follows: 31.4% by the investors, 39.2 % by Gallant and 29.4% by the company. - The company sold 100% of its interest in Remedent OTC BV.

- In February, Remedent signed an exclusive agreement with France’s Biotech Medical Aesthetic SAS to distribute its River8 veneers worldwide. Biotech International is a market leader in dental and orthopedic surgery implants in more than 40 countries. 2013 - The company acquired 6.12% of the issued and outstanding shares of Medical Franchises & Investments NV, a Belgium corporation ("MFI NV"). Later, the name of MFI NV was changed to Condor Technologies NV.

- In January, the company sold a total of 2.5 mn ordinary shares of its investment in GlamSmile Dental Technology Ltd. Effective from March 31, 2014, the company has retained 21.51% ownership in GlamSmile Asia Ltd. 2014 - In January, the company invested in the start-up capital of Biotech Dental Benelux NV, a Belgium corporation, in exchange for 50% of its shares. Biotech Dental Benelux has been founded to market and sell dental implants in Belgium, Netherlands and Luxemburg.

- Entered an agreement with Vitaldent (Spain & Italy) to provide GlamSmile Veneers and proprietary 2015 tray technology for 5 years.

2017 - Entered an agreement with Condor Technologies NV wherein Remedent will be a distributer of 3D dental scanners in North America

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- Invested in the start-up of Newco Condor North America, LLC, a Nevada corporation, which was founded to market, distribute and sell the Condor intra-oral 3D scanner in North America. - Paid off the remaining balance of long-term debt obligations and deleveraged its balance sheet.

2.2 Business Model Remedent engages in the manufacture and sale of dental and oral hygiene products, including professional veneers, teeth whitening solutions and oral hygiene products. These products are sold directly to dental professionals through third-party distributors (B2B), and to consumers through its smile consultancy concept (B2C). The company has dealers in 30 countries covering Europe, Asia, Latin America, the Pacific Rim, the Middle East and the US. It uses a combination of dealer force, dealer assisted marketing and lead generation programs to reach professional dentists and over-the- counter markets in each country.

Earlier, the company sold its GlamSmile products globally, excluding a few territories due to a restrictive distribution agreement with Den-Mat. However, with the termination of the distribution agreement with Den-Mat in 2012, Remedent currently sells its products in Europe, Asia and the Middle East using a direct-to-consumer model, via its GlamSmile Smile Design - Virtual Studio and GlamSmile Studios.

Flagship Product – SmileWise

SmileWise is a direct-to-consumer dental awareness initiative to bridge the gap between the public and the dental community. The program utilizes a series of interactive questions and various digital imaging technologies to provide consultancy on a patient’s overall oral health. Further, the program is designed to be fun and engaging for the patient in addition to being informative of the health risks associated with improper oral health.

The primary focus of SmileWise is to be a dental marketplace and a marketing company.

- Corporate Sponsors – These are large corporate sponsorship opportunities for the entire program. Corporate sponsors can participate through a cost-support structure or a revenue-sharing model, depending on how it is positioned.

- Dental Insurance Companies – These companies could pay an annual sponsorship fee or commissions to promote their dental insurance products to the prospective corporations or offer them to individuals after the SmileWise assessment.

- Large Direct-to-Consumer Dental Brands – These companies could sponsor the program of participants with product promotions that would enhance the SmileWise experience in the form of freebies. For instance, companies such as Colgate, Oral B, etc., could use SmileWise as a channel to market their products.

- Marketing and Lead Generation – The ability to create new patient opportunities for local dentists could be a very lucrative opportunity for SmileWise. The local dentist will pay SmileWise monthly marketing fees for patient leads generated out of the SmileWise scanning drives. The fee would fluctuate based on the number of leads generated during a period.

- Franchise opportunity - A SmileWise Franchise opportunity would create a constant revenue stream in addition to eliminating the need to hire employees. The SmileWise call center can create opportunities within each of the franchise areas, creating a lead channel for the corporate partners. Individual franchise territories would be offered to qualified applicants who meet a pre-defined criterion. Each franchisee would pay a monthly fee and be equipped with the appropriate SmileWise equipment.

Patient communication and lead management

Patient communication and lead management would be done via a SmileWise App. At the time of the examination, the patient will be instructed to download the App. The App will create a Health Insurance Portability and Accountability Act (HIPPA) compliant link for the patient.

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The patient will receive their SmileWise assessment through this App. The patient will then be able to select their course of treatment through the App and be referred to participating SmileWise Dentists. The patient will also be able to communicate with the SmileWise call center executives to schedule a meeting with the dentist. A patient- specific code will allow the patient to be tracked throughout the lead generation process.

Post-marketing opportunities

Once the patient has gone through the SmileWise referral process, their data will be recorded in the SmileWise database. The patient will then be able to receive various offers from other strategic dental partners on an ongoing basis. The opportunity to sell ancillary product such as

- - Oral care products - Tray-based dentistry

As with any new marketing concept, the initial concept needs to be validated and cost metrics need to be run. Conservative estimates have been used to evaluate this model.

2.2.1 B2B Strategy Remedent primarily uses Distributor Assisted Marketing programs that involve identifying an established dealer in each market using a sales force familiar with the sale of capital equipment to the professional dentist community. After this, the company develops aggressive lead generation programs and other marketing techniques, which serve as a blue print for the dealers to implement. This approach is far more effective than utilizing a direct sales approach, which is slower and expensive to establish.

Exhibit 3: B2B Activity GlamSmile - A smile improvement system; has revolutionized the art of veneering and applying porcelain dental veneer

- Part of a multi-billion-dollar international growth market

- The technology involves using a proprietary veneer fabrication technique and a patented single-motion veneer placement tray. These are guided by a proprietary computer imaging, design and digital preview system

- The unique tray delivery system lets dentists expertly seat 10 ultra-thin, custom veneers in less than an hour, while preserving the tooth structure

- Sells GlamSmile veneer concept to dental professionals in 18 countries through distributors

- Sells to the rest of the world through a strategic partnership with Den-Mat Holdings LLC - Since the formation of the partnership, Den-Mat brings the Remedent technology to its customers under the brand name, Lumineers by LumiTray

2.2.2 B2C Strategy The direct-to-consumer model is based on a one-to-one relationship with Smile Consultants, who manage the sales process from lead acquisition to final sale. The company develops close partnerships with dedicated GlamSmile dentists. They also establish the GlamSmile Studios, which are concept studios with a focus on aesthetic and cosmetic dentistry. The partner dentists focus on patient satisfaction and are relieved from any sales responsibilities.

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Exhibit 4: B2C Activity Smile Consultancy Concept GlamSmile Beijing - The program targets consumers who want to improve - Remedent has entered a partnership with their smile without any dental treatment. GlamSmile Beijing. They conduct two important - It provides free consulting through a Smile Coach, who activities: further guides the consumer to the right GlamSmile o GlamSmile Clinic: The clinic offers a Studio or GlamSmile partner dentist. The complete variety of cosmetic dental procedures, sales cycle is taken over by Remedent. such as GlamSmile veneers, whitening, - The approach is predominantly marketed on the invisible braces, crowns, bridges. internet through its website, GlamSmile Smile Design. o GlamSmile Laboratory: Founded in It focuses on intensive campaign and advertisement to January 2009, the Beijing Lab designs direct maximum traffic to the website that promotes and produces veneers for worldwide GlamSmile Whitening, Veneers and Free Smile Advice. delivery. The increasing demand for - Remedent is looking to expand its B2C concept the product makes it the most worldwide, including in the US. In Q2 2019, 100% important production facility for revenue was generated from customers outside the GlamSmile veneers. US.

2.3 Products and Services Offered Remedent offers four key products which include – SmileWise, GlamSmile veneers (custom-made veneers), SmileMe Mirror (a dental imaging software) and Condor (intra-oral 3D scanner), and River8 (a prefabricated veneer). These products are sold to dental professionals through third-party distributors and directly to consumers through its GlamSmile Studios. Additionally, the company offers a direct-to-consumer community outreach strategy, SmileWise, which is aimed at creating awareness among patients about their smiles and overall dental health.

2.3.1 SmileWise SmileWise is Remedent’s latest marketing initiative that is aimed at bridging the gap between the dental community and patients by creating awareness about their overall oral health. SmileWise uses hyper realistic 3D color images that have a strong impact on the patient. From oral hygiene, broken or cracked teeth to periodontal issues to bleaching or cosmetic procedures, SmileWise works with a network of dental professionals to provide the best treatment options for these patients. This message is quickly spread through the increasing power of social media, enabling patients to communicate with key dental influencers for advice and making informed decisions. SmileWise brings the patients closer to the dental professionals, thereby creating a marketplace for its dental products.

2.3.2 GlamSmile GlamSmile, a smile improvement system, involves a proprietary veneer fabrication technique and a patented single-motion veneer placement tray guided by a proprietary computer imaging, design and digital preview system. The unique tray-delivery system allows simple, fast seating of a full arch of high-quality, ultra-thin veneers, in a single movement. Unlike traditional one-veneer-at-a-time placement methodology, proprietary GlamSmile technology makes creating a smile with veneers a time-saving, comfortable treatment for the dentist as well as the patient. The high-quality GlamSmile veneers provide a fast, painless and affordable cosmetic dental solution for patients with severely stained, misshapen, chipped, misaligned and discolored teeth.

2.3.3 SmileMe Mirror SmileMe is a dental imaging software that takes images of the patient’s face and smile and enables dentists to offer smile consultancy quickly. A stimulation software, Smile Sketch, sketches out the patient’s ‘before’ and ‘after’ smile and allows them to visualize the full potential of their smile. Then a Smile Analysis, which involves 13 carefully-crafted questions, is conducted to better understand the patient’s desired smile. Finally, the dentist provides Smile Consultancy, suggesting various treatments that the patients can undertake to have the smile they want. It is one of the easiest and quickest simulation tool available in the

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industry and is a fun and interactive way for patients to consider a cosmetic dentistry treatment.

2.3.4 Condor Scanner Condor is a portable intra-oral 3D diagnostic scanner that creates realistic color images of the patient’s teeth and smile. Condor is a first-of-its-kind scanner with a compact size and affordable price. It is based on a software concept similar to artificial intelligence, and its imaging algorithms are upgraded from time to time so that the scanner is fast, accurate and easy to use for the operator. The scanner uses hyper-realistic colors for diagnostic and treatment planning purposes, making CAD/CAM dentistry more efficient and enabling the dentists to provide better care, from diagnosis to restoration. The open .stl file allows the patients to collaborate with any laboratory in the world and make informed decisions.

2.3.5 Condor Perspective Condor Perspective is a collaborative software that allows SmileWise to communicate with patients and dental professionals. Condor scanner creates 3D hyper-realistic images of the patient’s teeth and smile and converts them into open .stl files that the patients can use to collaborate with any dentist in the world to decide a treatment. Once these files are generated, Remedent’s SmileWise helps the patients to communicate a network of dental professionals through a software, Condor Perspective, and decide on the best treatment option to get the smile they want.

2.3.6 River8 River8 is a truly affordable porcelain veneer solution for discolored, damaged, stained or misaligned teeth. This latest porcelain veneer technology is radically transforming cosmetic dentistry worldwide, achieving a whitening result that lasts without bleaching.

River8 veneers come in Smile Boxes for the dentist, each containing a set of eight veneers to cover the smile zone of almost any upper and lower arch. With a staggering range of 264 veneer options (three different shapes, sizes and shades for the upper teeth, and one shape, two sizes and three shades for the lower teeth), River8 has the largest “Instant Veneer” assortment worldwide to perfectly match the patient’s expectations ensuring maximum results for smile customization. All this in is done in only two short visits due to the positioning tray, which causes no pain, requires no anesthetic, and maintains the healthy tooth structure of the patient. River8 is produced by Remedent and globally distributed by Biotech International which is already active in over 40 countries as market leader in dental and orthopedic surgery implants.

2.4 Corporate Strategy The company’s current business strategy is to focus on selling the GlamSmile veneers directly to consumers through vertical integration of development, manufacturing and marketing resources. The company intends to use direct response media, including internet, social network media, print, radio and television. Remedent plans to expand its presence in Europe and Asia (mainly China), and to establish a direct-to-consumer presence in the US.

2.5 Company Premiums - Change in strategic focus to B2C segment: Remedent’s core competencies lie in its knowledge of the dentistry market and its advanced technological capabilities. The company is focusing on selling its GlamSmile veneers directly to consumers by using all forms of direct response media. The company plans to expand its presence in Europe and Asia, and establish a direct-to-consumer presence in the US. - Strong geographical presence and expertise: The company is a leading manufacturer in Europe for cosmetic dentistry products, and specializes in research, development and manufacturing. The company leverages its management’s experience and the knowledge of regulatory requirements to design, develop, manufacture and distribute its products in Europe, Asia, Middle East and the US. - Income from equity investment in subsidiaries: The company earned equity income from its investment in GlamSmile Dental Technology Ltd., to the tune of USD 30,667 in Q2 2019 compared with USD 112,480 in Q2 2018.

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2.6 Company Risks - Suppliers’ risk: The company had five suppliers who accounted for 49.10% of gross purchases for the first six months of FY 2019, a decline from 61.28% for the first six months of FY 2018. - Concentration of customers: At the end of Q2 2019, the company had five customers contributing 87.49% of the company’s total trade receivables, wherein two of the five customers accounted for 81.08% of total accounts receivable. This is a sharp increase from five customers accounting for a total of 79.06% of the company’s trade accounts receivable and two of those customers accounting for 68.83% of total accounts receivable at the end of Q2 2018. - Currency fluctuations: The company has operations in Belgium and sells its products in Europe, the Middle East and Asia. A major portion of its revenue is in currencies other than the US Dollar (“USD”). These include Euro, Hong Kong Dollar and the Chinese Renminbi (“RMB”). The company’s financial statements are reported in USD, and fluctuation in Euro, Hong Kong Dollar and RMB against the USD may cause significant foreign currency transaction gains and losses. - Government regulations: International sales of medical devices need to comply with the regulatory requirements of each country. For instance, approval from the Food and Drug Administration (“FDA”) in US, CE Mark in Europe and registration by the State FDA (SFDA) in China. The company relies on its distributors, sales representatives and strategic partners to ensure compliance with regulatory laws in its countries of operation. - High concentration of ownership with the company’s management: Approximately 23% of outstanding common stock is owned by the present directors and executive officers, which include underlying options that could be exercised or would become exercisable within 60 days. Therefore, they have significant influence in all matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions.

2.7 Future Outlookviii The company’s key growth strategy is to focus on its direct-to-consumer sales, while strengthening its presence in Asia and Europe, and establishing a direct-to-customer presence in the US.

- Restructuring of subsidiaries: The company intends to restructure its subsidiary companies to have the intellectual property and other assets related to GlamSmile contributed to a new entity, to be formed and called GlamSmile Worldwide. Other new entities to be created are GlamSmile Asia and GlamSmile Europe – each with licensed rights to use the GlamSmile technology in their respective territories. - Marketing efforts: The company intends to make use of ‘before’ and ‘after’ photos using GlamSmile veneers to emphasize on the results attained. The company also plans to feature an “Until You Smile” satisfaction guarantee. The concept of using a "Smile Consultant" has been a success in China and Belgium. This will be replicated to maintain control of the sales process and to close sales. The current strategic marketing and distribution plan includes running a combination of owned and licensed GlamSmile centers depending on the size and location of each market. - Distribution: The distribution will be done in two ways – via owned and operated GlamSmile Studios or affiliations with existing dental practices and partner retail centers in Asia, Middle East and Europe. The company will manage the marketing efforts, patient communications and sales process. Remedent has established two geographic divisions, Asia and Europe, and each will promote GlamSmile veneer treatments in their respective territories. - Centers: The company plans to establish three types of GlamSmile Centers, depending on market factors and government regulation. 2.7.1 Owned Centres The company will own, control and manage all aspects of the operation in these centers and will either employ or enter contracts with dentists to perform the necessary dental services. In China, the company will continue to rely on owned- and-operated GlamSmile dental clinics.

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2.7.2 Licensed Centers In markets other than China, the company will recruit cosmetic dentists with existing practices to endorse the GlamSmile veneer products. These contracts with dental practices will recognize revenue through sale of veneer trays and marketing and other fees, to be charged by the company to the dentist, for services performed. 2.7.3 Distributors In markets where the company lacks the expertise in marketing or local regulation puts constraints on an owned or licensed center approach, the company will appoint distributors. These distributors will be granted exclusive rights to market and distribute GlamSmile products directly to consumers, with minimum performance criteria and/or initial territory fees. But these distributors will be expected to invest in all marketing and sales conversion costs in their market. The revenues will be derived from sales of GlamSmile veneer products to the distributor.

2.8 Shareholding Pattern The company had 19,995,969 shares of common stock issued and outstanding on January 21, 2019.

Exhibit 5: Shareholding Pattern (on Jan. 21, 2019) ix Exhibit 6: Shareholding Pattern x No. of % of Shareholders Shares total 23.7% Guy De Vreese, CEO, De Vreese Guy Chairman 4,733,680 23.7%

Sternberg Stuart Sternberg Stuart 3,011,534 15.0% 60.8% Kolsteeg Fred Fred Kolsteeg, Director 95,000 0.5% 15.0% Others 0.5% Other 12,155,755 60.8% Total Shares 19,995,969 100.0% Outstanding

2.9 Listing and Contact Details Remedent is listed on Over-the-Counter Bulletin Board (NYSE-Euronext) in Paris (Ticker: REMI, Date of Listing – December 17, 2007) Company Contacts Address: Zuiderlaan 1-3 box 8, 9000 Gent - Belgium Contact No: +32 9 241 58 80 Fax: +32 9 241 58 99 Email Id: [email protected]

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3. News xi - Announced Q2 2019 results: Remedent’s revenue declined sharply by 49% YoY to USD 345,640 in Q2 2019 from USD 678,694 in Q2 2018 mainly due to the reduced sales of Condor 3D Scanner in the North American market. Gross profit mirrored the trend in top-line and decreased by 52.4% in Q2 2019 to USD 229,104 from USD 480,994 in Q2 2018. Accordingly, the company’s gross margin also declined to 66.3% in Q2 2019 from 70.9% in Q2 2018. General and administrative expenses dropped substantially by 33.1% YoY in Q2 2019 to USD 175,354 due to increased synergies because of the ongoing internal reorganization. The company reported a net loss of USD 83,104 in Q2 2019 as compared to a net profit of USD 55,956 in Q2 2018. The company’s cash balance declined to USD 55,119 at the end of Q2 2019 from USD 92,875 at the end of FY 2018.

- Announced Q1 2019 results: Remedent’s revenue declined sharply by 45% YoY to USD 434,848 in Q1 2019 from USD 791,339 in Q1 2018. Gross profit decreased by 28.1% in Q1 2019 to USD 329,314 from USD 458,167 in Q1 2018 due to the reduced sales described above. The company reported a net loss of USD 156,290 in Q1 2019 as compared to a net profit of USD 68,069 in Q1 2018. Cash and cash equivalents declined of USD 75,860 at the end of Q1 2019 from USD 92,875 at the end of FY 2018.

- Announced FY 2018 results: Remedent’s revenue grew by 14.6% YoY to USD 2.7 mn in FY 2018 from USD 2.4 mn in FY 2017. The company’s gross profit increased sharply by 50.4% YoY to USD 1.8 mn in FY 2018 from USD 1.2 mn in FY 2017, driven by the increase in the non-recurring provision for obsolescence reserve. The cash and cash equivalent of the company declined to USD 92,875 at the end of FY 2018 from USD 1.5 mn at the end of FY 2017. Further, the company reported a net loss of USD 54,591 in FY 2018 from a net profit of USD 844,370 in FY 2017.

- SmileWise signed the 1st customers in the UK – During the second half of 2018, the SmileWise team started to sign up Partnering Clinics across the UK, primarily by hosting online appointments. The company signed 6-month contracts, priced at GBP 1,000 to GBP 2,000 per month. Remedent estimated a total of 120 clinics to be signed by the official launch in September 2018.

- Remedent deleverages its balance sheet: Remedent entered into an agreement with Excelsior and ABH on March 20, 2017, to settle outstanding secured debt. Excelsior and ABH agreed to waive the repayment of the remaining debt that stood at 50% of the principal amount due. Under the agreement, Remedent agreed to remit USD 1 mn to its creditors to pay off the remaining USD 2.2 mn of debt and accrued interest outstanding. Accordingly, a USD 0.50 mn payment was made by Remedent to each creditor at the beginning of the month. The company effectively paid off the remaining balance of its long-term debt obligations and deleveraged its balance sheet.

- Remedent launched the Condor intra oral dental scanner in North America: Remedent entered into an agreement with Condor Technologies on April 11, 2017, to launch and distribute its 3D dental scanner in North America. The condor scanner was a first-of-its-kind scanner and was decisively different from other scanners as it was software-based, patient-friendly, and smaller than other scanners. Remedent believed that its affiliation with Condor Technologies would strengthen its competitive positioning in the US market; would be a major driver for its future growth; and would ultimately help in gaining market share. Remedent was well-positioned to offer dentists in the US a scanner that would enable them to provide customized treatments to their patients and create cross- selling and monetization opportunities for themselves and for Remedent.

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4. Management and Governance xii The Management and Governance team has vast experience in the dental product industry and in managing operations and finance for multiple businesses. They also possess extensive background in investment matters.

Exhibit 6: Management and Governance Name Position Experience  He is the Executive Director at Condor International since July 2014.  He is serving as the Chairman of the company’s board since June 2002.  He has served as President of Remedent NV and President of DMDS Guy De Vreese CEO Ltd., a European subsidiary of Dental & Medical Systems Inc.  He worked as CEO from 1996 through February 1999 for Lident NV, a Belgian company that merged with DMD. In 1996, he founded DMD NV, a Belgian company that was the independent European distributor for DMDS products.

 He has served as a director of the company since April 2002.  He has served as the president of WAVE Communications, a Dutch based advertising agency, since 1996. Fred Kolsteeg Director  Prior to founding WAVE in 1996, he founded several other advertising agencies such as ARA, Team and Team Saatchi.  He has earlier worked at Phillips and Intermarco Publicis.

 He has served as a Director of the company since December 2008.  He has served as a Director of Finance for DMDS Ltd., a European Director, CFO, Chief Philippe Van Acker subsidiary of Dental & Medical Diagnostic Systems Inc. Accounting Officer  He has held various positions with Pfizer Medical Technology Group.

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5. Industry Overview Cosmetic Dentistry Industryxiii Cosmetic dentistry encompasses enhancement of the appearance of teeth and peoples’ smiles, wherein cosmetic dentists address functional and aesthetic concerns of patients. Treatments can be used to straighten, lighten, reshape and repair teeth. Cosmetic dentistry requires a combination of a good eye, understanding of dental anatomy, and mastery of dental materials. Also, the dentist is required to communicate the vision to a laboratory technician. Cosmetic dentistry is not recognized as a within the dental profession. However, cosmetic dentists are affiliated with a professional organization that provides necessary accreditation. Both Cosmetic and may have overlaps such as use of implants and crowns, but the focus and expertise required for both are different. A cosmetic dentist goes beyond restoration of teeth for proper function by also focusing on the look and feel outcome.

Global Market Sizexv The global market of the cosmetic dental industry is expected to Exhibit 7: Cosmetic Dentistry market size grow at a CAGR of 6.3% from USD 16.1 bn in 2015 to reach USD (USD B)xiv 27.9 bn by 2024. More people opting for esthetic dental procedures

has led to the development of advanced technologies. A few of the 27.9 most frequent treatments undertaken are teeth whitening, change 22.4 in dental appearance and intervention of malocclusion. Dental tourism has caused the cosmetic dentistry to prosper globally. 16.1

Macroeconomic factors The growth in this market can be attributed to rising disposable incomes of the middle-class population, growing consumer awareness about cosmetic dentistry, and rising focus on dental 2015A 2020E 2024E esthetics. However, lack of reimbursement options for cosmetic procedures and expensive cost of dental imaging are factors causing restraint in the market. Cosmetic procedures are not regarded as essential by insurance companies and government agencies and hence, reimbursement options are not readily available for cosmetic dentistry. Technologically advanced equipment, a prerequisite for dental imaging, requires huge investments. Such investments are not covered by insurance companies; thereby, further hindering the growth of this sector. 5.1 Segments and Procedures in Cosmetic Dentistryxvi Based on the products, the cosmetic dentistry industry can be segmented into dental systems and equipment, dental veneers, dental implants, dental crowns, dental bridges, orthodontic braces, bonding agents, and inlays and onlays. Dental systems and equipment market accounts for the largest share of the cosmetic dentistry market due to the wide applications of dental equipment and systems in different dental procedures. The rising use of CAD/CAM systems for milling different prosthetics such as crowns, veneers, bridges, and inlays and onlays for cosmetic dental procedure have also contributed to the high share of this market.

Exhibit 8: Segments in Cosmetic dentistry xvii

Dental Dental Systems & Dental Orthodontic Radiology Dental Bridges Equipment Implants Braces Equipment

Instrument Traditional Fixed delivery system, Bridges Braces Extra-oral Titanium Dental chairs, Radiology hand pieces, Implants scaling units Cantilever Removable Bridges Braces CAD/CAM Intra-oral Zircomium System Radiology Implants Maryland Bridges CBCT Dental Lasers Scanners

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Cosmetic treatments include veneers, implants, crowns, bridges, tooth whitening and tooth-colored fillings. The procedures used in cosmetic dentistry are: 5.1.1 Inlays and Onlays Also known as indirect fillings, they are used to treat a tooth with mild to moderate decay. In such cases, where there is no damage to the tooth cusp, the inlay is placed directly onto the tooth surface. Cases where the tooth structure is not sufficient to support a filling and the cusp, or a greater portion of the tooth is damaged, an onlay is used instead to cover the tooth's entire surface. Inlays and onlays are made in a dental laboratory from composite resin material and attached to the tooth using adhesive dental cement. They provide support to strengthen the tooth, restore its shape and avoid any further decay or deterioration. 5.1.2 Composite Bonding Composite bonding, one of the least-expensive cosmetic dentistry procedures, is used to repair decayed, damaged or discolored teeth using materials that resemble the color of tooth enamel. The is drilled out and the composite is applied onto the tooth's surface, which is then sculpted into the right shape before curing it with a high-intensity light. The process effectively covers the damage to the tooth and gives the appearance of a healthy tooth in its place. 5.1.3 Dental Veneers Dental veneers are custom manufactured from medical-grade ceramic and are applied to the front of each tooth using a dental adhesive. They are used to resolve cosmetic problems such as crooked teeth, cracked or damaged enamel and noticeable gaps between teeth. 5.1.4 Teeth Whitening Teeth whitening, or teeth bleaching is performed after plaque, tartar and other debris are cleaned from the surface of each tooth, restoring the natural appearance. 5.1.5 Implants Dental implants are used to replace a tooth after tooth loss, using a small titanium screw that is inserted into the jaw at the site of the missing tooth to support the crown. Once the bone and supporting tissue fuse to the implant, they are permanently secured into place and become almost indistinguishable from the surrounding natural teeth. 5.2 Demand drivers xviii According to the American Academy of Cosmetic Dentistry (AACD), most cosmetic patients fall in the age category of 40-49 (26.88%), followed by the 50-plus age group (25.09%). Females represent 71% of these patients and lead the demand. Whitening/bleaching is the most popular cosmetic procedure in the US, wherein full-bleaching costs approximately USD 700 on an average. Cost of veneers range between USD 700-1,200, while inlays/onlays range between USD 600-900. As per an AACD survey in 2015, the following are the parameters to understand the direction of the cosmetic dentistry industry: 5.2.1 Factors driving cosmetic dentistry demand After studying the importance of various factors driving demand, the finding was that the demand for cosmetic dentistry is primarily driven by referrals from others who have had a positive experience.

Exhibit 9: Factors driving demand xix

93% 78% 76% 75% 63% 56%

24% 23%

Referrals from Improved Growing baby Increase in Better marketing Media coverage Retail Lower prices of friends and cosmetic boomer information of dental of cosmetic distribution of some cosmetic family who had materials generation about cosmetic practices dentistry whitening services good results facilitating interested in a dentistry online treatments better aesthetic more youthful results appearance

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5.2.2 Reasons patients cite for wanting cosmetic dentistry treatments The increased focus on appearance is driving the demand for the cosmetic dentistry procedures.

Exhibit 10: Reasons for demand xx

86%

51% 46% 48% 45% 23%

To improve physical Restorative/ health Upcoming events To improve career To fix a previous To look and feel attractiveness and reasons (wedding, etc.) success cosmetic treatment younger self-esteem

5.2.3 Issues of primary concern for patients At the top of the list is appearance, indicated by 99% of survey respondents. Indicated by fewer, but still a substantial majority, are cost (85%) and longevity of treatment results (77%).

Exhibit 11: Patient’s primary concerns xxi

99% 88% 77% 49% 49% 39%

Appearance Cost Longevity of Time needed to Pain Amount of original treatment results complete treatment tooth removed

5.2.4 Preference for Material Consumer preference for restoration material is Lithium Disilicate (i.e., IPS e.max) or Zirconia trailing with survey respondents naming these materials respectively in 84% and 58% of cases.

Exhibit 12: Restoration material preference xxii

84%

58%

22% 18%

Zirconia Lithium Disilicate Hybrid Ceramic Resin Metal Ceramic

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5.2.5 Treatment frequency of a procedure/ treatment With respondents checking more than one option, the following chart shows the frequency of a specific procedure/ treatment. Exhibit 13: Choice of treatment xxiii 82% 74% 54% 58% 46% 49% 31% 23% 26% 25% 14% 13% 16% 4%

5.2.6 Most popular cosmetic procedure at a 5.2.7 Usage of a chairside CAD/CAM system practice Exhibit 14: Preference for procedure xxiv Exhibit 15: Prevalence of CAD/ CAMxxv

Others , Dentures, Usage of CAD/ 9% 2% Veneers, 22% CAM system Other, 40% in practice, 28%

Bonding, 30% Whitening, 32% Purchase under consideration, Implants, 5% 32%

5.3 Market Trendsxxvi Technological upgrades (CAD/CAM and 3D imaging) have improved the growth prospects of the overall industry.

5.3.1 3D Dentistry 3D tooth printing requires usage of scanners, 3D-modelling software and a block of a suitable material. 3D printers fabricate items layer over layer, enabling replacements with natural looking teeth. Currently, the possibility of fabricating 3D teeth with antimicrobial properties is being explored.

5.3.2 Made-to-Order Customized and personalized treatments such as smile makeover and full-mouth reconstruction are being designed and developed as per the needs and goals of individuals.

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5.3.3 Preference for less-invasive methods Invisalign helps patients to undergo treatment in a discreet fashion, e.g., straightening the teeth without a . Invisalign’s clear plastic braces (known as aligners) are virtually undetectable in the mouth versus wearing traditional metal wires and brackets on teeth.

5.3.4 Porcelain Veneers A dental technician custom builds veneers to place them on top of the existing teeth to create a natural and lasting smile. Ultra-thin veneers offer a quick and minimally invasive cosmetic dental solution as these do not require any tooth preparation and the trimming of outer surface of the teeth is prevented.

Porcelain veneers, thin laminates of ceramic that mimic tooth enamel, are placed over existing teeth to hide aesthetic flaws and the process requires only two to three dental appointments. Porcelain veneers are also a viable substitute to teeth whitening or orthodontic braces for patients unable to commit to the timeframe of orthodontic alignment.

5.3.5 Professional cleaning and whitening The whitening process involves usage of protective devices and materials that shield the patient’s eyes, lips and gums from the bleaching agent. The safety, speed and efficiency of professional in-chair teeth whitening, which allows up to 8 shades of improvement in a one-hour session, is recognizable as a value-for-money option among patients.

5.4 Future Outlook Dental industry is witnessing upgrades in technologies, such as CAD/CAM system, 3D printing for diagnosis, and robotic technologies for prosthesis. These are the future drivers of the global dental market. 5.4.1 Growth prospects Dental crowns and dental bridges enjoyed the largest share of the cosmetic dentistry market in 2016 and are expected to be the fastest-growing segment in the forecast period 2016-21, driven by the development of newer technologies such as customized dental implants. The rising demand for and adoption of laser dentistry is expected to boost the market growth.

Exhibit 16: 2016 Market share xxvii Exhibit 17: Expected CAGR 2016-2021 xxviii

6.5%

5.7% 4.9% Dental & Bridges 29.4% Dental Implants

59.2% Others 10.5% 0.9% Dental & Bridges Dental Implants Orthodontics

5.4.2 Digital Dentistry One of the most significant growth trends in the dental industry is the growing acceptance of digital dentistry including CAD/CAM and 3D imaging. More dental technology companies investing in new products with minimally invasive techniques and tools, such as dental lasers, will help to increase the market size of the industry.

The industry is still at an early stage in the adoption curve for these technologies, but the penetration rates will continue to climb, particularly as a growing number of new dentists choose to join larger or corporate practices as opposed to starting a new practice. However, capital investment will be a constraint (in the early years). Therefore, those starting new practices may be unable to adopt more expensive digital dentistry workflows.

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Exhibit 18: Digital Dentistry – Penetration Rate 2014 xxix

5% 50% 86% 89% 97%

Computer/ Practice Digital Xray Digital Impression CAD/CAM Cone Beam/ 3D Management

Existing Opportunity

5.5 Markets in Europe, Asia and the US 5.5.1 Market in Europexxx Europe has led the cosmetic dental market with 40% of market share, among all three major regional markets in the past several years. However, this region currently continues to face macroeconomic headwinds, especially after Brexit, while the Eastern European region faces geopolitical concerns.

5.5.2 Market in Asiaxxxi It represents 26% of the cosmetic dentistry market and is expected to grow at a higher CAGR in the next five years. China and the Middle East are expected to be the fastest-growing markets, although the market here is still in the initial stages of development. However, broader macro issues are an impediment to faster development.

5.5.3 Market in U.S. xxxii The US market represents 34% of the market size. Dentsply Sirona, the major market player in the cosmetic industry also recently reported sluggish growth in the region.

5.6 Regulatory Framework Dental products are legally defined as medical devices and their manufacturers are subject to the regulations of governmental entities. Such regulations govern the introduction of new medical devices, the abiding to certain standards for manufacturing and labelling of medical devices, the maintenance of records and the reporting of potential product problems. 5.6.1 Regulatory body in Europe xxxiii xxxiv CE marking, a legal requirement to place a medical device in the European Union (EU) market, is the manufacturer’s claim that the product meets the applicable requirements of the European Medical Device Directives. CE Marked products are permitted free movement within the European Free Trade Association (EFTA) and EU single market. A medical device can be classified as Class I (including Is & Im), Class IIa, IIb and III, wherein Class III covers the highest-risk products. A European Authorized Representative is appointed to help in

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identifying all EU Directives applicable to the product, which then helps in classifying the device and selecting the most appropriate conformity assessment module. With higher classification, a greater level of assessment is required and involves the intervention of a third party called Notified Body. Recently, the EU Parliament adopted new Medical Device and IVD regulations, which include stricter premarket review of high-risk devices, improved traceability, strengthened designation criteria for notified bodies and a risk-based classification system for IVDs. The new European Medical Devices Regulation (MDR) replaces the Medical Devices Directive (93/42/EEC) and Active Implantable Medical Devices Directive (90/385/EEC) and has a transition period of three years for manufacturers to update their technical documentation and processes. 5.6.2 Regulatory body in China xxxv xxxvi The China Food and Drug Administration (CFDA), part of the State Council of the People's Republic of China, is the Chinese agency for regulating food, drugs and medical devices. Its responsibilities include a) establishing medical device standards and classification systems and b) drafting laws and regulations for food safety, drugs, medical devices and cosmetics. In 2013, the SFDA, China’s medical device market regulator, renamed itself as CFDA. The State classifies medical devices as Class I, Class II, Class III based on the requirements for safety and effectiveness. The State encourages the research and development of new medical devices, wherein the clinical trials of Class II and Class III medical devices can be conducted only after the relevant authority’s approval. The new medical device, on completion of the clinical trials and passing drug regulatory authority's evaluation and review, receives a new product certificate. The State, then, implements a product registration system for the manufacturing of medical devices, which are inspected, approved and granted a registration certificate. Clinical evaluation must be conducted for Class II and Class III medical devices before these are put into production. 5.6.3 Regulatory body in the US xxxvii The Federal Food, Drug and Cosmetic Act (“FDC Act”) regulates medical devices in the US by classifying them into one of three classes. The Class III devices have the highest requirement for safety and effectiveness, and are limited to life sustaining, life supporting or implantable devices. Most medical devices, before being marketed in the US, are required by the FDA to secure either clearance of a premarket notification under Section 510(k) of the FDC Act or approval of a PMA. The 510(k) Clearance is required to be filed and cleared by the FDA prior to introducing a device into commercial distribution. Class I and Class II devices enter the market via the 510(k) Clearance procedure, while new Class III devices enter the market via the rigorous PMA procedure. 5.7 Competitive Landscape xxxviii xxxix Cosmetic dentistry market has both global and regional vendors, including top vendors such as Danaher Corporation, 3M, Zimmer Biomet, Align Technology and Dentsply Sirona. Other prominent vendors are Bicon, BioHorizons, Cortex Dental Implants, Denxy and Green DenTech. In past few years, the dental industry has seen some consolidation. For instance, Danaher's acquisition of Nobel, Straumann’s acquisition of Neodent, and the Dentsply/Sirona merger. However, the industry continues to remain fragmented.

Exhibit 19: Digital Dentistry – Penetration Rate xl

Danaher Revenue ~ USD 2.7 bn, Headquartered in the US 3M Revenue ~ USD 1.2 bn, Headquartered in the US Ivoclar Revenue ~ USD 0.8 bn, Headquarterd in Schaan, Liechtenstein

Zimmer Biomet Revenue ~ USD 5.9 bn, Headquarterd in the US

Align Revenue ~ USD 0.9 bn, Headquarterd in the US Planmeca Revenue ~ USD 0.9 bn, Headquarterd in Finland

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6. Valuation The Fair Market Value for all Remedent shares stands between USD 3.8 mn and USD 4.8 mn. The Fair Market Value for one of Remedent’s publicly traded regular shares stands between USD 0.19 and USD 0.24. The valuation approach followed is the DCF method. 6.1 Discounted Cash Flow Method

Valuation

WACC Risk-free rate 0.87%xli

Beta 0.95xlii Market Return 9.00%xliii Cost of Equity 8.59% Terminal Growth Rate 2.50% WACC (Discount Rate) 8.59%

All figures are in USD’000 Exhibit 22: Year Ending - March 2019E 2020E 2021E 2022E 2023E 2024E 2025E FCFF (High)* Net cash from operating activities 263 306 143 254 352 337 413 Capital Expenditure (20) (25) (30) (35) (40) (45) (50) Free Cash Flow to Firm 243 281 113 219 312 292 363 Discount factor 0.98 0.91 0.83 0.77 0.71 0.65 0.60 Present Value of FCFF 239 255 94 168 221 191 218 FCFF (Low)* Net cash from operating activities 224 278 107 194 296 273 336 Capital Expenditure (20) (25) (30) (35) (40) (45) (50) Free Cash Flow to Firm 204 253 77 159 256 228 286 Discount factor 0.98 0.91 0.83 0.77 0.71 0.65 0.60 Present Value of FCFF 201 230 64 122 182 149 172

Arrowhead Fair Value Bracket Low High Terminal Value (TV) 4,209 5,347 Present Value of TV 1,973 2,507 Present value of FCF 1,791 2,238 Present Value of FCF + TV 3,765 4,745 Less: Debt (net of cash) (55) (55) Equity Value Bracket 3,820 4,800 Shares on issue (‘000) 19,996 19,996 xliv Fair Share Value Bracket (USD) 0.19 0.24 Current Market price (USD) 0.20 0.20 xlv Current Market Cap. (USD’000) 3,999 3,999 Target Market Cap. Bracket (USD‘000) 3,780 4,800

Approach for DCF Valuation Time Horizon: The Arrowhead fair valuation for Remedent is based on the DCF method. The time chosen for the valuation is 2019E-2028E. Terminal Value: Terminal value is estimated using terminal growth rate of 2.5%. Prudential nature of valuation: It should be noted that this Arrowhead Fair Value Bracket estimate is a relatively prudential estimate, as it discounts the eventuality of any new products being launched in the market or any significant change in the strategy.

REMEDENT– Arrowhead BID 24 OTC: REMI Due Diligence and Valuation Report See important disclosures on page 29 of this report

6.2 Relative Valuation The Fair Market Value of one of Remedent’s publicly traded regular shares stand between USD 0.23 and USD 0.28 on January 21, 2019, according to the relative valuation method.

Exhibit 23: Relative Valuation Method

EV/EBITDA (Trailing Market Cap (in USD Current Enterprise EBITDA (Trailing 12 Company Name 12 Months) (in USD mn) Value (in USD mn) Months) (in USD mn) mn) Elos Medtech AB 64 92 10 9.1x Q & M Dental Group 287 334 24 13.9x Align Technology Inc 15,819 15,206 505 30.1x Dentsply Sirona Inc 7,896 9,405 (1,411) NA Zimmer Biomet Holdings Inc 20,759 29,438 1,837 16.0x Danaher Corporation 68,931 78,784 4,682 16.8x Weighted Average 17.3x

All figures are in USD’000 except market price and intrinsic value Relative Valuation (All figures are in USD’000 except per share data)

High Low Remedent EBITDA FY 2028 (USD’000) 683.1 549.3 PEER EV/ EBITDA 17.3 17.3 Enterprise Value (EV) FY 2028 (USD’000) 11,851.1 9,529.1 PV of FY 2028 EV 5,556 4,467

Adjustment: Less: Debt (Net cash) (55.1) (55.1) Implied Equity Value 5,611.1 4,522.4 Shares o/s ('000s) 19,996.0 19,996.0

Intrinsic Value per share 0.28 0.23 Current market Price 0.20 0.20 Upside / (Downside) 40.3% 13.1%

6.3 Blended Valuation The Fair Market Value of one of Remedent’s publicly traded regular shares stands between USD 0.26 and USD 0.21 on December 21, 2018, according to blended valuation method. Exhibit 23: Blended Valuation High Low DCF 0.24 0.19 Relative Valuation 0.28 0.23 Blended Value 0.26 0.21

REMEDENT – Arrowhead BID 25 OTC: REMI Due Diligence and Valuation Report See important disclosures on page 29 of this report

Important information on Arrowhead methodology The principles of the valuation methodology employed by Arrowhead BID are variable to a certain extent depending on the subsectors in which the research is conducted, but all Arrowhead valuation research possesses an underlying set of common principles and a generally common quantitative process.

With Arrowhead Commercial and Technical Due Diligence, Arrowhead extensively researches the fundamentals, assets and liabilities of a company, and builds solid estimates for revenue and expenditure over a coherently determined forecast period.

Elements of past performance, such as price/earnings ratios, indicated as applicable, are present mainly for reference purposes. Still, elements of real-world past performance enter the valuation through their impact on the commercial and technical due diligence.

Elements of comparison, such as multiple analyses may be to some limited extent integrated in the valuation on a project-by-project or asset-by-asset basis. In the case of this Remedent report, there are no multiple analyses integrated in the valuation.

Arrowhead BID Fair Market Value Bracket The Arrowhead Fair Market Value is given as a bracket. This is based on quantitative key variable analysis, such as key price analysis for revenue and cost drivers or analysis and discounts on revenue estimates for projects, especially relevant to those projects estimated to provide revenue near the end of the chosen forecast period. Low and high estimates for key variables are produced as a tool for valuation. The high-bracket DCF valuation is derived from the high-bracket key variables while the low bracket DCF valuation is based on the low bracket key variables.

In principle, an investor who is comfortable with the high-brackets of our key variable analysis will align with the high- bracket in the Arrowhead Fair Value Bracket, and likewise in terms of low estimates. The investor will also consider the company intangibles – as presented in the first pages of this document in the analysis on strengths and weaknesses and on other essential company information. These intangibles serve as supplementary decision factors for adding or subtracting a premium in the investor’s own analysis.

The bracket should be understood as a tool provided by Arrowhead BID for the reader of this report and the reader should not solely rely on this information to make his decision on any particular security. The reader must also understand that on one hand, global capital markets contain inefficiencies, especially in terms of information, and that on the other hand, corporations and their commercial and technical positions evolve rapidly: this present edition of the Arrowhead valuation is for a short to medium-term alignment analysis (one to twelve months). The reader should refer to important disclosures on page 28 of this report.

REMEDENT – Arrowhead BID 26 OTC: REMI Due Diligence and Valuation Report See important disclosures on page 29 of this report

7. Appendix 7.1 Remedent’s Financial Summary

Exhibit 24: Financial

Summary (USD High Bracket Estimates ‘000) Year Ending Mar 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E Revenue (USD’000) 1,755 1,948 2,162 2,400 2,664 2,957 3,268 3,611 3,990 4,409 Operating Profit (129) (51) 2 51 113 185 269 370 488 628 (USD’000) Net Income (USD’000) 230 319 394 471 561 664 781 915 1,069 1,246 EPS 0.01 0.02 0.02 0.02 0.03 0.03 0.04 0.05 0.05 0.06 Growth rates (%) Revenue (35%) 11% 11% 11% 11% 11% 11% 11% 11% 6% Operating Profit NM NM (104%) 2171% 120% 64% 46% 37% 32% 29% Margins (%) Gross Margins (%) 67% 68% 68% 68% 69% 69% 70% 70% 71% 71% Operating Profit Margin (7%) (3%) 0% 2% 4% 6% 8% 10% 12% 14% Net Profit Margin 13% 16% 18% 20% 21% 22% 24% 25% 27% 28% Ratios ROA 2% 3% 3% 3% 4% 4% 4% 4% 4% 5% ROE 3% 4% 5% 5% 6% 6% 6% 6% 7% 7% Debt/Equity 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Interest Coverage NA NA NA NA NA NA NA NA NA NA

Exhibit 25: Financial Low Bracket Estimates Summary (USD ‘000) Year Ending Mar 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E Revenue (USD’000) 1,620 1,782 1,960 2,156 2,372 2,609 2,857 3,128 3,425 3,751 Operating Profit (142) (70) (23) 24 76 136 206 287 383 494 (USD’000) Net Income (USD’000) 215 300 370 444 527 620 725 845 982 1,138 EPS 0.01 0.01 0.02 0.02 0.03 0.03 0.04 0.04 0.05 0.06 Growth rates (%) Revenue (40%) 10% 10% 10% 10% 10% 10% 10% 10% 6% Operating Profit NM NM (67%) (206%) 214% 79% 51% 40% 33% 29% Margins (%) Gross Margins (%) 67% 67% 68% 68% 69% 69% 70% 70% 71% 71% Operating Profit Margin (9%) (4%) (1%) 1% 3% 5% 7% 9% 11% 13% Net Profit Margin 13% 17% 19% 21% 22% 24% 25% 27% 29% 30% Ratios ROA 2% 3% 3% 3% 3% 4% 4% 4% 4% 5% ROE 3% 4% 5% 5% 5% 6% 6% 6% 6% 6% Debt/Equity 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Interest Coverage NA NA NA NA NA NA NA NA NA NA

REMEDENT – Arrowhead BID 27 OTC: REMI Due Diligence and Valuation Report See important disclosures on page 29 of this report

7.2 Remedent’s Balance Sheet Forecast – High Estimates

Exhibit 27: Consolidated Balance Sheet USD ‘000 Year Ending March 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 31 Total current assets 1,648 1,773 1,788 1,822 1,922 2,054 2,223 2,455 2,747 3,117 Total Non-current 4,171 4,621 5,142 5,730 6,390 7,128 7,951 8,868 9,890 11,030 assets TOTAL ASSETS 5,819 6,394 6,930 7,552 8,312 9,182 10,174 11,323 12,637 14,147 Total current 2,278 2,534 2,675 2,827 3,027 3,232 3,443 3,678 3,922 4,186 Liabilities Total Non-Current ------Liabilities TOTAL 2,278 2,534 2,675 2,827 3,027 3,232 3,443 3,678 3,922 4,186 LIABILITIES Total Shareholder's 3,541 3,860 4,254 4,725 5,286 5,950 6,731 7,646 8,715 9,961 Equity TOTAL LIABILITIES & 5,819 6,394 6,930 7,552 8,312 9,182 10,174 11,323 12,637 14,147 EQUITY

Remedent’s Balance Sheet Forecast – Low Estimates

Exhibit 28: Consolidated Balance Sheet USD ‘000 Year Ending March 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 31 Total current assets 1,514 1,593 1,555 1,512 1,540 1,584 1,650 1,760 1,907 2,104 Total Non-current 4,171 4,621 5,142 5,730 6,390 7,128 7,951 8,868 9,890 11,030 assets TOTAL ASSETS 5,685 6,214 6,696 7,242 7,930 8,712 9,601 10,628 11,797 13,134 Total current 2,158 2,387 2,500 2,601 2,763 2,925 3,088 3,270 3,457 3,656 Liabilities Total Non-Current ------Liabilities TOTAL 2,158 2,387 2,500 2,601 2,763 2,925 3,088 3,270 3,457 3,656 LIABILITIES Total Shareholder's 3,527 3,827 4,196 4,640 5,167 5,787 6,512 7,358 8,340 9,477 Equity TOTAL LIABILITIES & 5,685 6,214 6,696 7,242 7,930 8,712 9,601 10,628 11,797 13,134 EQUITY

REMEDENT – Arrowhead BID 28 OTC: REMI Due Diligence and Valuation Report See important disclosures on page 29 of this report

8. Analyst Certifications

Analyst certifications Investors must make their own investment decisions I, Parvati Rai, certify that all the views expressed in this based upon their specific investment objectives and research report accurately reflect my personal views financial situation utilizing their own financial advisors about the subject security and the subject company, as they deem necessary. based on the collection and analysis of public information and public company disclosures. Investors are advised to gather and consult multiple sources of information while preparing their investment decisions. Recipients of this report are strongly advised I, Sumit Wadhwa, certify that all of the views expressed to read the Information on Arrowhead Methodology in this research report accurately reflect my personal section of this report to understand if and how the views about the subject security and the subject Arrowhead Due Diligence and Arrowhead Fair Value company, based on the collection and analysis of public Bracket integrate alongside the rest of their stream of information and public company disclosures. information and within their decision-making process.

Important disclosures Past performance of securities described directly or indirectly in this report should not be taken as an Arrowhead Business and Investment Decisions, LLC indication or guarantee of future results. The price, received fees in 2017 and 2018 and will receive fees in value of, and income from any of the financial securities 2018 and 2019 from Remedent for researching and described in this report may rise as well as fall and may drafting this report and for a series of other services to be affected by simple and complex changes in Remedent including distribution of this report and economic, financial and political factors. networking services. Neither Arrowhead BID nor any of its principals or employees own any long or short Should a security described in this report be positions in Remedent. Arrowhead BID's principals denominated in a currency other than the investor’s intend to seek a mandate for investment banking home currency, a change in exchange rates may services from Remedent and intend to receive adversely affect the price of, value of, or income derived compensation for investment banking activities for from the security. Remedent in 2019. This report is published solely for information purposes Aside from certain reports published on a periodic basis, and is not to be considered in any case as an offer to the large majority of reports are published by buy any security, in any state. Arrowhead BID at irregular intervals as appropriate in the analyst’s judgment. Other than disclosures relating to Arrowhead Business and Investment Decisions, LLC, the information herein Any opinions expressed in this report are statements of is based on sources Arrowhead BID believes to be Arrowhead BID’s judgment to this date and are subject reliable but is not guaranteed by Arrowhead BID and to change without notice. does not purport to be a complete statement or summary of the available data. This report was prepared for general circulation and does not provide investment recommendations specific Arrowhead Business and Investment Decisions, LLC is to individual investors. As such, any of the financial or not responsible for any loss, financial or other, directly other money-management instruments linked to the or indirectly linked to any price movement or absence company and company valuation described in this of price movement of the securities described in this report, hereafter referred to as “the securities”, may not report. be suitable for all investors.

REMEDENT – Arrowhead BID 29 OTC: REMI Due Diligence and Valuation Report See important disclosures on page 29 of this report

9. Notes and References i Source: Bloomberg, January 21, 2019 ii 52 weeks to January 21, 2019. Source: Bloomberg January 21, 2019 iii 3 months to January 21, 2019. Source: Bloomberg January 21, 2019 iv Arrowhead Business and Investment Decisions Fair Value Bracket – AFVBTM. See information on valuation on pages 24-28 of this report and important disclosures on page 29 of this report. v Source: Company Website and Company Documents vi Source: Company Website, Q2 2018-19 Results vii Source: Company Website, Q2 2018-19 Results viii Source: Company Website, Q2 2018-19 Results ix Source: Bloomberg x Source: Bloomberg xi Source: Company website – Press Release section, Factiva xii Source: Company Documents and website xiii Source: American Academy of Cosmetic Dentistry (http://www.aacd.com) xiv Source: Grand View Research, Inc. (http://www.prnewswire.com/news-releases/cosmetic-dentistry-market-to-reach-2795-billion-by-2024-grand-view-research-inc-588104822.html) xv Source: Grand View Research, Inc. (http://www.prnewswire.com/news-releases/cosmetic-dentistry-market-to-reach-2795-billion-by-2024-grand-view-research-inc-588104822.html) xvi Source: American Academy of Cosmetic Dentistry (http://www.aacd.com) xvii Source: Markets and Markets (http://www.marketsandmarkets.com/PressReleases/cosmetic-dentistry.asp) xviii Source: State of the Cosmetic Dentistry Survey 2015 (http://www.aacd.com) xix Source: State of the Cosmetic Dentistry Survey 2015 (http://www.aacd.com) xx Source: State of the Cosmetic Dentistry Survey 2015 (http://www.aacd.com) xxi Source: State of the Cosmetic Dentistry Survey 2015 (http://www.aacd.com) xxii Source: State of the Cosmetic Dentistry Survey 2015 (http://www.aacd.com) xxiii Source: State of the Cosmetic Dentistry Survey 2015 (http://www.aacd.com) xxiv Source: State of the Cosmetic Dentistry Survey 2015 (http://www.aacd.com) xxv Source: State of the Cosmetic Dentistry Survey 2015 (http://www.aacd.com) xxvi Source: Arrowhead BID Analysis xxvii Source: Technavio (http://www.businesswire.com/news/home/20170511006200/en/) xxviii Source: Technavio (http://www.businesswire.com/news/home/20170511006200/en/) xxix Source: Patterson Dental (http://files.shareholder.com/downloads/AMDA-1HGAMJ/0x0x784778/3150d2a5-a87d-4d14-ba67- 422f34273959/2014%20Investor%20Day%20Dental%20Presentation%20-%20Final.pdf) xxx Source: Company Website and Company Documents xxxi Source: Company Website and Company Documents xxxii Source: Company Website and Company Documents xxxiii Source: http://www.ce-marking.com/medical-devices.html#whichclassification xxxiv Source: http://www.raps.org/Regulatory-Focus/News/2017/04/05/27279/EU-Parliament-Adopts-New-Medical-Device-IVD-Regulations/

REMEDENT – Arrowhead BID 30 OTC: REMI Due Diligence and Valuation Report See important disclosures on page 29 of this report

xxxv Source: http://www.sfda.com/medical-device.html xxxvi Source: https://www.emergogroup.com/resources/china/china-food-drug-administration xxxvii Source: Company Annual Report 2016 xxxviii Source: http://healthcare.globaldata.com/media-center/press-releases/pharmaceuticals/frances-pharmaceutical-market-value-will-crawl-to-482-billion-by-2020-as-generics-limit- growth-says-globaldata xxxix Source: http://www.pmlive.com/pharma_intelligence/the_impact_of_hollandes_healthcare_reforms_in_france_476586 xl Source: BCG analysis: R&D Productivity 2014: A Breakthrough Year for Biopharma (https://www.bcgperspectives.com/content/articles/biopharmaceuticals_innovation_r_and_d_productivity_2014_breakthrough_year/) xli Source: Bloomberg xlii Source: Bloomberg xliii Source: Bloomberg xliv Shares as on January 21, 2019 xlv Source: Bloomberg, January 21, 2019

REMEDENT – Arrowhead BID 31 OTC: REMI Due Diligence and Valuation Report See important disclosures on page 29 of this report