EX-10 7 ex1021.txt EXHIBIT 10.21 PURCHASE OF ASSETS AGREEMENT as of December 11, 2003 Between DENTSPLY International Inc. Ceramco Inc. Dentsply Research & Development Corp. PDEX Acquisition Corp. DENTSPLY France S.A.S. DENTSPLY DeTrey GmbH and DENTSPLY Italia S.r.l. as Sellers and DAS Equipment Company as Buyer INDEX Page Recitals ............................................1 Article 1 Definitions...............................1 1.1 Affiliate...............................2 1.2 Ancillary Agreements....................2 1.3 Assets..................................2 1.4 Base Financial Statements...............2 1.5 Business................................2 1.6 Closing.................................3 1.7 Closing Date............................3 1.8 Confidential Information................3 1.9 Contracts...............................3 1.10 Damages.................................3 1.11 Encumbrance.............................4 1.12 EU Business.............................4 1.13 Excluded Obligations....................4 1.14 GAAP....................................4 1.15 Gendex Management Employees.............4 1.16 Gendex Operating Units..................4 1.17 Governmental Authority..................4 1.18 Hart-Scott-Rodino.......................4 1.19 Income from Operations..................4 1.20 Initial Payment.........................5 1.21 Intercompany Locations..................5 1.22 Inventories.............................5 1.23 Laws....................................5 1.24 Liability...............................5 1.25 Material Adverse Effect.................5 1.26 Net Sales...............................5 1.27 Person..................................5 1.28 Product Liability Claim.................5 1.29 Products................................5 1.30 Purchase Price..........................6 1.31 Schedules...............................6 1.32 Third Party Receivables.................6 1.33 Third Party Payables....................6 1.34 Transactions Contemplated Hereby........6 1.35 Transferred Employee....................6 (i) 1.36 US and USA..............................6 1.37 US Business.............................6 1.38 US Facility.............................6 1.39 VAT.....................................6 Article 2 Purchase and Sale of Assets...............6 2.1 Transfer................................6 2.2 Payment of Purchase Price...............7 2.3 Adjustments to Purchase Price...........7 2.4 Assumption of Obligations; Retention of Excluded Obligations..... 8 2.5 Proration...............................9 2.6 Instrument of Transfer and Assumption; Deliverables........................... 9 2.7 Consents...............................11 2.8 Further Assurances.....................12 2.9 Sales and Transfer Taxes; Fees.........13 2.10 Relocation of Assets...................13 2.11 Transferred Employees..................14 Article 3 Conditions Precedent.................. 14 3.1 Conditions to Buyer Closing............14 3.2 Conditions to Sellers Closing..........15 Article 4 Representations and Warranties of Seller........................... 15 4.1 Sellers Organization and Good Standing.15 4.2 Authority; Execution and Delivery......16 4.3 Consents; No Conflicts.................16 4.4 Legal Proceedings......................16 4.5 Financial Information..................17 4.6 Permits and Registrations..............17 4.7 Absence of Certain Changes or Events...17 4.8 Contracts..............................18 4.9 Assets.................................19 4.10 Inventory..............................19 4.11 Intellectual Property..................20 4.12 Employee Matters.......................22 4.13 Litigation.............................25 4.14 Compliance with Laws...................25 4.15 Product Warranties.....................25 4.16 Receivables............................26 4.17 Brokers................................26 4.18 Complete Copies of Contracts...........26 (ii) 4.19 Environmental Matters..................26 4.20 Real Property..........................27 4.21 Significant Customers and Suppliers....28 4.22 Taxes..................................28 4.23 Bank Accounts; Powers of Attorney......29 4.24 Backlog................................29 4.25 Unlawful Payments......................29 4.26 Absence of Claims; Business Relationships with Affiliates....... 29 4.27 Books and Records......................30 4.28 Trade Accounts Payable.................30 Article 5 ..Representations and Warranties of Buyer30 5.1 Buyer's Organization, Power, Execution.30 5.2 Non-Violation..........................30 5.3 Legal Proceedings......................31 5.4 Brokers................................31 5.5 Cash Resources.........................31 Article 6 Covenants of Seller................. 31 6.1 Conduct of the Business................31 6.2 Certain Changes........................31 6.3 Access to Information..................32 6.4 Exclusivity............................32 6.5 VAT Refund.............................32 Article 7 Other Agreements.................... 33 7.1 Books and Records......................33 7.2 Bulk Sales Laws........................33 7.3 Allocation of Purchase Price and Tax Matters................... 33 7.4 No Implied Representations.............34 7.5 Currency Exchange......................34 7.6 Intercompany Effects...................34 7.7 Cause Conditions to be Satisfied.......35 7.8 Notification of Certain Matters........35 7.9 Transitional Services Agreement........35 Article 8 Termination......................... 35 8.1 General Termination....................35 8.2 Termination by Buyer...................36 8.3 Termination by Seller..................36 8.4 Effect of Termination..................36 (iii) Article 9 Indemnities......................... 36 9.1 Indemnity Claims.......................36 9.2 Indemnification by Sellers.............38 9.3 Indemnification by Buyer...............39 Article 10 Survival; Claims.......................39 10.1 Survival...............................39 10.2 Limitation of Indemnification Obligations............................40 10.3 Determination of Damages...............41 10.4 Exclusivity of Remedies................42 Article 11 Confidentiality........................42 11.1 Confidentiality........................42 11.2 Reasonable Restraint...................42 11.3 Severability; Reformation..............43 11.4 Materiality............................43 Article 12 Miscellaneous............................43 12.1 Cooperation............................43 12.2 Payment of Expenses....................43 12.3 Modifications; Waivers.................43 12.4 Successor/Assignability................44 12.5 Dispute Resolution.....................44 12.6 Specific Performance; Remedies.........44 12.7 Governing Law..........................44 12.8 Arbitration............................45 12.9 Publicity..............................45 12.10 Notices................................46 12.11 Captions; Mutual Product...............46 12.12 Further Representations................46 12.13 Counterparts...........................47 12.14 No Third Party Beneficiaries...........47 12.15 Right to Set Off.......................47 12.16 Entire Agreement.......................47 12.17 Usage..................................47 12.18 Guarantees.............................48 (iv) SCHEDULES -------------------------------------------------- Description Schedule -------------------------------------------------- -------------------------------------------------- Assets 1.3 A -------------------------------------------------- -------------------------------------------------- Excluded Assets 1.3 B -------------------------------------------------- -------------------------------------------------- Products 1.28 -------------------------------------------------- -------------------------------------------------- Assumed Obligations 2.4 -------------------------------------------------- -------------------------------------------------- Consents 2.6(a)(x) -------------------------------------------------- -------------------------------------------------- Exceptions 4 -------------------------------------------------- -------------------------------------------------- Financial Information 4.5 -------------------------------------------------- -------------------------------------------------- Material Contracts 4.8(b) -------------------------------------------------- -------------------------------------------------- Additional Contracts 4.8(c) -------------------------------------------------- -------------------------------------------------- Fixed Assets 4.9 -------------------------------------------------- -------------------------------------------------- Patents 4.11 A -------------------------------------------------- -------------------------------------------------- Trademarks 4.11 B -------------------------------------------------- -------------------------------------------------- Other Intellectual Property 4.11 C -------------------------------------------------- -------------------------------------------------- Employment Terms 4.12 -------------------------------------------------- -------------------------------------------------- Litigation 4.13 -------------------------------------------------- -------------------------------------------------- Warranty 4.15 -------------------------------------------------- -------------------------------------------------- Environmental Matters 4.19 -------------------------------------------------- -------------------------------------------------- Real Property 4.20 -------------------------------------------------- -------------------------------------------------- Significant Customers and Suppliers 4.21(a) -------------------------------------------------- -------------------------------------------------- Taxes 4.22 -------------------------------------------------- -------------------------------------------------- Bank Accounts, Power of Attorney 4.23 -------------------------------------------------- -------------------------------------------------- Claims; Business Relationships 4.26 with Affiliates -------------------------------------------------- -------------------------------------------------- Disclosures 10.3 -------------------------------------------------- -------------------------------------------------- Description Exhibit -------------------------------------------------- -------------------------------------------------- Sublease 2.6A -------------------------------------------------- -------------------------------------------------- Manufacturing Agreement 2.6B -------------------------------------------------- -------------------------------------------------- Representative Agreement 2.6C -------------------------------------------------- -------------------------------------------------- Transitional Services Agreement 7.9 -------------------------------------------------- (v) PURCHASE OF ASSETS AGREEMENT This Purchase of Assets Agreement ("Agreement"), dated as of December __, 2003, is made and entered into by and between DAS Equipment Company, a corporation organized and existing under the laws of Delaware, USA, with a principal place of business at 2099 Pennsylvania Avenue, N.W., Washington, D.C. 20006-1813 (herein referred to as "Buyer"), AND DENTSPLY International Inc., a corporation organized and existing under the laws of Delaware, USA, with a principal place of business at 570 West College Avenue, York, Pennsylvania 17404 ("Dentsply") Dentsply Research & Development Corp., a Delaware corporation with a principal place of business at 2283 Cosmos Court, Carlsbad, California 92009 ("DRDC"), PDEX Acquisition Corp., a Delaware corporation with a principal place of business at 1209 Orange Street, Wilmington, Delaware 19801 ("PDEX"), Ceramco Inc., a Delaware corporation with a principal place of business at Six Terri Lane, Burlington, NJ 08016 ("Ceramco"), Dentsply DeTrey GmbH, a company organized and existing under the laws of Germany, with a principal place of business at DeTrey Strasse 1, D-78467 Konstanz, Germany ("DeTrey"), Dentsply Italia S.r.l., a company organized and existing under the laws of Italy, with a principal place of business at Via A. Cavaglieri, 26, 1-00173 Rome, Italy ("Italia"), and Dentsply France S.A.S., a company organized and existing under the laws of France, with a principal place of business at 17, rue Michael Faraday, 78180 Montigny le Bretonneux, France ("France") (collectively referred to as the "Sellers"). W I T N E S S E T H: WHEREAS, Sellers are engaged in the business of developing, manufacturing, marketing, producing, selling and distributing dental imaging products and related services throughout the world; WHEREAS, Sellers desire to divest themselves of such business and substantially all of the assets and certain of the liabilities associated therewith; WHEREAS, Buyer desires to acquire such business and assets and is willing to assume such liabilities; and WHEREAS, Buyer and Sellers desire to consummate the transactions contemplated hereby both directly and through their respective Affiliates. NOW, THEREFORE, in consideration of the mutual obligations herein contained, intending to be legally bound, the parties agree as follows: ARTICLE I - DEFINITIONS 1. Definitions. In this Agreement, the following terms shall have the meanings assigned to them below: 1.1 "Affiliate" of a specified Person (natural or juridical) shall mean (A) a Person that directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with the Person specified or (B) any director, officer, partner, member or trustee of such Person. As used herein, "controls," "control" and "controlled" means the possession, direct or indirect, of the power to direct the management and policies of a Person, whether through the ownership of 50% or more of the voting interests of such Person, through agreement or otherwise. 1.2 "Ancillary Agreements" shall mean all agreements, other than this Agreement, entered or to be entered by the Sellers and Buyer in furtherance of or in connection with the transactions described in this Agreement, including, but not limited to, the Bill of Sale, Assignment and Assumption Agreement, Manufacturing Agreement, Representative Agreement, Sublease Agreement and any Transitional Services Agreements. 1.3 "Assets" shall mean (a) all the Patents, Trademarks and Fixed Assets owned or used by any Sellers in connection with the Business as currently conducted by Sellers, (b) all Scheduled Contracts, (c) all Contracts, entered into by any Seller in the ordinary course of business consistent with past practice that are primarily related to the Business and that are not required to be listed on Schedule 4.8(b) or 4.8(c), and (d) all other assets (other than Contracts) and rights and permits owned by, registered in the name of, or used or held for use by, any Sellers primarily in connection with the Business, as conducted prior to the Closing, including, with respect to (a) - (d) above, the assets and rights described on Schedule 1.3A, Assets but excluding the items described on Schedule 1.3B, Excluded Assets. 1.4 "Base Financial Statements" shall mean the pro forma condensed balance sheet of the Gendex Operating Units as of, and the pro forma statement of operations for the Business for the nine (9) month period ended, September 30, 2003, each as set forth on Schedule 4.5. 1.5 "Business" shall mean the business represented by the research and development, manufacturing, marketing, selling and distribution of the Products worldwide by Sellers, including the operations of the Business conducted by the Gendex Operating Units and Intercompany Locations and including all research and product development activities and information related to the Products. Unless otherwise indicated, "Business" refers to the Business as conducted by Sellers as of the date hereof and as of the Closing. 1.6 "Closing" shall mean the meeting of the parties at which the sale, assignment, transfer and delivery of the Assets by Sellers to Buyer, the payment of the Initial Payment by Buyer and the other transactions contemplated hereby are completed. The Closing shall take place at the offices of Dentsply, York, Pennsylvania, USA, on the later of January 2, 2004 (if the Closing occurs on January 2, 2004, it shall be deemed to have occurred at 12:01 a.m. on January 1, 2004, or the third business day in York, Pennsylvania following the expiration of the Hart-Scott-Rodino waiting period; if the conditions precedent to the Closing have not been fulfilled by such time, then the Closing shall take place at the same time of day in the same place on the third business day following the day on which such conditions precedent are fulfilled. For purposes of determining whether an event occurred before or after the Closing (other than the satisfaction of the closing conditions, the delivery of the certificate contemplated by Section 3.1(vi) and the determination of any indemnification rights and obligations in connection with the representations and warranties set forth in Articles IV and V), the Closing shall be deemed to have taken place at the 12:01 a.m. on the day of Closing. 1.7 "Closing Date" shall mean the date on which the Closing occurs. 1.8 "Confidential Information" means any information which is proprietary or not known publicly or by the trade, including, without limitation, information with respect to present or future business, operations, services, products, research, inventions, discoveries, drawings, designs, plans, processes, models, technical information, facilities, methods, trade secrets, copyrights, software, source code, systems, patents, procedures, manuals, specifications, any other intellectual property, confidential reports, price lists, pricing formulas, customer lists, financial information (including the revenues, costs, or profits associated with any products or services), business plans, lease structure, projections, prospects, opportunities or strategies, acquisitions or mergers, advertising or promotions, personnel matters or legal matters (including confidential and proprietary information and trade secrets entrusted by third parties in confidence). 1.9 "Contracts" shall mean all contracts, leases, commitments, licenses, guarantees, arrangements and agreements of every type and description to which any of the Sellers are a party or by which any of them are bound, whether written or oral. 1.10 "Damages" shall mean claims, losses, obligations, Liabilities, damages (including any amounts that a party seeking Damages is required to pay to a third party and punitive damages), deficiencies, costs, expenses (including, without limitation, reasonable fees and expenses of counsel and consultants, traveling expenses of employees and expenses of investigation), actions, suits, proceedings, (including informal and administrative proceedings), investigations, demands, assessments, adjustments, audits, settlement payments, Taxes, penalties, fines, interest (including interest from the date of determination of such damages) and judgments (including, without limitation, any proceedings to establish insurance coverage). 1.11 "Encumbrance" shall mean any lien (statutory or otherwise), security interest, charge or encumbrance of any kind or nature whatsoever. 1.12 "EU Business" shall mean the Gendex operating units located in Cusano Milanino, Italy and Hamburg, Germany. 1.13 "Excluded Obligations" shall mean all Liabilities of the Business, the Gendex Operating Units and Sellers not constituting Assumed Obligations. 1.14 "GAAP" shall mean USA generally accepted accounting principles, consistently applied. 1.15 "Gendex Management Employees" shall mean Gary Berg, Marco Dolci, Gary Radwanski, Keith Trecker, John Miller, Roberto Molteni and Gary Sieckman. 1.16 "Gendex Operating Units" shall mean the three Gendex operating locations of the Business based in Des Plaines, IL, Cusano Milanino, Italy and Hamburg, Germany. 1.17 "Governmental Authority" shall mean any federal, state, local or foreign, governmental or quasi-governmental entity or municipality or subdivision thereof or any authority, department, commission, board, bureau, agency, court, tribunal instrumentality, or applicable self-regulatory organization (each, a "Governmental Authority"). 1.18 "Hart-Scott-Rodino" shall mean the USA Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. 1.19 "Income from Operations" shall mean Net Sales of the Business, less cost of goods sold and distribution, selling, general and administrative and research and development expenses of the Gendex Operating Units, and cost of goods sold at standard and direct expenses and/or allocation of selling and distribution expenses as described in Schedule 4.5 for Intercompany Locations. Income from Operations does not include interest, taxes, restructuring costs (including plant relocation costs), European information technology costs, elimination of manufacturing margin associated with product remaining in inventory in Intercompany Locations, and/or currency exchange gains/losses. 2003 Income from Operations includes a pro forma adjustment to reflect the new cost structure for the DenOptix Product under the new Alara agreement as if all product sold in 2003 was purchased under the new agreement. 1.20 "Initial Payment" shall mean US $102.5 million. 1.21 "Intercompany Locations" shall mean Affiliate locations that sell Products and are not a part of the Gendex Operating Units. 1.22 "Inventories" shall be as defined on Schedule 1.3A, Assets. 1.23 "Laws" shall mean all applicable laws, orders, judgments, rules, codes, statutes, regulations, requirements, variances, decrees, writs, injunctions, awards, rulings or ordinances of any Governmental Authority. 1.24 "Liability" shall mean any direct or indirect obligation, indebtedness, claim, loss, damage, deficiency, cost, expense or responsibility, whether accrued, unaccrued, absolute, contingent, mature, unmature or otherwise and whether known or unknown, fixed or unfixed, choate or inchoate, liquidated or unliquidated, secured or unsecured. 1.25 "Material Adverse Effect" shall mean any change, event or effect with respect to the Business or Assets, together with all other changes, events and effects that have occurred prior to the date of determination, that has a material adverse effect on (i) the operations, assets or financial condition of the Business taken as a whole, but which shall not include general economic conditions which affects similarly situated businesses in a similar manner or (ii) the ability of Sellers to consummate the transactions contemplated hereby or to perform their obligations hereunder. 1.26 "Net Sales" shall mean gross third party sales of the Business less provision for customer discounts, rebates, promotions, and returns and allowances of the Gendex Operating Units, and less only customer returns at Intercompany Locations. 1.27 "Person" shall mean any natural person, corporation, general partnership, limited partnership, limited liability company, limited liability partnership, proprietorship, trust, union, association or other entity, enterprise or business organization. 1.28 "Product Liability Claim" shall mean any claim for personal or bodily injury which is based on or arises out of the design, manufacture, labeling, sale of, use of or exposure to any Product, regardless of whether such claim is founded in product liability, strict liability, breach of contract, breach of express or implied warranty, negligence, gross negligence, enterprise or alternate liability, concert of action, nuisance, the intentional or unintentional acts or omissions of the party against which the claim is made, its employees, agents or representatives, or any other theory of recovery. 1.29."Products" shall mean the products described on Schedule 1.28, Products. 1.30 "Purchase Price" shall mean US$102.5 million as may be subsequently adjusted pursuant to Section 2.3 and the other provisions of this Agreement. 1.31 "Schedules" shall mean the Schedules to this Agreement. 1.32 "Third Party Receivables" shall mean amounts due from non-Affiliates resulting from the sale of Product. 1.33 "Third Party Payables" shall mean amounts due to non-Affiliates for goods and services provided. 1.34 The phrase "transactions contemplated hereby (or by this Agreement)" shall include, without limitation, the Ancillary Agreements. 1.35 "Transferred Employee" shall mean employees of Sellers who are employed in connection with the Business by Sellers and become an employee of Buyer in connection with the transactions contemplated hereby. 1.36."US" and "USA" shall mean United States of America. 1.37 "US Business" shall mean the Gendex operating unit located in Des Plaines, Illinois, USA. 1.38 "US Facility" shall mean the property located at 901 W. Oakton Street, Des Plaines, Illinois, which is partially utilized by the Business. 1.39."VAT" shall mean any applicable value added tax. ARTICLE II - PURCHASE AND SALE OF ASSETS 2.1 Transfer. (a) At the Closing, Sellers shall sell, assign, transfer and deliver the Assets to Buyer free and clear of all Encumbrances, restrictions and rights of others (except for Permitted Encumbrances), and Buyer shall purchase and acquire the Assets from Sellers. (b) At any time after the Closing and prior to the second (2nd) anniversary of the Closing, Sellers shall assign, transfer and deliver to Buyer at Buyer's request any Contract (other than an Excluded Asset) relating primarily to the Business that was in effect prior to the Closing and that should have been on the Scheduled Contract list but was omitted (each, an "After-Assigned Contract"), and Buyer shall assume such After-Assigned Contract from Sellers. The consideration for the assignment of the After-Assigned Contracts shall be the payment of the Purchase Price under Section 2.2 of this Agreement and no further consideration shall be paid for such assignment. Sellers shall have no obligation under this provision to renew or re-enter any expired Contract. 2.2 Payment of Purchase Price. Buyer shall pay the Initial Payment to the order of Dentsply at the Closing by the wire transfer of immediately available funds from banks selected by Buyer to the account(s) selected by Dentsply and notified in writing to Buyer no later than one (1) business day prior to the Closing. 2.3 Adjustments to Purchase Price. (a) There shall be an adjustment to the Purchase Price for the Gendex Operating Units, if necessary, as set forth in this paragraph. Within ninety (90) days of Closing, the Buyer shall provide a statement to Dentsply of Buyer's calculation of the amount of Inventory, Third Party Payables, accrued liabilities (which does not include the liability for the frozen Gendex pension plan), Fixed Assets (gross asset value without depreciation or amortization) and other assets (prepaid assets and travel advances) for the Gendex Operating Units and Third Party Receivables for the EU Business ("Gendex Operating Unit Net Working Capital") as of Closing determined consistent with the past practices and accounting policies of Dentsply. To the extent the Gendex Operating Unit Net Working Capital is between $19,661,000 and $23,661,000, then no adjustments to the Purchase Price shall be made. To the extent that the Gendex Operating Unit Net Working Capital exceeds $23,661,000, Buyer shall pay such additional amount to Dentsply. To the extent the Gendex Operating Unit Net Working Capital is less than $19,661,000, Dentsply shall pay Buyer such amount. (b) There shall also be an adjustment to the Purchase Price, if necessary, for the Inventory at Intercompany Locations, as set forth in this paragraph. Within thirty (30) days of Closing, the Dentsply shall provide a statement to Buyer of the book value of the total Inventory at Intercompany Locations as of Closing. For purposes of this Section 2.3, the "value" of the Inventory shall mean the value computed in accordance with the first sentence of Section 4.10. If the book value of such Inventory is less than $1 million, Dentsply shall pay to Buyer the amount by which the value of such Inventory is below $1 million. Except as provided in the preceding sentence, there shall be no adjustment to the Purchase Price pursuant to this Section 2.3(b). (c) In the event that either Dentsply or Buyer provides notice that it disagrees/objects to any of the other Party's valuations as set forth in this Section 2.3, and the parties are unable to resolve such objection within thirty (30) days of such notice (the "Resolution Period") then such valuations shall be determined in accordance with the provisions of this Agreement by a USA national or large regional public accounting firm ("Neutral Auditor"). The fees and expenses of the Neutral Auditor shall be shared equally by Buyer and Dentsply. Buyer and Dentsply shall furnish to the Neutral Auditor such work papers and other documents and information relating to the disputed issues as the Neutral Auditor may request and are available to that party, and Buyer and Dentsply shall be afforded the opportunity to present to the Neutral Auditor any material relating to the determination and to discuss the determination with the Neutral Auditor. The Neutral Auditor shall determine only those issues still in dispute and shall apply appropriate accounting standards in reaching such determination. The Neutral Auditor's determination shall be made within thirty (30) days of its selection, shall be set forth in a written statement delivered to Dentsply and Buyer, and shall be final, binding and conclusive, except for manifest error. (d) "Neutral Auditor" shall mean KPMG LLP, or, in the event KPMG LLP has an actual conflict of interest at the time such dispute is to be submitted to it, to another public accounting firm mutually agreed on by the parties, or if the parties cannot agree on such firm within thirty (30) days after the conclusion of the Resolution Period, a USA national or large regional public accounting firm chosen by lot from a group of four (4) comprised of two (2) such firms nominated by each party (which shall not include a firm that has an existing relationship with either party). The failure of one party to submit the names of two such firms within five (5) business days of a written request to do so by the other party shall constitute a waiver of that right. (e) Any adjustments to the Purchase Price made pursuant to this Section 2.3 shall, within five (5) business days after the determination is agreed to by Buyer and Dentsply or is ultimately determined by the Neutral Auditor, be paid by wire transfer in immediately available funds to the account specified by the party to whom such payment is owed. 2.4 Assumption of Obligations; Retention of Excluded Obligations. (a) Buyer shall assume the obligations and liabilities described on Schedule 2.4, Assumed Obligations, and only the Assumed Obligations, as of the Closing. Buyer shall perform all Assumed Obligations and shall promptly reimburse Sellers for the reasonable out-of-pocket cost of performance actually incurred by Sellers in performing any Assumed Obligation the performance of which by Buyer is not accepted by the obligee in the exercise of such obligee's lawful rights. (b) Sellers shall retain the Excluded Obligations. Sellers shall perform all Excluded Obligations and shall promptly reimburse Buyer for the reasonable out-of-pocket cost of performance actually incurred by Buyer in performing any Excluded Obligation the performance of which any Seller is legally obligated to provide but is not provided by Sellers. 2.5 Proration. Real and personal property Taxes and assessments and other similar items which relate to an obligation with regard to the Assets for a time period which does not coincide with the Closing Date, shall be prorated between Sellers and Buyer based on the number of days in the period up to the Closing Date and after the Closing Date, and all other Taxes shall be prorated between Buyer and Sellers as if the tax period ended as of the close of business at 12:01 a.m. on the Closing Date, in each case with Sellers being responsible for payment of all such items with respect to the period before the Closing and Buyer being responsible for all such items with respect to the period after the Closing, regardless of when levied or due. 2.6..Instruments of Transfer and Assumption; Deliverables. (a) Sellers shall deliver to Buyer the following at the Closing (the delivery of any of which may be waived in writing by Buyer): (i) Assignment and Assumption Agreement. An Assignment and Assumption Agreement in a form reasonably acceptable to the parties duly executed by the appropriate Seller(s); (ii) Bill of Sale. A Bill of Sale selling, assigning, conveying and transferring the Assets to Buyer free and clear of all Encumbrances in a form reasonably acceptable to the parties duly executed by the appropriate Seller(s); (iii)Sublease. A Sublease in the form attached hereto as Exhibit 2.6A duly executed by the appropriate Seller(s); (iv) Patent Assignment. A Patent Assignment assigning Sellers entire right, title and interest in any Patents included in the Assets in a form reasonably acceptable to the parties duly executed by the appropriate Seller(s); (v) Trademark Assignment. A Trademark Assignment assigning Sellers entire right, title and interest in any Trademarks included in the Assets in a form reasonably acceptable to the parties duly executed by the appropriate Seller(s); (vi) Opinion of Counsel. An opinion of Dentsply's General Counsel, dated the Closing Date, in a form reasonably acceptable to the parties; (vii) Secretary's Certificate. A certificate executed by the Secretary of Dentsply certifying the due authorization of the Transactions contemplated herein by the Sellers and specimen signatures of the officers of Sellers authorized to sign this Agreement and the other documents contemplated hereby; (viii).....Encumbrance Releases. Releases of all encumbrances (other than Permitted Encumbrances) on the Assets; (ix) Consents. The consents from the other party to assignment of the Material Contracts identified on Schedule 2.6(a)(x); (x) Manufacturing Agreement. A Manufacturing Agreement in the form attached hereto as Exhibit 2.6B duly executed by the appropriate Seller(s); (xi) Representative Agreement. A Representative Agreement in the form attached hereto as Exhibit 2.6C duly executed by the appropriate Seller(s); and (xii) Non-Compete Agreement. A Non-Compete Agreement as agreed to by the parties. (b) Buyer shall deliver to Dentsply the following at the Closing (the delivery of any of which may be waived in writing by Seller): (i) Initial Payment. The Initial Payment by wire transfer of immediately available funds; (ii) Assignment and Assumption Agreement. An Assignment and Assumption Agreement in a form reasonably acceptable to the parties duly executed by Buyer; (iii)Sublease. A Sublease in the form attached hereto as Exhibit 2.6A duly executed by Buyer; (iv) Opinion of Counsel. An opinion of Wilmer, Cutler & Pickering, counsel to Buyer, dated the Closing Date, in a form reasonably acceptable to the parties; (v) Secretary's Certificate. A certificate executed by the Secretary of Buyer certifying that the due authorization of the Transactions contemplated herein by the Buyer and specimen signatures of the officers of Buyer authorized to sign this Agreement and the other documents contemplated hereby; (vi) Manufacturing Agreement. A Manufacturing Agreement in the form attached hereto as Exhibit 2.6B duly executed by Buyer; (vii) Representative Agreement. A Representative Agreement in the form attached hereto as Exhibit 2.6C duly executed by Buyer; and (viii).....Non-Compete Agreement. A Non-Compete Agreement as agreed to by the parties. (c) Before, at and after the Closing, Sellers shall take such reasonable and practicable steps to put Buyer in actual possession and operating control of the Assets as of the Closing. Without limiting the foregoing, as between Buyer and Sellers, Buyer shall have the unlimited right to possess and control the Assets as of the Closing, except as provided otherwise in this Agreement. 2.7..Consents. (a) Buyer and Sellers shall cooperate in securing before and after the Closing the prompt consent, approval, waiver or permit from each person or Governmental Authority whose consent, approval, waiver or permit is necessary to the Closing or for the conduct of the Business by Buyer after the Closing. The initial Hart-Scott-Rodino filings shall be made by Buyer and Dentsply within ten (10) business days after the date hereof and diligently prosecuted thereafter, looking toward a timely Closing. Buyer and Sellers agree to comply with other reasonable requests for information from Governmental Authorities, to the extent required by applicable Law. The parties will make all other filings required by any applicable antitrust or competition laws of any other jurisdiction as soon as practicable. Except as may be restricted by applicable Law, (i) the parties hereto shall cooperate with each other with respect to the obtaining of information needed for the preparation of the Notification and Report Forms required to be filed pursuant to Hart-Scott-Rodino or the applicable Law of any other jurisdiction in connection with the transactions contemplated hereby, (ii) the parties shall use reasonable efforts and shall cooperate in responding to any written or oral requests from Governmental Authorities for additional information or documentary evidence, and (iii) the parties shall cooperate and shall provide notice and opportunity to consult regarding all meetings with Governmental Authorities, whether in person or telephonic, and regarding all written communications with Governmental Authorities, in each case in connection with the transactions contemplated hereby. Notwithstanding this Section 2.7 or any other provision of this Agreement, for purposes of or in connection with obtaining clearance or approval from any Governmental Authority of the transaction described in this Agreement, Buyer shall not be obligated to (and shall not be obligated to cause any of its Affiliates to), agree to divest, hold separate or otherwise materially restrict the use or operation of any business or assets of Buyer (or any of its Affiliates) or agree to divest, hold separate or otherwise materially restrict the use or operation of the Business or Assets. (b) Nothing in this Agreement shall be deemed to constitute or require an assignment or an attempt to assign any Contract if the attempted assignment thereof, without the consent of any other party to such Contract, would constitute a breach thereof or adversely affect in any way the rights of any of the Sellers and its assignee thereunder. If, after Sellers shall have used commercially reasonable efforts (which shall not include or require the payment of additional amounts) to obtain such consents from any such third party, any such consent shall not have been obtained at or prior to the Closing, or the attempted assignment of such Contract without such consent at the Closing would have an adverse effect on such rights or Buyer would not in fact receive such rights, Sellers shall continue to use commercially reasonable efforts following the Closing to obtain such consent or, at Buyer's request, Sellers shall cooperate with Buyer in any reasonable arrangement, which shall not require additional cost or expense to Sellers (except for costs and expenses for which Buyer agrees to reimburse Sellers), designed to provide for Buyer the benefits thereunder, including enforcing for the benefit of Buyer, at Buyer's expense, any rights of Sellers against any such third party arising out of the breach or cancellation thereof by any such third party or otherwise. Nothing in this Section 2.7(b) shall be deemed to negate, limit or satisfy the deliveries required by Section 2.6(a)(x). 2.8..Further Assurances. (a) Buyer and Sellers shall each, from time to time after the Closing, at the request of the other and without further consideration, promptly execute and deliver such further instruments of assignment, transfer or assumption, and take such further action as the other may reasonably request in order to effectively transfer, reduce to possession and record title to any of the Assets, to permit Buyer to operate the Business or to implement the assumption of the obligations described in Section 2.4. (b) Within six (6) months after the Closing, Buyer shall, at its expense, prepare and submit to Sellers for signature the documentation necessary to record the transfers of the trademarks, patents and any applications therefor included in the Assets. Buyer shall thereafter exert reasonable efforts to promptly complete the recordation of such transfers. After the Closing, Sellers' obligation with respect to the maintenance of any Assets which are the subject of this Agreement, including trademark registrations, patents and patent applications not yet formally transferred to Buyer, shall be limited to prompt transmittal to Buyer of written notices relating thereto which are received by any of the Sellers. (c) Subsequent to Closing, Buyer shall take no action for the purpose of diminishing Sellers' ability to collect outstanding accounts receivables for Products sold by Sellers prior to Closing. This provision shall in no way restrict Buyer from operating the Business in the ordinary course. (d) Subsequent to Closing, Sellers shall take no action for the purpose of diminishing Buyer's ability to collect outstanding accounts receivables for Products sold by Buyer after Closing or the accounts receivable included in the Assets. This provision shall in no way restrict Sellers from collecting accounts receivable or conducting its business in the ordinary course. To the extent customers submit payment to Sellers of EU Receivables after Closing, Sellers shall promptly deliver such payment to Buyer (and in any event no later than five (5) business days after receipt). 2.9 Sales and Transfer Taxes; Fees. All sales, transfer, documentary, use, filing and other Taxes and fees (including, without limitation, withholding, excise and customs taxes) applicable to the sale, assignment, transfer or delivery of the Assets hereunder shall be borne equally by Buyer and Sellers. To the extent the sale of any of the Assets is subject to VAT or any similar such tax, Sellers shall be entitled to charge such Tax to Buyer in addition to the Purchase Price by presenting a bill corresponding to the applicable Tax. 2.10 Relocation of Assets. Buyer shall determine and advise Sellers within ninety (90) days of Closing where the Assets are to be delivered (other than inventory at Intercompany locations which may be left in place as consigned goods pursuant to the Representative Agreement). The costs of relocating Assets, to the extent necessary, from Sellers' premises to Buyer's premises shall be borne by Buyer. Such costs shall include, without limitation, delivery and transportation costs, dismantling, engineering costs associated with removing machinery and equipment and making consequent repairs to the vacated space for any damage or injury caused by such removal. The parties shall agree on a reasonable schedule for such relocation of Assets after the Closing, taking into account the need and capabilities of their Affiliates and the objective to complete such relocation on a reasonably prompt basis. 2.11 Transferred Employees. Buyer shall offer to continue the current employment, as of Closing, of all employees of the Business as required by local law, and the employees of the Gendex Operating Units, except as set forth in Schedule 4.12. To the extent required by the any of the agreements identified in Schedule 4.8(b) or (c) or local law, Buyer shall provide to Transferred Employees substantively similar terms and conditions of employment as provided to Transferred Employees prior to Closing, excluding the benefits derived from the DENTSPLY International Employee Stock Ownership Plan. In the event of termination by Buyer of a Transferred Employee within six (6) months of the Closing ("Terminated Employee"), such Terminated Employee(s) shall receive a severance payment from Buyer in accordance with applicable Sellers' severance plan in effect as of September 30, 2003 or as required by law, calculated with credit for service with Sellers. ARTICLE III - CONDITIONS PRECEDENT 3.1 Conditions to Buyer Closing. Except as may be waived by Buyer, the obligation of Buyer to close the transaction described herein is subject to the fulfillment of the following conditions: (i) the waiting period (and any extension thereof) under Hart-Scott-Rodino or under any other material applicable domestic or foreign Laws that suspends the right to close the transactions contemplated hereby shall have expired without any action being filed by the government thereunder; (ii) no temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal or regulatory restraint or provision challenging Buyer's proposed acquisition of the Business or limiting or restricting Buyer's operation of the Business following the Closing shall be in effect, nor shall any proceeding brought by an administrative agency or commission or other Governmental Authority, seeking any of the foregoing be pending, nor shall there be any action, suit, claim or proceeding of any nature pending with respect to the Business, that if decided adversely, would, individually or in the aggregate, be likely to result in a Material Adverse Effect; (iii) Sellers shall have performed or complied in all material respects with all obligations, agreements and covenants contained in this Agreement (or in any of the other documents or instruments to be delivered in connection herewith) to be performed or complied with by Sellers prior to the Closing; (iv) as of the date of this Agreement, to Sellers' knowledge, the representations and warranties of Sellers contained in this Agreement that are qualified with respect to materiality or Material Adverse Effect are true and correct in all respects, and any such representations and warranties that are not so qualified are true and correct in all material respects; (v) since the date of the Base Financial Statements, there shall not have been, individually or in the aggregate, any Material Adverse Effect or any change or event that would, within a reasonable period of time, likely result in a Material Adverse Effect; (vi) Buyer shall have received a certificate signed by an executive officer of Dentsply dated as of the Closing, to the effect that all of the conditions to closing in Section 3.1 have been satisfied or waived by Buyer; and (vii) Sellers shall have made all deliveries required to be made at or prior to the Closing pursuant to this Agreement, including those set forth in Section 2.6(a). Payment of any portion of the Purchase Price shall be Buyer's waiver of any condition described in this paragraph. 3.2 Conditions to Sellers Closing. Except as may be waived by Dentsply, the obligation of Sellers to close the transaction described herein is subject to the fulfillment of the following conditions: (i) the waiting period (and any extension thereof) under Hart-Scott-Rodino or under any material applicable domestic or foreign Laws that suspends the right to close the transactions contemplated hereby shall have expired without any action being filed by the government thereunder; (ii) no temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal or regulatory restraint or provision challenging Buyer's proposed acquisition of the Business, shall be in effect, nor shall any proceeding brought by an administrative agency or commission or other Governmental Authority, seeking any of the foregoing be pending; (iii) Buyer shall have performed or complied in all material respects with all obligations, agreements and covenants contained in this Agreement (or in any of the other documents or instruments to be delivered in connection herewith) to be performed or complied with by Buyer prior to the Closing; (iv) Dentsply shall have received a certificate signed by an executive officer of Buyer, dated as of the Closing, to the effect that all of the conditions to closing set forth in Section 3.2 have been satisfied or waived by Dentsply; and (v) Buyer shall have made all deliveries required to be made at or prior to the Closing pursuant to this Agreement, including those set forth in Section 2.6(b). ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF SELLER Except as set forth in this Agreement or the Schedules hereto, including specifically Schedule 4, Exceptions, Sellers jointly and severally represent and warrant to Buyer as of the date (except as otherwise stated within any such representation) of this Agreement and the Closing as follows: 4.1 Sellers Organization and Good Standing. Sellers are corporate entities duly organized, validly existing and in good standing under the laws of their state or country of formation, and have all requisite corporate power to execute, deliver and perform this Agreement and carry on their business as is now being conducted. Sellers are duly authorized and qualified to do business under all applicable Laws to own, lease and operate their properties and to carry on their business in the places and in the manner as now being conducted, except where the failure to be so authorized or qualified does not and would not have, individually or in the aggregate, a Material Adverse Effect. Sellers are duly qualified to do business as a foreign corporation and are in good standing in each jurisdiction in which failure to be so qualified would have, individually or in the aggregate, a Material Adverse Effect. 4.2 Authority; Execution and Delivery. The execution, delivery and performance of this Agreement by Sellers, including, without limitation, the sale, assignment, transfer and delivery contemplated hereby, have been duly and effectively authorized by all requisite corporate action by Sellers. No other corporate proceedings on the part of Sellers are necessary to authorize this Agreement and the transactions contemplated hereby; and this Agreement has been duly executed and delivered by Sellers and constitutes the legal, valid and binding obligation of Sellers enforceable against Sellers in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors' rights in general or general principles of equity. 4.3 Consents; No Conflicts. Subject to the provisions of this Agreement and satisfying the requirements of Hart-Scott-Rodino and similar applicable foreign Laws, the execution, delivery and performance by Sellers of this Agreement and the consummation by Sellers of the transactions contemplated hereby will not, with or without the giving of notice or the passage of time, (a) violate any Law, ordinance, rule or regulation, or any judgment, writ injunction or order of any court, arbitrator or Governmental Authority, applicable to Sellers in any manner which would have, individually or in the aggregate, a Material Adverse Effect, (b) constitute a violation of or conflict with any provision of the formation or governance documents of Sellers or any applicable resolution of the Board of Directors or stockholders of Dentsply, (c) require the consent, approval, permission or other authorization of or by or filing or qualification with any Governmental Authority, the failure of which to obtain would have, individually or in the aggregate, a Material Adverse Effect, (d) result in the creation of any Encumbrance upon the Assets under, or constitute a default or give rise to a right of termination under, any Material Contract, or (e) except as provided in clause (d), result in the creation of any Encumbrance upon the Assets under, or constitute a default or give rise to a right of termination under, any material license, franchise, Contract, lease, mortgage, agreement or other instrument concerning the Business to which any of the Sellers is a party or by which any of the Assets is bound or from which it derives benefit, in any manner which would have, individually or in the aggregate, a Material Adverse Effect. 4.4 Legal Proceedings. There is no legal proceeding or other legal action (including arbitrations, governmental investigations or inquiries) pending or, to Sellers' knowledge, threatened against Sellers that could prevent the consummation of the transactions contemplated by this Agreement or affect Sellers' ability to perform their obligations under this Agreement and no notice of any such legal proceeding or other legal action has been received by Sellers. 4.5 Financial Information. Schedule 4.5, Financial Information, reflects the pro forma Net Sales and Income From Operations associated with the Business for the fiscal years ending December 31, 2001 and 2002, and the nine (9) months ending September 30, 2003, and the pro forma condensed balance sheet of the Gendex Operating Units as of September 30, 2003, as included in the Consolidated Financial Statements of Dentsply which Consolidated Financial Statements are prepared in accordance with Dentsply's accounting procedures and GAAP applied on a consistent basis, such Financial Information being prepared as described in the definitions of and notes reflected on Schedule 4.5. The Deal Balance Sheet as reflected in Schedule 4.5 reflects the pro forma condensed balance sheet of the Gendex Operating Units as described above and in Note 1 of the Financial Information as contained in Schedule 4.5, adjusted for assets and liabilities that are not being transferred under this Agreement as described in Note 2 to the Financial Information in Schedule 4.5. 4.6 Permits and Registrations. The Sellers or Sellers' Affiliates hold all material permits, product import and manufacturing and other licenses, franchises, product registrations and other authorizations ("Permits") of any Governmental Authority necessary for the conduct of the Business. All such Permits have been duly obtained and are in full force and effect. Sellers are in all material respects in compliance with all such Permits, and no event has occurred and is continuing which permits, or after notice or lapse of time or both would permit, and to Sellers' knowledge no Governmental Authority intends to modify, cancel, terminate or not renew any material Permit. To Sellers' knowledge, no Person other than Sellers, own or has any proprietary interest (direct or indirect) in any material Permit. Such Permits are assignable to Buyer and will not be lost, modified or otherwise unavailable to Buyer in a manner which would materially affect Buyer's ability to conduct the Business as heretofore conducted. There are no pending applications for any material amendments or modifications to any such Permits. 4.7 Absence of Certain Changes or Events. Since January 1, 2003, there has not been any: (a) change in the Business' assets, liabilities or operations, except for changes which have been in the ordinary course of business consistent with past practice and which have not, individually or in the aggregate, had a Material Adverse Effect; (b) creation of any material Encumbrances against any of the Assets, except the lien of current real and personal property taxes and other governmental charges incurred but not yet due and payable, or other non-material Encumbrances incurred in the ordinary course of business consistent with past practice; (c) entering into, material modification, cancellation or termination of any Contract material to the Business, other than in the ordinary course of business and in accordance with their respective terms; (d) any increase in salary, bonuses or other compensation of the hourly and salaried employees of the Business, except in the ordinary course of business consistent with past practice, nor any entering into, amendment or termination in any material respect of any Seller Benefit Plan, Seller Benefit Arrangement, employment, severance, or other agreement relating to compensation or fringe benefits covering employees of the Business; (e) change in accounting methods or practices (including any change in depreciation or amortization policies or rates, or policies with respect to reserves for uncollectible accounts receivable or excess or obsolete inventory) or the revaluation of any assets of the Business (including the Assets); (f) material failure to operate the Business in the ordinary course consistent with past practice; or (g) negotiation or agreement by Sellers or any officer or employee thereof to do any of the things described in the preceding clauses (a) through (f) (other than negotiations in connection with the transactions of the type contemplated in this Agreement). 4.8 Contracts. (a) "Material Contract" shall mean any Contract (other than purchase orders in the ordinary course of business consistent with past practice) related to the Business or any Asset: (i) that may give rise to obligations or Liabilities exceeding $125,000 in any calendar year period (or the equivalent value in the applicable currency); (ii) containing any non-solicitation, non-competition, confidentiality or similar obligations which prohibits Sellers, in connection with the Business, from freely providing services or supplying products of the Business to any customer or potential customer in any part of the world; (iii) for cleanup, abatement or other actions in connection with any Hazardous Material, the remediation of any existing environmental Liabilities or violation of any Environmental Laws; or (iv) any license agreement relating to material Business Intellectual Property. (b) Schedule 4.8(b), Material Contracts, sets forth a complete and accurate list of all Material Contracts and constitutes all the Material Contracts in connection with the Business as conducted by Sellers. Each Material Contract, is in full force and effect and is a legal, valid, binding and enforceable obligation of or against each of the parties thereto. Except for breaches or defaults which have been cured and for which the breaching party has no Liability, none of the Sellers nor, to Sellers' knowledge, any other party to any Material Contract, has breached or defaulted in any material respect under, or has improperly terminated, revoked or accelerated, any Material Contract, and to Sellers' knowledge, there exists no condition or event which, after notice or lapse of time or both, would constitute any such breach, default, termination, revocation or acceleration. (c) Schedule 4.8(c) lists all Contracts (other than purchase orders in the ordinary course of business consistent with past practice) involved in the Business at the Gendex Operating Units which give rise to obligations or liabilities in excess of $50,000 in any calendar year period. Collectively, the Material Contracts and the Contracts listed on Schedule 4.8(c) are referred to herein as the "Scheduled Contracts." 4.9 Assets. Schedule 4.9, Fixed Assets, reflects all material items of machinery and equipment ("Fixed Assets") which are Assets hereunder. Except as set forth on Schedule 4.9 as excluded assets, the Fixed Assets constitute all machinery and equipment used in the Business as currently conducted by Sellers. Sellers have good and marketable title to, a valid leasehold in, or valid license or right to use, all Fixed Assets to be transferred to Buyer free and clear of all Encumbrances, except (a) the lien of current real and personal property taxes and other similar governmental charges incurred but not yet due and payable, (b) worker's, mechanic's, supplier's, carrier's, warehouseman's or other similar liens arising in the ordinary course of business consistent with past practice, and (c) such imperfections of title and Encumbrances, if any, as do not, individually or in the aggregate, materially detract from the value, or materially interfere with the present use, of the Assets or otherwise materially impair the operations of the Business (the liens described in clauses (a)-(c), "Permitted Encumbrances"). Each item of tangible personal property included in the Fixed Assets is in operating condition for the Business as currently conducted (ordinary wear and tear which are not such as to materially adversely affect the operation of the Business excepted). Except as set forth in the Schedules , the Fixed Assets (together with the Business Intellectual Property, the Real Property, the Scheduled Contracts, the Inventory and the Contracts assigned to Buyer pursuant to Section 1.3(c)), constitute all of the material assets, rights and properties used for the conduct of the Business as currently conducted by the Sellers and their Affiliates, other than at the Intercompany Locations, and for such Locations, constitute all of the material assets, rights and properties used primarily for the conduct of the Business as currently conducted. 4.10 Inventory. The values at which the Inventory of the Business is carried and set forth on the Base Financial Statements reflect the valuation policy of stating Inventories at cost or market, whichever is lower, on a first-in, first-out basis or average cost method, and reflect adequate write-offs, write-downs and reserves for damaged, defective, excess, slow-moving or obsolete items, computed in accordance with GAAP consistent with Sellers' past practices (except as reflected in the Notes to Schedule 4.5). The Inventory of the Business (net of all reserves for obsolete, excess, slow-moving and defective Inventory reflected on the Base Financial Statements), is usable or salable in the ordinary course of business consistent with past practice, conforms to the specifications established therefor, and includes (except as reserved as noted above) no damaged, defective, excess, slow-moving, or obsolete items. 4.11 Intellectual Property. (a) Definitions. (i) "Copyrights" shall mean registered and unregistered copyrights, copyright registrations, renewals thereof, and applications to register the same. (ii) "Domain Names" shall mean Internet domain names. (iii)"Intellectual Property" shall mean Trademarks, Patents, Copyrights, Software, Domain Names, Internet Sites, Licenses-In, Licenses-Out, Proprietary Rights and the goodwill associated therewith. (iv) "Internet Sites" shall mean URLs, and Internet web-sites and the content thereof. (v) "Licenses-In" shall mean licenses, sublicenses and agreements pursuant to which the Sellers have acquired rights in or to any of the Trademarks, Patents, Copyrights, Software, Domain Names or Proprietary Rights. (vi) "Licenses-Out" shall mean licenses, sublicenses and agreements pursuant to which any of the Sellers have licensed or transferred any rights to any of the Trademarks, Patents, Copyrights, Software, Domain Names or Proprietary Rights. (vii)"Patents" shall mean issued foreign and domestic patents, patent rights, patent applications. (viii) "Proprietary Rights" shall mean categories of trade secrets, trade dress, know-how, inventions, invention disclosures (whether or not patentable and whether or not reduced to practice), inventor rights, reports, discoveries, developments, research and test data, blueprints, technology, ideas, compositions, quality records, engineering notebooks, models, processes, procedures, prototypes, patent records, manufacturing and product procedures and techniques, troubleshooting procedures, failure/defect analysis data, drawings, specifications, designs, ingredient or component lists, formulae, plans, proposals, technical data, copyrightable works, financial, marketing, customer and business data, pricing and cost information, business and marketing plans, selling information, marketing information, customer and supplier lists and information, and all other confidential and proprietary information. (ix) "Software" shall mean software, computer programs, computer systems, modules and related data and databases and materials. (x) "Trademarks" shall mean registered and unregistered trademarks, trademark registrations, trademark rights and renewals thereof, trade names, trade name rights, servicemarks, servicemark registrations and renewals thereof, servicemark rights, and all applications to register the same. (xi) "Transferred Software" shall mean (i) in the case of Software subject to standard, off-the-shelf, non-exclusive shrinkwrap software licenses granted to end-user customers by third parties in the ordinary course of such third parties' business, all such Software used by Sellers exclusively in the Business, and (ii) in the case of all other Software, such Software used by Sellers primarily in the Business. (b) Schedules 4.11 A, B and C collectively set forth a complete list, in each case, of (i) all United States and foreign Trademarks and Patents owned and/or used in connection with the Business as conducted by Sellers, (ii) Domain Names, and Internet Sites used by Sellers exclusively in the Business, and (iii) Licenses-In and Licenses-Out of Patents and Trademarks in connection with the Business (collectively, the "Listed Intellectual Property"). (c) Each item of Listed Intellectual Property is subsisting, and all necessary registration, maintenance and renewal fees currently due in connection with such Listed Intellectual Property have been paid and all appropriate documents and certificates in connection with such Listed Intellectual Property have been filed with the relevant patent, copyright, trademark or other authorities in the United States or foreign jurisdictions, as the case may be, as necessary for maintaining or prosecuting such Listed Intellectual Property in the countries indicated on the Schedule. (d) Sellers own and have good and marketable title to, or possess legally enforceable and transferable rights to use under valid and subsisting written license agreements (each of which is listed on Schedule 4.8 and true and correct copies of which have been provided to Buyer), each item of Listed Intellectual Property, Transferred Software and each other item of Intellectual Property primarily used in the Business as currently conducted by Sellers (such Transferred Software and other Intellectual Property, together with the Listed Intellectual Property, the "Business Intellectual Property"), in each case free and clear of any Encumbrances (excluding licenses and related restrictions disclosed on any schedule hereto). (e) The Business Intellectual Property and operations of Sellers in conducting the Business (including the performance of any Contract) as conducted in the past and as now conducted have not and do not, to Sellers' knowledge, (i) infringe on any Intellectual Property of any third party, (ii) constitute a misappropriation of any Intellectual Property of any third party, (iii) entitle any third party to any interest therein, or right to compensation from any Seller or any of its successors or assigns, by reason thereof (excluding licenses), or (iv) violate any applicable Law. Sellers have not received any written complaint, threat, allegation, invitation to license, or assertion of any claim, litigation, or proceeding that the Business Intellectual Property or operations of Sellers in conducting the Business infringe upon or conflict with the rights of any third party Intellectual Property. 4.12.Employee Matters. (a) With respect to employees of the Business, the following terms shall have the following meanings: (i) "Benefit Arrangement" shall mean any benefit arrangement, obligation, or practice, whether or not legally enforceable, to provide benefits (other than merely as salary or under a Benefit Plan), as compensation for services rendered, to present or former directors, employees, agents, or independent contractors, including, but not limited to, employment or consulting agreements, severance agreements or pay policies, stay or retention bonuses or compensation, executive or incentive compensation programs or arrangements, sick leave, vacation pay, plant closing benefits, salary continuation for disability, workers' compensation, retirement, deferred compensation, bonus, stock option or purchase plans or programs, patent award, tuition reimbursement or scholarship programs, employee discount programs, meals, travel, or vehicle allowances, any plans subject to Code Section 125, and any plans providing benefits or payments in the event of a change of control, change in ownership or effective control or sale of a substantial portion (including all or substantially all) of the assets of any business or portion thereof, in each case with respect to any present or former employees, directors, or agents. (ii) "Benefit Plan" shall have the meaning given in ERISA Section 3(3), together with plans or arrangements that would be so defined if they were not (A) otherwise exempt from ERISA by that or another section, (B) maintained outside the United States, or (C) individually negotiated or applicable only to one person. (iii) "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended, and all regulations and rules issued thereunder, or any successor law. (iv) "ERISA Affiliate" shall mean any person or entity that, together with the entity referenced, would be or was at any time treated as a single employer under Code Section 414 or ERISA Section 4001 and any general partnership of which the entity is or has been a general partner. (v) "Foreign Plan" shall mean any Benefit Plan or Benefit Arrangement covering any employee of the Business, which plan, program or arrangement is subject to the laws of any jurisdiction outside of the United States. (vi) "Multiemployer Plan" shall mean any Benefit Plan described in ERISA Section 3(37). (vii) "Pension Plan" shall mean any Benefit Plan subject to Code Section 412 or ERISA Section 302 or Title IV (including any Multiemployer Plan) or any comparable plan not covered by ERISA. (viii)....."Seller Benefit Arrangement" shall mean any Benefit Arrangement any Seller sponsors or maintains or with respect to which any Seller has or may have any current or future liability (whether actual, contingent, with respect to any of its assets or otherwise), in each case with respect to any present or former employees of the Business. (ix) "Seller Benefit Plan" shall mean any Benefit Plan that any Seller maintains or has previously maintained or to which any Seller is obligated to make payments or has or may have any liability, in each case with respect to any present or former employees of any Seller. (b) Schedule 4.12, Employment Terms, describes the material Benefit Plans and arrangements in connection with the Business and the treatment of same in connection with the transactions contemplated in this Agreement. (c) Dentsply has previously delivered to Buyer a list of employees employed exclusively in connection with the Business, including levels of compensation. (d) No labor union or workers' council represents or has ever represented the employees of the Business and no collective bargaining agreement is or has been, to the Sellers' knowledge, binding against Sellers in connection with the Business. No grievance or arbitration proceeding arising out of or under collective bargaining agreements or employment relationships is pending; and no claims therefore exist or have, to the Sellers' knowledge, been threatened; no labor strike, lock-out, slowdown, or work stoppage is or has in the last five (5) years been pending or, to the Sellers' knowledge, threatened against the Business. (e) Except as provided in Schedule 4.12, Employment Terms, or as otherwise provided in Section 2.11, Buyer will have no liability with respect to any Seller Benefit Plan or Seller Benefit Arrangement. (f) All group health plans of Dentsply and its ERISA Affiliates comply and have complied with the requirements of Part 6 of Title I of ERISA (COBRA). (g) Each Foreign Plan (i) has been maintained in all material respects in accordance with all applicable legal requirements and with its terms; (ii) to the extent it has qualified for special tax treatment, meets all requirements for such treatment; and (iii) if required to be registered, has been registered with the appropriate authorities and has been maintained in good standing with the appropriate regulatory authorities. (h) Sellers comply and have complied in all material respects with all applicable domestic and foreign Laws relating to employees of the Business respecting employment and employment practices, terms and conditions of employment and wages and hours, and no claims, controversies, investigations, or suits are pending or, to Sellers' knowledge, threatened with respect to such Laws, either by private individuals or by governmental agencies. (i) With respect to the employees of the U.S. Business, no Seller has effectuated in any way (i) a plant closing as defined in the Worker Adjustment and Retraining Notification Act of 1988, as amended from time to time (the "WARN Act"), affecting any site of employment or one or more operating units within any site of employment of any Seller or (ii) a mass layoff as defined in the WARN Act, nor has any Seller been affected by any transaction or engaged in layoffs or employment terminations sufficient in number to trigger application of any similar state or local Law. None of the employees of the Business have suffered an employment loss as defined in the WARN Act during the ninety-day period prior to the Closing. 4.13 Litigation. Except as set forth on Schedule 4.13, Litigation, there is no order, writ, injunction, judgment or decree outstanding or claim, suit, litigation or proceeding, pending or, so far as known to Dentsply, threatened against, relating to or affecting any Seller with respect to the Business or the transactions contemplated by this Agreement, to the extent any of the foregoing would, individually or in the aggregate, be material to the Business. Except as set forth on Schedule 4.13, no Product Liability Claims involving amounts in excess of $100,000.00, if adversely determined against the Business, have occurred in the last three (3) years. 4.14 Compliance with Laws. The Business has been and is currently conducted by Sellers without the violation of any applicable Law in a manner which would, individually or in the aggregate, materially affect the Business and no claim has been alleged or, to Sellers' knowledge, threatened, asserting Sellers' violation of, Liability for, or potential responsibility in any material respect, under any Law in connection with Sellers operation of the Business. No Product has experienced any safety or efficacy problems that would materially change its approved indications as a result of any adverse experience report received by Sellers, and no material change in the labeling of any Product has been required by any governmental or regulatory body, or determined to be implemented by Sellers, as a result of such an adverse experience report. There is no pending, or to Sellers' knowledge, threatened notice of non-compliance or impending regulatory action from any USA or foreign Government Authority with respect to the Assets, Products or the Business. 4.15 Product Warranties. The terms of Sellers' standard product warranties and extended warranties sold by or on behalf of Sellers relating to Products have been provided to Buyer. Except as set forth therein or in Schedule 4.15, Sellers have made no express warranty with respect to any Product. Schedule 4.15, Warranty, reflects the warranty reserve maintained by Dentsply for the Business as of the date reflected therein. Such warranty reserve has been established in the ordinary course of business and is consistent with the historical warranty experience of the Business. To Sellers' knowledge, (a) there are no statements, citations or decisions by any Governmental Authority or any product testing laboratory stating that any product of the Business is unsafe or fails to meet any applicable standards promulgated by such Governmental Authority or testing laboratory, (b) there is no material design, manufacturing or other defect in any model of the Products, and (c) there is no pending or threatened mandatory or voluntary product recalls with respect to any Products and (d) there is no fact relating to any Products that may impose a duty on Sellers to recall any Product. Schedule 4.15 sets forth a complete list of any product recalls relating to the Products in the five (5) years prior to this Agreement. 4.16 Receivables. The Third Party Receivables of the EU Business ("EU Receivables") are valid and enforceable claims against customers for goods or services delivered or rendered in the ordinary course of business consistent with past practice. No portion of the EU Receivables is required or expected to be paid to any Person other than a Seller. The EU Receivables are current and collectible net of any reserves specifically applicable thereto set forth on the Base Financial Statement, determined in accordance with GAAP consistently applied. There is no contest, claim, or right of set-off, other than rebates and returns in the ordinary course of business consistent with past practice, under any Contract with any maker of an EU Receivable relating to the amount or validity of such EU Receivable. 4.17 Brokers. Except for UBS Securities LLC, Sellers have not engaged the services of any person to represent Sellers in the negotiation or conclusion of the transactions contemplated hereby. 4.18 Complete Copies of Contracts. Dentsply made available for inspection by Buyer true and complete copies of each document referenced in the Schedules to this Agreement, except for Excluded Assets. 4.19.Environmental Matters. (a) "Environmental Laws" shall mean all federal, state, local, and foreign Laws and common law Liability, relating to pollution or protection of human health or the environment, including, Laws relating to indoor or outdoor releases or threatened releases, importation, manufacture, processing, use, treatment, storage, disposal, transport, or handling of hazardous substances, hazardous wastes, petroleum or petroleum by-products, or pollutants or contaminants of any kind. ...........(b) Except as set forth on Schedule 4.19, Environmental Matters, each Seller is and has been in material compliance with all applicable Environmental Laws with respect to the Business; no Seller has received within the last three (3) years and there are no pending communications (written or oral) from a Governmental Authority that alleges that Sellers are not in compliance with Environmental Laws with respect to the Business. ...........(c) Except as set forth on Schedule 4.19, there is no claim, action, cause of action, investigation, or notice (written or oral) with respect to the Business by any Governmental Authority or any other person pending or, to Sellers' knowledge, threatened, against Sellers or against any Person whose Liability Sellers have retained or assumed either contractually or by operation of law, pursuant to any Environmental Law. ...........(d) Except as set forth on Schedule 4.19, there is no asbestos contained in or forming part of any products of the Business currently or previously manufactured, distributed or sold by Sellers. ...........(e) Except as set forth on Schedule 4.19, to Sellers' knowledge, there are no past or present actions, activities, circumstances, conditions, events or incidents with respect to the Business that establish any Liability of any Seller or of any Person whose Liability Sellers has retained or assumed either contractually or by operation of law, pursuant to any Environmental Law. 4.20.Real Property. (a) Schedule 4.20, Real Property, lists: (i) a description of each parcel of real property owned by any of the Sellers which is used exclusively in connection with the Business (the "Fee Real Property"); (ii) each lease, whether oral or written, of real property used exclusively in connection with the Business under which any Seller is a lessee, lessor, sublessee or sublessor, as so designated therein (the "Leases" and together with the Fee Real Property, the "Real Property"); and (iii) all options to acquire, sell or lease any real property interests exclusively in connection with the Business to which any Seller is a party ("Real Property Options"). (b) Except as set forth on Schedule 4.20, (i) all Leases are valid, binding, in full force and effect, free and clear of all Encumbrances, other than non-monetary items which do not and will not impair, in any material respect, the usefulness to the Business; (ii) no written notice of default or termination under the Leases has been received by Sellers and no uncured default on the part of Sellers exist thereunder; (iii) there are no restrictions that prevent Sellers from their continued use, occupancy and operation as used, occupied and operated in connection with the Business as currently conducted; (iv) Dentsply is not a "foreign person" as that term is defined in Section 1445 of the Code and any applicable regulations promulgated thereunder; (v) Sellers have not received notice from any municipal body or other public authority requiring work to be done or improvements to be made upon any of the Real Property; (vi) there are no Persons other than Sellers in possession of any Real Property leased by Sellers or any portion thereof; (vii) no condemnation or similar proceeding is pending or, to Sellers' knowledge, threatened, that would preclude or impair the use of any Real Property leased by Sellers, or any portion thereof, for the purposes for which it is currently used; (viii) there is not under any Lease any default by Sellers or, to Sellers' knowledge, any other party to any Lease, or any condition, event or act which would constitute such a default with the giving of notice or the passage of time, or both. 4.21 Significant Customers and Suppliers. (a) Schedule 4.21(a), Significant Customers and Suppliers, sets forth (i) a true and correct customer list showing the ten (10) largest third party customers by gross purchases from the Gendex Operating Units during the nine (9) month period ended on the date of the Base Financial Statements (individually, a "Significant Customer" and collectively, the "Significant Customers"), and (ii) a true and correct supplier list showing (A) the ten (10) largest suppliers by gross sales to the Gendex Operating Units during the nine (9) month period ended on the date of the Base Financial Statements and, (B) any sole source Suppliers to the Business that are identified as a Material Contract on Schedule 4.8(b) ("Significant Supplier"). (b) Since January 1, 2003, no Significant Customer or Significant Supplier has (whether as a result of the transactions contemplated hereby or otherwise) (i) stopped, or to Sellers' knowledge indicated an intention to stop, trading with or supplying the Business, (ii) notified Sellers that it is going to materially reduce or discontinue business with the Sellers, or (iii) materially changed or notified Sellers that it is going to change the basic terms on which it does or will do business with Sellers in a manner which materially deviates from the past course of conduct or dealings with the Sellers. 4.22 Taxes. (a) Definitions. (i) "Tax" shall mean any tax or similar charge, impost, or levy imposed by a Governmental Authority, including, without limitation, any federal, state, local, or foreign income, gross receipts, license, payroll, employment, excise, stamp, occupation, windfall profits, customs duties, capital stock, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind whatsoever, together with any interest, penalties, fines, or additions thereto, whether disputed or not. (ii) "Tax Return" means any return (including information return), report, statement, schedule, notice, form, estimate or declaration of estimated tax relating to or required to be filed with any Governmental Authority in connection with the determination, assessment, collection or payment of any Tax. (b) Except as set forth on Schedule 4.22, Taxes: (i) All Taxes owed by or with respect to the Business due on or before the Closing Date (whether or not shown on any Tax Return) have been paid in full on a timely basis. (ii) There are (and immediately following the Closing there will be) no Encumbrances on the Assets relating to or attributable to Taxes, except for Taxes not yet due and payable. Sellers have no knowledge of any basis for the assertion of any Tax claims that, if adversely determined, would result in a material Encumbrance on the Assets or the Business. 4.23 Bank Accounts; Powers of Attorney. Schedule 4.23 sets forth a complete and accurate list of all bank accounts, safe deposit boxes and lock boxes of any Seller used primarily for the Business, including, with respect to each such account and lock box, the names in which such accounts or boxes are held. Schedule 4.23 also sets forth the name of each Person holding a general or special power of attorney from any Seller for use in connection with the Business and a description of the terms of such power. 4.24 Backlog. All pending customer orders for the Business were entered into in the ordinary course of business consistent with past practice. No such customer orders are at prices which, based on the past experience of Sellers and current and anticipated costs, are or can reasonably be expected to result in a material loss to the Business. 4.25 Unlawful Payments. To Sellers' knowledge, neither Sellers nor any director, officer, employee, stockholder, agent or representative of (or any other Person associated with or acting for or on behalf of) Sellers, have directly or indirectly (i) made any contribution, gift, bribe, rebate, payoff, influence payment, kickback, or other payment to any Person, private or public, regardless of what form, whether in money, property, or services (A) to obtain favorable treatment for the Business or to secure Contracts, (B) to obtain special concessions or for special concessions already obtained for the Business, or (C) in violation of any legal requirement in connection with the Business. 4.26 Absence of Claims; Business Relationships With Affiliates. Except as set forth in Schedule 4.26, no Affiliate of Dentsply as of Closing will have any claim or cause of action against the Buyer or the Business and there are no arrangements with any Affiliates related to the Business the discontinuance of which would have, individually or in the aggregate, a Material Adverse Effect. 4.27 Books and Records. Sellers have made and kept business records in the ordinary course of business (which might include financial books and records, sales order files, purchase order files, engineering order files, warranty and repair files, supplier lists, customer lists, dealer, representative and distributor lists, studies, surveys, analyses, strategies, plans, forms, designs, diagrams, drawings, specifications, technical data, production and quality control records and formulations) (collectively, "Books and Records") which reflect the activities of the Business. 4.28 Trade Accounts Payable. The Trade Payables as shown in the Base Financial Statements reflects the gross amount of Third Party Payables due to non-affiliates for goods and services provided, compiled in accordance with GAAP as of the date of the Base Financial Statements. ARTICLE V - REPRESENTATIONS AND WARRANTIES OF BUYER Buyer represents and warrants to Sellers as of the date of this Agreement and Closing as follows: 5.1 Buyer's Organization, Power, Execution. Buyer is a corporation duly incorporated, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate power and authority to execute, deliver and perform this Agreement and carry out the transactions contemplated hereby. The execution and delivery of this Agreement, and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of Buyer, and this Agreement has been duly executed and delivered by Buyer and constitutes a valid and legally binding obligation of Buyer in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors' rights in general or general principles of equity. 5.2 Non-Violation. Subject to satisfying the requirements of Hart-Scott-Rodino and similar applicable foreign laws, the execution, delivery and performance by Buyer of this Agreement and the consummation by Buyer of the transactions contemplated hereby will not, with or without the giving of notice or the passage of time, (a) violate any law, ordinance, rule or regulation, or any judgment, writ injunction or order of any court, arbitrator or governmental, administrative or self-regulatory authority, applicable to Buyer in any manner which would materially adversely affect the rights of any Seller under this Agreement, (b) constitute a violation of or conflict with any provision of the certificate of incorporation or by-laws of Buyer, or (c) require the consent, approval, permission or other authorization of or by or filing or qualification with any court, arbitrator or governmental, administrative or self-regulatory authority, the failure of which to obtain would materially adversely affect the rights of any Seller under this Agreement. 5.3 Legal Proceedings. There is no legal proceeding or other legal action pending or, to Buyer's knowledge, threatened against Buyer that could prevent the consummation of the transactions contemplated by this Agreement or materially affect Buyer's ability to perform its obligations under this Agreement or the Ancillary Agreements. 5.4 Brokers. Buyer has not engaged the services of any person to represent Buyer in the negotiation or conclusion of the transactions contemplated hereby. 5.5 Cash Resources. Buyer has an amount of cash or readily available financing which is sufficient to pay the Purchase Price at Closing, as well as all Buyer-related fees and expenses associated with such transaction. ARTICLE VI - COVENANTS OF SELLER Sellers covenant and agree as follows: 6.1 Conduct of the Business. Except as otherwise permitted by this Agreement or consented to by Buyer in writing, Sellers shall conduct the Business in the ordinary course consistent with past practice. Without limiting the foregoing, Sellers shall maintain the Assets in the condition existing at the time of this Agreement (ordinary wear and tear excepted), keep in full force and effect its present insurance policies or other comparable insurance coverage with respect to the Business, comply with, and perform in all material respects obligations under, all Scheduled Contracts, all applicable Laws and all Permits related to the Business and use commercially reasonable efforts (payment of additional costs or liabilities outside the ordinary course of business shall not be considered reasonable) to preserve intact its present business organization, to keep available the services of its present employees, and to preserve its relationships with customers, suppliers and others having business dealings with it. 6.2 Certain Changes. Except as otherwise permitted by this Agreement, consented to by Buyer in writing or disclosed in the Schedules hereto between the signing of this Agreement and the Closing, Sellers shall not: (a) subject any of the Assets to any material Encumbrance; (b) dispose of any of the Assets, or any interest therein except in the ordinary course of business consistent with past practice; (c) grant any material increase in compensation or benefits to any employee who will transfer to Buyer with the Business; (d) breach, terminate or allow the expiration of, waive any right under, or materially modify or amend, any Scheduled Contract or Material Permit, except in accordance with its terms; (e) make any capital expenditure in connection with the Business in excess of $100,000; or (f) take or agree to take (in writing or otherwise) any other action which will prevent the consummation of the transactions contemplated hereby or materially diminish the value of the Business. 6.3 Access to Information. Sellers shall afford to the officers and authorized representatives of Buyer access to, in the form in which it is kept by Sellers for the normal operation of the Business (i) all of the Assets (including the Real Property) and Books and Records related to the Business and (ii) such additional financial and operating data and other information relating to the Business as Buyer may from time to time reasonably request, including access upon reasonable request to the Business's employees, customers, vendors, suppliers and creditors. Sellers shall reasonably cooperate with Buyer, its representatives, auditors and counsel in the preparation of any documents or other material which may be required in connection with this Agreement. 6.4 Exclusivity. Sellers shall, and shall direct their respective officers, directors, employees, representatives, agents and Affiliates, to, discontinue and cease any existing discussions or negotiations, if any, with any parties with respect to any purchase or acquisition of all or a material portion of the Assets related to the Business (each, an "Acquisition Transaction"). Each Seller agrees that prior to the earlier of the Closing or the termination of this Agreement, it shall not, and shall not authorize or permit any of its officers, directors, employees, representatives, agents and Affiliates, directly or indirectly to solicit, initiate or encourage, or furnish or disclose information in furtherance of, any inquiries or the making of any proposal with respect to any Acquisition Transaction or negotiate, explore or otherwise engage in substantive discussions with any Person with respect to any Acquisition Transaction or enter into any agreement, arrangement or understanding requiring it to abandon, terminate or fail to consummate any of the transactions contemplated by this Agreement. 6.5 VAT Refund. Sellers shall provide to Buyer the benefit of that portion of the VAT refund due from the Governmental Authority in Italy to Italia (the "VAT Refund"), and which is solely attributable to the business operations of the EU Business located in Cusano Milanino, Italy, as reflected in, and as of the date of, the Deal Balance Sheet. As of that date, the VAT Refund is equal to 1,987,818 Euro (the "VAT Refund Amount"). In the event that after good faith efforts, Buyer is unable to obtain the full benefit of the VAT Refund Amount from the Governmental Authority in Italy within the six month anniversary date of Closing, Sellers shall pay to Buyer that portion of the VAT Refund Amount that Buyer does not obtain from the Governmental Authority in Italy (the "VAT Differential"), up to a total amount of $2,315,808, and Buyer shall assign all of its rights to its claims against the Governmental Authority for such amounts to the Sellers. In the event Buyer obtains the benefit of any portion of the VAT Refund after receiving payment of the VAT Differential from Sellers, Buyer covenants and agrees to return to Sellers that amount of the VAT Refund of which it obtains the benefit within 30 days of Buyer's receipt of each such refund. ARTICLE VII - OTHER AGREEMENTS 7.1 Books and Records. For a period of not less than three (3) years from the Closing (plus any additional time during which a party has been advised that there is a tax audit with respect to a period prior to the Closing), Buyer and Sellers shall each, at the request of the other party, make available to such other party from time to time on a reasonable basis, records and other