Document:

Unit Purchase Agreement

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    

     

    

    UNIT
      PURCHASE AGREEMENT

     

    

    AMONG

    

    PRESTIGE
      BRANDS HOLDINGS, INC.

     

    AND

     

    DENTAL
      CONCEPTS, LLC,

     

    RICHARD
      GACCIONE,

     

    COMBINED
      CONSULTANTS DBPT GORDON WADE,

     

    DOUGLAS
      A.P. HAMILTON, ISLANDIA L.P., GEORGE O’NEILL,

     

    ABBY
      O’NEILL, MICHAEL PORTER, MARC COLE AND MICHAEL LESSER

     

    

    

    DATED
      NOVEMBER 9, 2005

    

    
      
        
          

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

           

          

        

      

    

    1.
      DEFINITIONS

     

    2.
      SALE
      AND
      TRANSFER OF SECURITIES; CLOSING

     

    2.1
      Securities

     

    2.2
      Purchase
      Price

     

    2.3
      Closing

     

    2.4
      Closing
      Deliveries

     

    2.5
      Allocation

     

    2.6
      Gross-Up

     

    2.7
      Estimates;
      Adjustments

     

    2.8
      Closing
      Balance Sheet

     

    2.9
      Sellers’
      Agent

     

    3.
      REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY

     

    3.1
      Organization
      and Good Standing

     

    3.2
      Authority;
      No Conflict

     

    3.3
      Capitalization

     

    3.4
      Financial
      Statements

     

    3.5
      Books
      and
      Records

     

    3.6
      Title
      to
      Properties; Encumbrances

     

    3.7
      Adequacy
      of Reserve for Returns

     

    3.8
      Condition
      and Sufficiency of Assets

     

    3.9
      Accounts
      Receivable and Payable

     

    3.10
      [Delete.]

     

    3.11
      Inventory

     

    3.12
      No
      Undisclosed Liabilities

     

    3.13
      Taxes

     

    3.14
      No
      Material Adverse Effect

     

    3.15
      Employee
      Benefits

     

    3.16
      Compliance
      With Legal Requirements; Governmental Authorizations

     

    3.17
      Legal
      Proceedings; Orders

     

    3.18
      Absence
      of Certain Changes and Events

     

    3.19
      Contracts;
      No Defaults

     

    3.20
      Insurance

     

    3.21
      Environmental
      Matters

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    3.22
      Employees

     

    3.23
      Labor
      Relations

     

    3.24
      Intellectual
      Property

     

    3.25
      Certain
      Payments

     

    3.26
      Relationships
      With Related Persons

     

    3.27
      Payout
      Arrangements

     

    3.28
      Brokers
      or Finders

     

    4.
      REPRESENTATIONS
      AND WARRANTIES OF BUYER

     

    4.1
      Organization
      and Good Standing

     

    4.2
      Authority;
      No Conflict

     

    4.3
      Investment
      Intent

     

    4.4
      Certain
      Proceedings

     

    4.5
      Brokers
      or Finders

     

    4.6
      Breach
      by
      Sellers of the Company

     

    5.
      INDEMNIFICATION;
      REMEDIES; ESCROWED FUNDS

     

    5.1
      Obligation
      to Indemnify 
      

     

    5.2
      Notice
      of
      Asserted Liability

     

    5.3
      Opportunity
      to Defend

     

    5.4
      Traditional
      Escrowed Funds

     

    5.5
      Regulatory
      Escrowed Funds

     

    5.6
      Damages
      Net of Insurance, Etc

     

    5.7
      Collateral
      Sources

     

    5.8
      Limitation
      of Remedies

     

    6.
      ADDITIONAL
      AGREEMENTS

     

    6.1
      Continuation
      of Insurance

     

    6.2
      Access
      to
      Records

     

    7.
      TAX
      COVENANTS

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    7.1
      SELLERS’
      LIABILITY

     

    7.2
      Buyer’s
      Liability

     

    7.3
      Apportionment
      of Income Taxes

     

    7.4
      Preparation
      of Tax Returns

     

    7.5
      Other
      Covenants

     

    7.6
      Contests

     

    7.7
      Cooperation

     

    7.8
      Payroll
      Tax

     

    7.9
      Termination
      of Tax Sharing Agreements

     

    8.
      GENERAL
      PROVISIONS

     

    8.1
      No
      Reliance on Other Information

     

    8.2
      Expenses

     

    8.3
      Survival

     

    8.4
      Public
      Announcements

     

    8.5
      Notices

     

    8.6
      Jurisdiction;
      Service of Process

     

    8.7
      Further
      Assurances

     

    8.8
      Waiver

     

    8.9
      Entire
      Agreement and Modification

     

    8.10
      Disclosure
      Letter

     

    8.11
      Assignments,
      Successors and Third-Party Rights

     

    8.12
      Severability

     

    8.13
      Section
      Headings, Construction

     

    8.14
      Time
      of
      Essence

     

    8.15
      Governing
      Law

     

    8.16
      Counterparts

     

    

     

    

    
      
        
          

          

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

           

          

        

      

    

    UNIT
      PURCHASE AGREEMENT

     

    This
      Unit
      Purchase Agreement (this “Agreement”)
      is
      made as of November 9, 2005, by and between Prestige Brands Holdings, Inc.,
      a
      Delaware corporation (“Buyer”),
      and
      each of Dental Concepts, LLC, a Delaware limited liability
      company (the “Company”),
      Richard Gaccione, Combined Consultants DBPT Gordon Wade, Douglas A.P. Hamilton,
      Islandia L.P., George O’Neill, Abby O’Neill, Michael Porter, Marc Cole and
      Michael Lesser (collectively, “Sellers”).

     

    RECITALS

     

    Sellers
      are all of the members of the Company. Sellers desire to sell, and Buyer desires
      to purchase, all of the issued and outstanding membership interests (the
“Securities”)
      of the
      Company from the Sellers for the consideration and on the terms set forth in
      this Agreement.

     

    AGREEMENT

     

    The
      parties, intending to be legally bound, agree as follows:

     

    1.  DEFINITIONS

     

    For
      purposes of this Agreement, the following terms have the meanings specified
      or
      referred to in this Section 1:

     

    Accounts
      Payable
      - as
      defined in Section 3.9.

     

    Accounts
      Receivable
      - as
      defined in Section 3.9.

     

    Actual
      Cash
      - the
      amount of Cash of the Company as of November 8, 2005 reflected on the Closing
      Balance Sheet, as finally agreed to by the parties or determined by the
      Independent Auditor under Section 2.8.

     

    Actual
      Indebtedness
      - the
      amount of Indebtedness of the Company as of November 8, 2005 reflected on the
      Closing Balance Sheet, as finally agreed to by the parties or determined by
      the
      Independent Auditor under Section 2.8.

     

    Actual
      Net Working Capital
      - the
      amount of Net Working Capital of the Company as of November 8, 2005 as reflected
      on the Closing Balance Sheet, as finally agreed to by the parties or determined
      by the Independent Auditor under Section 2.8.

     

    Additional
      Gross-Up Amount
      - as
      defined in Section 2.7(e).

     

    Additional
      Payments
      - as
      defined in Section 3.27.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Affiliate
      - with
      respect to any Person, a Person that directly or indirectly, through one or
      more
      intermediaries, controls, is controlled by, or is under common control with,
      such Person.

     

    Alternate
      Procedure
      - as
      defined in Section 7.8.

     

    Applicable
      Contract
      - any
      Contract to which the Company is a party.

     

    Asserted
      Liability
      - as
      defined in Section 5.2.

     

    Bank
      -
      Atlantic Bank of New York.

     

    Basket
      - as
      defined in Section 5.1(a).

     

    Benefit
      Plan
      - any
      plan, agreement, arrangement or commitment (whether provided by insurance,
      self-insurance or otherwise) with respect to which the Company has, had, or
      could reasonably be expected to have, any liability, that is an employment,
      consulting or deferred compensation agreement; or an executive compensation,
      incentive, bonus, employee pension, profit-sharing, savings, retirement, stock
      option, stock purchase, or severance pay plan; or a life, health,
      post-retirement benefit, disability or accident plan; or a holiday, vacation,
      leave of absence, Christmas or other bonus practice; or expense reimbursement,
      automobile or other transportation allowance; or other employee benefit plan,
      agreement, arrangement or commitment, including, without limitation, any
“employee
      benefit plan,”
as
      defined in section 3(3) of ERISA.

     

    Breach
      - a
“Breach”
of
      a
      representation, warranty, covenant, obligation, or other provision of this
      Agreement, or any instrument delivered pursuant to this Agreement, will be
      deemed to have occurred if there is any inaccuracy in or breach of, or any
      failure to perform or comply with, in any respect, such representation,
      warranty, covenant, obligation or other provision.

     

    Buyer
      - as
      defined in the first paragraph of this Agreement.

     

    Buyer
      Indemnified Parties
      - as
      defined in Section 5.1(a).

     

    Cash
      - means
      all cash and cash related equivalents of the Company.

     

    Claims
      Notice
      - as
      defined in Section 5.2.

     

    Ceiling
      - as
      defined in Section 5.1(a).

     

    Closing
      - as
      defined in Section 2.3.

     

    Closing
      Balance Sheet
      - as
      defined in Section 2.8(a).

     

    Closing
      Date
      - the
      date and time as of which the Closing actually takes place.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Collateral
      Source
      - as
      defined in Section 5.6.

     

    Company
      - as
      defined in the Recitals of this Agreement.

     

    Competing
      Business
      - as
      defined in Section 3.26(b).

     

    Consent
      - any
      approval, consent, ratification, waiver, or other authorization from any Person
      other than a Governmental Body.

     

    Contemplated
      Transactions
      - all of
      the transactions contemplated by this Agreement, including:

     

    (a)  the
      sale
      of the Securities by Sellers to Buyer;

     

    (b)  the
      execution and delivery of the Transaction Documents; and

     

    (c)  the
      performance by Buyer and Sellers of their respective covenants and obligations
      under this Agreement.

     

    Contract
      - any
      agreement, contract, obligation, promise, or undertaking (whether written or
      oral) that is legally binding.

     

    Damages
      - as
      defined in Section 5.1(a).

     

    Designated
      Current Assets
      - the
      following current assets reflected on the Company’s financial statements: “net
      accounts receivables,” “inventory,” and “other current assets.”

     

    Designated
      Current Liabilities
      - the
      following current liabilities reflected on the Company’s financial statements:
“accounts payable trade,” “accrued expenses,” “notes payable premium financing,”
and “other current liabilities.”

     

    Disclosure
      Letter
      - the
      disclosure letter delivered by Sellers to Buyer concurrently with the execution
      and delivery of this Agreement.

     

    Employee
      Pension Benefit Plan
      - as
      defined in Section 3.15(a).

     

    Employee
      Welfare Benefit Plan
      - as
      defined in Section 3.15(a).

     

    Encumbrance
      - any
      charge, claim, community property interest, condition, equitable interest,
      lien,
      option, pledge, security interest, right of first refusal, or restriction of
      any
      kind.

     

    Environment
      - soil,
      land surface or subsurface strata, surface waters (including navigable waters,
      streams, ponds, drainage basins, and wetlands), groundwaters, ambient air
      (including indoor air) and plant and animal life.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Environmental,
      Health, And Safety Liabilities
      - any
      cost, damages, expense, liability or legal obligation arising from or under
      Environmental Law or Occupational Safety and Health Law and consisting
      of:

     

    (a)  fines,
      penalties, judgments, awards, settlements, orders, legal or administrative
      proceedings, notices, requests for information, damages, losses, claims, demands
      and response, investigative, remedial, or inspection costs and expenses arising
      under Environmental Law or Occupational Safety and Health Law;

     

    (b)  responsibility
      under Environmental Law or Occupational Safety and Health Law for cleanup costs
      or corrective action, including any investigation, cleanup, removal,
      containment, or other remediation or response actions required by applicable
      Environmental Law or Occupational Safety and Health Law (“Cleanup”),
      to
      the extent such Cleanup has been required or requested, or such responsibility
      has been noticed, by any Governmental Body or third party, and for any natural
      resource damages;

     

    (c)  any
      other
      compliance, corrective, investigative, or remedial measures required under
      Environmental Law or Occupational Safety and Health Law; or

     

    (d)  the
      presence of contamination on, under or above, or that has migrated onto any
      property adjacent to, any property currently or formerly owned by Sellers or
      the
      Company for which Cleanup is required.

     

    The
      terms
“removal,” “remedial,” and “response action,” include the types of activities
      covered by the United States Comprehensive Environmental Response, Compensation,
      and Liability Act, 42 U.S.C. Section 9601 et seq., as amended
      (“CERCLA”).

     

    Environmental
      Law
      - any
      applicable Legal Requirement that relates to (i) pollution, contamination,
      Cleanup or protection of the Environment; (ii) the manufacture, process,
      distribution, use, treatment, storage, disposal, transport, or handling of
      Hazardous Materials or (iii) any release, discharge, disposal or threatened
      release of Hazardous Materials.

     

    ERISA
      - the
      Employee Retirement Income Security Act of 1974 or any successor law, and
      regulations issued pursuant to that Act or any successor law.

     

    Estimated
      Cash
      - as
      defined in Section 2.7 and attached as Exhibit
      1-1.

     

    Estimated
      Indebtedness
      - as
      defined in Section 2.7 and attached as Exhibit
      1-1.

     

    Estimated
      Net Working Capital
      - as
      defined in Section 2.7 and attached as Exhibit
      1-1.

     

    Facilities
      - any
      real property leaseholds, or other real property interests currently or formerly
      owned or operated by the Company and any buildings, plants or structures
      currently or formerly owned or operated by the Company.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    FDA
      - The
      U.S. Food and Drug Administration, or any successor agency within the Department
      of Health and Human Services or independent thereof.

     

    Financial
      Statements
      - as
      defined in Section 3.4.

     

    Fixed
      Asset List
      - as
      defined in Section 3.6(b).

     

    GAAP
      -
      generally accepted United States accounting principles applied on a basis
      consistent with the Company’s past practices. 

     

    Governmental
      Authorization
      - any
      approval, consent, license, permit, registration, waiver, or other authorization
      issued, granted, given, or otherwise required by or under the authority of
      any
      Governmental Body or pursuant to any Legal Requirement.

     

    Governmental
      Body
      -
      any:

     

    (e)  federal,
      state, local, municipal, foreign, or other government; or

     

    (f)  governmental
      authority of any nature (including any governmental agency, branch, department,
      or entity and any court or other tribunal).

     

    Gross-Up
      Amount
      - as
      defined in Section 2.6.

     

    Hazardous
      Activity
      - the
      distribution, generation, handling, importing, management, manufacturing,
      processing, production, refinement, Release, storage, transfer, transportation,
      treatment, or use of Hazardous Materials in, on, under or from the
      Facilities.

     

    Hazardous
      Materials
      - any
      hazardous or toxic waste or other substance that is listed, defined, designated,
      or classified as, or otherwise determined to be, hazardous, radioactive, or
      toxic or a pollutant or a contaminant under or pursuant to any Environmental
      Law, which is regulated by any Environmental Law, including any admixture or
      solution thereof, and specifically including petroleum and all derivatives
      thereof or synthetic substitutes therefore and asbestos or asbestos-containing
      materials.

     

    Historical
      Statements
      - as
      defined in Section 3.4.

     

    Income
      Tax
      - (i)
      federal, state, local or foreign income taxes or other taxes measured by income,
      together with any interest, penalties or additions to tax imposed with respect
      thereto and (ii) any obligations under any agreements or arrangements with
      respect to any Income Taxes described in clause (i) above.

     

    Income
      Tax Return
      - any
      return, declaration, report, claim for refund or information return or statement
      relating to Income Taxes, including any schedule or attachment thereto, and
      including any amendment thereof.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Indebtedness
      - all
      indebtedness for borrowed money of the Company and any indebtedness for borrowed
      money guaranteed by the Company.

     

    Indemnitee
      - as
      defined in Section 5.2.

     

    Indemnitor
      - as
      defined in Section 5.2.

     

    Independent
      Accountants
      - as
      defined in Section 3.4.

     

    Independent
      Auditors
      - as
      defined in Section 2.8.

     

    Insurance
      Source
      - as
      defined in Section 5.6.

     

    Intellectual
      Property Assets
      - as
      defined in Section 3.24.

     

    Interim
      Balance Sheet
      - as
      defined in Section 3.4.

     

    Interim
      Balance Sheet Date
      - as
      defined in Section 3.7.

     

    Interim
      Statements
      - as
      defined in Section 3.4.

     

    IRC
      - the
      Internal Revenue Code of 1986, as amended, or any successor law, and regulations
      issued by the IRS pursuant to the Internal Revenue Code or any successor
      law.

     

    IRS
      - the
      United States Internal Revenue Service or any successor agency, and, to the
      extent relevant, the United States Department of the Treasury.

     

    Knowledge
      -
      Sellers will be deemed to have “Knowledge”
of
      a
      particular fact or other matter if any of the Persons listed on Exhibit
      1-2
      is
      actually aware (as opposed to any imputed knowledge) of such fact or other
      matter. Buyer will be deemed to have “Knowledge”
of
      a
      particular fact or matter if any of the Persons listed on Exhibit
      1-3
      is
      actually aware (as opposed to any imputed knowledge) of such fact or
      matter:

     

    Legal
      Requirement
      - any
      federal, state, local, municipal, foreign, international, multinational, or
      other administrative order, constitution, law, ordinance, principle of common
      law, rule, regulation, statute, or treaty.

     

    LLC
      Agreement
      - the
      Amended and Restated Limited Liability Company Agreement of Dental Concepts
      LLC,
      dated March 15, 2002, by and between the parties thereto.

     

    Marks
      - as
      defined in Section 3.24(a).

     

    Material
      Adverse Effect
      - any
      material adverse change in the business, operations, properties, assets, or
      condition of the Company, taken as a whole, other than (a) general economic
      conditions, (b) the announcement or consummation of the Contemplated
      Transactions, (c) the commencement of a proceeding in bankruptcy with respect
      to
      a Material Customer, (d) 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    any
      failure by the Company to meet any internal or published projections, forecasts,
      or revenue or earnings predictions for any period, (e) national or international
      political or social conditions, (f) war, outbreak of hostilities or terrorist
      attacks, (g) conditions affecting the financial, banking or securities markets
      (including any disruption thereof and any decline in the price of any security
      or any market index), (h) changes in any laws, rules or regulations of general
      application, and (i) any action taken by a party hereto in accordance with
      this
      Agreement.

     

    Material
      Applicable Contract
      - any
      Applicable Contract listed or required to be listed on Schedule
      3.19(a)
      of the
      Disclosure Letter, including any Applicable Contract which would have been
      required to be listed on Schedule
      3.19(a)
      of the
      Disclosure Letter but for the fact that it is listed on another Schedule of
      the
      Disclosure Letter.

     

    Material
      Customer
      - the
      customers of Company listed on Schedule
      3.19(a)(i)
      of the
      Disclosure Letter.

     

    Multiemployer
      Plan
      - as
      defined in Section 3.15(a).

     

    Net
      Working Capital
      - means
      an amount equal to the Designated Current Assets minus the Designated Current
      Liabilities.

     

    Non-Trade
      Accounts Payable
      - as
      defined in Section 3.9(c).

     

    Occupational
      Safety and Health Law
      - any
      Legal Requirement designed to provide safe and healthful working conditions
      and
      to reduce occupational safety and health hazards.

     

    Order
      - any
      injunction, judgment, order, or ruling entered, issued, made, or rendered by
      any
      Governmental Body or by any arbitrator against the Company that has a
      prospective effect.

     

    Organizational
      Documents
      - (a)
      the articles or certificate of incorporation and the bylaws of a corporation;
      (b) the certificate of formation and the operating agreement or like agreement
      of a limited liability company, (c) the partnership agreement and any statement
      of partnership of a general partnership; (d) the limited partnership agreement
      and the certificate of limited partnership of a limited partnership; (e) any
      charter or similar document adopted or filed in connection with the creation,
      formation, or organization of a Person; and (f) any amendment to any of the
      foregoing.

     

    Patents
      - as
      defined in Section 3.24(a).

     

    Pay
      Out Arrangements
      - the
      severance obligations set forth in Schedule
      3.27
      of the
      Disclosure Letter.

     

    Person
      - any
      individual, corporation (including any non-profit corporation), general or
      limited partnership, limited liability company, joint venture, estate, trust,
      association, organization, labor union, or other entity or Governmental
      Body.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Post-Closing
      Tax Period(s)
      - any
      taxable periods beginning after the Closing Date.

     

    Pre-Closing
      Tax Period(s)
      - any
      taxable period ending on or before the Closing Date.

     

    Previous
      Owners
      - the
      Persons who owned the NightGuardTM device prior to its purchase by the Company.

     

    Predecessor
      - as
      defined in Section 7.8.

     

    Product
      Liability Claim
      - any
      third party claim for property damages or personal injury based on “strict
      liability” theory which arises out of or is based upon any express or implied
      representation, warranty, agreement or guarantee made or alleged to have been
      made or which is imposed or asserted to be imposed by operation of law excluding
      any standard product warranty claims.

     

    Proceeding
      - any
      action, arbitration, audit, hearing, litigation, or suit (whether civil,
      criminal, administrative or investigative) commenced, brought, conducted, or
      heard by or before any Governmental Body or arbitrator.

     

    Products
      - the
      therapeutic and non-therapeutic oral care products marketed and distributed
      by
      the Company and sold in retail outlets throughout the United States of America
      and Canada in the ordinary course of business, consistent with past
      practice.

     

    Prohibited
      Transaction
      - as
      defined in Section 3.15(h).

     

    Purchase
      Price
      - as
      defined in Section 2.2.

     

    Regulatory
      Escrow Agreement
      - as
      defined in Section 2.4.

     

    Regulatory
      Escrow Amount
      - as
      defined in Section 2.3.

     

    Regulatory
      Escrowed Funds
      - as
      defined in Section 5.5.

     

    Related
      Person
      - with
      respect to a particular individual:

     

    (g)  each
      other member of such individual’s Family;

     

    (h)  any
      Person that is directly or indirectly controlled by such individual or one
      or
      more members of such individual’s Family;

     

    (i)  any
      Person in which such individual or members of such individual’s Family hold
      (individually or in the aggregate) a Material Interest; and

     

    (j)  any
      Person with respect to which such individual or one or more members of such
      individual’s Family serves as a director, officer, partner, executor, or trustee
      (or in a similar capacity).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    With
      respect to a specified Person other than an individual:

     

    (k)  any
      Person that directly or indirectly controls, is directly or indirectly
      controlled by, or is directly or indirectly under common control with such
      specified Person;

     

    (l)  any
      Person that holds a Material Interest in such specified Person;

     

    (m)  each
      Person that serves as a director, officer, partner, executor, or trustee of
      such
      specified Person (or in a similar capacity); and

     

    (n)  any
      Person with respect to which such specified Person serves as a general partner
      or a trustee (or in a similar capacity).

     

    For
      purposes of this definition, (a) the “Family”
of
      an
      individual includes (i) the individual, (ii) the individual’s spouse or domestic
      partner, and (iii) any other natural person who is a parent or child of the
      individual or the individual’s spouse that shares the same residence, and (b)
“Material
      Interest”
means
      direct or indirect beneficial ownership (as defined in Rule 13d-3 under the
      Securities Exchange Act of 1934) of voting securities or other voting interests
      representing at least 10% of the outstanding voting power of a Person or equity
      securities or other equity interests representing at least 10% of the
      outstanding equity securities or equity interests in a Person excluding any
      such
      ownership arising indirectly through ownership of mutual funds and similar
      investment vehicles.

     

    Release
      - any
      spilling, leaking, emitting, discharging, depositing, escaping, leaching,
      dumping, or other releasing into the Environment.

     

    Representative
      - with
      respect to a particular Person, any director, officer, manager, employee, agent,
      consultant, advisor, or other representative of such Person, including legal
      counsel, accountants, and financial advisors.

     

    Restricted
      Securities
      - as
      defined in Section 4.3.

     

    Royalty
      Payments
      - the
      amounts owed to the Previous Owners for the right to market and sell the
      NightGuardTM device pursuant to the Contingent Purchase Price provision under
      section 3 of that certain Asset Purchase Agreement, dated October 10, 1998,
      between Dental Concepts, Inc., Eugene Wagner, Peter Strauss (collectively
“Shareholders”) and Lesser & Roffe Associates, LLC.

     

    Securities
      - as
      defined in the Recitals of this Agreement.

     

    Securities
      Act
      - the
      Securities Act of 1933 or any successor law, and regulations and rules issued
      pursuant to that Act or any successor law.

     

    Securities
      Ownership Percentage
      - as
      defined in Section 2.9(c).

     

    Sellers
      - as
      defined in the first paragraph of this Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Sellers’
      Agent
      - as
      defined in Section 2.8(a).

     

    Sellers’
      Agent Reserve Fund
      - as
      defined in Section 2.10(g).

     

    Sellers’
      Indemnified Parties
      - as
      defined in Section 5.1(b).

     

    Sellers’
      Parties
      - as
      defined in Section 3.13.

     

    Sellers’
      Straddle Period Allocation
      - as
      defined in Section 7.4(b).

     

    Straddle
      Period(s)
      - all
      taxable periods or portions thereof beginning before and ending after the
      Closing Date.

     

    Subsidiary
      - with
      respect to any Person (the “Owner”),
      any
      corporation or other Person of which securities or other interests having the
      power to elect a majority of that corporation’s or other Person’s board of
      directors or similar governing body, or otherwise having the power to direct
      the
      business and policies of that corporation or other Person (other than securities
      or other interests having such power only upon the happening of a contingency
      that has not occurred) are held by the Owner or one or more of its
      Subsidiaries.

     

    Successor
      Employer
      - as
      defined in Section 7.8.

     

    Survival
      Period
      - as
      defined in Section 8.3.

     

    Taxes
      - (a)
      any and all Income Taxes and all other taxes, including, without limitation,
      income, gross receipts, excise, tariff, value-added, net worth, duties,
      property, sales, withholding, social security, occupation, use, service,
      license, payroll, franchise, transfer and recording taxes, fees and charges,
      windfall profits, severance, customs, import, export, employment or similar
      taxes, charges, fees, levies or other assessments imposed by the United States,
      or any state, local or foreign government or subdivision or agency thereof,
      (regardless of whether they are computed on a separate, consolidated, unitary,
      combined or any other basis) together with all interest, penalties, deficiencies
      and additions imposed with respect to such amounts, (b) any liability for the
      payment of any amount described in section (a) of this definition as a result
      of
      being a member of an affiliated, consolidated, combined or unitary group for
      any
      period and (c) any obligations under any agreements or arrangements with any
      other Person with respect to amounts described in sections (a) and (b) of this
      definition (including any liability for such amounts of a predecessor
      entity).

     

    Tax
      Return
      - any
      return (including any information return), report, declaration, document,
      filing, statement, schedule, notice, form, or other document or information
      (whether consolidated, combined or otherwise) filed with or submitted to, or
      required to be filed with or submitted to, any Governmental Body in connection
      with the determination, assessment, collection, or payment of any Tax or in
      connection with the administration, implementation, or enforcement of or
      compliance with any Legal Requirement relating to any Tax.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    Third
      Party Source
      - as
      defined in Section 5.6.

     

    Threat
      Of Release
      - a
      substantial likelihood of a Release that may require action under Environmental
      Law in order to prevent or mitigate damage to the Environment that may result
      from such Release.

     

    Threatened
      - a
      claim, Proceeding, dispute, action, or other matter will be deemed to have
      been
“Threatened”
if
      any
      demand or statement has been made or any written notice has been given that
      such
      a claim, Proceeding, dispute, action, or other matter is likely to be asserted,
      commenced, taken, or otherwise pursued in the future.

     

    Trade
      Secrets
      - as
      defined in Section 3.24(a).

     

    Traditional
      Escrow Agreement
      - as
      defined in Section 2.4.

     

    Traditional
      Escrow Amount
      - as
      defined in Section 2.3.

     

    Traditional
      Escrowed Funds
      - as
      defined in Section 5.4.

     

    Transaction
      Documents
      - the
      agreements, documents and instruments identified in Section 2.4.

     

    2.  SALE
      AND TRANSFER OF SECURITIES; CLOSING

     

    2.1  Securities.
      Subject
      to the terms and conditions of this Agreement, at the Closing, Sellers will
      sell
      and transfer the Securities to Buyer, and Buyer will purchase the Securities
      from Sellers.

     

    2.2  Purchase
      Price.
      Subject
      to adjustment as set forth in this Article 2, the aggregate purchase price
      for
      the Securities shall be an amount equal to (i) $30,188,000, minus (ii) Estimated
      Indebtedness (as defined below), plus (iii) the Gross-Up Amount (as defined
      below), minus (iv) the amount of the Sellers’ Agent Reserve Fund. The result of
      the calculation in the preceding sentence shall be increased by the amount,
      if
      any, by which the Estimated Cash exceeds $200,000 or decreased by the amount,
      if
      any, by which $200,000 exceeds the Estimated Cash (such purchase price, as
      so
      increased or decreased, the “Estimated
      Purchase Price”).
      

     

    2.3  Closing.
      The
      parties intend that the purchase and sale provided for in this Agreement (the
      “Closing”)
      will
      take place simultaneously with the execution and delivery of this Agreement
      at
      the offices of Dechert LLP, 30 Rockefeller Plaza, New York, NY 10112, on the
      date hereof. Accordingly, except as otherwise provided herein, all references
      herein to the Closing shall mean and include the closing of the Contemplated
      Transactions on the date hereof. The Closing shall be effective as of the open
      of business on the Closing Date.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    2.4  Closing
      Deliveries.
      At the
      Closing:

     

    (a)  Sellers
      will deliver to Buyer instruments of transfer, duly signed by Sellers, conveying
      the Securities to Buyer; and

     

    (b)  Sellers
      will deliver to Buyer a consent from the landlord for a change of control
      pursuant to the lease agreement between Mack-Cali Realty, L.P. and Dental
      Concepts LLC dated December 6, 1999, as amended.

     

    (c)  Buyer
      shall (i) deliver to Bank of New York, as escrow agent (the “Escrow
      Agent”),
      $1,500,000 of the Estimated Purchase Price (the “Traditional
      Escrow Amount”)
      pursuant to the Traditional Escrow Agreement, dated as of the date hereof (the
      “Traditional
      Escrow Agreement”),
      between Buyer and the Sellers’ Agent, (ii) deliver to Escrow Agent $1,500,000 of
      the Estimated Purchase Price (the “Regulatory
      Escrow Amount”)
      pursuant to the Regulatory Escrow Agreement, dated as of the date hereof (the
      “Regulatory
      Escrow Agreement”),
      between Buyer and the Sellers’ Agent, (iii) deliver $50,000 to the Seller’s
      Agent in respect of the Sellers’ Agent Reserve Fund as contemplated by Section
      2.10(g), and (iv) pay the remaining portion of the Estimated Purchase Price
      to
      Sellers by wire transfer of immediately available funds payable to a single
      account as designated by the Sellers’ Agent. In addition, Buyer will deliver to
      the Bank an amount equal to the Estimated Indebtedness (as defined below) as
      payment in full of all amounts owed thereunder. Delivery of all the amounts
      referred to above shall be in cash by wire transfer of immediately available
      funds to the single account designated by the Sellers’ Agent (or, in the case of
      the Traditional Escrow Amount or the Regulatory Escrow Amount, the escrow agent,
      and, in the case of the payment for Estimated Indebtedness, to the account
      designated by the Bank).

     

    2.5  Allocation.
      Buyer
      and Sellers acknowledge that the purchase and sale of the Securities hereunder
      shall be treated, in accordance with Rev. Rul. 99-6, as a purchase of assets
      by
      Buyer and as a sale of partnership interests by Sellers for federal income
      Tax
      purposes. Buyer and Sellers agree that the Estimated Purchase Price shall be
      allocated for purposes of Buyer’s deemed purchase of assets among the assets of
      the Company in accordance with an allocation which the parties shall cooperate
      in good faith to prepare following the Closing. If the parties cannot agree
      on
      the allocation with in ninety (90) days of the Closing, any disputes will be
      submitted to the Independent Auditor, who shall conclusively resolve such
      disputes in accordance with Section 1060 of the Code within thirty (30) days
      thereof. Each of the parties hereto agrees to report the transactions described
      herein consistently with such allocation for all Tax purposes. Each of the
      parties shall utilize such allocations for all Tax reporting purposes and shall
      defend any examination or audit relating thereto in a manner consistent with
      such allocation. Each party shall update such allocation to reflect any
      Post-Closing adjustments to the Estimated Purchase Price.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    2.6  Gross-Up.
       Buyer
      agrees that at the Closing, it will pay to Sellers $100,000 (the "Gross-Up
      Amount")
      with
      the intent of causing the net proceeds received by Sellers (including the
      Gross-Up Amount, after payment of all applicable Taxes, assuming for these
      purposes that Sellers have no items of income or deduction other than the
      Estimated Purchase Price, as adjusted pursuant to this Article 2, but taking
      into account all recapture of “unrealized
      receivables”
as
      defined in Section 751 of the Code, and all similar items, as actually
      incurred), to equal an amount that the Sellers would have received after the
      payment of all applicable Taxes if such Taxes had only been payable at capital
      gains rates.

     

    2.7  Estimates;
      Adjustments.

     

    (a)  The
      Company has estimated Net Working Capital (“Estimated
      Net Working Capital”),
      Cash
      (“Estimated
      Cash”)
      and
      Indebtedness (“Estimated
      Indebtedness”)
      as of
      November 8, 2005 and delivered to Buyer a statement attached as Exhibit
      1-1.

     

    (b)  If
      Actual
      Net Working Capital, as finally determined pursuant to Section 2.8(b), is
      less than the Estimated Net Working Capital, then the Estimated Purchase Price
      shall be reduced dollar-for-dollar by the amount of such shortfall, and Sellers
      shall pay Buyer the amount of such reduction. If Actual Net Working Capital,
      as
      finally determined pursuant to Section 2.8(b), is greater than the
      Estimated Net Working Capital, then the Estimated Purchase Price shall be
      increased dollar-for-dollar by the amount of such excess, and Buyer shall pay
      Sellers the amount of such increase.

     

    (c)  If
      Actual
      Cash, as finally determined pursuant to Section 2.8(b), is less than
      Estimated Cash, then the Estimated Purchase Price shall be reduced
      dollar-for-dollar by the amount of such shortfall, and Sellers shall pay Buyer
      the amount of such reduction. If Actual Cash, as finally determined pursuant
      to
      Section 2.8(b), is greater than Estimated Cash, then the Estimated Purchase
      Price shall be increased dollar-for-dollar by the amount of such excess, and
      Buyer shall pay Sellers the amount of such increase.

     

    (d)  If
      Actual
      Indebtedness, as finally determined pursuant to Section 2.8(b), is greater
      than the Estimated Indebtedness, then the Estimated Purchase Price shall be
      reduced dollar-for-dollar by the amount of such shortfall, and Sellers shall
      pay
      Buyer the amount of such reduction. If Actual Indebtedness, as finally
      determined pursuant to Section 2.8(b), is less than the Estimated
      Indebtedness, then the Estimated Purchase Price shall be increased
      dollar-for-dollar by the amount of such excess, and Buyer shall pay Sellers
      the
      amount of such increase. 

     

    (e)  If,
      after
      finalization of the allocation of the Estimated Purchase Price contemplated
      by
      Section 2.5 hereof, the Gross-Up Amount is not sufficient to cause the net
      proceeds received by Sellers (including the Gross-Up Amount, after payment
      of
      all applicable 

     

    (f)  Taxes,
      assuming for these purposes that Sellers have no items of income or deduction
      other than the Estimated Purchase Price, as adjusted pursuant to this Article
      2,
      but taking into account all recapture of “unrealized
      receivables”
as
      defined in Section 751 of the Code, and all similar items, as actually
      incurred), to equal an amount that the Sellers would have received after the
      payment of all applicable Taxes if such Taxes had only been payable at capital
      gains rates, then the Estimated Purchase Price shall be increased by such amount
      (the “Additional
      Gross-Up Amount”)
      as is
      sufficient to cause the net proceeds received by Sellers (including the Gross-Up
      Amount and such Additional Gross-Up Amount, after payment of all applicable
      Taxes, assuming for these purposes that Sellers have no items of income or
      deduction other than the Estimated Purchase Price, as adjusted pursuant to
      this
      Article 2, but taking into account all recapture of “unrealized
      receivables”
as
      defined in Section 751 of the Code, and all similar items, as actually
      incurred), to equal an amount that the Sellers would have received after the
      payment of all applicable Taxes if such Taxes had only been payable at capital
      gains rates, and Buyer shall pay Sellers the amount of such
      increase.

     

    (g)  Any
      payment required to be made under this Section 2.7 shall be made no later
      than two (2) Business Days after the final determination of Actual Net Working
      Capital, Actual Cash and Actual Indebtedness pursuant to Section 2.8;
provided,
      however,
      that if
      the purchase price allocation contemplated by Section 2.5 has not been finalized
      as of such time, the payment required by Section 2.7(e) shall be made at such
      time as such allocation is finalized.

     

    2.8  Closing
      Balance Sheet.
      

     

    (a)  No
      later
      than ninety (90) days after the Closing Date, Buyer shall (i) prepare or cause
      to be prepared a balance sheet of the Company as of the close of business on
      November 8, 2005 (the “Closing
      Balance Sheet”)
      as
      well as a calculation, based on the Closing Balance Sheet, of Actual Net Working
      Capital, Actual Indebtedness and Actual Cash, and (ii) deliver to Sellers’ Agent
      the Closing Balance Sheet, as well as the calculation of Actual Net Working
      Capital, Actual Indebtedness, Actual Cash and the adjustments, if any, required
      to be made to the Estimated Purchase Price pursuant to Section 2.7 (the
“Schedule
      of Adjustments”).
      The
      Closing Balance Sheet shall be prepared in conformity with, and using the same
      accounting principles and methodologies as the Historical
      Statements.

     

    (b)  Sellers’
      Agent will have a period of thirty (30) days following the delivery of the
      Closing Balance Sheet and the Schedule of Adjustments to notify Buyer of any
      disagreements with the Closing Balance Sheet or the Schedule of Adjustments,
      it
      being understood that Sellers’ Agent may object to the calculations reflected
      therein, but only on the basis that such calculations were not made in
      accordance with this Agreement. Any such notice shall be accompanied by
      supporting documentation containing reasonable detail. Failure to notify Buyer
      within such 30-day period shall be deemed acceptance of the Closing Balance
      Sheet and the Schedule of Adjustments. In the event Sellers’ Agent timely notify
      Buyer of any disagreement, Buyer and Sellers’ Agent will attempt in good faith
      to resolve such disagreement. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    If
      within
      thirty (30) days after delivery to Buyer of the notification by Sellers’ Agent
      of a disagreement, they are unable to resolve such disagreement, either Buyer,
      on the one hand, or Sellers’ Agent, on the other hand, shall have the right to
      submit the determination of such matter to an independent accountant of national
      standing reasonably acceptable to Buyer and Sellers’ Agent (the “Independent
      Auditor”),
      whose
      decision shall be binding on the parties. The Independent Accountant shall
      be
      acting as an arbitrator and not as an auditor and shall decide only those issues
      as to which the parties are not in agreement on the grounds that the Closing
      Date Balance Sheet and/or the Schedule of Adjustment delivered by the Company
      pursuant to Section 2.8(a) was not prepared conformity with principles used
      in
      the preparation of the Historical Statements or contained computational errors.
      The cost of the Independent Auditor shall be paid by the party whose aggregate
      estimate of the disputed amount or amounts, as the case may be, differs most
      greatly from the determination of the Independent Auditor. Notwithstanding
      anything herein to the contrary, the dispute resolution mechanism contained
      in
      this Section 2.8 shall be the exclusive mechanism for resolving disputes
      regarding all adjustments, if any, pursuant to Section 2.8.

     

    (c)  Buyer
      shall provide Sellers’ Agent and its accountants with reasonable access to all
      books and records and working papers and to personnel of Buyer and the Company
      to the extent necessary to enable Sellers’ Agent and its accountants to review
      the preparation of the Closing Balance Sheet and the Schedule of Adjustments,
      subject to Sellers’ Agent and its accountants executing standard confidentiality
      agreements.

     

    2.9  Sellers’
      Agent.
      

     

    (a)  By
      the
      execution and delivery of this Agreement, each Seller irrevocably appoints
      and
      authorizes Hamilton Investment Partners, LLC, to act as such Seller’s agent,
      representative and attorney-in-fact hereunder (in such capacity and not in
      its
      personal capacity as a Seller, the “Sellers’
      Agent”).
      Each
      Seller irrevocably authorizes the Sellers’ Agent to take such action on behalf
      of such Seller and to exercise all such powers as are expressly delegated to
      the
      Sellers’ Agent hereunder, together with such other powers as are reasonably
      incidental thereto, including the execution and delivery of the Traditional
      Escrow Agreement and Regulatory Escrow Agreement, certificates, statements,
      notices, approvals, extensions, waivers, undertakings and amendments to this
      Agreement or the Traditional and Regulatory Escrow Agreements required or
      permitted to be made, given or determined hereunder or in connection with the
      transactions contemplated hereby, and including the right to contest and settle
      any claims for indemnification, adjustments to purchase price or other claims
      made hereunder and to resolve any other disputes arising under this Agreement
      or
      the Traditional and Regulatory Escrow Agreements. The Sellers’ Agent shall have
      the right and authority to engage and employ agents and representatives and
      to
      incur expenses as the Sellers’ Agent reasonably deems necessary or prudent in
      connection with the foregoing. The Sellers’ Agent shall have the sole and
      exclusive right on behalf of any Seller to take any action, or receive any
      notice of any claims for indemnification under Article 5 hereof and to settle
      any claim or controversy arising with respect thereto; provided,
      however,
      the
      Sellers’ Agent shall not settle any claim against a 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    single
      Seller without the consent of such Seller. Any actions taken or omitted,
      exercises of rights, power or authority, and any decision or determination
      made
      by the Sellers’ Agent shall be absolutely and irrevocably binding on each Seller
      as if such Seller had personally taken such action or omitted to take such
      action, exercised such rights, power or authority or made such decision or
      determination in such Seller’s individual capacity, and no Seller shall have the
      right to object, dissent, protest or otherwise contest the same. Buyer’s rights
      and remedies against the Sellers shall in no way be diminished because the
      right
      or remedy was due to the acts or omissions of the Sellers’ Agent.

     

    (b)  The
      appointment of the Sellers’ Agent as each Seller’s attorney-in-fact revokes any
      power of attorney heretofore granted that authorized any other person or persons
      to represent such Seller with regard to this Agreement or the Traditional and
      Regulatory Escrow Agreements. The appointment of the Sellers’ Agent as
      attorney-in-fact pursuant hereto is coupled with an interest and is irrevocable.
      The obligations of each Seller pursuant to this Agreement (i) will not be
      terminated by operation of law, death, mental or physical incapacity,
      liquidation, dissolution, bankruptcy, insolvency or similar event with respect
      to such Seller or any proceeding in connection therewith, or in the case of
      a
      trust, by the death of any trustee or trustees or the termination of such trust,
      or any other event, and (ii) shall survive the delivery of an assignment by
      any
      Seller of the whole or any fraction of its interest in any payment due to it
      under this Agreement. 

     

    (c)  The
      Sellers’ Agent hereby accepts the foregoing appointment and agrees to serve as
      Sellers’ Agent, subject to the provisions hereof, for the period of time from
      and after the date hereof without compensation; provided that the Sellers (on
      the basis of their respective number of Units owned (the “Securities
      Ownership Percentage”))
      shall
      reimburse the Sellers’ Agent for expenses incurred by Sellers’ Agent in its
      capacity as such. Each of the Sellers hereby acknowledges and agrees, that
      in
      appointing Sellers’ Agent as its representative pursuant to the terms and
      provisions of this Section 2.9, and as specified herein, the Sellers’ Agent
      shall not, in the absence of bad faith, willful misconduct or gross negligence,
      have any liability to the Sellers whatsoever with respect to its actions,
      decisions and determinations, and the Sellers’ Agent and the Buyer shall be
      entitled to assume that all actions, decisions and determinations are fully
      authorized by each and every one of the Sellers. Each Seller shall indemnify
      the
      Sellers’ Agent against all damages, liabilities, claims, obligations, costs and
      expenses arising out of or in connection with any claim relating to the acts
      or
      omissions of the Sellers’ Agent hereunder, other than those that arise from the
      Sellers’ Agent’s bad faith, willful misconduct or gross negligence.

     

    (d)  The
      Sellers’ Agent shall be entitled to rely upon any order, judgment,
      certification, demand, notice, instrument or other writing delivered to it
      by a
      Seller hereunder without being required to determine the authenticity or the
      correctness of any fact stated therein or the propriety or validity of the
      service thereof. The Sellers’ Agent may act in reliance upon any instrument or
      signature of any Seller believed by it to be genuine and may assume that the
      Seller or representative thereof purporting to give receipt or advice or make
      any statement or execute any document in connection with the provisions hereof
      has been duly authorized to do 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    so.
      The
      Sellers’ Agent may conclusively presume that the undersigned representative of
      any party hereto which is not a natural person has full power and authority
      to
      instruct the Sellers’ Agent on behalf of that party unless written notice to the
      contrary is delivered to the Sellers’ Agent.

     

    (e)  The
      Sellers’ Agent may act pursuant to the advice of counsel with respect to any
      matter relating to this Agreement and shall not be liable to the Sellers for
      any
      action taken or omitted by it in good faith in accordance with such
      advice.

     

    (f)  The
      Buyer
      hereby agrees that the Sellers’ Agent shall not, in its capacity as such, have
      any liability or obligation under this Agreement to the Buyer whatsoever with
      respect to its actions, decisions or determinations, but rather Buyer shall
      have
      redress directly against Sellers for any actions, decisions, or determinations
      made by Sellers’ Agent; provided,
      however,
      nothing
      in this Agreement shall be deemed to be a release of the Sellers’ Agent with
      respect to any tortious act committed by the Sellers’ Agent against the Buyer;
provided,
      further,
      however,
      that
      nothing in this Agreement shall be deemed to limit or restrict the Sellers’
Agent from exercising its rights or remedies under this Agreement.

     

    (g)  The
      Sellers authorize the Sellers’ Agent to receive and hold back from the proceeds
      otherwise payable to the Sellers hereunder an amount equal to $50,000 (the
      “Sellers’
      Agent Reserve Fund”).
      The
      Sellers’ Agent Reserve Fund may be used by the Sellers’ Agent to pay transaction
      expenses, attorneys fees relating to disputes or negotiations arising out of
      this Agreement, year-end K-1 preparation accounting fees and other expenses
      relating to performance of its duties hereunder, including expenses associated
      with preparation of taxes. If upon the date two years after the date hereof,
      there remains any unused portion of the Seller’ Agent Reserve Fund, Sellers’
Agent shall pay such remaining amount to the Sellers in accordance with the
      ownership percentages set forth opposite each Seller’s name on Schedule
      3.1(a)
      attached
      hereto.

     

    3.  REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY

     

    Except
      as
      set forth in this Agreement or in the Disclosure Letter, the Company represents
      and warrants to Buyer as follows as of the effective time of the Closing. The
      following representations and warranties are qualified by the information set
      forth in this Agreement to the extent it is reasonably clear from such
      information that it qualifies the particular representation and warranty.
      Information in each Schedule of the Disclosure Letter qualifies the
      representations and warranties to which such Schedule relates (or makes
      cross-reference), as well as other representations and warranties in this
      Agreement to the extent it is reasonably clear from such information that it
      qualifies such other representations and warranties. Certain information
      reflected in the Disclosure Letter may not be matters required by this Agreement
      to be disclosed and such disclosure does not imply that such information is
      material (or set any standard of materiality) or that such information is
      responsive to the representations or warranties.

     

    3.1  Organization
      and Good Standing.

     

    (a)  Schedule
      3.1(a)
      of the
      Disclosure Letter contains a complete and accurate list for the Company of
      its
      jurisdiction of formation, other jurisdictions in which it is authorized to
      do
      business, and the identity of each equity holder and the number of securities
      held by each. The Company is a limited liability company duly organized, validly
      existing, and in good standing under the laws of its jurisdiction of
      organization, with requisite power and authority to conduct its business as
      it
      is now being conducted, to own or use the properties and assets that it purports
      to own or use, and to perform all its obligations under Applicable Contracts.
      The Company is duly qualified to do business as a foreign business entity and
      is
      in good standing under the laws of each state or other jurisdiction in which
      either the ownership or use of the properties owned or used by it, or the nature
      of the activities conducted by it, requires such qualification, except where
      the
      failure to be so qualified would not have a Material Adverse
      Effect.

     

    (b)  Sellers
      have delivered, or have caused to be delivered, to Buyer copies of the
      Organizational Documents of the Company, as currently in effect.

     

    3.2  Authority;
      No Conflict.

     

    (a)  This
      Agreement and the Contemplated Transactions have been duly authorized by
      Sellers, including all necessary actions by the Company’s managers and each of
      the members of the Company. Assuming the due execution and delivery of this
      Agreement by Buyer, this Agreement constitutes the legal, valid, and binding
      obligation of Sellers, enforceable against Sellers in accordance with its terms,
      except to the extent enforceability may be limited by bankruptcy, insolvency,
      reorganization, moratorium or other similar laws affecting the enforcement
      of
      creditors’ rights in general and subject to general principles of equity and the
      discretion of courts in granting equitable remedies. Upon the execution and
      delivery by Sellers of the Transaction Documents to which Sellers are a party,
      and assuming the due execution and delivery of such Transaction Documents by
      the
      other parties thereto, such Transaction Documents will constitute the legal,
      valid, and binding obligations of Sellers, enforceable against Sellers in
      accordance with their respective terms, except to the extent enforceability
      may
      be limited by bankruptcy, insolvency, reorganization, moratorium or other
      similar laws affecting the enforcement of creditors’ rights in general and
      subject to general principles of equity and the discretion of courts in granting
      equitable remedies. Any Seller that is not an individual has the requisite
      authority to execute and deliver this Agreement and the Transaction Documents
      to
      which it will be a party and to perform its obligations under this Agreement
      and
      the Transaction Documents to which it will be a party. Any Seller that is an
      individual has the legal capacity to execute and deliver this Agreement and
      the
      Transaction Documents to which it will be a party and to perform its obligations
      under this Agreement and the Transaction Documents to which it will be a
      party.

     

    (b)  Except
      as
      set forth in Schedule
      3.2(b)
      of the
      Disclosure Letter, neither the execution and delivery of this Agreement nor
      the
      consummation or performance of any of the Contemplated Transactions will (with
      or without notice or lapse of time):

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    (i)  contravene,
      conflict with, or result in a violation of any provision of the Organizational
      Documents of the Company or, to the Company’s Knowledge, any resolution adopted
      by the Company’s members and managers; or

     

    (ii)  contravene,
      conflict with, or result in a violation of any of the terms or requirements
      of,
      or give any Governmental Body the right to revoke, withdraw, suspend, cancel,
      terminate, or modify, any Governmental Authorization that is held by the
      Company.

     

    (c)  Except
      as
      set forth in Schedule
      3.2(c)
      of the
      Disclosure Letter, neither the execution and delivery of this Agreement nor
      the
      consummation or performance of the transaction described in clause (a) of the
      definition of Contemplated Transactions will (with or without notice or lapse
      of
      time) contravene, conflict with, or result in a violation of, any Legal
      Requirement or any Order to which the Company or any Seller is a party, or
      to
      which any of the assets owned or used by the Company is subject.

     

    3.3  Capitalization.

     

    (a)  Sellers
      are the record and beneficial owners and holders of all the issued and
      outstanding limited liability company membership interests of the Company,
      which
      constitute the Securities, free and clear of all Encumbrances other than
      restrictions on disposition contained in any applicable federal or state
      securities laws and other than any restriction or Encumbrances arising under
      the
      Company’s LLC Agreement. No legend or other reference to any purported
      Encumbrance appears upon any certificate representing equity securities of
      the
      Company. All of the outstanding equity securities of the Company have been
      duly
      authorized and validly issued. There are no Contracts relating to the issuance,
      sale, or transfer of any equity securities or other securities of the Company.
      None of the outstanding equity securities or other securities of the Company
      was
      issued in violation of the Securities Act or any other Legal
      Requirement.

     

    (b)  Other
      than as set forth in the LLC Agreement, the Company does not own, or have any
      Contract to acquire, any equity securities or other securities of any Person
      or
      any direct or indirect equity or ownership interest in any other
      business.

     

    3.4  Financial
      Statements.
      Sellers
      have delivered to Buyer: (a) audited balance sheet of the Company as of December
      31 in each of the years 2002 through 2004, and the related audited statements
      of
      income, changes in members’ deficiency, and cash flow for each of the fiscal
      years then ended, including in each case the notes thereto (collectively, the
      “Historical
      Statements”),
      together with the report thereon of Price Waterhouse Coopers LLP, independent
      certified public accountants (the “Independent
      Accountants”),
      and
      (b) an unaudited balance sheet of the Company as at June 30, 2005 (the
“Interim
      Balance Sheet”)
      and

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    the
      related unaudited statement of income (collectively with the Interim Balance
      Sheet, the “Interim
      Statements”).
      The
      Historical Statements, together with the notes thereto, and the Interim
      Statements (collectively, the “Financial
      Statements”)
      fairly
      present, in all material respects, the financial condition and the results
      of
      operations, changes in members’ deficiency, and cash flow of the Company as at
      the respective dates of and for the periods referred to in such Financial
      Statements, all in accordance with GAAP, subject, in the case of the Interim
      Statements, to recurring quarter-end and year-end adjustments, the absence
      of
      notes (that, if presented, would not differ materially in methodology from
      that
      applied in developing those included in the balance sheets referred to in clause
      (a) above); and, except as set forth in Schedule
      3.4
      of the
      Disclosure Letter, the Historical Financial Statements reflect the consistent
      application of such accounting principles throughout the periods
      involved.

     

    3.5  Books
      and Records.
      The
      books of account of the Company, all of which have been made available to Buyer,
      have been maintained in the ordinary course of business. At the Closing, all
      of
      those books and records will be in the possession of the Company.

     

    3.6  Title
      to Properties; Encumbrances.

     

    (a)  The
      Company does not own any real property. Schedule
      3.6(a)
      of the
      Disclosure Letter contains a complete and accurate list of all leaseholds or
      other interests in real property owned by the Company.

     

    (b)  At
      or
      prior to the Closing, Sellers shall provide to Buyer a complete and accurate
      written list of the Company’s material Fixed Assets (the “Fixed
      Asset List”).
      Except as set forth on Schedule
      3.6(b)
      of the
      Disclosure Letter, the Company owns (i) all of the Fixed Assets reflected on
      the
      Fixed Asset List other than tangible property sold, disposed of or consumed
      since the date of the Fixed Asset List, in the ordinary course of business,
      consistent with past practice, and (ii) all of the Fixed Assets purchased or
      otherwise acquired by the Company since the date of the Fixed Asset List (except
      for tangible property acquired and sold, disposed of or consumed since the
      date
      of the Fixed Asset List in the ordinary course of business, consistent with
      past
      practice), which subsequently purchased or acquired Fixed Assets (other than
      inventory, supplies, disposables, consumables and other properties and assets
      purchased or otherwise acquired in the ordinary course of business) are listed
      in Schedule
      3.6(b)
      of the
      Disclosure Letter. All properties and assets reflected in the Fixed Asset List
      or in Schedule
      3.6(b)
      are free
      and clear of all Encumbrances other than, with respect to all such properties
      and assets, (A) security interests shown on the Interim Balance Sheet as
      securing specified liabilities or obligations, with respect to which no default
      (or event that, with notice or lapse of time or both, would constitute a
      default) exists, (B) security interests incurred in connection with the purchase
      of property or assets after the date of the Interim Balance Sheet (security
      interests being limited to the property or assets so acquired), with respect
      to
      which no default (or event that, with notice or lapse of time or both, would
      constitute a default) exists, (C) statutory liens for current taxes or
      assessments not yet due or payable, (D) Encumbrances in 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    favor
      of
      lessors of equipment, (E) mechanic’s liens or other Encumbrances arising in the
      ordinary course of business which are immaterial to the value, financial
      condition or operations of the Company, and (F) Encumbrances identified on
      Schedule
      3.6(b)
      of the
      Disclosure Letter.

     

    3.7  Adequacy
      of Reserve for Returns.
      The
      reserve for returns of Products distributed by the Company prior to the Closing
      Date on the Interim Balance Sheet was materially adequate to account for the
      actual returns of such Products which were returnable as of the date of the
      Interim Balance Sheet (the “Interim
      Balance Sheet Date”)
      other
      than any abnormal returns attributable to the occurrence of either of the
      following: (a) a customer ceasing to doing business with the Company after
      the
      Interim Balance Sheet Date so long as the Company had no Knowledge prior to
      the
      Interim Balance Sheet Date that such customer intended to cease doing business
      with the Company after the Interim Balance Sheet Date, or (b) the commencement
      of a proceeding in bankruptcy more than 45 days following the Interim Balance
      Sheet Date with respect to a customer.

     

    3.8  Condition
      and Sufficiency of Assets.
      Except
      as disclosed in Schedule
      3.8,
      the
      equipment of the Company is sufficient for the operation of the business of
      the
      Company as it is currently conducted by the Company. The Company’s distribution
      centers were operating in the ordinary course of business as of the last date
      prior to the Closing Date that such distribution centers conducted
      operations.

     

    3.9  Accounts
      Receivable and Payable.

     

    (a)  All
      accounts receivable of the Company that reflected on the Interim Balance Sheet
      (collectively, the “Accounts
      Receivable”)
      represented valid obligations arising from sales actually made or services
      actually performed in the ordinary course of business. Subject
      to the reserves shown on the Closing Balance Sheet (which reserves will be
      calculated consistent with past practice), each of the Accounts Receivable
      not
      heretofore collected or written off will be collected, in cash or by credit
      during the Survival Period except for (i) Accounts Receivable of a customer
      that
      following the Closing Date ceases doing business with the Company, so long
      as
      the Company had no Knowledge prior to the Closing Date that such customer
      intended to cease doing business with the Company after the Closing Date, and
      (ii) Accounts Receivable payable by a customer that is the subject of a
      bankruptcy proceeding commenced more than 90 days following the Closing Date.
      There will be no contest, claim, or right of set-off, other than returns,
      shortages and other claims made in the ordinary course of business, under any
      Applicable Contract with any obligor of an Accounts Receivable relating to
      the
      amount or validity of such Accounts Receivable, except to the extent of the
      reserves shown on the Closing Balance Sheet or as disclosed in Schedule
      3.9(a)
      of the
      Disclosure Letter. Schedule
      3.9(a)
      of the
      Disclosure Letter contains a complete and accurate list, in all material
      respects, of all accounts receivable of the Company as of September 30, 2005,
      which list sets forth the aging of such accounts receivable.

     

    (b)  Schedule
      3.9(b)
      of the
      Disclosure Letter sets forth a correct and complete list of all outstanding
      trade accounts payable of the Company as of September 30, 2005, other

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    than
      individual accounts payable of not more than $50,000 (“Trade
      Accounts Payable”).
      Schedule
      3.9(b)
      also
      identifies all trade payables of the Company the payment of which is overdue
      (based on a due date consistent with the Company’s past practice for that
      creditor) by more than 120 days as of September 30, 2005, and all trade payables
      of the Company as to which, to the Company’s Knowledge, the applicable trade
      creditor has taken collection action at any time since June 30,
      2005.

     

    (c)  Schedule
      3.9(c)
      of the
      Disclosure Letter sets forth a correct and complete list of all material
      outstanding non-trade accounts payable of the Company as of September 30, 2005
      (“Non-Trade
      Accounts Payable”
and,
      together with Trade Accounts Payable, “Accounts
      Payable”).
      Schedule
      3.9(c)
      also
      identifies all non-trade accounts payable of the Company the payment of which
      is
      overdue (based on a due date consistent with the Company’s past practice for
      that creditor) by more than 120 days as of September 30, 2005, and all non-trade
      payables of the Company as to which, to the Company’s Knowledge, the applicable
      non-trade creditor has taken collection action at any time since June 30,
      2005.

     

    3.10  [Delete.]

     

    3.11  Inventory.

     

    (a)  The
      value
      of the inventory consisting of the NightGuardTM device and the Brushpick device
      reflected on the Closing Balance Sheet (determined in accordance with the
      valuation methodologies described in Section 3.11(b)) will not be more than
      $50,000 less than the amount of such inventory shown on the Interim Balance
      Sheet.

     

    (b)  All
      inventory of the Company reflected in the Interim Balance Sheet will consist
      of
      a quality and quantity usable and salable or returnable in the ordinary course
      of business, except for obsolete items and items of below-standard quality,
      all
      of which will be written off or written down to net realizable value in the
      Interim Balance Sheet. All such inventories not written off which is not
      returnable will be priced at the lower of cost or net realizable value on a
      first in, first out basis.

     

    3.12  No
      Undisclosed Liabilities.
      Except
      as set forth on Schedule
      3.12
      of the
      Disclosure Letter, the Company has no material liabilities or obligations of
      any
      nature (whether known or unknown and whether absolute, accrued, contingent,
      or
      otherwise) except for (a) liabilities or obligations (i) reflected or reserved
      against in the Interim Balance Sheet, or (ii) of a type (and not materially
      greater in amount) than those set forth in the notes to the Historical
      Statements as at December 31, 2004, (b) liabilities under the executory portion
      of Applicable Contracts, (c) liabilities disclosed, or not required to be
      disclosed, in this Agreement or the Disclosure Letter, (d) liabilities resulting
      from the consummation of the Contemplated Transactions, (e) liabilities which
      are not required under GAAP to be reflected or reserved against in the Interim
      Balance Sheet or Closing Balance Sheet which, in the aggregate, would not

     

    3.13  have
      a
      Material Adverse Effect, and (f) liabilities incurred in the ordinary course
      of
      business after the date of the Interim Balance Sheet.

     

    3.14  Taxes.
      Except
      as described on Schedule
      3.13
      of the
      Disclosure Letter:

     

    (a)  The
      Company has properly filed, in a timely manner, all Tax Returns required by
      Legal Requirements to be filed by it, and such Tax Returns and reports are
      true,
      complete and accurate in all material respects. The Company has paid all Taxes
      shown to be due on all of their respective Tax Returns or claimed to be due
      by
      any Governmental Body. The reserves and provisions for Taxes on the Interim
      Balance Sheet are adequate for all open years of the Company and for the
      Company’s current fiscal period. There are no outstanding liens for unpaid Taxes
      of the Company other than liens for real property and personal property Taxes
      not yet due and payable. All Taxes that the Company is required to withhold,
      deduct and/or collect from any Person have been properly withheld, deducted
      and
      collected and have been paid over to the appropriate Tax authority or other
      Governmental Body.

     

    (b)  The
      Company has no Knowledge of any proposed assessment of any additional Taxes
      by
      any Governmental Body. The Company is not currently being audited by any
      Governmental Body, and no such audit is pending or, to the Company’s Knowledge,
      Threatened in writing.

     

    (c)  There
      are
      no agreements, waivers, or other arrangements providing for the extension of
      time with respect to the assessment or collection of any Tax against the Company
      that are outstanding. Neither the Sellers nor the Company (collectively, the
      "Sellers' Parties") has filed any Tax form with any Governmental Body to
      intentionally make a Tax election whereby the Company is not treated as either
      a
      disregarded tax entity or a partnership for federal or state Income Tax purposes
      which (i) was in effect for any past year for which the time for audit has
      not
      expired; (ii) is currently in effect; or (iii) will be in effect at any future
      time. Neither of the Sellers’ Parties has given any waiver or extension of any
      period of limitation governing the time of assessment or collection of any
      Tax
      relating to the Company which is still currently in effect.

     

    (d)  There
      do
      not exist any past due unpaid federal, state or local Tax deficiencies assessed
      against the Company. All Taxes owed by the Company which are due and payable
      on
      or before the Closing Date pursuant to any Legal Requirements have been fully
      paid except to the extent reflected or reserved against in the Interim Balance
      Sheet. All of the 1999, 2000, 2001, 2002, 2003 and 2004 Tax Returns for the
      Company have been made available to the Buyer.

     

    (e)  The
      Company is treated as a partnership for federal Income Tax purposes. Neither
      the
      Sellers nor any of their Affiliates are considered to be “foreign
      persons”
as
      defined in IRC Section 1445. Schedule
      3.13
      sets
      forth the states in which the Company filed Income Tax Returns for the taxable
      year ended December 31, 2004.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    (f)  The
      Company has not (i) applied for any Tax ruling, or (ii) entered into a closing
      agreement as described in IRC Section 7121 or otherwise (or any corresponding
      or
      similar provision of state, municipal, county, local, foreign or other tax
      law)
      or any other agreement with any Tax authority that will have a continuing effect
      on the Company with respect to taxable periods following the
      Closing.

     

    3.15  No
      Material Adverse Effect.
      Since
      the date of the Interim Balance Sheet, except as set forth in Schedule
      3.14
      of the
      Disclosure Letter, there has not been any Material Adverse Effect, and no event
      has occurred or circumstance exists, other than the announcement or consummation
      of the Contemplated Transactions, that would reasonably be expected to result
      in
      a Material Adverse Effect.

     

    3.16  Employee
      Benefits.

     

    (a)  Schedule
      13.15(a)
      of the
      Disclosure Letter sets forth a true and complete list of all Benefit
      Plans.

     

    (b)  The
      only
      Benefit Plans with respect to which the Company has any liability other than
      the
      employment agreements listed on Schedule
      3.15(a)
      are
“employee welfare benefit plans”, as defined in ERISA Section 3(1). All
      contributions to, and premium payments in respect of, those Benefit Plans have
      been duly and timely paid. Neither the Company nor Sellers know or have reason
      to know of any uninsured benefit payable under any such welfare benefit plan
      disregarding the effect of copays, deductibles and stated plan
      limits.

     

    (c)  No
      Benefit Plan is, or at any point for which any relevant statute of limitations
      remains open was, an “employee pension benefit plan”, as defined in ERISA
      Section 3(2) including but not limited to a “multiemployer plan” within the
      meaning of ERISA Section 3(37) (a “Multiemployer Plan”). The Company is not
      subject to any withdrawal liability with respect to any Multiemployer
      Plan.

     

    (d)  Sellers
      have provided to Buyer true and complete copies of: (i) all currently effective
      plan texts and agreements relating to each Benefit Plan; (ii) the most recent
      summary plan descriptions (whether or not required to be furnished pursuant
      to
      ERISA), and the most recent annual report on Form 5500, if any, (including
      all
      schedules thereto). There are no Benefit Plans which are required to be written
      which are not written. There are no unwritten modifications to any Benefit
      Plan
      that could reasonably be expected to be enforced by a court of competent
      jurisdiction or enforced by any federal regulatory agency or
      instrumentality.

     

    (e)  Sellers,
      the Company and each of the Benefit Plans comply, in all material respects
      with
      the applicable provisions of ERISA, the Code, other applicable law and all
      binding regulatory guidance issued thereunder, each such Benefit Plan has been
      administered, in all material respects, in accordance with its terms. No
      fiduciary with respect to any Benefit Plan has 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    acted
      or
      failed to act in any manner, nor has any prohibited transaction (as such term
      is
      defined in IRC Section 4975 or ERISA Section 406) occurred which may subject
      the
      Company or the Buyers to any liability under any applicable law.

     

    (f)  There
      are
      no pending or to Sellers’ knowledge threatened claims, lawsuits or arbitrations
      (other than routine claims for benefits) that have been asserted or instituted
      against or with respect to any such Benefit Plan or the assets of any such
      Benefit Plan.

     

    (g)  The
      consummation of the transactions contemplated hereby will not (i) entitle any
      current or former employee of the Company to severance pay, unemployment
      compensation or any similar payment, or (ii) accelerate the time of payment
      or
      vesting, or increase the amount of any compensation due to any such employee
      or
      former employee.

     

    (h)  No
      Benefit Plan provides medical or death benefits (whether or not insured) with
      respect to current or former employees of the Company beyond their retirement
      or
      other termination of service other than coverage, if any, mandated by law.
      The
      Company and any entity with which is required to be aggregated for purposes
      of
      ERISA have a total of 10 employees and therefore are not subject to the “COBRA
      continuation requirements” set out in Code section 4980B.

     

    3.17  Compliance
      With Legal Requirements; Governmental Authorizations.

     

    (a)  Except
      as
      set forth in Schedule
      3.16
      of the
      Disclosure Letter:

     

    (i)  the
      Company is, and at all times since January 1, 2005 has been, in compliance
      with
      each material Legal Requirement that is or was applicable to it or to the
      conduct or operation of its business or the ownership or use of any of its
      assets, except where the failure so to comply would not have a Material Adverse
      Effect;

     

    (ii)  the
      Company has not received, at any time since January 1, 2005, any written notice
      or other written communication or, to the Company’s Knowledge, any oral notice
      or communication, from any Governmental Body regarding (A) any actual, alleged
      or to the Company’s Knowledge Threatened violation of, or failure to comply
      with, any material Legal Requirement, or (B) any actual, alleged or to the
      Company’s Knowledge Threatened obligation on the part of the Company to
      undertake, or to bear all or any portion of the cost of, any remedial action
      of
      any nature; and

     

    (iii)  the
      Company has obtained and is in possession of all Governmental Authorizations
      required for the operation of the Company’s business, except where such failure
      would not have a Material Adverse Effect.

     

    3.18  Legal
      Proceedings; Orders.

     

    (a)  Except
      as
      set forth in Schedule
      3.17(a)
      of the
      Disclosure Letter, there is no pending Proceeding to which the Company is a
      party that would have a Material Adverse Effect:

     

    (i)  that
      relates to or affects the business of, or any of the assets owned or used by,
      the Company; or

     

    (ii)  that
      challenges, or that may have the effect of preventing, delaying, making illegal,
      or otherwise interfering with, any of the Contemplated
      Transactions.

     

    To
      the
      Company’s Knowledge, except as set forth in Schedule
      3.17(a)
      of the
      Disclosure Letter, no such Proceeding has been Threatened. Sellers have made
      available for inspection by Buyer, to the extent requested by Buyer, copies
      of
      all pleadings, correspondence, and other documents, if any, in Sellers’
possession or control relating to each pending or Threatened Proceeding listed
      in Schedule
      3.17(a)
      of the
      Disclosure Letter.

     

    (b)  Except
      as
      set forth in Schedule
      3.17(b)
      of the
      Disclosure Letter:

     

    (i)  Neither
      Sellers, the Company nor any of their respective Affiliates is a party to any
      Order that affects the business of, or any of the assets owned or used by,
      the
      Company; and

     

    (ii)  To
      the
      Company’s Knowledge, no officer, director, or employee, of the Company is
      subject to any Order that prohibits such officer, director, agent, or employee
      from engaging in or continuing any conduct, activity, or practice relating
      to
      the business of the Company.

     

    (c)  Except
      as
      set forth in Schedule
      3.17(c):

     

    (i)  the
      Company is, and at all times since December 31, 2004 has been, in material
      compliance with all of the terms and requirements of each Order to which it
      is a
      party, or to which any of the assets owned or used by it, is or has been
      subject;
      and

     

    (ii)  the
      Company has not received, at any time since December 31, 2004, any written
      notice or other written communication or, to the Knowledge of Sellers, oral
      notice or communication from any Governmental Body or any other Person regarding
      any actual, alleged or Threatened violation of, or failure to comply with,
      any
      term or requirement of any Order to which the Company is a party, or to which
      any of the assets owned or used by the Company, is subject. 

     

    3.19  Absence
      of Certain Changes and Events.
      Except
      as set forth in Schedule
      3.18
      of the
      Disclosure Letter, since the date of the Interim Balance Sheet, the Company
      has
      conducted its business only in the ordinary course of business, consistent
      with
      past practice, and there has not been any Material Adverse Effect. In addition,
      since such date, except as set forth in Schedule
      3.18,
      there
      has not been any:

     

    (a)  change
      in
      the Company’s authorized or issued membership interests; grant of any stock
      option or right to purchase Securities or capital stock of the Company; issuance
      of any security convertible into such capital stock; grant of any registration
      rights; purchase, redemption, retirement, or other acquisition by the Company
      of
      any Securities or any such capital stock; or declaration or payment of any
      dividend or other distribution or payment in respect of Securities or capital
      stock;

     

    (b)  amendment
      to the Organizational Documents of the Company;

     

    (c)  payment
      or increase by the Company of any bonuses, salaries, or other compensation
      to
      any member, manager, director, officer, or (except in the ordinary course of
      business, consistent with past practice) employee or entry into any written
      employment, severance, or similar Contract with any director, officer, or
      employee;

     

    (d)  adoption
      of, or increase in the payments to or benefits under, any Benefit Plan for
      or
      with any Employees of the Company;

     

    (e)  damage
      to
      or destruction or loss of any material asset or property of the Company, whether
      or not covered by insurance, materially and adversely affecting the properties,
      assets, business, financial condition, or prospects of the Company, taken as
      a
      whole;

     

    (f)  entry
      into, termination of, or receipt of notice of termination of (i) any license,
      distributorship, sales representative, joint venture, bank credit, or similar
      agreement, or (ii) any Contract involving a total remaining commitment by or
      to
      the Company of at least $100,000;

     

    (g)  sale,
      lease, or other disposition of any material asset or property of the Company
      (other than sales of inventory, consumption of disposables and collections
      of
      receivables in the ordinary course of business, consistent with past practice)
      or mortgage, pledge, or imposition of any Encumbrance on any material asset
      or
      property of the Company, including the sale, lease, or other disposition of
      any
      material Intellectual Property Assets of the Company;

     

    (h)  (h)cancellation
      or waiver of any claims or rights with a value to the Company in excess of
      $100,000;

     

    (i)  material
      change in the accounting methods used by the Company; or

     

    (j)  agreement,
      whether oral or written, by the Company to do any of the foregoing.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    3.20  Contracts;
      No Defaults.

     

    (a)  Schedule
      3.19(a)
      of the
      Disclosure Letter contains a complete and accurate list, and Sellers have
      delivered to Buyer true and complete copies, of each written:

     

    (i)  Applicable
      Contract with each Material Customer;

     

    (ii)  Applicable
      Contract that involves performance of services or delivery of goods or materials
      to the Company of an amount or value in excess of $100,000
      annually;

     

    (iii)  Applicable
      Contract that was not entered into in the ordinary course of business and that
      involves expenditures or receipts of the Company in excess of $100,000 annually
      and which cannot be terminated on 60 days notice without penalty;

     

    (iv)  Applicable
      Contract with a wholesale distributor of the Products in the United States
      or
      Canada who entered into such Applicable Contract with the Company in such
      wholesaler’s capacity as a wholesale distributor of the Products
      that;

     

    (v)  lease,
      rental or occupancy agreement, license, installment and conditional sale
      agreement, and other written Applicable Contract affecting the ownership of,
      leasing of, title to, use of, or any leasehold or other interest in, any real
      or
      personal property (except personal property leases and installment and
      conditional sales agreements having a value per item or aggregate payments
      of
      less than $50,000 annually);

     

    (vi)  collective
      bargaining agreement and other written Applicable Contract to or with any labor
      union or other employee representative of a group of employees;

     

    (vii)  joint
      venture, partnership, and other Applicable Contract (however named) involving
      a
      sharing of profits, losses, costs, or liabilities by the Company with any other
      Person;

     

    (viii)  Applicable
      Contract containing covenants that in any way purport to restrict the business
      activity of the Company or limit the freedom of the Company to engage in any
      line of business or to compete with any Person;

     

    (ix)  Applicable
      Contract providing for payments in excess of $50,000 annually to or by any
      Person based on sales, purchases, or profits, other than direct payments for
      goods;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    (x)  power
      of
      attorney that is currently effective and outstanding;

     

    (xi)  Applicable
      Contract for capital expenditures in excess of $50,000 annually, other than
      any
      Applicable Contracts with customers providing for the installation of display
      fixtures;

     

    (xii)  guaranty
      with respect to contractual performance of a third party extended by the Company
      other than in the ordinary course of business; and

     

    (xiii)  amendment,
      supplement, and modification (whether oral or written) in respect of any of
      the
      foregoing.

     

    (b)  Except
      as
      set forth in Schedule
      3.19(b)
      of the
      Disclosure Letter or as contemplated by the Transaction Documents:

     

    (i)  No
      Material Applicable Contract that relates to the business of, or any of the
      assets owned or used by, the Company (A) provides Sellers (or any Related Person
      of Sellers other than the Company) with any rights, or the ability to acquire
      any rights, thereunder, or (B) subjects Sellers (or any Related Person of
      Sellers) to any obligation or liability thereunder; and

     

    (ii)  To
      the
      Company’s Knowledge, no officer, director, agent, Employee, consultant, or
      contractor of the Company, is bound by any Contract that purports to limit
      the
      ability of such officer, director, agent, employee, consultant, or contractor
      to
      (A) engage in or continue any conduct, activity, or practice relating to the
      business of the Company, or (B) assign to the Company or to any other Person
      any
      rights to any invention, improvement, or discovery.

     

    (c)  Except
      as
      set forth in Schedule
      3.19(c)
      of the
      Disclosure Letter, since January 1, 2005, the Company has not received from
      any
      Person, any written notice or other written communication that any Material
      Customer has determined to cease doing business with the Company or materially
      reduce the volume of Products purchased from the Company.

     

    (d)  Except
      as
      set forth in Schedule
      3.19(d)
      of the
      Disclosure Letter, since January 1, 2005 there have not been any written or
      electronic mail demands to renegotiate any material amounts paid or payable
      to
      the Company under any Material Applicable Contracts.

     

    (e)  The
      Material Customers in the aggregate accounted for not less than 70% of the
      Company’s net revenues in the Company’s last fiscal year.

     

    3.21  Insurance.

     

    (a)  Sellers
      have delivered to Buyer:

     

    (i)  true
      and
      complete copies of all policies of insurance to which the Company is a party
      or
      under which the Company, or any director of the Company, is
      covered;

     

    (ii)  true
      and
      complete copies of all pending applications for policies of insurance;
      and

     

    (iii)  any
      statement by the auditor of the Company’s financial statements with regard to
      the adequacy of such entity’s coverage or of the reserves for
      claims.

     

    (b)  Schedule
      3.20(b)
      of the
      Disclosure Letter describes, as of June 30, 2005,

     

    (i)  any
      self-insurance arrangement by or affecting the Company, including any reserves
      established thereunder; and

     

    (ii)  other
      than disclosed in the Material Applicable Contracts, any contract, other than
      a
      policy of insurance, for the transfer or sharing of the risk by the
      Company.

     

    (c)  Schedule
      3.20(c)
      of the
      Disclosure Letter sets forth, as of June 30, 2005, by year, for the current
      policy year and each of the two preceding policy years, (i) a summary of the
      loss experience under each policy, (ii) a statement describing each open claim
      under an insurance policy for an amount in excess of $100,000, and (iii) a
      statement describing the loss experience for all claims that were self-insured,
      including the number and aggregate cost of such claims.

     

    3.22  Environmental
      Matters.
      Except
      as set forth in Schedule
      3.21
      of the
      Disclosure Letter and to the Company’s Knowledge:

     

    (a)  The
      Company is in material compliance with, is not in material violation of, any
      Environmental Law. Neither Sellers nor the Company received, since January
      1,
      2004, any actual or Threatened order, notice, or other communication from (i)
      any Governmental Body or third party, or (ii) the current or prior owner or
      operator of any Facilities, of any actual or potential violation or failure
      to
      comply with any Environmental Law, or of any actual or potential Environmental
      Health and Safety Liabilities of the Company.

     

    (b)  There
      are
      no pending or Threatened claims, Encumbrances, environmental land use or other
      similar restrictions, resulting from any Environmental, Health, and Safety
      Liabilities or arising under or pursuant to any Environmental Law, with respect
      to or affecting any of the Facilities.

     

    (c)  Neither
      Sellers nor the Company has received, since January 1, 2004, any written
      citation, directive, inquiry, notice, Order, summons, warning, request for
      information, or other communication that relates to any alleged, actual, or
      potential violation or failure to comply with any Environmental Law, or of
      any
      alleged, actual, or potential Environmental, Health, and Safety Liabilities
      with
      respect to any of the Facilities or any other properties which the Company
      owned, leased or operated, or with respect to any property or facility to which
      Hazardous Materials generated, manufactured, refined, transferred, imported,
      used, or processed by the Company, have been transported, treated, stored,
      handled, transferred, disposed, recycled, or received.

     

    (d)  The
      Company has no pending unresolved Environmental, Health, and Safety Liabilities
      with respect to the Facilities or with respect to any other properties which
      the
      Company has owned, leased or operated, which would in any one instance have
      a
      Material Adverse Effect.

     

    (e)  There
      are
      no Hazardous Materials present at levels greater than applicable action,
      trigger, reporting or risk-based Cleanup levels under Environmental Laws used
      in
      the operation of the Facilities by the Company on or released by the Company
      to
      the Environment at the Facilities, including without limitation any Hazardous
      Materials contained in barrels, above or underground storage tanks, landfills,
      dumps, equipment (whether moveable or fixed) or other containers, and deposited
      or located in land, water, sumps, or any other part of the Facilities. Since
      January 1, 2004, the Company has not permitted or conducted, and the Company
      has
      no Knowledge of, any Hazardous Activity conducted with respect to the Facilities
      or any other properties owned, operated or leased by the Company except in
      material compliance with all applicable Environmental Laws.

     

    (f)  Since
      January 1, 2004, there has been no Release or Threat of Release, of any
      Hazardous Materials caused by the Company at or from the Facilities or from
      or
      by any other properties in which the Company has or had an interest whereby
      the
      cost of Cleanup would have a Material Adverse Effect.

     

    (g)  Sellers
      have delivered to or made available for review by Buyer copies and results
      of
      any reports, studies, analyses, tests, or monitoring possessed or initiated
      by
      Sellers or the Company pertaining to Hazardous Materials or Hazardous Activities
      in, on, or under the Facilities, or concerning compliance by the Company with
      Environmental Laws, or otherwise concerning the Company’s or Sellers’
Environmental, Health and Safety Liabilities, in each case since January 1,
      2004.

     

    (h)  No
      underground storage tanks owned, operated or used by the Company are located
      or
      were formerly located on any of the Facilities of the Company or Sellers except
      in material compliance with Environmental Laws.

     

    (i)  No
      event
      has occurred and no condition exits with respect to the Company or the Company’s
      operation of the Facilities which has resulted in, or is likely to result in,
      any material liability, cost or expense to Sellers with respect to the Company
      or any other Person who owns or operates the Facilities, under any applicable
      Environmental Laws.

     

    (j)  Section
      3.21 sets forth the exclusive representation and warranties with respect to
      Environmental matters, including with out limitation, Hazardous Materials,
      Hazardous Activities, Environmental, Health and Safety Liabilities,
      Environmental Laws and Occupational and Health and Safety Laws.

     

    3.23  Employees.
      Schedule
      3.22
      of the
      Disclosure Letter sets forth a list of the names of all employees of the Company
      currently employed (the “Employees”)
      and
      indicates the current salary or wage rate of each Employee. Schedule
      3.22
      of the
      Disclosure Letter sets forth a list of all Employees whose employment with
      the
      Company terminated since the date ninety (90) days prior to the date of this
      Agreement.

     

    3.24  Labor
      Relations.
      Except
      as set forth on Schedule
      3.23
      of the
      Disclosure Letter:

     

    (a)  Since
      January 1, 2004, the Company has not been and is not now a party to any
      collective bargaining or other labor Contract. There is not presently pending
      or
      existing, and to the Company’s Knowledge there is not Threatened, (i) any
      strike, slowdown, picketing, work stoppage, or employee grievance process,
      (ii)
      any Proceeding against or affecting the Company relating to the alleged
      violation of any Legal Requirement pertaining to labor relations or employment
      matters, including any charge or complaint filed by an employee or union with
      the National Labor Relations Board, the Equal Employment Opportunity Commission,
      or any comparable Governmental Body, organizational activity, or other labor
      or
      employment dispute against or affecting the Company or its premises, or (iii)
      any application for certification of a collective bargaining agent. To the
      Company’s Knowledge no event has occurred or circumstance exists that reasonably
      could be expected to provide the basis for any work stoppage or other labor
      dispute. There is no lockout of any employees by the Company, and no such action
      is currently contemplated by the Company. The Company is not liable for the
      payment of any compensation, damages, taxes, fines, penalties, or other amounts,
      however designated, for failure to comply with any of the foregoing Legal
      Requirements, except where the failure so to comply would not have a Material
      Adverse Effect.

     

    (b)  There
      are
      no pending, or to the Company’s Knowledge, Threatened claims or actions against
      the Company under any worker’s compensation policy or long-term disability
      policy that would result in a material liability to the Company. The Company
      has
      no direct or indirect liability with respect to any misclassification of any
      person as an independent contractor rather than as an employee, or with respect
      to any employee leased from another employer, except as would not result in
      material liability to the Company.

     

    3.25  Intellectual
      Property.

     

    (a)  Intellectual
      Property Assets - The term “Intellectual
      Property Assets”
      means:

     

    (i)  all
      registered and unregistered trademarks, service marks, and applications for
      registration thereof (collectively, “Marks”)
      listed
      on Schedule
      3.24(a)(i)
      of the
      Disclosure Letter;

     

    (ii)  all
      patents and patent applications (collectively, “Patents”)
      listed
      on Schedule
      3.24(a)(ii)
      of the
      Disclosure Letter; and

     

    (iii)  know-how,
      trade secrets, confidential information, customer lists, software, technical
      information, data, process technology, plans, drawings, and blue prints; owned,
      used, or licensed by the Company either as licensee or licensor, which are
      not
      part of the public knowledge or literature (collectively, “Trade
      Secrets”).

     

    (b)  Agreements.
      Schedule
      3.24(b)
      of the
      Disclosure Letter contains a complete and accurate list of all Applicable
      Contracts relating to Intellectual Property Assets. There are no outstanding
      and, to the Company’s Knowledge, no Threatened disputes or disagreements with
      respect to any such Applicable Contracts identified or required to be identified
      in Schedule
      3.24(b)
      of the
      Disclosure Letter.

     

    (c)  Intellectual
      Property Assets.
      Except
      for license agreements described or not required to be described in Schedule
      3.24(c)
      of the
      Disclosure Letter, the Company is not obligated to pay any third party to use
      its Intellectual Property Assets.

     

    (d)  Patents
      and Marks.
      Schedule
      3.24(d)
      sets
      forth a list of all United States and foreign Patents, registered and material
      unregistered Marks, registered copyrights and applications therefor owned by
      the
      Company (the “Patent
      and Trademark Rights”).
      Except as set forth in Schedule
      3.24(d),
      and
      except for agreements set forth on Schedule
      3.24(b),
      the
Patent
      and Trademark Rights
      are all
      the Patent
      and Trademark Rights
      that are
      material to the operation of the business of the Company as currently being
      conducted. The Company is the owner of all title and interest in and to each
      of
      the Patent
      and Trademark Rights,
      free
      and clear of all Encumbrances. There are no material claims or proceedings
      pending or, to the Company’s Knowledge, Threatened against the Company asserting
      that its use of any of the Patent
      and Trademark Rights
      infringes the rights of any other person. To the Company’s Knowledge, there are
      no third parties infringing upon the Company’s Patent
      and Trademark Rights
      in any
      material respect.

     

    (e)  Trade
      Secrets.
      Except
      as set forth in Schedule
      3.24(e)
      of the
      Disclosure Letter:

     

    (i)  The
      Company has taken commercially reasonable precautions to protect the secrecy,
      confidentiality, and value of its Trade Secrets.

     

    (ii)  To
      the
      Company’s Knowledge, the Company’s Trade Secrets have not been divulged, or
      misappropriated either for the benefit of any Person (other than one or more
      of
      the Company, Sellers or Sellers’ Affiliates) or to the detriment of the Company.
      To the Company’s Knowledge, no Trade Secret of the Company is subject to any
      adverse claim.

     

    3.26  Certain
      Payments.
      Since
      January 1, 2004, to the Company’s Knowledge, neither the Company, nor any
      director, officer, agent, or Employee of the Company, or any other Person
      associated with or acting for or on behalf of the Company, has directly or
      indirectly (a) made any contribution, gift, bribe, rebate, payoff, influence
      payment, kickback, or other payment to any Person, private or public, regardless
      of form, whether in money, property, or services (i) to obtain favorable
      treatment in securing business, (ii) to pay for favorable treatment for business
      secured, or (iii) to obtain special concessions or for special concessions
      already obtained, for or in respect of the Company, in each such case in
      violation of any Legal Requirement, or (b) established or maintained any fund
      or
      asset which should be recorded in the books and records of the Company that
      has
      not been so recorded in the books and records of the Company.

     

    3.27  Relationships
      With Related Persons.
      Except
      as set forth in Schedule
      3.26
      of the
      Disclosure Letter:

     

    (a)  Neither
      Sellers nor any Related Person of Sellers or of the Company has any interest
      in
      any material property (whether real, personal, or mixed and whether tangible
      or
      intangible), used in or pertaining to the Company’s business.

     

    (b)  Neither
      Sellers nor any Related Person of Sellers or of the Company owns (of record
      or
      as a beneficial owner) an equity interest or any other financial or profit
      interest in, a Person that (i) has business dealings or a material financial
      interest in any transaction with the Company (other than business dealings
      or
      transactions conducted in the ordinary course of business with the Company
      at
      substantially prevailing market prices and on substantially prevailing market
      terms), or (ii) engages in competition with the Company with respect to any
      line
      of the products or services of the Company (a “Competing Business”) in any
      market presently served by the Company.

     

    (c)  Neither
      Sellers nor any Related Person of Sellers or of the Company is a party to any
      Contract with, or has any claim or right against, the Company.

     

    3.28  Payout
      Arrangements.
      Sellers,
      concurrently with the Closing, have fully paid all amounts due and owing on
      the
      Payout Arrangements and, subsequent to such payments, there will be no
      outstanding obligation for any Payout Arrangement. In addition, Sellers have
      paid or 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    reserved
      such necessary amounts of money to satisfy in full all the following additional
      payments: (a) a sale bonus of $300,000 to Kelly Kaplan pursuant her employment
      letter dated September 13, 1999, (b) a sale fee of $750,000 (plus up to an
      additional $250,000 contingent on Sellers’ receipt of all escrow amounts under
      the Traditional Escrow Agreement and the Regulatory Escrow Agreement) to Ray
      Duane pursuant his consulting agreement dated September 30, 1999 and (c) an
      allocation of proceeds of $1,819,924 to Michael Lesser pursuant to the Amended
      and Restated Limited Liability Company Agreement of Dental Concepts LLC dated
      as
      of March 15, 2002 (“Additional
      Payments”).
      Buyer
      shall have no obligations or liabilities with regards to such Additional
      Payments.

     

    3.29  Supplier
      Letters.
      Certain
      correspondence with certain of the Company’s suppliers is attached as
Schedule
      3.28
      to the
      Disclosure Letter. The Company has no Knowledge that any of the suppliers will
      fail to abide by the commitments made in such correspondence.

     

    3.30  Brokers
      or Finders.
      Except
      as set forth in Schedule
      3.29
      of the
      Disclosure Letter, Sellers and their agents have incurred no obligation or
      liability, contingent or otherwise, for brokerage or finders’ fees or agents’
commissions or other similar payment in connection with this
      Agreement.

     

    4.  REPRESENTATIONS
      AND WARRANTIES OF BUYER

     

    Buyer
      represents and warrants to Sellers as follows:

     

    4.1  Organization
      and Good Standing.
      Buyer
      is a corporation duly organized, validly existing, and in good standing under
      the laws of the State of Delaware.

     

    4.2  Authority;
      No Conflict.

     

    (a)  This
      Agreement and the Contemplated Transactions have been duly authorized by Buyer,
      including all necessary actions of Buyer’s directors. Assuming the due execution
      and delivery of this Agreement by Sellers, this Agreement constitutes the legal,
      valid, and binding obligation of Buyer, enforceable against Buyer in accordance
      with its terms, except to the extent enforceability may be limited by
      bankruptcy, insolvency, reorganization, moratorium or other similar laws
      affecting the enforcement of creditors’ rights in general and subject to general
      principles of equity and the discretion of courts in granting equitable
      remedies. Upon the execution and delivery by Buyer of the Transaction Documents
      to which Buyer is a party, and assuming the due execution and delivery of such
      Transaction Documents by the other parties thereto, such Transaction Documents
      will constitute the legal, valid, and binding obligations of Buyer, enforceable
      against Buyer in accordance with their respective terms, except to the extent
      enforceability may be limited by bankruptcy, insolvency, reorganization,
      moratorium or other similar laws affecting the enforcement of creditors’ rights
      in general and subject to general principles of equity and the discretion of
      courts in granting equitable remedies. Buyer has the absolute and unrestricted
      right, power, authority, and capacity to execute and deliver this Agreement
      and
      the Transaction Documents to which it will be a party and to perform its
      obligations under this Agreement and the Transaction Documents to which it
      will
      be a party.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    (b)  Except
      as
      set forth in Schedule
      4.2,
      neither
      the execution and delivery of this Agreement by Buyer nor the consummation
      or
      performance of any of the Contemplated Transactions by Buyer will give any
      Person the right to prevent, delay, or otherwise interfere with any of the
      Contemplated Transactions pursuant to:

     

    (i)  any
      provision of Buyer’s Organizational Documents;

     

    (ii)  any
      resolution adopted by the board of directors or the stockholders of
      Buyer;

     

    (iii)  any
      Legal
      Requirement or Order to which Buyer may be subject; or

     

    (iv)  any
      Contract to which Buyer is a party or by which Buyer may be bound.

     

    (c)  Except
      as
      set forth in Schedule
      4.2,
      neither
      the execution and delivery of this Agreement nor the consummation or performance
      of the transaction described in clause (a) of the definition of Contemplated
      Transactions will, directly or indirectly (with or without notice or lapse
      of
      time) contravene, conflict with, or result in a violation of, any Legal
      Requirement or any Order to which Buyer is a party, or to which any of the
      assets owned or used by Buyer is subject, and Buyer is not required to obtain
      any Consent or Governmental Authorization from any Person in connection with
      the
      execution and delivery of this Agreement or the consummation or performance
      of
      any of the Contemplated Transactions.

     

    4.3  Investment
      Intent.
      Buyer:
      (a) is acquiring the Securities for its own account, for investment only, and
      not with a view to, or for sale in connection with, any distribution in
      violation of the Securities Act or any rule or regulation under the Securities
      Act, (b) is a sophisticated investor and has sufficient knowledge and experience
      in financial and business matters to be able to evaluate the merits and risks
      of
      its investment in the Securities, (c) acknowledges that Sellers have made
      available to Buyer (i) the opportunity to ask questions of (and to receive
      answers from) the officers and directors of the Company, and (ii) the
      opportunity to acquire all information about the Company as Buyer has determined
      is necessary to evaluate the merits and risks of its investment in the
      Securities, (d) understands that the Securities (A) have not been registered
      under the Securities Act or under any state securities laws; (B) are being
      sold
      to Buyer in reliance on exemptions from the registration requirements of the
      Securities Act and such state securities laws; (C) are “restricted
      securities”
within
      the meaning of Rule 144 under the Securities Act; and (D) may not be sold,
      transferred or otherwise disposed of unless subsequently registered under the
      Securities Act and applicable state securities laws or unless an exemption
      from
      registration is then available, and (e) is able to bear the economic risk and
      lack of liquidity inherent in holding the Securities.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    4.4  Certain
      Proceedings.
      There
      is no pending Proceeding that has been commenced against Buyer and that
      challenges, or may have the effect of preventing, delaying, making illegal,
      or
      otherwise interfering with, any of the Contemplated Transactions. To Buyer’s
      Knowledge, no such Proceeding has been Threatened.

     

    4.5  Brokers
      or Finders.
      Buyer
      and its officers and agents have incurred no obligation or liability, contingent
      or otherwise, for brokerage or finders’ fees or agents’ commissions or other
      similar payment in connection with this Agreement.

     

    4.6  Breach
      by Sellers of the Company.
      Buyer
      has no knowledge of any breach or inaccuracy in any representation, warranty
      or
      covenant of the Company or Sellers in this Agreement, including as a result
      of
      any due diligence investigation undertaken by the Buyer.

     

    5.  INDEMNIFICATION;
      REMEDIES; ESCROWED FUNDS

     

    5.1  Obligation
      to Indemnify.

     

    (a)  Subject
      to the terms and conditions hereof, Sellers agree to indemnify, defend and
      hold
      harmless Buyer and its directors, officers, employees, Affiliates, stockholders
      and permitted assigns (the “Buyer’s
      Indemnified Parties”)
      for,
      and will pay to Buyer Indemnified Parties the amount of, any loss, liability,
      claim, damages, reasonable expenses (collectively, “Damages”)
      resulting from or arising out of (i) any Breach of any representation or
      warranty made by the Company in Article 3 of this Agreement; (ii) any Breach
      of
      any covenant or agreement of any Seller contained in this Agreement; (iii)
      any
      and all amounts of federal, state, and or local income taxes that may be
      assessed against Buyer and/or the Company with respect to any Pre-Closing
      Taxable Period(s) for which adequate provisions therefore have not been made
      through the Closing Date, as reflected on the Company’s books of account and in
      the Closing Balance Sheet and the amount(s) of any interest and/or penalties
      that may be assessed with respect to said tax assessments; and (iv) to the
      extent occurring prior to Closing, any violation of applicable Environmental
      Laws and any licenses or permits related thereto by the Company or, the Release
      or Threatened Release in, at, under, from, or on the Facilities of toxic or
      hazardous substances during the ownership or occupancy thereof by the Company
      which resulted in an Environmental Liability.

     

    Notwithstanding
      the foregoing, (i) Sellers shall not have any liability under Section 5.1(a)(i),
      (a)(ii) and 5.1(b) unless the aggregate of all Damages relating thereto exceeds,
      on a cumulative basis, Two Hundred Fifty Thousand Dollars ($250,000) (the
“Basket”),
      and
      then only to the extent of such excess, and (ii) Sellers’ aggregate liability
      under Section 5.1(a)(i) and (a)(ii) shall in no event exceed Three Million
      Dollars ($3,000,000) (the “Ceiling”).
      Provided,
      however,
      that a
      breach of warranties set forth in Sections 3.27 and the covenant in Section
      6.1
      shall not be subject to the Basket or to the Ceiling but rather, for purposes
      of
      clarification, Sellers shall be liable to Buyers for the first dollar thereof
      and the 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Buyer
      shall not be limited to $3,000,000 of damages. Provided,
      further,
      however,
      that
      any liability of the Sellers under Section 5.1(a)(i) shall be several in nature
      only, so that each Seller’s proportionate share of such liability for such
      Damages shall not exceed the amount determined by multiplying such aggregate
      Damages indemnifiable under Section 5.1(a)(i) (in excess of the Basket and
      up to
      a maximum of the Ceiling, less any amounts theretofore paid under Section
      5.1(a)(i) or (ii)) in respect of such claim by such Seller’s Securities
      Ownership Percentage. In addition, no Seller shall have any liability under
      Section 5.1(a)(ii) above except for the Seller who is in breach of the covenant
      or covenants referred to in Section 5.1(a)(ii).

     

    (b)  In
      addition to Sellers’ indemnification obligations under Section 5.1(a), Sellers
      agree to indemnify, defend and hold harmless Buyer (and its directors, officers,
      employees, Affiliates, stockholders and assigns) from and against all Damages
      resulting from or arising out of Damages pertaining to any Product Liability
      Claim, subject to the following: (i) Sellers shall only be liable with respect
      to the products that were sold by the Company prior to the Closing, (ii) Buyer
      shall maintain the Company’s current insurance coverage; (iii) Sellers shall
      have no liability under this Section with respect to any third-party claim
      that
      is first asserted more than eighteen (18) months following the Closing Date;
      and
      (iv) Sellers’ aggregate liability with respect to product liability shall in no
      event exceed $1,000,000 during any consecutive twelve (12) month
      period.

     

    (c)  Buyer
      agrees to indemnify, defend and hold harmless Sellers and their respective
      directors, officers, managers, employees, Affiliates, stockholders and assigns
      (collectively, “Sellers’
      Indemnified Parties”)
      from
      and against all Damages resulting from or arising out of (i) any Breach of
      any
      representation, warranty, covenant or agreement of Buyer contained in this
      Agreement; and (ii) obligations arising from the conduct of the business of
      the
      Company subsequent to the Closing.; (iii) except to the extent subject to
      Seller’s indemnity hereof, the violation of Environmental Laws, including
      permits or licenses related thereto by the Company or the Release of Threatened
      of Release in, at, under, from, or on the Facilities of toxic or hazardous
      substances during the occupancy thereof by the Company on or after Closing.
      Notwithstanding the foregoing, Buyer shall not have any liability under clause
      (i) of this Section 5.1(c) unless the aggregate of all Damages relating thereto
      exceeds, on a cumulative basis, Two Hundred and Fifty Thousand Dollars
      ($250,000), and then only to the extent of such excess.

     

    (d)  The
      term
“Damages” as used in this Section 5.1 is not limited to matters asserted by
      third parties against Sellers or Buyer, but includes Damages incurred or
      sustained by any of them in the absence of third party claims. Payments by
      a
      party of amounts for which such party is indemnified hereunder shall not be
      a
      condition precedent to recovery.

     

    5.2  Notice
      of Asserted Liability.
      Promptly after Buyer or the Sellers’ Agent becomes aware of any fact, condition
      or event that may give rise to Damages for which indemnification may be sought
      under this Article 5, the party entitled to indemnification (“Indemnitee”)
      shall
      give notice thereof in the manner provided in this Section 5.2 of this Agreement
      (the “Claims
      Notice”)
      to the
      other party (i.e. the Seller’s Agent, in the case of a claim under Section
      5.1(a) hereof, of the Buyer, in the case of a claim under Section 5.1(b) hereof)
      (the “Indemnitor”).
      The
      Claims Notice shall include a description in reasonable detail of any claim
      or
      the commencement (or threatened commencement) of any action, proceeding or
      investigation (an “Asserted
      Liability”)
      against Indemnitee, and shall indicate the amount (estimated, if necessary)
      of
      the Damages that have been or may be suffered by Indemnitee. Failure of
      Indemnitee to promptly give notice hereunder shall not affect rights to
      indemnification hereunder, except to the extent that Indemnitor demonstrates
      actual damage caused by such failure. Upon Indemnitor’s request, Indemnitee
      shall provide Indemnitor with such reasonable documentation as Indemnitor shall
      request pertaining to any claim(s) made by Indemnitee. 

     

    5.3  Opportunity
      to Defend.
      Indemnitor may elect to compromise or defend, at its own expense and by its
      own
      counsel, any Asserted Liability (it being understood that the Sellers’ Agent
      shall have the exclusive right to defend, compromise or settle); provided,
      however,
      that
      Indemnitor may not compromise or settle any Asserted Liability without the
      consent of Indemnitee, such consent not to be unreasonably withheld, unless
      such
      compromise or settlement requires no more than a monetary payment for which
      Indemnitee and any other indemnifiable parties hereunder are fully indemnified
      or involves other matters not binding upon Indemnitee or such other
      indemnifiable parties. If Indemnitor elects to compromise or defend such
      Asserted Liability, it shall within 15 days (or sooner, if the nature of the
      Asserted Liability so requires) notify Indemnitee of its intent to do so and
      Indemnitee shall cooperate in the compromise of, or defense against, such
      Asserted Liability. If Indemnitor elects not to compromise or defend any
      Asserted Liability, fails to notify Indemnitee of its election as herein
      provided or contests its obligation to indemnify, Indemnitee may pay, compromise
      or defend such Asserted Liability without prejudice to any right it may have
      hereunder. In any event, each of Buyer and Sellers may participate, at its
      own
      expense, in the defense of any Asserted Liability in respect of which it may
      have an indemnification obligation under Section 5.2. If either party chooses
      to
      defend or participate in the defense of any Asserted Liability, it shall have
      the right to receive from the other party any books, records or other documents
      within such party’s control that are necessary or appropriate for such
      defense.

     

    5.4  Traditional
      Escrowed Funds.
      Pursuant to the terms of an escrow account in the form attached hereto as
Exhibit
      5.4
      (the
“Traditional
      Escrow Agreement”),
      if
      and to the extent the Sellers are obligated to indemnify Buyer pursuant to
      Sections 5.1 or 5.2, Buyer may notify the Escrow Agent and the Sellers’ Agent of
      Buyer’s claim for indemnification, including the amount thereof, as provided in
      the Traditional Escrow Agreement. The provisions of the Traditional Escrow
      Agreement shall then govern such claim and the disbursement of funds by the
      Traditional Escrow Agreement. Any remaining Traditional Escrow Amounts shall
      be
      distributed to the Sellers eighteen (18) months from the Closing Date.

     

    5.5  Regulatory
      Escrowed Funds.
      Pursuant to the terms of an escrow account in the form attached hereto as
Exhibit
      5.5
      (the
“Regulatory
      Escrow Agreement”),
      the
      Regulatory Escrow Amount shall be held for 36 months following the Closing
      Date
      unless one of the following events occurs; (a) publication of a §510(k)
      application by the FDA that permits commercial over-the-counter distribution
      of
      the NightGuardTM device and/or its generic equivalent; (b) a determination that
      the NightGuardTM device and/or its generic equivalent is a consumer product and
      not subject to FDA regulation; (c) categorization of the device by the FDA
      as
      Category 1 Exempt (and thus not requiring any further sanctioning by the Agency)
      or (d) any other notification by the FDA of the Sellers right to continue
      marketing the product in its current distribution channels at which point the
      Regulatory Escrowed Funds shall thereafter be distributed to Sellers.
      Notwithstanding the foregoing, it is specifically agreed that if the NightGuardTM
device continues to be in over-the-counter distribution 36 months after the
      Closing Date, the Regulatory Escrow Amount shall be distributed to Sellers.
      In
      the event the FDA takes action , prior to the date 36 months after the date
      hereof, which results in the prohibition of the over the counter distribution
      of
      the NightGuardTM device the Regulatory Escrow Fund shall be paid to Buyer. Each
      of Buyer and Sellers’ Agent agrees to execute instructions to the escrow agent
      under the Regulatory Escrow Agreement authorizing distribution of such
      Regulatory Escrow Amounts in a manner consistent with this Section
      5.5.

     

    5.6  Damages
      Net of Insurance, Etc.
      The
      amount of any Damage for which indemnification is provided under this Article
      5
      shall be net of (a) in the case of Section 5.1(a), any reserves established
      in
      the Interim Balance Sheet or the Closing Balance Sheet, (b) subject to Section
      5.7, any amounts actually recovered by the Indemnitee pursuant to any
      indemnification by or indemnification agreement with any third party (a
“Third
      Party Source”);
      (c)
      any insurance proceeds actually recovered by the Indemnitee from a third party
      insurer with respect to any policy (provided that in the event of a recovery
      under any such policy, the amount of the recovery shall be offset by any
      increase in premiums arising as a direct result of the filing or the payment
      of
      such claim) under which the Company is insured immediately prior to the Closing
      Date (an “Insurance
      Source”),
      (each
      such person named in clauses (a), (b), and (c), a “Collateral
      Source”),
      and
      (d) an amount equal to the Tax benefit actually realized by the Indemnitee
      (assuming for the purposes of this Section that the person receiving such Tax
      benefits is subject to a 40% marginal income tax rate), if any, attributable
      to
      such Loss. If the amount to be netted hereunder from any payment required under
      Sections 5.1(a) or 5.1(b) is received after payment by the Indemnitor of any
      amount otherwise required to be paid to an Indemnitee pursuant to this Article
      5, the Indemnitee shall repay to the Indemnitor, promptly after such receipt,
      any amount that the Indemnitor would not have had to pay pursuant to this
      Article 5 had such determination been made at the time of such
      payment.

     

    5.7  Collateral
      Sources.
      Indemnification under this Article 5 shall not be available to any Buyer
      Indemnified Party unless such Buyer Indemnified Party first uses all reasonable
      efforts to obtain recovery from any Insurance Source for such claim before
      making any claim for 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    indemnification
      pursuant to Section 5.1 hereof; provided,
      however,
      the
      parties acknowledge and agree that during such time as any Buyer Indemnified
      Party is pursuing recovery from an Insurance Source, the Buyer Indemnified
      Party
      may file a Claims Notice (but will not pursue such claim until the Buyer
      Indemnified Party has exhausted all reasonable efforts to obtain recovery from
      the Insurance Source). Any Indemnitor may, in its sole discretion, require
      any
      Indemnitee (i) to grant an assignment to the Indemnitor of the right of such
      Indemnitee to assert a claim against any Third Party Source at the Indemnitor’s
      own expense or (ii) if the right is not assignable, to permit the Indemnitor
      to
      pursue a claim with respect to such right against the Third Party Source in
      the
      name of the Indemnitee at the Indemnitor’s own expense. The Indemnitee shall
      promptly remit to the Indemnitor any proceeds received by the Indemnitee from
      any such claim against a Third Party Source which has been assigned to
      Indemnitor or which Indemnitor is pursuing in the name of Indemnitee.

     

    5.8  Limitation
      of Remedies.
      Notwithstanding anything in this Agreement, the remedies set forth in this
      Article 5, the Traditional Escrow Agreement and the Regulatory Escrow Agreement
      shall be the sole remedies to which any party hereto is entitled for breach
      or
      noncompliance with the provisions of this Agreement, or any other agreement,
      instrument or document delivered in connection with the Contemplated
      Transactions; provided,
      however,
      that
      the foregoing shall not limit the right of any party to obtain injunctive
      relief, specific performance or similar equitable relief. In no event shall
      any
      party hereto be entitled to recover, or be liable to any other party for
      special, indirect, consequential, exemplary or punitive damages, except to
      the
      extent the Indemnitee has been held liable to a third-party for such damages,
      in
      which case the Indemnitor’s liability shall include the full amount of
      Indemnitee’s Damages in respect of such third-party claim. The parties to this
      Agreement shall be obligated to use commercially reasonable efforts to mitigate
      the amount of Damages otherwise recoverable hereunder. Buyer shall not be
      entitled to indemnification in respect of any matter which was the subject
      of
      the adjustments to the purchase price contemplated by Sections 2.5, 2.7 and
      2.8
      of this Agreement.

     

    6.  ADDITIONAL
      AGREEMENTS

     

    6.1  Ray
      Duane Indemnification.
      Sellers
      shall indemnify Buyer for any and all claims brought by Ray Duane with regards
      to any claims for compensation.

     

    6.2  Continuation
      of Insurance.
      Buyer
      shall maintain insurance respecting its assets and those of its subsidiaries
      (including after the Closing, the Company) wherever located, covering loss
      or
      damage by fire, theft, explosion, and all other hazards and risks as ordinarily
      are insured against by other Persons engaged in the same or similar
      businesses.

     

    6.3  Access
      to Records.
      Buyer
      agrees that Sellers shall be entitled, for any lawful purpose, including (a)
      preparing tax returns, and (b) preparing and auditing financial statements,
      after Closing, upon reasonable notice and during the regular business hours
      of
      the Company, to have reasonable access to and to make copies of the financial
      and tax business records of the Company which relate to periods prior to the
      Closing. Buyer shall cause the Company to retain 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    such
      records for a period of five years following the Closing, after which time
      Buyer
      may permit the Company to destroy or otherwise dispose of such business records
      without Sellers’ consent. Notwithstanding the foregoing, if Buyer or the Company
      notifies Sellers in writing that it desires to dispose of such business records,
      Sellers shall have a period of sixty (60) days following its receipt of such
      notice to obtain possession thereof. If and to the extent Sellers do not elect
      to obtain such possession, Buyer or the Company shall be entitled to dispose
      of
      such business records as described in such notice.

     

    7.  TAX
      COVENANTS

     

    7.1  Sellers’
      Liability.
      Sellers
      will be solely responsible for all Income Taxes imposed upon the Company with
      respect to Pre-Closing Periods, and, with respect to Straddle Periods, Income
      Taxes imposed upon the Company which are allocable, pursuant to Section 7.3,
      to
      the portion of such taxable year or period ending on the Closing Date, except
      to
      the extent, in either case that such Taxes are adequately reserved in the
      Closing Balance Sheet. Sellers shall receive the benefit of all Tax losses
      incurred by the Company with respect to Pre-Closing Periods and, with respect
      to
      Straddle Periods, the benefit of all Tax losses incurred by the Company which
      are allocable, pursuant to Section 7.3, to the portion of such taxable year
      or
      period ending on the Closing Date.

     

    7.2  Buyer’s
      Liability.
      Buyer
      will be solely responsible for any and all Taxes of, or payable by, the Company
      which the Sellers are not responsible for pursuant to Section 7.1, including,
      in
      the case of Income Taxes with respect to a Straddle Period, the portion of
      such
      taxable year or period commencing after the Closing Date as determined pursuant
      to Section 7.3. Buyer shall receive the benefit of all Tax losses incurred
      by
      the Company to which Sellers are not entitled pursuant to Section 7.1,
      including, in the case of all Tax losses incurred by the Company with respect
      to
      a Straddle Period, the portion of such taxable year or period commencing after
      the Closing Date as determined pursuant to Section 7.3. In addition, Buyer
      will
      be solely responsible for any and all Taxes (other than Income Taxes described
      in Section 7.1 which shall remain the responsibility of the Sellers) applicable
      to, imposed on or arising out of the Contemplated Transactions.

     

    7.3  Apportionment
      of Income Taxes.
      In
      order to apportion appropriately any Income Taxes relating to any taxable year
      or period that includes a Straddle Period, the parties will, to the extent
      permitted under applicable law, elect with the relevant Tax authority or agency
      to treat for all purposes the Closing Date as the last day of the taxable year
      or period of the Company. In the case of any Straddle Period, the portion of
      any
      Income Taxes that is allocable to the portion of the Straddle Period ending
      on
      the Closing Date will be deemed equal to the amount which would be payable
      if
      the taxable year or period ended on the Closing Date (except that, solely for
      purposes of determining the marginal tax rate applicable to income during such
      period in a jurisdiction in which such tax rate depends upon the level of
      income, annualized income shall be taken into account, for an equitable sharing
      of such Income Taxes).

     

    7.4  Preparation
      of Tax Returns.

     

    (a)  Sellers
      will prepare and file (or cause to be prepared and filed) in a timely manner
      the
      Income Tax Returns required to be filed by the Company (after giving effect
      to
      any valid extensions of the due date for filing any such Income Tax Returns)
      for
      any Pre-Closing Periods. Sellers will timely pay (or cause to be timely paid)
      all Income Taxes shown as due and owing on all such Income Tax
      Returns.

     

    (b)  Buyer
      will prepare and file (or cause to be prepared and filed) in a timely manner
      the
      Income Tax Returns of the Company for any Straddle Period; provided,
      however,
      that
      Buyer shall submit such Income Tax Returns to Sellers’ Agent with a proposed
      allocation of the Income Taxes in which Sellers are responsible pursuant to
      Section 7.1 with respect to such Straddle Period (the “Sellers’
      Straddle Period Allocation”),
      for
      review and approval, at least 45 days prior to the filing date (after giving
      effect to any valid extensions). Buyer will be responsible to pay (or cause
      to
      be paid) all Income Taxes shown as due and owing by the Company on all such
      Income Tax Returns. Within 15 days after receipt of the Income Tax Returns
      relating to a Straddle Period, Sellers’ Agent shall deliver to Buyer written
      notice of any disagreement with respect to the Income Tax Returns or the
      calculation of the Sellers’ Straddle Period Allocation. Buyer and Sellers shall
      attempt to resolve any disputes with respect to such Income Tax Returns or
      calculations; provided that if they are unable to do so within 15 days after
      delivery of notice of the disagreement, such disputed items shall be submitted
      to the Independent Accountant for final determination, which determination
      shall
      be binding upon Buyer and Sellers. Sellers shall pay to Buyer on or before
      the
      date which is the later of three business days before the due date of the final
      Income Tax Return for the Straddle Period (after giving effect to any valid
      extensions), or five days after the final determination by the Independent
      Accountant, the amount of the Income Tax liability for the Straddle Period
      that
      Sellers are responsible for as determined in Section 7.1 and this Section
      7.4(b). Except as otherwise provided in this Section 7.4, Buyer will also
      prepare and file, or cause to be prepared and filed, any and all other Tax
      Returns required to be filed by the Company. Buyer will be responsible to pay
      (or cause to be paid) all Taxes shown as due and owing by the Company on all
      such Tax Returns. All Tax Returns shall be prepared in a manner consistent
      with
      the past practices of the Company and Sellers, unless otherwise required by
      applicable law.

     

    7.5  Other
      Covenants.
      Neither
      Buyer nor any Affiliate thereof shall amend, refile or otherwise modify, or
      cause or permit the Company to amend, refile or otherwise modify, any Tax
      election or Tax Return with respect to any Pre-Closing Period or Straddle Period
      without the prior written consent of Sellers. Sellers shall be entitled to
      all
      refunds, if any, attributable to Taxes for any Pre-Closing Period or the portion
      of any Straddle Period ending on the Closing Date or attributable to Income
      Taxes listed in Section 7.1, and Buyer shall deliver such refunds to Sellers
      as
      promptly as possible upon receipt. Buyer shall, if Sellers so request and at
      Sellers’ expense, cause the Company to file for and use its reasonable best
      efforts to obtain and expedite any claim for (and any receipt of) refund to
      which Sellers are entitled to under this Section 7.5.

     

    7.6  Contests.

     

    (a)  Notice.
      Following the Closing, Buyer will immediately notify Sellers in writing of
      any
      proposed assessment or claim or the commencement of any audit or administrative
      or judicial or other Proceeding involving Taxes which, if determined adversely,
      could result in a liability to Sellers under this Agreement or which could
      cause
      an adjustment in the Tax liability of Sellers or their Affiliates. Following
      the
      Closing, Sellers will immediately notify Buyer in writing of any proposed
      assessment or claim or the commencement of any audit or administrative or
      judicial or other Proceeding involving Taxes which, if determined adversely,
      could affect the determination of Taxes to which the Company may be subject
      in
      or for Post-Closing Periods, but only to the extent that Sellers are notified
      thereof. In each case, such notice shall contain factual information to the
      extent known describing the asserted Tax liability in reasonable detail and
      shall include copies of any notice or other document received from any Tax
      authority in respect of any such asserted Tax liability.

     

    (b)  Pre-Closing
      Period Contests.
      In the
      case of an audit or administrative or judicial or other Proceeding with respect
      to Taxes that relates to any Pre-Closing Period, Sellers will have the right
      at
      its own expense to control the conduct of such audit or Proceeding including
      settling or compromising the issue or matter. If Sellers elect to direct such
      audit or Proceeding, Sellers shall, within thirty (30) days following receipt
      of
      notice from Buyer of any such audit or Proceeding, notify Buyer of Sellers’
intent to do so, and Buyer shall cooperate and shall cause the Company to fully
      cooperate, at Sellers’ expense, in each phase of the audit or Proceeding. If
      Sellers elect not to direct such audit or Proceeding, Buyer or the Company,
      as
      applicable, may assume control of such audit or Proceeding (at Buyer’s expense);
provided,
      however,
      in such
      case, Buyer shall provide Sellers with a timely and reasonably detailed account
      of each phase of the audit or Proceeding, and neither Buyer nor the Company
      may
      settle or compromise any asserted liability without the prior written consent
      of
      Sellers. In any event, Sellers may participate, at their own expense, in any
      audit or Proceeding related to any Pre-Closing Period, and Buyer may
      participate, at its own expense, in any audit or Proceeding related to any
      Taxes
      which could affect the determination of Taxes to which the Company may be
      subject in or for any Post-Closing Period.

     

    (c)  Straddle
      Period Contests.
      In the
      case of any audit or administrative or judicial Proceeding that relates to
      any
      Tax for any Straddle Period, Sellers may elect to direct and control, through
      counsel of its own choosing, any audit or Proceeding. If Sellers elect to direct
      such audit or Proceeding, Sellers shall, within thirty (30) days following
      receipt of notice from Buyer of any such audit or Proceeding, notify Buyer
      of
      Sellers’ intent to do so, and Buyer shall cooperate and shall cause the Company
      to fully cooperate, at Sellers’ expense, in each phase of the audit or
      Proceeding. If Sellers elect not to direct such audit or Proceeding, Buyer
      or
      the Company, as applicable, may assume control of such audit or Proceeding
      (at
      Buyer’s expense); provided,
      however,
      in such
      case, Buyer shall provide Sellers with a timely and reasonably detailed account
      of each phase of the audit or Proceeding, and neither Buyer nor the Company
      may
      settle or compromise any asserted liability without the prior written consent
      of
      Sellers. In any event, Sellers may participate, at their own expense, in any
      audit or Proceeding 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    related
      to a Straddle Period. Except as provided otherwise in this Section 7.6, Buyer
      will control, at its own expense, any and all audit, administrative and judicial
      Proceedings related to the Taxes of the Company.

     

    7.7  Cooperation.
      Sellers
      and Buyer shall provide each other, at no charge, with such cooperation and
      information as either of them reasonably may request of the other (and Buyer
      shall cause the Company to provide such cooperation and information) in filing
      any Tax Return, amended Tax Return or claim for refund, determining a liability
      for Taxes or a right to a refund of Taxes or participating in or conducting
      any
      audit or other Proceeding with respect to Taxes. Buyer and Sellers shall
      preserve and cause to be preserved all information, returns, books, records
      and
      documents relating to any liabilities for Taxes with respect to a taxable period
      until the later of the expiration of all applicable statutes of limitation
      and
      extensions thereof, or the conclusion of all litigation with respect to Taxes
      for such period.

     

    7.8  Payroll
      Tax.
      Buyer
      and Sellers shall, to the extent that the Company is disregarded for such
      purposes (with respect to employees of the Company) and to the extent possible,
      treat Buyer as a “successor
      employer”
and
      Sellers as a “predecessor,”
within
      the meaning of IRC Sections 3121(a)(1) and 3306(b)(1), for purposes of Taxes
      imposed under the United States Federal Unemployment Tax Act or the United
      States Federal Insurance Contributions Act. Buyer and Sellers agree to take
      all
      reasonable actions so as to utilize the “Alternate
      Procedure”
      described in Section 5 of Revenue Procedure 2004-53 if applicable for wage
      reporting purposes. Each of Buyer and Sellers shall cooperate in good faith
      to
      adopt similar procedures under applicable state, municipal, county, local,
      foreign or other laws.

     

    7.9  Termination
      of Tax Sharing Agreements.
      All Tax
      sharing agreements, arrangements, policies and guidelines, whether formal or
      informal, express or implied, oral or written, to which the Company or Sellers
      are a party and all obligations of the Company thereunder shall be terminated
      with respect to the Company and applicable to all Post-Closing Periods, and
      on
      the Closing Date the Company shall have no further liability or obligations
      thereunder with respect to all Post-Closing Periods.

     

    8.  GENERAL
      PROVISIONS

     

    8.1  No
      Reliance on Other Information.
      Except
      for the representations and warranties contained in this Agreement, neither
      Sellers nor any Representative or Affiliate or other Person acting for any
      of
      them makes any other representation or warranty, express or implied, with
      respect to the Company, its assets, liabilities, business, financial condition
      or prospects, the Securities, any forecasts or projections provided to Buyer
      or
      the execution, delivery or performance by Sellers of this Agreement or with
      respect to the Contemplated Transactions, and Sellers hereby disclaim any such
      representation or warranty, whether oral or written, whether by Sellers or
      any
      of their Representatives or Affiliates or any other Person. Buyer acknowledges
      that none of the Sellers or any other Person has made any representation or
      warranty, express or implied, as to the accuracy or completeness of any
      information regarding the Company not included in this Agreement or the
      Disclosure Letter, and neither Sellers nor any other Person will have or be
      subject to any liability to Buyer or any other Person resulting from the
      distribution to Buyer, or Buyer’s use of, any such information (including,
      without limitation, any brochures, offering memoranda or other publications
      distributed in connection with the sale of the Securities or in any presentation
      by the management of the Company and any estimates of anticipated performance
      of
      the Company).

     

    8.2  Expenses.
      Except
      as otherwise expressly provided in this Agreement, each party to this Agreement
      will bear its respective expenses incurred in connection with the preparation,
      execution, and performance of this Agreement and the Contemplated Transactions,
      including all fees and expenses of agents, representatives, counsel, and
      accountants. Sellers will be responsible for the $500 landlord fee to consent
      to
      an assignment of the lease agreement between Mack-Cali Realty, L.P. and Dental
      Concepts LLC dated December 6, 1999, as amended by First Amendment to Lease
      Commencement Date Agreement dated May 18, 2003, as amended by Second Amendment
      to Lease dated March 28th,
      2003.

     

    8.3  Survival.
      Except
      as otherwise expressly provided herein, all of the representations, warranties,
      covenants and agreements of the parties hereto shall survive the execution
      and
      delivery of this Agreement and the Closing Date, and shall in no way be affected
      by any investigation of the subject matter thereof made by or on behalf of
      any
      other party. The representations and warranties contained in Sections 3.13
      (Taxes) and 3.15 (Employee Benefits) shall survive for the period of the
      applicable statute of limitations (with extensions granted by, or with the
      consent of, Sellers) with respect to the matters addressed in such sections;
      and
      all other representations and warranties shall expire eighteen (18) months
      following the Closing Date (collectively, the “Survival
      Period”).
      The
      termination of the representations and warranties provided herein shall not
      affect the rights of a party in respect of any claim made by such party in
      a
      writing received by the other party prior to the expiration of the applicable
      survival period provided herein.

     

    8.4  Public
      Announcements.
      Any
      press release with respect to this Agreement or the Contemplated Transactions
      will be issued, if at all, at such time and in such manner as Buyer determines.
      

     

    8.5  Notices.
      All
      notices, consents, waivers, and other communications under this Agreement must
      be in writing and will be deemed to have been duly given when (a) delivered
      by
      hand (with written confirmation of receipt), (b) sent by telecopier (with
      written confirmation of receipt), provided that a copy is mailed by registered
      mail, return receipt requested, or (c) when received or refused by the
      addressee, if sent by a nationally recognized overnight delivery service
      (receipt requested), in each case to the appropriate addresses and telecopier
      numbers set forth below (or to such other addresses and telecopier numbers
      as a
      party may designate by notice to the other parties):

     

    If
      to
      Sellers or Sellers’ Agent:

     

    Hamilton
      Investment Partners

     

    375
      Park
      Ave., Ste. 3407

     

    New
      York,
      New York 10152

     

    Attention:
      Doug Hamilton, Managing Partner

     

    Facsimile
      No.: 646-285-0347

     

    If
      to
      Buyer:

     

    Prestige
      Brands Holdings, Inc.

     

    90
      North
      Broadway

     

    Irvington,
      New York 10533

     

    Attention:
      Peter C. Mann

     

    Facsimile
      No.: 914-524-6802

     

    with
      a
      copy to:

     

    Prestige
      Brands Holdings, Inc.

     

    90
      North
      Broadway

     

    Irvington,
      New York 10533

     

    Attention:
      Charles N. Jolly

     

    Facsimile
      No.: 914-524-6812

     

    8.6  Jurisdiction;
      Service of Process.
      Any
      action or Proceeding seeking to enforce any provision of, or based on any right
      arising out of, this Agreement may be brought against any of the parties in
      the
      courts of the State of New York, or, if it has or can acquire jurisdiction,
      in
      the United States District Court for the Southern District of New York, and
      each
      of the parties consents to the jurisdiction of such courts (and of the
      appropriate appellate courts) in any such action or Proceeding and waives any
      objection to venue laid therein. Process in any action or Proceeding referred
      to
      in the preceding sentence may be served on any party anywhere in the
      world.

     

    8.7  Further
      Assurances.
      The
      parties agree (a) to furnish upon request to each other such further
      information, (b) to execute and deliver to each other such other documents,
      and
      (c) to do such other acts and things, all as the other party may reasonably
      request for the purpose of carrying out the intent of this Agreement and the
      documents referred to in this Agreement.

     

    8.8  Waiver.
      The
      rights and remedies of the parties to this Agreement are cumulative and not
      alternative. Neither the failure nor any delay by any party in exercising any
      right, power, or privilege under this Agreement or the documents referred to
      in
      this Agreement will operate as a waiver of such right, power, or privilege,
      and
      no single or partial exercise of any such right, power, or privilege will
      preclude any other or further exercise of such right, power, or privilege or
      the
      exercise of any other right, power, or privilege. To the maximum extent
      permitted by applicable law, (a) no claim or right arising out of this Agreement
      or the documents referred to in this Agreement can be discharged by one party,
      in whole or in part, by a waiver or renunciation of the claim or right unless
      in
      writing signed by the other party; (b) no waiver that may be given by a party
      will be applicable except in the specific instance for which it is given; and
      (c) no notice to or demand on one party will be deemed to be a waiver of any
      obligation of such party or of the right of the party giving such notice or
      demand to take further action without notice or demand as provided in this
      Agreement or the documents referred so in this Agreement.

     

    8.9  Entire
      Agreement and Modification.
      This
      Agreement supersedes all prior agreements between the parties with respect
      to
      its subject matter (including the Letter of Intent between Buyer and Sellers
      dated September 14, 2005) and constitutes (along with the documents referred
      to
      in this Agreement) a complete and exclusive statement of the terms of the
      agreement between the parties with respect to its subject matter. This Agreement
      may not be amended except by a written agreement executed by the party to be
      charged with the amendment.

     

    8.10  Disclosure
      Letter.
      In the
      event of any inconsistency between the statements in the body of this Agreement
      and those in the Disclosure Letter, the statements in the Disclosure Letter
      will
      control.

     

    8.11  Assignments,
      Successors and Third-Party Rights.
      Neither
      party may assign any of its rights under this Agreement without the prior
      consent of the other parties (in the case of Buyer, this agreement may not
      be
      assigned by Buyer without the prior written consent of Sellers’ Agent), except
      that Buyer may assign any of its rights under this Agreement to any Subsidiary
      of Buyer, provided that Buyer shall remain liable for all of its obligations
      pursuant to this Agreement notwithstanding any such assignment. Subject to
      the
      preceding sentence, this Agreement will apply to, be binding in all respects
      upon, and inure to the benefit of the successors and permitted assigns of the
      parties. Except as otherwise provided for in this Agreement, (a) nothing
      expressed or referred to in this Agreement will be construed to give any Person
      other than the parties to this Agreement any legal or equitable right, remedy,
      or claim under or with respect to this Agreement or any provision of this
      Agreement, and (b) this Agreement and all of its provisions and conditions
      are
      for the sole and exclusive benefit of the parties to this Agreement and their
      successors and assigns. Anything to the contrary herein 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    notwithstanding,
      Sellers hereby acknowledge and consent to any collateral assignment of Buyer’s
      rights and interest under this Agreement and any Transaction Documents to
      Buyer’s secured lenders.

     

    8.12  Severability.
      If any
      provision of this Agreement is held invalid or unenforceable by any court of
      competent jurisdiction, the other provisions of this Agreement will remain
      in
      full force and effect. Any provision of this Agreement held invalid or
      unenforceable only in part or degree will remain in full force and effect to
      the
      extent not held invalid or unenforceable.

     

    8.13  Section
      Headings, Construction.
      The
      headings of Sections in this Agreement are provided for convenience only and
      will not affect its construction or interpretation. All references to “Section”
or “Sections” refer to the corresponding Section or Sections of this Agreement.
      All words used in this Agreement will be construed to be of such gender or
      number as the circumstances require. Unless otherwise expressly provided, the
      word “including” does not limit the preceding words or terms. All references to
      the directors of the Company or Sellers shall be deemed also to be references
      to
      the managers of the Company or Sellers, as applicable.

     

    8.14  Time
      of Essence.
      With
      regard to all dates and time periods set forth or referred to in this Agreement,
      time is of the essence.

     

    8.15  Governing
      Law.
      This
      Agreement will be governed by the laws of the State of Delaware without regard
      to conflicts of laws principles.

     

    8.16  Counterparts.
      This
      Agreement may be executed in one or more counterparts, each of which will be
      deemed to be an original copy of this Agreement and all of which, when taken
      together, will be deemed to constitute one and the same agreement.

     

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SIGNATURE
      PAGE TO UNIT PURCHASE AGREEMENT

     

    IN
      WITNESS WHEREOF, the parties have executed and delivered this Agreement as
      of
      the date first written above.

     

     

    
       

      
        	 	
                BUYER

              
	 	 
	 	
                PRESTIGE
                  BRANDS HOLDINGS, INC.

              
	 	 
	 	
                By: 
                  /s/ Peter C. Mann   

              
	 	
                Name: 
                  Peter C. Mann

              
	 	
                Title: 
                  CEO

              

      

      

      
        	 	
                COMPANY

                 

                DENTAL
                  CONCEPTS, LLC

              
	 	 
	 	
                By: 
                  /s/ Michael Lesser 

              
	 	
                Name: 
                  Michael Lesser   

              
	 	
                Title: 
                  CEO

              

      

      

      
        	 	
                SELLERS

              
	 	 
	 	 /s/
                Michael Lesser
	 	
                MICHAEL
                  LESSER

              
	 	 
	 	 /s/
                Richard Gaccione
	 	
                RICHARD
                  GACCIONE

              
	 	 
	 	 /s/
                Gordon Wade
	 	
                COMBINED
                  CONSULTANTS DBPT

              
	 	
                GORDON
                  WADE

              
	 	 
	 	 /s/
                Douglas A.P. Hamilton
	 	
                DOUGLAS
                  A.P. HAMILTON

              

      

      

      
        	 	 
	 	 /s/
                George O'Neill
	 	
                GEORGE
                  O’NEILL

              
	 	 
	 	 /s/
                Abby O'Neill
	 	
                ABBY
                  O’NEILL

              
	 	 
	 	 /s/
                Michael Porter
	 	
                MICHAEL
                  PORTER

              
	 	 
	 	 /s/
                Marc Cole
	 	
                MARC
                  COLE

              

      

      

      

      
        	 	
                ISLANDIA
                  LP

              
	 	 
	 	
                By: 
                  /s/ Islandia LP

              
	 	
                 

              
	 	
                 

              

      

      

      

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

           

          EXHIBITS
            AND SCHEDULES OMITTED<PAGE>
                                                                   EXHIBIT 10.11

                              EMPLOYMENT AGREEMENT

         Employment Agreement (the "Agreement"), dated as hereinafter indicated
to be effective on February 15, 2001 (the "Effective Date"), by and between
e-dentist.com, Inc., a Delaware corporation (the "Company"), and James Dunn, Jr.
("Employee").

         WHEREAS, the parties hereto had entered into that certain Employment
Agreement, dated July 12, 1997 as amended on April 22, 1998, among the Company
and Employee (the "Prior Agreement"); and,

         WHEREAS, the Company and Employee wish to continue the employment of
Employee on the terms and conditions described herein with this Agreement
superceding and wholly replacing the Prior Agreement including subsequent
Amendments in its entirety;

         NOW THEREFORE, in consideration of the mutual premises and conditions
contained herein, the parties hereto agree as follows:

         Section 1. EMPLOYMENT. The Company hereby agrees to employ Employee,
and Employee hereby accepts employment by the Company, upon the terms and
subject to the conditions hereinafter set forth.

         Section 2. DUTIES. Employee shall serve as the Senior Vice President,
General Counsel and Chief Development Officer of the Company (the "Position")
reporting to the Company's President. Employee's duties and powers shall be
those consistent with the office of the Position, with such additional duties or
titles as mutually determined necessary or appropriate from time to time by the
Company's President. Employee agrees to devote his full time and best efforts to
the Company in the performance of his duties. All of the Employee's powers and
authorities shall be subject to the reasonable direction and control of the
President. Employee acknowledges that the executive offices of the Company will
be located in Phoenix, Arizona and he shall perform his duties under this
Agreement from those executive offices.

         Section 3. TERM. Except as otherwise provided in Section 6 hereof, the
term of this Agreement shall be for two (2) years ("Term"), beginning on the
Effective Date (also referred to as the "Commencement Date"). Unless and until
terminated as provided for in Section 6, this Agreement shall automatically
extend and renew on each annual anniversary of the Effective Date by adding one
(1) year to the Term from year to year until terminated.

         Section 4. COMPENSATION AND BENEFITS. In consideration for the services
of the Employee hereunder, the Company will compensate Employee as follows:

                 (a) BASE SALARY. During the Term of this Agreement and until
        terminated, Employee shall receive a monthly MINIMUM base salary (the
        "Base Salary") equal to the greater of: (i) twelve thousand five hundred
        and 00/100 dollars ($12,500.00) per month; or (ii) such amount as
        determined by the President in writing. Employee's Base Salary shall be
        paid in accordance with Company's standard policy regarding payment of
        compensation to employees but no less frequently than monthly.

<PAGE>

                  (b) BONUS. Commencing with the fiscal year beginning April 1,
         2000 and continuing from year to year until this Agreement is
         terminated, Employee shall be eligible to receive a cash bonus each
         year during the term of this Agreement determined in accordance with
         the Management Incentive Compensation Plan as amended from time to
         time, a copy of which is attached as Exhibit "A". Such bonus shall be
         payable by the Company to Employee as provided for in the Management
         Incentive Compensation Plan.

                  (c) BENEFITS. The Company shall grant Employee options to
         purchase shares of the Company's Common Stock in such amounts, with
         such vesting and at such prices as determined by the President all in
         accordance with the terms of a Stock Option Agreement, and in the
         general form of option agreement attached as Exhibit "B". In addition,
         during the term of this Agreement, Employee shall be allowed to
         participate in, and be entitled to benefits, plans and programs,
         including improvements or modifications of the same, which are now, or
         may hereafter be, those available to officers or employees of a like
         position ("Executives"). Employee shall be entitled to medical, dental
         and retirement benefits which are generally made available to
         Executives, provided further that Employer will pay the total premium
         costs associated with the medical and dental insurance, not including
         deductibles and/or co-payments, covering the health of Employee,
         Employee's spouse and Employee's dependants. Medical, dental and
         disability insurance already effective shall remain in force, or if not
         shall become effective on the first day of the month following the
         Commencement Date. During each year of his employment Employee shall be
         entitled to three (3) weeks of vacation, and such other days of
         compensated absences, (i.e. sick leave or personal days) in accordance
         with the Company's policies and procedures as determined from time to
         time by the President.

         Section 5. EXPENSES. It is acknowledged by the parties that Employee,
in connection with the services to be performed by him pursuant to the terms of
this Agreement, will be required to make payments for travel, entertainment of
business associates, mobile telephone and similar expenses (the "Out of Pocket
Expenses"). The Company will reimburse Employee for all reasonable and necessary
Out of Pocket Expenses incurred by Employee in the performance of his duties.
Employee will comply with such budget limitations, approval and reporting
requirements with respect to such Out of Pocket Expenses as the Company may
establish from time to time. The Company Prior to execution of this Agreement
will obtain and maintain, for so long as Employee is employed by the Company and
provides legal services to the Company, legal malpractice insurance which will
indemnify and protect Employee and Employer from claims by persons that Employee
committed errors, omissions, or malpractice during the delivery of legal
services to the Company or any other person. The premiums associated with such
malpractice insurance shall be paid by the Company. The Company may select the
insurance carrier provided that the policy limits meet or exceed existing policy
terms and limits and the insurance covers claims which occur while Employee is
associated with the Company. Upon termination of this Agreement, Employee shall
be permitted to obtain tail coverage if available from the insurance carrier.
The Company agrees to provide notice to Employee if that malpractice insurance
is going to be canceled or lapse. In the event that the Company relocates its
corporate offices or Employee is asked to move to other corporate offices
outside of the Phoenix, Arizona area, then Employee shall be entitled to
reimbursement of the costs of relocation described on Exhibit "C".

         Section 6. TERMINATION. Employee's employment hereunder will commence
on the Commencement Date and continue until the end of the Term including any
renewals thereof, except that the employment of Employee hereunder will
terminate upon the occurrence of the following events:

                  (a) Death or Disability. Employee's employment will terminate
         immediately upon the death of Employee during the term of his
         employment hereunder or, at the option of the Company, in the event of

<PAGE>

         Employee's disability, upon 30 days notice to Employee. Employee will
         be deemed "disabled" if, as a result of Employee's incapacity due to
         physical or mental illness, Employee shall have been continuously
         absent from his duties with the company on a full-time basis for 120
         consecutive business days, and Employee shall not reasonably be
         expected to be able to resume his duties within 60 days of the end of
         such 120 day period. In the event of the termination of this Agreement
         pursuant to this subsection 6(a), Employee will not be entitled to any
         Severance Amount (as hereinafter defined) or other compensation except
         for any portion of his base salary accrued but unpaid from the last
         monthly payment date to the date of termination and expense
         reimbursements under Section 5 hereof or for expenses incurred in the
         performance of his duties hereunder prior to termination.

                  (b) For Cause. The Company may terminate the Employee's
         employment for "Cause" immediately upon written notice by the Company
         to Employee. For purposes of this Agreement, a termination will be for
         Cause if: (i) Employee willfully and continuously fails to perform his
         duties with the Company (other than any such failure resulting from
         incapacity due to physical or mental illness); (ii) Employee willfully
         engages in gross misconduct materially and demonstrably injurious to
         the Company; or (iii) Employee has been convicted of a felony which the
         President reasonably believes will result in injury to the Company or
         which would disqualify employee for coverage by the Company's surety
         bond. IN the event of the termination of this Agreement pursuant to
         this sub-section 6(b), Employee will not be entitled to any Severance
         Amount (as hereinafter defined) or further consideration, except for
         any portion of the base salary accrued but unpaid from the last monthly
         payment date to the date of Termination and expense reimbursements
         under Section 5 hereof for expenses incurred in the performance of his
         duties hereunder prior to termination.

                  (c) By Company Without Cause. The Company may terminate this
         Agreement during the Term at any time for any reason without cause. It
         shall be deemed a termination without cause if Company changes the
         Position of Employee without Employee's prior written consent. In the
         event of the termination of this Agreement pursuant to this subsection,
         the Company will pay Employee, as Employee's sole remedy in connection
         with such termination, severance in the amount determined by
         multiplying Employee's monthly base salary at the rate in effect
         immediately preceding the termination of Employee's employment by
         twelve (12) months (the "Severance Amount"). The Company will also pay
         Employee the portion of his base salary accrued but unpaid from the
         last monthly payment date to the date of termination and expense
         reimbursements under Section 5 hereof for expenses incurred in the
         performance of his duties hereunder prior to termination. The Company
         will pay the Severance Amount in a lump sum and within thirty (30) days
         of the Employee's last day of employment. The Company will not be
         entitled to offset or mitigate the amount due under this subsection by
         any other amounts payable to Employee, including amounts payable or
         paid to Employee by third parties for Employee's services after the
         date of termination, except as provided for otherwise in Section 10(b)
         hereinafter.

                  (d) CHANGE OF CONTROL. Notwithstanding anything to the
         contrary contained in this Section 6, in the event Employee's
         employment with the Company terminates for any reason (other than death
         or disability) within the twelve (12) month period following a Change
         of Control (as defined hereafter), then the Company will pay Employee a
         lump sum payment (the "Termination Payment") in cash equal to the
         amount of the Severance Amount; plus, the amount of Employee's base
         salary accrued but unpaid and any expense reimbursement for expenses
         incurred in the performance of the duties described herein prior to the
         termination date. A "Change of Control" shall be deemed to have
         occurred: (i) when in a single transaction or a series

<PAGE>

         of transactions a change of stock ownership of the Company of a nature
         that would be required to be reported in response to Item 6(e) of
         Schedule 14A promulgated under the Securities Exchange Act of 1934, as
         amended (the "Exchange Act"), and any successor item of a similar
         nature has occurred; or (ii) upon the acquisition of beneficial
         ownership, directly or indirectly, by any person (as such term is used
         in Section 13(d) and 14(d)(2) of the Exchange Act of securities of the
         Company) in a single transaction or a series of transactions
         representing 33% or more of the combined voting power of the Company's
         then outstanding securities; or (iii) sale of substantially all of the
         assets of the Company in a single transaction or a series of
         transactions; or (iv) removal by the Company from the Position
         identified herein without Employee's prior written consent ; provided
         that a Change in Control will not be deemed to have occurred for
         purposes of clauses (i) and (ii) hereof with respect to any person
         meeting the requirements of Rule 13d-1(b)(1) promulgated under the
         Securities Exchange Act of 1934, as amended. The Company shall pay the
         Termination Payment to Employee upon written notice by Employee. The
         Termination Payment due under this Section will not be affected by the
         manner in which Employee's employment is terminated and accordingly
         will be whether the Change of Control occur after termination of this
         Agreement and whether Employee's termination of employment is
         voluntary, involuntary, for cause, or without cause.

         Section 7. EFFECT OF TERMINATION ON OPTIONS. If Employee is terminated
"for cause" under Section 6(b) above, then the effect of the termination of the
Employee's employment on such options shall be determined by the terms of the
option plan under which the options are issued and the option agreement related
to such options, except that Employee shall retain those options which are
already vested and shall have ninety (90) days to exercise those vested options.
Notwithstanding anything to the contrary herein or in any option agreement, in
the event of: (a) a Change of Control, or (b) termination of this Agreement for
any reason (except if "for cause"), then the Options issued and outstanding to
Employee shall immediately vest (100%), and the Employee may exercise his
options at any time during the original term of the option agreement (as defined
therein), and such termination of this Agreement shall not cause termination or
expiration of the options.

         Section 8. CONFIDENTIAL INFORMATION. Employee recognizes and
acknowledges that certain assets of the Company and its affiliates, including
without limitation information regarding customers, pricing policies, methods of
operation, proprietary computer programs, sales, products, profits, costs,
markets, key personnel, formulae, product applications, technical processes, and
trade secrets (herein called "Confidential Information") are valuable, special
and unique assets of the Company and its affiliates. Employee will not, during
or after the term of his employment, disclose any of the Confidential
Information to any person, firm, corporation, association, or any other entity
for any reason or purpose whatsoever, directly or indirectly, except as may be
required pursuant to his employment hereunder, unless and until such
Confidential Information becomes publicly available other than as a consequence
of the breach by Employee of his confidentiality obligations hereunder. In the
Event of the termination of his employment, whether voluntary or involuntary,
and whether by the Company or Employee, Employee will deliver to the Company all
documents and data pertaining to the Confidential Information and will not take
with him any documents or data of any kind or any reproductions (in whole or in
part) of any items relating to the Confidential Information.

         Section 9. NONCOMPETITION. Until one year after termination of
Employee's employment with the Company for any reason, whether voluntary or
involuntary, Employee will not: (i) engage directly or indirectly, alone or as a
shareholder, partner, officer, director, employee or consultant of any other
business organization, in any business activities which are directly competitive
with the Company and which were either conducted by the Company at the time of
Employee's termination or "Proposed to be Conducted" (as defined herein) by the
Company at the time of such termination (the "Designated Industry"); (ii) divert

<PAGE>

to any competitor of the Company in the Designated Industry any customer of
Employee or, (iii) solicit or encourage any officer, employee, or consultant of
the Company to leave its employ for employment by or with any competitor of the
Company in the Designated Industry. The parties hereto acknowledge that
Employee's non-competition obligations hereunder will not preclude Employee from
(i) owning less than 5% of the common stock of any publicly traded corporation
conducting business activities in the Designated Industry or (ii) serving as an
officer, director, stockholder or employee of an entity engaged in the
healthcare industry whose business operations are not competitive with those of
the Company. "Proposed to be Conducted," as used herein, shall mean those
business activities which are the subject of a formal, written business plan
approved by the Board of Directors prior to termination of Employee's employment
and which the Company takes material action to implement within 12 months of the
termination of Employee's employment. Employee will continue to be bound by the
provisions of this Section 9 until their expiration and will not be entitled to
any compensation from the Company with respect thereto. If at any time the
provisions of this Section 9 are determined to be invalid or unenforceable, by
reason of being vague or unreasonable as to area, duration or scope of activity,
this Section 9 will be considered divisible and will become and be immediately
amended to only such area, duration, scope of activity as will be determined to
be reasonable and enforceable by the court or other body having jurisdiction
over the matter; and Employee agrees that this Section 9 as so amended will be
valid and binding as though any invalid or unenforceable provision had not been
included herein.

         Section 10. GENERAL.

                  (a) NOTICES. All notices and other communications hereunder
         will be in writing or by written telecommunication, and will be deemed
         to have been duly given if delivered personally or if mailed by
         certified mail, return receipt requested or by written
         telecommunication, to the relevant address set forth below, or to such
         other address as the recipient of such notice or communication will
         have specified to the other party hereto in accordance with this
         Section 10(a):

        If to the Company, to:           With a copy to:

        e-dentist.com, Inc.              Jackson Walker, L.L.P.
        2999 N. 44th Street, Suite 650   901 Main Street, Suite 6000
        Phoenix, Arizona 85018           Dallas, Texas  75202Attn:
        Attn: CHIEF EXECUTIVE OFFICER    James S. Ryan, III
        Fax No.: (602) 952-0544          Fax No. (214) 953-5822

        If to Employee, to:
        James Dunn Jr.
        6902 East Evans
        Scottsdale, AZ 85254

                  (b) WITHHOLDING AND OFFSET. All payments required to be made
         by the Company under this Agreement to Employee will be subject to the
         withholding of such amounts, if any, relating to federal, state and
         local taxes as may be required by law. No payment under this Agreement
         will be subject to offset or reduction attributable to any amount
         Employee may owe to the Company or any other person.

                  (c) EQUITABLE REMEDIES. Each of the parties hereto
         acknowledges and agrees that upon any breach by Employee of his
         obligations under any of the Sections 8 and 9 hereof, the Company will
         have no adequate remedy at law, and accordingly will be entitled to
         specific performance and other appropriate injunctive and equitable
         relief.

<PAGE>

                  (d) SEVERABILITY. If any provision of this Agreement is held
         to be illegal, invalid or unenforceable, such provision will be fully
         severable and this Agreement will be construed and enforced as if such
         illegal, invalid or unenforceable provision never comprised a part
         hereof; and the remaining provisions hereof will remain in full force
         and effect and will not be affected by the illegal, invalid or
         unenforceable provision or by its severance herefrom. Furthermore, in
         lieu of such illegal, invalid or unenforceable provision, there will be
         added automatically as part of this Agreement a provision as similar in
         its terms to such illegal, invalid or unenforceable provision as may be
         possible and be legal, valid and enforceable. Any and all covenants and
         obligations of either party hereto which by their terms or by
         reasonable implication are to be performed, in whole or in part, after
         the termination of this Agreement, shall survive such termination,
         including specifically the obligations arising under Sections: 6, 7, 8
         and 9.

                  (e) WAIVERS. No delay or omission by either party hereto in
         exercising any right, power or privilege hereunder will impair such
         right, power or privilege, nor will any single or partial exercise of
         any such right, power or privilege preclude any further exercise
         thereof or the exercise of any other right, power or privilege.

                  (f) COUNTERPARTS. This Agreement may be executed in multiple
         counterparts, each of which will be deemed an original, and all of
         which together will constitute one and the same instrument.

                  (g) CAPTIONS. The captions in this Agreement are for
         convenience of reference only and will not limit or otherwise affect
         any of the terms or provisions hereof.

                  (h) REFERENCE TO AGREEMENT. Use of the words "herein,"
         "hereof;" "hereto " and the like in this Agreement refer to this
         Agreement only as a whole and not to any particular subsection or
         provision of this Agreement, unless otherwise noted.

                  (i) BINDING AGREEMENT. This Agreement will be binding upon and
         inure to the benefit of the parties and will be enforceable by the
         personal representatives and heirs of Employee and the successors of
         the Company. If Employee dies while any amounts would still be payable
         to him hereunder, such amounts will be paid to Employee's estate. This
         Agreement is not otherwise assignable by Employee.

                  (j) ENTIRE AGREEMENT. Except as provided in the benefit plans
         and programs referenced herein, this Agreement contains the entire
         understanding of the parties, supersedes all prior agreements and
         understandings relating to the subject matter hereof and may not be
         amended except by a written instrument hereafter signed by each of the
         parties hereto.

                  (k) GOVERNING LAW. This Agreement and the performance hereof
         will be construed and governed in accordance with the laws of the State
         of Arizona, without regard to its choice of law principles. Any
         modification of this Agreement shall be effective only if it is in
         writing and signed by the parties hereto.

                  (1) ATTORNEY'S FEES. If legal action is commenced by either
         party to enforce or defend its rights under this Agreement, the
         prevailing party in such action shall be entitled to recover its costs
         and reasonable attorneys' fees in addition to any other relief granted.
         If either party commences legal action or arbitration to enforce or

<PAGE>

         defend its rights under this Agreement, the prevailing party in such
         action shall be entitled to recover its costs, including travel,
         lodging and meals for itself, counsel and witnesses, actual witness
         fees paid and legal fees actually paid, including costs of associating
         local counsel with regular counsel, if actually paid.

         Section 11. BINDING ARBITRATION. Any controversy or claim arising out
of or relating to this Agreement, or breach thereof, shall be settled
exclusively by arbitration in Phoenix, Arizona, in accordance with the
Commercial Arbitration Rules of the American Arbitration Association then in
effect. A sole arbitrator shall conduct Arbitration and he or she shall render
his or her award within forty five (45) days of appointment. Judgment upon the
award rendered by the arbitrator may be entered in, and enforced by, any court
having jurisdiction thereof. The award of the arbitrator may grant any relief
available to the parties in law or in equity; and the award may contain a
provision for payment of costs and attorney's fees to the prevailing party, if
any.

<PAGE>

EXECUTED as of the date and year first written above.

                                        e-dentist.com, inc.

                                        By: /s/James M. Powers, Jr.
                                            --------------------------
                                        Its: President
                                             -------------------------

                                        EMPLOYEE:

                                        /s/James Dunn Jr.
                                        -----------------------------
                                        James Dunn Jr.

                                        Date: February 16, 2001
                                              -----------------------

<PAGE>

                     Amendment No. 3 to Employment Agreement
                                       Of
                               James L. Dunn, Jr.

         This amendment (the "Third Amendment") to that employment agreement
dated February 15, 2001 (the "Employment Agreement"), by and between iLinc
Communications, Inc. (formerly EDT Learning, Inc.), a Delaware corporation (the
"Company"), and James Dunn, Jr. ("Employee") with this amendment being effective
on December 15, 2005 (the "Effective Date").

         Whereas, Employee wishes to modify the Employment Agreement to provide
for his continued employment with the Company, but provided for his ability to
live in Texas outside the corporate headquarters in Phoenix, Arizona; and,

         Whereas, the Company wishes to retain the services of Employee and
continue to receive the benefit of his services, whether or not residing in
Arizona;

         Now Therefore, in exchange for the mutual promises contained in the
Employment Agreement and this Amendment, the Company and Employee agree as
follows:

         1.       The prior amendment to Employee's Agreement dated July 16,
                  2003 (the "First Amendment") and the prior amendment to
                  Employee's Agreement dated to be effective June 1, 2004 (the
                  "Second Amendment") shall upon execution of this Third
                  Amendment be terminated and have no further effect.

         2.       The terms of his Employment Agreement shall be modified as
                  follows:

                  a. The following shall be added to the end of Section 2
                  (Duties):

                  "Notwithstanding the foregoing Employee may work from a remote
                  office in Texas away from the Company's corporate
                  headquarters."

                  b. The following sentence shall be added as Subsection (b) of
                  Section 10 (Withholding and Offset):

                  "While this Agreement remains in effect and when Employee is a
                  resident of Texas, Employee shall not work for any third party
                  (i.e., moonlighting is prohibited), and furthermore should
                  Employee work for a third party other than Company, then the
                  Company shall be entitled to offset any compensation due
                  hereunder by the amount of any compensation paid to Employee
                  from that third party employer."

                  c. The following shall be added to the end of Subsection (c)
                  of Section 6 (Termination):

                  "Provided further that should a Change of Control occur and
                  Employee obtain employment with the successor organization in
                  a comparable position, then the Company shall not be
                  responsible for payment of the Severance Amount."

<PAGE>

         All other provisions of the Employment Agreement of Employee shall
remain unchanged and in full force and effect.

        iLinc Communications, Inc.                 Employee:

        By: /s/ James M. Powers, Jr.               /s/ James L. Dunn, Jr.
            -----------------------                --------------------------
            James M. Powers, Jr.                       James L. Dunn, Jr.
            President

        Date:  1/11/06                             Date:  1/11/06
             ----------------------                      --------------------

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