-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, R43t0yz+thVaAWv7nyErdqWjqzP3WcT05y/cxNWD9TDi1tku0IGpOUm2nAGc7ySF t1hpJXEzkvm1A03CO7Uv4g== 0001104659-05-054182.txt : 20051109 0001104659-05-054182.hdr.sgml : 20051109 20051109173447 ACCESSION NUMBER: 0001104659-05-054182 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20050930 FILED AS OF DATE: 20051109 DATE AS OF CHANGE: 20051109 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BRUKER BIOSCIENCES CORP CENTRAL INDEX KEY: 0001109354 STANDARD INDUSTRIAL CLASSIFICATION: LABORATORY ANALYTICAL INSTRUMENTS [3826] IRS NUMBER: 043110160 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-30833 FILM NUMBER: 051191281 BUSINESS ADDRESS: STREET 1: 40 MANNING RD CITY: BILLERICA STATE: MA ZIP: 01821 MAIL ADDRESS: STREET 1: 40 MANNING RD CITY: BILLERICA STATE: MA ZIP: 01821 FORMER COMPANY: FORMER CONFORMED NAME: BRUKER DALTONICS INC DATE OF NAME CHANGE: 20000315 10-Q 1 a05-18563_110q.htm QUARTERLY REPORT PURSUANT TO SECTIONS 13 OR 15(D)

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)
ý		QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2005

o		TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		FOR THE TRANSITION PERIOD FROM TO

Commission File Number 000-30833

Bruker BioSciences Corporation

(Exact name of registrant as specified in its charter)

DELAWARE		04-3110160
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

40 Manning Park

Billerica, MA 01821

(Address of principal executive offices)

(978) 663-3660

(Registrant’s telephone number, including area code)

Indicate by checkmark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ý Yes o No

Indicate by checkmark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). ý Yes o No

Indicate by checkmark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2). Yes o No ý

As of November 7, 2005, there were 89,498,976 shares of the Registrant’s common stock outstanding.

Bruker BioSciences Corporation

Form 10-Q

For the Quarter Ended September 30, 2005

Index

PART I	FINANCIAL INFORMATION
ITEM 1:	Financial Statements:
	Condensed Consolidated Balance Sheets as of September 30, 2005 and December 31, 2004
	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2005 and 2004
	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2005 and 2004
	Notes to Condensed Consolidated Financial Statements
ITEM 2:	Management’s Discussion and Analysis of Financial Condition and Results of Operations
ITEM 3:	Quantitative and Qualitative Disclosures about Market Risk
ITEM 4:	Controls and Procedures
PART II	OTHER INFORMATION
ITEM 1:	Legal Proceedings
ITEM 2:	Unregistered Sales of Equity Securities and Use of Proceeds
ITEM 3:	Defaults Upon Senior Securities
ITEM 4:	Submission of Matters to a Vote of Security Holders
ITEM 5:	Other Information
ITEM 6:	Exhibits
	SIGNATURES

PART I FINANCIAL INFORMATION

ITEM 1: Financial Statements

Bruker BioSciences Corporation

Condensed Consolidated Balance Sheets

(in thousands, except share data)

	September 30		December 31,
	2005		2004
	(Unaudited)
ASSETS
Current assets:
Cash, cash equivalents and short-term investments	$	95,337	$	77,691
Accounts receivable, net	49,370		57,792
Due from affiliated companies	5,920		9,530
Inventories	99,309		107,748
Other current assets	13,103		18,530
Total current assets	263,039		271,291
Property, plant and equipment, net	73,472		84,990
Intangibles and other assets	14,835		15,266
Total assets	$	351,346	$	371,547

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term borrowings	$	10,960	$	12,205
Accounts payable	14,804		22,652
Due to affiliated companies	2,857		3,026
Customer advances	25,254		21,045
Other current liabilities	54,816		52,232
Total current liabilities	108,691		111,160

Long-term debt	21,821		27,763
Other long-term liabilities	13,915		15,349
Commitments and contingencies (Note 12)
Preferred stock, $0.01 par value, 5,000,000 shares authorized, none issued or outstanding at September 30, 2005 or December 31, 2004	—		—
Common stock, $0.01 par value, 150,000,000 shares authorized, 89,479,039 and 89,470,714 shares issued and outstanding at September 30, 2005 and December 31, 2004, respectively	895		895
Other stockholders’ equity	206,024		216,380
Total shareholders’ equity	206,919		217,275
Total liabilities and shareholders’ equity	$	351,346	$	371,547

See the accompanying notes to financial statements.

Bruker BioSciences Corporation

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(Unaudited)

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2005		2004			2005		2004
			(Restated)					(Restated)
Product revenue	$	61,061	$	58,412		$	188,609	$	174,707
Service revenue	8,748		7,430			26,479		22,855
Other revenue	928		635			1,928		1,217
Total revenue	70,737		66,477			217,016		198,779

Cost of product revenue	35,452		32,960			107,992		103,815
Cost of service revenue	4,866		4,570			16,681		14,205
Total cost of revenue	40,318		37,530			124,673		118,020

Gross Profit	30,419		28,947			92,343		80,759

Sales and marketing	11,845		12,952			37,382		38,816
General and administrative	5,677		5,257			16,632		14,515
Research and development	9,969		10,824			31,951		31,091
Total operating expenses	27,491		29,033			85,965		84,422
Operating income (loss)	2,928		(86		)	6,378		(3,663		)

Interest and other income (expense), net	577		(1,902		)	1,001		(2,768		)

Income (loss) before income tax provision and minority interest in consolidated subsidiaries	3,505		(1,988		)	7,379		(6,431		)

Income tax provision	2,398		955			5,468		395
Income (loss) before minority interest in consolidated subsidiaries	1,107		(2,943		)	1,911		(6,826		)
Minority interest in consolidated subsidiaries	28		115			131		145
Net income (loss)	$	1,079	$	(3,058	)	$	1,780	$	(6,971	)

Net income (loss) per common share - basic and diluted	$	0.01	$	(0.03	)	$	0.02	$	(0.08	)
Weighted average common shares outstanding:
Basic	89,476		89,456			89,473		88,156
Diluted	89,669		89,456			89,620		88,156

See the accompanying notes to financial statements.

Bruker BioSciences Corporation

Condensed Consolidated Statements of Cash Flows

(in thousands)

(Unaudited)

	Nine Months Ended
	September 30,
	2005			2004
				(Restated)
Operating activities:
Net cash provided by (used in) operating activities	$	25,578		$	(10,482	)

Investing activities:
Purchases of property and equipment	(2,172		)	(3,867		)
Purchases (redemptions) of short-term investments, net	105			(344		)
Changes in restricted cash	(142		)	—
Net cash used in investing activities	(2,209		)	(4,211		)

Financing activities:
Proceeds from short-term borrowings, net	272			6,012
Repayments of long-term debt, net	(3,616		)	(5,783		)
Proceeds from issuance of common stock	213			14,493
Net cash provided by (used in) financing activities	(3,131		)	14,722

Effect of exchange rate changes on cash	(2,592		)	(250		)
Net change in cash and cash equivalents	17,646			(221		)
Cash, cash equivalents and short-term investments at beginning of period	77,691			76,837
Cash, cash equivalents and short-term investments at end of period	$	95,337		$	76,616

See the accompanying notes to financial statements.

Bruker BioSciences Corporation

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1. Description of Business and Basis of Presentation

Bruker BioSciences Corporation and its wholly-owned subsidiaries (the “Company”) design, manufacture, service and market proprietary life science systems based on mass spectrometry core technology platforms and X-ray technology. The Company also distributes products and sells a broad range of field analytical systems for nuclear, biological and chemical (“NBC”) detection. The Company maintains major technical centers in Europe, North America and Japan. The Company’s diverse customer base includes pharmaceutical, biotechnology and proteomics companies, academic institutions, semiconductor industries and government agencies.

The financial statements represent the consolidated accounts of Bruker BioSciences Corporation and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The condensed consolidated financial statements as of and for the three and nine months ended September 30, 2005 and 2004 have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with Article 10 of Regulation S-X. The December 31, 2004 balance sheet is the balance sheet included in the audited financial statements as presented in the Company’s 2004 Annual Report on Form 10-K. Accordingly, the financial information presented herein does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included. The results for interim periods are not necessarily indicative of the results to be expected for the full year.

The Company reports financial results on the basis of two reportable segments; Bruker Daltonics and Bruker AXS. Bruker Daltonics is in the business of manufacturing and distributing mass spectrometry instruments that can be integrated and used along with other analytical instruments. Bruker AXS is primarily in the business of manufacturing and distributing advanced X-ray instrumentation used in non-destructive molecular and elemental analysis in academic, research and industrial applications.

For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004.

2. Restatement of Financial Statements

The Company has restated its previously issued consolidated financial statements for the three and nine months ended September 30, 2004. Certain costs historically classified in sales and marketing and research and development expense were reclassified to cost of product revenue. For the three and nine months ended September 30, 2004, approximately $2.1 million and $6.6 million, respectively, related to the write-down of demonstration inventory to net realizable value was reclassified from sales and marketing and research and development expense to cost of product revenue. The Company also made changes to the consolidated financial statements for the three and nine months ended September 30, 2004 increasing cost of product revenue by $0.3 million and $0.6 million, respectively, for accounting corrections related primarily to inventory costing identified during the 2004 year-end closing process. The accounting corrections identified during the 2004 year-end closing process impacted the Company’s U.S. operations resulting in no tax effect being recognized on these adjustments.

3. Stock Compensation Arrangements

The Company measures compensation expense for its stock-based employee compensation plans using the intrinsic value method in accordance with Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to Employees,” and FASB Interpretation No. 44, “Accounting for Certain Transactions involving Stock Compensation.” The Company has adopted the disclosure-only provisions of Statement of Financial Accounting Standards No. 148, “Accounting for Stock-Based Compensation – Transition and Disclosure”, an amendment of FASB Statement No. 123 (“SFAS 148”). Had compensation expense for the Company’s stock option plans been determined based on the fair value at the grant date, consistent with the methodology prescribed by SFAS 148, the Company’s net income (loss) and net income (loss) per common share for the three and nine months ended September 30, 2005 and 2004 would have approximated the following pro forma amounts (in thousands, except per share data):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Net income (loss), as reported	$	1,079		$	(3,058	)	$	1,780		$	(6,971	)
Deduct:
Total stock-based compensation expense determined using fair value based method for all awards, net of taxes	(641		)	(615		)	(1,917		)	(1,845		)
Net income (loss), pro forma	$	438		$	(3,673	)	$	(137	)	$	(8,816	)

Net income (loss) per common share:
Basic and diluted, as reported	$	0.01		$	(0.03	)	$	0.02		$	(0.08	)
Basic and diluted, pro forma	$	0.00		$	(0.04	)	$	0.00		$	(0.10	)

The fair value of each stock option included in the preceding pro forma amounts was estimated using the Black-Scholes option-pricing model with the following weighted average assumptions:

	2005		2004
Risk-free interest rate	3.83	%	3.63	%
Expected life of option	5 years		5 years
Volatility	67.7	%	71.5	%
Expected dividend yield	0	%	0	%

4. Inventories

Inventories consisted of the following as of September 30, 2005 and December 31, 2004 (in thousands):

	September 30,		December 31,
	2005		2004
Raw materials	$	27,695	$	30,003
Work-in-process	30,894		36,799
Demonstration units	14,495		14,558
Finished goods	26,225		26,388
Total inventories	$	99,309	$	107,748

5. Goodwill and Other Intangible Assets

The following is a summary of other intangible assets subject to amortization as of September 30, 2005 and December 31, 2004 (in thousands):

				September 30, 2005					December 31, 2004
	Useful	Gross					Net					Net
	Lives	Carrying		Accumulated			Carrying		Accumulated			Carrying
	in Years	Amount		Amortization			Amount		Amortization			Amount
Existing technology and related patents	4	$	1,520	$	(855	)	$	665	$	(570	)	$	950
Customer relationships	5	310		(139		)	171		(93		)	217
Trade names	10	310		(70		)	240		(46		)	264
Total amortizable intangible assets		$	2,140	$	(1,064	)	$	1,076	$	(709	)	$	1,431

For each of the three and nine month periods ended September 30, 2005 and 2004, the Company recorded amortization expense of approximately $0.1 million and $0.4 million, respectively, related to other amortizable intangible assets.

The estimated future amortization expense related to other amortizable intangible assets is as follows (in thousands):

For the year ending December 31,	(in thousands)
2005 (a)	$	118
2006	473
2007	281
2008	65
2009	31
Thereafter	108
Total	$	1,076

(a) Amount represents estimated amortization expense for the remaining three months ending December 31, 2005.

The carrying amount of goodwill as of September 30, 2005 and December 31, 2004 was $10.7 million and is included in the Bruker AXS segment. The Company performs its annual test for indications of impairment as of December 31^st each year. The Company completed its annual test for impairment as of December 31, 2004 and determined that goodwill was not impaired at that time.

6. Warranty Costs

The Company typically provides a one-year parts and labor warranty with the purchase of equipment. The anticipated cost for this one-year warranty is accrued upon recognition of the sale and is included as a current liability on the balance sheet. The Company also offers to its customers warranty and service agreements extending beyond the initial year of warranty for a fee. These fees are recorded as deferred revenue and amortized into income over the life of the extended warranty contract.

Changes in the Company’s accrued warranty liability during the nine months ended September 30, 2005 were as follows (in thousands):

Warranty accrual at December 31, 2004	$	8,052
Accruals for warranties issued during the period	6,188
Settlements of warranty claims	(6,034		)
Foreign currency impact	(692		)
Warranty accrual at September 30, 2005	$	7,514

7. Provision for Income Taxes

For the three and nine months ended September 30, 2005, the Company recorded an income tax provision of $2.4 million and $5.5 million, respectively, compared with an income tax provision of $1.0 million and $0.4 million, respectively, for the three and nine months ended September 30, 2004. In the United States, any income tax provision or benefit is currently recorded as an adjustment to the valuation allowance until sufficient positive evidence exists to support the reversal of a full valuation allowance which was established in 2003.

8. Employee Benefit Plans

The Company has a defined benefit retirement plan that covers substantially all employees of the Bruker AXS German subsidiary who were employed as of September 30, 1997. The plan provides pension benefits based upon final average salary and years of service.

The net periodic pension benefit cost includes the following components during the three and nine months ended September 30, 2005 and 2004 (in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Components of net periodic benefit cost
Service cost	$	154		$	154		$	480		$	462
Interest cost	93			87			288			260
Recognized actuarial loss	—			—			197			—
Amortization	(9		)	(15		)	(23		)	(45		)
Net periodic benefit cost	$	238		$	226		$	942		$	677

To date, the Company has not funded the defined benefit plan and is not required to make contributions during the remainder of 2005.

9. Earnings Per Share

Basic earnings per share is calculated by dividing net earnings (loss) by the weighted-average number of common shares outstanding during the period. Except where the result would be antidilutive, the diluted earnings per share computation includes the effect of shares which would be issuable upon the exercise of outstanding stock options, reduced by the number of shares which are assumed to be purchased by the Company from the resulting proceeds at the average market price during the period.

The following table sets forth the computation of basic and diluted average shares outstanding for the three and nine months ended September 30, 2005 and 2004 (in thousands):

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2005		2004			2005		2004
Net income (loss), as reported	$	1,079	$	(3,058	)	$	1,780	$	(6,971	)

Weighted average shares outstanding:
Weighted average shares outstanding - basic	89,476		89,456			89,473		88,156
Net effect of dilutive stock options - based on treasury stock method	193		—			147		—
Weighted average shares outstanding - diluted	89,669		89,456			89,620		88,156
Net income (loss) per share - basic and diluted	$	0.01	$	(0.03	)	$	0.02	$	(0.08	)

Stock options to purchase shares of common stock for the three and nine months ended September 30, 2004 were anti-dilutive and were excluded in the computation of diluted earnings per share due to the net losses for such periods.

10. Interest and Other Income (Expense), Net

The components of interest and other income (expense), net, were as follows for the three and nine months ended September 30, 2005 and 2004 (in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Interest income	$	1,007		$	642		$	2,472		$	1,357
Interest expense	(553		)	(753		)	(1,340		)	(1,764		)
Exchange gains (losses) on foreign currency transactions	62			(204		)	(158		)	(12		)
Appreciation (depreciation) of the fair value of derivative financial instruments	33			60			24			(25		)
Write-off of investments	—			(1,647		)	—			(2,321		)
Other income (expense)	28			—			3			(3		)
Interest and other income (expense), net	$	577		$	(1,902	)	$	1,001		$	(2,768	)

11. Comprehensive Income (Loss)

Comprehensive income (loss) refers to revenues, expenses, gains and losses that under accounting principles generally accepted in the United States of America are included in other comprehensive income (loss), but excluded from net income (loss) as these amounts are recorded directly as an adjustment to stockholders’ equity, net of tax. The following is a summary of comprehensive income (loss) for the three and nine months ended September 30, 2005 and 2004 (in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Net income (loss)	$	1,079		$	(3,058	)	$	1,780		$	(6,971	)
Foreign currency translation adjustments	(453		)	1,513			(12,188		)	(1,734		)
Total comprehensive income (loss)	$	626		$	(1,545	)	$	(10,408	)	$	(8,705	)

12. Commitments and Contingencies

Lawsuits, claims and proceedings of a nature considered normal to its businesses may be pending from time to time against the Company. The Company believes the outcome of these proceedings, if any, will not have a material impact on the Company’s financial position or results of operations.

13. Letters of Credit and Guarantees

As of September 30, 2005 and December 31, 2004, the Company had bank guarantees of $6.8 million and $7.3 million, respectively, for its customer advances. These bank guarantees affect the availability of the Company’s lines of credit.

14. Business Segment Information

SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information,” (“SFAS 131”) establishes standards for reporting information about reportable segments in financial statements of public business enterprises. SFAS 131 also establishes standards for related disclosures about products and services, geographic areas and major customers. The Company reports financial results on the basis of two reportable segments: Bruker Daltonics and Bruker AXS. Bruker Daltonics manufactures and distributes mass spectrometry instruments that can be integrated and used along with other analytical instruments. Bruker AXS primarily manufactures and distributes advanced X-ray instrumentation used in non-destructive molecular and elemental analysis in academic, research and industrial applications. Bruker BioSciences Corporation, the parent company of Bruker Daltonics and Bruker AXS, is the corporate entity that holds excess cash and short-term investments and principally incurs certain public company costs.

Selected reportable segment financial information for the three and nine months ended September 30, 2005 and 2004 is presented below (in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Revenue:
Bruker Daltonics	$	36,949		$	34,218		$	116,954		$	107,928
Bruker AXS	33,938			32,259			100,520			90,851
Eliminations (a)	(150		)	—			(458		)	—
Total	$	70,737		$	66,477		$	217,016		$	198,779

Operating income (loss):
Bruker Daltonics	$	2,946		$	1,531		$	6,894		$	1,783
Bruker AXS	594			(775		)	1,835			(3,541		)
Corporate	(612		)	(842		)	(2,351		)	(1,905		)
Total	$	2,928		$	(86	)	$	6,378		$	(3,663	)

(a) represents services revenue recorded on transactions between segments which is eliminated in consolidation.

15. Recent Accounting Pronouncements

In May 2005, the FASB issued SFAS No. 154, “Accounting Changes and Error Corrections, a replacement of APB Opinion No. 20, Accounting Changes and FASB Statement No. 3, Reporting Accounting Changes in Interim Financial Statements” (“SFAS 154”). SFAS 154 provides guidance on the accounting for and reporting of accounting changes and error corrections. It establishes, unless impracticable, retrospective application as the required method for reporting a change in accounting principle in the absence of explicit transition requirements specific to the newly adopted accounting principle. SFAS 154 also provides guidance for determining whether retrospective application of a change in accounting principle is impracticable and for reporting a change when retrospective application is impracticable. The provisions of this Statement are effective for accounting changes and corrections of errors made in fiscal periods beginning after December 15, 2005. The adoption of the provisions of SFAS 154 is not expected to have a material impact on the Company’s financial position or results of operations.

In December 2004, the FASB issued SFAS No. 123 (Revised 2004) “Share-Based Payment” (“SFAS No. 123R”) that addresses the accounting for share-based payment transactions in which a Company receives employee services in exchange for (a) equity instruments of the Company or (b) liabilities that are based on the fair value of the Company’s equity instruments or that may be settled by the issuance of such equity instruments. SFAS No. 123R addresses all forms of share-based payment awards, including shares issued under employee stock purchase plans, stock options, restricted stock and stock appreciation rights. SFAS No. 123R eliminates the ability to account for share-based compensation transactions using APB Opinion No. 25, “Accounting for Stock Issued to Employees”, that was provided in Statement 123 as originally issued. As permitted by SFAS No. 123R, the Company currently accounts for share-based payments to employees using the intrinsic value method allowed under APB Opinion 25 and, as such, generally recognizes no compensation cost for employee stock options. Accordingly, the adoption of SFAS No. 123R fair value method will have a significant impact the Company’s results of operations, although it will have no impact on our overall financial position. The impact of adoption of SFAS No. 123R cannot be predicted at this time because it will depend on levels of share-based payments granted in the future. However, had we adopted SFAS No. 123R in prior periods, the impact would have approximated the amounts calculated using SFAS No. 123 as described in the disclosure of pro forma net income (loss) and net income (loss) per share in Note 3 to our consolidated financial statements.

16. Material Definitive Agreements

On August 13, 2005, the Company executed a binding agreement to acquire all the capital stock of SOCABIM SAS (“SOCABIM”), a privately-held Paris, France based company focused on advanced X-ray materials research and analysis software.

At the closing, the Company will pay approximately $8.5 million of consideration comprised of (a) approximately $7.2 million in cash, and (b) approximately $1.3 million, which may, at the Company’s discretion, be paid either in cash or by the issuance of restricted shares of Bruker BioSciences Corporation common stock to SOCABIM. In addition, there is the possibility of an earn-out in the amount of approximately $1.9 million.

On October 10, 2005, the Company executed a binding agreement to acquire all of the capital stock of Röntec AG (“Röntec”), an X-ray analysis instrumentation company based in Berlin, Germany. At the closing, the Company will pay approximately $1.8 million of cash to satisfy Röntec’s outstanding debt and approximately $3.7 million of consideration to Röntec’s shareholders, of

which approximately $0.9 million will be paid through the issuance of restricted shares of the Company’s common stock and the remainder of which shall be paid in cash to Röntec’s shareholders. Pursuant to the earn-out provisions of the agreement, up to approximately $1.9 million of additional consideration, which will consist of a combination of 50% cash and 50% restricted shares, may be paid to Röntec’s management, employee and consultant shareholders based on the 2006 and 2007 performance of Röntec. The Company also has an option to pay the earn-out 100% in cash.

On October 21, 2005, the Company executed a binding agreement to acquire the X-ray microanalysis business of Princeton Gamma-Tech Instruments, Inc. (“PGT”), which is based in Rocky Hill, New Jersey. At the closing, the Company will pay approximately $1.9 million of consideration to PGT, of which $0.4 million shall be held in escrow for twelve months pending the satisfaction of the non-competition and non-solicitation covenant in the agreement.

17. Subsequent Events

Accelerated Vesting of Unvested Stock Options

On October 3, 2005, the Compensation Committee of the Board of Directors of the Company approved the acceleration of vesting of all unvested options to purchase shares of common stock of the Company that are held by current employees, officers and directors of the Company, which have an exercise price per share equal to or greater than $4.64 (the closing market price of the Company’s common stock on October 3, 2005). Options to purchase 857,923 shares of common stock are subject to this acceleration, including 132,688 options held by officers and directors of the Company. Under the accounting for stock options in accordance with Accounting Principles Board Opinion No. 25 “Accounting for Stock Issued to Employees”, and FASB Interpretation No. 44 “Accounting for Certain Transactions Involving Stock Compensation”, the acceleration of the vesting of these options will not result in a compensation charge in the fourth quarter ending December 31, 2005 because the exercise prices of the affected options (which have not changed) is greater than the closing price of the Company’s common stock on October 3, 2005.

Because these options have exercise prices in excess of current market values (are “underwater”), they are not fully achieving their original objectives of incentive compensation and employee retention. The Company believes that the acceleration of these underwater options may have a positive effect on employee morale and retention. The acceleration also reduces future compensation expense that the Company would otherwise recognize in its consolidated statement of operations with respect to these options once the Statement of Financial Accounting Standards No. 123 (revised 2004) “Share-Based Payment”, issued by the Financial Accounting Standards Board, becomes effective for reporting periods beginning in January 2006. Management has estimated the pre-tax charge to be eliminated from future accounting periods beginning in January 2006 amounts to approximately $3.7 million over the original remaining vesting periods of the affected options.

ITEM 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion of our financial condition and results of operations should be read in conjunction with our interim condensed consolidated financial statements and the notes to those statements included in Part 1, Item 1 of this Quarterly Report on Form 10-Q, and in conjunction with the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2004.

Statements contained in Management’s Discussion and Analysis of Financial Condition and Results of Operations which express that we “believe”, “anticipate”, “expect” or “plan to”, as well as other statements which are not historical fact, are forward-looking statements within the meaning of the Private Securities Litigation Act of 1995. Actual events or results may differ materially from those set forth in forward-looking statements. Certain factors that might cause such a difference are discussed in “Factors Affecting Our Business, Operating Results and Financial Condition” set forth in our Annual Report on Form 10-K for the year ended December 31, 2004.

OVERVIEW

Bruker BioSciences

The Company has restated its previously issued consolidated financial statements for the three and nine months ended September 30, 2004. Certain costs historically classified in sales and marketing and research and development expense were reclassified to cost of product revenue. For the three and nine months ended September 30, 2004, approximately $2.1 million and $6.6 million, respectively, related to the write-down of demonstration inventory to net realizable value was reclassified from sales and marketing and research and development expense to cost of product revenue. The Company also made changes to the consolidated financial statements for the three and nine months ended September 30, 2004 increasing cost of product revenue by $0.3 million and $0.6 million, respectively, for accounting corrections related primarily to inventory costing identified during the 2004 year-end closing process. The accounting corrections identified during the 2004 year-end closing process impacted the Company’s U.S. operations and no tax effect was recognized on these adjustments.

For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004.

The performance of the Bruker Daltonics business is dependent upon its products in life-science mass spectrometry and Nuclear, Biological and Chemical (“NBC”) detection. During the nine months ended September 30, 2005 revenues increased by 8.4% over the comparable period in 2004.

The analytical X-Ray performance of the Bruker AXS business is dependent upon its products in single crystal X-ray diffraction (“SCD”), polycrystalline X-ray diffraction (“XRD”) and X-ray flourescence (“XRF”), as well as thermal analyzers. During the nine months ended September 30, 2005, revenues increased by 10.6% over the comparable period in 2004. In October 2005, Bruker AXS announced it entered into agreements to purchase Röntec AG and the x-ray microanalysis business of Princeton Gamma-Tech Instruments, Inc. These acquisitions are expected to close in the fourth quarter of 2005 and will be combined to form a new group within Bruker AXS which will focus on the X-ray microanalysis market, a market not previously addressed by Bruker AXS.

Our operating and net income has also improved during the nine months ended September 30, 2005 compared to the nine months ended September 30, 2004 as we continue to focus on becoming more profitable. We experienced improvements in overall gross

profit margins year-over-year, increasing from 40.3% during the nine months ended September 30, 2004 to 42.0% during the nine months ended September 30, 2005. These improvements are a result of our various ongoing gross margin improvement initiatives, as well as better capacity utilization on higher revenues. Our operating expenses as a percentage of revenue also decreased when comparing the nine months ended September 30, 2005 to the nine months ended September 30, 2004.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires that we make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and judgments, including those related to revenue recognition, allowance for doubtful accounts, inventories, goodwill, long-lived assets, warranty costs, income taxes, contingencies, and restructuring. We base our estimates and judgments on historical experience, current market and economic conditions, our observance of industry trends and other assumptions that we believe are reasonable and form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates.

We believe the following critical accounting policies to be both those most important to the portrayal of our financial condition and those that require the most subjective judgment.

Revenue recognition. We recognize revenue from system sales when persuasive evidence of an arrangement exists, the price is fixed or determinable, title and risk of loss has been transferred to the customer and collectibility of the resulting receivable is reasonably assured. Title and risk of loss is generally transferred to the customer upon receipt of a signed customer acceptance form for a system that has been shipped, installed, and for which the customer has been trained. As a result, the timing of customer acceptance or readiness could cause our reported revenues to differ materially from expectations. When products are sold through an independent distributor, a strategic distribution partner or an unconsolidated affiliated distributor, which assumes responsibility for installation, we recognize the system sale when the product has been shipped and title and risk of loss has been transferred. Our distributors do not have price protection rights or rights to return; however, our products are warranted to be free from defect for a period of one year. For arrangements with multiple elements, we recognize revenue for each element based on the fair value of the element provided all other criteria for revenue recognition have been met. The fair value for each element provided in multiple element arrangements is typically determined by referencing historical pricing policies when the element is sold separately. Changes in our ability to establish the fair value for each element in multiple element arrangements could affect the timing of revenue recognition.

Revenue from accessories and parts is recognized upon shipment and service revenue is recognized as the services are performed.

Allowance for doubtful accounts. We maintain allowances for doubtful accounts for estimated losses resulting from the inability of our customers to pay amounts due. If the financial condition of our customers were to deteriorate, reducing their ability to make payments, additional allowances would be required, resulting in a charge to operations.

Inventories. Inventories are stated at the lower of cost or market, with cost determined by the first-in, first-out method. We maintain an allowance for excess and obsolete inventory to reflect the expected un-saleable or un-refundable inventory based on an evaluation of slow moving products. If ultimate usage or demand varies significantly from expected usage or demand, additional write-downs may be required, resulting in a charge to operations.

Goodwill, other intangible assets, investments in other companies, and other long-lived assets. We perform an evaluation of whether goodwill is impaired annually or when events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Fair value is determined using market comparables for similar businesses or forecasts of discounted future cash flows. We also review other intangible assets, investments in other companies, and other long-lived assets when indication of potential impairment exists, such as a significant reduction in cash flows associated with the assets. Should the fair value of our long-lived assets decline because of reduced operating performance, market declines, or other indicators of impairment, a charge to operations for impairment may be necessary.

Warranty costs. We normally provide a one-year parts and labor warranty with the purchase of equipment. The anticipated cost for this one-year warranty is accrued upon recognition of the sale and is included as a current liability on the balance sheet. Although our facilities undergo quality assurance and testing procedures throughout the production process, our warranty obligation is affected by product failure rates subsequent to initial installation and customer acceptance, material

usage and service delivery costs incurred in correcting a product failure. Although our actual warranty costs have historically been consistent with expectations, to the extent warranty claims activity or costs associated with servicing those claims differ from our estimates, revisions to the warranty accrual may be required.

Income taxes. We estimate the degree to which tax assets and loss carryforwards will result in a benefit based on expected profitability by tax jurisdiction, and provide a valuation allowance for tax assets and loss carryforwards that we believe will more likely than not go unused. If it becomes more likely than not that a tax asset or loss carryforward will be used for which a reserve has been provided, we reverse the related valuation allowance. If our actual future taxable income by tax jurisdiction differ from estimates, additional allowances or reversals of reserves may be necessary.

Contingencies. We estimate losses on contingencies and provide a reserve for these losses when the losses are probable and estimable. Should the ultimate losses on contingencies and litigation differ from estimates, adjustments to those reserves may be required.

Results of Operations

Three months ended September 30, 2005 compared to the three months ended September 30, 2004

The Company, as discussed above, has restated its previously issued consolidated financial statements for the three months ended September 30, 2004 for certain reclassifications and corrections of inventory-related costs. These adjustments are reflected in the following tables and discussions within Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Revenue

The following table presents revenue, change in revenue and revenue growth by reportable segment for the three months ended September 30, 2005 and 2004 (dollars in thousands):

									Percentage
	2005			2004		$ Change			Change
Bruker Daltonics	$	36,949		$	34,218	$	2,731		8.0	%
Bruker AXS	33,938			32,259		1,679			5.2	%
Eliminations (a)	(150		)	—		(150		)
Total Revenue	$	70,737		$	66,477	$	4,260		6.4	%

(a) represents service revenue recorded on transactions between segments which is eliminated in consolidation.

Bruker Daltonics’ revenue increased by $2.7 million, or 8.0%, to $36.9 million for the three months ended September 30, 2005 compared to $34.2 million for the comparable period in 2004. Included in this change in revenue is approximately $0.4 million from the impact of foreign exchange. Excluding the effect of foreign exchange, revenue increased by 7.0%. The increase in revenue excluding the effect of foreign exchange is a result of an increase in the number of life science systems sold period-over-period, partially offset by pricing pressures due to increased competition, and an increase in aftermarket revenue, which consists primarily of consumables, accessories, training and service primarily due to an increase in service revenue. Revenue associated with NBC detection systems was relatively flat year-over-year, but decreased as a percentage of product and service revenue. Included in other revenue for the three months ended September 30, 2005 and 2004 are grant revenues from various projects for early-stage research and development projects funded by the German government. This revenue reflects the impact of revised government rates published by the German government in the third quarter of 2005. Life science systems, NBC detection systems and aftermarket revenue as a percentage of Bruker Daltonics’ product and service revenue were as follows during the three months ended September 30, 2005 and 2004:

	2005				2004
			Percentage of				Percentage of
			Segment Product				Segment Product
	Revenue		and Service Revenue		Revenue		and Service Revenue
Life Science Systems	$	26,580	73.8	%	$	24,799	73.8	%
NBC Detection Systems	2,287		6.3	%	2,403		7.2	%
Bruker Daltonics Aftermarket	7,154		19.9	%	6,382		19.0	%
Product and Service Revenue	36,021		100	%	33,584		100	%
Grant Revenue	928				634
Total Revenue	$	36,949			$	34,218

Bruker AXS’ revenue increased by $1.7 million, or 5.2%, to $33.9 million for the three months ended September 30, 2005 compared to $32.3 million for the comparable period in 2004. Included in this change in revenue is approximately $0.1 million from the impact of foreign exchange. Excluding the effect of foreign exchange, revenue increased by 4.9%. The increase in revenue excluding the effect of foreign exchange is attributable to growth in our materials research systems and other systems revenue, and continued strong aftermarket revenue, partially offset by decreases in life science and elemental composition systems revenue. Other system revenue relates primarily to the distribution of products not manufactured by Bruker AXS. X-ray systems, other systems and aftermarket revenue as a percentage of Bruker AXS’ product and service revenue were as follows during the three months ended September 30, 2005 and 2004:

	2005				2004
			Percentage of				Percentage of
			Segment Product				Segment Product
	Revenue		and Service Revenue		Revenue		and Service Revenue
X-Ray Systems	$	23,072	68.0	%	$	23,746	73.6	%
Other System Revenue	2,290		6.7	%	1,043		3.2	%
Bruker AXS Aftermarket	8,576		25.3	%	7,470		23.2	%
Total Product and Service Revenue	$	33,938	100	%	$	32,259	100	%

Cost of Revenue

The following table presents cost of product and service revenue and gross profit margins on product and service revenue by reportable segment for the three months ended September 30, 2005 and 2004 (dollars in thousands):

	2005					2004
	Cost of			Gross Profit		Cost of		Gross Profit
	Revenue			Margin		Revenue		Margin
Bruker Daltonics	$	19,434		46.0	%	$	17,251	48.6	%
Bruker AXS	21,034			38.0	%	20,279		37.1	%
Eliminations (a)	(150		)	—
Total Cost of Revenue	$	40,318		42.2	%	$	37,530	43.0	%

(a) represents the cost of services provided between segments which is eliminated in consolidation.

Bruker Daltonics’ cost of product and service revenue for the three months ended September 30, 2005 was $19.4 million, resulting in a gross profit margin of 46.0%, compared to cost of product and service revenue of $17.3 million, or a gross profit margin of 48.6% for the comparable period in 2004. The decrease in gross profit margin is attributable to the combination of pricing pressures due to increased competition and a favorable product mix in the third quarter of 2004 compared to 2005, partially offset by gross profit margin improvements related to various ongoing gross profit margin improvement programs and better capacity utilization as a result of increased revenue period-over-period.

Bruker AXS’ cost of product and service revenue for the three months ended September 30, 2005 was $21.0 million, resulting in a gross profit margin of 38.0%, compared to cost of product and service revenue of $20.3 million, or a gross profit margin of 37.1% for the

comparable period in 2004. The increase in gross profit margin is primarily attributable to various ongoing gross profit margin improvement programs, reduced warranty expenses as improvements continue to be made on the products introduced during 2004 and 2005 and better capacity utilization as a result of increased revenue period-over-period, partially offset by an increase in inventory reserves during the third quarter of 2005.

Sales and Marketing

The following table presents sales and marketing expense and sales and marketing expense as a percentage of product and service revenue by reportable segment for the three months ended September 30, 2005 and 2004 (dollars in thousands):

	2005				2004
			Percentage of				Percentage of
	Sales and		Segment Product		Sales and		Segment Product
	Marketing		and Service Revenue		Marketing		and Service Revenue
Bruker Daltonics	$	5,582	15.5	%	$	6,380	19.0	%
Bruker AXS	6,263		18.5	%	6,572		20.4	%
Total Sales and Marketing	$	11,845	17.0	%	$	12,952	19.7	%

Bruker Daltonics’ sales and marketing expense for the three months ended September 30, 2005 decreased to $5.6 million, or 15.5% of product and service revenue, from $6.4 million, or 19.0% of product and service revenue for the comparable period in 2004. The decrease in sales and marketing expense as a percentage of product and service revenue is primarily attributable to increased revenue in the third quarter of 2005 as compared to the third quarter of 2004 and to benefits realized from cost control initiatives announced during the second half of 2004, partially offset by increased commissions on higher revenues year-over-year.

Bruker AXS’ sales and marketing expense for the three months ended September 30, 2005 decreased to $6.3 million, or 18.5% of product and service revenue, from $6.6 million, or 20.4% of product and service revenue for the comparable period in 2004. The decrease in sales and marketing expense as a percentage of product and service revenue is primarily attributable to increased revenue in the third quarter of 2005 as compared to the third quarter of 2004 and to benefits realized from cost control initiatives announced during the second half of 2004, partially offset by increased commissions on higher revenues year-over-year.

General and Administrative

The following table presents general and administrative expense and general and administrative expense as a percentage of product and service revenue by reportable segment for the three months ended September 30, 2005 and 2004 (dollars in thousands):

	2005				2004
			Percentage of				Percentage of
	General and		Segment Product		General and		Segment Product
	Administrative		and Service Revenue		Administrative		and Service Revenue
Bruker Daltonics	$	2,285	6.3	%	$	1,804	5.4	%
Bruker AXS	2,780		8.2	%	2,611		8.1	%
Corporate	612				842
Total General and Administrative	$	5,677	8.1	%	$	5,257	8.0	%

Bruker Daltonics’ general and administrative expense for the three months ended September 30, 2005 increased to $2.3 million, or 6.3% of product and service revenue, from $1.8 million, or 5.4% of product and service revenue for the comparable period in 2004. The increase in general and administrative expenses as a percentage of product and service revenue is primarily due to increased professional service fees associated with audit and Sarbanes-Oxley requirements, and an increase in bad debt reserves during the third quarter of 2005.

Bruker AXS’ general and administrative expenses for the three months ended September 30, 2005 increased to $2.8 million, or 8.2% of product and service revenue, from $2.6 million, or 8.1% of product and service revenue for the comparable period in 2004. The increase in general and administrative expenses as a percentage of product and service revenue is primarily due to increased professional service fees associated with audit and Sarbanes-Oxley requirements and certain professional fees incurred during the third quarter of 2005 associated with increased business development activities.

Corporate general and administrative expense for the three months ended September 30, 2005 decreased to $0.6 million from $0.8 million for the comparable period in 2004. Corporate general and administrative expenses represent expenses associated with being a public company not allocated to our reportable segments, including legal fees, audit and consulting fees and filing fees. The decrease in expenses is primarily attributable to certain accounting, audit and consulting fees recorded within corporate during the three months ended September 30, 2004 now being allocated to our reportable segments.

Research and Development

The following table presents research and development expense and research and development expense as a percentage of product and service revenue by reportable segment for the three months ended September 30, 2005 and 2004 (dollars in thousands):

	2005				2004
			Percentage of				Percentage of
	Research and		Segment Product		Research and		Segment Product
	Development		and Service Revenue		Development		and Service Revenue
Bruker Daltonics	$	6,703	18.6	%	$	7,253	21.6	%
Bruker AXS	3,266		9.6	%	3,571		11.1	%
Total Research and Development	$	9,969	14.3	%	$	10,824	16.4	%

Bruker Daltonics’ research and development expense for the three months ended September 30, 2005 decreased to $6.7 million, or 18.6% of product and service revenue, from $7.3 million, or 21.6% of product and service revenue for the comparable period in 2004. The decrease in research and development expense is primarily attributable to benefits realized from cost control initiatives announced during the second half of 2004 and to a decrease in material purchases during the third quarter of 2005 compared to the third quarter of 2004.

Bruker AXS’ research and development expense for the three months ended September 30, 2005 decreased to $3.3 million, or 9.6% of product and service revenue, from $3.6 million, or 11.1% of product and service revenue for the comparable period in 2004. The decrease in research and development expense is primarily related cost control initiatives announced during the second half of 2004 and a decrease in external consulting services utilized during the third quarter of 2005 compared to the third quarter of 2004.

Interest and Other Income (Expense), Net

Interest and other income (expense), net, during the three months ended September 30, 2005 was $0.6 million compared to ($1.9) million during the comparable period in 2004. During the three months ended September 30, 2005, the major component within interest and other income (expense), net, was net interest income of $0.5 million. During the three months ended September 30, 2004, the major components within interest and other income (expense), net, were the write-off an investment in the amount of ($1.6) million, losses on foreign currency transactions of ($0.2) million and net interest expense of ($0.1) million.

Provision for Income Taxes

The income tax provision for the three months ended September 30, 2005 was $2.4 million compared to an income tax provision of $1.0 million for the comparable period in 2004. During the third quarter of 2005 and 2004, our effective tax rate was approximately 68% and (48%), respectively, and reflects our tax provision for non-U.S. entities only since no benefit was recognized for losses incurred in the U.S. We will maintain a full valuation allowance for our U.S. net operating losses until such evidence exists that it is more likely than not that the loss carry forward amounts will be utilized to offset U.S. taxable income. Our tax rate may change over time as the amount or mix of income and taxes outside the U.S. changes. Our effective tax rate is calculated using our projected annual pre-tax income or loss and is affected by research and development tax credits, the expected level of other tax benefits, the impact of changes to the valuation allowance as well as changes in the mix of our pre-tax income and losses among jurisdictions with varying statutory tax rates and credits.

Minority Interest in Consolidated Subsidiaries

Minority interest in consolidated subsidiaries for the three months ended September 30, 2005 was $28,000 compared to $0.1 million in the comparable period of 2004. The minority interest in subsidiaries represents the minority shareholders’ proportionate share of net income of those subsidiaries for the three months ended September 30, 2005 and 2004. For the three months ended

September 30, 2005 and 2004, the minority interest relates to our two majority-owned subsidiaries, Incoatec GmbH and Baltic Scientific Instruments Ltd.

Nine months ended September 30, 2005 compared to the nine months ended September 30, 2004

The Company, as discussed above, has restated its previously issued consolidated financial statements for the nine months ended September 30, 2004. These adjustments are reflected in the following tables and discussions within Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Revenue

The following table presents revenue, change in revenue and revenue growth by reportable segment for the nine months ended September 30, 2005 and 2004 (dollars in thousands):

									Percentage
	2005			2004		$ Change			Change
Bruker Daltonics	$	116,954		$	107,928	$	9,026		8.4	%
Bruker AXS	100,520			90,851		9,669			10.6	%
Eliminations (a)	(458		)	—		(458		)
Total Revenue	$	217,016		$	198,779	$	18,237		9.2	%

(a) represents service revenue recorded on transactions between segments which are eliminated in consolidation.

Bruker Daltonics’ revenue increased by $9.0 million, or 8.4%, to $117.0 million for the nine months ended September 30, 2005 compared to $107.9 million for the comparable period in 2004. Included in this change in revenue is approximately $2.9 million from the impact of foreign exchange. Excluding the effect of foreign exchange, revenue increased by 5.6%. The increase in revenue excluding the effect of foreign exchange is a result of an increase in the number of life science and NBC detection systems sold period-over-period and increased aftermarket revenue, partially offset by pricing pressures due to increased competition. Revenues for the nine months ended September 30, 2005 and 2004 include grant revenues from various projects for early-stage research and development projects funded by the German government. Life science systems, NBC detection systems and aftermarket revenue as a percentage of Bruker Daltonics’ product and service revenue were as follows during the nine months ended September 30, 2005 and 2004:

	2005				2004
			Percentage of				Percentage of
			Segment Product				Segment Product
	Revenue		and Service Revenue		Revenue		and Service Revenue
Life Science Systems	$	81,243	70.6	%	$	77,275	72.4	%
NBC Detection Systems	10,962		9.5	%	8,804		8.3	%
Bruker Daltonics Aftermarket	22,821		19.9	%	20,632		19.3	%
Product and Service Revenue	115,026		100	%	106,711		100	%
Grant Revenue	1,928				634
Total Revenue	$	116,954			$	107,345

Bruker AXS’ revenue increased by $9.7 million, or 10.6%, to $100.5 million for the nine months ended September 30, 2005 compared to $90.9 million for the comparable period in 2004. Included in this change in revenue is approximately $2.3 million from the impact of foreign exchange. Excluding the effect of foreign exchange, revenue increased by 8.1%. The increase in revenue excluding the effect of foreign exchange is attributable to growth in our materials research systems and other systems revenue, and continued strong aftermarket revenue, partially offset by declines in life science and elemental composition systems revenue. Other system revenue relates primarily to the distribution of products not manufactured by Bruker AXS. X-ray systems, other systems and aftermarket revenue as a percentage of Bruker AXS’ product and service revenue were as follows during the nine months ended September 30, 2005 and 2004:

	2005				2004
			Percentage of				Percentage of
			Segment Product				Segment Product
	Revenue		and Service Revenue		Revenue		and Service Revenue
X-Ray Systems	$	70,669	70.3	%	$	65,307	71.9	%
Other System Revenue	4,415		4.4	%	1,679		1.8	%
Bruker AXS Aftermarket	25,436		25.3	%	23,865		26.3	%
Total Product and Service Revenue	$	100,520	100	%	$	90,851	100	%

Cost of Revenue

The following table presents cost of product and service revenue and gross profit margins on product and service revenue by reportable segment for the nine months ended September 30, 2005 and 2004 (dollars in thousands):

	2005					2004
	Cost of			Gross Profit		Cost of		Gross Profit
	Revenue			Margin		Revenue		Margin
Bruker Daltonics	$	64,952		43.5	%	$	60,894	42.9	%
Bruker AXS	60,179			40.1	%	57,126		37.1	%
Eliminations (a)	(458		)			—
Total Cost of Revenue	$	124,673		42.0	%	$	118,020	40.3	%

(a) represents service revenue recorded on transactions between segments which are eliminated in consolidation.

Bruker Daltonics’ cost of product and service revenue for the nine months ended September 30, 2005 was $65.0 million, or a gross profit margin of 43.5%, compared to cost of product and service revenue of $60.9 million, or a gross profit margin of 42.9% for the comparable period in 2004. The increase in gross profit margins is primarily attributable to various ongoing gross profit margin improvement programs and better capacity utilization as a result of increased revenues period-over-period, partially offset by pricing pressures due to increased competition.

Bruker AXS’ cost of product and service revenue for the nine months ended September 30, 2005 was $60.2 million, or a gross profit margin of 40.1%, compared to cost of product and service revenue of $57.1 million, or a gross profit margin of 37.1% for the comparable period in 2004. The increase in gross profit margins is primarily attributable to various ongoing gross profit margin improvement programs and reduced warranty expenses as improvements continue to be made on the products introduced during 2004 and 2005, partially offset by the lower margins derived from other system revenues, which increased period-over-period.

Sales and Marketing

The following table presents sales and marketing expense and sales and marketing expense as a percentage of product and service revenue by reportable segment for the nine months ended September 30, 2005 and 2004 (dollars in thousands):

	2005				2004
			Percentage of				Percentage of
	Sales and		Segment Product		Sales and		Segment Product
	Marketing		and Service Revenue		Marketing		and Service Revenue
Bruker Daltonics	$	17,404	15.1	%	$	18,209	17.1	%
Bruker AXS	19,978		19.9	%	20,607		22.7	%
Total Sales and Marketing	$	37,382	17.4	%	$	38,816	19.6	%

Bruker Daltonics’ sales and marketing expense for the nine months ended September 30, 2005 decreased to $17.4 million, or 15.1% of product and service revenue, from $18.2 million, or 17.1% of product and service revenue for the comparable period in 2004. The decrease in sales and marketing expense as a percentage of product and service revenue is primarily attributable to increased revenue during the nine months ended September 30, 2005 compared to the comparable period in 2004 and to benefits realized from cost

control initiatives announced during the second half of 2004, partially offset by increased commissions on higher revenues year-over-year.

Bruker AXS’ sales and marketing expense for the nine months ended September 30, 2005 decreased to $20.0 million, or 19.9% of product and service revenue, from $20.6 million, or 22.7% of product and service revenue for the comparable period in 2004. The decrease in sales and marketing expense as a percentage of product and service revenue is primarily attributable to increased revenue during the nine months ended September 30, 2005 as compared to the nine months ended September 30, 2004 and to benefits realized from cost control initiatives announced during the second half of 2004, partially offset by increased commissions on higher revenues year-over-year.

General and Administrative

The following table presents general and administrative expense and general and administrative expense as a percentage of product and service revenue by reportable segment for the nine months ended September 30, 2005 and 2004 (dollars in thousands):

	2005				2004
			Percentage of				Percentage of
	General and		Segment Product		General and		Segment Product
	Administrative		and Service Revenue		Administrative		and Service Revenue
Bruker Daltonics	$	6,603	5.7	%	$	5,534	5.2	%
Bruker AXS	7,678		7.6	%	7,075		7.8	%
Corporate	2,351				1,906
Total General and Administrative	$	16,632	7.7	%	$	14,515	7.3	%

Bruker Daltonics’ general and administrative expense for the nine months ended September 30, 2005 increased to $6.6 million, or 5.7% of product and service revenue, from $5.5 million, or 5.2% of product and service revenue for the comparable period in 2004. The increase in general and administrative expenses as a percentage of product and service revenue is primarily due to increased professional service fees associated with audit and Sarbanes-Oxley requirements, and an increase in bad debt reserves during the nine months ended September 30, 2005.

Bruker AXS’ general and administrative expense for the nine months ended September 30, 2005 increased to $7.7 million, or 7.6% of product and service revenue, from $7.1 million, or 7.8% of product and service revenue for the comparable period in 2004. The decrease in general and administrative expenses as a percentage of product and service revenue is primarily attributable to increased revenue during the nine months ended September 30, 2005 as compared to the nine months ended September 30, 2004 and to cost control initiatives announced during the second half of 2004, partially offset by increased professional service fees associated with audit and Sarbanes-Oxley requirements.

Corporate general and administrative expense for the nine months ended September 30, 2005 increased to $2.4 million from $1.9 million for the comparable period in 2004. Corporate general and administrative expenses represent expenses associated with being a public company not allocated to our reportable segments, including legal fees, audit and consulting fees and filing fees. The increase in expenses is primarily attributable to increased professional service fees associated with audit and Sarbanes-Oxley requirements, partially offset by certain accounting, audit and consulting fees classified as corporate expenses during the nine months ended September 30, 2004 now being allocated to our reportable segments.

Research and Development

The following table presents research and development expense and research and development expense as a percentage of product and service revenue by reportable segment for the nine months ended September 30, 2005 and 2004 (dollars in thousands):

	2005				2004
			Percentage of				Percentage of
	Research and		Segment Product		Research and		Segment Product
	Development		and Service Revenue		Development		and Service Revenue
Bruker Daltonics	$	21,101	18.3	%	$	21,507	20.2	%
Bruker AXS	10,850		10.8	%	9,584		10.5	%

Total Research and Development	$	31,951	14.9	%	$	31,091	15.7	%

Bruker Daltonics’ research and development expense for the nine months ended September 30, 2005 decreased to $21.1 million, or 18.3% of product and service revenue, from $21.5 million, or 20.2% of product and service revenue for the comparable period in 2004. The decrease in research and development expenses is primarily attributable to benefits realized from cost control initiatives announced during the second half of 2004 and to a decrease in material purchases during the nine months ended September 30, 2005 compared to the comparable period in 2004.

Bruker AXS’ research and development expense for the nine months ended September 30, 2005 increased to $10.9 million, or 10.8% of product and service revenue, from $9.6 million, or 10.5% of product and service revenue for the comparable period in 2004. The increase in research and development expense as a percentage of product and service revenue is primarily related to the purchase of materials associated with completing a prototype for a potential new product expected to be introduced within the next year.

Interest and Other Income (Expense), Net

Interest and other income (expense), net, during the nine months ended September 30, 2005 was $1.0 million compared to ($2.8) million during the comparable period in 2004. During the nine months ended September 30, 2005, the major components within interest and other income (expense), net, were net interest income of $1.1 million and losses on foreign currency transactions of ($0.1) million. During the nine months ended September 30, 2004, the major components within interest and other income (expense), net were the write-off an investment in the amount of ($2.3) million and net interest expense of ($0.4) million.

Provision for Income Taxes

The income tax provision for the nine months ended September 30, 2005 was $5.5 million compared to an income tax provision of $0.4 million for the comparable period in 2004. During the nine months ended September 30, 2005 and 2004, our effective tax rate was approximately 74% and (6%), respectively, and reflects our tax provision for non-U.S. entities only since no benefit was recognized for losses incurred in the U.S. We will maintain a full valuation allowance for our U.S. net operating losses until such evidence exists that it is more likely than not that the loss carry-forward amounts will be utilized to offset U.S. taxable income. Our tax rate may change over time as the amount or mix of income and taxes outside the U.S. changes. Our effective tax rate is calculated using our projected annual pre-tax income or loss and is affected by research and development tax credits, the expected level of other tax benefits, the impact of changes to the valuation allowance as well as changes in the mix of our pre-tax income and losses among jurisdictions with varying statutory tax rates and credits.

Minority Interest in Consolidated Subsidiaries

Minority interest in consolidated subsidiaries for each of the nine months ended September 30, 2005 and 2004 was $0.1 million. The minority interest in subsidiaries represents the minority shareholders’ proportionate share of net income of these subsidiaries for the nine months ended September 30, 2005 and 2004. For the nine months ended September 30, 2005 and 2004, the minority interest relates to our two majority-owned subsidiaries, Incoatec GmbH and Baltic Scientific Instruments Ltd.

LIQUIDITY AND CAPITAL RESOURCES

We currently anticipate that our existing capital resources will meet our operating and investing needs for at least the next twelve months. Cash requirements for periods beyond the next twelve months depend on our profitability, our ability to manage working capital requirements and our growth rate. Historically, we have financed our growth through a combination of debt financings and issuances of common stock. In the future, there can be no assurance that additional financing alternatives will be available to us if required, or if available, will be obtained with terms favorable to us.

During the nine months ended September 30, 2005, net cash provided by operating activities was $25.6 million compared to net cash used in operating activities of $10.5 million during the nine months ended September 30, 2004. The increase in cash provided by

operating activities was primarily attributable to decreases in accounts receivable and inventories and increases in customer deposits.

During the nine months ended September 30, 2005, investing activities used $2.2 million in cash compared to net cash used in investing activities of $4.2 million during the nine months ended September 30, 2004. Cash used in investing activities during the nine months ended September 30, 2005 and 2004 was primarily attributable to capital expenditures. During the remainder of 2005, we expect to continue to make modest capital investments, focusing on enhancing the efficiency of our operations and supporting our anticipated continued growth.

During the nine months ended September 30, 2005, financing activities used $3.1 million of cash compared to providing $14.7 million of cash during the nine months ended September 30, 2004. The decrease in cash provided by financing activities during the nine months ended September 30, 2005 is attributable to a completion of a public offering of our common stock in April of 2004 which generated net proceeds to the Company of approximately $14.5 million, and the net repayment of debt totaling $3.6 million during the nine months ended September 30, 2005.

We have a demand revolving line of credit with Citizens Bank in the United States in the amount of $2.5 million. The line of credit, which is secured by portions of our inventory, receivables and equipment in the United States, is used to support our working capital requirements and expires in June 2006. As of September 30, 2005, the full amount of our U.S. line of credit was available. We also maintain revolving lines of credit totaling approximately $33.9 million with various German and Japanese banks. The German and Japanese lines of credit are unsecured. As of September 30, 2005, approximately $9.5 million was outstanding on our German and Japanese lines of credit.

In addition to our lines of credit, we have both short-term and long-term notes payable with outstanding balances aggregating approximately $32.8 million as of September 30, 2005. The interest rates on these obligations range from 1.00% to 5.10%. We entered into an interest rate swap to hedge the variability of cash flows related to changes in interest rates on borrowings of variable debt obligations and pay a 4.6% fixed rate of interest and receive a variable rate of interest based on the Bond Market Association Municipal Swap Index. The interest rate swap has a notional value of $2.2 million which decreases in conjunction with the IRB payment schedule until the interest rate swap and IRB agreements terminate in December 2013.

The following table summarizes maturities for our significant financial obligations as of September 30, 2005 (in thousands):

			Less than		1-3		4-5		More than
Contractual Obligations	Total		1 year		years		years		5 years
Short-term borrowings	$	10,960	$	10,960	$	—	$	—	$	—
Pension	8,214		4		4		8		8,198
Total contractual obligations	$	19,174	$	10,964	$	4	$	8	$	8,198

As of September 30, 2005, the Company also has outstanding long-term debt totaling $21.8 million. In connection with some of our outstanding debt, we are required to maintain certain financial ratios and meet other financial criteria. Additionally, we are subject to a variety of restrictive covenants that require bank consent if not met. As of September 30, 2005, the latest measurement date, we were not in compliance with the required debt service coverage ratio associated with our industrial revenue bonds from the State of Wisconsin. On October 24, 2005, the Company received from the holder of the debt a limited waiver for the quarterly measurement period ending September 30, 2005.

Recent Accounting Pronouncements

In December 2004, the FASB issued SFAS No. 123 (Revised 2004) “Share-Based Payment” (“SFAS No. 123R”) that addresses

the accounting for share-based payment transactions in which a Company receives employee services in exchange for (a) equity instruments of the Company or (b) liabilities that are based on the fair value of the Company’s equity instruments or that may be settled by the issuance of such equity instruments. SFAS No. 123R addresses all forms of share-based payment awards, including shares issued under employee stock purchase plans, stock options, restricted stock and stock appreciation rights. SFAS No. 123R eliminates the ability to account for share-based compensation transactions using APB Opinion No. 25, “Accounting for Stock Issued to Employees”, that was provided in SFAS 123 as originally issued. As permitted by SFAS No. 123R, the Company currently accounts for share-based payments to employees using the intrinsic value method allowed under APB Opinion 25 and, as such, generally recognizes no compensation cost for employee stock options. Accordingly, the adoption of SFAS No. 123R fair value method will have a significant impact the Company’s results of operations, although it will have no impact on our overall financial position. The impact of adoption of SFAS No. 123R cannot be predicted at this time because it will depend on levels of share-based payments granted in the future. However, had we adopted SFAS No. 123R in prior periods, the impact would have approximated the amounts calculated using SFAS No. 123 as described in the disclosure of pro forma net loss and net loss per share in Note 3 to our consolidated financial statements.

ITEM 3: Quantitative and Qualitative Disclosures About Market Risk

We are potentially exposed to market risk associated with changes in foreign exchange and interest rates for which we selectively use financial instruments to reduce related market risks. An instrument is treated as a hedge if it is effective in offsetting the impact of volatility in our underlying exposure. We have also entered into instruments which are not effective derivatives under the requirements of SFAS No. 133, and therefore such instruments are not designated as hedges. All transactions are authorized and executed pursuant to our policies and procedures. Analytical techniques used to manage and monitor foreign exchange and interest rate risk include market valuations and sensitivity analysis.

The Company regularly invests excess cash in overnight repurchase agreements and interest-bearing investment-grade securities that we hold for the duration of the term of the respective instrument and are subject to changes in short-term interest rates. The Company believes that the market risk arising from holding these financial instruments is minimal.

The Company’s exposure to market risks associated with changes in interest rates relates primarily to the increase or decrease in the amount of interest income earned on its investment portfolio. The Company ensures the safety and preservation of invested funds by limiting default risks, market risk and reinvestment risk. The Company mitigates default risk by investing in investment grade securities. Declines in interest rates over time will, however, reduce the Company’s interest income.

Impact of Foreign Currencies

We sell products in many countries, and a substantial portion of sales and expenses are denominated in foreign currencies, principally in the Euro. During the nine months ended September 30, 2005, the U.S. dollar was weaker than the Euro compared to the nine months ended September 30, 2004. This increased our consolidated revenue growth by $4.8 million, or approximately 2.5%, expressed in U.S. dollars.

While we may from time to time hedge specifically identified cash flows in foreign currencies using forward contracts, this foreign currency activity historically has not been material. The maturities of the forward exchange contracts generally coincide with the settlement dates of the related transactions. Realized and unrealized gains and losses on these contracts are recognized in the same period as gains and losses on the hedged items. As of September 30, 2005, there were no foreign currency forward contracts outstanding.

Realized foreign exchange gains (losses) were approximately $0.1 million and ($0.2) million for the three months ended September 30, 2005 and 2004, respectively and approximately ($0.2) million and $0.0 million for the nine months ended September 30, 2005 and 2004, respectively. As we continue to expand internationally, we evaluate currency risks and may continue to enter into foreign exchange contracts from time to time to mitigate foreign currency exposure.

We have entered into foreign-denominated debt obligations. The currency effects of the debt obligations are reflected in interest and other income (expense), net, on the consolidated statement of operations. We also have foreign-denominated intercompany borrowing arrangements with our Bruker Daltonik GmbH subsidiary in Germany, our Bruker AXS GmbH subsidiary in Germany and our Bruker Nonius subsidiary in the Netherlands that affected accumulated other comprehensive income (loss). A 10% increase or decrease of the respective foreign exchange rate with our Bruker Daltonik GmbH subsidiary in Germany would result in a change in accumulated other comprehensive income (loss) of approximately $1.0 million. A 10% increase or decrease of the respective foreign exchange rate with our Bruker Nonius subsidiary in the Netherlands would result in a change in accumulated other comprehensive income (loss) of approximately $1.0 million or $(0.9) million, respectively. A 10% increase or decrease of the respective foreign exchange rate with our

Bruker AXS GmbH subsidiary in Germany would result in a translation gain (loss) of approximately $0.7 million or $(0.5) million, respectively.

Impact of Interest Rates

Our exposure related to adverse movements in interest rates is derived primarily from outstanding floating rate debt instruments that are indexed to short-term market rates and cash equivalents. Our objective in managing our exposure to interest rates is to decrease the volatility that changes in interest rates might have on our earnings and cash flows. To achieve this objective, we use a fixed rate agreement to adjust a portion of our debt that is subject to variable interest rates.

In the U.S., we have entered into an interest rate swap arrangement to limit the interest rate exposure on our $2.2 million industrial revenue bond to a fixed rate of 4.6%. We pay a 4.6% fixed rate of interest and receive a variable rate of interest based on the Bond Market Association Municipal Swap Index on a $2.2 million notional amount. Net interest payments or receipts are recorded as adjustments to interest expense. In addition, the instrument is recorded at fair market value on our balance sheet, and changes in the fair market value are recorded in current earnings. As of September 30, 2005, the fair value of the instrument was approximately $0.1 million, net of tax, and is recorded as a liability on the balance sheet.

In April 2002, we entered into two derivative financial instruments: a cross currency interest rate swap and an interest rate swap. The cross currency interest rate swap of 2 million Euro secures a fixed interest rate of 1.75% per annum until January 4, 2012. The interest rate swap of 3 million Euro reduces the 6-month EURIBOR rate by 1.80% per annum until January 4, 2007. We entered into the financial instruments to manage our exposure to interest rates and foreign exchange risk. During the year ended December 31, 1999, we entered into three financial instruments: an interest rate cap, an interest rate swap and a cross currency interest rate swap. By entering into these financial instruments, we obtained the right to borrow money at lower rates of interest. We continue to hold these financial instruments until we elect to exercise the options to borrow the money. Until the instruments become an effective hedge, the instruments are considered speculative and are marked-to-market through interest and other income (expense), net, in the consolidated statement of operations. The change in the fair value of these instruments was not material for any period presented. As of September 30, 2005, the fair value of these instruments was approximately $0.2 million, net of tax, and is recorded as a liability on the balance sheet.

A 10% increase or decrease in the average cost of our variable rate debt would not result in a material change in pre-tax interest expense.

Inflation

We do not believe inflation had a material impact on our business or operating results during the periods presented.

ITEM 4: Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

The term “disclosure controls and procedures” is defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”). The rules refer to the controls and other procedures designed to ensure that information required to be disclosed in reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified. The Company’s management, including the Company’s chief executive officer and chief financial officer, performed an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of September 30, 2005. Based on that evaluation and due to the material weaknesses in our internal control over financial reporting identified and disclosed in our Annual Report on Form 10-K, for the year ended December 31, 2004, we concluded that the Company’s disclosure controls and procedures were not effective as of September 30, 2005.

(b) Changes in Internal Controls over Financial Reporting

In our Annual Report on Form 10-K, for the year ended December 31, 2004, we identified and disclosed material weaknesses in our internal control over financial reporting at one significant subsidiary whose operations and financial condition are significant to the Company’s consolidated financial statements. In response to these material weaknesses identified, we have taken steps to strengthen our internal controls over financial reporting. These steps have included the following:

• We evaluated and continue to evaluate the roles and functions within the significant subsidiary’s accounting department and added additional resources to support the controls surrounding inventory costing and the financial statement close process. Temporary staff had been used to perform additional procedures while management evaluated resources and systems.

Permanent personnel resources were also in place by the end of the third quarter of 2005. The additional resources together with the current accounting staff will improve existing policies and procedures to enable proper financial reporting.

• In addition to augmenting the Company’s accounting personnel, management’s long-term goal is to automate and establish certain preventative controls through the implementation of a fully integrated Materials Resource Planning (MRP) system. Management selected an MRP system during the third quarter of 2005 and expects the implementation to be completed during the first half of 2006.

Management believes that the above measures, when fully implemented, will address the material weaknesses described in our Annual Report on Form 10-K, for the year ended December 31, 2004, in the near and long-term. The Audit Committee and management will continue to monitor the effectiveness of our internal controls and procedures on an ongoing basis and will take further action, as appropriate.

During the nine month period ended September 30, 2005, there were no other significant changes in the Company’s internal control over financial reporting that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. The Company will continue to include reports on its progress in these areas in its quarterly filings with the SEC.

It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the control system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

The statements contained in Exhibits 31.1 and 31.2 should be considered in light of, and read together with, the information set forth in this Item 4.

PART II OTHER INFORMATION

ITEM 1: Legal Proceedings

General

The Company may, from time to time, be involved in legal proceedings in the ordinary course of business. The Company is not currently involved in any pending legal proceedings that, either individually or taken as a whole, are reasonably likely in management’s judgment to materially harm our business, prospects, results of operations or financial condition, nor have any such legal proceedings been threatened.

ITEM 2: Unregistered Sales of Equity Securities and Use of Proceeds

None.

ITEM 3: Defaults Upon Senior Securities

None.

ITEM 4: Submission of Matters to a Vote of Security Holders

None.

ITEM 5: Other Information

None.

ITEM 6: Exhibits

+2.2		Purchase and Transfer Agreement for Shares in Röntec AG dated October 10, 2005 between Bruker AXS GmbH and the Sellers as defined therein (1).
+2.3		Asset Purchase Agreement dated October 21, 2005 between Bruker AXS Inc., Princeton Gamma-Tech Instruments, Inc., Princeton Gamma-Tech (UK), Ltd., Finn-Partners, Inc. and Third Letter Corporation (1).
31.1		Certification by Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (1).
31.2		Certification by Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (1).
32.1		Certification by Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.
		Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (2).

(1) Filed herewith

(2) Furnished herewith

(+) Confidential treatment requested as to certain poertions, which portions have been omitted and filed separately with the Commission.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	BRUKER BIOSCIENCES CORPORATION

	By:	/s/ Frank H. Laukien, Ph.D.
Date: November 9, 2005		Frank H. Laukien, Ph.D. President, Chairman, Chief Executive Officer, and Director (Principal Executive Officer)

	By:	/s/ William J. Knight
Date: November 9, 2005		William J. Knight Chief Financial Officer (Principal Financial and Accounting Officer)

EX-2.2 2 a05-18563_1ex2d2.htm PLAN OF ACQUISITION, REORGANIZATION, ARRANGEMENT, LIQUIDATION OR SUCCESSION

Exhibit 2.2

PURCHASE AND TRANSFER AGREEMENT
FOR SHARES IN

RÖNTEC AKTIENGESELLSCHAFT

WITH ITS REGISTERED OFFICE IN BERLIN


	PURCHASE AND TRANSFER AGREEMENT


	between


	Bruker AXS GmbH
	Östliche Rheinbrückenstraße 50
	D-76167 Karlsruhe

	- hereinafter referred to as the “Purchaser” -


	and

	1.	bmp Aktiengesellschaft
		Alt-Moabit 59-61
		D-10555 Berlin

	2.	bmp Venture Tech GmbH
		Alt-Moabit 59-61
		D-10555 Berlin

	3.	Ventegis Capital AG
		Kurfürstendamm 119
		D-10711 Berlin

	4.	Mr. Martin Gander
		***

	5.	Mr. Andreas Gatzke
		***

	6.	Mr. Gert Kommichau
		***

	7.	Mr. Klaus Kromer
		***

	8.	Mr. Gerd Liebezeit
		***

	9.	Mr. Manfred Maneck
		***


	10.	Mr. Olaf Meibaum
		***

	11.	Mr. Detlef Meinhardt
		***

	12.	Mr. Rainer Schädlich
		***

	13.	Herrn Thomas Schülein
		***

	14.	Herrn Prof. Norbert Langhoff
		***

	15.	Herrn Ulrich Waldschläger
		***

- hereinafter referred to individually or together as the “Sellers” -

- the Sellers Nos. 4 through 15 are referred to individually and together as the “Old Shareholders”, and the Sellers Nos. 1 through 3 are also referred to individually and jointly as the “Financial Investors” -

- the Seller No. 1 is also referred to hereinafter as “bmp AG” -

- the Sellers and the Purchaser will hereinafter also be referred to individually as a “Party” and together as the “Parties” -

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

TABLE OF CONTENTS
LIST OF DEFINITIONS
LIST OF EXHIBITS
PREAMBLE
§ 1 COMPANY DETAILS
1.1	Company Details
1.2	Share Capital of RÖNTEC AG
1.3	Effective Transfer Date
§ 2 SALE OF SHARES; ENTITLEMENT TO DIVIDENDS
2.1	Sale of Shares
2.2	Transfer; Consents
§ 3 PURCHASE PRICE; PAYMENT METHOD
3.1	Base Purchase Price
3.2	Adjustment of the Purchase Price
3.3	Due Date, Allocation and Payment of the Purchase Price
§ 4 PURCHASE PRICE INCREASE
4.1	Supplemental Purchase Price 2006
4.2	Supplemental Purchase Price 2007
4.3	Determination of the Relevant Turnover
4.4	Due Date, Payment and Adjustment of the Supplemental Purchase Prices
4.5	Loss of Claim for Payment of a Supplemental Purchase Price
§ 5 INDEPENDENT GUARANTEES OF THE SELLERS
5.1	Form and Scope of the Guarantees by the Sellers
5.2	Ownership of the Shares
5.3	Company Law Situation
5.4	Participations
5.5	Inter-company Agreements
5.6	No Insolvency Proceedings
5.7	Annual Financial Statements
5.8	Contingent Liabilities
5.9	Futures Transactions / Options
5.10	Loan Agreements / Liabilities owed to Banks
5.11	Security / Liability for Obligations of Third Parties
5.12	Assets
5.13	Intellectual Property Rights
5.14	Company Name
5.15	Lease and Similar Agreements

5.16	Procurement
5.17	Service Agreements
5.18	Consulting Agreements
5.19	Distribution Agreements
5.20	Personnel
5.21	Continuation of Material Agreements
5.22	Customer Relations
5.23	Insurance
5.24	Disputes
5.25	Warranties
5.26	Products
5.27	Compliance
5.28	Environment
5.29	Public Subsidies
5.30	Restrictions on Competition
5.31	Business Dealings with the Sellers
5.32	Complete Disclosure
5.33	Brokers
5.34	Assets of the Sellers
§ 6 CONSEQUENCES OF BREACH
6.1	Compensatable Damage
6.2	Liability of the Sellers for the Guarantees under Clause 5
6.3	Exempt Amount, Total Exempt Amount
6.4	Knowledge of the Purchaser
6.5	Notice to the Sellers; Proceedings in the Case of Third Party Claims
6.6	Mitigation of Loss, Exclusion of Liability
6.7	Limitations Period
6.8	Exclusion of further Claims
§ 7 TAX WARRANTIES AND INDEMNIFICATION
7.1	Tax Guarantee
7.2	Damages based on Tax Guarantees
§ 8 DISCHARGE OF RÖNTEC AG’S LIABILITIES
8.1	Release from Liabilities under Loans and other Liabilities
§ 9 INDEMNIFICATIONS AND COVENANTS OF THE SELLERS
9.1	Limitations Period; Scope of Liability
9.2	Proceedings in the Case of Indemnification Claims
9.3	Indemnification in connection with Silent Participations
§ 10 MATERIAL ADVERSE CHANGE
§ 11 VESTING
§ 12 PROHIBITION ON COMPETITION
12.1	Prohibition on Competition for the Sellers
12.2	Participations in a competitive Enterprise
12.3	Activity for RÖNTEC AG
12.4	Contract Penalty [Strafversprechen]

§ 13 CONFIDENTIALITY AND PRESS RELEASES
13.1	Confidentiality; Press Releases; Public Announcements
13.2	Confidentiality on the part of the Sellers
§ 14 ASSIGNMENT OF RIGHTS AND OBLIGATIONS
§ 15 CONTINUATION OF THE BUSINESS OPERATIONS
§ 16 POWER OF ATTORNEY FROM THE SELLERS
§ 17 TAXES AND COSTS
17.1	Taxes
17.2	Costs
§ 18 NOTICES
18.1	Form of Notices
18.2	Notices to the Sellers
18.3	Notices to the Purchaser
18.4	Changes in the Addresses
§ 19 FINAL PROVISIONS
19.1	Applicable Law
19.2	Jurisdiction and Venue
19.3	Amendments, Supplements and Cancellations
19.4	Headings
19.5	Exhibits
19.7	Severability Clause

LIST OF DEFINITIONS

Share/Shares	see the Preamble
Old Shareholders	see page 3
Banking Day	every day on which banks are open in Frankfurt am Main
Base Purchase Price	see Clause 3.1
bmp AG	see page 3
Bruker-Röntec Division	is the business division currently operated by RÖNTEC AG in Berlin, which will continue to be conducted in Berlin, if applicable after a transformation [Umwandlung] of RÖNTEC AG or a merger [Verschmelzung] of RÖNTEC AG with the Purchaser. If in the future the Purchaser wants to locate its own divisions or divisions which are still to be acquired on the site of RÖNTEC AG in Berlin, these divisions are not to be attributed to the Bruker-Röntec Division for the purposes of this Agreement and especially not for the purpose of determining turnover in order to calculate an increase in the Purchase Price pursuant to § 4.
Retention Amount	see Clause 3.3
Supplemental Cash Purchase Price 2006 and 2007	see Clause 4.4.1

Supplemental Purchase Price 2006	see Clause 4.1
Supplemental Purchase Price 2007	see Clause 4.2
Supplemental Purchase Price in Kind 2006 and 2007	see Clause 4.4.1
Financial Investors	see page 3
Indemnification Claims	see Clause 9.2
Company	see the Preamble
Maximum Liability Amount	see Clause 6.2
Annual Financial Statements	see Clause 3.3.1
Purchaser	see page 2
Sellers’ Knowledge	see Clause 5.1.4
Small Shareholders	stockholders of RÖNTEC AG each holding less than 0.5% of the shares in RÖNTEC AG
Minimum Amount	see Clause 6.3
Party / Parties	see page 3
Reduction Amount	see Clause 3.2
Registered Shares	see Clause 3.2.2
RÖNTEC AG	see Preamble
RönTec GmbH	see Preamble
Threshold Amount	see Clause 6.3
Effective Transfer Date	see Clause 1.3
Sold Shares	see Clause 2.1
Seller	see page 3
Closing Date	see Clause 2.2.1

LIST OF EXHIBITS

Exhibit P1	Copy of the Share Register of RÖNTEC AG
Exhibit P3	Draft of the Purchase and Transfer Agreement with all Small Shareholders, each holding less than 0.5% of the shares in RÖNTEC AG
Exhibit P4 (Part 1)	List of Shares and Shareholders of RÖNTEC AG;
Exhibit P4 (Part 2)	Index of the Sellers and the Sold Shares they own;
Exhibit P4 (Part 3)	Allocation of the Purchase Price among the Sellers;
Exhibit P4 (Part 4)	Bank Accounts of the Sellers;
Exhibit 3.2.	Subsidies for Subsidy Periods after the Closing Date
Exhibit 3.3.8	Sample Confirmation of Receipt of the Purchase Price
Exhibit 3.3.5	Confirmation by the Secretary of Bruker BioSciences Corporation of the Transfer of Title to the Registered Shares
Exhibit 3.3.3	Summary of the SEC Trading Restrictions
Exhibit 3.3.8	Sample Confirmation of Receipt of the Purchase Price
Exhibit 5.3.1	Excerpt from the Commercial Register and Articles of RÖNTEC AG
Exhibit 5.3.2	Agreements on Silent Partnerships with bmp AG, bmp Venture Tech GmbH and Venegis Capital AG
Exhibit 5.8	List of the Company’s Contingent Liabilities
Exhibit 5.10	List of all of the Company’s Loan Agreements / Liabilities owed to Banks
Exhibit 5.13	List of all Patents, Trademarks and Intellectual Property Rights of the Company
Exhibit 5.15	The Company’s Leases and Long Term Contractual Relationships
Exhibit 5.16	Procurement Agreements of the Company

These exhibits are omitted in accordance with Item 601(b)(2) of Regulation S-K. The Registrant will furnish a copy of any omitted annex or exhibit to the Securities and Exchange Commission supplementally upon request.

Exhibit 5.17	Service Agreements of the Company
Exhibit 5.18	Consulting Agreements of the Company
Exhibit 5.19	Distribution Agreements and Commercial Agency Agreements of the Company
Exhibit 5.23	List of all Insurance Agreements of the Company
Exhibit 5.25	Warranties given by the Company
Exhibit 5.27	Compliance
Exhibit 5.30	Restrictions on Competition
Exhibit 5.31	List of Agreements between the Sellers and RÖNTEC AG
Exhibit 6.1.2.a	Disclosure Letter
Exhibit 6.1.2.b	Due Diligence Report of CMS Hasche Sigle
Exhibit 6.1.2.c	Letter from William Knight dated 20 September 2005
Exhibit 8.	List of Liabilities for Release
Exhibit 11	Stock Repurchase Agreement between various Old Shareholders and Bruker BioSciences Corporation

PREAMBLE

The Sellers hold a total of 3,035,080 shares of registered common stock in RÖNTEC Aktiengesellschaft, with each share having a notional par value of EUR 1.00. RÖNTEC Aktiengesellschaft has its registered office in Berlin, is registered in the Commercial Register of the Local Court Charlottenburg[Amtsgericht] of Berlin under no. HRB 72789 and has a share capital of EUR 3,064,968 (in words: three million sixty-four thousand nine hundred and sixty-eight Euros) (hereinafter referred to as “RÖNTEC AG” or also as the “Company”). The share capital is divided into a total of 3,064,968 shares of registered common stock, each having a notional par value of EUR 1.00 (hereinafter collectively referred to as the “Shares” or individually as a “Share”).

A copy of the share register of RÖNTEC AG, status 7 October 2005, is attached as Exhibit P1.

The Purchaser is registered in the Commercial Register of the Local Court of Karlsruhe under no. HRB 7524. The Purchaser has its registered office in Karlsruhe.

RÖNTEC AG is active in the field of planning, development, production and distribution of devices for materials and structural analysis using x-rays, including applications in industry, research and academics. The Company provides products in the form of complex system solutions consisting of hardware and software, especially x-ray spectrometers for x-ray microanalysis, micro x-ray fluoroscopic spectrometers for the analysis of works of art, total reflection spectrometers for environmental and trace analysis, energy dispersion x-ray diffractometers for determining single crystal characteristics as well as x-ray detectors for various applications.

There are contracts on establishing silent partnerships [stille Gesellschaften] between RÖNTEC AG and Ventegis Capital AG, Berlin (Local Court of Charlottenburg, no. HRB 57882), bmp Venture Tech GmbH, Berlin (Local Court of Charlottenburg, no. HRB 68302) and bmp Mobility AG Venture Capital, Berlin (Local Court of Charlottenburg, no. HRB 65607). These silent partnerships were initially concluded with RönTec-Gesellschaft für Röntgenanalysen-Technik mbH (hereinafter referred to as “RönTec GmbH”) and were transferred to RÖNTEC AG after RönTec GmbH was merged with this company. bmp Mobility AG Venture Capital, which in the meantime has changed its name to bmp eBusiness AG Venture Capital, transferred its rights under the silent partnership by an agreement of 28 June 2000 to bmp Life Science AG, Berlin (Local Court of Charlottenburg, HRB 67465). Both bmp Mobility AG Venture Capital, which changed its name to bmp eBusiness AG, as well as bmp Life Science AG have been merged in the meantime with bmp Aktiengesellschaft, Berlin (Local Court of Charlottenburg, HRB 64077B), so that bmp Aktiengesellschaft, bmp Venture Tech GmbH as well as Ventegis Capital AG hold silent participations in RÖNTEC AG.

Under the above silent partnerships, RÖNTEC AG is required to surrender part of its profits.

RÖNTEC AG has granted Prof. Norbert Langhoff an option to acquire *** shares in RÖNTEC AG under a convertible bond dated 18 November 2002.

The Sellers as well as all other shareholders in RÖNTEC AG intend to sell 100 % of the share capital in RÖNTEC AG, i.e. all 3,064,968 shares. The Purchaser intends to acquire the above Shares. It is intended that those shareholders in RÖNTEC AG, who are not parties to this Agreement and who each hold less than 0.5 % of the Shares of RÖNTEC AG (hereinafter, the “Small Shareholders”) will sell and transfer all of the shares they hold in RÖNTEC AG to the Purchaser under a separate share purchase and transfer agreement. The draft of this agreement is attached as Exhibit P3.

The Purchaser also intends after acquiring all shares in RÖNTEC AG to transform the legal form into a company with limited liability [Gesellschaft mit beschränkter Haftung] and then change the fiscal year to the calendar year. This can also be accomplished by merging RÖNTEC AG with the Purchaser, whereby the division of the current RÖNTEC AG would then be continued, for example, as “Bruker-Röntec Division” at the site in Berlin as a branch of the Purchaser.

The Purchaser also intends to strengthen the equity capital of RÖNTEC AG after the above acquisition of all shares in RÖNTEC AG. This can be accomplished on the one hand by obtaining releases from the current liabilities of RÖNTEC AG owed to third parties, and also by direct contribution of funds to RÖNTEC AG.

The Parties are aware that the Exhibits attached to this Agreement are presently not complete and also are only preliminary in nature, meaning that changes in these Exhibits can occur up to the Closing Date. The final Exhibits, which are supposed to be binding on the Parties, will be exchanged between the Parties on the Closing Date and will be attached to this Agreement.

Now therefore, the Parties agree as follows:

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

	§ 1 COMPANY DETAILS
1.1	Company Details
	RÖNTEC AG is a stock corporation [Aktiengesellschaft] existing under German law with the name “RÖNTEC Aktiengesellschaft”, which has its registered office in Berlin and is registered in the Commercial Register of the Local Court of Charlottenburg under no. HRB 72789.
1.2	Share Capital of RÖNTEC AG
	The share capital of RÖNTEC AG is EUR 3,064,968.00 (in words: three million sixty-four thousand nine hundred sixty-eight Euros) and is fully paid in. The share capital consists of 3,064,968 registered shares of common stock having a notional value of EUR 1.00 each, which are held as set forth in Exhibit P4 (Part 1). All shares and the shareholders listed in Exhibit P4 (Part 1) are registered in the Share Register of RÖNTEC AG. The shares do not have certificates.
1.3	Effective Transfer Date
	The effective transfer date within the meaning of this Purchase and Transfer Agreement is 7 October 2005, 24:00 hours (hereinafter referred to as the “Effective Transfer Date”).

	§ 2 SALE OF SHARES; ENTITLEMENT TO DIVIDENDS
2.1	Sale of Shares
	The Sellers hereby sell to the Purchaser, which accepts the sale, all shares in RÖNTEC AG which they hold and are listed in Exhibit P4 (Part 2) (hereinafter referred to as the “Sold Shares”) with economic effect as of the Effective Transfer Date pursuant to the provisions of this Purchase and Transfer Agreement. The sale of the Sold Shares includes all related claims and other rights including the right to a dividend for the current fiscal year and all previous fiscal years.

2.2	Transfer; Consents
	Subject to the condition precedent of payment of the Base Purchase Price pursuant to Clauses 3.1, 3.3.1, 3.3.3 through 3.3.6 minus a withheld amount of EUR * under Clause 3.3.1 for the Financial Investors, the Sellers transfer to the Purchaser the Sold Shares under Clause 2.1 including all related claims and other rights such as the dividend right for the current fiscal year and all past fiscal years. In execution hereof, the Sellers assign to the Purchaser the Sold Shares subject to the above condition precedent. The Purchaser accepts the assignment. The date on which the Base Purchase Price under Clauses 3.1, 3.3.1, 3.3.3 through 3.3.6 minus the Retention Amount for the Financial Investors under Clause 3.3.1 is paid to the Sellers and title to the Sold Shares thereby passes to the Purchaser is hereinafter referred to as the “Closing Date**”.
	§ 3 PURCHASE PRICE; PAYMENT METHOD
3.1	Base Purchase Price
	The Purchase Price to be paid by the Purchaser to the Sellers for the Sold Shares which are sold and transferred under Clause 2.1 of this Purchase and Transfer Agreement as well as for all other performance and actions of the Sellers pursuant to this Purchase and Transfer Agreement is EUR 3,085,119.00, hereinafter referred to as the “Base Purchase Price”), which is allocated to the Sellers in accordance with the information in Exhibit P4 (Part 3).
3.2	Adjustment of the Purchase Price
	If the subsidies for subsidy periods after the Closing Date listed in Exhibit 3.2 are reduced during a period of 12 calendar months after the Closing Date compared to the amount set forth in Exhibit 3.2 because the acquisition of the shares in RÖNTEC AG by the Purchaser means that the prerequisites for a continued grant of the listed subsidies are no longer met, the share of the Base Purchase Price under Clause 3.1 allocable to the Financial Investors and, thus, the Base Purchase Price itself will be reduced by a total of *** of the amount by which the subsidies listed in Exhibit 3.2 in the mentioned period of time are reduced compared to the amounts listed in Exhibit 3.2 (the amount by which the Base Purchase Price is reduced under the above calculation is hereinafter
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

	referred to as the “Reduction Amount”. The Reduction Amount is limited to a maximum of EUR * and is allocated to the Financial Investors in a manner proportionate to their respective interests in the Base Purchase Price as set forth in Exhibit P4** (Part 3). The Purchase Price will not be adjusted if a final and binding subsidy ruling has been presented to the Purchaser prior to the applicable reduction in the subsidies, and such ruling provides an assurance that the subsidies listed in Exhibit 3.2 will not be reduced below the amounts listed in Exhibit 3.2 on the grounds that the prerequisites for the further grant of the listed subsidies continue to exist despite the acquisition of the shares in RÖNTEC AG by the Purchaser.
3.3	Due Date, Allocation and Payment of the Purchase Price
3.3.1	The Base Purchase Price minus a retained amount of EUR * (hereinafter referred to as the “Retention Amount*”) is to be paid pursuant to the provisions in Clauses 3.3.3 et seq*. within five Banking Days after all of the following conditions have occurred:
	a)	Proof of the extension of the existing lease agreement between RÖNTEC AG and WISTA AG for the property currently used by RÖNTEC AG in Schwarzschildstrasse 12, 12489 Berlin. The extension must be for a period of at least 3 years and on the current conditions;
	b)	Presentation of a confirmation from WISTA AG that it will not terminate the lease with RÖNTEC AG for the property currently used by RÖNTEC AG in Schwarzschildstrasse 12, 12489 Berlin, as a result of the transfer of a majority of the shares or all of the shares in RÖNTEC AG to the Purchaser;
	c)	Valid conclusion of the share purchase and transfer agreement with the Small Shareholders of RÖNTEC AG attached as Exhibit P3;
	d)	Presentation of a confirmation from the * that RÖNTEC AG has properly and fully settled all license fees * in the past;
	e)	Valid conclusion of a Stock Repurchase Agreement pursuant to Exhibit 11 between Bruker BioSciences Corporation and each Old shareholder, except for the Old shareholders Martin Gander, Rainer Schädlich, Gerd Liebezeit and Prof. Dr. Norbert Langhoff;
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

	f)	Presentation of the audited annual financial statements of RÖNTEC AG for the fiscal year ending on 30 June 2005, affixed with an unqualified auditor’s opinion (hereinafter referred to as the “Annual Financial Statements 2005”, and together with the annual financial statements for 30 June 2004, the “Annual Financial Statements”);
	g)	All members of the Supervisory Board have given written notices of resignation, according to which each of them resigns from his office as a member of the Supervisory Board effective at the point in time of transfer of all shares in RÖNTEC AG to the Purchaser;
	h)	The shareholders’ meeting of RÖNTEC AG has consented to the transfer of the 219,351 shares of common stock to Ventegis Capital AG under the agreement of 29 October/3 November 2004, to the transfer of all Shares to the Purchaser as well as the cancellation of the agreements on partial transfer of profits with bmp Aktiengesellschaft, bmp Venture Tech GmbH and Ventegis Capital AG;
	i)	Cancellation of the option agreement between RÖNTEC AG and Prof. Norbert Langhoff as well as conclusion of an agreement with Prof. Norbert Langhoff to the effect that the bond of RÖNTEC AG in the nominal amount of EUR 5,000.00 which was subscribed to by Prof. Norbert Langhoff will be redeemed in the near future;
	j)	Approval of all resolutions adopted by the shareholders’ meeting of RÖNTEC AG since 2 April 2002 by the two equally entitled beneficiaries of the estate of Hans-Eberhard Gorny, Valentina Gorny and Xenia Gorny;
	k)	Presentation of all completed Exhibits to this Agreement in a form acceptable to all Parties and written confirmation of the Parties or their representatives to this effect;
	l)	Cancellation of all existing participation agreements between shareholders in RÖNTEC AG and RÖNTEC AG itself, if any;
	m)	Conclusion of a cancellation agreement for the silent partnerships/partial transfer of profits agreements listed in Exhibit 5.3.2 with bmp Aktiengesellschaft, bmp Venture Tech GmbH and Ventegis Capital AG effective as of the Closing Date;
	n)	Performance of a due diligence examination at RÖNTEC USA Inc. with a result satisfactory to the Purchaser.

	The Purchaser is entitled to completely or partially waive the occurrence of the above conditions by declaration to the Sellers. If the above conditions precedent have not occurred by no later than 18 November 2005 or, in the case of non-occurrence, if the Purchaser has not waived the occurrence of the respective condition which has not occurred by no later than 18 November 2005, the Purchaser on the one hand and the Sellers holding at least 45% of the share capital acting jointly on the other hand can withdraw from this Agreement by declaration given to the Sellers. Sellers who jointly hold at least 45% of the share capital and act jointly are entitled in the case of the non-occurrence of the condition under point k) to withdraw regardless of any declaration of waiver by the Purchaser, but not before 19 November 2005. If the Purchaser withdraws from this Agreement pursuant to this Clause 3.3.1, claims of the Sellers against the Purchaser based on or as a result of the withdrawal from this Agreement are excluded.
3.3.2	The Retention Amount allocated to the Financial Investors in the amount of EUR *, minus any Reduction Amount under Clause 3.2, is to be paid within 15 Banking Days of the earlier of 15 March 2007 or the date upon which a final and binding subsidy ruling is presented, according to which the subsidies listed in Exhibit 3.2 will not be reduced below the amounts listed in Exhibit 3.2 on the grounds that the conditions for the continuing grant of the listed subsidies are no longer present as a result of the acquisition of the Shares in RÖNTEC AG by the Purchaser; to the extent that the date determined in the above manner is not a Banking Day, payment shall be made on the next Banking Day. The payments are to be made to the Financial Investors proportionate to their respective interests in the Base Purchase Price, as set forth in Exhibit P4** (Part 3).
3.3.3	The Base Purchase Price less the Retention Amount is to be paid to the Financial Investors and the Old Shareholders as follows: the amount payable to the Financial Investors must be wholly rendered in cash, while 25% of the amount payable to the Old Shareholders must be rendered in cash and 75% must be in the form of registered shares (each with a par value of US Dollars 0.01) in the American company, Bruker BioSciences Corporation, with its registered office in Billerica, MA 01821, USA (hereinafter, the “Registered Shares”). The Purchaser guarantees that it is able to transfer to the respective Sellers title to the Registered Shares free of title rights of third parties as part of the Base Purchase Price. This does not apply to the rights resulting under the Stock Repurchase Agreement pursuant to Exhibit 11 which must still be concluded.
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

3.3.4	The Base Purchase Price is allocated to the individual Sellers on a proportionate basis as set forth in Exhibit P4 (Part 3). To the extent that the Base Purchase Price under Clause 3.2 is to be adjusted for any Reduction Amount, the adjustment only affects the Financial Investors proportionate to their respective interests in the Base Purchase Price as set forth in Exhibit P4 (Part 3).
3.3.5	To the extent that the Base Purchase Price is to be paid in cash, it is to be paid by transfer to the bank accounts set forth for each Seller in Exhibit P4 (Part 4). To the extent that the Base Purchase Price is to be paid to the Old Shareholders in the form of Registered Shares, the number of Registered Shares calculated according to the provision in Clause 3.6 is to be transferred to the Old Shareholders, and the transfer of title is to be confirmed by the Secretary of Bruker BioSciences Corporation using the draft letter attached as Exhibit 3.3.5, and copies of the stock certificates are to be presented. Upon confirmation by the Secretary of Bruker BioSciences Corporation, the Registered Shares to be transferred to the Old Shareholders on a proportionate basis as part of the Base Purchase Price are also deemed to have been provided for purposes of fulfilling the condition precedent set forth in Clause 2.2.
3.3.6.1	The number of Registered Shares to be transferred to the respective Old Shareholders is calculated by allocating 75% of the Base Purchase Price to be paid to each Old Shareholder, exchanged into US Dollars at the exchange rate applicable on the Effective Transfer Date, which amount is then divided by the average price over the last 3 months prior to the Effective Transfer Date for the Registered Shares traded on the Nasdaq.
3.3.6.2	When calculating the Registered Shares to be allocated to the individual Old Shareholders, the number of Registered Shares for the respective Old Shareholder is to be rounded up to the next whole number. For example, if an Old Shareholder is to notionally receive 100.21 Registered Shares, the Old Shareholder should receive a total of 101 Registered Shares after rounding.
3.3.6.4	The exchange rate applicable for exchanging Euros into US Dollars as of the Effective Transfer Date is to be determined as follows: the rate fixed at 13:00 by Deutsche Bank (DBREF), according to the information under www.db-markets.de. The exchange rate as of the Effective Transfer Date of 7 October 2005 is, therefore, 1.2145 US$ = 1 EUR.
3.3.7	The Old Shareholders, except for the Old Shareholders Martin Gander, Rainer Schädlich, Gerd Liebezeit and Prof. Dr. Norbert Langhoff, are restricted in their ability to transact with the Registered Shares received as purchase price in kind in accordance with the provisions in the Stock Repurchase Agreement attached as Exhibit 11. All Sellers are also instructed that the Registered

	Shares are subject to the SEC Trading Restrictions and that the Sellers must comply with these. A brief summary of the SEC Trading Restrictions is attached as Exhibit 3.3.3.
3.3.8	Each Seller personally undertakes to confirm to the Purchaser the receipt of the respective Purchase Price pursuant to Exhibit P4 (Part 3) in the bank accounts set forth in Exhibit P4 (Part 4) without undue delay after receipt of payment. The Sellers will issue the declaration of confirmation using the form attached as Exhibit 3.3.8.

	§ 4 PURCHASE PRICE INCREASE
4.1	Supplemental Purchase Price 2006
	The Purchase Price for the Old Shareholders is to be increased by *** of the amount by which the turnover [Umsatz] of RÖNTEC AG or the Bruker-Röntec Division exceeds an amount of EUR * during the period between 1 January 2006 and 31 December 2006 (hereinafter referred to as the “Supplemental Purchase Price 2006”). Thus, if the turnover of Bruker-Röntec Division does not exceed the amount of EUR * in the stated period of time, no Supplemental Purchase Price 2006 is to be paid. In the event that the Bruker Röntec Division is expanded in the field of x-ray microanalysis by the acquisition of other activities, the Supplemental Purchase Price 2006 is limited to a total amount of EUR *. The maximum amount of EUR * results from subtracting the amount allocable to the Small Shareholders (EUR *) from EUR . The Supplemental Purchase Price 2006 will be distributed among the Old Shareholders Pursuant to the information in Exhibit P4* (Part 3). The Financial Investors do not receive any portion of the Supplemental Purchase Price 2006.
4.2	Supplemental Purchase Price 2007
	The Purchase Price allocable to the Old Shareholders is to be further increased by * of the amount by which the turnover of RÖNTEC AG or the Bruker-Röntec Division during the period between 1 January 2007 and 31 December 2007 exceeds the turnover during the period between 1 January 2006 and 31 December 2006 (hereinafter referred to as the “Supplemental Purchase Price 2007**”). If the turnover during the period between 1 January 2006 and 31
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

	December 2006 is less than EUR *, the Supplemental Purchase Price 2007 is * of the amount by which the turnover of the Bruker-Röntec Division during the period between 1 January 2007 and 31 December 2007 exceeds EUR *. Thus, if the turnover of the Bruker-Röntec Division during the period between 1 January 2007 and 31 December 2007 does not exceed EUR , or if it does not exceed the turnover during the period between 1 January 2006 and 31 December 2006, no Supplemental Purchase Price 2007 is to be paid. In the event that the Bruker-Röntec Division is expanded in the field of x-ray microanalysis by the acquisition of other activities, the Supplemental Purchase Price 2007 is limited to a total of EUR . The maximum amount of EUR * results from subtracting the amount allocable to the Small Shareholders (EUR *) from EUR . The Supplemental Purchase Price 2007 will be distributed among the Old Shareholders Pursuant to the information in Exhibit P4* (Part 3). The Financial Investors do not receive any portion of the Supplemental Purchase Price 2007.
4.3	Determination of the Relevant Turnover
4.3.1	The turnover used to determine the Supplemental Purchase Price 2006 and the Supplemental Purchase Price 2007 during the periods set forth in Clauses 4.1 and 4.2 is to be determined on the basis of US GAAP as applied by the Purchaser. The Old Shareholders, to the extent that they are in a service or employment relationship with RÖNTEC AG, undertake not to shift turnover of RÖNTEC AG or the Bruker-Röntec Division ordinarily anticipated in the calendar year 2005 to the calendar year 2006 or to shift turnover ordinarily anticipated in the calendar year 2007 or 2008 to the respective preceding calendar year.
4.3.2	To the extent that product lines of the Bruker-Röntec Division are moved to other sites of the Purchaser, the turnover of Bruker-Röntec generated there is to be added for purposes of calculating the Supplemental Purchase Prices.
4.3.3	Thomas Schülein is exclusively entitled to manage and supervise, alone and/or with the help of advisers, the preparation and audit of the turnover figures for the stated calendar years and to inspect the relevant documents.
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

4.4	Due Date, Payment and Adjustment of the Supplemental Purchase Prices
4.4.1	With regard to the portions of the Supplemental Purchase Price 2006 and the Supplemental Purchase Price 2007 payable to the Old Shareholders, 50% is to be paid in cash (“Supplemental Cash Purchase Price 2006” or “Supplemental Cash Purchase Price 2007”) and 50% is to be paid in Restricted Shares (“Supplemental Purchase Price in Kind 2006 or “Supplemental Purchase Price in Kind 2007”) to the Old Shareholders.
4.4.2	The Supplemental Cash Purchase Price 2006, the Supplemental Cash Purchase Price 2007 and the Supplemental Purchase Price in Kind 2007 to be determined and paid to the Old Shareholders pursuant to the provisions in Clauses 4.1, 4.2 and 4.4.1 is reduced, however, by the Reduction Amount, i.e. by a total of 50% of that amount by which the subsidies for subsidy periods after the Closing Date set forth in Exhibit 3.2 are reduced during a period of 12 calendar months after the Closing Date; the reduction shall not, however, exceed EUR 100,000.00. The Reduction Amount is first to be set off against the Supplemental Cash Purchase Price 2006 and, in the event that the Reduction Amount exceeds the Supplemental Cash Purchase Price 2006, the difference is then to be set off against the Supplemental Cash Purchase Price 2007 and, in the event that the Reduction Amount exceeds the Supplemental Cash Purchase Price 2006 and the Supplemental Cash Purchase Price 2007, any remaining difference shall be set off against the Supplemental Purchase Price in Kind 2007.
4.4.3	The Supplemental Cash Purchase Price 2006 and the Supplemental Purchase Price in Kind 2006 are due for payment on 15 March 2007; the Supplemental Cash Purchase Price 2007 and the Supplemental Purchase Price in Kind 2007 are due on 15 March 2008 or, if any of the above dates is not a Banking Day, on the next Banking Day, in each case less any reductions pursuant to Clause 4.4.2.
4.4.4	The Supplemental Cash Purchase Price 2006 and the Supplemental Cash Purchase Price 2007, less any reductions under Clause 4.4.2, are allocated to the Old Shareholders proportionate to their respective interests in the Base Purchase Price as set forth in Exhibit P4 (Part 3) and are to be paid by transfer to the bank accounts of the respective Old Shareholder set forth in the above Exhibit. The provision under Clause 3.3.8 applies mutatis mutandis.
4.4.5	The Supplemental Purchase Price in Kind 2006 and the Supplemental Purchase Price in Kind 2007, less any reductions under Clause 4.4.2, are allocated to the Old Shareholders proportionate to their respective interests in the Purchase Price as set forth in Exhibit P4 (Part 3) and are to be rendered by transfer of Registered Shares to the Old shareholders. When determining the

	number of Registered Shares to be transferred as Supplemental Purchase Price in Kind 2006 and Supplemental Purchase Price in Kind 2007, the provisions in Clauses 3.3.6.1 through 3.3.7 apply accordingly, except that that the relevant rates for the exchange of Euros into US Dollars as well as for determining the relevant closing price of the Registered Shares traded on the Nasdaq will be determined as of 10 March 2007 for the Supplemental Purchase Price in Kind 2006 and on 10 March 2008 for the Supplemental Purchase Price in Kind 2007 or, to the extent that these dates are not Banking Days, on the next Banking Day.
4.4.6	The Purchaser is entitled at any time to pay the Supplemental Purchase Price in Kind 2006 or the Supplemental Purchase Price in Kind 2007 completely or partially in cash to the bank accounts of the Sellers set forth in Exhibit P3 (Part 4).
4.5	Loss of Claim for Payment of a Supplemental Purchase Price
	The claim of the Old Shareholders, except for the Old Shareholders Martin Gander, Rainer Schädlich, Gerd Liebezeit and Prof. Dr. Norbert Langhoff, for payment of a Supplemental Purchase Price 2006 and/or payment of a Supplemental Purchase Price 2007 is lost if the employment or service relationship with the relevant Old Shareholder is terminated by the relevant Old Shareholder prior to 15 March 2007 in the case of the Supplemental Purchase Price 2006 or before 15 March 2008 in the case of the Supplemental Purchase Price 2007. The claim of the Old Shareholders, except for the Old Shareholders Martin Gander, Rainer Schädlich, Gerd Liebezeit and Prof. Dr. Norbert Langhoff, for payment of a Supplemental Purchase Price in Kind 2006 and/or payment of a Supplemental Purchase Price in Kind 2007 is also lost if the employment or service relationship with the relevant Old Shareholder is terminated by RÖNTEC AG or its legal successor for good cause [wichtiger Grund] prior to 15 March 2007 in the case of the Supplemental Purchase Price in Kind 2006 or prior to 15 March 2008 in the case of the Supplemental Purchase Price in Kind 2007. For the purpose of the preceding sentence, only serious misconduct on the part of the Old shareholder concerned qualifies as good cause.

	§ 5 INDEPENDENT GUARANTEES OF THE SELLERS
5.1	Form and Scope of the Guarantees by the Sellers
5.1.1	The Sellers hereby guarantee to the Purchaser by way of an independent guarantee pursuant to § 311 para. 1 German Civil Code [Bürgerliches Gesetzbuch, “BGB”] and within the scope of the provisions of this Purchase and Transfer Agreement, especially the terms in Clause 6 of this Purchase and Transfer Agreement, that the statements contained in Clause 5.2 through Clause 5.35 of this Purchase and Transfer Agreement are correct on the date on which this Purchase and Transfer Agreement is concluded and on the Closing Date. The Seller and the Purchaser expressly agree that the guarantees in Clause 5 of this Purchase and Transfer Agreement are not guarantees as to the characteristics or qualities of an object within the meaning of §§ 443, 444 BGB and that § 444 BGB is not applicable to the guarantees given here. To the extent legally permissible and not expressly agreed otherwise in this Purchase and Transfer Agreement, the provisions in §§ 5, 6 and 7 constitute the totality of the agreements of the Parties with regard to the consequences of an incorrect guarantee by the Sellers. All other claims and warranties, regardless of how they arose, their scope or their legal basis, are expressly excluded. This applies especially also for claims based on violation of pre-contractual duties (§ 311 para. 2 and 3 BGB), violation of duties under a contractual relationship [Schuldverhältnis], defects as to quality or title defects [Sach- und Rechtsmängel], especially § 434 para. 1 BGB, claims for reduction of the Purchase Price, and claims based on disruption of the fundamental premises upon which the transaction is based [Störung der Geschäftsgrundlage]. The withdrawal from this Purchase and Transfer Agreement is also excluded except in the cases of Clause 3.3.1, § 10 and Clause 15.2.
5.1.2	Guarantees of bmp AG, bmp Venture Tech GmbH and Ventegis Capital AG
	The guarantees under Clauses 5.4 through 5.35 and in § 7 are given only to the best of the Financial Investors’ knowledge.
5.1.3	Knowledge of the Old Shareholders and the Financial Investors
	“Knowledge” of a Financial Investor within the meaning of this Purchase and Transfer Agreement refers to the actual knowledge of the respective Financial Investor; apart from actual knowledge, the “knowledge” of an Old Shareholder includes matters which the Old Shareholder ought to have known but for gross negligence.

5.1.4	Attribution of Knowledge
	The knowledge of one Old Shareholder will be attributed to the other Old Shareholders except for the Old Shareholders Martin Gander, Rainer Schädlich und Gerd Liebezeit
5.2	Ownership of the Shares
5.2.1	The Sellers are the sole, unrestricted legal and beneficial owners of the Shares sold pursuant to Clause 2.1. The information in the Share Register attached as Exhibit P1 is correct. Except for the shareholders and Shares mentioned in Exhibit P1, there are no other shareholders and/or Shares in RÖNTEC AG. The Shares are not represented by certificates.
5.2.2	The Shares have been validly issued. The contributions to be paid for them were completely and properly rendered in cash and/or as contributions in kind and have not been repaid (either openly or in a hidden manner). There are no obligations to make additional contributions. The Shares are free of encumbrances or other rights of third parties. There are neither trustee relationships, nor silent participations nor sub-participations in the Shares or similar agreements.
5.2.3	The Sellers can freely dispose of the Sold Shares after a corresponding resolution of the shareholders’ meeting consenting to this, and the Purchaser will receive unrestricted legal and beneficial title to the Sold Shares on the Closing Date.
5.2.4	The Sold Shares are not encumbered with any rights whatsoever of third parties. Neither the Sellers nor third parties have preemption rights, rights of first refusal, subscription rights, option rights or rights of conversion or similar rights with regard to the Sold Shares. There are no agreements under which RÖNTEC AG is required to issue or transfer shares, warrant-linked bonds or convertible bonds. This does not apply to the convertible bond existing between the Company and Prof. Norbert Langhoff which gives Prof. Norbert Langhoff an option to acquire 50,000 shares in RÖNTEC AG. The Sold Shares are not the subject of trustee relationships or sub-participations.
5.3	Company Law Situation
5.3.1	The statements in the Preamble, Clause 1.1 and Clause 1.2 of this Purchase and Transfer Agreement are correct. RÖNTEC AG has been properly established and continues to validly exist. Exhibit 5.3.1 contains the current articles of RÖNTEC AG and the current excerpt from the Commercial Register for RÖNTEC AG. The excerpt from the Commercial Register

	contains all facts which are required to be registered as well as all resolutions of the shareholders’ meeting which must be registered prior to the closing of this Purchase and Transfer Agreement. In addition, there are no other agreements or collateral agreements about the circumstances or the organization of the Company.
5.3.2	Except for the silent partnerships with bmp AG and bmp Venture Tech GmbH under the partnership agreement of 28 December 1998 and with Ventegis Capital AG under the partnership agreement of 29 October/5 November 2004, there are no silent participations in the Company. The agreements on creating silent partnerships with bmp AG, bmp Venture Tech and Ventegis Capital AG are attached as Exhibit 5.3.2. Aside from these agreements, there are no other participations including silent participations and sub-participations in the Company, and there are no conditional obligations (options) owed to shareholders or third parties or binding offers relating to the creation of such participations or the granting of rights equivalent or similar to those of a shareholder (e.g. voting agreements, profit participation agreements).
5.4	Participations
	The Company holds the following participations listed under points a) through c) and has a 100% participation in the respective capital and voting rights of the following named companies.
	a)	RÖNTEC UK Ltd.
	b)	RÖNTEC France s.a.r.l.
	c)	RÖNTEC USA Inc.
	RÖNTEC AG holds no other participations. It has not undertaken to shareholders or third parties to acquire or sell participations.
	The companies listed above under points a) and b) have discontinued their business operations. According to the knowledge of the Sellers, these companies have no contracts with third parties or liabilities owed to third parties. This does not include liabilities resulting from discontinuing business operations or preparing the annual financial statements. The Company also has no liabilities to the companies listed under points a) and b) except for liabilities shown in the Annual Financial Statements, and the Company is not liable towards third parties for liabilities of these companies.
	According to the knowledge of the Sellers, the Company has no liabilities outside the ordinary course of business to the subsidiary listed under point c) except to the extent shown in the Annual Financial Statements of the

	Company. According to the knowledge of the Sellers, the Company is not liable towards third parties for liabilities of the subsidiary listed under point c). Aside from this, the independent promises given in Clauses 5.2 through 5.35 for the subsidiary mentioned under point c) apply accordingly, whereby a breach of guarantee only exists if the Sellers have knowledge of the relevant matter.
5.5	Inter-company Agreements
	RÖNTEC AG has not concluded any control, profit and loss transfer or other inter-company agreements with other companies. This does not apply to the contracts on the partial surrender of profits which are related to the silent partnerships between RÖNTEC AG and bmp AG, bmp Venture Tech GmbH and Ventegis Capital AG.
5.6	No Insolvency Proceedings
	No insolvency proceedings have been applied for or commenced against RÖNTEC AG. According to the knowledge of the Sellers, upon conclusion of this Purchase and Transfer Agreement, there are neither circumstances which would require an application for insolvency proceedings to be filed against RÖNTEC AG, nor circumstances which would justify the annulment [Anfechtung] of this Purchase and Transfer Agreement under applicable insolvency law.
5.7	Annual Financial Statements
5.7.1	The following applies with regard to the annual financial statements of RÖNTEC AG for the fiscal years ending on 30 June 2004 and 30 June 2005 (hereinafter referred to as the “Annual Financial Statements”) to be provided by the Sellers to the Purchaser after conclusion of this Agreement. The Annual Financial Statements have been audited and affixed with an unqualified auditor’s opinion. According to the knowledge of the Sellers, the Annual Financial Statements were prepared in accordance with generally accepted accounting principals as well as in compliance with the principles of balance sheet and valuation continuity (same valuation methods applied); the Annual Financial Statements reflect from the perspective of the respective balance sheet dates a true and accurate picture of the assets, financial situation and earnings of RÖNTEC AG within the meaning of § 264 para. 2 German Commercial Code [Handelsgesetzbuch, “HGB”]. According to the knowledge of the Sellers, there are no liabilities or contingent liabilities, nor have any such liabilities been created, which exceed the liabilities and contingent liabilities within the meaning of § 251 HGB that are reported or for which provisions have been set aside in the Annual Financial Statements; these

	liabilities and contingent liabilities are completely and correctly identified in the notes to the Annual Financial Statements.
5.8	Contingent Liabilities
	Exhibit 5.8 contains a true and complete list of all contingent liabilities of the Company as of the time when this Agreement is concluded, including any contingent liabilities under bills of exchange.
5.9	Futures Transactions / Options
	The Company has not concluded any futures or options transactions for commodities, foreign currency, securities or financial products (e.g., indices, interest rates, financial units, etc.)
	There are also no contingent obligations of the Company under options or similar agreements on the acquisition or the sale of (i) participations or memberships in other companies and (ii) real property or rights equivalent to real property.
5.10	Loan Agreements / Liabilities owed to Banks
	Exhibit 5.10 contains a true and complete list as of the time when this Agreement is concluded of all loan agreements concluded by the Company as the debtor, including all loan agreements with the Sellers and/or third parties, as well as the current status as of 30 September 2005 of all liabilities owed to banks. The existing current account credit lines total EUR ***.
5.11	Security / Liability for Obligations of Third Parties
	According to the knowledge of the Sellers, the Company has not provided security for liabilities owed to third parties and has not issued any sureties [Bürgschaften], guarantees or letters of comfort [Patronatserklärungen], except for the reservations of title for the benefit of suppliers which are standard in the industry.
5.12	Assets
	The Company is the sole and unrestricted owner and/or holder of all assets allocated to fixed and current assets in the ordinary course of business and included in the Company’s Annual Financial Statements 2005. These assets are free of encumbrances of all kinds in favor of third parties, except for
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

	standard reservations of title and security interests in respect of the liabilities incurred in the ordinary course of business and included in the Annual Financial Statements 2005. This does not apply, however, to all receivables owed by customers, which have been assigned as security to Deutsche Bank AG.
	The assets of the Company and the other items which the Company uses in the ordinary course of business on the basis of rent, lease or other agreements on use are in proper condition as of 30 September 2005 having regard to normal wear and tear and are sufficient in order to conduct the operations of the Company to their current extent. The above assets and items are free of defects except for such defects for which provisions have been established in the Annual Financial Statements 2005.
5.13	Intellectual Property Rights
	a)	Exhibit 5.13 is a full and complete list of all patents, trademarks and other intellectual property rights which the Company holds and all agreements with third parties (including the Sellers) about such patents, trademarks or other intellectual property rights. In addition, license agreements (active and passive) relating to such intellectual property rights or know-how are included in Exhibit 5.13. The intellectual property rights listed in Exhibit 5.13 are validly existing and, to the knowledge of the Sellers, have not been challenged by third parties and, to the knowledge of the Sellers, are not subject to cancellation. Any registration fees or other costs for the maintenance of these intellectual property rights have been fully paid.
	b)	According to the knowledge of the Sellers, the Company possesses all patents, trademarks and other intellectual property rights which are necessary for its business operations. According to the knowledge of the Sellers, the Company does not use any patents, trademarks or other intellectual property rights of third parties to which it does not have a right of use under a license agreement, and to the knowledge of the Sellers, the Company is not violating patents, trademarks or other intellectual property rights of third parties by the conduct of its business as it is currently conducted.
	c)	The Sellers themselves hold no copyrights, patents, trademarks or other intellectual property rights either directly or indirectly (e.g., by family members or companies in which they hold participations by themselves or together with family members) which the Company requires or uses for the conduct of its business as it is currently conducted.

5.14	Company Name
	The Company is entitled to carry its name. The use of the name does not violate any rights of third parties.
5.15	Lease and Similar Agreements
	Exhibit 5.15 reflects all rent, lease, leasing and other long-term contractual relationships concluded by the Company which individually give rise to annual payment obligations of more than EUR 5,000.00.
5.16	Procurement
	Exhibit 5.16 contains all material agreements on the purchase of goods lasting beyond 31 December 2005 and all orders issued to third parties relating to the acquisition by the Company of assets with a value of more than EUR 5,000.00 in the individual case. There are no obligations of the Company, including under the contracts listed in Exhibit 5.16, involving the acquisition of minimum amounts of raw materials and supplies or other products or for payment of prices higher than market price.
5.17	Service Agreements
	Exhibit 5.17 contains a complete and accurate list of all service agreements under which the Company is required to provide support and maintenance services to its customers. Exhibit 5.17 also mentions all open technical and maintenance problems which the Company currently has when rendering its services under the service agreements.
5.18	Consulting Agreements
	The Company has not concluded any consulting agreements for services which the Company receives or under which the Company is required to provide consulting services.
5.19	Distribution Agreements
	Exhibit 5.19 contains a complete and accurate list of all distribution agreements and commercial agency agreements (active and passive) of the Company. According to the knowledge of the Sellers, these agreements have not been terminated, nor is termination threatened to the best of the Sellers’ knowledge. The Company has not concluded any commercial agency, distributorship or similar agreements which could lead to future claims pursuant or according to § 89 b HGB, except to the extent they have been

	identified as such in Exhibit 5.19. Claims pursuant or according to § 89 b HGB have not yet been asserted and none have been foreshadowed.
5.20	Personnel
	a)	The personnel data of RÖNTEC AG provided to the Purchaser on 7 October 2005 in the context of the due diligence examination contains a true and complete list of all employees of the Company. The data contained there are correct.
	b)	No special benefits of any kind whatsoever (e.g. premiums, bonuses, commissions, special vacations) have been promised to employees and members of the management board [Vorstand] for the future.
	c)	The employment agreements between the Company and the employees employed at the Company as of the Effective Transfer Date on 7 October 2005 and the agreement with Mr. Thomas Schülein, a member of the management board, have not been terminated, except for the agreement with the employee Mr. Norbert Böttcher. To the best of the Seller’s knowledge, none of the employees or Mr. Thomas Schülein has announced a desire to terminate the employment relationship as a result of the pending change in the shareholders or for other reasons.
	d)	The Company is not a member of an employers’ association and is not subject to any binding union salary rates, including under any union agreements which have been declared to be generally applicable. There is no works council [Betriebsrat] at the Company. To the best of the Sellers’s knowledge, there are also no efforts to establish any works councils.
5.21	Continuation of Material Agreements
	The cooperation agreement existing between the Company and *** is not subject to termination, limitation or amendment as a result of the change in the shareholders and is legally valid; the rights and claims of the Company established in this contract are enforceable. The contract is not terminated. There are no indications that during the period after conclusion of this Agreement there could be a termination, notice of termination or failure to extend this contract. There have especially been no circumstances which have
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

	arisen in the business relationships of the parties to the above contract which would indicate a disturbance or even a breaking off of the business relationship in the near future.
5.22	Customer Relations
	According to the knowledge of the Sellers, there have been especially no circumstances in the business relationships with their customers (such as resolved or unresolved warranty claims, problems with deliveries or other contractual problems) which would result in a disturbance or even a breaking off of the business relationship in the near future.
5.23	Insurance
	Exhibit 5.23 contains a true and complete list of all insurance agreements concluded by the Company stating the insured risk and the respective insurance amount. The Company has fulfilled its obligations under the corresponding insurance contracts and has not defaulted on the obligation to pay insurance premiums.
5.24	Disputes
	As of 7 October 2005 there are no court proceedings, administrative proceedings or arbitration proceedings or other legal proceedings (active or passive) for or against the Company or which are threatened where the amount in dispute exceeds EUR ***. In addition, to the best of the Sellers’ knowledge, no such disputes or administrative proceedings are to be expected in which the Company would be involved as a party.
5.25	Warranties
	The Company has granted warranties only in the ordinary course of business to its customers or end-users of the products it delivers. According to the knowledge of the Sellers, these warranties do not exceed what is common in the field. Exhibit 5.25 contains a complete and accurate list of all products delivered by the Company in the past for which the Company’s contract partner or the end-user still has oral or written warranties or warranties in the form of a “Gentlemen’s Agreement”. Exhibit 5.25 also contains a complete
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

	and correct list of all products produced by the Company in relation to which the respective customer of the Company or the end-user has reported technical problems in the past, which has given rise or could give rise to claims against the Company.
5.26	Products
	To the knowledge of the Sellers, the products produced and distributed by the Company satisfy all applicable legal provisions and can be produced and distributed without violating patents, trademarks or other intellectual property rights of third parties.
5.27	Compliance
	To the extent not stated otherwise in Exhibit 5.27, the following applies to the Company: The business operations of the Company as well as the buildings they use are substantially in compliance at the present time with the permits and approvals under public law and all applicable laws and regulations, including construction law and zoning law and provisions covering protection of health, maintenance of safety at the work place and protection of the environment. The Company has all permits and licenses under public law and civil law which are required or appropriate for the conduct and operations of the Company and for its transactions. The existence of such permits or concessions is not endangered. The business operations of the Company do not violate any administrative orders, conditions or other orders issued by government or municipal authorities or courts.
5.28	Environment
	The Sellers are not aware of any soil and/or groundwater contamination or other harmful changes of the soil within the meaning of § 2 para. 3 German Soil Protection Act [Bundesbodenschutzgesetz, “BBodSchG”] requiring clean-up as a result of the operational activities of the Company; furthermore, the Sellers are not aware of any classification of the Company’s commercial property as an area of preexisting contamination [Altlasten] within the meaning of § 2 para. 5 BBodSchG for which the relevant authorities, according to the current state of knowledge, could require that the owner or holder of immediate possession conduct an investigation, clean-up, removal, other treatment or control, or assume the costs of such measures. According to the knowledge of the Sellers, there are no pending proceedings of public authorities against the Company relating to the removal of contamination of

	the soil and/or the groundwater or an inspection of such contamination, nor have such proceedings been announced or are they to be expected.
5.29	Public Subsidies
	To the extent that the Company received public subsidies in the past, these subsidies were granted on the basis of accurate and correct information by the Company, and they were used in accordance with the determinations, conditions and terms in the orders granting subsidies or the agreements on subsidies. Corresponding subsidies have not been granted in violation of the substantive and formal provisions under Art. 87 and 88 EU Treaty. The corresponding orders granting subsidies are, to the knowledge of the Sellers, legally valid, have not been challenged, and there are no indications that the Company is or could be required to repay subsidies which have been approved or granted for periods prior to the Closing Date for any reason (including the change of shareholders effected by this Agreement).
5.30	Restrictions on Competition
	Except as stated in Exhibit 5.30, there are no prohibitions and agreements for the benefit of the Company or burdening the Company, especially no agreements which could restrict the Company from being or becoming active in its present field of business or in other fields of business in the future. In addition, and except as listed in Exhibit 5.30, there are no agreements on delineation of markets or other arrangements relating to competition law between the Company and third parties, especially not with the Sellers or enterprises in which the Sellers have a direct or indirect participation.
5.31	Business Dealings with the Sellers
	Except for the contracts listed in Exhibit 5.31, the Company has no contracts with the Sellers or parties related to the Sellers or businesses in which the Sellers hold participations. Parties related to the Sellers or enterprises in which the Sellers have a participation have not received loans from the Company which have not yet been fully repaid and for which the borrower has not paid market rate interest to the Company in full.
5.32	Complete Disclosure
	During the discussions and negotiations in the lead-up to this Agreement about the acquisition of the shares in the Company and in response to the questions posed, the Sellers have provided to the Purchaser and its representatives truthful and complete information which a purchaser acting with reasonable care in commercial matters could in good faith expect from a seller acting as

	an honest businessman as the basis for the decision to conclude this Agreement. According to the knowledge of the Sellers, there are no circumstances indicating that the guarantees given in this Agreement are not or will not be accurate on the date of conclusion and closing of this Agreement, or which indicate that the unrestricted continuation of the business operations of the Company after the date of conclusion and closing of this Agreement could be materially adversely affected.
5.33	Brokers
	Neither the Seller nor the Company have retained a broker or mediator in connection with the conclusion of this Agreement, and no obligations to pay fees for a broker or a mediator in connection with the conclusion of this Agreement have been undertaken for which the Purchaser or the Company is or could be liable.
5.34	Assets of the Sellers
	The Shares sold pursuant to Clause 2.1 do not constitute the complete assets of the respective Sellers within the meaning of § 1365 BGB.

	§ 6
	CONSEQUENCES OF BREACH
6.1	Compensatable Damage
6.1.1	In the case of a violation of the guarantees under Clause 5 and Clause 7 of this Purchase and Transfer Agreement by the Sellers, the Sellers must place the Purchaser and RÖNTEC AG in the position they would have been in if the guarantee had not been violated [Naturalrestitution]. If the Sellers are not willing or able to do this within 60 days after the Purchaser has notified the Sellers in writing about the violation of a guarantee, the Purchaser can demand monetary damages.
6.1.2	The Purchaser has no claims against the Sellers for a breach of a guarantee under Clause 5 and Clause 7 of this Purchase and Transfer Agreement if and to the extent that
	(a)	the circumstance for which the claim is asserted is sufficiently taken into account in the Annual Financial Statements; or
	(b)	provisions in the Annual Financial Statements can be written back for this purpose; or

	(c)	the set of facts constituting a breach of a guarantee under Clause 5 and Clause 7 of this Purchase and Transfer Agreement has been completely disclosed to the Purchaser in the Disclosure Letter attached as Exhibit 6.1.2.a; or
	(d)	the set of facts constituting the breach of a guarantee under Clause 5 and Clause 7 of this Purchase and Transfer Agreement has been addressed in the Due Diligence Report of the Law Firm CMS Hasche Sigle attached as Exhibit 6.1.2.b or in the letter of Mr. William Knight of 20 September 2005 attached as Exhibit 6.1.2.c; or
	(e)	the violation of the warranty results exclusively from the fact that the status of the law has changed between the conclusion of this Agreement and the Closing Date.
6.2	Liability of the Sellers for the Guarantees under Clause 5
	The liability of the Sellers for a violation of the guarantees in Clauses 5.4 through 5.26 and Clause 5.29 through Clause 5.35 of this Purchase and Transfer Agreement is limited to the amount of the net Purchase Price plus the amount of any increase in the Purchase Price pursuant to § 4 of this Purchase and Transfer Agreement allocable to the respective Seller (hereinafter referred to as the “Maximum Liability Amount”).
6.3	Exempt Amount, Total Exempt Amount
	The Purchaser is only entitled to assert claims under Clauses 5.4 through 5.35 of this Purchase and Transfer Agreement if in a specific case the claim against one or more Sellers has a total value of EUR * (ten thousand Euros) (hereinafter referred to as the “Minimum Amount”) and the total amount of one or more individual claims against the Sellers under Clauses 5.4 through 5.35, taking into account the following sentence, exceeds a total of EUR * (twenty-five thousand Euros) (hereinafter referred to as the “Threshold Amount”). If the Minimum Amount and the Threshold Amount are exceeded, the Sellers are liable for the total amount. In the case of claims under Clauses 5.1 through 5.3 of this Purchase and Transfer Agreement, claims can be asserted against one or more Sellers without the Minimum Amount or a Threshold Amount having to be reached.
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

6.4	Knowledge of the Purchaser
	Section 442 para. 1 BGB applies subject to the proviso that the sets of facts contained in the Due Diligence Report of the Law Firm CMS Hasche Sigle attached as Exhibit 6.1.2.b and the letter of Mr. William Knight of 20 September 2005 attached as Exhibit 6.1.2.c are considered to be known to the Purchaser, and only claims against the Sellers based on these sets of facts cannot be asserted; aside from this, circumstances about which the Purchaser has knowledge and which would constitute a breach of the guarantees in § 5 and § 7 do not preclude the Purchaser’s Rights.
6.5	Notice to the Sellers; Proceedings in the Case of Third Party Claims
	In the case of an actual or possible breach of a guarantee under § 5 and § 7 of this Purchase and Transfer Agreement, the Purchaser is required to notify the Sellers in writing about the actual or potential breach and to state the estimated amount of the claim to the extent possible. The Sellers must be given the opportunity to correct the breach within the period set forth in Clause 6.1.1 of this Purchase and Transfer Agreement.
6.6	Mitigation of Loss, Exclusion of Liability
	Section 254 BGB remains unaffected. In particular, the Purchaser is required to avoid the occurrence of harm and to minimize the amount of the resulting damages. A claim for damages by the Purchaser is limited to the direct damages caused by the incorrectness of the guarantee, excluding indirect damages, consequential damages and loss of profits.
6.7	Limitations Period
	All claims of the Purchaser for breach of a Sellers’ guarantee under Clause 5.4 through Clause 5.27 and Clause 5.30 through Clause 5.35 of this Purchase and Transfer Agreement are time-barred on 31 March 200***; claims due to a breach of a guarantee under Clauses 5.1 through 5.3 of this Purchase and Transfer Agreement are time-barred after the expiration of 10 (ten) years from the Closing Date, claims for a breach of Clause 5.28 are time-barred after the expiration of 5 (five) years from the Closing Date, and claims for violation of Clause 5.29 are time-barred upon expiration of 3 (three) years from the Closing Date. Claims of the Purchaser under § 7 (Taxes) of this Purchase and Transfer Agreement are time-barred 6 months after a final and binding ruling has been issued by the relevant tax authority for the relevant period of time.
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

6.8	Exclusion of further Claims
	To the extent legally permissible and not expressly agreed otherwise in this Purchase and Transfer Agreement, all further claims and warranties are expressly excluded, regardless of how they arose, their scope or their legal basis. This applies especially for claims based on breach of pre-contractual duties (§ 311 para. 2 and 3 BGB), violations of duties under a contractual relationship, claims for reduction of the Purchase Price, and claims based on disruption of the fundamental premises upon which the transaction is based. The withdrawal from this Purchase and Transfer Agreement is also excluded except in the cases of Clause 3.3.1, § 10, § 15.

	§ 7 TAX WARRANTIES AND INDEMNIFICATION
7.1	Tax Guarantee
	The Sellers also guarantee as an independent guarantee pursuant to § 311 para. 1 BGB that, as of the Closing Date:
	(a)	RÖNTEC AG has provided all declarations and preliminary notifications about taxes, fees, contributions and other levies, customs duties and social insurance contributions and all other legally required declarations to the relevant authorities on time or in accordance with an express or implicit extension of deadline and in a complete and truthful manner. There are no external audits or other audits currently being conducted at RÖNTEC AG;
	(b)	RÖNTEC AG has completely paid when due all taxes including tax prepayments, fees, contributions and other levies, customs duties and social insurance contributions and has withheld all taxes (tax withholding amounts), fees, contributions and other levies, customs duties and social insurance contributions which were required to be withheld and has passed them on to the respective recipient when due and has paid all ancillary tax payments, amounts subject to tax liability and penalties;
	(c)	RÖNTEC AG has set aside tax provisions in the Annual Financial Statements at least in the amount required by law to the extent that taxes, including tax withholding amounts, ancillary tax payments and amounts subject to tax liability, fees, contributions and other levies,

		customs duties and insurance contributions as well as fines were not paid or not paid in full for assessment periods prior to 30 June 2005;
	(d)	RÖNTEC AG has accurately reported any claims for reimbursement or return of taxes, fees, contributions and other levies, customs duties and social insurance contributions in the Annual Financial Statements.
7.2	Damages based on Tax Guarantees
	The Purchaser is entitled to assert a claim for damages against the Sellers in the amount of any tax burden on RÖNTEC AG (including tax prepayments, fees, contributions and other levies, customs duties and social insurance contributions) which (i) relates to assessment periods up to 30 June 2005, or (ii) relates to periods prior to the Closing Date and which has not been fully discharged by the Closing Date or has not been sufficiently provided for in the Annual Financial Statements 2005. In the case of sentence 1 (ii), the applicable taxes, levies, customs duties and social insurance amounts will accrue on a pro rata temporis basis. Sentence 1 applies accordingly in the case of taxes resulting from hidden distributions of profits [verdeckte Gewinnausschüttungen] which took place prior to the Closing Date.
	The above claims for damages do not include changes that are merely the result of shifting the tax basis (shifting between tax periods).

	§ 8 DISCHARGE OF RÖNTEC AG’S LIABILITIES
8.1	Release from Liabilities under Loans and other Liabilities
	The Purchaser undertakes to directly obtain a release from the respective creditor of the liabilities listed in Exhibit 8 within 30 Banking Days after the Closing Date and, in so doing, to make a contribution to RÖNTEC AG’s other capital reserves as defined in § 252 para. 2 no. 4 HGB. Furthermore, the Purchaser intends to repay the other loan obligations if this is economically appropriate.

	§ 9 INDEMNIFICATIONS AND COVENANTS OF THE SELLERS
9.1	Limitations Period; Scope of Liability
	Claims for indemnification under this Clause 9 are time-barred upon expiration of 8 (eight) years after the Closing Date. Clause 6.6 applies mutatis mutandis.
9.2	Proceedings in the Case of Indemnification Claims
	To the extent that the Sellers consider claims of third parties for which the Purchaser and/or RÖNTEC AG can claim indemnification under Clauses 9.1 through 9.3 (hereinafter the “Indemnification Claims”) to be unjustified, the following applies: The Purchaser and/or RÖNTEC AG will inform the respective Sellers required to indemnify about the Indemnification Claims completely and without undue delay and will only make declarations in litigation and other declarations (also to public authorities) with the consent of the Sellers required to indemnify. At the request of the respective Sellers required to indemnify, the Purchaser and/or RÖNTEC AG will take measures to defend against the Indemnification Claims either themselves or through a person designated by the respective Sellers required to indemnify, provided that the respective Sellers required to indemnify pay all related costs (court costs as well as costs outside of court), including advances and security, before they become due. The disputes about Indemnification Claims will be conducted according to the instructions of the respective Sellers required to indemnify to the extent that the respective Sellers under the obligation to indemnify require this without undue delay after the notice from the Purchaser and/or RÖNTEC AG about the Indemnification Claims. The costs of defending against obviously unjustified claims will initially be borne by the Company.
9.3	Indemnification in connection with Silent Participations
	In the event that doubts exist that the silent participations between RÖNTEC AG and bmp AG, bmp Venture Tech GmbH and Ventegis Capital AG will be validly terminated with economic effect as of the Closing Date pursuant to the termination agreement still to be concluded, bmp AG, bmp Venture Tech GmbH and Ventegis Capital AG undertake to place the Purchaser and RÖNTEC AG completely in the position they would have been in if the above mentioned silent participations had been validly terminated effective as of the Closing Date.

	§ 10 MATERIAL ADVERSE CHANGE
	If during the period between conclusion of this Agreement and the Closing Date an event occurs or circumstances become known which lead to the following, the Purchaser is entitled to withdraw from this Agreement by declaration given to the Sellers:

	a)	if the unrestricted continuation of the business operations of the Company during the period after the date of conclusion or the closing of this Agreement could be materially adversely affected,

	or

	b)	if there is a violation of one of the independent guarantees given under § 5 and § 7 which may lead to actual or anticipated harm to RÖNTEC AG and/or the Purchaser in excess of an amount of EUR 300,000.00, without it being necessary that a claim of the Purchaser against the Sellers for such damage actually exists under § 6 or § 8.

	or

	c)	if an application is submitted to commence insolvency proceedings over the assets of the Company and/or reasons for commencing insolvency proceedings under §§ 16 through 19 German Insolvency Code [Insolvenzordnung] exists.

	If the Purchaser withdraws from this Agreement under this § 10, claims of the Sellers against the Purchaser based on or relating to the withdrawal from this Agreement are excluded. Any further claims of the Purchaser remain unaffected, even if it withdraws from this Agreement. After expiration of the Closing Date, the Purchaser is precluded from withdrawal pursuant to this § 10.

	§ 11 VESTING
All Old Shareholders, except for the Old Shareholders Martin Gander, Rainer Schädlich, Gerd Liebezeit and Prof. Dr. Norbert Langhoff, undertake to conclude the

Stock Repurchase Agreement with Bruker BioSciences Corporation attached as Exhibit 11 immediately after conclusion of this Agreement and to comply with the restrictions on dispositions of the Registered Shares set forth in the Stock Repurchase Agreement.

	§ 12 PROHIBITION ON COMPETITION
12.1	Prohibition on Competition for the Sellers
	The Old Shareholders, except for *, undertake to the Purchaser and RÖNTEC AG by way of a third party beneficiary contract that they will not engage in activities which are in competition with the business of RÖNTEC AG as conducted on the date this Agreement is concluded or promote such competition, be it directly or indirectly or for own account or for the account of a third party, for a period of three years after the date on which this Agreement is concluded. This prohibition on competition covers the territory of *.
12.2	Participations in a competitive Enterprise
	The Old Shareholders undertake towards the Purchaser and RÖNTEC AG by way of a third party beneficiary contract also not to participate in one or more enterprises which are in competition in any way whatsoever with RÖNTEC AG in the territory mentioned in Clause 12.1, be it directly or indirectly or for their own account or the account of third parties, for a period of three years after conclusion of this Agreement. This prohibition on participations applies to all participations as owner, shareholder or in any other form (also silent), but not for the acquisition of shares listed on an exchange up to 2% of the share capital in a stock corporation if the acquisition is for purposes of investment without exercising or seeking to exercise influence on the management of the relevant company.
12.3	Activity for RÖNTEC AG
	The prohibition on competition is not violated by work for RÖNTEC AG or its successors in right.

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

12.4	*Contract Penalty [Strafversprechen]*
	Each Seller who violates the provisions in this § 12 or in § 13 undertakes to pay to the Purchaser a contract penalty in the amount of EUR *** for each instance of a violation of the prohibition on competition under the above Clauses 12.1 through 12.3 or the provisions on confidentiality in § 13, which penalty is due upon the commencement of the violation and will bear interest from that point in time at the rate of 5% annually above the respective base interest rate [Basiszinssatz]. If the violation is continued despite a written reminder, then a further contractual penalty in the amount set forth in sentence 1 is to be paid for each commenced month of the violation; the above provision applies mutatis mutandis to when the penalty becomes due and to the interest thereon. The claim of the Purchaser for payment of the contractual penalty does not affect the claims of the Purchaser, RÖNTEC AG or any successors in right to RÖNTEC AG for damages or performance (cease and desist in competing, compelling compliance with the obligation of confidentiality). The Sellers are required to provide information to the Purchaser and RÖNTEC AG about the duration, type and scope of the violation against the prohibition on competition and/or the requirement of confidentiality.

	§ 13 CONFIDENTIALITY AND PRESS RELEASES
13.1	Confidentiality; Press Releases; Public Announcements
	The Sellers undertake to maintain confidentiality towards third parties with regard to the conclusion, the parties and the content of this Purchase and Transfer Agreement, unless the relevant facts are public knowledge or their publication is required by law, by other regulatory, accounting or tax rules, or by virtue of other administrative requirements. In this case, the Sellers are required to inform the Purchaser in advance and to limit the publication to the content required by law or by the public authorities. The Purchaser is free - without the consent of the Sellers - to issue press releases or other publications about the transactions contemplated in this Purchase and Transfer Agreement. Any notices or announcements, which are required by law or by the applicable stock exchange rules or securities laws and regulations, must be made.
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

13.2	Confidentiality on the part of the Sellers
	The Sellers are required to treat all business secrets of the Company as confidential and not to disclose them to third parties or use them for the Sellers’ own purposes, unless these business secrets have become public knowledge prior to the date on which this Purchase and Transfer Agreement is concluded without this obligation being violated, or the Sellers are compelled by law to make such disclosures or the Purchaser has given prior written consent to the disclosure.

	§ 14 ASSIGNMENT OF RIGHTS AND OBLIGATIONS
	The rights and obligations under this Purchase and Transfer Agreement cannot be assigned, either in whole or in part, without the prior written consent of the respective other Parties. This does not apply to the transfer of rights and/or obligations of the Purchaser to an enterprise, which is affiliated with the Purchaser or its shareholder [verbundenes Unternehmen] within the meaning of §§ 15 et seq. German Stock Corporations Act [Aktiengesetz, “AktG”].

	§ 15 CONTINUATION OF THE BUSINESS OPERATIONS
15.1	The Parties will inform each other without undue delay in the event that the following actions are supposed to be carried out prior to the Closing Date:
	(a)	withdrawals or (advance) distributions of profits or reserves;
	(b)	conclusion, termination, notice of termination or amendments to contracts, which are outside of the ordinary course of business or have a value of more than EUR 25,000.00 or a fixed term of more than one year;
	(c)	changes to the accounting methods;
	(d)	issuance of guarantees, sureties [Bürgschaften], comfort letters or other forms of security for the liabilities of third parties (including the Sellers);
	(e)	authorization of capital expenditures in excess of EUR 25,000.00;

	(f)	hiring of employees, including trainees and independent contractors, or granting pensions;
	(g)	conclusion, termination, notices of termination of or modification to contracts with the Sellers or enterprises affiliated with the Sellers within the meaning of §§ 15 et seq. AktG as well as the settlement of claims of the Sellers and/or their affiliated enterprise against RÖNTEC AG or the making of other payments to the above persons, except for those customary business payments, which have been made in the ordinary course of business upon exercising the care of a reasonable business person and which were similar to those payments made in business year 2004/2005; or
	(h)	conclusion, termination, notice of termination of or modification to contracts or agreements for industrial property rights, copyrights or other intellectual property rights, including rights of use as well as the issuance of such declarations and the taking other measures in connection with the above rights;
	(i)	other actions outside of the ordinary course of business.
15.2	If the Company carries out one of the above measures in the period between conclusion of this Agreement and the Closing Date without the prior consent of the Purchaser, then the Purchaser will be entitled to withdraw from this Agreement by giving written notice to the Sellers within a period of 30 calendar days after the point in time when the Purchaser obtained knowledge of the measure. Mutual claims of the Parties against each other do not exist in the case of a withdrawal under this Clause 15.2.

	§ 16 POWER OF ATTORNEY FROM THE SELLERS
Each of the Sellers hereby grants power of attorney to:
	Mr. Stephan Tarlach, with offices at Alt-Moabit 59-61, 10555 Berlin
	as well as
	Mr. Thomas Schülein, ***,
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

	as well as
	Mr. Jürgen Faigle, with offices at Kürfürstendamm 119, 10711 Berlin,

acting jointly, to issue all necessary and/or appropriate declarations of intent for the Sellers in connection with the sale and transfer of all shares held by the Sellers in RÖNTEC AG to the Purchaser and to receive such declarations; this power of attorney is irrevocable, but it is limited until 31 December 2005, and the attorneys-in-fact are released from the restrictions of § 181 BGB. This also applies to the exercise of all shareholder rights in shareholders’ meetings of the Company.

	§ 17 TAXES AND COSTS
17.1	Taxes
	Any transaction taxes, including real property transfer tax, and all other fees and levies resulting from the conclusion or the performance of this Purchase and Transfer Agreement will be borne by the Purchaser. This also applies to all fees and other costs in connection with proceedings under cartel law, stock exchange proceedings and the compliance with other provisions under public law.
17.2	Costs
	Otherwise, each Party bears its own costs and disbursements, including the fees, costs and disbursements of its Consultants.

	§ 18 NOTICES
18.1	Form of Notices
	All legal declarations and other notices in connection with this Purchase and Transfer Agreement must be in written form to the extent that notarization or another form is not required by law.

18.2	Notices to the Sellers
	All notices to the Sellers in connection with this Purchase and Transfer Agreement are to be addressed to:
	a)	In the case of a notice to bmp AG and/or bmp Venture Tech GmbH:
		bmp Aktiengesellschaft z. Hd. Stephan Tarlach Alt-Moabit 59-61 D-10555 Berlin
	b)	In the case of a notice to Ventegis Capital AG:
		Ventegis Capital AG z. Hd. Herrn Jürgen Faigle Kurfürstendamm 119 D-10711 Berlin
	c)	In the case of a notice to one or all Old Shareholders:
		Thomas Schülein *** All Old Shareholders hereby grant irrevocable power of attorney, which will survive their own death, to Mr. Thomas Schülein for the purpose of receiving all declarations as their agent for receipt of legal declarations which are directed under this Agreement to one or more Old Shareholders.
18.3	Notices to the Purchaser
	All notices to the Purchaser in connection with this Purchase and Transfer Agreement are to be addressed to:
	Bruker AXS GmbH z. H. Herrn Dr. Frank Burgäzy Östliche Rheinbrückenstraße 50 76167 Karlsruhe
[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

18.4	Changes in the Addresses
	The Parties must notify the respective other parties in writing about changes in the above addresses. The current address is deemed to be valid until such a notice.

	§ 19 FINAL PROVISIONS
19.1	Applicable Law
	This Purchase and Transfer Agreement is governed by German law to the extent that the laws of another country are not required to be applied. Any references under the applicable conflicts of law rules [Internationales Privatrecht] and the United Nations Sales Convention do not apply.
19.2	Jurisdiction and Venue
	To the extent legally permissible, the exclusive jurisdiction and venue for all disputes between the Parties under or in connection with this Purchase and Transfer Agreement shall be Berlin. The Purchaser hereby appoints the Law Firm of CMS Hasche Sigle, Barkhausstrasse 12-16, 60325 Frankfurt am Main, as its agent for service of process, and the Sellers jointly appoint Mr. Thomas Schülein as their agent for service of process.
19.3	Amendments, Supplements and Cancellations
	Amendments, supplements or the cancellation of this Purchase and Transfer Agreement, including the amendment of this provision itself, must be writing, unless the law mandates a stricter form requirement.
19.4	Headings
	The headings of the clauses and sections in this Agreement are intended only to ease reading. They are not to be taken into account for purposes of interpreting this Purchase and Transfer Agreement.
19.5	Exhibits
	All Exhibits are incorporated by reference into this Purchase and Transfer Agreement. However, the Parties are aware that the Exhibits to this Agreement present only an incomplete status and must be supplemented and that they are only preliminary in nature and, therefore, amendments to these Exhibits will occur up the Closing Date. The final Exhibits, which are

	supposed to be binding for the Parties and incorporated by reference into this Agreement, will be exchanged between the Parties on the Closing Date and will be appended to this Agreement. Reference is made to Clause 3.3.1.
19.6	Complete Agreement
	This Purchase and Transfer Agreement contains all agreements of the Parties with respect to its subject matter as of the date of conclusion of this Agreement and supercedes any and all oral and written negotiations, agreements and arrangements concluded between the Parties previously in connection with the subject matter of this Agreement. Side agreements to this Purchase and Transfer Agreement do not exist.
19.7	Severability Clause
	If any provision in this Agreement is or becomes completely or partially void, invalid or unenforceable, then the validity and enforceability of all other provisions will not be affected thereby. The void, invalid or unenforceable provision is deemed to have been replaced by a valid and enforceable provision which most closely reflects the economic purpose intended with the void, invalid or unenforceable provision. This applies accordingly for any aspects which this Agreement did not address.
	******************

Purchaser:

		October 7, 2005		/s/ Frank Burgaezy
				(Bruker AXS GmbH,
				represented by:
				Frank Burgaezy)


		October 7, 2005		/s/ Bernard Kolodziej
				(Bruker AXS GmbH,
				represented by:
				Bernard Kolodziej)

Sellers:


			October 7, 2005			/s/ Mr. Stephan Tarlach
						/s/ Mr. Oliver Bormann
						(1. bmp Aktiengesellschaft)


			October 7, 2005			/s/ Mr. Stephan Tarlach
						/s/ Mr. Oliver Bormann
						(2. bmp Venture Tech GmbH)


			October 7, 2005			/s/ Dr. Stephan Beyer
						/s/ Mr. Karsten Haesen
						(3. Ventegis Capital AG)

			October 7, 2005			/s/ Martin Gander
						(4. Martin Gander)

			October 7, 2005			/s/ Andreas Gatzke
						(5. Andreas Gatzke)

			October 7, 2005			/s/ Gert Kommichau
						(6. Gert Kommichau)

			October 7, 2005			/s/ Klaus Kromer
						(7. Klaus Kromer)


			October 7, 2005			/s/ Gerd Liebezeit
						(8. Gerd Liebezeit)

			October 7, 2005			/s/ Manfred Maneck
						(9. Manfred Maneck)

			October 7, 2005			/s/ Olaf Meibaum
						(10. Olaf Meibaum)

			October 7, 2005			/s/ Detlef Meinhardt
						(11. Detlef Meinhardt)

			October 7, 2005			/s/ Rainer Schädlich
						(12. Rainer Schädlich)

			October 7, 2005			/s/ Thomas Schülein
						(13. Thomas Schülein)

			October 7, 2005			/s/ Prof. Norbert Langhoff
						(14. Prof. Norbert Langhoff)

			October 7, 2005			/s/ Ulrich Waldschläger
						(15. Ulrich Waldschläger)

EX-2.3 3 a05-18563_1ex2d3.htm PLAN OF ACQUISITION, REORGANIZATION, ARRANGEMENT, LIQUIDATION OR SUCCESSION

Exhibit 2.3

ASSET PURCHASE AGREEMENT

THIS AGREEMENT made and entered into as of October 21, 2005, by and among Bruker AXS Inc., a Delaware corporation (“Buyer”), Princeton Gamma-Tech Instruments, Inc., a New Jersey corporation (“Seller”) and Princeton Gamma-Tech (UK), Ltd., a United Kingdom corporation (“PGT-UK”), as well as Finn-Partners, Inc. and Third Letter Corporation (collectively “Principal Stockholders”).

RECITALS

A. Buyer desires to purchase from Seller, and Seller desires to sell to Buyer, substantially all of the assets relating to, required for, used in or otherwise constituting the Business (as defined below), in exchange for the consideration set forth below.

B. The parties desire to set forth certain additional agreements they have reached in connection with the Business.

NOW, THEREFORE, in consideration of the covenants, representations, warranties and mutual agreements set forth herein, and for other good and valuable consideration, intending to be legally bound hereby, the parties hereto hereby agree as follows:

1.0 DEFINITIONS

Capitalized Terms. The following capitalized terms shall have the meanings set forth below:

(a) “Acquired Assets” shall have the meaning set forth in Section 2.1.

(b) “Actions or Proceedings” shall have the meaning set forth in Section 2.5(b).

(c) “Agreement” means this Asset Purchase Agreement and all exhibits and attached schedules.

(d) “Allocation” shall have the meaning set forth in Section 3.3.

(e) “Assumed Liabilities” shall have the meaning set forth in Section 2.6.

(f) “Benefits Liabilities” means any and all claims, debts, liabilities, commitments and obligations, whether fixed, contingent or absolute, matured or unmatured, liquidated or unliquidated, accrued or unaccrued, known or unknown, whenever or however arising, including all costs and expenses relating thereto, and including those debts, liabilities and obligations arising under law, rule, regulation, permits, action or proceeding before any Governmental Entity, order or consent decree or any award of any arbitrator of any kind relating to any Employee Plan, Employment Agreement or otherwise to an Employee.

(g) “Books and Records” means all papers and records (in paper or electronic format) in Seller’s care, custody or control relating to the Business, including, without limitation, all purchasing and sales records, customer and vendor lists, accounting and financial records, product documentation, product specifications, marketing documents and software.

(h) “Business” means Seller’s X-ray Microanalysis business, including:

(i) all of Seller’s X-ray Microanalysis Technology and Products, including all microEDX and EBSD analysis products, the Avalon and Spirit control electronics and associated software, all Microanalysis inventories, spare parts, demo systems, etc.;

(ii) Seller’s entire Microanalysis distribution, sales and service organization, contracts, etc., including the exclusive right to sell Detectors into the X-ray Microanalysis market;

(iii) All rights to any information relating to Seller’s Microanalysis customer base;

(iv) All of Seller’s Intellectual Property Rights related to Microanalysis; and

(v) all non-financial assets of PGT-UK;

***.

(i) “Closing” shall have the meaning set forth in Section 3.1.

(j) “Closing Date” shall have the meaning set forth in Section 3.1.

(k) “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

(l) “Code” means the Internal Revenue Code of 1986, as amended.

(m) “Conflict” means any event that would constitute a conflict, breach, violation or default (with or without notice or lapse of time, or both) or give rise to a right of termination, cancellation, modification or acceleration of any obligation or loss of any benefit.

(n) “Contract” means any mortgage, indenture, lease, contract, covenant or other agreement, instrument or commitment, permit, concession, franchise or license.

(o) “Derivative Work” has the meaning ascribed to it under the United States Copyright Law, Title 17 U.S.C. Sec. 101 et. seq., as the same may be amended from time to time.

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

(p) “Detector Products” means the stand-alone detectors manufactured by Seller, and/or the associated detector control and data acquisition electronics, and/or detector control software.

(q) “DOL” shall mean the Department of Labor.

(r) “Employee” shall mean any current or former or retired employee, consultant or director of Seller.

(s) “Employee Plan” means any plan, program, policy, practice, contract, agreement or other arrangement providing for compensation, severance, termination pay, deferred compensation, performance awards, stock or stock-related awards, fringe benefits or other employee benefits or remuneration of any kind, whether written, unwritten or otherwise, funded or unfunded, including, without limitation, each “employee benefit plan,” within the meaning of Section 3(3) of ERISA, which is or has been maintained, contributed to, or required to be contributed to, by Seller or any ERISA Affiliate for the benefit of any Employee, or with respect to which Seller has or may have any liability or obligation to any Employee.

(t) “Employment Agreement” means each management, employment, severance, consulting, relocation, repatriation, expatriation, visas, work permit or other agreement, contract or understanding between Seller and any Employee.

(u) “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

(v) “ERISA Affiliate” shall mean any other person or entity under common control with Seller within the meaning of Section 414(b), (c), (m) or (o) of the Code and the regulations issued thereunder.

(w) “Exchange Act” means the United States Securities Exchange Act of 1934, as amended.

(x) “Excluded Assets” shall have the meaning set forth in Section 2.2(b).

(y) “Excluded Liabilities” shall have the meaning set forth in Section 2.7.

(z) “GAAP” means United States generally accepted accounting principles as of the date hereof.

(aa) “General Assignment” shall have the meaning set forth in Section 2.3.

(bb) “Governmental Entity” means any court, administrative agency or commission or other federal, state, county, local or foreign governmental authority, instrumentality, agency or commission.

(cc) “Indemnified Parties” shall have the meaning set forth in Section 8.2.

(dd) “Indemnifying Party” shall have the meaning set forth in Section 8.3.

(ee) “Intellectual Property Rights” means any or all of the following, including Registered Intellectual Property Rights, and all statutory and/or common law rights throughout the world in, arising out of, or associated therewith: (i) all patents and patent applications and all reissues, divisions, renewals, extensions, provisionals, continuations and continuations-in-part thereof (collectively, “Patents”); (ii) all inventions (whether patentable or not), invention disclosures and improvements, all trade secrets, proprietary information, know how and technology (collectively, “Trade Secrets”); (iii) all works of authorship, copyrights, mask works, copyright and mask work registrations and applications, including all industrial designs and any registrations and applications therefor (collectively, “Copyrights”); (iv) all trade names, logos, trademarks and service marks, trademark and service mark registrations and applications, including intent to use applications (collectively, “Trademarks”); (v) all databases and data collections (including knowledge databases, customer lists and customer databases); (vi) all rights in Software and documentation; (vii) rights to Uniform Resource Locators, Web site addresses and domain names and registrations; (viii) any similar, corresponding or equivalent rights to any of the foregoing; and (ix) all goodwill associated with any of the foregoing

(ff) “International Employee Plan” means each Employee Plan that has been adopted or maintained by Seller or any ERISA Affiliate, whether informally or formally, or with respect to which Seller or any ERISA Affiliate will or may have any liability, for the benefit of Employees who perform services outside the United States.

(gg) “IRS” shall mean the Internal Revenue Service.

(hh) “Lien” means, with respect to any asset or right, any mortgage, lien, pledge, charge, security interest, claim, equity encumbrance, restriction on transfer, conditional sale or other title retention device or arrangement (including, without limitation, a capital lease), transfer for the purpose of subjection to the payment of any indebtedness, restriction on the creation of any of the foregoing, or encumbrance of any kind whatsoever, whether relating to such asset or right or profits therefrom.

(ii) “Loss” and “Losses” shall have the meanings set forth in Section 8.2.

(jj) “Material Adverse Effect” means any change, event or effect that is materially adverse to the business, assets (including tangible assets), liabilities, condition (financial or otherwise), prospects, results of operations or capitalization of a company or entity.

(kk) “Microanalysis” means the analysis of sample elemental composition via electron beam (EDS) or X-ray excitation (microXRF) with a spot size of less than 1 mm within either an electron microscope (SEM or TEM) or within a stand-alone instrument. Seller’s Microanalysis product line currently includes the Avalon and Spirit systems, and related Microanalysis acquisition and analysis software, plus interfaces to various X-ray detectors.

(ll) “Multiemployer Plan” means any Pension Plan which is a “multiemployer plan,” as defined in Section 3(37) of ERISA.

(mm) “Object Code” means computer software, substantially or entirely in binary form, which is intended to be directly executable by a computer after suitable processing and linking but without the intervening steps of compilation or assembly.

(nn) “Pension Plan” means each Seller Employee Plan which is an “employee pension benefit plan,” within the meaning of Section 3(2) of ERISA.

(oo) “Person” means any individual, partnership, firm, corporation, association, trust, unincorporated organization or other entity, as well as any syndicate or group of any of the foregoing.

(pp) “Products” means any and all products and services of Seller related to the Business, except the Detectors.

(qq) “PTO” means the United States Patent and Trademark Office.

(rr) “Registered Intellectual Property Rights” means all United States, international and foreign: (i) Patents and Patent applications (including provisional applications); (ii) registered Trademarks and applications for Trademarks, including intent-to-use applications, or other registrations or applications related to Trademarks; (iii) registered Copyrights and applications for Copyrights; (iv) domain name registrations; and (v) any other Intellectual Property Rights that are the subject of an application, certificate, filing, registration or other document issued, filed with or recorded by any Governmental Entity.

(ss) “SEC” means the United States Securities and Exchange Commission.

(tt) “Securities Act” means the United States Securities Act of 1933, as amended.

(uu) “Software” means any and all computer software and code, including assemblers, applets, compilers, Source Code, Object Code, data (including image and sound data), design tools and user interfaces, in any form or format, however fixed. Software shall include Source Code listings and documentation.

(vv) “Source Code” means computer software and code, in form other than Object Code form, including related programmer comments and annotations, help text, data and data structures, instructions and procedural, object-oriented and other code, which may be printed out or displayed in human readable form.

(ww) “Tangible Assets” means the tangible assets (including Products and Technology) included with the Acquired Assets.

(xx) “Tax” and “Taxes” shall have the meanings set forth in Section 4.13(a).

(yy) “Technology” means all technology, technical and business information and all tangible embodiments of Intellectual Property Rights, including Software, Third Party Technology, systems, files, records, databases, drawings, artwork, designs, displays, audio-visual works, devices, hardware, apparatuses, documentation, manuals, specifications, flow charts, web pages, customer lists, electronic and other data, and other tangible embodiments of, or materials describing or disclosing, technical or business data, concepts, know-how, show-how, techniques, Trade Secrets, inventions (whether patentable or unpatentable), algorithms, formulae, processes, routines, databases, works of authorship and the like.

(zz) “Third Party Technology” means all Technology or Intellectual Property Rights of a third party or in the public domain, including, without limitation, all open source, public source or freeware Technology or any modification or Derivative Work thereof, including any version of any Software licensed pursuant to any general public license or limited general public license that was used in, incorporated into, integrated or bundled with any Technology or Intellectual Property Rights that has been, or is proposed to be, used or otherwise exploited by Seller for or in connection with the Business or that is otherwise reasonably required in order for Buyer to use and exploit the Acquired Assets as described herein following the Closing.

(aaa) “Transaction Documents” means this Agreement and the Assignments set forth in Section 2.3.

(bbb) “Transferred Contracts” means those Contracts listed on Schedule 1.1(bbb), including, without limitation, the Synergy4 sales representative contract(s) in France and other jurisdictions.

1.2 Construction. (a) For purposes of this Agreement, whenever the context requires: the singular will include the plural, and vice versa; the masculine gender will include the feminine and neuter genders; the feminine gender will include the masculine and neuter genders; and the neuter gender will include the masculine and feminine genders. As used in this Agreement, the words “include” and “including” and variations thereof will not be deemed to be terms of limitation, but rather will be deemed to be followed by the words “without limitation.”

(b) Except as otherwise indicated, all references in this Agreement to “Schedules,” “Sections” and “Exhibits” are intended to refer to Schedules, Sections and Exhibits to this Agreement.

(c) The headings in this Agreement are for convenience of reference only, will not be deemed to be a part of this Agreement, and will not be referred to in connection with the construction or interpretation of this Agreement.

(d) This Agreement shall be considered to have been jointly drafted by Buyer and Seller and ambiguities, if any, shall not be construed against any party to this Agreement.

2.0 PURCHASE AND SALE

2.1 Purchase and Sale. Subject to the terms and conditions set forth in this Agreement, except as described in Section 2.2(b), Seller hereby sells, conveys, transfers and assigns to Buyer, and Buyer hereby purchases from Seller, all of Seller’s right, title and interest in and to all of the non-financial assets, rights and properties relating to, required for, used in or otherwise constituting the Business, free and clear of any and all Liens (collectively, the “Acquired Assets”), including the following, the intent of the purchase and sale of the Acquired Assets being that Buyer shall possess the sole and exclusive right to develop, manufacture, market, sell and service the Products:

(a) the Tangible Assets;

(b) all Product and parts inventories of the Business and PGT-UK together with all commercial rights relating thereto and all technical documentation, Technology and Software therefor;

(c) an irrevocable, royalty-free, non-exclusive, perpetual license to use the name Princeton Gamma-Tech or the acronym ‘PGT’ in connection with Buyer’s conduct of the Business;

(d) all rights of Seller under the Transferred Contracts; provided, however, that as early as possible prior to the Closing, Buyer shall notify Seller which, if any, of the Contracts listed on the first page of Schedule 1.1(bbb) Buyer desires to be included within the Transferred Contracts, as Buyer shall have the right to include only those of such Contracts within the Transferred Contracts which Buyer so designates to Seller;

(e) the Books and Records;

(f) all equipment, the customer base and all marketing, sales and service documentation and customer databases relating to the Business;

(g) all Intellectual Property Rights, know-how, licenses, technical and other rights for the marketing, sales and servicing of the Products and services of the Business, as well as for products under development for the Business;

(h) any other non-financial assets, tangible or intangible, or rights of Seller related to the Business;

(i) except as otherwise set forth in Section 2.2 (b), below, all trade names used by the Business, including Avalon and Spirit; and

(j) all rights to recover past, present and future damages for the breach, infringement or misappropriation, as the case may be, of any of the foregoing.

2.2 Delivery; Excluded Assets. (a) At the Closing, Seller shall, at Seller’s sole cost, (i) deliver to Buyer title to all of the Acquired Assets, (ii) fully disclose all Technology in the Acquired Assets, (iii) in the case of the Transferred Intellectual Property Rights, Transferred Technology or other intangible assets, deliver such instruments as are necessary or desirable to document and to transfer title to such Acquired Assets from Seller to Buyer, and (iv) deliver all physical Acquired Assets to Buyer either at Seller’s New Jersey or UK facility at Seller’s cost. Seller’s Microanalysis demo equipment that presently is on loan at customer demonstration sites or customer sites, as listed in Schedule 2.2(a) attached hereto with a summary of any oral agreements therefor, will remain on loan, and Seller will transfer good and valid title to such equipment and the benefits of the loan agreements therefor to Buyer at the Closing. Without limiting the foregoing, all Software included in the Acquired Assets shall, at Buyer’s request, be delivered to Buyer by electronic means.

(b) The Business and the Acquired Assets do not include (i) , (ii) or (iii) any cash or accounts receivable (the “Excluded Assets”). However, Seller and PGT-UK shall be subject to Sections 6.6(a) through 6.6(d) with respect to their respective use and operation of certain of the Excluded Assets. .

(c) Buyer shall have a royalty-free, perpetual, irrevocable, non-exclusive license to use all of Seller’s and PGT-UK’s currently existing Intellectual Property Rights not conveyed to Buyer hereunder, but only in connection with Buyer’s conduct of the Business, including, without limitation, to support the existing installed customer base for the Products or for use in Buyer’s own Microanalysis products whether now existing or hereinafter arising.

(d) Seller shall provide Buyer a fully paid-up 10,000-15,000 square foot sublease in Seller’s present leased facilities in New Jersey from the Closing until December 23, 2005, for Buyer’s temporary operation of the acquired Microanalysis Business.

2.3 Assignments. Without limiting the foregoing, at the Closing, Seller and PGT-UK shall deliver to Buyer, duly executed by them: (i) a General Assignment and Bill of Sale (the “General Assignment”); (ii) such other good and sufficient instruments of conveyance, assignment and transfer, in form and substance reasonably acceptable to Buyer’s counsel, as shall be effective to vest in Buyer good and valid title in and to the Acquired Assets (the General Assignment and the other instruments referred to in clause (ii) being collectively referred to herein as the “Assignments”).

2.4 Transferred Contracts. On or prior to the Closing: (i) Seller shall deliver to Buyer all of the Transferred Contracts, including the Third Party Technology Contracts; and (ii) for each such Transferred Contract, at the option of Buyer, Seller shall deliver to Buyer, where required by the terms of the Transferred Contract, a written agreement in a form satisfactory to Buyer, signed by the party or parties to such Transferred Contract pursuant to which such party or parties thereto (x) consent to the transfer and assignment of such Transferred Contract to Buyer, where such consent is required under the terms of such Transferred Contract; and (y) confirm that Buyer will have all rights that Seller had under such Transferred Contract.

2.5 Further Assurances. (a) At any time or from time to time after the Closing, at Buyer’s request and without any further consideration, Seller and PGT-UK shall (i) execute and deliver to Buyer such other instruments of sale, transfer, conveyance, assignment and confirmation; (ii) provide such materials and information; and (iii) take such other actions as Buyer may reasonably deem necessary or desirable in order more effectively to transfer, convey and assign to Buyer, and to confirm Buyer’s title to, all of the Acquired Assets, and, to the full extent permitted by law, to put Buyer in actual possession and operating control of the Acquired Assets and to assist Buyer in exercising all rights with respect thereto, and otherwise to cause Seller to fulfill its obligations under this Agreement and the other Transaction Documents.

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

(b) Effective on the Closing Date, Seller and PGT-UK hereby constitute and appoint Buyer the true and lawful attorney of Seller and PGT-UK, with full power of substitution, in the name of Seller or Buyer, but on behalf of and for the benefit of Buyer: (i) to demand and receive from time to time any and all of the Acquired Assets and to make endorsements and give receipts and releases for and in respect of the same and any part thereof; (ii) to institute, prosecute, compromise and settle any and all actions, suits, proceedings, arbitration, or governmental or regulatory investigations or audits (“Actions or Proceedings”) that Buyer may deem proper in order to collect, assert or enforce any claim, right or title of any kind in or to the Acquired Assets; (iii) to defend or compromise any or all Actions or Proceedings in respect of any of the Acquired Assets; and (iv) to do all such acts and things in relation to the matters set forth in the preceding clauses (i) through (iii) as Buyer shall deem desirable; provided, however, that if any of the actions authorized by this Section 2.5(b) could reasonably be determined to result in a claim for indemnification by Buyer against Seller, then Buyer shall not take any such actions without complying with the procedures set forth in Section 8.3. Seller and PGT-UK hereby acknowledge that the appointment hereby made and the powers hereby granted are coupled with an interest and are not and shall not be revocable by either of them in any manner or for any reason.

(c) Following the Closing, Seller and PGT-UK will afford Buyer, its counsel and its accountants, during normal business hours and upon reasonable notice to Seller and PGT-UK, reasonable access to the books, records and other data relating to the Products in Seller’s or PGT-UK’s possession with respect to periods prior to the Closing and the right to make copies and extracts therefrom, to the extent that such access may be reasonably required by Buyer in connection with: (i) the preparation of tax returns; (ii) the determination or enforcement of rights and obligations under this Agreement, including, without limitation, by any Indemnified Party; (iii) compliance with the requirements of any Governmental Entity; or (iv) in connection with any actual or threatened Action or Proceeding.

2.6 Assumed Liabilities. As of the Closing, Buyer will assume the following, and only the following, obligations of Seller and PGT-UK (collectively, the “Assumed Liabilities”):

(a) Transferred Contracts. Those executory obligations of Seller under the Transferred Contracts, in each case solely on a going-forward basis from and after the Closing Date and excluding any and all obligations of Seller incurred prior to the Closing Date.

(b) Purchase Orders. Customer purchase orders for Products received by Seller and PGT-UK prior to the Closing that have not yet been delivered, ***. If Seller or PGT-UK has received down-payments for customer purchase orders for Products other than service prior to the Closing, which have not yet been delivered or accepted by the customer prior to the Closing, then the amount of these down-payments is credited to the Buyer at the Closing.

(c) Service. Warranty service for Products delivered by Seller and PGT-UK prior to the Closing which are still under warranty as listed in Schedule 2.6(c) and the fulfillment

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

of service contracts entered into by Seller for Product customers prior to the Closing, also as listed in Schedule 2.6(c). However, Seller and PGT-UK shall be responsible, at no charge, for all Detector service and repair work performed at Seller’s facility (i) called for under such service contracts until such time as the applicable contract expires or is renewed; and (ii) for Products for which Buyer has assumed the warranty obligation as listed in Schedule 2.6(c) until the applicable warranty expires, it being understood that for purposes of this Subpart (ii) all such detectors shall be deemed to have a full warranty of only six (6) months after acceptance by the customer rather than the usual twelve (12) months. ***.

(d) Bulova. Notwithstanding Section 2.6(a), with respect to the portion of the Bulova order, attached as Schedule 2.6(d), which remains to be performed after the Closing, the following shall occur:

(i) *** This partial cancellation or cost reduction of the Bulova order, if successfully negotiated, should be finalized at least 3 business days prior to Closing, to the reasonable satisfaction of Buyer.

(ii) Buyer shall assume the portion of the Bulova order, whether renegotiated or not, to purchase ***.

(iii) For any remaining costs, partial cancellation payments or similar items related to the Bulova order, and actually paid by Seller to Bulova (collectively, the “Cancellation Costs”), Buyer shall partially reimburse Seller for the actual Cancellation Costs paid by Seller to Bulova by reimbursing Seller for seventy five percent (75%) of such Cancellation Costs, up to a maximum of $109,800, upon presentation of proof of payment from Seller to Bulova at the Closing, or thereafter, for a maximum period of two (2) months after the Closing. Any requests for reimbursement of Cancellation Costs for the Bulova order later than two (2) months after the Closing are excluded.

(iv) Buyer shall pay Seller at the Closing $10,355, representing 75% of Seller’s set-up costs for the Bulova order.

(v) If requested by Seller prior to the Closing, Buyer will reasonably consider a different approach to the Bulova order so long as it has the same economic effect as specified in this Section 2.6(d) and Buyer receives 25 units in good working order.

2.7 Excluded Liabilities. Except for the Assumed Liabilities specifically set forth in Section 2.6, Buyer is not assuming, and the Assumed Liabilities expressly exclude, any accounts payable, other debt, liability, duty or obligation, whether known or unknown, fixed or contingent, of Seller, including, without limitation, any liabilities or obligations related to the Products or the Business which are outstanding or unpaid as of the date hereof or connected in any way with any retirement, medical, life, disability or other employee benefit plan or employment, severance or change of control arrangement of Seller or PGT-UK (collectively, the “Excluded Liabilities”). Without limiting the foregoing, all liabilities, including any liabilities for Taxes, arising from or related to: (i) Seller’s or PGT-UK’s operations, whenever arising or

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

incurred, or Seller’s or PGT-UK’s ownership of the Products and Acquired Assets through the Closing Date; (ii) Seller’s or PGT-UK’s termination of any Contracts relating to the Business which are not Transferred Contracts; (iii) any Employee hired by Buyer that accrues or arises as of or prior to the Closing Date, or any of Seller’s or PGT-UK’s other agents, consultants, independent contractors, employees or former employees, whenever arising, in each case including workers’ compensation, severance, salary, bonuses or under any Employee Plan, whether or not any such employees shall accept employment with Buyer in connection with the transactions contemplated hereby; (iv) the Products or the Business and arising prior to the Closing Date; (v) any Benefits Liabilities; and (vi) any implied or explicit warranty obligations of Seller with respect to the Products entered into prior to the Closing Date (except as described in Section 2.6(c)), shall be Excluded Liabilities and shall remain the responsibility of Seller and PGT-UK, except as otherwise specifically included within the Assumed Liabilities.

2.8 Intent. It is the intent of the parties that the transactions described in this Section 2.0 and elsewhere in this Agreement be viewed in the content of the following, which represents the intent of the parties:

(a) ***

(b) Buyer intends to transfer in-house service/repair and field service management of the Business to its Madison, Wisconsin facility.

(c) ***

(d) Buyer shall be free to hire such employees of the Business as Buyer desires. Buyer intends to hire various of these employees without relocating them, and many will be home-based after the transition period described in Section 6.16. A list of U.S. and U.K. employees who will be offered employment by Buyer is attached hereto as Schedule 2.8(d).

(e) *** Since after the Closing Seller will no longer possess any research and development or manufacturing skills for the Business, the parties assume that Buyer will be responsible for obtaining such skills if it needs them.

3.0 CLOSING AND CONSIDERATION

3.1 Closing. The closing of the transactions contemplated by this Agreement and the other Transaction Documents (the “Closing”) will take place at the offices of Seller commencing at 10:00 a.m., local time, *** 2005 or on such other date as the parties may mutually determine (the “Closing Date”). In the event the Closing is delayed by force majeure, such as weather, terrorism or act of government, the Closing shall occur as soon as the force majeure event has ended.

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission

pursuant to an application for an order declaring confidential treatment thereof.

3.2 Consideration. Buyer shall pay Seller a purchase price of One Million Eight Hundred Eighty Five Thousand Dollars ($1,885,000) for the Acquired Assets, payable as follows:

(a) Two Hundred Fifty Thousand Dollars ($250,000) shall be payable in escrow to Nixon Peabody LLP simultaneously with the execution hereof as a deposit to be released from escrow to Seller at the Closing, or on November 15, 2005, if the Closing does not occur on or before November 14, 2005 for any reason other than (i) a mutual written agreement between Seller and Buyer to extend the time of the Closing, (ii) force majeure as described in the last sentence of Section 3.1, or (iii) the failure of Seller, Principal Stockholders and PGT-UK to achieve the conditions to Closing set forth in Section 7.2. If the Closing does not occur due to such failure to achieve the conditions to Closing set forth in Section 7.2, this deposit shall be returned to Buyer.

(b) One Million Two Hundred Thousand Dollars ($1,200,000) shall be paid at the Closing, in addition to the payment under Section 3.2(a). A portion of this payment shall be made to pay all amounts owed to Outokumpu Oyi in exchange for which documentation releasing all Liens shall be obtained.

(c) Four Hundred Thirty Five Thousand Dollars ($435,000) shall be paid into escrow at Nixon Peabody LLP at the Closing pursuant to the Escrow Agreement attached hereto as Exhibit 3.2(c) (the “Escrow Agreement”), where it shall be held for a period of twelve (12) months after the Closing. Upon the one-year anniversary of the Closing Date, the funds, including interest, shall be released, in full, to Seller provided that neither Seller, PGT-UK or Principal Stockholders have not breached their obligations under Section 6.6(a) through Section 6.6(d). Should either Seller, PGT-UK or Principal Stockholders breach their obligations under Section 6.6(a) through Section 6.6(d) prior to the one-year anniversary of the Closing Date, then such funds, including interest, shall be returned, in full, to Buyer.

(d) All amounts shall be paid by wire transfer.

3.3 Allocation. The parties hereto intend that the purchase be treated as a taxable transaction for federal and state income tax purposes. Prior to the Closing Date, Buyer and Seller shall negotiate in good faith and determine the allocation of the aggregate value of the consideration among the Acquired Assets (the “Allocation”). The Allocation shall be conclusive and binding upon Buyer and Seller for all purposes, and all returns and reports (including IRS Form 8594) and all financial statements shall be prepared in a manner consistent with (and the parties shall not otherwise file a Tax return position inconsistent with) the Allocation unless required by the IRS or any other applicable taxing authority.

3.4 Transfer Taxes. Seller and Principal Stockholders shall be jointly and severally responsible for any sales, use, excise or similar Taxes (“Transfer Taxes”) that may be payable in connection with the sale or purchase of the Acquired Assets hereunder. The parties hereto shall cooperate with each other and use their commercially reasonable efforts to minimize the Transfer Taxes attributable to the sale of the Acquired Assets.

4.0 REPRESENTATIONS AND WARRANTIES OF SELLER, PGT-UK AND PRINCIPAL STOCKHOLDERS

Except as specifically disclosed in the various schedules (referencing the appropriate Section and paragraph numbers), each of Seller, PGT-UK and Principal Stockholders hereby jointly and severally represent and warrant to Buyer as of the date of this Agreement, as follows:

4.1 Organization. (a) Seller has no subsidiaries other than PGT-UK.

(b) Seller and PGT-UK are corporations duly organized, validly existing and in good standing under the laws of the jurisdictions of their incorporation and have all necessary corporate power and authority (i) to conduct their respective businesses in the manner in which they are currently being conducted; (ii) to own and use their respective assets in the manner in which their respective assets are currently owned and used; and (iii) to perform their respective obligations under all Contracts by which they are bound.

(c) Seller has delivered or made available to Buyer a true and correct copy of the certificate of incorporation (including any Certificate of Designations) and bylaws of Seller and PGT-UK and similar governing instruments, each as amended to date (collectively, the “Seller Charter Documents”), and each such instrument is in full force and effect. Seller and PGT-UK are not in violation of any of the applicable provisions of the Seller Charter Documents.

4.2 Authority. Seller and PGT-UK have all requisite power and authority and Principal Stockholders have the legal capacity to enter into this Agreement and the other Transaction Documents, as applicable, and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action on the part of Seller and PGT-UK, and, except for approval by the other stockholders of Seller, no further action is required on the part of Seller, PGT-UK or Principal Stockholders to authorize this Agreement and the other Transaction Documents and the transactions contemplated hereby. This Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby have been unanimously approved by the Boards of Directors of Seller and PGT-UK. This Agreement and the other Transaction Documents have been duly executed and delivered by each of Seller, PGT-UK and Principal Stockholders, as applicable, and constitute valid and binding obligations of each of Seller, PGT-UK and Principal Stockholders, enforceable against each of Seller, PGT-UK and Principal Stockholders in accordance with their terms, except as such enforceability may be subject to the rules of law governing specific performance, injunctive relief, or other equitable remedies.

4.3 No Conflict. The execution and delivery of this Agreement and the other Transaction Documents by each of Seller, PGT-UK and Principal Stockholders, as applicable, do not, and the performance of this Agreement and the other Transaction Documents by Seller, PGT-UK and Principal Stockholders will not, (i) conflict with or violate the Seller Charter Documents, (ii) subject to obtaining the approval and adoption of this Agreement and the approval of the transactions contemplated hereby by Seller’s stockholders as contemplated in

Section 6.13, conflict with or violate any law, rule, regulation, order, judgment or decree applicable to Seller, PGT-UK or Principal Stockholders or by which Seller, PGT-UK or Principal Stockholders or any of their properties is bound or affected, or (iii) result in any material breach of or constitute a material default (or an event that with notice or lapse of time or both would become a material default) under, or impair Seller’s, PGT-UK’s or Principal Stockholders’ rights or alter the rights or obligations of any third party under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the properties or assets of Seller pursuant to any material note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise, concession or other instrument or obligation to which Seller, PGT-UK or Principal Stockholders is a party or by which Seller, PGT-UK or Principal Stockholders or their assets are bound or affected. Schedule 4.3 of the Disclosure Schedule lists all consents, waivers and approvals under any of Seller’s, PGT-UK’s or Principal Stockholders’ agreements, Contracts, licenses or leases required to be obtained in connection with the consummation of the transactions contemplated hereby, which, if individually or in the aggregate were not obtained, would result in a material loss of benefits to any of the parties hereto as a result of the transactions contemplated hereby.

4.4 Financial Statements. Seller has furnished and made available to Buyer copies of its unaudited financial statements, consisting of its Microanalysis Business balance sheet as of September 30, 2005 and unaudited Microanalysis Business statements of income for the month and year-to-date period then ended (collectively, the “Financial Statements”) as well as Microanalysis Business new order bookings reports for the month and year-to-date period then ended, and these documents are attached as Schedule 4.4. Seller shall update the Financial Statements and Microanalysis Business new order bookings reports for the month of October at least 3 business days prior to the Closing. The Microanalysis Business unaudited financial statements and new order bookings reports of Seller included in the Financial Statements are correct in all material respects and fairly present, in conformity with GAAP applied on a consistent basis (except as may be indicated in such financial statements or the notes thereto), the consolidated financial position of Seller and any consolidated subsidiaries at the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject to normal year-end audit adjustments in the case of unaudited interim financial statements).

4.5 Transferred Contracts. Except as listed in Schedule 4.5 (the “Excluded Contracts”), the Transferred Contracts listed on Schedule 1.1 (bbb) are all of the Contracts between Seller and any third party related to, or necessary for, the operation of the Business, and true and complete copies of all such Contracts will be delivered to Buyer within 3 business days after signing this Agreement. Each Transferred Contract is in full force and effect and Seller is not subject to any default thereunder, nor, to the knowledge of Seller, PGT-UK or of Principal Stockholders, is any party obligated to Seller pursuant to any such Transferred Contract subject to any default thereunder. Seller has neither breached, violated or defaulted under, nor received notice that Seller has breached, violated or defaulted under, any of the terms or conditions of any Transferred Contract. Seller has obtained, or will obtain prior to the Closing, all necessary consents, waivers and approvals of parties to any Transferred Contract as are required thereunder in connection with the Closing, or for any such Transferred Contract to remain in full force and effect without limitation, modification or alteration after the Closing. Following the Closing, Buyer will be permitted to exercise all of the rights Seller had under the Transferred Contracts without the payment of any additional amounts or consideration other than ongoing fees,

royalties or payments which Seller would otherwise be required to pay pursuant to the terms of such Transferred Contracts had the transactions contemplated by this Agreement and the other Transaction Documents not occurred. All Contracts involving, related to or necessary for the Business are listed in Schedule 1.1(bbb) and complete copies of all such Contracts have been delivered to Buyer.

4.6 Consents. Except as set forth in Schedule 4.6, no consent, waiver, approval, order or authorization of, or registration, declaration or filing with any Governmental Entity or any third party, including a party to any agreement with Seller or Principal Stockholders, is required by or with respect to Seller or Principal Stockholders in connection with the execution and delivery of this Agreement and the other Transaction Documents or the consummation of the transactions contemplated hereby and thereby.

4.7 No Liquidation. (a) No order has been made or petition presented, or resolution passed for the winding-up or liquidation of Seller or PGT-UK and there is not outstanding:

(i) any petition or order for the winding-up of Seller or PGT-UK;

(ii) any appointment of a receiver over the whole or part of the undertaking of assets of Seller or PGT-UK;

(iii) any petition or order for administration of Seller or PGT-UK;

(iv) any voluntary arrangement between Seller or PGT-UK and any of their respective creditors;

(v) any distress or execution or other process levied in respect of Seller or PGT-UK which remains undischarged; and

(vi) any unfulfilled or unsatisfied judgment or court order against Seller or PGT-UK.

(b) There are no circumstances which would entitle any Person to present a petition for the winding-up or administration of Seller or PGT-UK or to appoint a receiver over the whole or any part of the undertaking or assets of Seller or PGT-UK.

(c) Seller or PGT-UK is not deemed unable to pay its debts within the meaning of applicable law.

(d) The operations of Seller or PGT-UK have not been terminated.

4.8 Restrictions on Business Activities. There is no agreement (not to compete or otherwise), commitment, judgment, injunction, order or decree to which Seller or Principal Stockholders or PGT-UK is a party relating to the Business or otherwise binding upon Seller, PGT-UK, Principal Stockholders or the Business which has or may have the effect of prohibiting or impairing the transactions contemplated by this Agreement and the other Transaction Documents, any business practice of the Business, any acquisition of property (tangible or intangible) by the Business or the conduct of the Business or impairing the Acquired Assets.

15 Neither Seller nor Principal Stockholders nor PGT-UK has entered into any agreement under which the operations of the Business are restricted or which places any restrictions upon Seller, PGT-UK or Principal Stockholders with respect to selling, licensing or otherwise distributing any of the Products or providing services to customers or potential customers or any class of customers in any geographic area during any period of time or in any segment of the market.

4.9 Title and Condition. (a) Neither Seller nor Principal Stockholders nor PGT-UK owns any real property in connection with the Business, nor have they ever owned any real property in connection with the Business.

(b) Except as set forth in Schedule 4.9, Seller or PGT-UK has good and valid title to or, in the case of leased properties and assets, valid leasehold interests in, all of the Acquired Assets, free and clear of any Liens.

(c) All Tangible Assets owned or leased by Seller or PGT-UK for use in the Business are (i) adequate, in all material respects, for the conduct of the Business by Seller or PGT-UK as currently conducted and as currently contemplated to be conducted, and (ii) in good operating condition, regularly and properly maintained, subject to normal wear and tear.

(d) Buyer shall be able to use the Acquired Assets and exercise, and enjoy the benefits of, the licensed rights in substantially the same manner as Seller or PGT-UK prior to the Closing, without infringing the rights of any third party.

(e) Except as set forth in Schedule 4.9, Seller or PGT-UK has sole and exclusive ownership, free and clear of any Liens, of all customer lists, customer contact information, customer correspondence and customer licensing and purchasing histories relating to the current and former customers of the Business. No Person other than Seller or PGT-UK possesses any claims or rights with respect to use of such customer information.

4.10 Intellectual Property. (a) Except as set forth in Schedule 4.9, each item of Intellectual Property Rights for the Business is free and clear of any Liens. Seller owns exclusively, and has good title to all works of authorship and all associated copyrights that are used or embodied in, the Technology, and, except as set forth in Schedule 4.9, no other Person has any other rights thereto. All Acquired Assets shall be fully transferable and alienable by Buyer.

(b) Seller has the full and unencumbered right to assign and transfer to Buyer all of Seller’s rights in and under the Transferred Contracts without incurring, or causing Buyer to incur, any obligation to any third party, including any royalty obligations, other than those obligations that Seller would have had had such transfer not taken place.

(c) Seller has not transferred ownership of, or granted any license of or right to use, or authorized the retention of any rights to use, any Intellectual Property Right of the Business to any other Person.

(d) The Intellectual Property Rights of the Business constitute all of the Intellectual Property Rights related to, used in, necessary to, or that would be infringed by, the current operation of the Business.

(e) The Technology of the Business constitutes all of the technology related to, used in or necessary to the current operation of the Business.

(f) Seller has, and as a result of the transactions contemplated hereby, Buyer will have, the right to use, pursuant to valid licenses, all third-party Software that is material to the Business or that is used in the Business to create, modify, compile, operate or support any Software (including the Products) that is Technology of the Business.

(g) Other than the Transferred Contracts set forth on Schedule 1.1 (bbb), there are no contracts, licenses or agreements to which Seller is a Party with respect to any Intellectual Property Rights of Seller as it relates to the Business.

(h) Neither (x) the operation of the Business, including the making, using, selling, development, licensing and distribution of the Products, by either Seller or, following the Closing, by Buyer, nor (y) the Acquired Assets, did, do, or will: (i) infringe or misappropriate the Intellectual Property Rights of any Person; (ii) violate the rights of any Person (including rights to privacy or publicity); or (iii) constitute unfair competition or trade practices under the laws of any jurisdiction. Seller has not received notice from any Person claiming that the Business or the Acquired Assets infringe or misappropriate the intellectual property rights of any Person or constitute unfair competition or trade practices under the laws of any jurisdiction (nor does Seller have knowledge of any basis therefor).

(i) Except as set forth in Schedule 4.6, no licenses or other consents are required from any third party to permit Buyer to exploit the Acquired Assets as described herein. Schedule 4.10 lists all Intellectual Property included in the Acquired Assets.

(j) There are no Contracts between Seller and any other Person with respect to the Acquired Assets, including the Intellectual Property Rights with respect to the Business, under which there is any dispute or any threatened dispute regarding the scope of such Contract or performance under such Contract.

(k) To the knowledge of Seller, PGT-UK or Principal Stockholders, no Person is infringing or misappropriating the Intellectual Property Rights with respect to the Business.

(l) Seller has taken all commercially reasonable steps that are required to protect Seller’s rights in confidential information and trade secrets of Seller associated with or related to the Acquired Assets.

(m) No Acquired Asset is subject to any proceeding or outstanding decree, order, judgment, agreement or stipulation that restricts in any manner the use, transfer or licensing thereof or may affect the validity, use or enforceability of the Acquired Assets.

(n) Seller is not required to make or accrue any royalty or other payment to any third party in connection with any of the Acquired Assets or Intellectual Property Rights relating thereto.

(o) Neither this Agreement nor the transactions contemplated hereby, including the assignment to Buyer, by operation of law or otherwise, of any Contracts to which

Seller is a party, will result in (i) Buyer granting to any third party any right to or with respect to any Technology or Intellectual Property Rights owned by, or licensed to, Buyer; (ii) Buyer being bound by, or subject to, any non-compete or other restriction on the operation or scope of its businesses; or (iii) Buyer being obligated to pay any royalties or other amounts to any third party in excess of those payable by Buyer or Seller prior to the Closing.

(p) Seller has disclosed in writing to Buyer all information relating to any material problem or issue with respect to any of the Products which does, or may reasonably be expected to, adversely affect the marketing, sale or service of such Product.

4.11 Litigation. There is no action, suit, claim, proceeding or investigation of any nature pending or, to the knowledge of Seller, PGT-UK or Principal Stockholders, threatened relating to the Business, the Products, or the Acquired Assets, nor, to the knowledge of Seller, PGT-UK or Principal Stockholders, is there any reasonable basis therefor. There is no investigation or other proceeding pending or, to the knowledge of Seller, PGT-UK or Principal Stockholders, threatened relating to the Business, the Products, or the Acquired Assets by or before any Governmental Entity, nor, to the knowledge of Seller, PGT-UK or Principal Stockholders, is there any reasonable basis therefor. No Governmental Entity has at any time challenged or questioned the legal right of Seller or Principal Stockholders to conduct the Business as presently or previously conducted. There are no judgments, orders, decrees, citations, fines or penalties heretofore assessed against Seller affecting the Business, Products, or Acquired Assets under any foreign, federal, state or local law.

4.12 Brokers’ or Finders’ Fees. Neither Seller, PGT-UK nor Principal Stockholders has incurred, nor will it incur, directly or indirectly, any liability for brokerage or finders’ fees or agents’ commissions or any similar charges in connection with this Agreement or the other Transaction Documents or any transaction contemplated hereby or thereby.

4.13 Tax Matters. (a) Definition. For the purposes of this Agreement, the term “Tax” or, collectively, “Taxes” shall mean any and all federal, state, local and foreign taxes, assessments and other governmental charges, duties, impositions and liabilities, including taxes based upon or measured by gross receipts, income, profits, sales, use and occupation, and value added, ad valorem, transfer, franchise, withholding, payroll, recapture, employment, excise and property taxes as well as public imposts, fees and social security charges (including but not limited to health, unemployment and pension insurance), together with all interest, penalties and additions imposed with respect to such amounts and any obligation under any agreement or arrangement with any other person with respect to such amounts and including any liability for taxes of a predecessor entity.

(b) Returns. (i) To the extent relevant to the Acquired Assets or the Business, as of the Closing Date, Seller and PGT-UK will have prepared and timely filed all required federal, state, local and foreign returns, estimates, information statements and reports (“Returns”) relating to any and all Taxes concerning or attributable to Seller or PGT-UK or their respective operations and such Returns are or will be true and correct and have been or will be completed in accordance with applicable law.

(ii) To the extent failure to do so would adversely affect Buyer, the Acquired Assets, or Buyer’s use of the Acquired Assets or operation of the Business, as of the Closing Date, Seller and PGT-UK (A) will have paid all Taxes it is required to pay and (B) will have withheld with respect to its employees all federal, state and foreign income taxes and social security charges and similar fees, Federal Insurance Contribution Act, Federal Unemployment Tax Act and other Taxes required to be withheld.

(iii) To the extent failure to do so would adversely affect Buyer, the Acquired Assets, Buyer’s use of the Acquired Assets or operation of the Business, Seller and PGT-UK have not been delinquent in the payment of any Tax, nor is there any Tax deficiency outstanding, assessed or proposed against Seller or PGT-UK, nor have Seller or PGT-UK executed any waiver of any statute of limitations on or extending the period for the assessment or collection of any Tax.

(iv) To the extent relevant to the Acquired Assets or the Business, no audit or other examination of any Return of Seller or PGT-UK is presently in progress, nor has Seller or PGT-UK been notified of any request for such an audit or other examination.

(v) Neither Seller, PGT-UK nor Principal Stockholders have and knows of any basis for the assertion of any claim for any liabilities for unpaid Taxes for which Buyer would become liable as a result of the transactions contemplated by this Agreement and the other Transaction Documents.

(vi) There are (and immediately following the Closing there will be) no Liens on the Acquired Assets relating to or attributable to Taxes.

(vii) Neither Seller, PGT-UK nor Principal Stockholders know of any basis for the assertion of any claim relating or attributable to Taxes which, if adversely determined, would result in any Lien on the Acquired Assets.

4.14 Power of Attorney. Except as set forth in Schedule 4.14, there are no outstanding powers of attorney executed on behalf of Seller, PGT-UK or Principal Stockholders or PGT-UK in respect of the Business, the Products or the Acquired Assets except as granted to Buyer hereunder.

4.15 Affiliate Transactions. No affiliates of Seller or Principal Stockholders or PGT-UK own any of the Acquired Assets or have or had any business dealings with Seller or PGT-UK with respect to the Business, the Acquired Assets or the Products.

4.16 Compliance with Laws. Seller and PGT-UK have complied with, are not in violation of, and have not received any notices of violation with respect to, any foreign, federal, state or local statute, law or regulation with respect to the conduct or operation of the Business.

4.17 Product Warranties. Each Product provided, delivered, manufactured, sold, leased, distributed or licensed by Seller has been done so in conformity with all applicable contractual commitments and all express and implied warranties, and Seller or PGT-UK has no liability (and, to the knowledge of Seller or Principal Stockholders, there is no basis for any present or future action, suit, proceeding, hearing, investigation, charge, complaint, claim, or

demand against Seller or PGT-UK giving rise to any liability) for replacement or repair thereof or other damages in connection therewith, except as provided in such express and implied warranties. No Product provided, delivered, manufactured, sold, leased, distributed or licensed by Seller or PGT-UK is subject to any guaranty, warranty, or other indemnity beyond Seller’s applicable standard terms and conditions of sale or lease or beyond that implied or imposed by applicable law. Schedule 4.17 includes copies of the standard Product warranty and service terms and conditions.

4.18 Complete Copies. Seller has delivered or made available true and complete copies of each existing document that has been requested by Buyer or its counsel.

4.19 Bulk Transfer. Except as set forth in Schedule 4.19, there are no current or past creditors of Seller or PGT-UK to whom any law, rule or regulation requires the delivery of notice or from whom any form of consent is required in conjunction with undertaking the transactions contemplated by this Agreement and the other Transaction Documents.

4.20 Acquired Assets. Except for the Excluded Assets, the Acquired Assets comprise all of the assets, properties and rights of every type and description (other than real property) used or developed by Seller or PGT-UK and related to, required for or used in the Business as currently conducted

4.21 Business Changes. Since June 1, 2005, except as otherwise contemplated by this Agreement, Seller and PGT-UK have conducted their operation of the Business only in the ordinary and usual course and consistent with past practices and, without limiting the generality of the foregoing:

(a) There have been no changes in the condition (financial or otherwise), business, prospects, net worth, assets, operations, obligations or liabilities of the Business which, in the aggregate, have had or may be reasonably expected to have a Material Adverse Effect on the condition, business, prospects, net worth, assets or operations of the Business.

(b) Neither Seller nor Principal Stockholders nor PGT-UK has mortgaged, pledged or otherwise encumbered any of the Acquired Assets.

(c) Neither Seller nor Principal Stockholders has sold, assigned, licensed, leased, transferred or conveyed, or committed itself to sell, assign, license, lease, transfer or convey, any of the Acquired Assets, except for purchase and sale of one vehicle.

(d) There has been no destruction of, damage to or loss of any of the Acquired Assets.

(e) There has been no notice of any claim or potential claim of ownership by any Person other than Seller of the Acquired Assets or of infringement by the Business of any other Person’s Intellectual Property Rights.

(f) There has been no dispute, proceeding, litigation, arbitration or mediation pending or threatened against Seller or PGT-UK related to the Business, the Products or the Acquired Assets.

(g) There has been no event or condition of any character that has had or is reasonably likely to have a Material Adverse Effect on the Business, the Products or the Acquired Assets.

(h) There has been no negotiation or agreement by Seller, Principal Stockholders, PGT-UK or any employees or agents thereof to do any of the things described in the preceding clauses (a) through (g) (other than negotiations with Buyer and their representatives regarding the transactions contemplated by this Agreement and the other Transaction Documents).

4.22 Solvency. Seller and PGT-UK are not insolvent and the transactions contemplated by this Agreement and the other Transaction Documents will not cause Seller or PGT-UK to be insolvent immediately following the Closing or at any time within ninety (90) days following the Closing.

4.23 Disclosure. None of the information supplied by or on behalf of Seller, Principal Stockholders or PGT-UK herein contains any untrue statement of a material fact or omits to state any material fact required to be stated herein or necessary in order to make the statements herein, in the light of the circumstances under which they are made, not misleading.

4.24 Environmental. (a) Hazardous Material. Seller and PGT-UK have not (i) operated any underground storage tanks at any property that Seller or PGT-UK has at any time owned, operated, occupied or leased, or (ii) illegally released any amount of any substance that has been designated by any Governmental Entity or by applicable federal, state or local law to be radioactive, toxic, hazardous or otherwise a danger to health or the environment, including, without limitation, PCBs, asbestos, petroleum, and urea-formaldehyde and all substances listed as hazardous substances pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, or defined as a hazardous waste pursuant to the United States Resource Conservation and Recovery Act of 1976, as amended, and the regulations promulgated pursuant to said laws (a “Hazardous Material”), but excluding office and janitorial supplies properly and safely maintained. To the knowledge of Seller, PGT-UK and the Principal Stockholders, except as set forth in Schedule 4.24(a) no Hazardous Materials are present in, on or under any property, including the land and the improvements, ground water and surface water thereof, that Seller or PGT-UK have at any time owned, operated, occupied or leased.

(b) Hazardous Materials. Seller and PGT-UK have not transported, stored, used, manufactured, disposed of, released or exposed its employees or others to Hazardous Materials in violation of any law in effect on or prior to the Closing, nor have Seller or PGT-UK disposed of, transported, sold, or manufactured any product containing a Hazardous Material (any or all of the foregoing being collectively referred to herein as “Hazardous Materials Activities”) in violation of any rule, regulation, treaty or statute promulgated by any Governmental Entity in effect prior to or as of the date hereof to prohibit, regulate or control Hazardous Materials or any Hazardous Material Activity.

(c) Permits. To the knowledge of Seller, PGT-UK and The Principal Stockholders, Seller or PGT-UK currently hold all environmental approvals, permits, licenses,

clearances and consents (the “Environmental Permits”) necessary for the conduct of Seller’s and PGT-UK’s Hazardous Material Activities relating to the Business as the Business is currently being conducted and as currently contemplated to be conducted.

(d) Liabilities. No action, proceeding, revocation proceeding, amendment procedure, writ, injunction or claim is pending or, to the knowledge of Seller, the Principal Stockholders or PGT-UK, threatened concerning any Environmental Permit, Hazardous Material or any Hazardous Materials Activity of Seller or PGT-UK. Seller, the Principal Stockholders and PGT-UK have no knowledge of any fact or circumstance which could involve Seller or PGT-UK in any environmental litigation or impose upon Seller or PGT-UK any environmental liability.

4.25 Employee Matters. (a) Plan Compliance. (i) Seller and PGT-UK have performed all obligations required to be performed by them under, is not in default or violation of, and have no knowledge of any default or violation by any other party to, each Employee Plan relevant to the Business, and each Employee Plan relevant to the Business has been established and maintained in accordance with its terms and in compliance with all applicable laws, statutes, orders, rules and regulations, including in the case of Seller, but not limited to, ERISA or the Code; (ii) there are no actions, suits or claims pending, or, to the knowledge of Seller, Principal Stockholders or PGT-UK, threatened or reasonably anticipated (other than routine claims for benefits) against any Employee Plan relevant to the Business or against the assets of any Employee Plan relevant to the Business; and (iii) there are no audits, inquiries or proceedings pending or, to the knowledge of Seller or any ERISA Affiliates, threatened by the IRS or DOL with respect to any Employee Plan relevant to the Business.

(b) Post-Employment. No Employee Plan relevant to the Business provides, or reflects or represents any liability to provide, retiree health to any person for any reason, except as may be required by COBRA or other applicable statute, and Seller has never represented, promised or contracted (whether in oral or written form) to any Employee, (either individually or to Employees as a group) or any other person that such Employee(s) or other person would be provided with retiree health, except to the extent required by statute.

(c) Effect. (i) The execution of this Agreement and the consummation of the transactions contemplated hereby will not (either alone or upon the occurrence of any additional or subsequent events) constitute an event under any Employee Plan, Employment Agreement, trust or loan that will or may result in any payment (whether of severance pay or otherwise), acceleration, forgiveness of indebtedness, vesting, distribution, increase in benefits or obligation to fund benefits with respect to any Employee.

(ii) No payment or benefit which will or may be made by Seller or its ERISA Affiliates with respect to any Employee or any other “disqualified individual” (as defined in Code Section 280G and the regulations thereunder) will be characterized as a “parachute payment,” within the meaning of Section 280G(b)(2) of the Code.

(d) Employment. Seller and PGT-UK (i) are in compliance in all respects with all applicable foreign, federal, state and local laws, rules and regulations respecting employment, employment practices, terms and conditions of employment and wages and hours, in

each case, with respect to Employees relevant to the Business; (ii) have withheld and reported all amounts required by law or by agreement to be withheld and reported with respect to wages, salaries and other payments to Employees relevant to the Business; (iii) are not liable for any arrears of wages or any taxes or any penalty for failure to comply with any of the foregoing relevant to the Busienss; and (iv) are not liable for any payment to any trust or other fund governed by or maintained by or on behalf of any governmental authority, with respect to unemployment compensation benefits, social security or other benefits or obligations for Employees relevant to the Business (other than routine payments to be made in the normal course of business and consistent with past practice). There are no pending, threatened or reasonably anticipated claims or actions against Seller or PGT-UK relevant to the Business under any worker’s compensation policy or long-term disability policy.

(e) Labor. No work stoppage or labor strike relevant to the Business against Seller or PGT-UK is pending, threatened or reasonably anticipated. Neither Seller nor Principal Stockholders nor PGT-UK know of any activities or proceedings of any labor union to organize any Employees related to the Business. There are no actions, suits, claims, labor disputes or grievances pending, or, to the knowledge of Seller, Principal Stockholders or PGT-UK, threatened or reasonably anticipated relating to any labor, safety or discrimination matters involving any Employee, including, without limitation, charges of unfair labor practices or discrimination complaints, which, if adversely determined, would, individually or in the aggregate, result in any material liability to Seller or PGT-UK. Seller and PGT-UK have not engaged in any unfair labor practices relevant to the Business within the meaning of the National Labor Relations Act. Seller and PGT-UK are not presently, nor have they been in the past, a party to, or bound by, any collective bargaining agreement or union contract with respect to Employees relevant to the Business and no collective bargaining agreement is being negotiated by Seller or PGT-UK relevant to the Business.

(f) International. Seller and PGT-UK do not now, nor have they ever had the obligation to, maintain, establish, sponsor, participate in, or contribute to any International Employee Plan relevant to the Business.

5.0 REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer hereby represents and warrants to Seller, PGT-UK and Principal Stockholders as of the date of this Agreement as follows:

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

5.2 Authority. Buyer has all requisite corporate power and authority to enter into this Agreement and the other Transaction Documents and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action on the part of Buyer. This Agreement and the other Transaction Documents have been duly executed and delivered by Buyer and constitute the valid and binding obligations of Buyer, enforceable in accordance with their terms, except as such enforceability may be limited by principles of public policy and

subject to the rules of law governing specific performance, injunctive relief or other equitable remedies.

5.3 No Conflict. Neither the execution and delivery of this Agreement nor the other Transaction Documents, nor the consummation of the transactions contemplated hereby and thereby, will conflict with, or result in any violation of, or default under (with or without notice or lapse of time, or both) (i) any provision of the certificate of incorporation, as amended, and bylaws, as amended, of Buyer, (ii) any Contract to which Buyer or any of its properties or assets are subject, or (iii) any judgment, order, decree, statute, law, ordinance, rule or regulation applicable to Buyer or its properties or assets, except in each case where such conflict, violation or default will not have a Material Adverse Effect on Buyer or will not affect the legality, validity or enforceability of this Agreement or the other Transaction Documents.

5.4 Consents. No consent, waiver, approval, order or authorization of, or registration, declaration or filing with, any Governmental Entity, or any third party is required by or with respect to Buyer in connection with the execution and delivery of this Agreement and the other Transaction Documents or the consummation of the transactions contemplated hereby and thereby, except for such consents, waivers, approvals, orders, authorizations, registrations, declarations and filings which, if not obtained or made, would not have a Material Adverse Effect on Buyer.

5.5 Brokers’ and Finders’ Fees. Buyer has not incurred, nor will incur, directly or indirectly, any liability for brokerage or finders’ fees or agents’ commissions or any similar charges in connection with this Agreement or any transaction contemplated hereby.

6.0 COVENANTS AND AGREEMENTS

6.1 Access. During the period commencing on the date of this Agreement and continuing through the Closing Date, Seller and PGT-UK, upon reasonable prior notice from Buyer to Seller or PGT-UK, will (a) afford to Buyer and its representatives, at all reasonable times during normal business hours, full and complete access to Seller’s or PGT-UK’s professional advisors, properties, Contracts, Books and Records, and other documents and data, (b) furnish Buyer and its representatives with copies of all such Contracts, Books and Records, and other documents and data as Buyer may reasonably request, and (c) furnish Buyer and its representatives with such additional financial (including Tax Returns and supporting documentation), operating and other data and information as Buyer may reasonably request, in each case relating to the Business. No information or knowledge obtained in any investigation pursuant to this Section 6.1 shall affect or be deemed to modify any representation or warranty contained herein or the conditions to the obligations of the parties hereto to consummate the transactions contemplated hereby.

6.2 Operation. Between the date of this Agreement and the Closing Date, unless otherwise agreed in writing by Buyer, Seller and PGT-UK will:

(a) except as otherwise allowed or required pursuant to the terms of this Agreement, conduct the Business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted;

(b) pay the debts and Taxes of the Business when due;

(c) pay or perform other obligations of the Business when due;

(d) use commercially reasonable efforts to preserve intact the current business organization of Seller and PGT-UK relating to the Business, keep available the services of the current officers, employees and agents of Seller and PGT-UK relating to the Business, and maintain the relations and goodwill with the suppliers, customers, Distributors, licensors, licensees, landlords, trade creditors, employees, agents and others having business relationships with Seller or PGT-UK relating to the Business, with the goal of preserving unimpaired the goodwill and ongoing business of the Business as of the Closing;

(e) confer with Buyer concerning business or operational matters relating to the Business of a significant nature;

(f) use commercially reasonable efforts to maintain all of the Acquired Assets in their current condition, ordinary wear and tear excepted and, in the event of any damage to or destruction of any of the Acquired Assets prior to the Closing Date, promptly replace, repair or restore such Acquired Assets;

(g) make sales of the Products consistent with past practice;

(h) maintain the Books and Records in the usual, regular and ordinary manner, on a basis consistent with prior years; and

(i) report to Buyer concerning any event or occurrence not in the ordinary course of the operation of the Business or any material event involving the Business.

6.3 Conduct. Except as otherwise expressly permitted by this Agreement, between the date of this Agreement and the Closing Date, neither Seller, PGT-UK nor Principal Stockholders will take any action, or fail to take any action, as a result of which any of the changes or events described in Section 4.21 of this Agreement would occur. In addition, neither Seller, PGT-UK nor Principal Stockholders will, without the prior written consent of Buyer:

(a) take any action to impair, encumber, create a Lien against or otherwise adversely affect the Acquired Assets;

(b) propose or enter into a Contract with any person, other than Buyer, providing for the possible acquisition, transfer or disposition (whether by way of merger, purchase of capital stock, purchase of assets or otherwise) of any of the Acquired Assets except in the ordinary course of business;

(c) enter into any Contract relating to any of the Acquired Assets, except in the ordinary course of business;

(d) change pricing or royalties charged to customers or licensees of the Business;

(e) enter into any strategic arrangement or relationship, development or joint marketing arrangement or agreement relating to the Business;

(f) fire, or give notice of termination to, any Employee relevant to the Business;

(g) hire any employees relating to the Business;

(h) change, increase or amend the rate of remuneration or amount of bonuses or other benefits or any other terms of employment of any Employee relevant to the Business (whether payable in cash, equity compensation or otherwise) in a manner inconsistent with past practices;

(i) grant any severance or termination pay to any Employee relevant to the Business (whether payable in cash, equity compensation or otherwise), or adopt any new severance plan, amend or modify or alter in any manner any severance plan, agreement or arrangement relating to any Employee relevant to the Business on the date hereof;

(j) adopt or amend any Employee Plan relevant to the Business, or enter into any Employment Agreement relevant to the Business;

(k) amend or modify, or violate the terms of, any of the Transferred Contracts;

(l) make or change any election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes, in each case relating in a material way to the Business, the Products and the Acquired Assets;

(m) commence or settle any Actions or Proceedings or obtain any releases of threatened Actions or Proceedings involving or relating, in a material way, to the Business;

(n) take any action, or fail to take any action, which would result in any of the representations and warranties set forth in Section 4.0 not being true and correct on and as of the Closing Date with the same force and effect as if such representations and warranties had been made on and as of the Closing Date;

(o) take, or agree in writing or otherwise to take, any of the actions described in Sections 6.3(a) through (n), or any other action that would prevent Seller or PGT-UK from performing or cause Seller or PGT-UK not to perform their covenants hereunder; or

(p) ship more Products prior to Closing than in the normal course of business to minimize the Acquired Assets and to maximize Seller’s retained financial assets, such as accounts receivable.

6.4 Confidentiality. The information obtained in any investigation pursuant to Section 6.1 hereof, or pursuant to the negotiation and execution of this Agreement or the

effectuation of the transactions contemplated hereby, shall be governed by the terms of the Confidentiality Agreement between Buyer and Seller dated February 7^th, 2005.

6.5 Confidential Information. Notwithstanding anything to the contrary contained herein or in any other agreement of Seller, including any agreement between Seller and any Employee, Buyer shall have the unrestricted, sublicensable and transferable right, and Seller hereby consents to such rights of Buyer, after the Closing to use, disclose and exploit in any manner and without restriction any and all confidential information disclosed to, or learned by, Buyer in connection with the transactions contemplated hereby except to the extent that such confidential information relates to the Excluded Assets, disclosed by or embodied in any of the Acquired Assets, or known to any Employee except to the extent that such confidential information relates to the Excluded Assets. To the extent that any Employee may be bound by any agreement or policy of Seller or PGT-UK that would in any way limit or restrict the rights of Buyer to confidential information hereunder, Seller and PGT-UK shall not assert, enforce or otherwise exercise its rights under such agreement or policy against any Employee or Buyer. In addition, Seller and PGT-UK shall maintain and preserve the confidentiality of the Acquired Assets.

6.6 Covenant Not to Compete or Solicit. (a) Beginning on the Closing Date and ending on the fifth (5th) anniversary of the Closing Date (the “Non-Competition Period”), neither Seller, PGT-UK nor Principal Stockholders shall, directly or indirectly (other than on behalf of Buyer), engage in a Competitive Business Activity (as defined below) anywhere in the world. For all purposes hereof, the term “Competitive Business Activity” shall mean: (i) engaging in, managing or directing persons engaged in any business involving the Microanalysis market segment; (ii) acquiring or having an ownership interest in any entity which derives revenues from any business involving the Microanalysis market segment (except for ownership of one percent (1%) or less of any entity whose securities have been registered under the Securities Act, or Section 12 of the Exchange Act); or (iii) participating in the financing, operation, management or control of any firm, partnership, corporation, entity or business described in clause (ii) of this sentence. In addition, during the Non-Competition Period neither Seller, PGT-UK nor Principal Stockholders shall, directly or indirectly, market, sell, or otherwise distribute Detector Products into the Microanalysis market either to end users or to re-sellers other than through Buyer; provided, however, that Seller shall have the right to market, sell and otherwise distribute Detector Products to customers outside the field of Microanalysis, such as nuclear (gamma, neutron) detection, industrial (non-microanalysis) x-ray inspection tools and medical diagnostics.

In particular, Seller, PGT-UK or Principal Shareholders shall not sell any X-ray analysis products or related components or software, including, but not limited to, Detector Products, for the use in the following applications: (A) Scanning Electron Microscopes (SEM) or Transmission Electron Microscopes (TEM), or (B) stand-alone general purpose X-ray fluorescence (XRF) microanalysis equipment capable of an analytical spot size <1mm (such as equipment similar to the EDAX Eagle products).

Seller shall not be prohibited from selling or distributing Detector Products for use in the following applications: (X) X-ray emitting machines for fundamental research such as Synchrotrons, particle accelerators or similar equipment, (Y) specialized (not general purpose)

X-ray inspection and metrology tools for specific industrial applications (such as, for example, the Hitachi RS-4000 semiconductor wafer inspection instrument), whether electron beam or XRF based, regardless of spot size, or (Z) XRF equipment that is not used for Microanalysis, i.e, with an analytical spot size greater than 1 mm.

(b) In addition, if a particular OEM re-seller customer of Seller makes both Microanalysis tools and other types of instruments, PGT shall not be prohibited from selling Detector Products to such OEM customer as long as such OEM customer does not use any such items for Microanalysis, and certifies this in writing to Buyer. As an example of the application of the immediately preceding sentence, an OEM customer which makes both electron microscopes and medical imaging systems could not obtain Detector Products from Seller for use in electron microscopes, but could obtain such items from Seller for use in medical imaging systems.

(c) ***

(d) Beginning on the Closing Date and ending on the fifth (5th) anniversary of the Closing Date, neither Seller, PGT-UK nor Principal Stockholders shall, directly or indirectly, hire, retain, solicit, encourage or take any other action which is intended to induce or encourage, or has the effect of inducing or encouraging, any employee of Buyer to terminate his or her employment.

(e) In the event that the provisions of Section 6.6(a) through 6.6(d) are deemed to exceed the time, geographic or scope limitations permitted by applicable law, then such provisions shall be reformed to the maximum time, geographic or scope limitations, as the case may be, permitted by applicable laws.

(f) Seller, PGT-UK and Principal Stockholders acknowledge that (i) the goodwill associated with the existing business, customers and assets of the Business prior to the Closing are an integral component of the value of the Business to Buyer and is reflected in the value of the consideration to be received by Seller, and (ii) Seller’s, PGT-UK’s and Principal Stockholders’ agreements as set forth in Sections 6.6(a) through Section 6.6(d) are necessary to preserve the value of the Business for Buyer following the Closing. Seller, PGT-UK and Principal Stockholders also acknowledge that the limitations of time, geography and scope of activity agreed to in Section 6.6(a) through Section 6.6(d) are reasonable because, among other things, (A) Buyer and Seller are engaged in a highly competitive industry, (B) each of Seller, PGT-UK and Principal Stockholders has had unique access to the trade secrets and know-how of the Business, including, without limitation, the plans and strategy (and, in particular, the competitive strategy) of the Business, and (C) each of Seller and Principal Stockholders is receiving significant consideration in connection with the consummation of the transactions contemplated by this Agreement and the other Transaction Documents.

(g) In the event of a breach or threatened breach by Seller, PGT-UK or Principal Stockholders of any of the covenants set forth in Sections 6.6(a) through 6.6(d), monetary damages alone would be inadequate to fully protect Buyer from, and compensate

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

Buyer for, the harm caused by such breach or threatened breach. Accordingly, if either Seller, PGT-UK or Principal Stockholders breaches or threatens to breach any provision of Sections 6.6(a) through 6.6(d), Buyer shall be entitled to, in addition to any other right or remedy otherwise available, injunctive relief restraining such breach or threatened breach and to specific performance of any such provision of Sections 6.6(a) through 6.6(d), and Buyer shall not be required to post a bond in connection with, or as a condition to, obtaining such relief before a court of competent jurisdiction.

(h) In the event that Seller has any doubts on whether a potential sale or transaction violates Sections 6.6(a) through 6.6(d), Seller has the option to submit a detailed written request to Buyer, and Buyer shall respond within ten (10) business days whether or not such proposed sale or transaction in Buyer’s opinion would violate Sections 6.6(a) through 6.6(d). Buyer’s failure to respond within said ten (10) business days shall constitute Buyer’s approval of the proposed sale or transaction.

6.7 No Solicitation. (a) From and after the date of this Agreement until the Closing Date or termination of this Agreement pursuant to Section 9.0, neither Seller, PGT-UK nor Principal Stockholders will nor will any of them authorize or permit any of their respective officers, directors, affiliates or employees or any investment banker, attorney or other advisor or representative retained by any of them to, directly or indirectly, (i) solicit, initiate, encourage or induce the making, submission or announcement of any Acquisition Proposal (as hereinafter defined), (ii) participate in any discussions or negotiations regarding, or furnish to any person any non-public information with respect to, or take any other action to facilitate any inquiries or the making of any proposal that constitutes or may reasonably be expected to lead to, any Acquisition Proposal, (iii) engage in discussions with any person with respect to any Acquisition Proposal, except as to the existence of these provisions, (iv) approve, endorse or recommend any Acquisition Proposal, or (v) enter into any letter of intent or similar document or any contract, agreement or commitment contemplating or otherwise relating to any Acquisition Transaction.

(b) For purposes of this Agreement, “Acquisition Proposal” shall mean any offer or proposal (other than an offer or proposal by Buyer) relating to any Acquisition Transaction. For purposes of this Agreement, “Acquisition Transaction” shall mean any transaction or series of related transactions involving: (i) any purchase from Seller, PGT-UK or Principal Stockholders or acquisition by any person or “group” (as defined under Section 13(d) of the Exchange Act and the rules and regulations thereunder) of more than a 10% interest in the total outstanding voting securities of Seller or any tender offer or exchange offer that if consummated would result in any person or “group” (as defined under Section 13(d) of the Exchange Act and the rules and regulations thereunder) beneficially owning 10% or more of the total outstanding voting securities of Seller or any merger, consolidation, business combination or similar transaction involving Seller; (ii) any sale, lease (other than in the ordinary course of business), exchange, transfer, license (other than non-exclusive licenses in the ordinary course of business), acquisition or disposition of more than 10% of the assets of Seller or of any of the Acquired Assets; or (iii) any liquidation or dissolution of Seller or PGT-UK.

(c) In addition to the obligations of Seller, PGT-UK and Principal Stockholders set forth in Section 6.7(a), each of Seller, PGT-UK and Principal Stockholders as promptly as practical shall advise Buyer orally and in writing of any Acquisition Proposal or any

request for non-public information or inquiry which Seller, PGT-UK or Principal Stockholders reasonably believe would lead to an Acquisition Proposal or to any Acquisition Transaction, or any inquiry with respect to or which Seller, PGT-UK or Principal Stockholders reasonably should believe would lead to any Acquisition Proposal, the material terms and conditions of such Acquisition Proposal or request inquiry, and the identity of the person or group making any such request, Acquisition Proposal or inquiry. Each of Seller, PGT-UK and Principal Stockholders will keep Buyer informed as promptly as practicable in all material respects of the status and details (including amendments or proposed amendments) of any such request, Acquisition Proposal or inquiry.

6.8 Notification . Each of Seller, PGT-UK and Principal Stockholders shall give prompt notice to Buyer of (i) the occurrence or non-occurrence of any event, the occurrence or non-occurrence of which is likely to cause any representation or warranty of Seller, PGT-UK or Principal Stockholders contained in this Agreement to be untrue or inaccurate at or prior to the Closing, and (ii) any failure of Seller, PGT-UK or Principal Stockholders to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder; provided, however, that the delivery of any notice pursuant to this Section 6.8 shall not (a) limit or otherwise affect any remedies available to the party receiving such notice, or (b) constitute an acknowledgment or admission of a breach of this Agreement. No disclosure by Seller, PGT-UK or Principal Stockholders pursuant to this Section 6.8, however, shall be deemed to amend or supplement the Disclosure Schedule or prevent or cure any misrepresentations, breach of warranty or breach of covenant.

6.9 Employment. Buyer shall have the right to contact Seller’s and PGT-UK’s employees of the Business for the purpose of negotiating with them their possible employment by Buyer after the Closing, including the possible negotiation of future employment agreements.

(a) Buyer will offer employment to all U.S. employees listed on Schedule 2.8(d) on terms substantially equivalent to those under which said employees are currently employed by Seller, except for office location in New Jersey, but none of these employees will be required to relocate, except that they will have to be present at Buyer’s Madison, WI, office from time to time, e.g. for customer demos or internal meetings. ***

(b) Moreover, Buyer will offer employment to the employees of PGT-UK listed in Schedule 2.8(d) on terms substantially equivalent to those under which said employees are currently employed by PGT-UK, without the need for relocation, except that they will have to be present at Buyer’s Coventry, UK, office from time to time, e.g. for customer demos or internal meetings.

(c) Buyer will pay to Seller seventy five percent (75%) of actually paid severance with respect to those employees listed on Schedule 6.16 to whom employment is not being offered by Buyer, with the maximum severance amount for each such employee being listed on Schedule 6.16 and a cumulative maximum amount of $130,432 (the “Severance Costs”). Seller will try to negotiate down the Severance Costs after the signing of this Agreement, and Seller will submit to Buyer a finalized list of Severance Costs at least 3 days

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

prior to the Closing, or as soon as reasonably possible, with individual severance amounts not to exceed those in Schedule 6.16 and to be subject to such cumulative amount. The Severance Costs reimbursement will be added to the payment under Section 3.2(b) due to Seller at Closing for actual severance payments made by Seller prior to the Closing, and for which Buyer has received proof of payment by Seller. Any remaining Severance Costs will be placed in escrow with Nixon Peabody LLP pursuant to the Escrow Agreement and will be paid to Seller upon presentation of proof of severance payment from Seller to the employees for a maximum period of four (4) months after the Closing. Any requests by Seller for reimbursement of Severance Costs from Buyer later than four (4) months after the Closing are excluded, and any amount remaining in escrow at such time will be returned to Buyer. Buyer is not liable for any severance costs of employees to whom Buyer offered a full-time position, but who declined Buyer’s job offer.

6.10 Disclosure. Except as may be required by law (including a Form 8-K and related press release with an advance copy to be provided to Seller) or any listing agreement with a national securities exchange, no party shall issue any statement or communication to any third party (other than their respective agents) regarding the subject matter of this Agreement or the transactions contemplated hereby, including, if applicable, the termination of this Agreement and the reasons therefor, without the consent of the other party, which consent shall not be unreasonably withheld.

6.11 Consents. Seller shall obtain the consents, waivers and approvals under any of the Transferred Contracts as may be required in connection with this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby so as to assign all rights and benefits thereunder to Buyer.

6.12 Benefits. From and after the Closing Date, Seller, PGT-UK and any ERISA Affiliates shall (i) sponsor and (ii) assume or retain, as the case may be, and be solely responsible for all Benefits Liabilities relating to Employees of the Business arising under, resulting from or relating to any Employee Plans.

6.13 Consent. Principal Stockholders, as 100% of the stockholders of Seller, will vote in favor of adopting and approving this Agreement and the transactions contemplated hereby.

6.14 Reasonable Efforts. Subject to the terms and conditions provided in this Agreement, each of the parties hereto shall use commercially reasonable efforts to take promptly, or cause to be taken promptly, all actions, and to do promptly, or cause to be done promptly, all things necessary, proper or advisable under applicable laws and regulations to consummate and make effective the transactions contemplated hereby, to obtain all necessary waivers, consents and approvals and to effect all necessary registrations and filings and to remove any injunctions or other impediments or delays, legal or otherwise, in order to consummate and make effective the transactions contemplated by this Agreement and the other Transaction Documents for the purpose of securing to the parties hereto the benefits contemplated by this Agreement.

6.15 Further Assurances. Each party hereto, at the request of another party hereto, shall execute and deliver such other instruments and do and perform such other acts and things as

may be necessary or desirable for effecting completely the consummation of this Agreement and the transactions contemplated hereby.

6.16 Transition. For a period of two (2) months after the Closing, in return for the payment of a fee from Buyer not to exceed $132,776, Seller shall maintain as employees and make fully available to Buyer for transition assistance the Transition employees listed on Schedule 6.16. This sum shall fully compensate for all salaries, fringe benefits of any kind, and any other related costs that Seller may incur in this context. This sum shall be paid to Seller in equal installments, on a bi-weekly basis by wire transfer on the date of Seller’s payroll, throughout the two month transition period, unless one or several Transition employees resign or are not available to Buyer as intended by this Section 6.16, in which case the bi-weekly amount is reduced by the salary plus 20% fringe rate for such Transition employees that have resigned or are not available to Buyer as intended here.

6.17 Website, Referrals. Seller shall retain web domain www.pgt.com, and starting within two days after the Closing Seller’s web page will provide a large, conspicuous first-page link to Buyer’s website for all Microanalysis product information, sales and service contacts for 2 years after the Closing. Seller will make arrangements for mail, e-mail and telephone calls related to the Microanalysis business to be forwarded promptly to the appropriate contacts at Buyer, starting immediately after Closing.

6.18 Supply Agreement. *** The parties shall reach agreement upon all of the terms and conditions of the Supply Agreement no later than 5:00 p.m. Eastern Time on October 28, 2005 through the exercise of the following efforts:

(i) Counsel for Buyer and Seller shall each be instructed to proceed in good faith and use their respective best efforts to reach agreement on any legal or contractual issues no later than 5:00 p.m. Eastern Time on October 24, 2005.

(ii) Buyer and Seller shall utilize their respective best efforts to negotiate in good faith any business or related terms of the Supply Agreement and agree thereon no later than 5:00 p.m. Eastern Time on October 27, 2005.

(iii) No later than 5:00 p.m. Eastern Time on October 28, 2005, the agreed form of the Supply Agreement shall be attached to this Agreement as Schedule 6.18.

7.0 CONDITIONS TO THE CLOSING

7.1 Each Party. The respective obligations of the parties to effect the transactions contemplated hereby shall be subject to the satisfaction, at or prior to the Closing, of the following conditions:

(a) No Order. No Governmental Entity shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, executive order, decree, injunction or other order (whether temporary, preliminary or permanent) which is in effect and which has

[ ***] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.

the effect of making the transactions contemplated hereby illegal or otherwise prohibiting the consummation of the transactions contemplated hereby.

(b) No Injunctions. No temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the transactions contemplated hereby shall be in effect, nor shall any proceeding brought by a Governmental Entity be seeking any of the foregoing be pending.

7.2 Buyer. The obligation of Buyer to effect the transactions contemplated hereby shall be subject to the satisfaction at or prior to the Closing of each of the following conditions, any of which may be waived, in writing, exclusively by Buyer:

(a) Representations and Covenants. (i) The representations and warranties of Seller, PGT-UK and Principal Stockholders in this Agreement were true and correct on the date they were made and shall be true and correct on and as of the Closing Date as though such representations and warranties were made on and as of such time, and (ii) Seller, PGT-UK and Principal Stockholders shall have performed and complied with all covenants and obligations under this Agreement required to be performed and complied with by Seller, PGT-UK or Principal Stockholders as of the Closing.

(b) Stockholder Approval. This Agreement shall have been approved and adopted, and the transactions contemplated by this Agreement and the other Transaction Documents shall have been duly approved, by the requisite vote under applicable law, by the stockholders of Seller and PGT-UK.

(c) Governmental Approval. Approvals from any court, administrative agency, commission, or other federal, state, county, local or foreign governmental authority, instrumentality, agency or commission (if any) deemed appropriate or necessary by Buyer shall have been timely obtained, it being understood that a filing under the New Jersey Industrial Site Recovery Act will be made as soon as possible but that approval or waiver is to be obtained after the Closing

(d) Litigation. There shall be no Action or Proceeding of any nature pending or threatened against (i) Seller or PGT-UK, their properties or any of their officers or directors or Principal Stockholders arising out of, or in any way connected with, the transactions contemplated hereby, or (ii) the Business, the Products, or the Acquired Assets.

(e) Third Party Consents. Buyer shall have received from Seller all material consents, waivers, approvals, licenses and assignments for all Transferred Contracts.

(f) Release of Liens. Buyer shall have received from Seller at Closing and upon payment of all outstanding loans, a duly and validly executed copy of all agreements, instruments, certificates and other documents, in form and substance reasonably satisfactory to

Buyer, that are necessary or appropriate to evidence the release of all Liens set forth in Schedule 4.9 to this Agreement.

(g) Investigation. Buyer shall have completed its due diligence investigation of Seller and PGT-UK, with results reasonably satisfactory to Buyer, provided that Buyer may not express dissatisfaction with any matters disclosed in the Schedules to this Agreement..

(h) Opinion. Buyer shall have received a satisfactory opinion from legal counsel to Seller in the form attached as Schedule 7.2(h).

(i) No Material Adverse Effect. There shall not have occurred any event or condition of any character (including, without limitation, any bankruptcy or similar legal or equitable proceeding) that has had or is reasonably likely to have a Material Adverse Effect on Seller, PGT-UK, Principal Stockholders, the Business or the Acquired Assets since the date of this Agreement.

(j) New Employment Arrangements. Buyer shall have been able to hire, at compensation which is the same as their current compensation from Seller without any requirement to relocate and pursuant to employment conditions and benefits which are standard at Buyer, the current employees of Seller and PGT-UK associated with the Business listed in Schedule 2.8(d). This Section 7.2(j) shall be deemed to have been met as long as Buyer has been able to hire in such manner at least 3 out of 4 U.S. Field Sales staff, and at least 2 out of 3 U.S. Field Service staff listed on Schedule 2.8(d), it being understood that Buyer shall exercise its best commercial efforts, consistent with the remainder of this Section 7.2(j), to hire such employees.

(k) Certificates. Buyer shall have received certificates, validly executed by the Chief Executive Officer of Seller and PGT-UK for and on their behalf, and by Principal Stockholders for and on their behalf, to the effect that, as of the Closing:

(i) all representations and warranties made by Seller, PGT-UK and Principal Stockholders in this Agreement were true and correct when made and are true and correct on and as of the Closing Date as though such representations and warranties were made on and as of such time;

(ii) all covenants and obligations under this Agreement to be performed by Seller, PGT-UK or Principal Stockholders on or before the Closing have been so performed; and

(iii) the conditions to the obligations of Buyer set forth in this Section 7.2 have been satisfied (unless otherwise waived in accordance with the terms hereof).

(l) Certificate of Secretary. Buyer shall have received a certificate, validly executed by the Secretary of Seller, certifying as to (i) the terms and effectiveness of the certificate of incorporation and the bylaws of Seller, (ii) the valid adoption of resolutions of the Board of Directors of Seller approving this Agreement and the consummation of the transactions contemplated hereby, and (iii) the valid receipt of approval by the stockholders of Seller of the transactions contemplated by this Agreement and the other Transaction Documents.

(m) Deliveries. Seller shall have delivered to Buyer executed copies of the Transaction Documents and shall have delivered, transferred or assigned all of the Acquired Assets as set forth in Section 2.0 hereof.

(n) Proration. All taxes or other fees or payments arising in connection with the Acquired Assets shall have been prorated at the Closing.

(o) Good Standing. Seller shall have furnished Buyer certificates issued by the Secretary of State of New Jersey with respect to the valid existence, corporate good standing and tax good standing of Seller.

7.3 Seller, PGT-UK and Principal Stockholders. The obligations of Seller and Principal Stockholders to consummate and effect the transactions contemplated hereby shall be subject to the satisfaction at or prior to the Closing of each of the following conditions, any of which may be waived, in writing, exclusively by Seller and Principal Stockholders:

(a) Representations and Covenants. (i) The representations and warranties of Buyer in this Agreement were true and correct when made and shall be true and correct on and as of the Closing Date as though such representations and warranties were made on and as of such time, and (ii) Buyer shall have performed and complied with all covenants and obligations under this Agreement required to be performed and complied with by Buyer as of the Closing.

(b) Certificate of Buyer. Seller, PGT-UK and Principal Stockholders shall have received a certificate, validly executed by the Chief Executive Officer of Buyer, to the effect that, as of the Closing:

(i) all representations and warranties made by Buyer in this Agreement were true and correct when made and are true and correct on and as of the Closing Date as though such representations and warranties were made on and as of such time;

(ii) all covenants and obligations under this Agreement to be performed by Buyer on or before the Closing have been so performed; and

(iii) the conditions to the obligations of Seller, PGT-UK and Principal Stockholders set forth in this Section 7.3 have been satisfied (unless otherwise waived in accordance with the terms hereof).

(c) Certificate of Secretary. Seller, PGT-UK and Principal Stockholders shall have received a certificate, validly executed by the Secretary of Buyer, certifying as to (i) the terms and effectiveness of the certificate of incorporation and the bylaws of Buyer, and (ii) the valid adoption of resolutions of the Board of Directors of Buyer approving this Agreement and the consummation of the transactions contemplated hereby.

(d) Deliveries. Buyer shall have delivered to Seller, PGT-UK and Principal Stockholders executed copies of the Transaction Documents.

(e) Litigation. There shall be no Action or Proceeding of any nature pending or threatened against (i) Seller or PGT-UK, their properties or any of their officers or directors or

Principal Stockholders arising out of, or in any way connected with, the transactions contemplated hereby, or (ii) the Business, the Products, or the Acquired Assets.

8.0 SURVIVAL AND INDEMNIFICATION

8.1 Survival. The representations, warranties and covenants of the parties contained in this Agreement, or in any certificate or other instrument delivered pursuant to this Agreement, shall terminate on the first (1st) anniversary of the Closing Date, except with respect to (A) any Excluded Liabilities, (B) fraud or fraudulent misrepresentations with respect to representations and warranties of Seller, PGT-UK or Principal Stockholders contained in this Agreement, (C) knowing, intentional or willful breaches by either Seller or Principal Stockholders of its covenants contained in this Agreement, (D) Taxes referred to in Section 3.4, and (E) representations and warranties related to Tax Matters (Section 4.13) or Environmental Matters (Section 4.24) which shall survive without limitation subject to applicable statute of limitations periods.

8.2 Indemnification. Seller, PGT-UK and Principal Stockholders jointly and severally shall indemnify and hold Buyer and its officers, directors, employees, affiliates and agents (the “Indemnified Parties”), harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation and defense (hereinafter individually a “Loss” and collectively “Losses”) incurred or sustained by the Indemnified Parties, or any of them, directly or indirectly, as a result of: (i) any breach or inaccuracy of a representation or warranty of Seller or Principal Stockholders contained in this Agreement or in any certificate, instrument or other document delivered pursuant to this Agreement, (ii) any failure by Seller, PGT-UK or Principal Stockholders to perform or comply with any covenant applicable to it contained in this Agreement, (iii) any Excluded Liabilities, including, without limitation, any liabilities arising from or relating to Seller’s, PGT-UK’s or Principal Stockholders’ operations prior to Closing, or (iv) any liabilities or obligations arising from or relating to Seller’s, PGT-UK’s or Principal Stockholders’ (or any of their officers, directors, employees, agents or independent contractors) operations, acts or omissions after Closing.

8.3 Procedure. For the purposes hereof, “Officer’s Certificate” shall mean a certificate signed by any officer the Indemnified Party (a) stating that the Indemnified Party has paid, sustained, incurred, or properly accrued, or reasonably anticipates that it will have to pay, sustain, incur, or accrue Losses, and (b) specifying in reasonable detail the individual items of Losses included in the amount so stated, the date each such item was paid, sustained, incurred, or properly accrued, or the basis for such anticipated liability, and the nature of the misrepresentation, breach of warranty or covenant or Excluded Liability to which such item is related. An Indemnified Party seeking indemnification shall deliver an Officer’s Certificate to the party from whom indemnification is sought (the “Indemnifying Party”). An Indemnifying Party may object to such claim by written notice to such Indemnified Party specifying the basis for the Indemnifying Party’s objection, within ten (10) days following receipt by the Indemnifying Party of notice from such Indemnified Party regarding such claim. If no objection is made, the Indemnifying Party shall promptly pay the claim.

8.4 Third-Party Claims. In the event Buyer becomes aware of a third-party claim which Buyer reasonably believes may result in a demand for indemnification pursuant to this Section 8.0, Buyer shall notify Seller and Principal Stockholders of such claim, and Seller and Principal Stockholders shall be entitled, at their expense, to participate in, but not to determine or conduct, the defense of such claim. Buyer shall have the right in its sole discretion to conduct the defense of and settle any such claim; provided, however, that except with the consent of Seller and Principal Stockholders, no settlement of any such claim with third-party claimants shall be determinative of the amount of Losses relating to such matter. In the event that Seller and Principal Stockholders have consented to any such settlement, neither Seller nor Principal Stockholders shall have any power or authority to object under any provision of this Section 8.0 to the amount of any claim by Buyer against Seller and Principal Stockholders with respect to such settlement.

8.5 Remedy. Except with respect to (A) any Excluded Liabilities, (B) fraud or fraudulent misrepresentation with respect to representations and warranties of either Seller or Principal Stockholders contained in this Agreement, (C) knowing, intentional or willful breaches by Seller, PGT-UK or Principal Stockholders of its covenants contained in this Agreement, (D) Taxes referred to in Section 3.4, and (E) any representations and warranties contained in Section 4.0 related to Tax Matters (Section 4.13) or Environmental Matters (Section 4.24), the maximum amount an Indemnified Party may recover from Seller, PGT-UK and Principal Stockholders pursuant to the indemnity set forth in Section 8.2 for Losses shall be limited to Three Hundred Thousand Dollars ($300,000), and shall first be subtracted from the payment in Section 3.2(c), unless this amount has been released from escrow already.

9.0 TERMINATION, AMENDMENT AND WAIVER

9.1 Termination. Except as provided in Section 9.2, this Agreement may be terminated and the transactions contemplated hereby abandoned at any time prior to the Closing whether before or after the requisite approval of the stockholders of Seller:

(a) by mutual written consent duly authorized by Buyer and Seller;

(b) by either Seller or Buyer if the Closing Date shall not have occurred by November 15, 2005 (the “End Date”) for any reason; provided, however, that the right to terminate this Agreement under this Section 9.1(b) shall not be available to any party whose action or failure to act has been a principal cause of or resulted in the failure of the Closing Date to occur on or before the End Date and such action or failure to act constitutes a material breach of this Agreement;

(c) by either Seller or Buyer if a Governmental Entity shall have issued an order, decree or ruling or taken any other action, in any case having the effect of permanently restraining, enjoining or otherwise prohibiting the transactions contemplated hereby, which order, decree, ruling or other action is final and nonappealable;

(d) by Buyer if the required approval of the stockholders of Seller contemplated by this Agreement shall not have been obtained by reason of the failure to obtain the required vote;

(e) by Buyer, upon a breach of any representation, warranty, covenant or agreement on the part of Seller, PGT-UK or Principal Stockholders set forth in this Agreement, or if any representation or warranty of Seller, PGT-UK or Principal Stockholders shall have become untrue, in either case such that the conditions set forth in Section 7.2(a) would not be satisfied as of the time of such breach or as of the time such representation or warranty shall have become untrue, provided, that if such inaccuracy in Seller’s, PGT-UK’s or Principal Stockholders’ representations and warranties or breach by Seller, PGT-UK or Principal Stockholders is curable by Seller, PGT-UK or Principal Stockholders through the exercise of its commercially reasonable efforts, then Buyer may not terminate this Agreement under this Section 9.1(e) prior to the End Date, provided Seller, PGT-UK and Principal Stockholders, as applicable, continue to exercise commercially reasonable efforts to cure such breach (it being understood that Buyer may not terminate this Agreement pursuant to this Section 9.1(e) if it shall have materially breached this Agreement or if such breach by Seller, PGT-UK or Principal Stockholders is cured prior to the End Date); or

(f) by Seller, PGT-UK or Principal Stockholders, upon a breach of any representation, warranty, covenant or agreement on the part of Buyer set forth in this Agreement, or if any representation or warranty of Buyer shall have become untrue, in either case such that the conditions set forth in Section 7.3(a) would not be satisfied as of the time of such breach or as of the time such representation or warranty shall have become untrue, provided, that if such inaccuracy in Buyer’s representations and warranties or breach by Buyer is curable by Buyer through the exercise of its commercially reasonable efforts, then neither Seller, PGT-UK nor Principal Stockholders may terminate this Agreement under this Section 9.1(f) prior to the End Date, provided Buyer continues to exercise commercially reasonable efforts to cure such breach (it being understood that neither Seller, PGT-UK nor Principal Stockholders may terminate this Agreement pursuant to this Section 9.1(f) if it shall have materially breached this Agreement or if such breach by Buyer is cured prior to the End Date).

9.2 Effect. In the event of termination of this Agreement as provided in Section 9.1, this Agreement shall forthwith become void and there shall be no liability or obligation on the part of any party hereto, or its affiliates, officers, directors or stockholders, provided that each party shall remain liable for any breaches of this Agreement prior to its termination; and provided further that, the provisions of Section 6.4, Section 6.10, Section 10.0 and this Section 9.2 shall remain in full force and effect and survive any termination of this Agreement. Notwithstanding the foregoing, nothing contained herein shall relieve any party from liability for any breach hereof.

9.3 Amendment. This Agreement may be amended by the parties hereto at any time by execution of an instrument in writing signed on behalf of each of the parties hereto.

9.4 Extension. At any time prior to the Closing, Buyer, on the one hand, and Seller, PGT-UK or Principal Stockholders, on the other hand, may, to the extent legally allowed, (i) extend the time for the performance of any of the obligations of the other party hereto,

(ii) waive any inaccuracies in the representations and warranties made to such parties contained herein or in any document delivered pursuant hereto, and (iii) waive compliance with any of the agreements or conditions for the benefit of such parties contained herein. Any agreement on the part of a party hereto to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party.

10.0 GENERAL

10.1 Notices. All notices and other communications hereunder shall be in writing and shall be deemed given if delivered personally or by commercial messenger or courier service, or mailed by registered or certified mail (return receipt requested) or sent via facsimile (with acknowledgment of complete transmission) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice); provided, however, that notices sent by mail will not be deemed given until received:


(a)	if to Buyer, to:	Bruker AXS Inc.
		c/o Frank H. Laukien, Ph.D.
		40 Manning Road
		Billerica, MA 01821
		Facsimile No.: (978) 667-2917

	with a copy to:	Nixon Peabody LLP
		100 Summer Street
		Boston, Massachusetts 02110
		Attention: Richard M. Stein
		Facsimile No.: (866) 382-6139

(b)	if to Seller or PGT-UK, to:	Princeton Gamma-Tech Instruments, Inc.
		1026 Route 518
		Rocky Hill, NJ 08553
		Attn: President
		Facsimile No.:

	with a copy to:	MillerMitchell PC
		134 Nassau Street
		Princeton, NJ 08542
		Attention: Richard M. Miller
		Facsimile No.: (609) 921-3322

(c)	if to Principal Stockholders, to:	Mr. Juhani Taskinen
		Finn-Partners, Inc.
		36 Lyndhurst
		Newport Beach, California 92666
		Facsimile No.:

	with a copy to:	MillerMitchell PC
		134 Nassau Street
		Princeton, NJ 08542
		Attention: Richard M. Miller
		Facsimile No.: (609) 921-3322

10.2 Entire Agreement. The Transaction Documents, the Exhibits, the Disclosure Schedule, the Non-Disclosure Agreement and the documents and instruments and other agreements among the parties hereto referenced herein (i) constitute the entire agreement among the parties with respect to the subject matter hereof and supersede all prior agreements and understandings both written and oral, among the parties with respect to the subject matter hereof; (ii) are not intended to confer upon any other person any rights or remedies hereunder; and (iii) shall not be assigned by operation of law or otherwise, except that Buyer may assign its rights and delegate its obligations hereunder to any affiliates as long as Buyer remains ultimately liable for all of its obligations hereunder.

10.3 Severability. In the event that any provision of this Agreement, or the application thereof, becomes or is declared by a court of competent jurisdiction to be illegal, void or unenforceable, the remainder of this Agreement will continue in full force and effect and the application of such provision to other persons or circumstances will be interpreted so as reasonably to effect the intent of the parties hereto. The parties will replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of such void or unenforceable provision.

10.4 Other Remedies. Any and all remedies herein expressly conferred upon a party will be deemed cumulative with and not exclusive of any other remedy conferred hereby, or by law or equity upon such party, and the exercise by a party of any one remedy will not preclude the exercise of any other remedy.

10.5 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS THEREOF.

10.6 Jurisdiction. Except as otherwise provided herein, each of the parties hereto irrevocably consents to the exclusive jurisdiction and venue of any court within the State of Delaware in connection with any matter based upon or arising out of this Agreement or the matters contemplated herein, agrees that process may be served upon them in any manner authorized by the laws of the State of Delaware for such persons and waives and covenants not to assert or plead any objection which they might otherwise have to such jurisdiction, venue and such process.

10.7 Construction. The parties have been represented by counsel during the negotiation and execution of this Agreement and, therefor, waive the application of any law,

regulation, holding or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document.

10.8 Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY AND ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF ANY PARTY HERETO IN NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.

10.9 Expenses. Whether or not the transactions contemplated herein are consummated, all expenses, including, without limitation, all legal, accounting, financial advisory, consulting and other fees, incurred in connection with the negotiation or effectuation of this Agreement or consummation of such transactions, shall be the obligation of the respective party incurring such expenses.

10.10 Counterparts. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other party, it being understood that all parties need not sign the same counterpart.

* * *

IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto as of the date first above written.

	BRUKER AXS INC.
	By:	/s/ Frank H. Laukien, Ph.D.
	Title:	President

	PRINCETON GAMMA-TECH INSTRUMENTS, INC.

	By:	/s/ C. E. Cox
	Title:	President
	FINN-PARTNERS, INC.

	By:	/s/ Juhani Taskinen
	Title:	President
	THIRD LETTER CORPORATION

	By:	/s/ David Brown
	Title:	President
	PRINCETON GAMMA TECH (UK), LTD.

	By:	/s/ C. E. Cox
	Title:	Director

EX-31.1 4 a05-18563_1ex31d1.htm 302 CERTIFICATION

Exhibit 31.1

CERTIFICATION

I, Frank H. Laukien, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Bruker BioSciences Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2005	By:
		/s/ Frank H. Laukien
		Frank H. Laukien
		President and Chief Executive Officer (Principal Executive Officer)

EX-31.2 5 a05-18563_1ex31d2.htm 302 CERTIFICATION

Exhibit 31.2

CERTIFICATION

I, William J. Knight, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Bruker BioSciences Corporation;

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2005	By:
		/s/ William J. Knight
		William J. Knight
		Chief Financial Officer (Principal Financial and Accounting Officer)

EX-32.1 6 a05-18563_1ex32d1.htm 906 CERTIFICATION

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Bruker BioSciences Corporation (the “Company”) on Form 10-Q for the three months ended September 30, 2005 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Frank H. Laukien, as President, Chief Executive Officer and Chairman of the Board of Directors of the Company, and William J. Knight, as Chief Financial Officer of the Company, certifies, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that to the best of their knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition of the Company.

		/s/ Frank H. Laukien, Ph.D.
Date: November 9, 2005	By:	Frank H. Laukien, Ph.D.
		President, Chief Executive Officer, and Chairman


		/s/ William J. Knight
Date: November 9, 2005	By:	William J. Knight
		Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to Bruker BioSciences Corporation and will be retained by Bruker BioSciences Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

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FOR THE TRANSITION PERIOD FROM TO

TABLE OF CONTENTS

LIST OF DEFINITIONS

LIST OF EXHIBITS

PREAMBLE

§ 1 COMPANY DETAILS

1.1

Company Details

1.2

Share Capital of RÖNTEC AG

1.3

Effective Transfer Date

§ 2 SALE OF SHARES; ENTITLEMENT TO DIVIDENDS

2.1

Sale of Shares

2.2

Transfer; Consents

§ 3 PURCHASE PRICE; PAYMENT METHOD

3.1

Base Purchase Price

3.2

Adjustment of the Purchase Price

3.3

Due Date, Allocation and Payment of the Purchase Price

§ 4 PURCHASE PRICE INCREASE

4.1

Supplemental Purchase Price 2006

4.2

Supplemental Purchase Price 2007

4.3

Determination of the Relevant Turnover

4.4

Due Date, Payment and Adjustment of the Supplemental Purchase Prices

4.5

Loss of Claim for Payment of a Supplemental Purchase Price

§ 5 INDEPENDENT GUARANTEES OF THE SELLERS

5.1

Form and Scope of the Guarantees by the Sellers

5.2

Ownership of the Shares

5.3

Company Law Situation

5.4

Participations

5.5

Inter-company Agreements

5.6

No Insolvency Proceedings

5.7

Annual Financial Statements

5.8

Contingent Liabilities

5.9

Futures Transactions / Options

5.10

Loan Agreements / Liabilities owed to Banks

5.11

Security / Liability for Obligations of Third Parties

5.12

Assets

5.13

Intellectual Property Rights

5.14

Company Name

5.15

Lease and Similar Agreements

5.16

Procurement

5.17

Service Agreements

5.18

Consulting Agreements

5.19

Distribution Agreements

5.20

Personnel

5.21

Continuation of Material Agreements

5.22

Customer Relations

§ 1
COMPANY DETAILS

§ 2
SALE OF SHARES; ENTITLEMENT TO DIVIDENDS

§ 3
PURCHASE PRICE; PAYMENT METHOD

§ 4
PURCHASE PRICE INCREASE

§ 5
INDEPENDENT GUARANTEES OF THE SELLERS

§ 7
TAX WARRANTIES AND INDEMNIFICATION

§ 8
DISCHARGE OF RÖNTEC AG’S LIABILITIES

§ 9
INDEMNIFICATIONS AND COVENANTS OF THE SELLERS