10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20004

Form 10-K

(Mark One)
þ	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended December 31, 2005
or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from           to

Commission file number 000-23092

NATIONAL DENTEX CORPORATION

(Exact name of registrant as specified in its charter)

MASSACHUSETTS	04-2762050
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
526 Boston Post Road, Wayland, MA (Address of Principal Executive Offices)	01778 (Zip Code)

(508) 358-4422

(Registrant’s Telephone No., including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, par value $.01 per share

(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes o     No þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes o     No þ

Indicate by check mark 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.  Yes þ     No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  þ

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act (Check one).

Large accelerated filer o     Accelerated filer þ     Non-accelerated filer o

Indicate by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act.  Yes o     No þ

As of June 30, 2005, the aggregate market value of the 5,326,415 outstanding shares of voting stock held by non-affiliates of the registrant was $95,299,519, based upon the last reported sale of the Common Stock on the Nasdaq National Market on such date.

As of March 7, 2006, 5,434,188 shares of the registrant’s Common Stock, par value $.01 per share, were issued and outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the proxy statement for the annual stockholders’ meeting scheduled to be held on May 16, 2006 which we plan to file with the SEC on or about March 27, 2006, but in no event later than 120 days after the end of our fiscal year ended December 31, 2005, are incorporated by reference into Part III.

TABLE OF CONTENTS

PART I
	Item 1. Business
	Item 1A. Risk Factors
	Item 1B. Unresolved Staff Comments
	Item 2. Properties
	Item 3. Legal Proceedings
	Item 4. Submission of Matters to a Vote of Security Holders
PART II
	Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
	Item 6. Selected Financial Data
	Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Item 7A. Quantitative and Qualitative Disclosures about Market Risk
	Item 8. Financial Statements and Supplementary Data
	Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
	Item 9A. Controls and Procedures
	Item 9B. Other Information
PART III
	Item 10. Directors and Executive Officers of the Registrant
	Item 11. Executive Compensation
	Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters
	Item 13. Certain Relationships and Related Transactions
	Item 14. Principal Accountant Fees and Services
PART IV
	Item 15. Exhibits and Financial Statement Schedules
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
SIGNATURES
EXHIBIT INDEX
EX-10.9 Laboratory Incentive Compensation Plan
EX-10.10 2006 Key Employee and Corporate Support Group Incentive Compensation Plan
EX-10.11 Employees' Stock Purchase Plan
EX-10.13 Supplemental Executive Retirement Plan
EX-10.14 Supplemental Laboratory Executive Retirement Plan
EX-21 Subsidiaries of the Company
EX-23 Consent of PricewaterhouseCoopers LLP
EX-31.1 Section 302 Certification of CEO
EX-31.2 Section 302 Certification of CFO
EX-32.1 Section 906 Certification of CEO
EX-32.2 Section 906 Certification of CFO

PART I

Item 1.   Business

General

We were founded in 1982 as H&M Laboratories Services, Inc., a Massachusetts corporation, which acquired six full-service dental laboratories and related branch laboratories from Healthco, Inc. In 1983, we changed our name to National Dentex Corporation and acquired 20 additional full-service dental laboratories and related branch laboratories from Lifemark Corporation. Our acquisition strategy is to consolidate our position within the dental laboratory industry and use our financial and operational synergies to create a competitive advantage. Over the last five years we have acquired the following stand-alone laboratory facilities: in 2001, Creative Dental Ceramics, Bauer Dental Studio, Aronovitch Dental, Crown Dental Studio and The Freeman Center; in 2002, Fox Dental and E&S Dental; in 2003, Salem Dental, Top Quality Partials, Midtown Dental and Thoele Dental; in 2004, D.H. Baker Dental; and, in 2005 Wornson-Polzin Dental Laboratory and Green Dental Laboratories. Over the past five years, we have also acquired various smaller laboratories and consolidated them into existing operations.

We currently own and operate 45 dental laboratories, consisting of 41 full-service dental laboratories and four branch laboratories located in 30 states throughout the United States. Our dental laboratories custom design and fabricate dentures, crowns and fixed bridges, and other dental prosthetic appliances. Each dental laboratory operates under its own business name. Our principal executive offices are located at 526 Boston Post Road, Wayland, MA 01778, telephone number (508) 358-4422. Our corporate web site is located at www.nationaldentex.com. We make available free of charge through our website our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to these reports filed or furnished pursuant to Section 13(a) of the Securities Exchange Act of 1934 as soon as practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission.

Information as to Industry and Operating Segments

Our business consists of only one industry segment, which is the design, fabrication, marketing and sale of custom dental prosthetic appliances for and to dentists. We report on two operating segments within this single industry segment.

Description of Business

Our dental laboratories design and fabricate custom dental prosthetic appliances such as dentures, crowns and bridges. These products are produced by trained technicians working in dental laboratories in accordance with work orders and cases (consisting of impressions, models and occlusal registrations of a patient’s teeth) provided by the dentist. Dentists are the direct purchasers of our products.

Our products are grouped into the following three main categories:

Restorative Products.  Restorative products that our dental laboratories sell consist primarily of crowns and bridges. A crown replaces the part of a tooth that is visible, and is usually made of gold or porcelain. A bridge is a restoration of one or more missing teeth that is permanently attached to the natural teeth or roots. In addition to the traditional crown, we also make porcelain jackets, which are crowns constructed entirely of porcelain; onlays, which are partial crowns which do not cover all of the visible tooth; and precision crowns, which are restorations designed to receive and connect a removable partial denture. We also make inlays, which are restorations made to fit a prepared tooth cavity and then cemented into place.

Reconstructive Products.  Reconstructive products sold by our dental laboratories consist primarily of partial dentures and full dentures. Partial dentures are removable dental prostheses that replace missing teeth and associated structures. Full dentures are dental prostheses that substitute for the total loss of teeth and associated structures. We also sell precision attachments, which connect a crown and an artificial prosthesis, and implants, which are fixtures anchored securely in the bone of the mouth to which a crown, partial or full denture is secured by means of screws or clips.

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Cosmetic Products.  Cosmetic products sold by our dental laboratories consist primarily of porcelain veneers and ceramic crowns. Porcelain veneers are thin coverings of porcelain cemented to the front of a tooth to enhance personal appearance. Ceramic crowns are crowns made from ceramic materials that most closely replicate natural teeth. We also sell composite inlays and onlays, which replace silver fillings for a more natural appearance, and orthodontic appliances, which are products fabricated to move existing teeth to enhance function and appearance.

Laboratory and Corporate Operations

Our full-service dental laboratories design and fabricate a full range of custom-made dental prosthetic appliances. These custom products are manufactured from raw materials, such as high noble, noble and predominantly base alloys, dental resins, composites and porcelain. There are different production processes for the various types of prosthetic appliances depending upon the product and the materials used in the type of appliance being fabricated, each of which requires different skills and levels of training. Our dental laboratories perform numerous quality control checks throughout the production cycle to improve the quality of our products and to make certain the design and appearance satisfy the needs of the dentist and the patient. Our branch dental laboratories are smaller in size and offer a limited number of products. When a branch receives an order that it cannot fill, the branch refers the order to one of our affiliated full-service dental laboratories.

We operate each of our dental laboratories as a stand-alone facility under the direction of a local manager responsible for operation of the dental laboratory, supervision of its technical and sales staff and delivery of quality products and services. Each of our dental laboratories markets and sells its products through its own direct sales force, supported by regional managers and company-wide marketing programs. Employees at each dental laboratory have a direct stake in the financial success of the dental laboratory through participation in our cash and stock incentive plans.

Our corporate management provides our overall strategy, direction and financial management and negotiates all acquisitions. Corporate personnel also support the operations of our dental laboratories by performing functions that are not directly related to the production and sale of dental laboratory products, such as processing payroll and related benefit programs, obtaining insurance and procuring financing. Our corporate management provides marketing, financial and administrative services, negotiates national purchasing arrangements, and sets quality and performance standards for our dental laboratories. Finally, our corporate management includes industry recognized technical experts who guide and direct our investments in new technology and materials.

Sales and Marketing

The majority of our local dental laboratories market and sell their products through their own direct sales force. The sales force interacts with dentists within its market area, primarily through visits to dentists’ offices, to introduce the dental laboratory’s services and products offered, and to promote new products and techniques that can assist dentists in expanding their practices. Our customer-focused marketing and sales program, entitled the “NDX Reliance Program ^tm” is specifically designed to make choosing a dental laboratory an easier decision for dentists. Its five components — Practice Support, Laboratory Systems, Quality Assurance, Reliance Restorations and a Continuing Education Series — differentiate our qualified laboratories from their many competitors. We believe that this unique approach to assist the dentist and his or her staff to improve chairtime efficiencies while providing exceptional service, superior quality and quick and timely product delivery will enhance our ability to expand our base of business by establishing lasting professional relationships with our customers. Our laboratories currently employ a total of 42 sales representatives. In addition, our dental laboratories, alone or with local dental societies, dental schools or study clubs, sponsor technical training clinics for dentists and their staffs on topics such as advanced clinical techniques. The local dental laboratories also exhibit at state and local dental conventions.

Competition

The dental laboratory industry is highly competitive and fragmented. A typical dental laboratory’s business originates from dentists located within 50 miles of the dental laboratory. We believe there are currently approximately 12,000 dental laboratories in the United States, ranging in size from one to approximately 200 technicians. We estimate that our sales presently represent less than 3% of the total sales of custom-made dental prosthetic

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appliances in the United States. Competition is primarily from other dental laboratories in the respective local market areas. The vast majority of dental laboratories consist of single business units, although we recognize that there are several other multiple-location operators including, the Sentage Corporation d/b/a Dental Services Group, Dental Technologies, Inc. and Americus Dental Labs, Inc. These groups compete with us in several market areas. We also face competition from various mail order dental laboratories, most notably Glidewell Laboratories.

The domestic industry faces growing competition as it begins to confront globalization. Competition for business is expected to intensify from the developing manufacturing capabilities of countries such as China, India, and others. In February 2006, Dentsply International, Inc. (“Dentsply”), one of the largest suppliers of raw materials to us and the worldwide dental laboratory industry, announced its intention to manufacture partial frames and traditional crowns in China for sale to United States based dental laboratories at prices reflecting significant labor cost differentials. Prior to this announcement, Dentsply did not seek to derive revenue from the sale and manufacture of dental restorations. We continue to evaluate the threats and opportunities arising from growing foreign competition and changing marketplaces to ensure we continue to provide those products and services required by our clients.

Most dentists use a limited number of dental laboratories. We believe they prefer and tend to rely on those laboratories which produce quality products delivered on a timely basis and which carry all of the products which the dentist may need, even if a particular item is a newer specialty product used only sporadically by the dentist. While price is one of the competitive factors in the dental laboratory industry, we believe that most dentists consider product quality and consistency, service, and breadth of product line to be equally important. We believe that we compete favorably with respect to all of these factors. We consider that our ability to produce quality products locally, to deliver such products on a timely basis, to provide convenience for the dentist through the breadth of our product line, and our sponsorship of educational clinics, provide a competitive advantage over other dental laboratories in the local markets in which our dental laboratories operate. Our ability to provide newer specialty products for implantology, adult orthodontics and cosmetic dentistry, which require highly skilled technicians, more extensive inventories, additional working capital, and investment in both training and capital equipment, also distinguishes us from the many other dental laboratories which do not have comparable resources to provide these products. While such specialty products presently represent less than 20% of our business, we believe that the ability to offer these products is essential for dental laboratories to remain competitive.

Employees

As of December 31, 2005, we had 1,873 employees, 1,830 of whom worked at individual laboratories. Corporate management and administrative staff totaled 43 people. None of our employees are covered by a collective bargaining agreement. Management considers our employee relations to be good.

Intellectual Property

Our general technological know-how, experience and workforce are important to the conduct of our business. Each of our dental laboratories operates under its own trade name, often for decades, and we consider these trade names to be materially important to the conduct of our business. Also important is the development and maintenance of customer relationships. The continued focus and investment in the “NDX Reliance Program^tm”, our national marketing program, is expected to continue to assist in the generation and maintenance of customer relationships and the goodwill of our dental laboratories. Finally, while we have several trademarks and licenses to use trademarks, we do not deem these to be material to the overall conduct of our business.

Backlog

Due to the individualized and customized nature of most dental products and a typical turnaround product cycle of less than seven days, there was no significant backlog of orders existing at December 31, 2005 and 2004.

Item 1A.  Risk Factors

Our business is subject to certain risks that could materially affect our financial condition, results of operations, and the value of our common stock. These risks include, but are not limited to, the ones described below. Additional

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risks and uncertainties that we are unaware of, or that we may currently deem immaterial, may become important factors that harm our business, financial condition, results of operations, or the value of our common stock.

Our success depends on economic and other external factors that affect consumer decisions about whether and when to have dental procedures performed.

Our business success depends in large measure on consumer decisions to have dental procedures performed. In this respect, demand for our products and our business results are sensitive to external factors that, directly or indirectly, affect consumer confidence, affect levels of disposable consumer income, or otherwise lead consumers to defer or elect not to have dental procedures performed. Examples of such external factors include the timing, duration and effects of adverse changes in overall economic conditions, including rates of job loss or growth, rising energy prices, and increases in medical and dental costs, nationally or regionally in the markets we serve. Increased governmental regulation of health care and trends in the dental industry towards managed care may also result in decreased consumer access to dental services and thereby adversely affect demand for our products and our sales and profitability. The precise impact of these external factors is difficult to predict in advance, but one or more of these factors could adversely affect our business to the extent they adversely affect consumer spending on dental procedures.

We operate in highly competitive and fragmented markets.

The dental laboratory industry is highly competitive and fragmented. We believe there are currently approximately 12,000 dental laboratories in the United States, ranging in size from one to approximately 200 technicians. We estimate that our sales presently represent less than 3% of the total sales of custom-made dental prosthetic appliances in the United States. Competition is primarily from other dental laboratories in the respective local market areas. The vast majority of dental laboratories consist of single business units, although there are several other multiple-location operators, including, the Sentage Corporation d/b/a Dental Services Group, Dental Technologies, Inc. and Americus Dental Labs, Inc. These groups compete with us in several market areas. We also face competition from various mail order dental laboratories, most notably Glidewell Laboratories. Our success thus depends on our ability to be competitive against many different competitors in each market area we serve. If we fail to anticipate evolving technological innovations and product offerings from our competitors and fail to offer products that appeal to the changing needs and preferences of our customers in the various markets we serve, demand for our products could decline and our operating results would be adversely affected. While the competitive importance of product quality, price, service and innovation varies from product to product, price is a factor, and we experience pricing pressures from competitors in our markets.

We face increased competitive pressures from larger competitors, foreign-sourced products and technology based solutions.

The industry in which we operate faces growing competition as it begins to confront globalization. We expect competition for business to intensify as United States based and foreign companies increasingly look at ways to benefit from the developing manufacturing capabilities of countries such as China, India, and others. For example, in February 2006, Dentsply International Inc. (“Dentsply”), one of the largest suppliers of raw materials to us and the worldwide dental laboratory industry, announced its intention to manufacture partial frames and traditional crowns in China for sale to United States based dental laboratories at prices reflecting significant labor cost differentials. Prior to this announcement, Dentsply did not seek to derive revenue from the sale and manufacture of dental restorations. Price pressures from such new sources of competition could erode our margins and cause our financial results of operations to suffer. Certain current technology solutions allow dentists to fabricate restorations without the use of a dental laboratory. Our success depends on our ability to evaluate and respond to the threats arising from growing foreign competition, changing marketplaces and new technology and our ability to identify ways in which we can competitively provide the products and services demanded by our customers.

Risks associated with our strategic acquisitions could adversely affect our business.

We have completed a number of acquisitions in recent years. Our acquisition strategy depends on our ability to identify laboratories that are suitable acquisition candidates, successfully negotiate and enter into transactions on

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acceptable terms, and our capacity to integrate and successfully operate newly acquired as well as our previously acquired laboratories. If we fail to locate suitable acquisition candidates, reach mistaken conclusions as to the suitability of laboratories as acquisition candidates, enter into transactions on terms that prove unfavorable to us, or fail to integrate new laboratories following an acquisition, our ability to operate and grow our business in the ways we would like could be materially and adversely effected. While we will continue to consider acquisitions as a means of enhancing shareowner value, acquisitions involve risks and uncertainties, including:

•  difficulties integrating the acquired company, retaining the acquired laboratories’ customers, and achieving the expected benefits of the acquisition, such as revenue increases, cost savings, and increases in geographic or product presence, in the desired time frames, if at all;

•  loss of key employees from the acquired company;

•  implementing and maintaining consistent standards, controls, procedures, policies and information systems; and

•  diversion of management’s attention from other business concerns.

Future acquisitions could cause us to incur additional debt, contingent liabilities, increased interest expense and higher amortization expense related to intangible assets, as well as experience dilution in earnings per share. Impairment losses on goodwill and intangible assets with an indefinite life, or restructuring charges, could also occur as a result of acquisitions.

If we fail to develop new or expand existing customer relationships, our ability to grow our business will be impaired.

Our growth depends on our ability to develop new customer relationships and to expand existing relationships with current customers. We cannot guarantee that new customers will be found, that any such new relationships will be successful when they are in place, or that business with current customers will increase. Failure to develop and expand such relationships could have a material adverse effect on our business, results of operations and financial condition.

Our failure to attract and retain qualified personnel would adversely affect our business.

Our success depends in part on the efforts and abilities of our senior management team and key employees, a number of which are approaching retirement age. Their skills, experience and industry contacts significantly benefit our operations and administration. The failure to attract, retain, and properly motivate the members of our senior management team and key employees, or to find suitable replacements for them in the event of death, ill health, or retirement, would have a negative effect on our operating results.

Our business results are adversely affected by increases in labor, benefits and related costs.

The costs of medical and others benefits have increased in recent years. The increased usage of medical benefits has intensified medical inflation in the United States. If such trends continue, then our business could be negatively affected. Changes in law that may increase the funding of, and the expense reflected for, employee benefits, would also adversely affect our financial results of operations, financial position, and competitiveness.

If we cannot continue to respond to technical innovations we may not be able to compete effectively.

We believe that our future success will depend, in part, upon our ability to continue to respond to technological innovations by the dental industry and introduce innovative design extensions for our existing products and to manufacture and market new products. We cannot assure you that we will be successful in the introduction, manufacturing and marketing of any new products or product innovations, or develop and introduce, in a timely manner, innovations to our existing products that satisfy our dentist customers’ needs or achieve market acceptance. Our failure to introduce new products successfully and in a timely manner, and at favorable margins, would harm our ability to successfully grow our business and could have a material adverse effect on our business, results of operations and financial condition.

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Our operating results can be adversely affected by changes in the cost or availability of raw materials, particularly precious metals like gold, platinum and palladium.

Pricing and availability of raw materials for use in our businesses — most especially precious metals, like gold, platinum and palladium which are components of many dental alloys — can be volatile due to numerous factors beyond our control, including domestic and international economic and geopolitical conditions, production levels, competition, consumer demand, and investor speculation. This volatility can significantly affect the availability and cost of raw materials for us, and may, therefore, have a material adverse effect on our business, results of operations and financial condition. During periods of rising prices of raw materials, there can be no assurance that we will be able to pass any portion of such increases on to customers. Prolonged higher metal costs may thus have a negative impact on gross profit percentages. Conversely, when raw material prices decline, customer demands for lower prices could result in lower sale prices and, to the extent we have existing inventory, lower margins. As a result, fluctuations in raw material prices could have a material adverse effect on our business, results of operations and financial condition.

Our failure to generate sufficient cash to meet our liquidity needs may affect our ability to service our indebtedness and grow our business.

Our ability to make payments on and to refinance our indebtedness, principally the amounts borrowed under our senior credit facility, and to fund planned capital expenditures and expansion efforts and strategic acquisitions we may make in the future, if any, will depend on our ability to generate cash in the future. This, to a certain extent, is subject to general economic, financial, competitive and other factors that are beyond our control.

Based on our current level of operations, we believe our cash flow from operations, together with available cash and available borrowings under our senior credit facility, will be adequate to meet future liquidity needs for at least the next twelve months. However, we cannot assure you that our business will generate sufficient cash flow from operations in the future, that our currently anticipated growth in revenues and cash flow will be realized on schedule or that future borrowings will be available to us under the senior credit facility in an amount sufficient to enable us to service indebtedness, undertake strategic acquisitions to grow our business, or to fund other liquidity needs. If we need to refinance all or a portion of our indebtedness, we cannot assure you that we will be able to do so on commercially reasonable terms or at all.

An impairment in the carrying value of goodwill or other acquired intangibles could negatively affect our operating results and net worth.

The carrying value of goodwill represents the fair value of acquired businesses in excess of identifiable assets and liabilities as of the acquisition date. The carrying value of other intangibles represents the fair value of trademarks, trade names and other acquired intangibles as of the acquisition date. Goodwill and other acquired intangibles expected to contribute indefinitely to our cash flows are not amortized, but must be evaluated by our management at least annually for impairment. If carrying value exceeds current undiscounted cash flows, an impairment is identified. The impairment is then measured based on the difference of fair value (discounted cash flow) and carrying value. Events and conditions that could result in impairment include changes in the industry in which we operate, as well as competition and advances in technology, or other factors leading to reduction in expected sales, profitability or cash flows. If the value of goodwill or other acquired intangibles is impaired, our earnings and net worth could be adversely affected.

Compliance with changing regulation of corporate governance, public disclosure, and accounting standards may result in additional expenses and risks.

Changing laws, regulations and standards relating to corporate governance, public disclosure and changes to accounting standards and practices, including the Sarbanes-Oxley Act of 2002, new Securities and Exchange Commission regulations and evolving rules applicable to publicly-traded companies on the Nasdaq National Market, are creating uncertainty, and hence risks, for companies such as ours. These new or changed laws, regulations and standards are subject to varying interpretations due to the fact that they are new and there is has not yet emerged a well-developed body of interpretation. As a result, their application in practice may evolve over time

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as new guidance is provided by regulatory and governing bodies. This development could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure, governance and accounting practices.

Our efforts to comply with evolving laws, regulations and standards have resulted in, and are likely to continue to result in, increased general and administrative expenses and an investment of management time and attention from revenue-generating activities to compliance activities. In particular, our efforts to comply with Section 404 of the Sarbanes-Oxley Act of 2002 and the related regulations regarding our required assessment of our internal controls over financial reporting and our external auditors’ audit of that assessment has required the commitment of significant financial and managerial resources. If our efforts to comply with new or changed laws, regulations and standards differ from the activities intended by regulatory or governing bodies, we could face many material and adverse consequences, including, a possible delisting of our common stock.

Forward Looking Statements

Certain statements in this Annual Report, particularly statements contained in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “anticipate”, “believe”, “estimate”, “expect”, “plan”, “intend” and other similar expressions are intended to identify these forward-looking statements, but are not the exclusive means of identifying them. Forward-looking statements included in this Annual Report or hereafter included in other publicly available documents filed with the Securities and Exchange Commission (“SEC”), reports to our stockholders and other publicly available statements issued or released by us involve known and unknown risks, uncertainties, and other factors which could cause our actual results, performance (financial or operating) or achievements to differ from the future results, performance (financial or operating) or achievements expressed or implied by such forward looking statements. Such future results are based upon our best estimates based upon current conditions and the most recent results of operations.

Various risks, uncertainties and contingencies could cause our actual results, performance or achievements to differ materially from those expressed in, or implied by, the forward-looking statements contained in this Annual Report. These include, but are not limited to, those listed above in this Item 1A, “Risk Factors.”

Item 1B.  Unresolved Staff Comments

Not applicable.

Item 2.   Properties

We currently lease a total of approximately 283,000 square feet of space. As of December 31, 2005, the future aggregate minimum rent payable for all of our leased real properties was approximately $14,108,000. We consider these properties to be modern, well maintained and suitable for our purposes and believe that our current facilities are adequate to meet our needs for the foreseeable future. We also believe that suitable substitute or replacement space is readily available at reasonable rental rates. Our principal executive and administrative offices occupy approximately 10,000 square feet of space in Wayland, Massachusetts. Our 37 leased dental laboratories range in size from 1,000 to 29,000 square feet and average approximately $70,000 in annual base rent.

As of December 31, 2005, we owned eight of our dental laboratory facilities at locations in Heber Springs, Arkansas; Denver, Colorado; Jacksonville, Florida; Metairie, Louisiana; Shreveport, Louisiana; Dallas, Texas; Houston, Texas; and Waukesha, Wisconsin. These locations total approximately 164,000 square feet and range in building size from 5,000 to 41,000 square feet. The facility in Heber Springs, Arkansas, comprising approximately

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40,000 square feet, was obtained in connection with our acquisition of Green Dental Laboratories, Inc. on March 1, 2005. A replacement facility for our Houston, Texas laboratory, comprising 41,000 square feet, was purchased in January, 2004 and placed in service in November, 2005. As of December 31, 2005, we held for sale our former Houston facility, comprising approximately 20,000 square feet. This facility was sold on March 15, 2006.

Item 3.   Legal Proceedings

We are involved from time to time in litigation incidental to our business. Our management believes that the outcome of current litigation will not have a material adverse effect upon our operations or financial condition and will not disrupt our normal operations.

In January 2005, we were served with a complaint naming us as a defendant in federal district court in a patent infringement case, PSN Illinois, LLC v. Ivoclar Vivadent, Inc. et al. The case was brought in the Eastern Division of the Northern District of Illinois. The complaint alleges that the various named defendants, including us and most other major domestic dental laboratories (and some companies that supply dental laboratories), infringed a patent that was assigned to the plaintiff by using, or inducing others to use, a process for making porcelain dental veneers. On March 7, 2005, we filed an answer with affirmative defenses to the complaint. While we are still in the process of further evaluating the plaintiff’s various allegations, we believe that the plaintiff can only seek monetary damages since the patent has expired, and we believe that we have meritorious defenses. In addition, one of our suppliers has agreed to defend and indemnify us against a portion of the plaintiff’s claims, should they be upheld.

Item 4.   Submission of Matters to a Vote of Security Holders

No matters were submitted to a vote of our security holders during the fourth quarter of fiscal 2005.

PART II

Item 5.   Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Trading Market

The Nasdaq National Market (“Nasdaq”) is the principal market for our common stock, where our shares are traded under the symbol “NADX”. Our common stock has been publicly traded since December 21, 1993.

The following table sets forth the range of high and low bid information for our common stock for each of the fiscal quarters of 2004 and 2005, adjusted for the three-for-two stock split in the form of a stock dividend on our common stock that was paid on December 31, 2004 to stockholders of record on December 20, 2004. The over-the-counter market quotations reflect inter-dealer prices, without retail markup, markdown or commission and may not necessarily represent actual transactions. The over-the-counter market quotations set forth below are based on information provided by the Nasdaq Stock Market, Inc.

	Price
Quarter Ending	Low Bid		High Bid
03/31/04	$	15.347	$	18.700
06/30/04	$	17.667	$	21.087
09/30/04	$	17.741	$	20.986
12/31/04	$	17.160	$	20.573
03/31/05	$	18.648	$	20.660
06/30/05	$	15.750	$	20.400
09/30/05	$	18.142	$	20.720
12/31/05	$	18.980	$	24.284

  Holders

The approximate number of record holders of our common stock as of March 7, 2006 was 473. The number of record owners was determined from our stockholder records, and does not include beneficial owners of our common stock whose shares are held in the names of various security holders, dealers and clearing agencies. We believe that

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the number of beneficial owners of our common stock held by others as or in nominee names is approximately 1,576 beneficial holders.

  Dividends

We have never paid a cash dividend on our shares of common stock and have no expectation of doing so for the foreseeable future. On December 31, 2004 we effected a three-for-two stock split in the form of a stock dividend on our common stock that was paid to stockholders of record on December 20, 2004.

  Recent Sales of Unregistered Securities

None.

  Purchases of Equity Securities by the Issuer and Affiliated Purchasers

In November 2002, we announced that our Board of Directors approved the repurchase by us of up to 300,000 shares of our common stock pursuant to a stock repurchase program. During the year ended December 31, 2005 we did not repurchase any shares of our common stock. The following table provides information about our repurchase activity during fiscal 2005 and the number of shares that may yet be purchased under our stock repurchase program.

Issuer Purchases of Equity Securities

						Maximum Number
				Total Number of		of Shares that
				Shares Purchased		May yet Be
	Total Number		Average	as Part of Publicly		Purchased Under
	of Shares		Price Paid	Announced Plans		the Plans or
Fiscal Period	Purchased		per Share	or Programs		Programs
January 1, 2005 - December 31, 2005		—	$ —		—		206,700

  Equity Compensation Plan Information

We maintain two stock incentive plans that were approved by our Board of Directors (the “Board”). In 1992, the Board and stockholders adopted the 1992 Long-Term Incentive Plan (“1992 LTIP”). Key employees, officers and directors were eligible to receive grants under the plan. Effective May 2002, no additional options may be granted under this plan. In January 2001, the Board adopted the 2001 Stock Plan (“2001 Plan”), which was approved by our stockholders in April 2001. Key employees, officers and directors are eligible to receive grants under the plan. Our Board of Directors approved an amendment to the 2001 Plan on January 17, 2006 to allow for the issuance of restricted stock and restricted stock units, subject to the approval of our shareholders at our annual meeting of stockholders scheduled to be held on May 16, 2006. In addition, we maintain an Employee Stock Purchase Plan (“ESPP”) that is qualified under Section 423 of the Internal Revenue Code.

For additional information, see Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholders” below. These plans are discussed in further detail in Note 9 of our Consolidated

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Financial Statements, which are furnished in connection with Item 8 of this Annual Report on Form 10-K and are attached immediately following Part IV below. Summary plan information as of December 31, 2005 is as follows:

	Number of Shares of
	National Dentex				Number of Shares of
	Corporation				National Dentex
	Common Stock to				Corporation
	Be Issued Upon		Weighted Average		Common Stock
	Exercise of		Exercise Price of		Remaining Available
	Outstanding Options		Outstanding Options		for Future Issuance
1992 LTIP		359,181	$	12.14		None
2001 Plan		358,925	$	14.52		399,450
ESPP		—		—		49,348
Total		718,106	$	13.33		448,798

Item 6.   Selected Financial Data

The following selected financial data for the five years ended December 31, 2005 are derived from our audited consolidated financial statements. The consolidated financial statements for fiscal 2001 were audited by Arthur Andersen LLP (“Andersen”) which has ceased operations. The data should be read in conjunction with the consolidated financial statements and the related notes included in this Report and in conjunction with Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

	2001			2002			2003			2004		2005
Consolidated Statements of Income:
Net sales	$	85,725		$	95,185		$	99,274		$	111,753	$	135,843
Cost of goods sold		50,278			56,196			59,534			66,953		78,381
Gross profit		35,447			38,989			39,740			44,800		57,462
Selling, general & administrative expenses		25,631			29,332			30,102			35,755		44,728
Operating income		9,816			9,657			9,638			9,045		12,734
Other expense		128			211			296			405		646
Interest (income) expense		(229	)		(80	)		(21	)		42		665
Income before provision for income taxes		9,917			9,526			9,363			8,598		11,423
Provision for income taxes		3,939			3,644			3,606			3,439		4,334
Net income	$	5,978		$	5,882		$	5,757		$	5,159	$	7,089
Net income per share — basic	$	1.15		$	1.13		$	1.12		$	0.99	$	1.33
Net income per share — diluted	$	1.12		$	1.10		$	1.10		$	0.94	$	1.27
Weighted average shares outstanding — basic		5,219			5,187			5,131			5,187		5,334
Weighted average shares outstanding — diluted		5,343			5,330			5,216			5,465		5,601
Consolidated Balance Sheet Data:
Working capital	$	15,060		$	15,499		$	12,252		$	13,750	$	11,126
Total assets		62,083			65,817			73,989			81,831		117,119
Long-term debt, including current portion		—			—			—			—		18,701
Stockholders’ equity	$	49,027		$	53,946		$	60,140		$	66,883	$	76,074

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Item 7.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the Consolidated Financial Statements

and the related notes that appear elsewhere in this document.

Certain statements in this Annual Report, particularly statements contained in this Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “anticipate”, “believe”, “estimate”, “expect”, “plan”, “intend” and other similar expressions are intended to identify these forward-looking statements, but are not the exclusive means of identifying them. Forward-looking statements included in this Annual Report or hereafter included in other publicly available documents filed with the Securities and Exchange Commission (“SEC”), reports to our stockholders and other publicly available statements issued or released by us involve known and unknown risks, uncertainties, and other factors which could cause our actual results, performance (financial or operating) or achievements to differ from the future results, performance (financial or operating) or achievements expressed or implied by such forward looking statements. Such future results are based upon our best estimates based upon current conditions and the most recent results of operations. Various risks, uncertainties and contingencies could cause our actual results, performance or achievements to differ materially from those expressed in, or implied by, the forward-looking statements contained in this Annual Report. These include, but are not limited to, those described above under Item 1A, “Risk Factors.”

Overview

We own and operate 45 dental laboratories located in 30 states, serving an active customer base of over 22,000 dentists. Our business consists of the design, fabrication, marketing and sale of custom dental prosthetic appliances for dentists located primarily in the domestic marketplace.

Our products are grouped into the following three main categories:

Restorative Products.  Restorative products that our dental laboratories sell consist primarily of crowns and bridges. A crown replaces the part of a tooth that is visible, and is usually made of gold or porcelain. A bridge is a restoration of one or more missing teeth that is permanently attached to the natural teeth or roots. In addition to the traditional crown, we also make porcelain jackets, which are crowns constructed entirely of porcelain; onlays, which are partial crowns which do not cover all of the visible tooth; and precision crowns, which are restorations designed to receive and connect a removable partial denture. We also make inlays, which are restorations made to fit a prepared tooth cavity and then cemented into place.

Reconstructive Products.  Reconstructive products sold by our dental laboratories consist primarily of partial dentures and full dentures. Partial dentures are removable dental prostheses that replace missing teeth and associated structures. Full dentures are dental prostheses that substitute for the total loss of teeth and associated structures. We also sell precision attachments, which connect a crown and an artificial prosthesis, and implants, which are fixtures anchored securely in the bone of the mouth to which a crown, partial or full denture is secured by means of screws or clips.

Cosmetic Products.  Cosmetic products sold by our dental laboratories consist primarily of porcelain veneers and ceramic crowns. Porcelain veneers are thin coverings of porcelain cemented to the front of a tooth to enhance personal appearance. Ceramic crowns are crowns made from ceramic materials that most closely replicate natural teeth. We also sell composite inlays and onlays, which replace silver fillings for a more natural appearance, and orthodontic appliances, which are products fabricated to move existing teeth to enhance function and appearance.

Internal sales growth was relatively flat from 2001 to 2004, when we made note that the economic climate appeared to be impacting the dental laboratory industry. We believe that many patients and dentists have postponed optimal treatment plans, such as crowns, and have been pursuing less expensive alternatives such as amalgam fillings, for which we recognize no revenue. The general economic conditions affecting our operations in the dental laboratory industry have remained less than favorable as consumers continue this conservative practice. In 2005, we experienced internal sales growth of 3.7%, which included selling price increases during the period ranging from 3.5% to 10.0% at various laboratories and on various product lines and therefore indicates a decline in unit volume.

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We believe that the market available for domestic dental laboratories has stopped growing and has begun to shrink as competition from offshore laboratories, primarily located in China, makes inroads into the low margin segment of the industry, and that this trend is impacting domestic industry growth. In addition, we face growing competition from technology based solutions that allow dentists to fabricate their own restorations without the use of a dental lab.

The main components of costs for us are labor and related employee benefits. Over the last few years, competition for labor resources as well as increases in medical insurance premiums has driven these costs higher. We continually review and adjust staffing levels as appropriate at each of our locations while recognizing the need to maintain an available and properly trained workforce. In 2004 we experienced cost pressure resulting from the implementation expenditures necessary to comply with Section 404 of the Sarbanes Oxley Act. Due in large part to the decentralized nature of our business, approximately half of our laboratories are subject to detailed onsite testing. The scope and complexity of our Section 404 project required us to engage the accounting firm of Deloitte and Touche, LLP. In addition, external audit fees for PricewaterhouseCoopers, LLP were significantly higher than in the prior years. The impact of these various Section 404 implementation costs on earnings in 2004 was approximately $1,027,000, or approximately $0.11 per diluted share, net of taxes, with most of that occurring in the fourth quarter. For the year ended December 31, 2005, the cost of maintaining our compliance with Section 404 was approximately $720,000, or approximately $0.08 per diluted share, net of taxes. We believe that these compliance costs will continue to decrease, although significant ongoing expenditures will be required to maintain our efforts within the internal controls framework required by the Sarbanes-Oxley Act.

We have also continued to pursue an acquisition strategy, which has played an important role in helping us increase sales from $75,680,000 in 2000 to $135,843,000 in 2005. Beginning in 2004 we recognized acquired customer relationships and trade names as intangible assets which require the recognition of amortization expense (for the customer relationships) and impairment testing (for the trade names). On a prospective basis, amortization expense will increase based upon our acquisition activity. The amount recognized for customer relationships and subsequent amortization expense will be dependent upon the expected profitability and customer retention characteristics of the acquired businesses. Amortization expense for customer relationships was $345,000 in 2004 and $599,000 in 2005, while impairment expense was $140,000 in 2004 and $10,000 in 2005.

Effective March 1, 2005 we completed our largest acquisition to date, Green Dental Laboratories, Inc (“Green”). Green is notable for several reasons. We believe that the synergies created by the addition of this laboratory will create value for the organization as a whole. Annualized sales at Green are expected to approximate $16,000,000, making Green our largest laboratory. Green is treated as a separate operating segment for reporting purposes and will retain a separate company identity as a wholly owned subsidiary. In order to finance the purchase of Green, we borrowed approximately $20,000,000 in long term debt and as a result, are more highly leveraged than we were prior to the Green acquisition. Interest expense has therefore become a more significant component of our pre-tax earnings. Interest expense in 2005, net of capitalized interest of $109,000, was $665,000 compared to $42,000 in 2004.

The earnings performance of Green and other recent acquisitions have allowed us to increase our sales and gross margin significantly. For the year ended December 31, 2005, net sales increased $24,090,000 or 21.6% with $19,980,000 attributable to acquisitions, measured by business at dental laboratories owned less than one year. For the year ended December 31, 2005, gross profit increased $12,662,000, or 28.3%, with $10,090,000 attributable to acquisitions. For the year ended December 31, 2005, approximately 17.9% of the growth in sales and 22.6% of the growth in gross profit was attributable to recent acquisitions.

Liquidity and Capital Resources

Our working capital decreased from $13,750,000 at December 31, 2004 to $11,126,000 at December 31, 2005, primarily as a result of increased capital expenditures. Additions to property, plant and equipment, were $7,578,000 for the year ended December 31, 2005, significantly more than the $3,263,000 spent for the year ended December 31, 2004, primarily resulting from expenditures related to new facilities. In 2004 we purchased a replacement facility for our dental laboratory in Houston, Texas at a cost of $2,000,000. During the second half of 2005, we completed the related build-out project. The cost of these building improvements was approximately $2,935,000 and the new facility was placed in service in November, 2005.

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Cash and cash equivalents decreased $1,815,000 from $2,216,000 at December 31, 2004 to $401,000 at December 31, 2005. Operating activities provided $12,758,000 in cash flow for the year ended December 31, 2005 compared to $7,829,000 during the year ended December 31, 2004, an increase of $4,929,000. This increase was primarily attributable to (1) increases in accounts payable and accrued liabilities of $2,183,000, primarily due to timing differences related to payroll and related benefits of approximately $1,858,000 and (2) increased net income and adjustments for depreciation and amortization of $2,738,000 offset by increases in inventories of $426,000, due primarily to increases of $250,000 in raw materials and $130,000 in work in process inventories due to increased production volume.

Cash outflows related to dental laboratory acquisitions, including deferred purchase price payments associated with prior period acquisitions, totaled $25,033,000 for the year ended December 31, 2005 compared to $6,929,000 for the year ended December 31, 2004. The increase was primarily due to the acquisition of Green.

We executed a financing agreement (the “Agreement”) with Fleet National Bank, now known as Bank of America, N.A. (the “Bank”). The Agreement, dated June 30, 2004, included a revolving line of credit of $5,000,000 and a revolving acquisition line of credit of $20,000,000. The interest rate on both revolving lines of credit was the prime rate or, at our option, the London Interbank Offered Rate (“LIBOR”), or a cost of funds rate plus a range of .75% to 1.5% depending on the ratio of total liabilities to tangible net worth. Both revolving lines of credit were to terminate on June 30, 2007. An unused facility fee of one eighth of 1% per annum was payable on the unused amount of the first revolving line of credit. A facility fee of $10,000 per year was required on the acquisition line of credit.

On August 9, 2005 the Agreement was superseded by an Amended and Restated Agreement (the “Amended Agreement”) with the Bank, adding a five year credit facility in the form of a term loan in the principal amount of $20,000,000. Accordingly, amounts previously borrowed under the revolving acquisition line of credit were repaid under the term loan facility, creating $20,000,000 of availability under the acquisition line of credit. Additionally, certain terms and conditions of the original Agreement were amended. The interest rate on both revolving lines of credit and the term loan is now the prime rate or, at our option, LIBOR, a cost of funds rate, or the Bank’s fixed rate plus a range of 1.25% to 2.25% depending on the ratio of consolidated funded debt to consolidated “EBITDA”, as defined in the Amended Agreement. The Amended Agreement requires monthly payments of principal, based on a seven year amortization schedule, with a final payment due on the fifth anniversary of the Amended Agreement. The Amended Agreement requires compliance with certain covenants, including the maintenance of specified net worth and other financial ratios. As of December 31, 2005, the full $5,000,000 was available under the first line of credit and the full $20,000,000 was available under the acquisition line of credit.

	December 31, 2005
Total long-term debt	$	18,701,000
Less: Current maturities		2,841,000
Long-term debt, less current portion	$	15,860,000

The table below reflects the expected repayment terms associated with this new term loan facility at December 31, 2005. The interest rate associated with our current borrowings as of December 31, 2005 is 6.23%.

	Principal Due
Fiscal 2006	$	2,841,000
Fiscal 2007		2,841,000
Fiscal 2008		2,841,000
Fiscal 2009		2,841,000
Fiscal 2010		7,337,000
Total	$	18,701,000

We believe that cash flow from operations and available financing will be sufficient to meet contemplated operating and capital requirements and deferred payments associated with prior acquisitions for the foreseeable future.

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Commitments and Contingencies

The following table represents a list of our contractual obligations and commitments as of December 31, 2005:

	Payments Due By Period
			Less Than						Greater Than
	Total		1 Year		1 - 3 Years		4 - 5 Years		5 Years
Term Loan Facility	$	18,701,000	$	2,841,000	$	8,523,000	$	7,337,000		—
Interest Expense		3,327,000		1,046,000		2,065,000		216,000		—
Operating Leases:
Real Estate		14,108,000		2,517,000	$	5,545,000	$	2,586,000	$	3,460,000
Vehicles		1,000,000		653,000		347,000		—		—
Equipment		132,000		59,000		70,000		3,000		—
Laboratory Purchase Obligations		3,391,000		1,338,000		2,053,000		—		—
Contingent Laboratory Purchase Price		3,122,000		2,155,000		967,000		—		—
TOTAL	$	43,781,000	$	10,609,000	$	19,570,000	$	10,142,000	$	3,460,000

In August, 2005 we converted borrowings on the acquisition line of credit to our new term loan facility. Bank borrowings on the term loan facility, net of the current portion of long-term debt are classified as long-term debt on the balance sheet. Interest expense related to the term loan facility has been projected using the interest rate associated with current borrowings.

We are committed under various non-cancelable operating lease agreements covering office space and dental laboratory facilities, vehicles and certain equipment. Certain of these leases also require us to pay maintenance, repairs, insurance and related taxes.

Laboratory purchase obligations totaling $3,391,000, classified as deferred acquisition costs, are presented in the liability section of the balance sheet. These obligations, including deferred obligations associated with non-competition agreements, represent purchase price commitments arising from dental laboratory acquisitions, irrespective of the acquired laboratory’s earnings performance. Contingent laboratory purchase price includes amounts subject to acquisition agreements that are tied to laboratory earnings performance, as defined within the acquisition agreements, generally over a three year period. As payments become determinable, they are recorded as goodwill.

As sponsor of the National Dentex Corporation Dollars Plus Plan, (the “Plan”), a qualified plan under Section 401(a) of the Internal Revenue Code, we have filed a retroactive plan amendment under the Internal Revenue Service’s Voluntary Correction Program to clarify the definition of compensation in the Plan. Based on our consultation with our ERISA counsel, we believe this issue will be favorably resolved without requiring additional employer contributions or jeopardizing the tax-qualified status of the Plan.

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Results of Operations

Beginning in 2005, our results are reported within two operating segments, NDX Laboratories and Green. The following table sets forth for the periods indicated the percentage of net sales represented by certain items in our Consolidated Financial Statements:

	Years Ended December 31,
	2003			2004			2005
Net sales		100.0	%		100.0	%		100.0	%
Cost of goods sold		60.0			59.9			57.7
Gross profit		40.0			40.1			42.3
Selling, general and administrative expenses		30.3			32.0			32.9
Operating income		9.7			8.1			9.4
Other expense		0.3			0.4			0.5
Interest expense		0.0			0.0			0.5
Income before provision for income taxes		9.4			7.7			8.4
Provision for income taxes		3.6			3.1			3.2
Net income		5.8	%		4.6	%		5.2	%

  Year Ended December 31, 2005 Compared with Year Ended December 31, 2004

Net Sales

For the year ended December 31, 2005, net sales increased $24,090,000 or 21.6% over the prior year. Net sales increased by approximately $19,980,000 as a result of acquisitions, measured by business at dental laboratories owned less than one year, including $14,513,000 attributable to Green. Net sales increased approximately $4,110,000, or 3.7% at dental laboratories owned for both the year ended December 31, 2005 and the comparable year ended December 31, 2004, primarily due to price increases approximating 10%, offset by a decline in the total number of units sold of an estimated 6%.

Cost of Goods Sold

Our cost of goods sold increased by $11,428,000 or 17.1% in the fiscal year ended December 31, 2005 over the prior fiscal year, attributable primarily to increased units due to acquired sales. As a percentage of sales, cost of goods sold decreased from 59.9% to 57.7%. This decrease was primarily attributable to the impact of Green’s higher margins on consolidated results. Green produced a gross profit of 47.5%, compared to a gross profit of 41.7% for the NDX Laboratories. Green’s scale of operations within a single location provides efficiencies in overhead costs and greater labor productivity, offset by higher materials costs due to product mix variables. Labor productivity improvements as a percentage of sales helped improve our gross margin, offsetting increases in employee health insurance costs. As a percentage of sales, labor and related benefits declined from 37.6% in 2004 to 36.3% in 2005. Green’s labor costs of 30.5% lowered the overall percentage and the portion attributable to NDX Laboratories declined to 37.0%.

The cost of raw materials as a percentage of sales declined from 14.3% in 2004 to 13.7% in 2005. During the fourth quarter of 2005, the cost of precious metals, including gold and palladium which are components of many dental alloys, increased approximately 15% and 25%, respectively, over costs experienced in the prior nine months. Although we are able to pass metal cost increases on to our customers, prolonged higher metal costs will have a negative impact on gross profit percentages.

Selling, General and Administrative Expenses

Operating expenses, which consist of selling, delivery and administrative expenses both at the laboratory and corporate level, increased by $8,973,000 or 25.1% in the year ended December 31, 2005 compared to 2004. Operating expenses increased as a percentage of net sales from 32.0% in 2004 to 32.9% in 2005. As a percentage of

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sales, administrative, delivery and selling expenses in 2005 were materially consistent with 2004. The largest increases were related to administrative expenses at the corporate level and increased laboratory incentive compensation resulting from improved earnings performance. The increase of $8,973,000 was primarily attributable to the following increases, offset by a decrease in trade name impairment expense of $130,000:

•  additional operating and amortization expense associated with acquisitions completed in 2005 — $4,970,000;

•  increases in salaries and benefits at the corporate and lab level, in part due to the addition of financial and management staff and increases in health insurance — $1,170,000;

•  increases in consulting expenses and professional fees, including audit and compliance costs —  $651,000;

•  increases in laboratory incentive compensation as a result of improved laboratory profit performance — $542,000;

•  increases in depreciation and maintenance costs related to computer systems and software — $232,000;

•  increases in bad debt expense associated with credit risk in our receivables portfolio — $206,000;

•  increases in training and recruiting expenses — $130,000; and

•  increases in delivery costs, including additional salaries and cost increases related to higher fuel prices —  $715,000.

Operating Income

As a result of the above factors, our operating income increased by $3,689,000 to $12,734,000 for the year ended December 31, 2005 from $9,045,000 for the prior year. As a percentage of net sales, operating income increased from 8.1% in 2004 to 9.4% in 2005.

Interest Expense

Net interest increased $623,000 from $42,000 in 2004 to $665,000 in 2005, primarily as a result of a bank borrowings to fund the acquisition of Green.

Provision for Income Taxes

The provision for income taxes increased by $895,000 to $4,334,000 in 2005 from $3,439,000 in 2004. The 40.0% effective tax rate for fiscal year 2004 decreased to 37.9% for fiscal year 2005. The decrease in effective tax rate for 2005 was due in part to recognition of lower federal tax expense resulting from the domestic manufacturing tax credit provisions of the American Jobs Creation Act of 2004.

Net Income

As a result of all the factors discussed above, net income increased $1,930,000 to $7,089,000 or $1.27 per share on a diluted basis in 2005 from $5,159,000 or $0.94 per share on a diluted basis in 2004.

  Year Ended December 31, 2004 Compared with Year Ended December 31, 2003

Net Sales

For the year ended December 31, 2004, net sales increased $12,479,000 or 12.6% over the prior year. Net sales increased by approximately $9,880,000 as a result of acquisitions, measured by business at dental laboratories owned less than one year. Net sales increased approximately $2,599,000, or 2.6% at dental laboratories owned for both the year ended December 31, 2004 and the comparable year ended December 31, 2003.

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Cost of Goods Sold

Our cost of goods sold increased by $7,419,000 or 12.5% in the fiscal year ended December 31, 2004 over the prior fiscal year, attributable primarily to increased unit sales. As a percentage of sales, cost of goods sold decreased slightly from 60.0% to 59.9%. Component percentages, such as labor and benefits and materials expenses, remained virtually unchanged from the prior year.

Selling, General and Administrative Expenses

Operating expenses, which consist of selling, delivery and administrative expenses both at the laboratory and corporate level, increased by $5,653,000 or 18.8% in the year ended December 31, 2004 compared to 2003. Operating expenses increased as a percentage of net sales from 30.3% in 2003 to 32.0% in 2004. As a percentage of sales, selling expenses declined while administrative expenses at the corporate level rose sharply in 2004 compared to 2003. The implementation of Section 404 of the Sarbanes-Oxley Act of 2002 required us to engage the services of Deloitte and Touche, LLP. Deloitte provided internal control design consultation and testing services as well as project management to help us meet our compliance obligations. Additionally, external audit fees rose sharply in connection with the Sarbanes-Oxley reporting requirements. As a result of these factors, we incurred an additional $1,027,000 in administrative costs.

Beginning in 2004, we revised our classification of certain intangibles acquired through current and prior period business combinations. Specifically, the recognition of value as assigned to customer relationship intangibles resulted in amortization expense of approximately $345,000. Additionally, we recorded a charge of $140,000 to recognize impairment of acquired trade names.

Selling costs declined as a percentage of sales as spending on the NDX Reliance Program^tm, our national marketing program, was reduced from $704,000 in 2003 to $620,000 in 2004. However, we continued to invest in local marketing efforts and our local marketing costs increased from $412,000 in 2003 to $528,000 in 2004.

Operating Income

As a result of lower than expected internal sales growth, attributable in part to a continued lackluster economic climate affecting consumer decisions on dental work, additional amortization expense and increases in compliance and audit expenses discussed above, offset partially by increased operating income associated with acquisitions, our operating income declined by $593,000 to $9,045,000 for the year ended December 31, 2004 from $9,638,000 for the prior year. As a percentage of net sales, operating income declined from 9.7% in 2003 to 8.1% in 2004.

Interest Expense

Net interest increased $63,000 from interest income of $21,000 in 2003 to interest expense of $42,000 in 2004, primarily as a result of a reduction in available cash coupled with the use of the line of credit to fund dental laboratory acquisitions.

Provision for Income Taxes

The provision for income taxes decreased by $167,000 to $3,439,000 in 2004 from $3,606,000 in 2003. The 38.5% effective tax rate for fiscal 2003 increased to 40.0% for fiscal 2004. The effective tax rate for 2003 was lower due to the finalization of certain permanent tax benefits.

Net Income

As a result of all the factors discussed above, net income decreased $598,000 to $5,159,000 or $0.94 per share on a diluted basis in 2004 from $5,757,000 or $1.10 per share on a diluted basis in 2003.

Critical Accounting Policies

Financial Reporting Release No. 60 as released by the SEC requires all companies to include a discussion of critical accounting policies or methods used in the preparation of financial statements. The preparation of our

17

consolidated financial statements requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of expenses during the reporting period. A summary of certain of our significant accounting policies is presented below.

Summary of Significant Accounting Policies

Revenue Recognition

Revenue is recognized upon transfer of title and risk of loss, generally as the dentists’ orders are shipped. Commencing in the fourth quarter of fiscal 2005, we have recorded shipping and handling fees charged to customers as revenues in accordance with EITF 00-10 “Accounting for Shipping and Handling Fees and Costs.” Prior to the fourth quarter, these fees were recorded as a reduction to selling, general and administrative expenses. The effect of recording these fees as reductions to selling general and administrative expenses was not material. Shipping and handling costs totaled approximately $8,354,000 in fiscal 2003, $9,209,000 in fiscal 2004 and $10,852,000 in fiscal 2005, and are included in selling, general and administrative expense.

Goodwill and Other Indefinite-Lived Intangible Assets Not Subject to Amortization

In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 142 “Goodwill and Other Intangible Assets” (“SFAS 142”), goodwill amortization ceased on December 31, 2001. We continually evaluate whether events and circumstances have occurred that indicate that the value of goodwill has been impaired. In accordance with SFAS No. 142, goodwill is evaluated for possible impairment on an annual basis, based on a two-step process. The first step is to compare the fair value of the reporting unit to its carrying amount to determine if there is potential impairment. The second step, used to measure the amount of impairment loss, compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. In accordance with SFAS No. 142, the reporting unit is an operating segment or one level below an operating segment (referred to as a component). We view the individual laboratories as reporting units. We determine fair value using factors based on revenue and operating margins. In the second quarter of 2003, 2004 and 2005 we completed the impairment testing and determined that no impairment existed.

Additionally, we also recognize the existence of value in trade names acquired in business combinations and believe the useful life of this intangible to be indefinite. Accordingly, trade names are also evaluated for impairment on an annual basis using a single-step method in accordance with SFAS No. 142. Impairment charges related to trade names are recognized when the fair value is less than the carrying value of the asset. Impairment charges related to trade names were recorded in the year ended December 31, 2004 in the amount of $140,000, of which $77,000, an immaterial amount, relates to prior periods. Impairment charges of $10,000 were recorded in the year ended December 31, 2005. Trade name impairment charges generally result from a decline in forecasted revenue at specific laboratories in comparison to revenue forecasts used in previous valuation calculations.

Intangible Assets Subject to Amortization

We follow the applicable accounting pronouncements — specifically SFAS No. 141 “Business Combinations” and Emerging Issues Task Force Abstract 02-17 “Recognition of Customer Relationship Intangible Assets Acquired in a Business Combination” (“EITF 02-17”), in accounting for purchase business combinations. Non-competition agreements and customer relationship intangibles arising from dental laboratory acquisitions are amortized over their useful lives. The acquisition date fair value of non-competition agreements are deferred and amortized over their economic useful lives, in accordance with the terms of the agreements, ranging from 2 to 15 years. The acquisition date fair value associated with acquired customer relationships are amortized over their estimated economic useful life, ranging from 9 to 12 years.

Inventories

Inventories, consisting principally of raw materials, are stated at the lower of cost (first-in, first-out) or market. We use estimates based on specific identification to maintain proper reserves for excess and obsolete inventory. Additionally, we estimate work in process inventories by applying current labor, materials and selected overhead expense rates to standard production schedules. We estimate the value of unrefined precious metal scrap based on

18

the application of various return and refining statistics. Finished goods inventory consists of completed orders that were shipped to customers immediately subsequent to period end.

Property, Plant and Equipment

Property, plant and equipment are stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the following estimated depreciable lives:

Buildings	25 years
Furniture and fixtures	5 - 10 years
Laboratory equipment	5 - 20 years
Computer equipment	3 - 5 years

Leasehold improvements and capital leases are amortized over the lesser of the assets’ estimated useful lives or the lease terms.

Gains and losses are recognized upon the disposal of property and equipment, and the related accumulated depreciation and amortization are removed from the accounts. Maintenance, repairs and betterments that do not enhance the value of or increase the life of the assets are charged to operations as incurred.

Depreciation expense totaled approximately $1,630,000 in fiscal 2003, $1,888,000 in fiscal 2004, and $2,372,000 in fiscal 2005.

Impairment of Long-Lived Assets

At each balance sheet date, management evaluates the recoverability of long-lived assets, including property and equipment and intangible assets, using certain financial indicators, such as historical and future ability to generate income from operations. Our policy is to record an impairment loss in the period when it is determined that the carrying amount of the asset may not be recoverable. The determination is based on an evaluation of such factors as the occurrence of a significant event, a significant change in the environment in which the business operates or if the expected future cash flows become less than the carrying amount of the asset.

Cash Surrender of Life Insurance

The cash surrender value of life insurance policies are recorded at the lower of cost or market.

  Income Taxes

We follow SFAS No. 109, “Accounting for Income Taxes”. Under SFAS No. 109, deferred tax assets and liabilities are recognized for the expected future tax consequences of events that have been included in the financial statements or tax returns. The amount of deferred tax asset or liability is based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. We have considered our current financial characteristics as well as current tax law and do not believe that the recoverability of various tax assets and liabilities is impaired, and therefore have recorded them at their full value.

  Stock-Based Compensation

Effective January 1, 1996, we adopted the disclosure provisions of SFAS No. 123, “Accounting for Stock-Based Compensation.” In December 2004 the FASB issued SFAS No. 123 (revised 2004), “Share Based Payment”. We have elected to continue to account for employee stock options at intrinsic value, in accordance with Accounting Principles Board (“APB”) Opinion No. 25, “Accounting for Stock Issued to Employees,” with disclosure of the effects of fair value accounting on net income and earnings per share on a pro forma basis for the years ended December 31, 2003, 2004 and 2005. We reduced new option grants in 2003 and did not grant any options in 2004 or 2005.

19

  Recent Accounting Pronouncements

In November 2004, the FASB issued SFAS No. 151, “Inventory Costs — An Amendment of ARB No. 43, Chapter 4”. SFAS No. 151 amends the guidance in Accounting Research Bulletin (ARB) No. 43, Chapter 4, “Inventory Pricing,” to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage). Among other provisions, the new rule requires that items such as idle facility expense, excessive spoilage, double freight, and re-handling costs be recognized as current-period charges regardless of whether they meet the criterion of “so abnormal” as stated in ARB No. 43. Additionally, SFAS No. 151 requires that the allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities. SFAS No. 151 is effective for fiscal years beginning after June 15, 2005, and we are required to adopt it effective January 1, 2006. We do not expect SFAS No. 151 to have a material impact on our consolidated results of operations or financial condition.

In December 2004, the FASB issued SFAS No. 123 (revised 2004), “Share-Based Payment”. SFAS No. 123R supersedes APB Opinion No. 25, which requires recognition of an expense when goods or services are provided. SFAS No. 123R requires the determination of the fair value of the share-based compensation at the grant date and the recognition of the related expense over the period in which the share-based compensation vests. SFAS No. 123R permits two transition methods, the modified prospective method or the modified retrospective method. We will adopt SFAS No. 123R using the modified prospective method and will not adjust our prior financial statements. Under this method we will apply the provisions of SFAS No. 123R on new awards granted after adoption of SFAS No. 123R and unvested awards granted after December 15, 1994. Based on pro-forma financial information previously prepared for SFAS No. 123 disclosures, we expect the impact of SFAS No 123R to be immaterial as it relates to currently outstanding options. We will continue to assess the impact SFAS No. 123R and have deferred making additional grants pending this resolution.

On October 22, 2004, the President signed the American Jobs Creation Act of 2004 (the “Act”). The Act provides a deduction for income from qualified domestic production activities, which will be phased in from 2005 through 2010. In return, the Act also provides for a two-year phase-out of the existing extra-territorial income exclusion (ETI) for foreign sales that was viewed to be inconsistent with international trade protocols by the European Union. We expect the net effect of the phase out of the ETI and the phase in of this new deduction to result in a decrease in the effective tax rate for fiscal years 2005 and 2006 of approximately 1 percentage- point, based on current earnings levels. In the long-term, our management expects that the new deduction will result in a decrease of the annual effective tax rate by an amount up to 3 percentage-points based on current earnings levels.

Under the guidance in FASB Staff Position No. FAS 109-1, Application of SFAS No. 109, “Accounting for Income Taxes,” to the Tax Deduction on Qualified Production Activities Provided by the Act, the deduction will be treated as a “special deduction” as described in SFAS No. 109. As such, the special deduction has no effect on deferred tax assets and liabilities existing at the enactment date. Rather, the impact of this deduction will be reported in the period in which the deduction is claimed on our tax return.

Item 7A.   Quantitative and Qualitative Disclosures about Market Risk

Our market risk exposure includes potential price volatility of commodities we use in our manufacturing processes. We purchase dental alloys that contain gold, palladium and other precious metals. We have not participated in hedging transactions. We have relied on pricing practices that attempt to pass increased costs on to the customer, in conjunction with materials substitution strategies.

At December 31, 2005, we had variable rate debt of $18.7 million. Based on this amount, the earnings and cash flows impact for the next year resulting from a one percentage point increase in interest rates would be approximately $116,000, net of tax, holding other variables constant.

Item 8.   Financial Statements and Supplementary Data

Quarterly Results

The following table sets forth certain selected financial information for the eight fiscal quarters in our two most recently completed fiscal years. In our opinion, this unaudited information has been prepared on the same basis as

20

the audited financial information and includes all adjustments (consisting of only normal, recurring adjustments) necessary to present this information fairly when reviewed in conjunction with our Consolidated Financial Statements and notes thereto contained herein.

	Three Months Ended
	March 31,			June 30,			Sept. 30,			Dec. 31,			March 31,			June 30,			Sept. 30,			Dec. 31,
	2004			2004			2004			2004			2005			2005			2005			2005
	(Dollars in thousands except per share data)
Net sales	$	27,928		$	28,831		$	27,395		$	27,599		$	31,946		$	36,214		$	33,344		$	34,339
Gross profit	$	11,598		$	12,002		$	10,660		$	10,540		$	13,928		$	15,978		$	13,544		$	14,013
Gross margin		41.5	%		41.6	%		38.9	%		38.2	%		43.6	%		44.1	%		40.6	%		40.8	%
Operating income	$	2,713		$	3,485		$	1,682		$	1,165		$	3,164		$	4,650		$	2,506		$	2,414
Operating margin		9.7	%		12.1	%		6.1	%		4.2	%		9.9	%		12.8	%		7.5	%		7.0	%
Net income	$	1,581		$	2,022		$	935		$	621		$	1,779		$	2,588		$	1,378		$	1,344
Net income per diluted share	$	0.29		$	0.37		$	0.17		$	0.11		$	0.32		$	0.47		$	0.25		$	0.24

Our results of operations have historically fluctuated on a quarterly basis and are expected to be subject to quarterly fluctuations in the future. As a result, we believe that the results of operations for the interim periods are not necessarily indicative of the results to be expected for any future period or for a full year. Quarterly results are subject to fluctuations resulting from a number of factors, including the number of working days in the quarter for both dentists and our employees, the number of paid vacation days and holidays in the period, general economic conditions and consumer spending patterns. Historically, the second quarter has generated the highest quarterly net sales for the year and has been the most profitable for us due to the greater number of working days in the quarter and more patients scheduling visits with their dentists before departing for summer vacation.

Location of Financial Statements

The consolidated financial statements furnished in connection with this Report are attached immediately following Part IV.

Item 9.   Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A.   Controls and Procedures

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

We carried out an evaluation, with the participation of our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures as of December 31, 2005. In designing and evaluating our disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and our management necessarily applied its judgment in evaluation of the cost-benefit relationship of possible controls and procedures. Based on this evaluation, our principal executive officer and principal financial officer concluded that, as of December 31, 2005, our disclosure controls and procedures, as defined in the Securities Exchange Act (the “Exchange Act”) Rules 13a-15(e) and 15d-15(e), were effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and such information is accumulated and communicated to management, including the CEO and CFO, to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Under the supervision and with the participation of our

21

management, including our principal executive officer and principal financial officer, we carried out an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2005 based on the Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based upon this evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2005.

National Dentex Corporation acquired Wornson-Polzin Dental Laboratory Inc. (“Wornson”) on February 1, 2005 and Green Dental Laboratories, Inc. (“Green”) on March 1, 2005. These entities were acquired in purchase business combinations during 2005 and were excluded from management’s assessment as of December 31, 2005. Wornson had total assets of $3,542,000 and revenues of $2,917,000 and Green had total assets of $26,889,000 and revenues of $14,513,000, and these amounts were included in the consolidated financial statements of National Dentex Corporation and subsidiaries as of and for the year ended December 31, 2005.

PricewaterhouseCoopers LLP, the independent registered public accounting firm that audited our financial statements included in this Annual Report on Form 10-K, has also audited management’s assessment of the effectiveness of our internal control over financial reporting and the effectiveness of internal control over financial reporting as of December 31, 2005, as stated in their report which is included herein.

Changes in Internal Control over Financial Reporting

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the fiscal quarter ended December 31, 2005 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Item 9B.   Other Information

None.

PART III

Item 10.   Directors and Executive Officers of the Registrant

The information required by this Item is contained in our proxy statement for the annual meeting of stockholders scheduled to be held on May 16, 2006, which we plan to file with the SEC on or about March 27, 2006, but in no event later than 120 days after the end of our fiscal year ended December 31, 2005 (the “2006 Proxy Statement”). Such information is hereby incorporated by reference.

We have adopted a written code of business conduct and ethics that applies to all our directors, officers and employees, a copy of which is located on the Investor Relations page of our website which is located at www.nationaldentex.com. We intend to disclose any amendments to, or waivers from, our code of business conduct and ethics on that same page of our website.

Item 11.   Executive Compensation

The information required by this item will be included in our 2006 Proxy Statement and is incorporated herein by reference.

Item 12.   Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters

The information required by this item will be included in our 2006 Proxy Statement and is incorporated herein by reference.

Item 13.   Certain Relationships and Related Transactions

The information required by this item will be included in our 2006 Proxy Statement and is incorporated herein by reference.

22

Item 14.   Principal Accountant Fees and Services

The response to this item will be contained in our 2006 Proxy Statement under the caption “Independent Auditors Fees and Other Matters”, and is incorporated herein by reference.

PART IV

Item 15.   Exhibits and Financial Statement Schedules

(a) 1. Financial statements:

For a listing of consolidated financial statements which are included in this Report, see page F-1.

2. Financial Statement Schedules:

All schedules for which provision is made under Item 15(a)(2) are inapplicable and, therefore, have been omitted.

3. Exhibits:

The exhibits listed in the Exhibit Index immediately preceding the exhibits are filed as part of this Annual Report on Form 10-K and are incorporated herein by reference.

(b) Exhibits:

The exhibits listed in the Exhibit Index immediately preceding the exhibits are filed as part of this Annual Report on Form 10-K and are incorporated herein by reference.

(c) Financial Statement Schedules:

Included in Item 15(a)(2) above.

23

NATIONAL DENTEX CORPORATION

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE

	Page
Financial Statements:
The consolidated financial statements of National Dentex Corporation included herein are as listed below:
Report of Independent Registered Public Accounting Firm — PricewaterhouseCoopers LLP		F-2
Consolidated Balance Sheets as of December 31, 2004 and 2005		F-4
Consolidated Statements of Income for each of the three years in the period ended December 31, 2005		F-5
Consolidated Statements of Stockholders’ Equity for each of the three years in the period ended December 31, 2005		F-6
Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2005		F-7
Notes to Consolidated Financial Statements		F-8

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of National Dentex Corporation:

We have completed integrated audits of National Dentex Corporation’s 2005 and 2004 consolidated financial statements and of its internal control over financial reporting as of December 31, 2005 and an audit of its 2003 financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Our opinions, based on our audits, are presented below.

Consolidated financial statements

In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all material respects, the financial position of National Dentex Corporation and its subsidiaries at December 31, 2005 and December 31, 2004, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2005 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

Internal control over financial reporting

Also, in our opinion, management’s assessment, included in Management’s Report on Internal Control over Financial Reporting, appearing under Item 9A, that the Company maintained effective internal control over financial reporting as of December 31, 2005 based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), is fairly stated, in all material respects, based on those criteria. Furthermore, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2005, based on criteria established in Internal Control — Integrated Framework issued by the COSO. The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express opinions on management’s assessment and on the effectiveness of the Company’s internal control over financial reporting based on our audit. We conducted our audit of internal control over financial reporting in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. An audit of internal control over financial reporting includes obtaining an understanding of internal control over financial reporting, evaluating management’s assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we consider necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed 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. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

F-2

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

As described in Management’s Report on Internal Control over Financial Reporting, management has excluded Green Dental Laboratories, Inc. (“Green”) and Wornson-Polzin Dental Laboratory, Inc. (“Wornson”) from its assessment of internal control over financial reporting as of December 31, 2005 because they were acquired by the Company in purchase business combinations during 2005. Green and Wornson are operating segments whose total assets represent $26,899,000 and $3,542,000, respectively, and total revenues represent $14,513,000 and $2,917,000, respectively, of the related consolidated financial statement amounts as of and for the year ended December 31, 2005.

/s/  PricewaterhouseCoopers LLP

Boston, Massachusetts

March 16, 2006

F-3

NATIONAL DENTEX CORPORATION

CONSOLIDATED BALANCE SHEETS

	December 31,		December 31,
	2004		2005
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	2,215,742	$	401,251
Accounts receivable:
Trade, less allowance of $181,000 in 2004 and $300,000 in 2005		12,299,033		14,468,140
Other		692,910		595,481
Inventories		5,838,898		6,700,283
Prepaid expenses		2,479,939		3,127,157
Deferred tax asset		—		8,646
Property held for sale		—		508,596
Total current assets		23,526,522		25,809,554
PROPERTY, PLANT AND EQUIPMENT:
Land and buildings		6,672,945		8,531,337
Leasehold and building improvements		7,217,877		10,433,008
Laboratory equipment		12,265,565		15,331,829
Furniture and fixtures		5,056,849		6,170,476
		31,213,236		40,466,650
Less — Accumulated depreciation and amortization		16,027,568		16,854,004
Net property, plant and equipment		15,185,668		23,612,646
OTHER ASSETS, net:
Goodwill		30,384,978		48,242,149
Trade names		2,940,000		5,644,443
Customer relationships		2,598,531		5,718,864
Non-competition agreements		2,724,401		2,656,329
Other assets		4,470,568		5,435,025
Total other assets		43,118,478		67,696,810
Total assets	$	81,830,668	$	117,119,010
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Revolving line of credit	$	2,000,000		—
Current portion of long-term debt		—	$	2,840,621
Accounts payable		2,318,632		3,449,227
Accrued liabilities:
Payroll and employee benefits		3,781,976		5,505,811
Current portion of deferred acquisition costs		745,261		1,338,224
Other accrued expenses		798,785		1,549,703
Deferred tax liability, current		131,878		—
Total current liabilities		9,776,532		14,683,586
LONG-TERM LIABILITIES:
Long-term obligations, less current portion		—		15,860,133
Deferred Compensation		2,461,726		2,956,417
Deferred acquisition costs		112,384		2,052,630
Deferred tax liability, non-current		2,596,641		5,492,163
Total long-term liabilities		5,170,751		26,361,343
COMMITMENTS AND CONTINGENCIES (Note 8)
STOCKHOLDERS’ EQUITY:
Preferred stock, $.01 par value
Authorized — 500,000 shares
None issued and outstanding		—		—
Common stock, $.01 par value
Authorized — 8,000,000 shares
Issued and Outstanding — 5,263,798 shares at December 31, 2004 and 5,411,463 shares at December 31, 2005		52,638		54,114
Paid-in capital		13,502,786		15,603,188
Retained earnings		53,327,961		60,416,779
Total stockholders’ equity		66,883,385		76,074,081
Total liabilities and stockholders’ equity	$	81,830,668	$	117,119,010

The accompanying notes are an integral part of these consolidated financial statements.

F-4

NATIONAL DENTEX CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

	Years Ended
	December 31,		December 31,			December 31,
	2003		2004			2005
Net sales	$	99,273,550	$	111,752,547		$	135,842,674
Cost of goods sold		59,533,766		66,952,585			78,380,380
Gross profit		39,739,784		44,799,962			57,462,294
Selling, general and administrative expenses		30,101,751		35,755,242			44,728,227
Operating income		9,638,033		9,044,720			12,734,067
Other expense		295,606		404,343			646,436
Interest income (expense)		20,558		(42,324	)		(665,108	)
Income before provision for income taxes		9,362,985		8,598,053			11,422,523
Provision for income taxes		3,605,940		3,439,221			4,333,705
Net income	$	5,757,045	$	5,158,832		$	7,088,818
Net income per share — basic	$	1.12	$	0.99		$	1.33
Net income per share — diluted	$	1.10	$	0.94		$	1.27
Weighted average shares outstanding — basic		5,130,659		5,186,589			5,333,597
Weighted average shares outstanding — diluted		5,216,022		5,465,106			5,601,441

The accompanying notes are an integral part of these consolidated financial statements.

F-5

NATIONAL DENTEX CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

	Common Stock
	Number of			$.01 Par			Paid-in			Retained			Treasury
	Shares			Value			Capital			Earnings			Stock			Total
BALANCE, December 31, 2002		5,497,814		$	36,652		$	16,643,963		$	42,430,900		$	(5,165,544	)	$	53,945,971
Issuance of 14,190 shares of common stock under the stock option plans		14,190			95			128,483						—			128,578
Issuance of 24,529 shares of common stock under the employee stock purchase program		24,529			164			260,496						—			260,660
Net income		—			—			—			5,757,045			—			5,757,045
Issuance of 3,892 shares of treasury stock as director’s fees		—			—			1,401			—			46,606			48,007
BALANCE, December 31, 2003		5,536,533			36,911			17,034,343			48,187,945			(5,118,938	)		60,140,261
Issuance of 84,553 shares of common stock under the stock option plans		84,553			575			1,064,262						—			1,064,837
Issuance of 27,236 shares of common stock under the employee stock purchase program		27,236			181			285,171						—			285,352
Tax benefit associated with exercise of stock options								139,143									139,143
Three-for-two stock split, including fractional shares paid out		(125	)		18,815						(18,816	)					(1	)
Net income		—			—			—			5,158,832			—			5,158,832
Issuance of 5,008 shares of treasury stock as director’s fees								34,992			—			59,969			94,961
Treatment of 384,399 shares of treasury stock as unissued shares		(384,399	)		(3,844	)		(5,055,125	)		—			5,058,969			—
BALANCE, December 31, 2004		5,263,798			52,638			13,502,786			53,327,961			—			66,883,385
Issuance of 122,341 shares of common stock under the stock option plans		122,341			1,223			1,508,274						—			1,509,497
Issuance of 21,526 shares of common stock under the employee stock purchase program		21,526			215			332,832						—			333,047
Tax benefit associated with exercise of stock options								187,362									187,362
Net income		—			—			—			7,088,818			—			7,088,818
Issuance of 3,798 shares of common stock as director’s fees		3,798			38			71,934			—			—			71,972
BALANCE, December 31, 2005		5,411,463		$	54,114		$	15,603,188		$	60,416,779		$			$	76,074,081

The accompanying notes are an integral part of these consolidated financial statements.

F-6

NATIONAL DENTEX CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Years Ended
	December 31,			December 31,			December 31,
	2003			2004			2005
Cash flows from operating activities:
Net income	$	5,757,045		$	5,158,832		$	7,088,818
Adjustments to reconcile net income to net cash provided by operating activities, net of effects of acquisitions:
Depreciation and amortization		2,383,260			3,131,697			3,939,664
Loss on disposal of property, plant and equipment		32,724			14,645			105,398
(Benefit) provision for deferred income taxes		(118,867	)		739,111			(487,414	)
Impairment of long-lived assets		—			140,000			10,000
Tax benefit associated with exercise of stock options		—			139,143			187,362
Issuance of common stock as director’s fees		48,007			94,961			71,972
Provision (benefit) for bad debts		152,097			(40,817	)		163,134
Losses on write-down of inventories		—			—			36,399
Changes in operating assets and liabilities, net of effects of acquisitions:
Increase in accounts receivable		(332,991	)		(508,070	)		(462,076	)
(Increase) decrease in inventories		(103,962	)		315,824			(146,854	)
Decrease (increase) in prepaid expenses		478,938			(777,307	)		(602,853	)
(Increase) decrease in other assets		(108,980	)		(1,214,934	)		34,596
(Decrease) increase in accounts payable and accrued liabilities		(414,018	)		636,229			2,819,403
Net cash provided by operating activities		7,773,253			7,829,314			12,757,549
Cash flows from investing activities:
Payment for acquisitions, net of cash acquired		(7,306,153	)		(3,679,492	)		(23,456,720	)
Payment of deferred purchase price		(1,491,619	)		(3,249,189	)		(1,575,780	)
Premiums paid for life insurance policies		(589,784	)		(607,652	)		(504,425	)
Additions to property, plant and equipment, net		(2,747,899	)		(3,262,898	)		(7,578,413	)
Net cash used in investing activities		(12,135,455	)		(10,799,231	)		(33,115,338	)
Cash flows from financing activities:
Borrowings of revolving line of credit		—			2,000,000			—
Repayments of revolving line of credit					—			(2,000,000	)
Borrowings of long-term debt		—			—			19,884,346
Repayments of long-term debt		—			—			(1,183,592	)
Net proceeds from issuance of common stock		389,238			1,350,188			1,842,544
Net cash provided by financing activities		389,238			3,350,188			18,543,298
Net (decrease) increase in cash and cash equivalents		(3,972,964	)		380,271			(1,814,491	)
Cash and cash equivalents at beginning of period		5,808,435			1,835,471			2,215,742
Cash and cash equivalents at end of period	$	1,835,471		$	2,215,742		$	401,251
Supplemental disclosures of cash flow information:
Interest paid (net of capitalized interest of $109,000 in 2005)	$	11,184		$	51,012		$	689,118
Income taxes paid	$	2,718,140		$	3,734,480		$	4,289,112
Supplemental schedule of non-cash investing and financing activities:
The Company purchased the operations of certain dental laboratories in 2003 2004 and 2005.
In connection with these acquisitions, liabilities were assumed as follows:
Fair value of assets acquired including acquired cash	$	10,477,000		$	5,773,000		$	32,083,000
Cash purchase price		(8,255,000	)		(4,319,000	)		(24,582,000	)
Deferred purchase price at date of acquisition		(375,000	)		(544,000	)		(2,444,000	)
Liabilities assumed	$	1,847,000		$	910,000		$	5,057,000

The accompanying notes are an integral part of these consolidated financial statements.

F-7

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2005

(1)   Organization

National Dentex Corporation (the “Company”) owned and operated 41 full-service dental laboratories and four branch laboratories in 30 states throughout the United States as of December 31, 2005. Working from dentists’ work orders, the Company’s dental laboratories custom design and fabricate dentures, crowns and fixed bridges, and other dental prosthetic appliances.

(2)   Summary of Significant Accounting Policies

Principles of Consolidation

The Company follows the guidance established in FASB Interpretation No. 46, “Consolidation of Variable Interest Entities”, in presenting the consolidated financial statements. The consolidated financial statements include all operations of the Company. Acquisitions are reflected from the date acquired by the Company (see Note 3) to December 31, 2005. All significant inter-company balances and transactions have been eliminated in consolidation.

Revenue Recognition

Revenue is recognized upon transfer of title and risk of loss, generally as the dentists’ orders are shipped. Commencing in the fourth quarter of fiscal 2005, the Company has recorded shipping and handling fees charged to customers as revenues in accordance with EITF 00-10 “Accounting for Shipping and Handling Fees and Costs”. Prior to the fourth quarter, these fees were recorded as a reduction to selling, general and administrative expenses. The effect of recording these fees as reductions to selling general and administrative expenses was not material. Shipping and handling costs totaling approximately $8,354,000, $9,209,000 and $10,852,000 for the years ended December 31, 2003, 2004 and 2005, respectively, are included in selling, general and administrative expense.

Goodwill and Other Indefinite-Lived Intangible Assets Not Subject to Amortization

In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 142, goodwill amortization ceased on December 31, 2001. The Company continually evaluates whether events and circumstances have occurred that indicate that the value of goodwill has been impaired. In accordance with SFAS No. 142, goodwill is evaluated for possible impairment on an annual basis, based on a two-step process. The first step is to compare the fair value of the reporting unit to its carrying amount to determine if there is potential impairment. The second step, used to measure the amount of impairment loss, compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. In accordance with SFAS No. 142, the reporting unit is an operating segment or one level below an operating segment (referred to as a component). The Company views the individual laboratories as reporting units. The Company determines fair value using factors based on revenue and operating margins. In the second quarters of 2003, 2004 and 2005 the Company completed the impairment testing and determined that no impairment existed.

Additionally, the Company also recognizes the existence of value in trade names acquired in business combinations and believes the useful life of this intangible to be indefinite. Accordingly, trade names are also evaluated for impairment on an annual basis using a single step method in accordance with SFAS No. 142. Impairment charges related to trade names are recognized when the fair value is less than the carrying value of the asset. Impairment charges related to trade names were recorded in the amount of $140,000 and $10,000 for the years ended December 31, 2004 and 2005, respectively. Trade name impairment charges generally result from a decline in forecasted revenue at specific laboratories in comparison to revenue forecasts used in previous valuation calculations.

Intangible Assets Subject to Amortization

The Company follows the applicable accounting pronouncements — specifically SFAS No. 141 Business Combinations and Emerging Issues Task Force Abstract 02-17 Recognition of Customer Relationship Intangible

F-8

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Assets Acquired in a Business Combination in accounting for purchase business combinations. Non-competition agreements and customer relationship intangibles arising from dental laboratory acquisitions are amortized over their useful lives. The acquisition date fair value of non-competition agreements are deferred and amortized over their economic useful lives, in accordance with the terms of the agreements, over 2 to 15 years. The acquisition date fair value associated with acquired customer relationships are amortized over their estimated useful life, over 9 to 12 years.

Advertising and Promotional Costs

Advertising, promotional and marketing costs are charged to earnings in the period in which they are incurred, in accordance with AICPA Statement of Position (SOP) 93-7, “Reporting on Advertising Costs.” These costs were approximately $1,116,000, $1,148,000 and $1,252,000 for the years ended December 31, 2003, 2004 and 2005, respectively.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with maturities of 90 days or less to be cash equivalents. The Company has cash investments including overnight repurchase agreements with financial institutions in excess of the $100,000 insured limit of the Federal Deposit Insurance Corporation.

Accounts Receivable and Allowance for Doubtful Accounts

Trade accounts receivable are recorded at the invoiced amount. Service charges are assessed on balances 60 days past due. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable. The Company determines the allowance based on historical write-off experience. The Company reviews its allowance for doubtful accounts monthly. Past due balances over 90 days and over a specified amount are reviewed individually for collectibility. All other balances are reviewed on a pooled basis by type of receivable. Account balances are charged off against the allowance when the Company feels it is probable the receivable will not be recovered. The Company does not have any off-balance-sheet credit exposure related to its customers.

Receivables consist of the following at December 31, 2004 and 2005:

	2004			2005
Trade	$	12,480,214		$	14,767,921
Allowance for doubtful accounts		(181,181	)		(299,781	)
Employee		106,843			76,739
Other		586,067			518,742
Total Receivables	$	12,991,943		$	15,063,621

Following are the changes in the allowance for doubtful accounts during the years ended December 31, 2003, 2004 and 2005:

	Balance at		Charged to					Acquired in		Balance at
	Beginning		Costs and					Purchase Business		End of
	of Period		Expenses			Write-offs		Combinations		Period
Allowance for Doubtful Accounts:
December 31, 2003	$	306,966	$	157,811		$	152,097	$	—	$	312,680
December 31, 2004		312,680		(40,817	)		90,682		—		181,181
December 31, 2005		181,181		163,134			138,534		94,000		299,781

F-9

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Inventories

Inventories consist of the following:

	December 31, 2004		December 31, 2005
Raw Materials	$	4,804,115	$	5,482,280
Work in Process		861,984		995,111
Finished Goods		172,799		222,892
	$	5,838,898	$	6,700,283

Inventories are stated at the lower of cost (first-in, first-out) or market. Work in process represents an estimate of the value of specific orders in production yet incomplete at period end. Finished goods consist of completed orders that were shipped to customers immediately subsequent to period end.

Property, Plant and Equipment

Property, plant and equipment are stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the following estimated depreciable lives:

Buildings	25 years
Furniture and fixtures	5 - 10 years
Laboratory equipment	5 - 20 years
Computer equipment	3 - 5 years

Leasehold improvements are amortized over the lesser of the assets’ estimated useful lives or the lease terms.

Gains and losses are recognized upon the disposal of property and equipment, and the related accumulated depreciation and amortization are removed from the accounts. Maintenance, repairs and betterments that do not enhance the value of or increase the life of the assets are charged to operations as incurred. The Company follows SFAS No. 34 “Capitalization of Interest Cost” (“SFAS No. 34”). Under SFAS No. 34, interest costs, if incurred, should be capitalized as part of the cost of acquiring or constructing qualifying assets. The Company had two qualifying assets which required a period of time to make ready for their intended use. Capitalized interest which is classified as Leasehold and Building Improvements totaled approximately $109,000 for the year ended December 31, 2005.

Depreciation expense totaled approximately $1,630,000, $1,888,000 and $2,372,000 for the years ended December 31, 2003, 2004 and 2005, respectively.

Impairment of Long-Lived Assets

At each balance sheet date, management evaluates the recoverability of the long-lived assets, including property and equipment and intangible assets, using certain financial indicators, such as historical and future ability to generate income from operations. The Company’s policy is to record an impairment loss in the period when it is determined that the carrying amount of the asset may not be recoverable. The determination is based on an evaluation of such factors as the occurrence of a significant event, a significant change in the environment in which the business operates or if the expected future undiscounted cash flows become less than the carrying amount of the asset.

Cash Surrender of Life Insurance

The cash surrender value of life insurance policies are recorded at the lower of cost or market.

F-10

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Income Taxes

The Company follows SFAS No. 109, “Accounting for Income Taxes”. Under SFAS No. 109, deferred tax assets and liabilities are recognized for the expected future tax consequences of events that have been included in the financial statements or tax returns. The amount of deferred tax asset or liability is based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

Stock Split

The Company effected a three-for-two stock split in the form of a stock dividend on its common stock paid on December 31, 2004 to stockholders of record on December 20, 2004. Stockholder’s equity has been adjusted to give retroactive recognition to the stock split for all periods presented by reclassifying from retained earnings to common stock the par value of the additional shares arising from the split. In addition, all references in the financial statements and notes to number of shares, per share amounts, stock option data and market prices have been adjusted to reflect this stock split.

Earnings Per Share

In accordance with the disclosure requirements of SFAS No. 128, “Earnings per Share,” basic earnings per share is computed by dividing net income by the weighted average number of shares outstanding and diluted earnings per share reflects the dilutive effect of stock options. The weighted average number of shares outstanding, the dilutive effects of outstanding stock options and the shares under option plans that were anti-dilutive for the years ended December 31, 2003, 2004 and 2005 are as follows:

	Years Ended December 31,
	2003		2004		2005
Weighted average number of shares used in basic earnings per share calculation		5,130,659		5,186,589		5,333,597
Incremental shares under option plans		85,363		278,517		267,844
Weighed average number of shares used in diluted earnings per share calculation		5,216,022		5,465,106		5,601,441
Shares under option plans excluded in computation of diluted earnings per share due to antidilutive effects		379,147		NONE		NONE

Stock-Based Compensation

Effective January 1, 1996, the Company adopted the disclosure provisions of SFAS No. 123, “Accounting for Stock-Based Compensation”, as amended by SFAS No. 148, “Accounting for Stock Based Compensation”. The Company has elected to continue to account for employee stock options at intrinsic value, in accordance with Accounting Principles Board (“APB”) Opinion No. 25, “Accounting for Stock Issued to Employees,” with disclosure of the effects of fair value accounting on net income and earnings per share on a pro forma basis for the years ended December 31, 2003, 2004 and 2005. Had compensation costs for the Company’s 1992 Long-Term Incentive Plan (the “LTIP”), 2001 Stock Plan and 1992 Employees’ Stock Purchase Plan (the “Stock Purchase

F-11

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Plan”) been determined consistent with SFAS No. 123, the Company’s net income and earnings per share would have been reduced to the following pro forma amounts:

	Years Ended December 31,
	2003		2004		2005
Net income, as reported:	$	5,757,045	$	5,158,832	$	7,088,818
Stock-based employee compensation expense included in reported net income		—		—		—
Deduct: Total stock-based employee compensation expense determined under fair value based method for all awards, net of related tax effects		196,840		156,554		80,149
Pro forma net income	$	5,560,205	$	5,002,278	$	7,008,669
Earnings per share:
As reported, basic	$	1.12	$	.99	$	1.33
Pro forma, basic		1.08		.96		1.31
As reported, diluted		1.10		.94		1.27
Pro forma, diluted		1.07		.92		1.25

In calculating the pro forma information set forth above, the fair value of each option grant under the LTIP, the 2001 Stock Plan and the Stock Purchase Plan is estimated as of the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in 2005, 2004 and 2003, respectively.

	Risk-Free	Weighted Average		Expected	Expected
Year Ended	Interest Rate	Expected Life		Volatility	Dividends
December 31, 2005	1.61%		1.0 Years	26.77%		None
December 31, 2004	1.04%		1.0 Years	27.17%		None
December 31, 2003	1.04% to 2.07%		1.8 Years	28.03% to 28.28%		None

Treasury Stock Purchases, Elimination & Reclassification

The Company has implemented a stock repurchase program as approved by the Company’s Board of Directors. The program authorizes the purchase of up to 300,000 shares of common stock in open market or privately negotiated transactions, subject to market conditions. In 2003 and 2004 there were no common stock repurchases; however the Company issued 3,892 shares from treasury stock in payment of directors’ fees in 2003 and 5,008 shares in 2004. There are currently 206,700 shares remaining that may be repurchased in future years.

Effective July 1, 2004, companies incorporated in Massachusetts became subject to Chapter 156D of the Massachusetts Business Corporation Act, provisions of which eliminate the concept of treasury stock and provide that shares reacquired by a company are to be treated as authorized but unissued shares. Effective for the quarter ended September 30, 2005, the Company reclassified for the balance sheets presented shares previously classified as treasury shares as a reduction to issued shares of common stock, and, accordingly, adjusted the stated value of common stock and paid in capital. At December 31, 2004 and December 31, 2003 the Company had 384,399 shares at a cost of $5,058,969 previously classified as treasury stock.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and

F-12

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reclassifications

Certain reclassifications have been made to prior year amounts to conform to the current year presentation.

Disclosures About the Fair Value of Financial Instruments

The Company’s financial instruments mainly consist of cash and cash equivalents, accounts receivable, accounts payable, and long-term liabilities. The carrying amounts of the Company’s cash and cash equivalents, accounts receivable and accounts payable approximate their fair value due to the short-term nature of these instruments. The carrying amount of the long-term liabilities also approximates their fair value, based on rates available to the Company for debt with similar terms and remaining maturities.

Comprehensive Income

SFAS No. 130, “Reporting Comprehensive Income,” requires disclosure of all components of comprehensive income on an annual and interim basis. Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. The Company’s comprehensive income is equal to its net income for all periods presented.

Disclosures about Segments of an Enterprise

SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information,” establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information for those segments to be presented in interim financial reports issued to stockholders. SFAS No. 131 also establishes standards for related disclosures about products and services and geographic areas. Operating segments are identified as components of an enterprise about which separate financial information is available for the evaluation by the chief decision maker, or decision-making group, in making decisions how to allocate resources and assess performance.

In March 2005, the Company acquired Green Dental Laboratories, Inc. of Heber Springs, Arkansas. Green is now the Company’s largest laboratory with expected sales for 2006 in excess of $16,000,000. In accordance with SFAS 131, the Company identified Green as a separate operating segment that did not meet the aggregation criteria of SFAS 131. As a result, the Company has two reportable segments. The accounting policies of this segment are consistent with those described for the consolidated financial statements in the summary of significant accounting policies.

Recent Accounting Pronouncements

In November 2004, the FASB issued SFAS No. 151, “Inventory Costs — An Amendment of ARB No. 43, Chapter 4”, (“SFAS No. 151”). SFAS No. 151 amends the guidance in Accounting Research Bulletin (ARB) No. 43, Chapter 4, “Inventory Pricing,” (“ARB No. 43”) to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage). Among other provisions, the new rule requires that items such as idle facility expense, excessive spoilage, double freight, and rehandling costs be recognized as current-period charges regardless of whether they meet the criterion of “so abnormal” as stated in ARB No. 43. Additionally, SFAS No. 151 requires that the allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities. SFAS No. 151 is effective for fiscal years beginning after June 15, 2005, and is required to be adopted by the Company effective January 1, 2006. The Company does not expect SFAS No. 151 to have a material impact on its consolidated results of operations or financial condition.

F-13

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

In December 2004, the FASB issued SFAS No. 123 (revised 2004), “Share-Based Payment”, (“SFAS No. 123R”). SFAS No. 123R supersedes APB Opinion No. 25, which requires recognition of an expense when goods or services are provided. SFAS No. 123R requires the determination of the fair value of the share-based compensation at the grant date and the recognition of the related expense over the period in which the share-based compensation vests. SFAS No. 123R permits two transition methods, the modified prospective method or the modified retrospective method. The Company will adopt SFAS No. 123R using the modified prospective method and will not adjust our prior financial statements. Under this method the Company will apply the provisions of SFAS No. 123R on new awards granted after adoption of SFAS No. 123R and unvested awards granted after December 15, 1994. Based on pro-forma financial information previously prepared for SFAS No. 123 disclosures in this Form 10K, the Company expects the impact of the adoption of SFAS No. 123R to be immaterial. The Company will continue to assess the impact SFAS No. 123R will have on any future grants.

On October 22, 2004, the President signed the American Jobs Creation Act of 2004 (the “Act”). The Act provides a deduction for income from qualified domestic production activities, which will be phased in from 2005 through 2010. In return, the Act also provides for a two-year phase-out of the existing extra-territorial income exclusion (ETI) for foreign sales that was viewed to be inconsistent with international trade protocols by the European Union. The Company expects the net effect of the phase out of the ETI and the phase in of this new deduction to result in a decrease in the effective tax rate for fiscal years 2005 and 2006 of approximately 1 percentage-point, based on current earnings levels. In the long-term, the Company expects that the new deduction will result in a decrease of the annual effective tax rate by an amount up to 3 percentage-points based on current earnings levels.

Under the guidance in FASB Staff Position No. FAS 109-1, Application of SFAS No. 109, “Accounting for Income Taxes,” to the Tax Deduction on Qualified Production Activities Provided by the Act, the deduction will be treated as a “special deduction” as described in SFAS No. 109. As such, the special deduction has no effect on deferred tax assets and liabilities existing at the enactment date. Rather, the impact of this deduction will be reported in the period in which the deduction is claimed on the Company’s tax return.

(3)   Acquisitions

The Company’s acquisition strategy is to consolidate within the dental laboratory industry and use its financial and operational synergies to create a competitive advantage. Certain factors, such as the laboratory’s assembled workforce, technical skills, and value as a going concern result in the recognition of goodwill.

In connection with certain acquisition agreements, the Company has incurred certain contractual obligations associated with deferred purchase price payments, which are not contingent on any future actions or performance measures. These deferred payments are recorded as a liability upon consummation of the acquisition and are included in the acquisition purchase price. Also, certain acquisition agreements contain provisions which require additional purchase price payments, contingent upon certain specified events. These contingent payments are recorded as an increase to goodwill upon the resolution of the contingency.

In addition, in certain transactions, the Company executes non-compete agreements with the former owners and other key employees. The fair value of these agreements is recognized in purchase accounting as an identifiable intangible asset and is amortized over the estimated economic life of the agreement. All acquisitions have been reflected in the accompanying consolidated financial statements from the date of acquisition and have been accounted for as purchase business combinations in accordance with SFAS No. 141, “Business Combinations”.

F-14

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During 2004, the Company acquired the following dental laboratory operations:

Acquisition	Form of Acquisition	Location	Period Acquired
Hamlett Dental Laboratory	Certain Assets	Holt, MI	April 2004
Dental Arts Laboratory of Dallas	Certain Assets	Dallas, TX	May 2004
G&S Dental Laboratory	Certain Assets	North Royalton, OH	July 2004
Loyd Dental Laboratory	Certain Assets	Indianapolis, IN	July 2004
Artisan Dental Studio	Certain Assets	Lakewood, CO	July 2004
D.H. Baker Dental Laboratory	All Outstanding Capital Stock	Traverse City, MI	August 2004
Crown and Glory Aesthetic Dental Laboratory	Certain Assets	Reisterstown, MD	November 2004

During 2005, the Company acquired the following dental laboratory operations:

Acquisition	Form of Acquisition	Location	Period Acquired
Wornson-Polzin Dental Laboratory	All Outstanding Capital Stock	Mankato, MN	February, 2005
Green Dental Laboratories	All Outstanding Capital Stock	Heber Springs, AR	March, 2005
Midtown-Brunswick Dental Laboratory	Certain Assets	Brunswick, ME	May, 2005

Effective March 1, 2005, the Company acquired all of the outstanding capital stock of Green Dental Laboratories, Inc. of Heber Springs, Arkansas (“Green”). Green reported sales in excess of $16,000,000 in its last fiscal year ended December 31, 2004. The cost of the acquisition, net of cash acquired, was approximately $22,325,000. In the first quarter of 2005, the total purchase price was tentatively allocated to the acquired assets and liabilities using historical allocation percentages. The allocation of purchase price has been finalized as of December 31, 2005.

Effective February 1, 2005, the Company acquired all of the outstanding capital stock of Wornson-Polzin Dental Laboratory, Inc. of Mankato, Minnesota . Effective May 1, 2005, the Company acquired certain assets of Midtown Brunswick Dental Laboratory, Inc. of Brunswick, Maine. The total purchase price for these acquisitions was not material to the consolidated financial statements and has been allocated to the acquired assets and liabilities based on estimates of their fair values.

F-15

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

These acquisitions have been reflected in the accompanying consolidated financial statements from the dates of acquisition, and have been accounted for as purchases in accordance with SFAS No. 141, “Business Combinations.” The total purchase price has been allocated to the acquired assets and liabilities based on estimates of their related fair values. The total purchase price was allocated as follows as of December 31, 2004 and 2005:

	Year Ended December 31, 2004									Year Ended December 31, 2005
	D.H. Baker									Green
	Dental						Total			Dental						Total
	Laboratory			All Other*			Acquired			Laboratories			All Other*			Acquired
Total Purchase Price	$	3,983,000		$	880,000		$	4,863,000		$	23,443,000		$	3,583,000		$	27,026,000
Less Fair Market Values Assigned to
Tangible Assets and Liabilities:
Cash		632,000			—			632,000			1,118,000			8,000			1,126,000
Accounts receivable		480,000			49,000			529,000			1,418,000			606,000			2,024,000
Inventories		113,000			45,000			158,000			595,000			156,000			751,000
Property, plant and equipment		303,000			172,000			475,000			3,592,000			243,000			3,835,000
Other assets		8,000			—			8,000			36,000			264,000			300,000
Accounts payable		(100,000	)		—			(100,000	)		(496,000	)		(28,000	)		(524,000	)
Accrued and other liabilities		(785,000	)		(25,000	)		(810,000	)		(3,850,000	)		(587,000	)		(4,437,000	)
Assumed long-term debt		—			—			—			(96,000	)		—			(96,000	)
Less Fair Market Values Assigned to Intangible Assets:
Customer relationships		800,000			—			800,000			2,900,000			699,000			3,599,000
Trade names		500,000			—			500,000			2,400,000			435,000			2,835,000
Non-compete agreements		200,000			572,000			772,000			618,000			275,000			893,000
Goodwill	$	1,832,000		$	67,000		$	1,899,000		$	15,208,000		$	1,512,000		$	16,720,000

* Certain acquisitions were individually insignificant and are presented in the aggregate.

Certain acquisition agreements contain provisions for additional payments based on earnings goals. Contingent consideration associated with the above acquisitions at time of purchase was $1,100,000 and $900,000, respectively, for all 2004 and 2005 acquisitions. The entire 2004 amount was attributable to D.H. Baker Dental Laboratory. Payments are recorded as goodwill when they are determinable. Acquired goodwill of approximately $67,000 for acquisitions completed in 2004 are tax deductible over a fifteen-year period, as allowed under Internal Revenue Service Code Section 197. Acquired goodwill for acquisitions completed in 2005 is not tax deductible.

F-16

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following unaudited pro forma operating results of the Company assume the acquisitions of 2004 and 2005 had been made as of January 1, 2004. Such information includes adjustments to reflect additional depreciation, non-compete and customer relationship amortization and interest expense, and is not necessarily indicative of what the results of operations would actually have been or of the results of operations in future periods.

	Years Ended
	December 31,		December 31,
	2004		2005
	(Unaudited)
Net sales	$	135,442,000	$	139,032,000
Net income		7,411,000		7,409,000
Net income per share:
Basic	$	1.43	$	1.39
Diluted	$	1.36	$	1.32

(4)   Goodwill and Other Intangible Assets

In July 2001, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 141, “Business Combinations” and SFAS No. 142, “Goodwill and Other Intangible Assets.” SFAS No. 141 addresses the initial recognition and measurement of goodwill and other intangible assets acquired in a business combination. SFAS No. 142 addresses the initial recognition and measurement of intangible assets acquired outside of a business combination, whether acquired individually or with a group of other assets, and the accounting and reporting for goodwill and other intangibles subsequent to their acquisition. These standards require that the purchase method of accounting be used for business combinations and eliminates the use of the pooling-of-interest method. Additionally, these standards require that goodwill and intangible assets with indefinite lives no longer be amortized. The Company was required to adopt SFAS No. 141 and SFAS No. 142 on a prospective basis as of July 1, 2001 and January 1, 2002, respectively. In accordance with the provisions of SFAS No. 142, the Company no longer amortizes goodwill.

The changes in the carrying amount of goodwill for the years ended December 31, 2004 and 2005 are as follows:

	Years Ended
	December 31, 2004		December 31, 2005
Balance as of January 1	$	27,477,000	$	30,385,000
Goodwill acquired during the year		1,899,000		16,720,000
Adjustments related to contingent consideration		814,000		1,132,000
Adjustments related to the finalization of preliminary purchase estimates		195,000		5,000
Balance as of December 31	$	30,385,000	$	48,242,000

The Company’s contingent laboratory purchase price liabilities subject to acquisition agreements that are tied to earnings performance, as defined in the purchase agreements, generally over a three year period are approximately $3,122,000. As the contingency is resolved, the payments are recorded as goodwill.

In connection with dental laboratory acquisitions, the Company has identified certain other intangible assets including trade names, customer relationships and non-competition agreements. The Company has applied the provisions of SFAS No. 141 and SFAS No. 142 as well as EITF No. 02-17 “Recognition of Customer Relationship Intangible Assets Acquired in a Business Combination” (“EITF 02-17”) in its purchase price allocations.

F-17

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Trade Names

Trade names as acquired are valued using a quantification of the income generated based on the recognition afforded by the trade name in the marketplace, using the relief-from-royalty valuation approach. Company practice is to use existing and acquired trade names in perpetuity, therefore there is no legal limit to their life and consequently they have been treated as indefinite-lived intangibles. While these assets are not subject to amortization, they are tested for impairment on an annual basis in accordance with SFAS No. 142. The Company uses the relief from royalty valuation approach at each fiscal year end to determine the value of the asset. Trade name impairment charges resulted from a decline in forecasted revenue at specific laboratories in comparison to revenue forecasts used in previous valuation calculations. In 2005, the Company recorded $10,000 in impairment charges. In 2004, the Company recorded $140,000 of impairment charges, of which $77,000, an immaterial amount, pertains to prior periods. Impairment charges are a component of selling, general and administrative expense.

The changes in the carrying amount of trade names for the years ended December 31, 2004 and 2005 are as follows:

	Years Ended
	December 31, 2004			December 31, 2005
Beginning of year	$	2,580,000		$	2,940,000
Trade names acquired during the year		500,000			2,835,000
Adjustments related to the finalization of preliminary purchase estimates		—			(121,000	)
Trade Names		3,080,000			5,654,000
Less: Charged to Impairment Expense		(140,000	)		(10,000	)
Trade Names — End of year	$	2,940,000		$	5,644,000

Customer Relationships

Acquired dental laboratories have customer relationships in place with dentists within their market areas. Based on the criteria of EITF 02-17, the Company recognizes customer relationship assets when established relationships exist with customers through contract or other contractual relationships such as purchase orders or sales orders. Customer relationships are valued based on an analysis of revenue and customer attrition data and amortized over their useful life. The weighted-average amortization period for acquisitions completed in 2004 and 2005 was 9.0 years and 11.4 years, respectively. The amounts assigned to customer relationships are amortized on a straight-line basis over their useful lives. The Company has determined that the straight-line method is appropriate based on an analysis of customer attrition statistics.

	Years Ended
	December 31, 2004			December 31, 2005
Beginning of year	$	2,143,000		$	2,943,000
Customer relationships acquired during the year		800,000			3,599,000
Adjustments related to the finalization of preliminary purchase estimates		—			121,000
Customer Relationships, Gross		2,943,000			6,663,000
Less: Accumulated amortization		(345,000	)		(944,000	)
Customer Relationships, Net — End of year	$	2,598,000		$	5,719,000

F-18

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Amortization expense associated with customer relationships totaled approximately $345,000 and $599,000 for the years ended December 31, 2004 and 2005, respectively. Future amortization expense of the current customer relationship balance will be approximately:

2006	$	679,000
2007		660,000
2008		660,000
2009		660,000
2010		660,000
Thereafter		2,400,000
	$	5,719,000

Non-competition Agreements

The Company has incurred certain deferred purchase costs relating to non-compete agreements with certain individuals, ranging over periods of 2 to 15 years, The weighted-average amortization period for acquisitions completed in 2004 and 2005 was 8.8 years and 10.7 years, respectively. The amounts assigned to non-competition agreements are amortized on a straight-line basis over the term of the agreement.

	Years Ended
	December 31,			December 31,
	2004			2005
Beginning of year	$	8,349,000		$	9,121,000
Non-competition agreements acquired during the year		772,000			893,000
Non-competition agreements, gross		9,121,000			10,014,000
Less: Accumulated amortization		(6,397,000	)		(7,342,000	)
Less: Adjustments related to the finalization of preliminary purchase estimates		—			(16,000	)
Non-competition agreements, net	$	2,724,000		$	2,656,000

Amortization expense associated with non-competition agreements totaled approximately $761,000, $886,000 and $945,000 for the years ended December 31, 2003, 2004 and 2005, respectively.

Future amortization expense of non-competition agreements will be approximately:

2006	$	823,000
2007		429,000
2008		260,000
2009		238,000
2010		229,000
Thereafter		677,000
	$	2,656,000

F-19

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(5)   Income Taxes

The following is a summary of the provision for income taxes:

	Years Ended
	December 31,			December 31,		December 31,
	2003			2004		2005
Federal —
Current	$	3,058,568		$	2,204,266	$	3,797,588
Deferred		(101,037	)		633,091		(253,942	)
		2,957,531			2,837,357		3,543,646
State —
Current		666,239			495,844		838,069
Deferred		(17,830	)		106,020		(48,010	)
		648,409			601,864		790,059
	$	3,605,940		$	3,439,221	$	4,333,705

Deferred income taxes are comprised of the following at December 31, 2004 and 2005:

	2004			2005
Deferred Tax Assets:
Non-compete agreements	$	897,672		$	1,025,603
Other liabilities		933,216			1,159,763
Vacation benefits		86,818			461,628
Inventory basis differences		45,178			182,118
Receivables basis differences		38,560			16,216
Other reserves		—			—
Total deferred tax assets		2,001,444			2,845,328
Deferred Tax Liabilities:
Depreciation differences		(1,131,242	)		(1,923,275	)
Intangible amortization differences		(3,296,287	)		(5,754,253	)
Other reserves		(302,434	)		(651,317	)
Total deferred tax liabilities		(4,729,963	)		(8,328,845	)
Net deferred tax asset/liability	$	(2,728,519	)	$	(5,483,517	)

During 2005, the Company’s marginal federal tax rate increased from 34% to 35%, as a result of taxable income in excess of $10,000,000. Accordingly, deferred tax assets and liabilities have been adjusted in accordance with SFAS No. 109. The effect of this adjustment was an increase of approximately $129,000 to the current year tax provision.

F-20

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

A reconciliation between the provision for income taxes computed at statutory rates and the amount reflected in the accompanying statements of income is as follows:

	Years Ended
	December 31,			December 31,			December 31,
	2003			2004			2005
Statutory federal income tax rate		34.0	%		34.0	%		35.0	%
State income tax, net of federal income tax benefit		4.6			4.6			4.6
Other		(0.1	)		1.4			(1.7	)
Effective income tax rate		38.5	%		40.0	%		37.9	%

(6)   Lines of Credit and Term Loan Facility

The Company executed a financing agreement (the “Agreement”) with Fleet National Bank, now known as Bank of America, N.A. (the “Bank”). The Agreement, dated June 30, 2004, included a revolving line of credit of $5,000,000 and a revolving acquisition line of credit of $20,000,000. The interest rate on both revolving lines of credit was the prime rate or, at the Company’s option, the London Interbank Offered Rate (“LIBOR”) or a cost of funds rate plus a range of .75% to 1.5% depending on the ratio of total liabilities to tangible net worth. Both revolving lines of credit were to terminate on June 30, 2007. An unused facility fee of one eighth of 1% per annum was payable on the unused amount of the first revolving line of credit. A facility fee of $10,000 per year was required on the acquisition line of credit.

On August 9, 2005, the Agreement was superceded by an Amended and Restated Agreement (the “Amended Agreement”) with the Bank, adding a five year credit facility in the form of a term loan in the principal amount of $20,000,000. Accordingly, amounts previously borrowed under the revolving acquisition line of credit were repaid under the term loan facility, creating $20,000,000 of availability under the acquisition line of credit. Additionally, certain terms and conditions of the original Agreement were amended. The interest rate on both revolving lines of credit and the term loan is now the prime rate or, at the Company’s option, LIBOR, a cost of funds rate or the Bank’s fixed rate plus a range of 1.25% to 2.25%, depending on the ratio of consolidated funded debt to consolidated “EBITDA”, as defined in the Amended Agreement. The Amended Agreement requires monthly payments of principal, based on a seven year amortization schedule, with a final payment due on the fifth anniversary of the Amended Agreement. The Amended Agreement requires compliance with certain covenants, including the maintenance of specified net worth and other financial ratios. As of December 31, 2005, $5,000,000 was available under the first line of credit and $20,000,000 was available under the acquisition line of credit.

	December 31,
	2005
Total long-term debt	$	18,701,000
Less: Current maturities		2,841,000
Long-term debt, less current portion	$	15,860,000

F-21

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The table below reflects the expected repayment terms associated with this new term loan facility at December 31, 2005. The interest rate associated with the Company’s current borrowings as of December 31, 2005 is 6.23%.

	Principal Due
Fiscal 2006		2,841,000
Fiscal 2007		2,841,000
Fiscal 2008		2,841,000
Fiscal 2009		2,841,000
Fiscal 2010		7,337,000
Total	$	18,701,000

(7)   Benefit Plans

The Company has a qualified retirement plan under Internal Revenue Code Sections 401(a) and 401(k) (the “401(k) Plan”). The 401(k) Plan allows contributions of up to 10% of a participant’s salary, a portion of which is matched in cash by the Company. The Company contributes cash once a year, within 120 days after December 31, the 401(k) Plan’s year-end. All employees are eligible to participate in the 401(k) Plan after completing one year of service with the Company and the attainment of age 21. Participants are fully vested immediately in employee contributions and become fully vested in the Company’s matching contributions after six years of service or upon attaining age 65. The Company has incurred charges to operations of approximately $586,000, $667,000 and $668,000 to match contributions for the years ended December 31, 2003, 2004 and 2005, respectively.

The Company has a cash incentive plan (the “Laboratory Plan”) for dental laboratory management and other designated key employees who could directly influence the financial performance of an individual dental laboratory. Eligibility is determined annually for each laboratory. Each participant is eligible to receive an amount based on the achievement of certain earnings levels by the participant’s laboratory, as defined. The Company has incurred charges to operations of approximately $2,790,000, $3,397,000 and $4,419,000 for the years ended December 31, 2003, 2004 and 2005, respectively, under the Laboratory Plan.

The Company has an executive bonus plan (the “Executive Plan”) for key executives and management of the Company. Eligibility to participate in this plan is determined annually. Participants are eligible to receive a payroll bonus, based on a percentage of salary, dependent upon the achievement of earnings targets, as defined. The bonus is distributed within 90 days after year-end. The Company has incurred aggregate charges to operations of approximately $304,000, $350,000 and $575,000, for the years ended December 31, 2003, 2004 and 2005, respectively, with respect to this plan.

The Company established a Supplemental Executive Retirement Plan (“SERP”) for certain key employees providing for annual benefits payable over a period of 10 years beginning at age 65 or date of retirement. Benefits are funded by life insurance contracts purchased by the Company. The cost of these benefits is being charged to expense and accrued using a present value method over the expected terms of employment. These benefits vest to the participating employees over periods of up to ten years. The charges to expense for the years ended December 31, 2003, 2004 and 2005, were approximately $479,000, $487,000 and $483,000, respectively and are recorded in accrued liabilities. The payment of benefits is funded by life insurance policies recorded in other assets.

F-22

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(8)   Commitments and Contingencies

Operating Leases

The Company is committed under various non-cancelable operating lease agreements covering its office space and dental laboratory facilities and certain equipment. Certain of these leases also require the Company to pay maintenance, repairs, insurance and related taxes. The total rental expense for the years ended December 31, 2003, 2004 and 2005 was approximately $2,937,000, $3,257,000 and $3,943,000, respectively. The approximate aggregate minimum lease commitments under these operating leases as of December 31, 2005 are as follows:

Year	Amount
2006	$	3,229,000
2007		2,544,000
2008		1,874,000
2009		1,544,000
2010		1,338,000
Thereafter		4,711,000
	$	15,240,000

Legal Proceedings

The Company is involved from time to time in litigation incidental to its business. Management believes that the outcome of current litigation will not have a material adverse effect upon the operations or financial condition of the Company and will not disrupt the normal operations of the Company.

In January 2005, the Company was served with a complaint naming them as a defendant in federal district court in a patent infringement case, PSN Illinois, LLC v. Ivoclar Vivadent, Inc. et al. The case was brought in the Eastern Division of the Northern District of Illinois. The complaint alleges that the various named defendants, including the Company and most other major domestic dental laboratories (and some companies that supply dental laboratories), infringed a patent that was assigned to the plaintiff by using, or inducing others to use, a process for making porcelain dental veneers. On March 7, 2005, the Company filed an answer with affirmative defenses to the complaint. While the Company is still in the process of further evaluating the plaintiff’s various allegations, it believes that the plaintiff can only seek monetary damages since the patent has expired, and the Company believes that it has meritorious defenses. In addition, one of the Company’s suppliers has agreed to defend and indemnify it against a portion of the plaintiff’s claims. At this time, the Company believes there is only a remote likelihood that the final disposition of this lawsuit will result in a loss, and therefore no loss provisions have been made.

The Company, as sponsor of its 401(k) Plan, has filed a retroactive plan amendment under the Internal Revenue Service’s Voluntary Correction Program to clarify the definition of compensation in the 401(k) Plan. Based on the Company’s consultation with its ERISA counsel, the Company believes this issue will be favorably resolved without requiring additional employer contributions or jeopardizing the tax-qualified status of the 401(k) Plan. The Company is also evaluating the impact of the calculation of catch-up contributions as provided for under the 401(k) Plan for the 2002 and 2003 plan years. Based on the outcome of this evaluation, the Company will determine if utilizing this voluntary correction program is required to correct the operations of the 401(k) Plan. At this time, the Company believes there is only a remote likelihood that the final disposition of this issue will result in a loss, and therefore no loss provisions have been made.

Employment Contracts and Change-in-Control Arrangements

In April 1995, January 2001 and May 2004, the Company entered into employment contracts and change-in-control arrangements with certain key executives. The initial term of these employment contracts

F-23

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

expired in April 1998, and the contracts by their terms renew automatically thereafter until termination by the Company or the executive. The change-in-control arrangements provide certain severance benefits in the event that the executive is terminated by the Company without cause or the executive terminates his employment contract for certain specified reasons.

(9)   Stock Options, Warrants and Employee Stock Purchase Plan

Stock Option Plans

In May 1992, the Company’s Board of Directors (the “Board”) adopted the 1992 Long-Term Incentive Plan (the “LTIP”). Under the LTIP, the Board may grant stock options, stock appreciation rights, restricted stock, deferred stock, stock purchase rights and other stock-based compensation to key employees, officers and directors of the Company. In August 1995, the Board amended the LTIP to increase the number of shares of common stock reserved for issuance under the plan from 225,000 to 352,500, in April 1997 to 502,500 and in April 1998 to 727,500. As of May 2002, no additional options may be granted under this plan. These options vest over three years from date of grant with a maximum term of ten years.

The following summarizes the transactions of the Company’s LTIP for the years ended December 31, 2003, 2004 and 2005:

	2003					2004					2005
				Weighted Average					Weighted Average					Weighted Average
	Shares			Exercise Price		Shares			Exercise Price		Shares			Exercise Price
Outstanding at beginning of year		533,592		$	11.78		511,953		$	11.87		449,069		$	11.95
Granted		—			—		—			—		—			—
Exercised		(14,190	)		9.06		(59,353	)		11.27		(80,917	)		11.21
Canceled		(7,449	)		10.77		(3,531	)		11.44		(8,971	)		10.97
Outstanding at end of year		511,953		$	11.87		449,069		$	11.95		359,181		$	12.14
Exercisable at end of year		451,001		$	11.59		445,020		$	11.91		359,181		$	12.14
Weighted average fair value of options granted	$	—					—					—

	Options Outstanding						Options Exercisable
	Number		Weighted Average		Weighted Average		Number		Weighted Average
	Outstanding at		Remaining		Exercise Price		Exercisable		Exercise Price
Exercise Price Range	12/31/05		Contractual Life		Per Share		at 12/31/05		Per Share
$8.17 to $10.00 per share		66,850		4.3	$	8.67		66,850	$	8.67
$10.17 to $13.42 per share		90,839		2.1		11.27		90,839		11.27
$13.50 to $16.59 per share		201,492		4.1		13.69		201,492		13.69
		359,181		3.6	$	12.14		359,181	$	12.14

In January 2001, the Company’s Board of Directors adopted the 2001 Stock Plan. Under this plan, the Board may grant stock options to key employees, officers and directors of the Company. The Board reserved 450,000 shares of common stock for issuance under the Plan. In April 2004, the Board amended the 2001 Stock

F-24

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Plan to increase the number of shares of common stock reserved for issuance under the plan from 450,000 to 825,000. These shares are available for future grants. These options vest over three years from date of grant with a maximum term of ten years.

The following summarizes the transactions of the Company’s 2001 Stock Plan for the years ended December 31, 2003, 2004 and 2005:

	2003					2004					2005
				Weighted Average					Weighted Average					Weighted Average
	Shares			Exercise Price		Shares			Exercise Price		Shares			Exercise Price
Outstanding at beginning of year		333,150		$	15.01		447,450		$	14.59		407,350		$	14.55
Granted		116,850			13.37		—			—		—			—
Exercised		—			—		(25,200	)		15.02		(41,425	)		15.04
Canceled		(2,550	)		13.96		(14,900	)		14.64		(7,000	)		13.56
Outstanding at end of year		447,450		$	14.59		407,350		$	14.55		358,925		$	14.52
Exercisable at end of year		166,134		$	14.55		289,233		$	14.53		328,741		$	14.62
Weighted average fair value of options granted	$	2.27				$	—				$	—

	Options Outstanding						Options Exercisable
	Number		Weighted Average		Weighted Average		Number		Weighted Average
	Outstanding at		Remaining		Exercise Price		Exercisable		Exercise Price
Exercise Price Range	12/31/05		Contractual Life		Per Share		at 12/31/05		Per Share
$13.01 to $13.37 per share		179,800		6.1	$	13.37		149,616	$	13.36
$13.93 to $16.45 per share		179,125		5.8		15.67		179,125		15.67
		358,925		6.0	$	14.52		328,741	$	14.62

Also, the Company has the 1992 Employees’ Stock Purchase Plan (the “Stock Purchase Plan”), as amended in April 2000, under which an aggregate of 300,000 shares of the Company’s common stock may be purchased, through a payroll deduction program, primarily at a price equal to 85% of the fair market value of the common stock on either April 1, 2004 or March 31, 2005, whichever is lower. Approximately 49,300 shares are available for future purchases as of December 31, 2005. The number of shares of common stock purchased through the Stock Purchase Plan for 2003, 2004 and 2005 were 24,529, 27,236 and 21,526, respectively.

(10)   Segment Information

The Company follows Statement of Financial Accounting Standards No. 131 (“SFAS 131”), “Disclosures about Segments of an Enterprise and Related Information”. SFAS 131 establishes standards for disclosing information about reportable segments in financial statements. Laboratory operating income includes the direct profits generated by laboratories owned by the Company and excludes general and administrative expenses of the Company’s corporate location and amortization expenses associated with the Company’s intangible assets and interest expense.

In March 2005, the Company acquired Green Dental Laboratories, Inc. of Heber Springs, Arkansas. Green is now the Company’s largest laboratory with expected sales in excess of $16,000,000 per year. In accordance with

F-25

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

SFAS 131, the Company identified Green as a separate operating segment as it met the quantitative thresholds of SFAS 131. As a result, the Company has two reportable segments. The accounting policies of this segment are consistent with those described for the consolidated financial statements in the summary of significant accounting policies.

The following table sets forth information about the Company’s operating segments for the quarter and year ended December 31, 2005. Prior to fiscal 2005, the Company had only one reportable segment.

	Three Months Ended		Year Ended
	December 31,		December 31,
	2005		2005
	(Unaudited)
Revenue:
NDX Laboratories	$	30,158,611	$	121,370,004
Green Dental Laboratory		4,200,192		14,513,115
Subtotal		34,358,803		135,883,119
Inter-segment Revenues:
Green Dental Laboratory		20,255		40,445
Net Sales	$	34,338,548	$	135,842,674
Laboratory Operating Income:
NDX Laboratories	$	3,925,999	$	19,342,502
Green Dental Laboratory		1,079,960		3,815,904
	$	5,005,959	$	23,158,406
Total Assets:
NDX Laboratories	$	81,747,877	$	81,747,877
Green Dental Laboratory		26,889,263		26,889,263
Corporate		8,481,870		8,481,870
	$	117,119,010	$	117,119,010
Capital Expenditures:
NDX Laboratories	$	2,544,041	$	6,533,065
Green Dental Laboratory		33,311		86,529
Corporate		259,256		958,819
	$	2,836,608	$	7,578,413
Depreciation & Amortization on Property, Plant & Equipment:
NDX Laboratories	$	462,767	$	1,625,370
Green Dental Laboratory		45,971		205,183
Corporate		214,372		541,878
	$	723,110	$	2,372,431

F-26

NATIONAL DENTEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Reconciliation of Laboratory Operating Income with reported Consolidated Operating Income:

	Three Months Ended		Year Ended
	December 31,		December 31,
	2005		2005
Laboratory Operating Income	$	5,005,959	$	23,158,406
Less:
Corporate Selling, General and Administrative Expenses		2,496,362		9,503,542
Amortization Expense — Intangible Assets		379,275		1,567,233
Add:
Other Expense		284,002		646,436
Consolidated Operating Income	$	2,414,324	$	12,734,067

(11)   Subsequent Events

In January, 2006, the Company’s Board of Directors approved an amendment to the 2001 Stock Plan to allow for the issuance of restricted stock and restricted stock units, in addition to incentive stock options, subject to shareholder approval at our annual meeting of stockholders scheduled to be held on May 16, 2006.

On March 15, 2006, the Company finalized the sale of its former laboratory facility in Houston, Texas. The land, building and related improvements are classified as assets held for sale as of December 31, 2005, with a carrying value of approximately $509,000. The net proceeds from the transaction resulted in a gain of approximately $390,000, which will be recorded as operating income in the first quarter of 2006.

F-27

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

NATIONAL DENTEX CORPORATION

By:  /s/  DAVID L. BROWN

David L. Brown, President & CEO

March 16, 2006

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/  DAVID V. HARKINS David V. Harkins	Chairman of the Board and Director	March 16, 2006
/s/  JACK R. CROSBY JACK R. CROSBY	Director	March 16, 2006
/s/  THOMAS E. CALLAHAN Thomas E. Callahan	Director	March 16, 2006
/s/  NORMAN F. STRATE Norman F. Strate	Director	March 16, 2006
/s/  DAVID L. BROWN David L. Brown	President, CEO, and Director (Principal Executive Officer)	March 16, 2006
/s/  RICHARD F. BECKER, JR. Richard F. Becker, Jr.	Executive Vice President, Treasurer and Chief Financial Officer (Principal Financial Officer)	March 16, 2006

F-28

EXHIBIT INDEX

Exhibit No.			Description of Exhibit
	3	.1(6)	Restated Articles of Organization of the Company, filed with the Massachusetts Secretary of State on October 14, 1993.
	3	.2(6)	Articles of Amendment, filed with the Massachusetts Secretary of the Commonwealth on September 26, 1995.
	3	.3(6)	By-Laws of the Company, as amended on December 31, 1982 and May 26, 1992.
	10	.1(1)*	Amended & Restated 2001 Stock Plan, as amended on April 10, 2001.
	10	.2(3)*	Change of Control Severance Agreement between the Company and David L. Brown, dated January 23, 2001.
	10	.3(3)*	Form of Change of Control Severance Agreements between the Company and each of Arthur Champagne, Richard G. Mariacher and Donald E. Merz dated January 23, 2001, and Lynn D. Dine dated May 1, 2004.
	10	.4(4)*	Employment Agreement between the Company and Donald E. Merz, dated November 1, 1983.
	10	.5(2)*	1992 Long-Term Incentive Plan, as amended.
	10	.6(2)*	Employment Agreement between the Company and Richard F. Becker, Jr., dated April 1, 1995.
	10	.7(2)*	Change of Control Severance Agreement between the Company and Richard F. Becker, Jr., dated April 1, 1995.
	10	.8(2)*	Employment Agreement between the Company and David L. Brown, dated April 1, 1995.
	10	.9*	National Dentex Corporation Laboratory Incentive Compensation Plan, dated May 17, 2001.
	10	.10*	National Dentex Corporation 2006 Key Employee and Corporate Support Group Incentive Compensation Plan.
	10	.11*	National Dentex Corporation Employees’ Stock Purchase Plan, as amended effective April 4, 2000.
	10	.12(5)	Amended and Restated Loan Agreement by and between Bank of America, N.A., and National Dentex Corporation and Green Dental Laboratories, Inc. dated August 9, 2005.
	10	.13*	National Dentex Supplemental Executive Retirement Plan
	10	.14*	National Dentex Supplemental Laboratory Executive Retirement Plan.
	21		Subsidiaries of the Company.
	23		Consent of PricewaterhouseCoopers LLP.
	31	.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act (Chief Executive Officer).
	31	.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act (Chief Financial Officer).
	32	.1	Certification pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act (Chief Executive Officer).
	32	.2	Certification pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act (Chief Financial Officer).
Unless otherwise noted, all exhibits are filed herewith
* These exhibits relate to a management contract or to a compensatory plan or arrangement.

(1)	Incorporated by reference from the Registration Statement on Form S-8 (File No. 333-66446) as filed with the Commission on August 1, 2001.
(2)	Incorporated by reference from the Form 10-K for the fiscal year ended December 31, 2003 (File No. 000-23092) as filed with the Commission on March 12, 2004.
(3)	Incorporated by reference from the Form 10-K for the fiscal year ended December 31, 2000 (File No. 000-23092) as filed with the Commission on March 13, 2001.
(4)	Incorporated by reference from the Form 10-K for the fiscal year ended December 31, 1999 (File No. 000-23092) as filed with the Commission on March 3, 2000.
(5)	Incorporated by reference from the Current Report on Form 8-K (File No. 000-23092) as filed with the Commission on August 15, 2005.
(6)	Incorporated by reference from the Annual Report on Form 10-K (File No. 000-23092) as filed with the Commission on May 24, 2005.

EX-10.9

                                                                    Exhibit 10.9

                          NATIONAL DENTEX CORPORATION

                                   LABORATORY

                             INCENTIVE COMPENSATION

                                      PLAN

                                                                    MAY 17, 2001



                          NATIONAL DENTEX CORPORATION

                     LABORATORY INCENTIVE COMPENSATION PLAN

OBJECTIVE:

To motivate individual performance and group teamwork directed toward superior
results in terms of:

     -    Increased sales volume,

     -    Maximum profit contribution through efficient operation and
          management, and

     -    Career path development and job satisfaction for the laboratory's
          personnel.

ELIGIBLE INDIVIDUALS:

Laboratory Presidents, supervisory management, and other designated key
employees.

INCENTIVE COMPENSATION POOL:

A pool will be created, consisting of 30% (or other % designated by the Company)
of that portion of the operating income of the laboratory, which exceeds a
"base" equal to 9 1/2% of net revenues exclusive of inter-company sales.

Operating income is defined as income before Division and corporate allocations.

                                    Example:

                                
Total Sales                        $1,005,000
Less: Inter-company sales               5,000
                                   ----------
Net Sales                           1,000,000
                                   ----------
Operating Income                      200,000
Less: Base (9 1/2% of net sales)       95,000
                                   ----------
Excess                                105,000
Pool (30% of excess)               $   31,500
                                   ==========





DISTRIBUTION OF THE POOL:

FIXED PERCENTAGE PORTION:

Fixed shares, stated as a percent of the pool, are to be determined at the start
of the year and each designated participant is to be informed so that he or she
can work toward a visible goal.

LABORATORY PRESIDENTS:

Laboratory Presidents will be assigned between 10% and 25% of the pool as agreed
upon by the Laboratory President and Group Manager with approval of the Company
President. This percent will be arrived at considering the size of the
laboratory and its organization.

The Laboratory President's earned bonus will be 25% held back for further review
and thus only 75% will be distributed quarterly (see Distribution schedule
below).

The distribution of the held back portion of the Laboratory President's earned
bonus will be based on criteria other than financial, such as:

     -    Laboratory revenue growth,

     -    Market size, penetration, and competition,

     -    Personnel stability and development,

     -    Accuracy and timeliness in Corporate planning process,

     -    Involvement in Corporate programs, i.e. materials purchasing, accounts
          receivable and inventory controls, asset management, recruiting,
          training, and new product introduction and promotion.

Any Laboratory President's portion unpaid will revert to the Company. It will
not be available for distribution within the laboratory.

SUPERVISORY MANAGEMENT AND OTHER KEY EMPLOYEES:

All other fixed percentages, not more than 90% of the pool (including the
Laboratory President's %) shall be assigned to key personnel at the beginning of
each year, based on their overall contribution and responsibility levels. These
percentages may be changed during the year to reflect organizational or
operational changes, but only with the approval of the Laboratory President,
Group Manager, and Company President.

These other fixed participants earned bonus will be 25% held back for further
review and thus only 75% will be distributed quarterly (see Distribution
Schedule below).

The Laboratory President will make recommendations regarding the distribution of
the held back portion to the Group Manager, with final approval by the Company
President.

Any other fixed participant's portion unpaid will revert to the Discretionary
Pool for distribution to personnel within the laboratory.


DISCRETIONARY PORTION:

The remaining portion of the pool (at least 10%) will be reserved for the
discretionary distribution of the Laboratory President with the approval of the
Group Manager.

These awards will be to employees not otherwise designated in the Plan who make
exceptional contributions to the success of the laboratory.

None of this amount may be used to supplement the share of any individual
already receiving a fixed percentage distribution.

ADMINISTRATIVE PROVISIONS:

Shares will be calculated annually on the basis of the full years audited
operating results, and distributed promptly once these have been determined.

Quarterly progress payments will be paid, to be applied toward the annual
operating results according to the Distribution Schedule below. These
distributions will be made on the payroll following the 45th day after the end
of each quarter.

Eligibility of a participant to receive a full, or partial share requires
continuous employment with National Dentex Corporation. Promotion, transfer
within the Company, or retirement does not terminate eligibility. Distribution
to any participant in these categories is prorated to that portion of the year
he is employed in a position covered by the Plan.

In the event an individual terminates or has given notice of termination and
therefore forfeits participation, any earned and or unpaid shares will revert to
the Company.

Any deviation from the Plan requires the approval of the Company President.

This Plan may be revoked or revised by the Company, at any time, and does not
constitute a legally binding commitment or right of employment.



                             DISTRIBUTION SCHEDULE



                                                                     Distribution (on or about)
Eligible                                          ----------------------------------------------------------------
Participant                Share      Approval      May 15       Aug 15       Nov l5               Feb 15
- -----------              ---------   ----------   ----------   ----------   ----------   -------------------------
                                                                       
FIXED PORTION:

Laboratory               %assigned      Group       75% of       75% of       75% of       100% of  and   25% of
President                              Manager      Qtr. 1       Qtr. 2       Qtr. 3       Qtr. 4        Qtr. 1- 3
                                         and        earned       earned       earned       earned         earned
                                       Company
                                      President

Supervisor or other      %assigned   Laboratory     75% of       75% of       75% of       100% of  and   25% of
Key Employee                         President,     Qtr. 1       Qtr. 2       Qtr. 3       Qtr. 4        Qtr. 1- 3
                                        Group       earned       earned       earned       earned         earned
                                       Manager
                                         and
                                       Company
                                      President

DISCRETIONARY PORTION:

Other                     $ award    Laboratory       75%          75%          75%         100%    and     25%
Employees                             President       of           of           of           of             of
                                         and        Qtr. 1       Qtr. 2       Qtr. 3       Qtr. 4        Qtr. 1-3
                                        Group       earned       earned       earned       earned         earned
                                       Manager        is           is           is           is             is
                                                   available    available    available    available      available
                                                      to           to           to           to             to
                                                  distribute   distribute   distribute   distribute     distribute

EX-10.10

                                                                   Exhibit 10.10

                           NATIONAL DENTEX CORPORATION
                     KEY EMPLOYEE & CORPORATE SUPPORT GROUP
                           INCENTIVE COMPENSATION PLAN

                         PRINCIPAL FEATURES OF THE PLAN

Participation in the Plan

At the start of each plan year, the Compensation Committee of the Board of
Directors of National Dentex Corporation shall select who will participate in
the Plan for that year.

Standard Bonus

The standard bonus, as used herein, represents the percentage of Base Salary
that is applicable to a National Dentex executive based upon his/her corporate
responsibilities.

Determination of Participant's Bonus

Participants in the Plan will earn incentive compensation based on the
attainment of corporate earnings targets, expressed in terms of Net Income
before taxes and consistent with the Company's budget.

Other Provisions

     1.   Standard bonuses calculated as a percentage of base salary, will use
          for that calculation, annualized salary earnings in effect at the end
          of the Plan Year.

     2.   Bonus payments will be calculated annually based on audited operating
          results and distributed within 90 days of the close of the Company's
          fiscal year.

     3.   The bonus payment will be determined based upon the following: 1/3
          attributable to corporate performance, 1/3 to the individuals specific
          group performance and 1/3 attributable to the individuals overall
          performance as subjectively reviewed by the President and the Board of
          Directors Compensation Committee.

     4.   Eligibility of a participant to receive a full, or a partial bonus
          requires continuous employment within National Dentex Corporation to
          the date actual bonus distributions are made.

     5.   New hire status, promotion, transfer, retirement, disability or death
          does not eliminate or terminate eligibility, and distribution to any
          participant or beneficiary in this category is pro-rated to that
          portion of the year employed in a position covered by the Plan.

     6.   This Plan may be revoked or revised at any time, in total or as it
          applies to any individual whose performance is unsatisfactory, by the
          Board of Directors and does not constitute a legally binding
          commitment. Any deviation from the Plan requires approval of the
          National Dentex Corporation Compensation Committee.

EX-10.11

                                                                   Exhibit 10.11

ACK00AC1
October 14, 1993

                           NATIONAL DENTEX CORPORATION

                         EMPLOYEES' STOCK PURCHASE PLAN

              Adopted by the Board of Directors as of May 22, 1992

     1. Purpose of the Plan. The Plan is intended to encourage ownership of
Common Stock by employees of the Company and to provide additional incentive for
employees to promote the success of the business of the Company by enabling
Eligible Employees to purchase shares of Common Stock at a discount from market
value through a payroll deduction program. Any Eligible Employee who wishes to
participate in the Plan may authorize the Company to withhold a percentage of
his or her Gross Compensation (not to exceed the maximum percentage specified by
the Company) through payroll deductions, for a specified period of time, and, at
the end of such period, use such accumulated payroll deductions to purchase
shares of Common Stock of the Company. It is intended that the Plan shall be an
"employee stock purchase plan" within the meaning of Section 423 of the Code.

     2. Definitions. As used in the National Dentex Corporation Employees' Stock
Purchase Plan, the following terms shall have the meanings respectively assigned
to them below:

     (a) Beneficiary means the person designated as beneficiary on the
Optionee's Membership Agreement or, if no such beneficiary is named, the person
to whom the Option is transferred by will or under the applicable laws of
descent and distribution.

     (b) Board means the Board of Directors of the Company.

     (c) Code means the Internal Revenue Code of 1986, as amended.

     (d) Company means National Dentex Corporation, a Massachusetts corporation.

     (e) Common Stock means the Common Stock, $.01 par value, of the Company.

     (f) Eligible Employee means a person who is eligible under the provisions
of Section 7 to receive an Option as of a particular Grant Date.

     (g) Exercise Date means a date not less than six months and not more than
one year after a Grant Date, as determined by the Board, on which Options must,
if ever, be exercised.

     (h) Grant Date means a date specified by the Board on which Options are to
be granted to Eligible Employees.

     (i) Gross Compensation means base compensation plus commissions, overtime
pay and cash bonuses.

     (j) Market Value means, as of a particular date, the last sale price of the
Common Stock if such Common Stock is reported on a stock exchange, or if not so
reported, the average of bid and asked prices of the Common Stock last quoted by
NASDAQ in the over-the-counter market on such date.

     (k) Membership Agreement means an agreement whereby an Optionee authorizes
the Company to withhold payroll deductions from his or her Gross Compensation.

     (l) 1934 Act means the Securities Exchange Act of 1934, as amended.



ACK00AC1
October 14, 1993

1    (m) Option means an option to purchase Option Shares granted under the
Plan.

     (n) Option Shares means shares of Common Stock purchasable under an Option.

     (o) Optionee means an Eligible Employee to whom an Option is granted.

     (p) Plan means this National Dentex Corporation Employees' Stock Purchase
Plan, as the same may be amended from time to time.

     (q) Rule 16b-3 means Rule 16b-3 promulgated under Section 16 of the 1934
Act, as amended.

     (r) Section 16 means Section 16 of the 1934 Act, as amended.

     3. Term of the Plan. The Plan shall become effective on July 1, 1992 and
shall terminate on July 1, 2002, unless sooner terminated by the Board pursuant
to Section 5 hereof.

     4. Administration of the Plan. The Plan shall be administered by the Board,
which annually shall determine whether to grant Options under the Plan, shall
specify which dates shall be Grant Dates and Exercise Dates, and shall fix the
respective maximum percentages of each Optionee's Gross Compensation which may
be withheld for the purpose of purchasing Option Shares, provided that such
percentage shall not exceed ten percent of such Optionee's Gross Compensation.
The Board shall have authority to interpret the Plan, to prescribe, amend and
rescind rules and regulations relating to the Plan, to determine the terms of
Options granted under the Plan, and to make all other determinations necessary
or advisable for the administration of the Plan.

     The Board may appoint a committee of three or more directors, who shall
each serve at the pleasure of the Board, to administer the Plan on behalf of the
Board, subject to such terms and conditions as the Board may prescribe. The
Board, in its sole and absolute discretion, may designate any or all of the
functions specified herein regarding administration of the Plan to such
committee.

     With respect to an Optionee subject to Section 16 (a "Section 16
Optionee"), transactions under the Plan are intended to comply with all
applicable conditions of Rule 16b-3 (or its successors). To the extent any
provision of the Plan or action by the Board with respect to the Plan fails to
so comply, it shall be deemed null and void.

     5. Termination and Amendment of Plan. The Board may terminate or amend the
Plan at any time; provided, however, that no amendment, unless approved by the
holders of a majority of the issued and outstanding shares of Common Stock,
shall be effective if it would cause the Plan to fail to satisfy the
requirements of Rule 16b-3 (or its successors); and, provided further, that (i)
any increase in the aggregate number of shares that may be issued under the
Plan, other than an increase merely reflecting a capital change referred to in
Section 9.8, and (ii) any change in the designation of corporations whose
employees may be offered Options (other than a change designating as a
participating corporation any corporation that becomes a parent or subsidiary
corporation of the Company, within the meaning of Code Section 424(e) and (f),
after the adoption of the Plan), must, in order to be effective, be approved by
a majority of the issued and outstanding shares of Common Stock. No termination
of or amendment to the Plan may adversely affect the rights of an Optionee with
respect to any Option held by the Optionee as of the date of such termination or
amendment.

     6. Shares of Stock Subject to the Plan. No more than an aggregate of
100,000 shares of Common Stock may be issued or delivered pursuant to the
exercise of Options granted under the Plan, subject to adjustments made in
accordance with Section 9.8. Option Shares may be either shares of Common Stock


                                       -2-


ACK00AC1
October 14, 1993

which are authorized but unissued or shares of Common Stock held by the Company
in its treasury. If an Option expires or terminates for any reason without
having been exercised in full, the unpurchased Option Shares shall become
available for other Options granted under the Plan. The Company shall, at all
times during which Options are outstanding, reserve and keep available shares of
Common Stock sufficient to satisfy such Options and shall pay all fees and
expenses incurred by the Company in connection therewith. In the event of any
capital change in the outstanding Common Stock as contemplated by Section 9.8,
the number of Option Shares reserved and kept available by the Company shall be
appropriately adjusted.

     7. Persons Eligible to Receive Options. Each employee of the Company shall
be granted an Option on each Grant Date on which such employee meets all of the
following requirements:

     (a) The employee has completed at least two years of continuous employment
with the Company. Employment shall include any leave of absence for military
service, illness or other bona fide purpose which does not exceed the longer of
90 days or the period during which the absent employee's reemployment rights are
guaranteed by statute or contract.

     (b) The employee is customarily employed by the Company for more than 20
hours per week and for more than five months per calendar year.

     (c) The employee will not, immediately after grant of the Option, own stock
possessing five percent or more of the total combined voting power or value of
all classes of stock of the Company. For purposes of this paragraph (c), the
rules of Section 424(d) of the Code shall apply in determining the stock
ownership of the employee, and stock which the employee may purchase under
outstanding options shall be treated as stock owned by the employee.

     (d) Upon grant of the Option, the employee's rights to purchase Common
Stock under all employee stock purchase plans (as defined in Section 423(b) of
the Code) of the Company will not accrue at a rate which exceeds $25,000 of fair
market value of the Common Stock (determined as of the Grant Date for such
Option) for each calendar year in which such Option is outstanding at any time.
The accrual of rights to purchase Common Stock shall be determined in accordance
with Section 423(b)(8) of the Code.

     8. Dates for Granting Options. Options shall be granted on each date
designated by the Board as a Grant Date.

     9. Terms and Conditions of Options.

     9.1. General. All Options granted on a particular Grant Date shall comply
with the terms and conditions set forth in Sections 9.3 through 9.13, and each
Option shall be identical except as to the number of Option Shares, which shall
be determined in accordance with Section 9.2.

     9.2. Number of Shares. The maximum number of Option Shares shall be an
amount equal to the amount of the Optionee's Gross Compensation permitted to be
withheld during the period running from the Grant Date to the Exercise Date,
divided by the purchase price determined in accordance with Section 9.3. The
number of Option Shares shall further limited by the amount of payroll
deductions actually withheld as of the Exercise Date.

     9.3. Purchase Price. For Optionees who are not subject to Section 16, the
purchase price of Option Shares shall be 85 percent of the lesser of (a) the
Market Value of the Common Stock as of the Grant Date, or (b) the Market Value
of the Common Stock as of the Exercise Date. For Section 16 Optionees, the
purchase price of Option Shares shall be 85 percent of the average of (i) the
Market Value of the Common Stock as of the Grant Date and (ii) the Market Value
of the Common Stock as of the Exercise Date.


                                       -3-



ACK00AC1
October 14, 1993

     9.4. Restrictions on Transfer. Options may not be transferred otherwise
than by will or under the laws of descent and distribution, or pursuant to a
qualified domestic relations order, as defined by the Code, or Title I of the
Employee Retirement Income Security Act ("ERISA") or the rules thereunder. An
Option may not be exercised by anyone other than the Optionee during the
lifetime of the Optionee.

     9.5. Expiration. Each Option shall expire at the close of business on the
Exercise Date for such Option or on such earlier date as may result from the
operation of Section 9.6.

     9.6. Termination of Employment of Optionee. If an Optionee ceases for any
reason, voluntary or involuntary (other than death or retirement), to be
continuously employed by the Company, his or her Options shall immediately
expire, and the Optionee's accumulated payroll deductions shall be returned by
the Company with interest pursuant to Section 9.13. For purposes of this Section
9.6, an Optionee shall be deemed to be employed throughout any leave of absence
for military service, illness or other bona fide purpose which does not exceed
the longer of ninety days or the period during which the Optionee's reemployment
rights are guaranteed by statute or by contract. If the Optionee does not return
to active employment prior to the termination of such period, his or her
employment shall be deemed to have ended on the 91st day of such leave of
absence.

     9.7. Retirement or Death of Optionee. If an Optionee retires or dies, the
Optionee or, in the case of death, his or her Beneficiary, shall be entitled to
withdraw the Optionee's accumulated payroll deductions with interest pursuant to
Section 9.13, or to purchase Option Shares on the Exercise Date to the extent
that the Optionee would have been so entitled had he or she continued to be
employed by the Company. The number of Option Shares purchasable shall be
limited by the amount of the Optionee's accumulated payroll deductions as of the
date of his or her retirement or death. Accumulated payroll deductions not
withdrawn or applied to the purchase of Option Shares shall be delivered by the
Company to the Optionee or Beneficiary, as the case may be, with interest
pursuant to Section 9.13, within a reasonable time after the Exercise Date.

     9.8. Capital Changes Affecting the Stock. In the event that, between the
Grant Date and the Exercise Date of an Option, a stock dividend is paid or
becomes payable in respect of the Common Stock or there occurs a split-up or
contraction in the number of shares of Common Stock, the number of Option Shares
and the price to be paid for each Option Share shall be proportionately
adjusted. In the event that, after the Grant Date, there occurs a
reclassification or change of outstanding shares of Common Stock or a
consolidation or merger of the Company with or into another corporation or a
sale or conveyance, substantially as a whole, of the property of the Company,
the Board may, in its discretion, (i) accelerate the Exercise Date of any
Options outstanding, or (ii) terminate any such outstanding Options. Unless
terminated in accordance with this section, Optionees shall be entitled on the
Exercise Date to receive shares of stock or other securities equivalent in kind
and value to the shares of Common Stock he or she would have held if he or she
had exercised the Option in full immediately prior to such reclassification,
change, consolidation, merger, sale or conveyance and had continued to hold such
shares (together with all other shares and securities thereafter issued in
respect thereof) until the Exercise Date. In the event that there is to occur a
recapitalization involving an increase in the par value of the Common Stock
which would result in a par value exceeding the exercise price under an
outstanding Option, the Company shall notify the Optionee of such proposed
recapitalization immediately upon its being recommended by the Board to the
Company's shareholders, after which the Optionee shall have the right to
exercise his or her Option prior to such recapitalization; if the Optionee fails
to exercise the Option prior to recapitalization, the exercise price under the
Option shall be appropriately adjusted. In the event that, after the Grant Date,
there occurs a dissolution or liquidation of the Company, except pursuant to a
transaction to which Section 424(a) of the Code applies, each Option shall
terminate, but the Optionee holding such Option shall have the right to exercise
his or her Option prior to such dissolution or liquidation.


                                       -4-


ACK00AC1
October 14, 1993

     9.9. Payroll Deductions; Withdrawal from Plan Prior to Exercise Date. Any
Eligible Employee who has completed at least two years of service with the
Company, and who wishes to authorize payroll deductions for the purchase of
Option Shares under the Plan, must complete and return to the personnel
department of the Company at anytime on or before the Grant Date a Membership
Agreement indicating the total percentage (which shall be a full integer between
one and ten) of his or her Gross Compensation which is to be withheld each pay
period, not to exceed the maximum percentage, if any, set by the Board in its
discretion. Payroll deductions will commence as of the first Grant Date after
receipt of such Membership Agreement by the personnel department. Prior to the
Exercise Date, each Optionee shall, except as provided by Section 9.11(d)
hereof, be permitted only once to (a) withdraw all or part of his or her
accumulated payroll deductions, (b) discontinue payroll deductions, or (c)
change the percentage of Gross Compensation withheld.

     9.10. Compliance with Rule 16b-3. The purchase of Option Shares under the
Plan by a Section 16 Optionee shall be exempt from Section 16(b) of the 1934 Act
If the Section 16 Optionee complies with the requirements of either subparagraph
(a) or (b) below.

     (a) Irrevocable Election. The Section 16 Optionee waives the right to
withdraw from the Plan granted in Section 9.9, and makes an irrevocable election
in the Membership Agreement to participate in the Plan on the terms and
conditions set forth in the Membership Agreement at least six months prior to
the Exercise Date. Optionees who make such an irrevocable election may change
the terms of such Membership Agreement, but any such change will not take effect
for six months.

     (b) Transactional Requirements.

          (1)  Six-Month Holding Period. The Section 16 Optionee agrees to hold
               any Option Shares purchased under the Plan for at least six
               months from the date the Option Price for such Option Shares was
               fixed; and

          (2)  Cessation of Participation. The Section 16 Optionee who (i)
               voluntarily decides to cease participation in the Plan
               (excluding a cessation necessitated by the limit on stock
               ownership and accrual restrictions imposed by the Code) or (ii)
               withdraws accumulated payroll deductions prior to the Exercise
               Date, may not participate in the Plan again for at least six
               months; provided, however, that the following shall not
               constitute a cessation of participation: (x) a decision to
               increase or decrease the amount of payroll deductions or (y) a
               decision to continue enrollment in the Plan at a more favorable
               basis price. A Section 16 Optionee may not authorize a nominal
               amount of payroll deductions to avoid the penalty for cessation
               provided for herein.

     9.11. Exercise of Options. On the Exercise Date the Optionee will be deemed
to have exercised his or her Option and thereby purchased the number of Option
Shares purchasable by his or her accumulated payroll deductions, provided that:

     (a) The number of Option Shares shall not exceed the number of shares the
Optionee is entitled to purchase pursuant to Section 9.2.

     (b) If the total number of Option Shares which all Optionees have been
deemed to purchase, together with any Option Shares already purchased under the
Plan, exceeds the total number of shares of Common Stock subject to the Plan
pursuant to Section 6, the number of Option Shares which each Optionee is deemed
to have purchased shall be decreased PRO RATA based on the Optionee's
accumulated payroll deductions with respect to such Option Shares in relation to
all accumulated payroll deductions currently being withheld under the Plan with
respect to such Option Shares.


                                       -5-



ACK00AC1
October 14, 1993

     (c) If the number of Option Shares includes a fraction, such number shall
be adjusted to the next smaller whole number and the purchase price shall be
adjusted accordingly.

     (d) Notwithstanding the foregoing, any Optionee may notify the Company's
payroll department in writing, not later than two weeks prior to the Exercise
Date, that he or she elects not to exercise his or her Option in full or in
part, and desires to receive that portion of his or her accumulated payroll
deductions withheld under the Plan and not used to purchase Option Shares in the
form of cash, with interest pursuant to Section 9.13, instead of Option Shares.

     As a condition to the exercise of an Option, the Company may require the
person exercising such Option to represent and warrant at the time of any such
exercise that the Option Shares are being purchased only for investment and
without any present intention to sell or distribute such Option Shares if, in
the opinion of counsel for the Company, such a representation is required by the
Securities Act of 1933, as amended (the "1933 Act"), the 1934 Act, and the rules
and regulations promulgated thereunder.

     9.12. Delivery of Stock. Within a reasonable time after the Exercise Date,
the Company shall deliver or cause to be delivered to each Optionee a
certificate or certificates for the number of Option Shares purchased by such
Optionee. If any law or applicable regulation of the Securities and Exchange
Commission or other body having jurisdiction in the premises shall require that
the Company or the Optionee take any action in connection with the Option
Shares, delivery of the certificate or certificates for such Option Shares shall
be postponed until the necessary action shall have been completed, which action
shall be taken by the Company at its own expense, without unreasonable delay.
The Optionee shall have no rights as a shareholder in respect of Option Shares
for which he or she has not received a certificate.

     The Company shall have the right to impose restrictions on the
transferability of Option Shares, and to place appropriate legends on all stock
certificates setting forth any such restrictions on transferability of Option
Shares instructing the transfer agent to notify the Company of any transfer of
the Option Shares. Shares shall not be issued pursuant to the exercise of an
Option unless the exercise of such Option and the issuance and delivery of such
Option Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the 1933 Act, the 1934 Act, the rules and
regulations promulgated thereunder, the so-called state "blue sky" or securities
laws, and the requirements of the National Association of Securities Dealers or
of any stock exchange upon which the Shares may be listed (as the case may be),
and shall be further subject to the approval of counsel for the Company with
respect to such compliance.

     9.13. Return of Accumulated Payroll Deductions. In the event that the
Optionee or the Beneficiary is entitled to the return of accumulated payroll
deductions, whether by reason of voluntary withdrawal, termination of
employment, retirement, death, or in the event that accumulated payroll
deductions exceed the price of Option Shares purchased, such amount, together
with interest thereon at the rate of 6 percent, shall be returned within a
reasonable time by the Company to the Optionee or the Beneficiary, as the case
may be; PROVIDED, HOWEVER, that interest shall not be paid on any amount
returned which is less than the purchase price of one Option Share for which
such payroll deductions were withheld.


                                       -6-



AMENDMENT TO NATIONAL DENTEX CORPORATION 1992 EMPLOYEE'S STOCK PURCHASE PLAN

The first sentence of Section 6 of the Plan has been amended (effective as of
Shareholder approval of the Amendment on April 4, 2000) to read in its entirety
as follows: "No more than an aggregate of 200,000 shares of Common Stock may be
issued or delivered pursuant to the exercise of options under the Plan, subject
to adjustments made in accordance with Section 9.8."

EX-10.13

                                                                   Exhibit 10.13

                           NATIONAL DENTEX CORPORATION

                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

This Plan is effective as of the 4th day of April 1995, and is established by
National Dentex Corporation, organized and existing under the laws of the
Commonwealth of Massachusetts (hereinafter referred to as the "Company"), and is
binding upon the Company and those persons who are eligible to become
participants hereunder and have elected to do so by executing a Participation
Agreement (hereinafter referred to as "Participant" and collectively as the
"Participants").

     WITNESSETH THAT:

     WHEREAS, the Participants are employed by the Company; and

     WHEREAS, the Participants have performed their duties in a capable and
efficient manner, resulting in growth and progress of the Company; and

     WHEREAS, the experience of each Participant is such that assurance of his
continued service is desirous to further growth of the Company; and

     WHEREAS, the parties hereto desire to arrange compensation in a different
manner to more effectively provide for each Participant's retirement or death.

     NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and
agreements hereinafter contained, and other good and valuable consideration,
receipt of which is hereby acknowledged, the Company hereby establishes the
National Dentex Corporation Supplemental Employee Retirement Plan as follows:

                                    ARTICLE I
                                   DEFINITIONS

1.1 "BENEFICIARY" shall mean any person, corporation, trust or other combination
of these, last designated in writing by a Participant to receive benefits
provided under this Plan. Such designation shall be filed with the Company and
shall be revocable at any time through written instruments similarly filed
without consent of any "Beneficiary". In the absence of any designation, the
benefits payable hereunder shall be delivered by the Company to the Executor(s)
or Administrator(s) of the Participant's estate.

1.2 "BOARD OF DIRECTORS" shall mean the Board of Directors of the Company.

1.3 "CLERK" shall mean the Clerk of the Company.

1.4 "COMMITTEE" shall mean the Executive Compensation Committee of the Board of
Directors.

1.5 "COMPANY" shall mean National Dentex Corporation.

1.6 "PARTICIPANT" shall mean any person designated by the Committee who elects
to participate in the Plan through execution of the Participation Agreement.


                                       1



1.7 "PARTICIPATION AGREEMENT" shall mean the form of written agreement, attached
hereto as Schedule A, which is entered into by and between the Company and a
Participant as a condition to participation in the Plan.

1.8 "RETIREMENT", "RETIRE", AND "RETIREMENT DATE" shall mean the date on which a
Participant attains the age sixty-five (65) or such later date as may be
acceptable to the Company.

1.9 "SERVICE" shall mean work performed by the Participant for the Company.

1.10 "CONSTRUCTION" The masculine gender when used herein shall be deemed to
include the feminine gender, and the singular may include the plural unless the
context clearly indicates to the contrary.

1.11 "AFTER TAX COST" shall mean the actual costs less an amount equal to the
combined federal and state income tax savings relating to the deduction of said
costs for federal and state tax purposes in the years such costs are incurred.

1.12 "POLICY" shall mean any policy of insurance purchased by the Company to
provide benefits with respect to a Participant under the Plan.

1.13 "PRE-RETIREMENT" shall mean the voluntary or involuntary termination of
service by a Participant prior to his Retirement Date.

1.14 "AGREEMENT" OR "PLAN" shall mean and include this Supplemental Executive
Retirement Plan and attached Schedules A and B.

1.15 "CASH VALUE" shall mean the cash surrender value of the Policy acquired by
the Company on a Participant's life, after reduction of all Policy loans used to
pay premiums and the After Tax Cost of interest, as provided herein.

1.16 "GROSSED-UP CASH VALUE" means the Cash Value of the policy acquired by the
Company on a Participant's life divided by an amount equal to one minus the
Company's marginal tax rate.

1.17 "TERMINATION BENEFIT" shall mean the benefit a Participant receives, as
provided in Article III, Section 2.

                                   ARTICLE II
                       RETIREMENT/PRE-RETIREMENT BENEFITS

(1) The Company agrees that each Participant may terminate his Service because
of Retirement upon the first day of the month following his 65th birthday, or
such later date as may be acceptable to the Company.

(2) Upon the date of a Participant's Retirement, such Participant shall elect
to:

          (i)  Retire and immediately receive benefits due; or

          (ii) Continue his employment and defer benefits which will accrue
               interest at the actual interest rate credited by the insurer.


                                       2



     Upon electing to receive benefits, the Participant shall receive 120 equal
monthly installments in an aggregate amount equal to the Grossed-Up Cash Value
of the Policy as of the date of Retirement, plus the projected Grossed-Up Cash
Value increase over the next nine consecutive Policy Years after the date of
Retirement, or at his election a lump sum amount equal to the Grossed-Up Cash
Value of the Policy as of the date of Retirement, payable within 30 days of the
Retirement Date.

(3) In the event a Participant shall cease rendering Service to the Company
prior to his date of Retirement, the Company shall stop paying annual premiums
on the Policy and the Retirement Benefit paid the Participant at Retirement Date
shall be 120 equal monthly installments, in an aggregate equal to the Grossed-Up
Cash Value of the Policy as of the date of Retirement, plus the projected
Grossed-Up Cash Value increase over the next nine consecutive Policy Years after
the date of Retirement, or at his election a lump sum amount equal to the
Grossed-Up Cash Value of the Policy as of the date of Retirement, payable within
30 days of Retirement Date.

(4) In the event a Participant should die prior to Retirement then:

          (a) Survivor Income Benefit Election. If the Participant elects the
survivor income benefit on the Participation Agreement and dies prior to
termination of his Service to the Company or his Retirement, the Company will
pay to the Participant's Beneficiary a sum equal to the Pre-Retirement amount
set forth on Schedule B, such amount to be payable in 120 monthly equal
installments to commence as soon as practicable following the Participant's
death.

          (b) Lump Sum Insurance Benefit Election. If the Participant elects the
lump sum benefit on the Participation Agreement and dies prior to termination of
his Service to the Company or Retirement, the Company shall promptly take any
action necessary to cause the death benefit provided under the Policy of life
insurance purchased by the Company hereunder on that Participant's life to be
paid. The amount of death benefit so payable to the Beneficiary shall be the
amount provided in Schedule B as a Pre-Retirement insurance death benefit. Any
additional benefit paid under the Policy shall be retained by the Company.

(5) Notwithstanding anything herein to the contrary the Participant shall be
entitled to the full amount which he would have been entitled to receive
hereunder if he were rendering Service to the Company on the Retirement Date, as
set forth in Section (2) of this Article II (or his Beneficiary shall be
entitled to the full amount set forth in Section (5) of this Article II as a
Survivor Income Benefit or as a Lump Sum Insurance Benefit in the event of the
death of a Participant prior to the Retirement Date) at such time as the
Company, its business or substantially all of its assets is sold, or acquired by
merger, consolidation or otherwise.

(6) Estimated Retirement Benefits and the Policy and Pre-Retirement death
benefits are set forth in Schedule B attached.

(7) Each Participant shall cooperate with the Company by furnishing any and all
information requested by the Company in order to facilitate the payment of
benefits hereunder, taking such physical examination as the Company may deem
necessary and taking such other relevant action as may be requested by the
Company. If a Participant refuses to cooperate, the Company shall have no
further obligation to the Participant under the Plan.

(8) For purposes of this Plan, a Participant or his Beneficiary shall have an
absolute right as an unsecured general creditor of the Company to payment of all
amounts and benefits including but not limited to Pre-Retirement Benefits.

                                   ARTICLE III


                                       3



                                 RETIREMENT DATE

The Company agrees that the Participant may terminate his Service because of
Retirement upon the earlier of (i) the first day of the month following his 65th
birthday, or (ii) upon such later date as may be acceptable to the Company.

                                   ARTICLE IV
                            DEATH PRIOR TO RETIREMENT

If the Participant dies prior to termination of his Service to the Company or
his Retirement Date, the Company will pay to his Beneficiary the amount provided
in Section (4) of Article II.

                                    ARTICLE V
                             DEATH AFTER RETIREMENT

Upon the death of the Participant after Retirement, the Company will pay to the
Participant's Beneficiary a sum equal to the balance of that amount which would
have been payable after Retirement, under the terms of Article II, Section (2).

                                   ARTICLE VI
                                   DISABILITY

If the Participant becomes disabled prior to Retirement, on the basis of any
standard established by the Board of Directors, and prior to termination of his
Service, the Company shall incur no obligation to commence benefit payments
immediately. In such event, the Company's obligation to pay benefits hereunder
will begin at Participant's reaching age 65. In the event of death of a disabled
Participant after commencement of retirement payments, the provisions of Article
V will apply. Notwithstanding the foregoing, in the event a disabled Participant
dies prior to Retirement, then the provisions of Article IV shall apply as
though at the time he died he was serving as a Participant who died prior to
Retirement.

                                   ARTICLE VII
                  NO GUARANTEE OF AMOUNT OF RETIREMENT BENEFITS

The Company does not guarantee the payment of the amount of projected retirement
benefits reflected on Schedule B, but does agree to pay an amount equal to the
Grossed-Up Cash Value as of the date of Retirement, or, in the event the
Participant elects 120 monthly payments under Article II, Section (2), the
projected Grossed-Up Cash Value increase over the next nine consecutive Policy
Years after the date of Retirement.

                                  ARTICLE VIII


                                       4



                             TERMINATION OF SERVICES

If the Company terminates the Service of the Participant, or if the Participant
terminates his Service prior to ten (10) years from the date hereof, any Company
obligation to the Participant shall cease. If the Company terminates the Service
of the Participant, or if the Participant terminates his Service after ten (10)
years from the date hereof, the Company shall pay the Participant or his
Beneficiary the termination benefits set forth in Section (4) of Article II.

                                   ARTICLE IX
                                   ASSIGNMENT

It is agreed that neither the Participant nor his Spouse nor any Beneficiary
shall have any right to convey, sell, assign, transfer, or otherwise convey the
right to receive any payments hereunder, which payments and rights thereto are
expressly declared to be nonassignable and nontransferable.

                                    ARTICLE X
                              RETENTION OF SERVICES

The benefits payable under this Agreement shall be independent of, and in
addition to, any other arrangement that may exist from time to time between the
parties hereto, or any other compensation payable by the Company to the
Participant. This Agreement shall not be deemed to constitute an employment
contract between the parties hereto, nor shall any provision hereof restrict the
right of the Company to terminate the Service of the Participant, or restrict
the right of the Participant to terminate his Service to the Company.

                                   ARTICLE XI
                              RIGHTS OF PARTICIPANT

The rights of the Participant under this Agreement and of any Beneficiary of the
Participant shall be solely those of an unsecured creditor of the Company. Any
Policy or any other asset acquired or held by the Company in connection with the
liabilities assumed by it hereunder shall not be deemed to be held under any
trust for the benefit of the Participant or his Beneficiary or to be a security
for the performance of the obligations of the Company, but shall be, and remain,
a general, unpledged, unrestricted asset of the Company.

                                   ARTICLE XII
                        OWNERSHIP OF INSURANCE CONTRACTS

The Company shall be the sole owner of any insurance contract or contracts
acquired on the life of a Participant, with incidents of ownership therein,
including, but not limited to, the right to cash and loan values, dividends, if
any, death benefits, and the right to termination thereof. The Participant shall
have the right to name on the Participation Agreement a Beneficiary for the
amount of the Pre-Retirement Death Benefit described herein.

                                  ARTICLE XIII


                                       5



                                 REORGANIZATION

The Company agrees that it will not merge or consolidate with any other
corporation or organization, or permit its business activities to be taken over
by another organization, unless and until the succeeding or continuing
corporation or other organization shall expressly assume the rights and
obligations of the Company herein set forth and as amended from time to time.
The Company further agrees that it will not cease business activities or
terminate its existence, other than as heretofore set forth in this paragraph,
without having made adequate provision for the fulfilling of its obligations
hereunder.

                                   ARTICLE XIV
                                   AMENDMENTS

This Plan may be revoked or be amended in whole or in part by a written
agreement signed by the Company and Participants.

                                   ARTICLE XV
                                 APPLICABLE LAW

This Plan shall be construed and governed in all respects under and by the laws
of the Commonwealth of Massachusetts.

                                   ARTICLE XVI
                                    HEADINGS

Headings and subheadings in this Agreement are inserted for convenience and
reference only and constitute no part of this Plan.

                                  ARTICLE XVII
                                  COUNTERPARTS

This Plan may be executed in an original and any number of counterparts, each of
which shall constitute an original of one and the same instrument.

                                  ARTICLE XVIII
                                CLAIMS PROCEDURE

Claims made under this plan shall be submitted to the Committee, which shall
establish such claims procedures as may be required by ERISA, to the extent
applicable, and other applicable laws. In the event of a dispute, the Company
and Participant shall submit the matter to binding arbitration to be conducted
under the rules of the American Arbitration Association in Boston,
Massachusetts. Each party shall have the right to designate an arbitrator and
the two arbitrators son designated shall select a third arbitrator.

                                   ARTICLE XIX


                                       6



                                 BINDING EFFECT

The provisions of this Plan shall be binding upon the parties. If any provisions
herein are deemed invalid or unenforceable, the remaining provisions shall
remain in full force and effect.

                                   ARTICLE XX
                                 EFFECTIVE DATE

The effective date of this Plan shall be April 4, 1995.

IN WITNESS WHEREOF, the said Company has caused this Plan to be signed in its
corporate name by its duly authorized officers.

                                        NATIONAL DENTEX CORPORATION


                                        By: /s/ WILLIAM M. MULLAHY
                                            ------------------------------------
                                            William M. Mullahy
                                            President & Chief Executive Officer


                                       7

EX-10.14

                                                                   Exhibit 10.14

                           NATIONAL DENTEX CORPORATION

                SUPPLEMENTAL LABORATORY EXECUTIVE RETIREMENT PLAN

This Plan is effective as of the 1st day of January 1996, and is established by
National Dentex Corporation, organized and existing under the laws of the
Commonwealth of Massachusetts (hereinafter referred to as the "Company"), and is
binding upon the Company and those persons who are eligible to become
participants hereunder and have elected to do so by executing a Participation
Agreement (hereinafter referred to as "Participant" and collectively as the
"Participants").

     WITNESSETH THAT:

     WHEREAS, the Participants are employed by the Company; and

     WHEREAS, the Participants have performed their duties in a capable and
efficient manner, resulting in growth and progress of the Company; and

     WHEREAS, the experience of each Participant is such that assurance of his
continued service is desirous to further growth of the Company; and

     WHEREAS, the parties hereto desire to arrange compensation in a different
manner to more effectively provide for each Participant's retirement or death.

     NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and
agreements hereinafter contained, and other good and valuable consideration,
receipt of which is hereby acknowledged, the Company hereby establishes the
National Dentex Corporation Supplemental Employee Retirement Plan as follows:

                                    ARTICLE I
                                   DEFINITIONS

1.1 "BENEFICIARY" shall mean any person, corporation, trust or other combination
of these, last designated in writing by a Participant to receive benefits
provided under this Plan. Such designation shall be filed with the Company and
shall be revocable at any time through written instruments similarly filed
without consent of any "Beneficiary". In the absence of any designation, the
benefits payable hereunder shall be delivered by the Company to the Executor(s)
or Administrator(s) of the Participant's estate.

1.2 "BOARD OF DIRECTORS" shall mean the Board of Directors of the Company.

1.3 "CLERK" shall mean the Clerk of the Company.

1.4 "COMMITTEE" shall mean the Executive Compensation Committee of the Board of
Directors.

1.5 "COMPANY" shall mean National Dentex Corporation.

1.6 "PARTICIPANT" shall mean any person designated by the Committee who elects
to participate in the Plan through execution of the Participation Agreement.


                                        1



1.7 "PARTICIPATION AGREEMENT" shall mean the form of written agreement, attached
hereto as Schedule A, which is entered into by and between the Company and a
Participant as a condition to participation in the Plan.

1.8 "RETIREMENT", "RETIRE", AND "RETIREMENT DATE" shall mean the date on which a
Participant attains the age sixty-five (65) or such later date as may be
acceptable to the Company.

1.9 "SERVICE" shall mean work performed by the Participant for the Company.

1.10 "CONSTRUCTION" The masculine gender when used herein shall be deemed to
include the feminine gender, and the singular may include the plural unless the
context clearly indicates to the contrary.

1.11 "AFTER TAX COST" shall mean the actual costs less an amount equal to the
combined federal and state income tax savings relating to the deduction of said
costs for federal and state tax purposes in the years such costs are incurred.

1.12 "POLICY" shall mean any policy of insurance purchased by the Company to
provide benefits with respect to a Participant under the Plan.

1.13 "PRE-RETIREMENT" shall mean the voluntary or involuntary termination of
service by a Participant prior to his Retirement Date.

1.14 "AGREEMENT" OR "PLAN" shall mean and include this Supplemental Executive
Retirement Plan and attached Schedules A and B.

1.15 "CASH VALUE" shall mean the cash surrender value of the Policy acquired by
the Company on a Participant's life, after reduction of all Policy loans used to
pay premiums and the After Tax Cost of interest, as provided herein.

1.16 "GROSSED-UP CASH VALUE" means the Cash Value of the policy acquired by the
Company on a Participant's life divided by an amount equal to one minus the
Company's marginal tax rate.

1.17 "TERMINATION BENEFIT" shall mean the benefit a Participant receives, as
provided in Article III, Section 2.

                                   ARTICLE II
                       RETIREMENT/PRE-RETIREMENT BENEFITS

(1) The Company agrees that each Participant may terminate his Service because
of Retirement upon the first day of the month following his 65th birthday, or
such later date as may be acceptable to the Company.

(2) Upon the date of a Participant's Retirement, such Participant shall elect
to:

          (i)  Retire and immediately receive benefits due; or

          (ii) Continue his employment and defer benefits which will accrue
               interest at the actual interest rate credited by the insurer.

     Upon electing to receive benefits, the Participant shall receive 120 equal
monthly installments in an aggregate amount equal to the Grossed-Up Cash Value
of the Policy as of the date of Retirement, plus


                                        2



the projected Grossed-Up Cash Value increase over the next nine consecutive
Policy Years after the date of Retirement, or at his election a lump sum amount
equal to the Grossed-Up Cash Value of the Policy as of the date of Retirement,
payable within 30 days of the Retirement Date.

(3) In the event a Participant shall cease rendering Service to the Company
prior to ten (10) years from the date hereof, the Company shall stop paying
annual premiums on the Policy and the Participant will forfeit all benefits
under this Plan.

(4) In the event a Participant shall cease rendering Service to the Company
after ten (10) years from the date hereof but prior to his date of retirement,
the Participant shall receive benefits as in Section (2) above.

(5) In the event a Participant should die prior to Retirement then:

          (a) Survivor Income Benefit Election. If the Participant elects the
survivor income benefit on the Participation Agreement and dies prior to
termination of his Service to the Company or his Retirement, the Company will
pay to the Participant's Beneficiary a sum equal to the Pre-Retirement amount
set forth on Schedule B, such amount to be payable in 120 monthly equal
installments to commence as soon as practicable following the Participant's
death.

          (b) Lump Sum Insurance Benefit Election. If the Participant elects the
lump sum benefit on the Participation Agreement and dies prior to termination of
his Service to the Company or Retirement, the Company shall promptly take any
action necessary to cause the death benefit provided under the Policy of life
insurance purchased by the Company hereunder on that Participant's life to be
paid. The amount of death benefit so payable to the Beneficiary shall be the
amount provided in Schedule B as a Pre-Retirement insurance death benefit. Any
additional benefit paid under the Policy shall be retained by the Company.

(6) Notwithstanding anything herein to the contrary the Participant shall be
entitled to the full amount which he would have been entitled to receive
hereunder if he were rendering Service to the Company on the Retirement Date, as
set forth in Section (2) of this Article II (or his Beneficiary shall be
entitled to the full amount set forth in Section (5) of this Article II as a
Survivor Income Benefit or as a Lump Sum Insurance Benefit in the event of the
death of a Participant prior to the Retirement Date) at such time as the
Company, its business or substantially all of its assets is sold, or acquired by
merger, consolidation or otherwise.

(7) Estimated Retirement Benefits and the Policy and Pre-Retirement death
benefits are set forth in Schedule B attached.

(8) Each Participant shall cooperate with the Company by furnishing any and all
information requested by the Company in order to facilitate the payment of
benefits hereunder, taking such physical examination as the Company may deem
necessary and taking such other relevant action as may be requested by the
Company. If a Participant refuses to cooperate, the Company shall have no
further obligation to the Participant under the Plan.

(9) For purposes of this Plan, a Participant or his Beneficiary shall have an
absolute right as an unsecured general creditor of the Company to payment of all
amounts and benefits including but not limited to Pre-Retirement Benefits.

                                   ARTICLE III
                                 RETIREMENT DATE


                                        3



The Company agrees that the Participant may terminate his Service because of
Retirement upon the earlier of (i) the first day of the month following his 65th
birthday, or (ii) upon such later date as may be acceptable to the Company.

                                   ARTICLE IV
                            DEATH PRIOR TO RETIREMENT

If the Participant dies prior to termination of his Service to the Company or
his Retirement Date, the Company will pay to his Beneficiary the amount provided
in Section (5) of Article II.

                                    ARTICLE V
                             DEATH AFTER RETIREMENT

Upon the death of the Participant after Retirement, the Company will pay to the
Participant's Beneficiary a sum equal to the balance of that amount which would
have been payable after Retirement, under the terms of Article II, Section (2).

                                   ARTICLE VI
                                   DISABILITY

If the Participant becomes disabled prior to Retirement, on the basis of any
standard established by the Board of Directors, and prior to termination of his
Service, the Company shall incur no obligation to commence benefit payments
immediately. In such event, the Company's obligation to pay benefits hereunder
will begin at Participant's reaching age 65. In the event of death of a disabled
Participant after commencement of retirement payments, the provisions of Article
V will apply. Notwithstanding the foregoing, in the event a disabled Participant
dies prior to Retirement, then the provisions of Article IV shall apply as
though at the time he died he was serving as a Participant who died prior to
Retirement.

                                   ARTICLE VII
                  NO GUARANTEE OF AMOUNT OF RETIREMENT BENEFITS

The Company does not guarantee the payment of the amount of projected retirement
benefits reflected on Schedule B, but does agree to pay an amount equal to the
Grossed-Up Cash Value as of the date of Retirement, or, in the event the
Participant elects 120 monthly payments under Article II, Section (2), the
projected Grossed-Up Cash Value increase over the next nine consecutive Policy
Years after the date of Retirement.

                                  ARTICLE VIII
                             TERMINATION OF SERVICES


                                        4



If the Company terminates the Service of the Participant, or if the Participant
terminates his Service prior to ten (10) years from the date hereof, any Company
obligation to the Participant shall cease. If the Company terminates the Service
of the Participant, or if the Participant terminates his Service after ten (10)
years from the date hereof, the Company shall pay the Participant or his
Beneficiary the termination benefits set forth in Section (4) of Article II.

                                   ARTICLE IX
                                   ASSIGNMENT

It is agreed that neither the Participant nor his Spouse nor any Beneficiary
shall have any right to convey, sell, assign, transfer, or otherwise convey the
right to receive any payments hereunder, which payments and rights thereto are
expressly declared to be nonassignable and nontransferable.

                                    ARTICLE X
                              RETENTION OF SERVICES

The benefits payable under this Agreement shall be independent of, and in
addition to, any other arrangement that may exist from time to time between the
parties hereto, or any other compensation payable by the Company to the
Participant. This Agreement shall not be deemed to constitute an employment
contract between the parties hereto, nor shall any provision hereof restrict the
right of the Company to terminate the Service of the Participant, or restrict
the right of the Participant to terminate his Service to the Company.

                                   ARTICLE XI
                              RIGHTS OF PARTICIPANT

The rights of the Participant under this Agreement and of any Beneficiary of the
Participant shall be solely those of an unsecured creditor of the Company. Any
Policy or any other asset acquired or held by the Company in connection with the
liabilities assumed by it hereunder shall not be deemed to be held under any
trust for the benefit of the Participant or his Beneficiary or to be a security
for the performance of the obligations of the Company, but shall be, and remain,
a general, unpledged, unrestricted asset of the Company.

                                   ARTICLE XII
                        OWNERSHIP OF INSURANCE CONTRACTS

The Company shall be the sole owner of any insurance contract or contracts
acquired on the life of a Participant, with incidents of ownership therein,
including, but not limited to, the right to cash and loan values, dividends, if
any, death benefits, and the right to termination thereof. The Participant shall
have the right to name on the Participation Agreement a Beneficiary for the
amount of the Pre-Retirement Death Benefit described herein.

                                  ARTICLE XIII
                                 REORGANIZATION


                                        5



The Company agrees that it will not merge or consolidate with any other
corporation or organization, or permit its business activities to be taken over
by another organization, unless and until the succeeding or continuing
corporation or other organization shall expressly assume the rights and
obligations of the Company herein set forth and as amended from time to time.
The Company further agrees that it will not cease business activities or
terminate its existence, other than as heretofore set forth in this paragraph,
without having made adequate provision for the fulfilling of its obligations
hereunder.

                                   ARTICLE XIV
                                   AMENDMENTS

This Plan may be revoked or be amended in whole or in part by a written
agreement signed by the Company and Participants.

                                   ARTICLE XV
                                 APPLICABLE LAW

This Plan shall be construed and governed in all respects under and by the laws
of the Commonwealth of Massachusetts.

                                   ARTICLE XVI
                                    HEADINGS

Headings and subheadings in this Agreement are inserted for convenience and
reference only and constitute no part of this Plan.

                                  ARTICLE XVII
                                  COUNTERPARTS

This Plan may be executed in an original and any number of counterparts, each of
which shall constitute an original of one and the same instrument.

                                  ARTICLE XVIII
                                CLAIMS PROCEDURE

Claims made under this plan shall be submitted to the Committee, which shall
establish such claims procedures as may be required by ERISA, to the extent
applicable, and other applicable laws. In the event of a dispute, the Company
and Participant shall submit the matter to binding arbitration to be conducted
under the rules of the American Arbitration Association in Boston,
Massachusetts. Each party shall have the right to designate an arbitrator and
the two arbitrators son designated shall select a third arbitrator.

                                   ARTICLE XIX
                                 BINDING EFFECT


                                        6



The provisions of this Plan shall be binding upon the parties. If any provisions
herein are deemed invalid or unenforceable, the remaining provisions shall
remain in full force and effect.

                                   ARTICLE XX
                                 EFFECTIVE DATE

The effective date of this Plan shall be January 1, 1996.

IN WITNESS WHEREOF, the said Company has caused this Plan to be signed in its
corporate name by its duly authorized officers.

                                        NATIONAL DENTEX CORPORATION


                                        By: /s/ DAVID L. BROWN
                                            ------------------------------------
                                            David L. Brown
                                            President & Chief Executive Officer


                                        7

EX-21

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                                                                               .
                                                                               .

                                                                      EXHIBIT 21

                           SUBSIDIARIES OF THE COMPANY



                                    ORGANIZED UNDER     PERCENTAGE OWNED BY REGISTRANT
             NAME                     THE LAWS OF           AS OF DECEMBER 31, 2005
- -------------------------------     ---------------     ------------------------------
                                                  
Green Dental Laboratories, Inc.        Arkansas                       100%

EX-23

                                                                      EXHIBIT 23

            CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

      We hereby consent to the incorporation by reference in the Registration
Statements on Form S-8 (No. 333-28623, 333-50341, 333-38998, 333-66446, and
333-116541) of National Dentex Corporation of our report dated March 16, 2006
relating to the financial statements, management's assessment of the
effectiveness of internal control over financial reporting and the effectiveness
of internal control over financial reporting, which appears in this Form 10-K.

/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
March 16, 2006

EX-31.1

Exhibit 31.1

CERTIFICATION

I, David L. Brown, President, Chief Executive Officer and Director, certify that:

1. I have reviewed this report on Form 10-K of National Dentex 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 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 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 officer 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 the 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.

/s/  David L. Brown

David L. Brown

President, Chief Executive Officer and Director

March 16, 2006

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Richard F. Becker, Jr., Executive Vice President, Treasurer and Chief Financial Officer, certify that:

1. I have reviewed this report on Form 10-K of National Dentex 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 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 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 officer 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 the 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.

/s/  Richard F. Becker, Jr.

Richard F. Becker, Jr.

Executive Vice President, Treasurer and

Chief Financial Officer

March 16, 2006

EX-32.1

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 Annual Report of National Dentex Corporation (the “Company”) on Form 10-K for the year ending December 31, 2005 filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, David L. Brown, President, Chief Executive Officer, and Director of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my 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 and result of operations of the Company.

By:  /s/  David L. Brown

David L. Brown

President, Chief Executive Officer and Director

March 16, 2006

EX-32.2

Exhibit 32.2

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 Annual Report of National Dentex Corporation (the “Company”) on Form 10-K for the year ending December 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Richard F. Becker, Jr., Chief Financial Officer, Executive Vice President and Treasurer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my 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 and result of operations of the Company.

By:  /s/  Richard F. Becker, Jr.

Richard F. Becker, Jr.

Executive Vice President, Treasurer and

Chief Financial Officer

March 16, 2006