Disconnect the oil tubes.
Note: Some spindles have (1) oil tube. All service spindle have (2) oil tubes.
Remove the fittings  from the spindle lubrication ports.
Install a 1/8" NPT plug into each of the oil fitting port on the spindle. Install the plugs flush or below flush with the surface of the spindle. This prevents contamination of the spindle.
Disconnect the encoder cable  and ground wire  from the encoder read-head .
Remove the non-contact encoder assembly. Refer to "VMC - 50-Taper - Non-Contact Encoder - Replacement" step in the 50-Taper - Non-Contact Encoder - Replacement procedure.