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Exhibit 10.39
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "AGREEMENT"), is made as of
November 8, 2000, by and among XXxxx.xxx, Inc., a Delaware corporation
("PARENT") and AHR Seller Group, LLC (the "STOCKHOLDER"), the sole stockholder
of United/HealthScope, Inc.(dba Advica Health Resources), a Delaware corporation
(the "COMPANY").
BACKGROUND
A. Pursuant to the terms of the Agreement and Plan of Reorganization dated
as of November 7, 2000 (the "REORGANIZATION AGREEMENT"), by and among Parent,
the Company and AX Acquisition Corporation, a wholly owned subsidiary of Parent
("SUB"), Sub is being merged with and into the Company (the "MERGER"), with the
Company being the surviving corporation.
B. In connection with the Merger, the Stockholder will receive shares of
common stock of Parent ("PARENT COMMON STOCK").
C. The Reorganization Agreement provides for the execution and delivery of
this Agreement at the closing of the transactions contemplated thereby which
grants the Stockholder certain rights to have its shares of Parent Common Stock
registered under the Securities Act of 1933, as amended.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
1. CERTAIN DEFINITIONS. In this Agreement the following terms shall have
the following respective meanings:
"COMMISSION" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"REGISTRATION EXPENSES" shall mean all expenses, except as otherwise
stated below, incurred by Parent in complying with Section 2, including, without
limitation, all registration, qualification and filing fees, printing expenses,
escrow fees, fees and disbursements of counsel for Parent, blue sky fees and
expenses, the expense of any special audits incident to or required by any such
registration (but excluding the compensation of regular employees of Parent
which shall be paid in any event by Parent) any and all fees and expenses
incurred in connection with road show presentations and the reasonable fees and
disbursements of one counsel for all holders in any registration under this
Agreement.
"RESTRICTED SECURITIES" shall mean the securities of the Company not
available for sale under Rule 144(k) of the Securities Act of 1933, as such Rule
may be
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amended from time to time, or any similar successor rule that may be promulgated
by the Commission.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended, or
any similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"SELLING EXPENSES" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the holders.
2. COMPANY REGISTRATION.
(a) Notice of Registration. If at any time or from time to time Parent
shall determine to register any of its equity securities, either for its own
account or the account of a security holder or holders, other than (i) a
registration relating solely to employee benefit plans or (ii) a registration
relating solely to a Rule 145 transaction, Parent will:
(i) promptly give to the Stockholder written notice thereof and a
reasonably detailed explanation of Stockholder's rights and obligations under
this Section 2;
(ii) include in such registration (and any related qualification
under blue sky laws or other compliance), and in any underwriting involved
therein, all shares of Parent Common Stock held by Stockholder specified in a
written request or requests, made within thirty (30) days after mailing of such
written notice by Parent, to Stockholder; and
(iii) use its best efforts to effect such registration under the
Securities Act of all shares of Parent Common Stock that Stockholder has
requested that Parent register.
(b) Underwriting. If the registration of which Parent gives notice is
for a registered public offering involving an underwriting, Parent shall so
advise Stockholder as a part of the written notice given pursuant to Section
2(a)(i). In such event, the right of the Stockholder to registration pursuant to
Section 2 shall be conditioned upon Stockholder's participation in such
underwriting and the inclusion of at least 10,000 shares (or balance owed) of
Parent Common Stock in the underwriting to the extent provided herein.
Stockholder, together with Parent and the other holders distributing their
securities through such underwriting, shall enter into an underwriting agreement
in customary form with the managing underwriter selected for such underwriting
by Parent. Notwithstanding any other provision of this Section 2, if the
managing underwriter determines that marketing factors require a limitation of
the number of shares to be underwritten, the managing underwriter may limit the
number of shares to be included in such registration. Parent shall so advise
Stockholder and other holders distributing their securities through such
underwriting and the number of shares that may be included in the registration
and underwriting shall be allocated in the
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following manner: first, to Parent; second, among all Holders of Series A and
Series B Registrable Securities (as such terms are defined in the Amended and
Restated Investor Rights Agreement dated June 4, 1999 (the "INVESTOR RIGHTS
AGREEMENT")), on a pro rata, as converted basis, as nearly as practicable to the
respective amounts of Registrable Securities (as defined in the Investor Rights
Agreement) held by such holders at the time of filing the Registration
Statement; third, to Stockholder; and fourth, among all holders of Registrable
Securities who are either an officer or a director of Parent, in proportion, as
nearly as practicable to the respective amounts of Registrable Securities held
by such holders at the time of filing the Registration Statement. No shares
excluded from the underwriting by reason of the underwriter's marketing
limitation shall be included in such registration. To facilitate the allocation
of shares in accordance with the above provisions, Parent or the underwriters
may round the number of shares allocated to any holder to the nearest one
hundred (100) shares.
If Stockholder disapproves of the terms of any such underwriting, it may
elect to withdraw therefrom by written notice to Parent and the managing
underwriter. Any securities excluded or withdrawn from such underwriting shall
be withdrawn from such registration.
(c) Right to Terminate Registration. Parent shall have the right to
terminate or withdraw any registration initiated by it under this Section 2
prior to the effectiveness of such registration whether or not Stockholder has
elected to include securities in such registration; provided, that Parent shall
have the obligation to pay all Registration Expenses in connection with any such
registration incurred pursuant to this Section 2.
(d) Expenses of Registration. All Registration Expenses incurred in
connection with registrations pursuant to Section 2 shall be borne by Parent.
Unless otherwise stated, all Selling Expenses relating to securities registered
on behalf of Stockholder and the other holders of such securities shall be borne
by Stockholder and the other holders of such securities pro rata on the basis of
the number of shares so registered.
(e) Registration Procedures. In the case of each registration,
qualification or compliance effected by Parent pursuant to this Section 2,
Parent will keep Stockholder advised in writing as to the initiation of each
registration, qualification and compliance and as to the completion thereof. At
its expense, Parent will as expeditiously as possible:
(i) prepare and file with the Commission a registration statement
with respect to such securities and use its best efforts to cause such
registration statement to become and remain effective for at least ninety (90)
days or until the distribution described in the registration statement has been
completed;
(ii) furnish to those participating in such registration and to the
underwriters of the securities being registered such reasonable number of copies
of the registration statement and of each amendment and supplement thereto,
preliminary
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prospectus, final prospectus and such other documents in conformity with the
Securities Act as may be reasonably requested in order to facilitate the public
offering of such securities;
(iii) prepare and file with the Commission any amendments and
supplements to the registration statement and the prospectus included in the
registration statement as may be necessary to keep the registration statement
effective, in the case of a firm commitment underwritten public offering, until
each underwriter has completed the distribution of all securities purchased by
it and, in the case of any other offering, until the earlier of the sale of all
shares of Parent Common Stock covered thereby or 180 days after the effective
date thereof, provided that before filing a registration statement, or any
amendments or supplements thereto, Parent will furnish to Stockholder and its
counsel, copies of all documents to be filed, which documents will be subject to
the review of such counsel;
(iv) use its best efforts to register or qualify the shares of
Parent Common Stock covered by the registration statement under the securities
or Blue Sky laws of such states as Stockholder shall reasonably request, and do
any and all other acts and things that may be necessary or desirable to enable
Stockholder to consummate the public sale or other disposition in such states of
the Registrable Securities owned by the Stockholder; provided, however, that
Parent shall not be required in connection with this paragraph (iv) to qualify
as a foreign corporation or execute a general consent to service of process in
any jurisdiction;
(v) if Parent has delivered preliminary or final prospectuses to
Stockholder and after having done so the prospectus is amended to comply with
the requirements of the Securities Act, Parent shall promptly notify Stockholder
and, if requested, Stockholder shall immediately cease making offers of Parent
Common Stock and return all prospectuses to Parent. Parent shall promptly
provide Stockholder with revised prospectuses and, following receipt of the
revised prospectuses, Stockholder shall be free to resume making offers of
Parent Common Stock;
(vi) make available for inspection by Stockholder, by any
underwriter participating in any disposition to be effected pursuant to such
registration statement and by any attorney, accountant or other agent retained
by Stockholder or any such underwriter, all pertinent financial and other
records, pertinent corporate documents and properties of Parent, officers,
directors and employees of Parent, and cause all of such officers, directors and
employees to supply all information reasonably requested by Stockholder,
underwriter, attorney, accountant or agent in connection with the registration
statement;
(vii) notify Stockholder, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act within the
appropriate period mentioned in Section 2(e)(iii), of Parent's becoming aware
that the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances then existing, and at
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the request of Stockholder, prepare and furnish a reasonable number of copies of
any prospectus as may be necessary so that, as thereafter delivered to the
purchasers of shares of Parent Common Stock, such prospectus shall not include
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading
in the light of the circumstances then existing;
(viii) use its best efforts to comply with all applicable rules and
regulations of the Commission, and make available to its security holders, as
soon as reasonably practicable (but not more than eighteen (18) months) after
the effective date of the registration statement, an earnings statement which
shall satisfy the provisions of Section 11(a) of the Securities Act and the
rules and regulations promulgated thereunder;
(ix) enter into such customary agreements (including an underwriting
agreement in customary form) and take such other actions as sellers of a
majority of shares of such Registrable Securities and shares of Parent Common
Stock or the underwriters, if any, reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities and shares of Parent
Common Stock; and
(x) obtain a "cold comfort" letter or letters from Parent's
independent public accountants in customary form.
3. INDEMNIFICATION.
(a) Parent will indemnify and hold harmless Stockholder and each
affiliate thereof, and its respective officers, directors, partners,
accountants, legal counsel and agents, and each person controlling Stockholder
or affiliate thereof within the meaning of Section 15 of the Securities Act,
with respect to which registration, qualification or compliance has been
effected pursuant to Section 2, and each person or entity that participates as
underwriter, if any, and each person who controls any underwriter within the
meaning of Section 15 of the Securities Act (each, a "PARENT INDEMNIFIED
PARTY"), against all expenses, claims, losses, damages and liabilities (joint or
several) (or actions in respect thereof), including any of the foregoing
incurred in settlement of any litigation, commenced or threatened, arising out
of or based on any untrue statement (or alleged untrue statement) of a material
fact contained in any registration statement, prospectus, offering circular or
other document, or any amendment or supplement thereto, incident to any such
registration, qualification or compliance, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in which
they were made, not misleading, or any violation or alleged violation by Parent
of the Securities Act or any rule or regulation promulgated under the Securities
Act, the Exchange Act, state securities or Blue Sky Laws or otherwise applicable
to Parent in connection with any such registration, qualification or compliance,
and Parent will reimburse each such Parent Indemnified Party, for any legal and
any other expenses reasonably incurred in connection with investigating,
preparing, defending or settling any such claim, loss, damage, liability, action
or proceeding, provided that Parent will not be liable in any such case to the
extent that any such claim, loss, damage, liability or
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expense arises out of or is based on any untrue statement or omission or alleged
untrue statement or omission, made in reliance upon and in conformity with
written information furnished to Parent by an instrument duly executed by
Stockholder, controlling person or underwriter and stated to be specifically for
use therein.
(b) Stockholder will, if the shares of Parent Common Stock held by
Stockholder are included in the securities as to which such registration,
qualification or compliance is being effected, indemnify Parent, each of its
directors and officers, each underwriter, if any, of Parent's securities covered
by such a registration statement, each person who controls Parent or such
underwriter within the meaning of Section 15 of the Securities Act, and each
other such holder, each of its officers, directors and partners, and each person
controlling such holder within the meaning of Section 15 of the Securities Act
(collectively the "HOLDER INDEMNIFIED PARTIES"), against all claims, losses,
damages and liabilities (or actions in respect thereof) arising out of or based
on any untrue statement (or alleged untrue statement) of a material fact
contained in any such registration statement, prospectus, offering circular or
other document, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse Parent, such other holders, such
directors, officers, persons, underwriters or control persons for any legal or
any other expenses reasonably incurred in connection with investigating or
defending any such claim, loss, damage, liability or action; provided that in
each of the foregoing pursuant to this Section 3, Stockholder shall only
indemnify the Holder Indemnified Parties to the extent, but only to the extent,
that such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is made in such registration statement, prospectus, offering circular
or other document in reliance upon and in conformity with written information
furnished to Parent by an instrument duly executed by Stockholder and stated to
be specifically for use therein. Notwithstanding the foregoing, the liability of
Stockholder under this subsection (b) shall be limited in an amount equal to the
gross proceeds received by Stockholder from the sale.
(c) Each party entitled to indemnification under this Section 3 (the
"INDEMNIFIED PARTY") shall give written notice to the party required to provide
indemnification (the "INDEMNIFYING PARTY") promptly after such Indemnified Party
has received written notice of the commencement of any action, claim or
proceeding as to which indemnity may be sought, and shall permit the
Indemnifying Party to assume the defense of any such claim or any litigation
resulting therefrom, provided that counsel for the Indemnifying Party, who shall
conduct the defense of such claim or litigation, shall be approved by the
Indemnified Party (whose approval shall not unreasonably be withheld), and the
Indemnified Party may participate in such defense at such party's expense (other
than the reasonable costs of investigation which shall be paid by the
Indemnifying Party), and provided further that the failure of any Indemnified
Party to give notice as provided herein shall not relieve the Indemnifying Party
of its obligations under this Section 3 unless but only to the extent that the
failure to give such notice is materially prejudicial to an Indemnifying Party's
ability to defend such action and provided further, that the Indemnifying Party
shall not assume the defense for matters as to which there is, in the reasonable
judgment of the Indemnified Party an actual or potential conflict of interest or
separate and different defenses. If there is such an actual or potential
conflict, then such
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Indemnified Party may employ separate counsel to represent such Indemnified
Party and the Indemnifying Party shall be liable for the reasonable fees and
expenses of separate counsel. No Indemnifying Party, in the defense of any such
claim or litigation, shall, except with the written consent of each Indemnified
Party, consent to entry of any judgment or enter into any settlement which does
not include as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Party of a release from all liability in respect
to such claim or litigation.
(d) In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which either (i) Stockholder,
or any controlling person of Stockholder, makes a claim for indemnification
pursuant to this Section 3 but it is judicially determined (by the entry of a
final judgment or decree by a court of competent jurisdiction and the expiration
of time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding the fact that
this Section 3 provides for indemnification in such case or (ii) contribution
under the Securities Act may be required on the part of Stockholder or any such
controlling person in circumstances for which indemnification is provided under
this Section 3; then, and in each such case, Parent and Stockholder will
contribute to the aggregate losses, claims, damages or liabilities to which they
may be subject (after contribution from others) in such proportion (i) so that
Stockholder shall under no circumstances be responsible for more than the
portion represented by the percentage that the public offering price of its
shares of Parent Common Stock offered by and sold under the registration
statement bears to the public offering price of all securities offered by and
sold under such registration statement and (ii) so that the relative benefits
received by each party from the offering of the shares of Parent Common Stock
(taking into account the portion of the proceeds realized by each), the parties'
relative knowledge and access to information concerning the matter with respect
to which the claim was asserted, the opportunity to correct and prevent any
misstatement or omission and any other equitable considerations appropriate
under the circumstances shall be considered, and Parent and the Stockholder are
responsible for the remaining portion; provided, however, that in any such case,
(A) Stockholder will not be required to contribute any amount in excess of the
public offering price of all such shares of Parent Common Stock offered and sold
Stockholder pursuant to such registration statement and (B) no person to the
extent that contribution is not permitted under Section 11(f) of the Securities
Act will be entitled to contribution.
(e) The obligations of Parent and Stockholder under this Section 3 shall
survive the completion of any offering of shares of Parent Common Stock in a
registration statement, and otherwise.
(f) The obligations of the parties under this Section 3 shall be in
addition to any liability which any party may otherwise have to any other party.
4. TERMINATION OF REGISTRATION RIGHTS. The rights granted pursuant to this
Agreement, to the extent not earlier terminated by the terms hereof, shall
terminate as to Stockholder at such time as all shares of Parent Common Stock
held by Stockholder can be sold without compliance with the registration
requirements of the Securities Act
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pursuant to Rule 144 (including without limitation Rule 144(k)) promulgated
thereunder and Stockholder owns less than 1% of the then outstanding Registrable
Securities and shares of Parent Common Stock together.
5. INFORMATION BY STOCKHOLDER. Stockholder shall furnish to Parent such
information regarding Stockholder, the shares of Parent Common Stock held by it
and the distribution proposed by Stockholder as Parent may reasonably request in
writing and as shall be reasonably required in connection with any registration,
qualification or compliance referred to in Section 2.
6. RULE 144 REPORTING. With a view to making available the benefits of
certain rules and regulations of the Commission which may at any time permit the
sale of the shares of Parent Common Stock to the public without registration,
after such time as a public market exists for the Parent Common Stock, Parent
agrees to:
(a) Make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act, at all times after
the effective date that Parent becomes subject to the reporting requirements of
the Securities Act or the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT");
(b) File with the Commission in a timely manner all reports and other
documents required of Parent under the Securities Act and the Exchange Act (at
any time after it has become subject to such reporting requirements);
(c) Furnish promptly to Stockholder forthwith upon request a written
statement by Parent as to its compliance with the reporting requirements of said
Rule 144 (at any time after ninety (90) days after the effective date of the
first registration statement filed by Parent for an offering of its securities
to the general public), and of the Securities Act and the Exchange Act (at any
time after it has become subject to such reporting requirements), a copy of the
most recent annual or quarterly report of Parent, and such other reports and
documents of Parent and other information in the possession of or reasonably
obtainable by Parent as Stockholder may reasonably request in availing itself of
any rule or regulation of the Commission allowing Stockholder to sell any such
securities without registration.
7. TRANSFER OF REGISTRATION RIGHTS. The rights to cause Parent to register
the shares of Parent Common Stock under Section 2 may be assigned to a
transferee or assignee in connection with any transfer or assignment of the
shares of Parent Common Stock by Stockholder provided that Parent is given
notice of the transfer or assignment and: (i) such transfer may otherwise be
effected in accordance with applicable securities laws and (ii) either (A) such
assignee or transferee acquires at least 10,000 shares of Parent Common Stock
or, if lesser, all of such shares held by Stockholder or (B) such transferee is
an affiliate of Stockholder (defined as a person that directly, or indirectly
through one or more intermediaries, controls or is controlled by, or is under
common control with Stockholder). Notwithstanding the foregoing, the rights to
cause Parent to register securities may be assigned to any constituent partner
or retired partner of
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Stockholder which is a partnership or any family member or trust for the benefit
of any such individual holder, without compliance with item (ii) above.
8. STANDOFF AGREEMENT. Stockholder agrees in connection with the public
offering of Parent's securities, upon written request of Parent or the managing
underwriter, if any, any underwritten offering of Parent's securities, not to
sell, make any short sale of, loan, grant any option for the purchase of, or
otherwise dispose of any shares of Parent Common Stock (other than those
included in the registration) without the prior written consent of Parent or
such underwriter, as the case may be, for such period of time (not to exceed one
hundred eighty (180) days)(the "LOCKUP PERIOD") during the effectiveness of such
registration statement relating to such offering, provided that similar lockup
agreements are entered into by each of Parent's officers and directors and all
holders holding not less than one percent (1%) of the outstanding capital stock
of Parent and that such agreement shall not apply to Registrable Securities
included in the registration statement. In order to enforce the provisions of
this Section 8, Parent may impose stop-transfer instructions with respect to the
securities of Parent held by Stockholder not included in the registration
statement until the end of the Lockup Period.
9. MISCELLANEOUS.
(a) Governing Law. This Agreement shall be governed and construed in all
respects in accordance with the laws of the State of Delaware as applied to
agreements made and performed in Delaware by residents of the State of Delaware.
(b) Entire Agreement; Amendment. This Agreement constitutes the entire
understanding and agreement between the parties with regard to the subjects
hereof, and no party shall be liable or bound to any other party in any manner
by any warranties, representations or covenants except as specifically set forth
herein. Except as expressly provided herein, neither this Agreement nor any term
hereof may be amended, supplemented, modified, waived, discharged or terminated
other than by a written instrument signed by the party against whom enforcement
of any such amendment, waiver, discharge or termination is sought.
(c) Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by registered or
certified mail, postage prepaid or otherwise delivered by hand or by messenger,
addressed (a) if to Stockholder, at Stockholder's address set forth on the
signature pages hereof, or at such other address as Stockholder shall have
furnished to Parent in writing or (b) if to Parent, one copy should be sent to
Parent's executive offices addressed to the attention of the Chief Executive
Officer, at such address as Parent shall have furnished to Stockholder, and one
copy should be sent to Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, 000 Xxxx Xxxx Xxxx,
Xxxx Xxxx, Xxxxxxxxxx 00000, Attn.: Xxxxxxxx Xxxxx.
Each such notice or other communication shall, unless otherwise expressly
provided herein, be treated as effective or having been given when delivered if
delivered personally, or, if sent by mail, at the earlier of its receipt or
seventy-two (72) hours after
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the same has been deposited in a regularly maintained receptacle for the deposit
of the United States mail, addressed and mailed as aforesaid.
(d) Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision; provided that no such severability shall be effective if
it materially changes the economic benefit of this Agreement to any party.
(e) Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not considered in construing or
interpreting this Agreement.
(f) Counterparts. This Agreement may be executed in any number of
counterparts, each of which may be executed by less than all of the parties
hereto, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
(g) Successors and Assigns. Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
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In witness whereof, the parties have caused this Agreement to be duly
executed as of the date first written above.
XXXXX.XXX, INC.
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By:
Title:
AHR SELLER GROUP, LLC
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By:
Title:
