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EXHIBIT 10.2
NEITHER THIS WARRANT NOR THE COMMON STOCK WHICH MAY BE ACQUIRED UPON EXERCISE
HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AS AMENDED (THE
"ACT"), OR UNDER ANY STATE SECURITIES LAW AND MAY NOT BE PLEDGED, SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
WITH RESPECT THERETO UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAW, OR
UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY,
THAT SUCH REGISTRATION IS NOT REQUIRED. THE COMPANY'S SUBSCRIPTION AGREEMENT
WITH THE HOLDER CONTAINS ADDITIONAL PROVISIONS RESTRICTING THE TRANSFER OF THIS
WARRANT. A COPY OF SUCH AGREEMENT IS AVAILABLE FOR INSPECTION AT THE COMPANY'S
OFFICE.
For the Purchase of
shares of
Warrant No. _______ Common Stock
Date of Original Issuance: As of November 27, 1996
WARRANT FOR THE PURCHASE OF
SHARES OF COMMON STOCK
OF
DENTAL/MEDICAL DIAGNOSTIC SYSTEMS, INC.
(A DELAWARE CORPORATION)
Dental/Medical Diagnostic Systems, Inc., a Delaware corporation
("Company"), hereby certifies that
("Registered Holder"), is entitled, subject to the terms set forth
below, to purchase from the Company, at any time or from time to time during the
period commencing on the first anniversary of the Date of Original Issuance set
forth above and ending on the day immediately prior to the sixth anniversary of
the Date of Original Issuance set forth above, shares of Common Stock, $.01 par
value, of the Company ("Common Stock"), at an initial exercise price equal to
$2.00 per share (subject to adjustment as provided below); provided, however,
upon the effective date ("Commencement Date") of the registration statement with
respect to the public offering ("Offering") of the Company's securities as
contemplated by the letter of intent dated August 9, 1996, as amended ("Letter
of Intent") between the Company and X.X. Xxxxxxxx & Co., Inc. ("MHM"), this
Warrant shall automatically convert (on a one-for-one basis) into the warrants
to be issued as part of the securities to be sold to the public in the Offering.
The number of shares of Common Stock purchasable upon exercise of this Warrant,
and the exercise price per share, each as adjusted from time to time pursuant to
the provisions of this Warrant, are hereinafter referred to as the "Warrant
Stock" and the "Exercise Price," respectively.
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1. Exercise.
(a) This Warrant may be exercised by the Registered Holder, in whole or
in part, by surrendering this Warrant, with the purchase form appended hereto as
Exhibit I duly executed by such Registered Holder, at the principal office of
the Company, or at such other office or agency as the Company may designate,
accompanied by payment in full, in lawful money of the United States, of the
Exercise Price payable in respect of the number of shares of Warrant Stock
purchased upon such exercise.
(b) Each exercise of this Warrant shall be deemed to have been effected
immediately prior to the close of business on the day on which the Warrant shall
have been surrendered to the Company as provided in subsection 1(a) above. At
such time, the person or persons in whose name or names any certificates for
Warrant Stock shall be issuable upon such exercise as provided in subsection
1(c) below shall be deemed to have become the holder or holders of record of the
Warrant Stock represented by such certificates.
(c) As soon as practicable after the exercise of this Warrant in full
or in part, and in any event within 10 days thereafter, the Company at its
expense will cause to be issued in the name of, and delivered to, the Registered
Holder, or, subject to the terms and conditions hereof, as such Holder (upon
payment by such Holder of any applicable transfer taxes) may direct:
(i) a certificate or certificates for the number of full shares of
Warrant Stock to which such Registered Holder shall be entitled upon such
exercise plus, in lieu of any fractional share to which such Registered Holder
would otherwise be entitled, cash in an amount determined pursuant to Section 3
hereof, and
(ii) in case such exercise is in part only, a new warrant or
warrants (dated the date hereof) of like tenor, calling in the aggregate on the
face or faces thereof for the number of shares of Warrant Stock equal (without
giving effect to any adjustment therein) to the number of such shares called for
on -the face of this Warrant, minus the number of such shares purchased by the
Registered Holder upon such exercise as provided in subsection 1(a) above.
2. Adjustments.
(a) If the outstanding shares of the Company's Common Stock shall be
subdivided or split into a greater number of shares, or a dividend in Common
Stock shall be paid in respect of Common Stock, the Exercise Price in effect
immediately prior to such subdivision or at the record date of such dividend
shall simultaneously with the effectiveness of such subdivision or split or
immediately after the record date of such dividend be proportionately reduced.
If the outstanding shares of Common Stock shall be combined or reverse-split
into a smaller number of shares, the Exercise Price in effect immediately prior
to such combination or reverse-split shall, simultaneously with the
effectiveness of such combination or reverse-split, be proportionately
increased. When any adjustment is required to be made in the Exercise Price, the
number of shares of Warrant Stock purchasable upon the exercise of this Warrant
shall be changed to the number determined by dividing (i) an amount equal to the
number of shares issuable upon the exercise of this Warrant immediately prior to
such adjustment, multiplied by the Exercise Price in effect immediately prior to
such adjustment, by (ii) the Exercise Price in effect immediately after such
adjustment.
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(b) If there shall occur any capital reorganization or
reclassification of the Company's Common Stock (other than a change in par value
or a subdivision or combination as provided for in subsection 2(a) above), or
any consolidation or merger of the Company with or into another corporation, or
a transfer of all or substantially all of the assets of the Company, or the
payment of a liquidating distribution, then, as part of any such reorganization,
reclassification, consolidation, merger, sale or liquidating distribution,
lawful provision shall be made so that the Registered Holder of this Warrant
shall have the right thereafter to receive upon the exercise hereof (to the
extent, if any, still exercisable) the kind and amount of shares of stock or
other securities or property which such Registered Holder would have been
entitled to receive if, immediately prior to any such reorganization,
reclassification, consolidation, merger, sale or liquidating distribution, as
the case may be, such Registered Holder had held the number of shares of Common
Stock which were then purchasable upon the exercise of this Warrant. In any such
case, appropriate adjustment (as reasonably determined by the Board of Directors
of the Company) shall be made in the application of the provisions set forth
herein with respect to the rights and interests thereafter of the Registered
Holder of this Warrant such that the provisions set forth in this Section 2
(including provisions with respect to adjustment of the Exercise Price) shall
thereafter be applicable, as nearly as practicable, in relation to any shares of
stock or other securities or property thereafter deliverable upon the exercise
of this Warrant.
(c) No adjustment in the per share Exercise Price shall be
required unless such adjustment would require an increase or decrease in the
Exercise Price of at least $0.01; provided, however, that any adjustments which
by reason of this paragraph are not required to be made shall be carried forward
and taken into account in any subsequent adjustment. All calculations under this
Section 2 shall be made to the nearest cent or to the nearest 1/100th of a
share, as the case may be. Anything in this Section 2 to the contrary
notwithstanding, the Company shall be entitled to make such reductions in the
per share Exercise Price, in addition to those required by this Section 2 as in
its discretion it shall deem to be advisable in order that any stock dividend,
subdivision of shares or distribution rights to purchase stock or securities
convertible or exchangeable for stock hereafter made by the Company to its
stockholders shall not be taxable.
(d) Upon the happening of any event requiring an adjustment of the
Exercise Price hereunder, the Company shall forthwith give written notice
thereto to the Registered Holder of this Warrant stating the adjusted Exercise
Price and the adjusted number of shares purchasable upon the exercise hereof
resulting from such event and setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based.
3. Fractional Shares. The Company shall not be required upon the
exercise of this Warrant to issue any fractional shares, but shall make an
adjustment therefor in cash on the basis of the mean between the low bid and
high asked prices for the Warrant Stock on the over-the-counter market as
reported by the National Association of Securities Dealers Automated Quotation
System or the closing market price of the Warrant Stock on a national securities
exchange on the trading day immediately prior to the date of exercise, whichever
is applicable, or if neither is applicable, then on the basis of the then fair
market value of the Warrant Stock as shall be reasonably determined by the Board
of Directors of the Company.
4. Limitation on Sales, etc. Each holder of this Warrant acknowledges
that this Warrant and the Warrant Stock have not been registered under the
Securities Act of 1933, as now in force or hereafter amended, or any successor
legislation ("Act"), and agrees not to sell, pledge, distribute,
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offer for sale, transfer or otherwise dispose of this Warrant or any Warrant
Stock issued upon its exercise in the absence of (a) an effective registration
statement under the Act as to this Warrant and the Warrant Stock issued upon its
exercise and registration or qualification of this Warrant or such Warrant Stock
under any applicable Blue Sky or state securities law then in effect, or (b) an
opinion of counsel, satisfactory to the Company, that such registration and
qualification are not required. Notwithstanding the foregoing, the holder
acknowledges that it may not sell the Warrant or any Warrant Shares for a period
of twenty-four months from the date of issuance of this Warrant without the
prior written consent of MHM, which consent may be withheld at MHM's sole
discretion and may be withheld if requested by Nasdaq or the National
Association of Securities Dealers, Inc. as a prerequisite to listing the
Company's securities on Nasdaq.
Without limiting the generality of the foregoing, unless the
offering and sale of the Warrant Stock to be issued upon the exercise of the
Warrant shall have been effectively registered under the Act, the Company shall
be under no obligation to issue the shares covered by such exercise unless and
until the Registered Holder shall have executed an investment letter in form and
substance reasonably satisfactory to the Company, including a warranty at the
time of such exercise that it is acquiring such shares for its own account, for
investment and not with a view to, or for sale in connection with, the
distribution of any such shares, in which event the Registered Holder shall be
bound by the provisions of a legend or legends to such effect which shall be
endorsed upon the certificates) representing the Warrant Stock issued pursuant
to such exercise.
5. Certain Dividends. If the Company pays a dividend or makes a
distribution on the Common Stock payable otherwise than in cash out of earnings
or earned surplus (determined in accordance with generally accepted accounting
principles) except for a stock dividend payable in shares of Common Stock (a
"Property Dividend"), then the Company will pay or distribute to the Registered
Holder of this Warrant, upon the exercise hereof, in addition to the Warrant
Stock purchased upon such exercise, the Property Dividend which would have been
paid to such Registered Holder if the Registered Holder had been the owner of
record of such shares of Warrant Stock immediately prior to the date on which a
record is taken for such Property Dividend or, if no record is taken, the date
as of which the record holders of Common Stock entitled to such dividends or
distribution are to be determined.
6. Rights of Warrant Holder.
The Company has agreed to register the Public Warrant that this
Warrant shall be converted into (and the underlying Warrant Stock) in connection
with the Offering and in connection with certain offerings by the Company, all
as set forth in Section 7 of the Subscription Agreement between the Company and
the Registered Holder pursuant to which this Warrant has been issued.
On the effective date of the registration statement utilized in
the Offering, the Registered Holder shall have the same rights (subject to the
restriction specified in Section 4 hereof) with respect to this Warrant as the
holders of the warrants issued to the public in the Offering and the Registered
Holder shall exchange this Warrant for the form of warrant issued to the public
in the Offering. Such new warrant and the rights of the Registered Holder shall
be governed by the warrant agreement executed in connection with the Offering.
Some of the rights of the Registered Holder reflected herein will not be
reflected in such warrant agreement, since the terms of the warrants to be
issued to the public in the Offering will be different, in certain respects,
from the terms of this Warrant.
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7. Notices of Record Date, etc. In case:
(a) the Company shall take a record of the holders of its Common
Stock (or other securities at the time issuable upon the exercise of this
Warrant) for the purpose of entitling or enabling them to receive any dividend
or other distribution (other than a dividend or distribution payable solely in
capital stock of the Company or out of funds legally available therefor), or to
receive any right to subscribe for or purchase any shares of stock of any class
or any other securities, or to receive any other right; or
(b) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company with or into another corporation (other than a
consolidation or merger in which the Company is the surviving entity), or any
transfer of all or substantially all of the assets of the Company; or
(c) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company;
then, and in each such case, the Company will mail or cause to be mailed to the
Registered Holder of this Warrant a notice specifying, as the case may be, (i)
the date on which a record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such dividend,
distribution or right, or (ii) the effective date on which such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up is to take place, and the time, if any is to be fixed, as of which
the holders of record of Common Stock (or such other stock or securities as are
at the time issuable upon the exercise of this Warrant) shall be entitled to
exchange their shares of Common Stock (or such other stock or securities) for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up. Such notice shall be mailed at least ten (10) days prior to the
record date or effective date, for the event specified in such notice, provided
that the failure to mail such notice shall not affect the legality or validity
of any such action.
8. Reservation of Stock. The Company will at all times reserve and keep
available, solely for issuance and delivery upon the exercise of this Warrant,
such shares of Warrant Stock and other stock, securities and property, as from
time to time shall be issuable upon the exercise of this Warrant.
9. Replacement of Warrants. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.
10. Transfers, etc. The Company will maintain a register containing the
names and addresses of the Registered Holders of this Warrant and of the holders
of other warrants of like tenor issued simultaneously hereunder. Any Registered
Holder may change its, his or her address as shown on the warrant register by
written notice to the Company requesting such change.
Until any transfer of this Warrant is made in the warrant
register, the Company may treat the Registered Holder of this Warrant as the
absolute owner hereof for all purposes; provided,
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however, that if and when this Warrant is properly assigned in blank, the
Company may (but shall not be obligated to) treat the bearer hereof as the
absolute owner hereof for all purposes, notwithstanding any notice to the
contrary.
11. Mailing of Notices, etc. All notices and other communications from
the Company to the Registered Holder of this Warrant shall be mailed by
first-class certified or registered mail, postage prepaid, sent by reputable
overnight delivery or by facsimile to the address furnished to the Company in
writing by the last Registered Holder of this Warrant who shall have furnished
an address to the Company in writing. All notices and other communications from
the Registered Holder of this Warrant or in connection herewith to the Company
shall be mailed by first-class certified or registered mail, postage prepaid,
sent by reputable overnight delivery or by facsimile to the Company at its
offices at 000 X. Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxxx Xxxxxxx, XX 00000, or
such other address as the Company shall so notify the Registered Holder.
12. No Rights as Stockholders. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a stockholder of the Company.
13. Change or Waiver. Any term of this Warrant may be changed or waived
only by an instrument in writing signed by the party against whom enforcement of
the change or waiver is sought.
14. Headings. The headings of this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
15. Governing Law. This Warrant will be governed by and construed in
accordance with the law of the State of New York without regard to the
principles of conflict of law.
16. Venue. The Company (a) agrees that any legal suit, action or
proceeding arising out of or relating to this Warrant shall be instituted
exclusively in New York State Supreme Court, County of New York or in the United
States District Court for the Southern District of New York, (b) waives any
objection to the venue of any such suit, action or proceeding and the right to
assert that such forum is not a convenient forum, and (c) irrevocably consents
to the jurisdiction of the New York State Supreme Court, County of New York, and
the United States District Court for the Southern District of New York in any
such suit, action or proceeding. The Company further agrees to accept and
acknowledge service of any and all process which may be served in any such suit,
action or proceeding in the New York State Supreme Court, County of New York, or
in the United States District Court for the Southern District of New York and
agrees that service of process upon it mailed by certified mail to its address
shall be deemed in every respect effective service of process upon it in any
such suit, action or proceeding.
Dated: As of November 27, 1996 DENTAL/MEDICAL DIAGNOSTIC SYSTEMS, INC.
By: XXXXXX X. XXXXXXXXX
--------------------------------------
Xxxxxx X. Xxxxxxxxx
CEO/Chairman
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EXHIBIT I
PURCHASE FORM
To: Dental/Medical Diagnostic Systems, Inc.
000 X. Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxx Xxxxxxx, XX 00000
Dated:
In accordance with the provisions set forth in the attached Warrant
(No. ), the undersigned hereby irrevocably elects to purchase shares of
the Common Stock covered by such Warrant and herewith makes payment of $ ,
representing the full Exercise Price for such shares at the price per share
provided for in such Warrant.
The undersigned has had the opportunity to ask questions of and receive
answers from the officers of the Company regarding the affairs of the Company
and related matters, and has had the opportunity to obtain additional
information necessary to verify the accuracy of all information so obtained.
The undersigned understands that the shares have not been registered
under the Securities Act of 1933, as amended, or the securities laws of any
other jurisdiction, and hereby represents to the Company that the undersigned is
acquiring the shares for its own account, for investment, and not with a view
to, or for sale in connection with, the distribution of any such shares.
Signature________________________________
Address__________________________________
__________________________________
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DENTAL/MEDICAL DIAGNOSTIC SYSTEMS, INC.
SCHEDULE OF WARRANT HOLDERS
NUMBER OF SHARES
NAME OF WARRANT HOLDER ADDRESS ISSUABLE
------------------------------------ ----------------------------- ----------------
Bear Xxxxxxx Securities Corp. as XXX 000 Xxxx Xxxxxx 12,500
Custodian FBO Xxxx Xxxxxxx Xxx Xxxx, XX 00000
Attn: Associate Director
Bear Xxxxxxx Securities Corp. as XXX 000 Xxxx Xxxxxx 25,000
Custodian FBO Xxxxx X. Xxxx Xxx Xxxx, XX 00000
Attn: Associate Director
Bear Xxxxxxx Securities Corp. as XXX 000 Xxxx Xxxxxx 12,500
Custodian FBO Xxxxxx Xxxx New York, NY 10167
Attn: Associate Director
Xxxxx X. Xxxx 00 Xxxxxxxxx Xxxx 25,000
Xxxxxxx, XX 00000
Xxxxxxx X. Xx Xxxxx 0000 Xxxxxxxxxxx Xxxx 25,000
Xxxxxxx, XX 00000
Xxxxxxx Fund 000 Xxxx 00xx Xxxxxx 25,000
Limited Partnership Xxxxxxxx, XX 00000-0000
Attn: Xxxxxx X. Xxxxxxx
Bear Xxxxxxx Securities Corp. as Custodian c/o Xxxx X. Xxxxxx, MD 12,500
FBO Empire Medical Diagnostic PC Defined 3 Arista Court
Contribution Profit Sharing Plan Xxx Xxxxx, XX 00000
Xxxxxx X. Xxxxx 000 Xxxxxxx Xxxx 00,000
Xxxxxxxxxx, XX 00000
Xxxxx Xxxxxxx 000 Xxxxx Xxxx 00,000
Xxxxxxxx Xxxxx, XX 00000
Xxxxxxx Xxxxxxx 0000 Xxxxx Xxxx, N-603 12,500
Xxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxxxx 000 Xxxxxxxxx Xxxxx 00,000
Xxxxxxx, XX 00000-0000
Xxxxxx Xxxxx-Nesses 000 Xxxxxxxxx Xxxxx 00,000
Xxxxxxxx Xxxxx, XX 00000
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NUMBER OF SHARES
NAME OF WARRANT HOLDER ADDRESS ISSUABLE
------------------------------------ ----------------------------- ----------------
H&S Advisors, Inc. 000 Xxx Xxxxx Xxxxxxx 00,000
Xxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxx, M.D.
and/or Xxxxxxx Xxxxxx
IF Consulting Ltd. 00 Xxxx Xxxxxx Xxxxx 25,000
Nassau, Bahamas
Jo-Bar Enterprises, L.L.C. 0000 Xxxx Xxxx Xxxx Xxxxxx 25,000
0xx Xxxxx, Xxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxx
KCID Industries, c/o Xxxxxx X. Xxxxxxx, Xx., Atty 12,500
Xxxxxxx X. Xxxxxx 00 Xxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxxxxx 00000 X.X. 000xx Xxxxx 00,000
Xxxxx, XX 00000
Xxxxxxxxxx Xxxxx 000 Xxxxx Xxxx 00,000
Xxxxxxxx Xxxxx, XX 00000
Xxxxx Xxxxxxxxxx 00 Xxxx 00xx Xxxxxx, #0 00,000
Xxx Xxxx, XX 00000
Xxxxxxxxx Xxxx 00 Xxxxx Xxx 12,500
Xxxxxxxxx Xxxxx, XX 00000
Private Trust Corp. Charlotte House 25,000
Ltd: TTEE New Amsterdam Investment Box N65
Trust Nassau, Bahamas
Attn: Xxxxxx Xxxxxxx
Xxxxxx Xxxxx, M.D. 00 Xxxxxxxx Xxxx 25,000
Xxxxxxxx, XX 00000
Xxxx Xxxxxxx 00 Xxxxxxxxxx Xxxxxx 00,000
Xxxx Xxxxxx, XX 00000
Xxxxxxx X. Xxxxxxx 0 Xxxxxxxx Xxxx 00,000
Xxxxx Xxxxx, XX 00000
Xxxxxxx X. Xxxxxxx, Xx. 00 Xxxxxx Xxx 12,500
Xxxx Xxxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxxxx, Xx. 00 Xxxxxx Xxx 12,500
Trustee for Xxxxxxx Xxxx Xxxxxxxxxx, XX 00000
1990 GRIT dtd
7/30/90
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NUMBER OF SHARES
NAME OF WARRANT HOLDER ADDRESS ISSUABLE
------------------------------------ ----------------------------- ----------------
Xxxxxxx X. Xxxxxxx, Xx. 00 Xxxxxx Xxx 12,500
Trustee for Xxxxxxx Xxxx Xxxxxxxxxx, XX 00000
1995 GRAT dtd
3/2/95
Xxxxxxx Semble, M.D. 0 Xxxxxxxx Xxxxx 00,000
Xxx Xxxx, XX 00000
Dr. Xxxxx Sheer 000 Xxxxxxxxxx Xxxx Xxxx 00,000
Xxxxxxxx, XX 00000
Xxxxxxx Xxxxxx 000 Xxxx 00xx Xxxxxx 00,000
Xxx Xxxx, XX 00000
Xxxxxxx X. Xxxxxxx 000 Xxxx 00xx Xxxxxx, #0X 00,000
Xxx Xxxx, XX 00000
Xxxxx X. Xxxxxxxx 000 Xxxx 00xx Xxxxxx, #00X 12,500
Xxxxxx Trust Xxx Xxxx, XX 00000
800,000
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