1-10799
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73-1351610
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(Commission file Number)
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(IRS Employer Identification No.)
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1221 E. Houston, Broken Arrow Oklahoma
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74012
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(Address of Principal Executive Offices)
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(Zip Code)
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Written Communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4© under the Exchange Act (17 CFR 240.13e-4(c))
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Exhibit 10.1
Exhibit 10.2
Exhibit 10.3
Exhibit 99.1
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Addendum No. 2 to Agreement for Purchase and Sale of Real Estate dated as of October 31, 2018, between ADDvantage Technologies Group, Inc. as Seller and David Chymiak as Buyer.
Addendum No. 3 to Agreement for Purchase and Sale of Real Estate dated as of November 9, 2018, by and among ADDvantage Technologies Group, Inc. as Seller, David Chymiak as Original Buyer and David Chymiak, LLC as Buyer.
Lease Agreement dated as of November 29, 2018 between David Chymiak, LLC as Lessor and Tulsat, LLC as Lessee.
Press Release dated December 4, 2018, issued by the Company.
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SIGNATURES
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ADDVANTAGE TECHNOLOGIES GROUP, INC.
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Date: December 4, 2018
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By: /s/ Scott Francis
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Scott Francis
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Vice-President & Chief Financial Officer
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Exhibit Number
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Description
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Exhibit 10.1
Exhibit 10.2
Exhibit 10.3
Exhibit 99.1
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Addendum No. 2 to Agreement for Purchase and Sale of Real Estate dated as of October 31, 2018, between ADDvantage Technologies Group, Inc. as Seller and David Chymiak as Buyer.
Addendum No. 3 to Agreement for Purchase and Sale of Real Estate dated as of November 9, 2018, by and among ADDvantage Technologies Group, Inc. as Seller, David Chymiak as Original Buyer and David Chymiak, LLC as Buyer.
Lease Agreement dated as of November 29, 2018 between David Chymiak, LLC as Lessor and Tulsat, LLC as Lessee.
Press Release dated December 4, 2018, issued by the Company.
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"Buyer"
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"Seller"
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/s/ David Chymiak
David Chymiak
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ADDvantage Technologies Group, Inc.
an Oklahoma corporation
By /s/ Scott Francis
Printed Name: Scott Francis
Title: CFO
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(a)
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Definition of Additional Rent. "Additional Rent" shall mean all costs
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and expenses to be paid by Lessee as additional rent under this Lease as further set forth and described in Sections 2.2, 5.5 and 11.3.
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(b)
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Additional Rent Based on Real Estate Taxes. As Additional Rent, Lessee shall pay Lessor the annual real estate taxes and assessments assessed and levied against the Premises, on the first (1st) day of each month, in advance, in a sum equal to one-twelfth (1/12th) of the annual real estate taxes and assessments due and payable for the then calendar year. If at a time a payment is required the amount of the real estate taxes and assessments for the then calendar year shall not be known, Lessee shall pay Lessor, as Additional Rent, one-twelfth (1/12th) of the real estate taxes and assessments for the preceding calendar year and upon ascertaining the real estate taxes and assessments for the current calendar year, Lessee shall pay Lessor any difference upon demand, or if Lessee shall be entitled to a credit, Lessor shall credit the excess against the next monthly installment(s) of Additional Rent due, or if at the end of the Term, then paid in full to Lessee. Additional Rent based upon real estate taxes and assessments payable for the first and last years' of the Term shall be adjusted and prorated, so that Lessor shall be responsible for Lessor's prorated share for the period prior to and subsequent to the Term, and Lessee shall pay Lessor its prorated share for the Term. Provided this Lease is not previously cancelled or terminated, and there shall be no Event of Default, or an event that with the giving of notice or the lapse of time, or both, would constitute an Event of Default, then Lessee shall have the right to contest the amount or validity of any real estate tax or assessment assessed and levied against the Premises, or to seek a reduction in the valuation of the buildings on the Premises assessed for real estate tax purposes, by appropriate proceedings diligently conducted in good faith (the "Tax Appeal"), but only after payment of such taxes and assessments. Except as set forth below, Lessor stall not be required to join in any Tax Appeal. If required by law, Lessor shall, upon written request of Lessee, join in the Tax Appeal or permit the Tax Appeal to be brought in Lessor's name, and Lessor shall reasonably cooperate with Lessee, at the cost and expense of Lessee. Lessee shall pay any increase that may result in real estate taxes or assessments as a consequence of the Tax Appeal, which payment obligations shall survive the expiration or earlier termination of this Lease.
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(c)
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Additional Rent Based Upon Assessments for Public Improvements.As Additional Rent, upon demand, Lessee shall pay Lessor all assessments for public improvements assessed and levied against the Premises. If any assessment for public improvements shall be payable in installments, Lessor shall pay such assessment in the maximum number of installments permitted by law, and Lessee's obligation to pay Additional Rent shall be limited to each installment thereof due and payable during the Term.
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(d)
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Additional Rent Based Upon Other Sums. Lessee shall pay Lessor, as Additional Rent, all other sums of money on Lessee's part to be paid pursuant to the terms and conditions of this Lease.
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(e)
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Additional Rent Based Upon Reimbursement to Lessor. If Lessee shall fail after applicable notice and cure periods to comply with or to perform any of the terms
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or conditions of this Lease, Lessor may (but with no obligation to do so) carry out and perform such terms or conditions, at the expense of Lessee, which expense shall be payable by Lessee, as Additional Rent, within ten (10) days after receipt of written demand of Lessor for reimbursement of such expenses, together with interest at the prime rate of eighteen percent (18%) per annum, which interest shall accrue from the date of Lessor's demand.
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(f)
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Additional Rent Based Upon Late Payment. In the event Lessee defaults for more than five (5) days in the payment of monthly installments of Base Rent, any Additional Rent or any of the sums required of Lessee under this Lease, or if Lessee fails to reimburse Lessor for any expenses incurred by Lessor pursuant to this Lease, together with interest, then after ten (10) days written notice to cure, Lessee shall pay Lessor, as Additional Rent, a late charge of five percent (5%) of the rent or expense.
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(g)
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Additional Rent Based Upon Lessor's Legal Expenses in Enforcing Lease. As Additional Rent, Lessee shall pay Lessor, all reasonable attorneys' fees that may be incurred by Lessor in enforcing Lessee's obligations under this Lease; provided, however, that in the event Lessor commences a suit against Lessee to enforce Lessee's obligations under this Lease, and such suit is tried to conclusion and judgment is entered in favor of Lessee, then in that event Lessee shall not be under any obligation to pay Lessor's attorneys' fees that Lessor may have incurred.
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(h)
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Taxes of Lessee's Personal Property. Lessee shall be liable for and shall pay not less than ten (10) days before delinquency, all taxes assessed against and levied upon Lessee's property. If any of Lessee's property is taxed or assessed in connection with the Premises, Lessor may pay the taxing authority all amounts billed to Lessor as a result thereof and Lessor may, but shall have no obligation to, determine the validity of any such assessment or otherwise object thereto. Lessee shall pay all such amounts to Lessor as Additional Rent within ten (10) days after receipt of written demand of Lessor for reimbursement of such expenses, together with interest at the prime rate of eighteen percent (18%) per annum, which interest shall accrue from the date of Lessor's demand.
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(i)
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Additional Rent Based Upon Taxes Based on Rent. If at any time during the Term, a tax or charge shall be imposed by the State of Oklahoma or the county or municipality in which the Premises is located, pursuant to any future law, which tax or charge shall be based upon the rent due or paid by Lessee to Lessor, then Lessee shall pay Lessor, as Additional Rent, such tax or charge. The foregoing shall not require payment by Lessee of any income taxes assessed against Lessor or of any capital levy, franchise, estate, succession, inheritance or transfer tax due from Lessor.
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(a)
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HVAC. Maintenance of the heating and air conditioning ("HVAC") equipment servicing the Premises shall be Lessee's sole responsibility throughout the Term. Lessee shall contract with a qualified and licensed HVAC contractor who will inspect and maintain the HVAC on a routine basis. Lessee will provide Lessor copies of the HVAC service contract and routine inspection reports upon demand. If Lessee fails, at any time during the Term, to execute and maintain a service contract for the HVAC equipment in compliance with this Section 3.3(a), Lessor may contract with a service company of its own choosing and bill Lessee for the cost of the same, plus an administration fee of ten percent (10%) on all HVAC expenses billed to Lessee. Any major repairs and/or replacement of any HVAC components will be Lessor's obligation unless such repair or replacement be necessitated as a result of the negligence or willful misconduct of Lessee, its affiliates or its or their invitees.
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(b)
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Alarm System. During the Term, Lessee shall contract with a reputable alarm monitoring company to provide alarm monitoring services at the Premises and provide evidence of such contract to Lessor upon demand. If Lessee fails, at any time during the Term, to execute and maintain a service contract for the alarm monitoring services in compliance with this Section 3.3(b), Lessor may contract with a service company of its own choosing and bill Lessee for the cost of the same, plus an administration fee of ten percent (10%) on all alarm service monitoring expenses billed to Lessee.
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(c)
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Damages Caused by Lessee. Notwithstanding anything contained herein to the contrary, any damage to the Premises caused by Lessee, its members, managers, officers, employees, agents, representatives, guests or invitees, shall be promptly repaired or replaced to its former condition by Lessee, at Lessee's own expense and as required by Lessor in its sole discretion.
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(d)
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Lessee's Negative Covenants. Lessee shall not injure, deface, permit waste nor otherwise harm any part of the Premises, permit any nuisance at the Premises or permit the emission of any objectionable noise or odor from the Premises.
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6.2
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Environmental Compliance.
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(a)
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Notice. Lessee shall give notice to Lessor at least seven (7) days in advance of any production, generation, handling, storage, treatment, transportation, disposal, release or removal of any Hazardous Substance from, on or within the Premises, and of any arrangement for transport, disposal, storage or treatment of any Hazardous Substance from, on or within the Premises. As used herein, the term "Hazardous Substance" shall mean any and all pollutants, contaminants, toxic or hazardous wastes or any other substances the use and/or removal of which is restricted, prohibited, regulated or penalized under or pursuant to any applicable environmental, health, safety or similar law, ordinance, order, rule or regulation now or at any time and from time to time. Notwithstanding the foregoing, Lessee may use and store on the Premises de minimis amounts of substances commonly used in the ordinary course of Lessee's business, provided that such use shall be in full compliance with all applicable laws.
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(b)
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Lessee's Covenants. Lessee covenants, warrants and represents that it will not use or employ all or any portion of the Premises to handle, transport, store, treat or dispose of any Hazardous Substance, whether or not it was generated or produced from, on or within the Premises; and Lessee further covenants, warrants and represents that any activity on or relating to the Premises shall be conducted in full compliance with all applicable laws.
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(c)
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Discharge. Lessee shall notify Lessor in writing within two (2) business days of (i) any spill, release, discharge or disposal of any Hazardous Substance in, on or under the Premises or any portion thereof, (ii) any matters where Lessee is required by law to give notice to any governmental or regulatory authority respecting any release of Hazardous Substances at or relating to the Premises, and (iii) any noncompliance by Lessee of any applicable environmental laws or breach by Lessee of the requirements set forth in this Section 6.2.
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(d)
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Investigation. Lessee shall promptly provide all information and sign all documents reasonably requested by Lessor with respect to compliance with this Section 6.2. Further, Lessor and its representatives shall have reasonable access to the Premises, from time to time, to conduct an environmental assessment, investigation and/or sampling of the Premises. Upon Lessor's reasonable suspicion that Hazardous Substances have been spilled, released, discharged or disposed of on the Premises, Lessor shall have the right, during the Term and upon the expiration or earlier termination of the Lease, to require that Lessee hire, and in such event Lessee shall, at Lessee's own expense, hire an environmental consultant satisfactory to Lessor to undertake sampling at the Premises sufficient to determine whether Hazardous Substances have been spilled, released, discharged or disposed of on the Premises during the Term.
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(e)
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Lessor's Right to Perform Lessee's Obligations. In the event, pursuant to this Lease, Lessee is required to undertake any sampling, assessment, investigation or remediation with respect to the Premises, then, at Lessor's reasonable discretion, Lessor shall have the right (but without any obligation to do so), upon notice to Lessee, from time to time, to perform such activities at Lessee's expense, and all reasonable sums incurred by Lessor shall be paid by Lessee, upon demand.
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(f)
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Indemnity. If the covenants, warranties and representations contained in this Section 6.2 are false or breached, Lessee agrees to defend, indemnify, protect and hold harmless Lessor against any and all Claims (hereinafter defined), that Lessor may be liable for, suffer, incur, or pay by reason of the false or breached covenants, warranties and representations. LESSEE ALSO AGREES TO DEFEND, INDEMNIFY, PROTECT AND HOLD HARMLESS LESSOR AGAINST ANY AND ALL CLAIMS WHICH LESSOR MAY HEREAFTER BE LIABLE FOR, SUFFER, INCUR OR PAY ARISING UNDER ANY APPLICABLE LAW AND RESULTING FROM OR ARISING OUT OF ANY ACT, ACTIVITY, OR VIOLATION OF ANY APPLICABLE LAWS ON THE PART OF LESSEE, ITS AGENTS, EMPLOYEES, OR ASSIGNS, AND AGAINST ANY AND ALL CLAIMS WHICH LESSOR MAY HEREAFTER BE LIABLE FOR, SUFFER, INCUR OR PAY RESULTING FROM OR ARISING OUT OF ANY HANDLING, STORAGE, TREATMENT, TRANSPORTATION, DISPOSAL, RELEASE OR THREAT OF RELEASE OF HAZARDOUS WASTE OR HAZARDOUS SUBSTANCES FROM, ON OR WITHIN THE PREMISES. The liability of Lessee pursuant to this Section 6.2 shall survive the expiration or earlier termination of this Lease.
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(g)
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Event of Default. Any violation or breach of this Section 6.2 shall be considered an Event of Default.
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(h)
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Claims. For purposes of this Section 6.2, the term "Claims" shall include and mean all actions, causes of action, whether common law or statutory, remedies, demands, out-of-pocket costs, liabilities, charges, suits, judgments, expense, damage, personal injuries, property damage, incidental or consequential damages, clean-up costs, civil penalties, attorneys' fees, litigation expenses, abatement costs, abatement and corrective injunctive relief, injunctive relief requiring removal and/or remedial action, all costs of removal or remedial action, and damages to natural resources.
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(a)
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Rent. If any Base Rent, Additional Rent or other monetary sum due hereunder remains unpaid for ten (10) days after written notice thereof to Lessee;
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(b)
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Insolvency. If Lessee becomes insolvent, performs any act of insolvency, is not generally paying its debts as the same become due or files a petition or has a petition filed against it, under any federal bankruptcy code or law, as amended;
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(c)
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Use of Premises. The Premises shall be used for purposes (i) other than those listed in Section 3.1 hereof or (ii) other than those approved in accordance with Section 3.1 hereof;
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(d)
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Lien. Lessor shall do or permit to be done anything that creates a lien on the Premises in violation of the terms of Section 4.5 hereof;
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(e)
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Environmental Compliance. Lessee shall violate the terms, conditions and provisions of Section 6.2 hereof;
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(f)
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Assignment. Lessee shall assign or sublet the Premises without consent of Lessor pursuant to Section 9.1 hereof;
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(g)
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Abandonment. If Lessee vacates or abandons the Premises pursuant to Section 10.2;
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(h)
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Failure to Perform. If Lessee fails to perform any of the terms, covenants, conditions or obligations of this Lease; or
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(i)
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Other Agreement. If there is a breach or default under any other agreement between Lessor and Lessee.
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(a)
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Termination. To terminate this Lease and take possession of the Premises;
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(b)
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Operate Lessee's Business. To reenter (which reentry shall not operate to terminate this Lease unless Lessor expressly so elects) and take possession of the Premises or any part thereof, any or all personal property or fixtures of Lessee upon the Premises and all franchises, licenses, permits and other rights or privileges of Lessee pertaining to the use and operation of the Premises and to conduct business thereon in the name of Lessor or of Lessee, but for the sole profit and benefit of Lessor and without compensation to Lessee;
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(c)
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Seize Property; Lien. To seize all personal property, equipment, furniture or fixtures upon the Premises which Lessee owns or in which it has an interest, against which property Lessor shall have a Lessor's lien and continuing security interest, which are hereby granted by Lessee, and to dispose of such property in accordance with laws prevailing at the time and place of such seizure or remove all or any portion of such property and cause the same to be stored in a public warehouse or elsewhere at the cost of Lessee;
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(d)
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Relet the Premises. To relet the Premises or any part thereof for such term or terms (including a term which extends beyond the original term of this Lease), at such rentals and upon such other terms as Lessor, in its sole discretion, may determine, with all proceeds of such reletting being applied to the rentals and other sums due from Lessee in such order as Lessor may, in its sole discretion, determine, with Lessee remaining liable for any deficiency;
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(e)
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Remaining Rent. To declare all Base Rent, Additional Rent and charges due hereunder to be immediately due and payable and thereupon all such amounts due to the end of the Term shall thereupon be accelerated. In the event that any charges due hereunder cannot be exactly determined as of the date of acceleration, the amount of such charges shall be determined by Lessor in a reasonable manner based on historical increases in such charges; or
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(f)
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Attorney's Fees. To recover from Lessee all expenses, but not limited to including attorney's fees, reasonably paid or incurred by Lessor as a result of such breach or default.
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(a)
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Definition of Additional Rent. "Additional Rent" shall mean all costs
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and expenses to be paid by Lessee as additional rent under this Lease as further set forth and described in Sections 2.2, 5.5 and 11.3.
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(b)
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Additional Rent Based on Real Estate Taxes. As Additional Rent, Lessee shall pay Lessor the annual real estate taxes and assessments assessed and levied against the Premises, on the first (1st) day of each month, in advance, in a sum equal to one-twelfth (1/12th) of the annual real estate taxes and assessments due and payable for the then calendar year. If at a time a payment is required the amount of the real estate taxes and assessments for the then calendar year shall not be known, Lessee shall pay Lessor, as Additional Rent, one-twelfth (1/12th) of the real estate taxes and assessments for the preceding calendar year and upon ascertaining the real estate taxes and assessments for the current calendar year, Lessee shall pay Lessor any difference upon demand, or if Lessee shall be entitled to a credit, Lessor shall credit the excess against the next monthly installment(s) of Additional Rent due, or if at the end of the Term, then paid in full to Lessee. Additional Rent based upon real estate taxes and assessments payable for the first and last years' of the Term shall be adjusted and prorated, so that Lessor shall be responsible for Lessor's prorated share for the period prior to and subsequent to the Term, and Lessee shall pay Lessor its prorated share for the Term. Provided this Lease is not previously cancelled or terminated, and there shall be no Event of Default, or an event that with the giving of notice or the lapse of time, or both, would constitute an Event of Default, then Lessee shall have the right to contest the amount or validity of any real estate tax or assessment assessed and levied against the Premises, or to seek a reduction in the valuation of the buildings on the Premises assessed for real estate tax purposes, by appropriate proceedings diligently conducted in good faith (the "Tax Appeal"), but only after payment of such taxes and assessments. Except as set forth below, Lessor stall not be required to join in any Tax Appeal. If required by law, Lessor shall, upon written request of Lessee, join in the Tax Appeal or permit the Tax Appeal to be brought in Lessor's name, and Lessor shall reasonably cooperate with Lessee, at the cost and expense of Lessee. Lessee shall pay any increase that may result in real estate taxes or assessments as a consequence of the Tax Appeal, which payment obligations shall survive the expiration or earlier termination of this Lease.
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(c)
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Additional Rent Based Upon Assessments for Public Improvements.As Additional Rent, upon demand, Lessee shall pay Lessor all assessments for public improvements assessed and levied against the Premises. If any assessment for public improvements shall be payable in installments, Lessor shall pay such assessment in the maximum number of installments permitted by law, and Lessee's obligation to pay Additional Rent shall be limited to each installment thereof due and payable during the Term.
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(d)
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Additional Rent Based Upon Other Sums. Lessee shall pay Lessor, as Additional Rent, all other sums of money on Lessee's part to be paid pursuant to the terms and conditions of this Lease.
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(e)
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Additional Rent Based Upon Reimbursement to Lessor. If Lessee shall fail after applicable notice and cure periods to comply with or to perform any of the terms
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or conditions of this Lease, Lessor may (but with no obligation to do so) carry out and perform such terms or conditions, at the expense of Lessee, which expense shall be payable by Lessee, as Additional Rent, within ten (10) days after receipt of written demand of Lessor for reimbursement of such expenses, together with interest at the prime rate of eighteen percent (18%) per annum, which interest shall accrue from the date of Lessor's demand.
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(f)
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Additional Rent Based Upon Late Payment. In the event Lessee defaults for more than five (5) days in the payment of monthly installments of Base Rent, any Additional Rent or any of the sums required of Lessee under this Lease, or if Lessee fails to reimburse Lessor for any expenses incurred by Lessor pursuant to this Lease, together with interest, then after ten (10) days written notice to cure, Lessee shall pay Lessor, as Additional Rent, a late charge of five percent (5%) of the rent or expense.
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(g)
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Additional Rent Based Upon Lessor's Legal Expenses in Enforcing Lease. As Additional Rent, Lessee shall pay Lessor, all reasonable attorneys' fees that may be incurred by Lessor in enforcing Lessee's obligations under this Lease; provided, however, that in the event Lessor commences a suit against Lessee to enforce Lessee's obligations under this Lease, and such suit is tried to conclusion and judgment is entered in favor of Lessee, then in that event Lessee shall not be under any obligation to pay Lessor's attorneys' fees that Lessor may have incurred.
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(h)
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Taxes of Lessee's Personal Property. Lessee shall be liable for and shall pay not less than ten (10) days before delinquency, all taxes assessed against and levied upon Lessee's property. If any of Lessee's property is taxed or assessed in connection with the Premises, Lessor may pay the taxing authority all amounts billed to Lessor as a result thereof and Lessor may, but shall have no obligation to, determine the validity of any such assessment or otherwise object thereto. Lessee shall pay all such amounts to Lessor as Additional Rent within ten (10) days after receipt of written demand of Lessor for reimbursement of such expenses, together with interest at the prime rate of eighteen percent (18%) per annum, which interest shall accrue from the date of Lessor's demand.
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(i)
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Additional Rent Based Upon Taxes Based on Rent. If at any time during the Term, a tax or charge shall be imposed by the State of Oklahoma or the county or municipality in which the Premises is located, pursuant to any future law, which tax or charge shall be based upon the rent due or paid by Lessee to Lessor, then Lessee shall pay Lessor, as Additional Rent, such tax or charge. The foregoing shall not require payment by Lessee of any income taxes assessed against Lessor or of any capital levy, franchise, estate, succession, inheritance or transfer tax due from Lessor.
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(a)
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HVAC. Maintenance of the heating and air conditioning ("HVAC") equipment servicing the Premises shall be Lessee's sole responsibility throughout the Term. Lessee shall contract with a qualified and licensed HVAC contractor who will inspect and maintain the HVAC on a routine basis. Lessee will provide Lessor copies of the HVAC service contract and routine inspection reports upon demand. If Lessee fails, at any time during the Term, to execute and maintain a service contract for the HVAC equipment in compliance with this Section 3.3(a), Lessor may contract with a service company of its own choosing and bill Lessee for the cost of the same, plus an administration fee of ten percent (10%) on all HVAC expenses billed to Lessee. Any major repairs and/or replacement of any HVAC components will be Lessor's obligation unless such repair or replacement be necessitated as a result of the negligence or willful misconduct of Lessee, its affiliates or its or their invitees.
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(b)
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Alarm System. During the Term, Lessee shall contract with a reputable alarm monitoring company to provide alarm monitoring services at the Premises and provide evidence of such contract to Lessor upon demand. If Lessee fails, at any time during the Term, to execute and maintain a service contract for the alarm monitoring services in compliance with this Section 3.3(b), Lessor may contract with a service company of its own choosing and bill Lessee for the cost of the same, plus an administration fee of ten percent (10%) on all alarm service monitoring expenses billed to Lessee.
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(c)
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Damages Caused by Lessee. Notwithstanding anything contained herein to the contrary, any damage to the Premises caused by Lessee, its members, managers, officers, employees, agents, representatives, guests or invitees, shall be promptly repaired or replaced to its former condition by Lessee, at Lessee's own expense and as required by Lessor in its sole discretion.
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(d)
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Lessee's Negative Covenants. Lessee shall not injure, deface, permit waste nor otherwise harm any part of the Premises, permit any nuisance at the Premises or permit the emission of any objectionable noise or odor from the Premises.
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6.2
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Environmental Compliance.
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(a)
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Notice. Lessee shall give notice to Lessor at least seven (7) days in advance of any production, generation, handling, storage, treatment, transportation, disposal, release or removal of any Hazardous Substance from, on or within the Premises, and of any arrangement for transport, disposal, storage or treatment of any Hazardous Substance from, on or within the Premises. As used herein, the term "Hazardous Substance" shall mean any and all pollutants, contaminants, toxic or hazardous wastes or any other substances the use and/or removal of which is restricted, prohibited, regulated or penalized under or pursuant to any applicable environmental, health, safety or similar law, ordinance, order, rule or regulation now or at any time and from time to time. Notwithstanding the foregoing, Lessee may use and store on the Premises de minimis amounts of substances commonly used in the ordinary course of Lessee's business, provided that such use shall be in full compliance with all applicable laws.
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(b)
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Lessee's Covenants. Lessee covenants, warrants and represents that it will not use or employ all or any portion of the Premises to handle, transport, store, treat or dispose of any Hazardous Substance, whether or not it was generated or produced from, on or within the Premises; and Lessee further covenants, warrants and represents that any activity on or relating to the Premises shall be conducted in full compliance with all applicable laws.
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(c)
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Discharge. Lessee shall notify Lessor in writing within two (2) business days of (i) any spill, release, discharge or disposal of any Hazardous Substance in, on or under the Premises or any portion thereof, (ii) any matters where Lessee is required by law to give notice to any governmental or regulatory authority respecting any release of Hazardous Substances at or relating to the Premises, and (iii) any noncompliance by Lessee of any applicable environmental laws or breach by Lessee of the requirements set forth in this Section 6.2.
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(d)
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Investigation. Lessee shall promptly provide all information and sign all documents reasonably requested by Lessor with respect to compliance with this Section 6.2. Further, Lessor and its representatives shall have reasonable access to the Premises, from time to time, to conduct an environmental assessment, investigation and/or sampling of the Premises. Upon Lessor's reasonable suspicion that Hazardous Substances have been spilled, released, discharged or disposed of on the Premises, Lessor shall have the right, during the Term and upon the expiration or earlier termination of the Lease, to require that Lessee hire, and in such event Lessee shall, at Lessee's own expense, hire an environmental consultant satisfactory to Lessor to undertake sampling at the Premises sufficient to determine whether Hazardous Substances have been spilled, released, discharged or disposed of on the Premises during the Term.
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(e)
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Lessor's Right to Perform Lessee's Obligations. In the event, pursuant to this Lease, Lessee is required to undertake any sampling, assessment, investigation or remediation with respect to the Premises, then, at Lessor's reasonable discretion, Lessor shall have the right (but without any obligation to do so), upon notice to Lessee, from time to time, to perform such activities at Lessee's expense, and all reasonable sums incurred by Lessor shall be paid by Lessee, upon demand.
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(f)
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Indemnity. If the covenants, warranties and representations contained in this Section 6.2 are false or breached, Lessee agrees to defend, indemnify, protect and hold harmless Lessor against any and all Claims (hereinafter defined), that Lessor may be liable for, suffer, incur, or pay by reason of the false or breached covenants, warranties and representations. LESSEE ALSO AGREES TO DEFEND, INDEMNIFY, PROTECT AND HOLD HARMLESS LESSOR AGAINST ANY AND ALL CLAIMS WHICH LESSOR MAY HEREAFTER BE LIABLE FOR, SUFFER, INCUR OR PAY ARISING UNDER ANY APPLICABLE LAW AND RESULTING FROM OR ARISING OUT OF ANY ACT, ACTIVITY, OR VIOLATION OF ANY APPLICABLE LAWS ON THE PART OF LESSEE, ITS AGENTS, EMPLOYEES, OR ASSIGNS, AND AGAINST ANY AND ALL CLAIMS WHICH LESSOR MAY HEREAFTER BE LIABLE FOR, SUFFER, INCUR OR PAY RESULTING FROM OR ARISING OUT OF ANY HANDLING, STORAGE, TREATMENT, TRANSPORTATION, DISPOSAL, RELEASE OR THREAT OF RELEASE OF HAZARDOUS WASTE OR HAZARDOUS SUBSTANCES FROM, ON OR WITHIN THE PREMISES. The liability of Lessee pursuant to this Section 6.2 shall survive the expiration or earlier termination of this Lease.
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(g)
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Event of Default. Any violation or breach of this Section 6.2 shall be considered an Event of Default.
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(h)
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Claims. For purposes of this Section 6.2, the term "Claims" shall include and mean all actions, causes of action, whether common law or statutory, remedies, demands, out-of-pocket costs, liabilities, charges, suits, judgments, expense, damage, personal injuries, property damage, incidental or consequential damages, clean-up costs, civil penalties, attorneys' fees, litigation expenses, abatement costs, abatement and corrective injunctive relief, injunctive relief requiring removal and/or remedial action, all costs of removal or remedial action, and damages to natural resources.
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(a)
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Rent. If any Base Rent, Additional Rent or other monetary sum due hereunder remains unpaid for ten (10) days after written notice thereof to Lessee;
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(b)
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Insolvency. If Lessee becomes insolvent, performs any act of insolvency, is not generally paying its debts as the same become due or files a petition or has a petition filed against it, under any federal bankruptcy code or law, as amended;
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(c)
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Use of Premises. The Premises shall be used for purposes (i) other than those listed in Section 3.1 hereof or (ii) other than those approved in accordance with Section 3.1 hereof;
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(d)
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Lien. Lessor shall do or permit to be done anything that creates a lien on the Premises in violation of the terms of Section 4.5 hereof;
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(e)
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Environmental Compliance. Lessee shall violate the terms, conditions and provisions of Section 6.2 hereof;
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(f)
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Assignment. Lessee shall assign or sublet the Premises without consent of Lessor pursuant to Section 9.1 hereof;
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(g)
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Abandonment. If Lessee vacates or abandons the Premises pursuant to Section 10.2;
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(h)
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Failure to Perform. If Lessee fails to perform any of the terms, covenants, conditions or obligations of this Lease; or
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(i)
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Other Agreement. If there is a breach or default under any other agreement between Lessor and Lessee.
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(a)
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Termination. To terminate this Lease and take possession of the Premises;
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(b)
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Operate Lessee's Business. To reenter (which reentry shall not operate to terminate this Lease unless Lessor expressly so elects) and take possession of the Premises or any part thereof, any or all personal property or fixtures of Lessee upon the Premises and all franchises, licenses, permits and other rights or privileges of Lessee pertaining to the use and operation of the Premises and to conduct business thereon in the name of Lessor or of Lessee, but for the sole profit and benefit of Lessor and without compensation to Lessee;
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(c)
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Seize Property; Lien. To seize all personal property, equipment, furniture or fixtures upon the Premises which Lessee owns or in which it has an interest, against which property Lessor shall have a Lessor's lien and continuing security interest, which are hereby granted by Lessee, and to dispose of such property in accordance with laws prevailing at the time and place of such seizure or remove all or any portion of such property and cause the same to be stored in a public warehouse or elsewhere at the cost of Lessee;
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(d)
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Relet the Premises. To relet the Premises or any part thereof for such term or terms (including a term which extends beyond the original term of this Lease), at such rentals and upon such other terms as Lessor, in its sole discretion, may determine, with all proceeds of such reletting being applied to the rentals and other sums due from Lessee in such order as Lessor may, in its sole discretion, determine, with Lessee remaining liable for any deficiency;
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(e)
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Remaining Rent. To declare all Base Rent, Additional Rent and charges due hereunder to be immediately due and payable and thereupon all such amounts due to the end of the Term shall thereupon be accelerated. In the event that any charges due hereunder cannot be exactly determined as of the date of acceleration, the amount of such charges shall be determined by Lessor in a reasonable manner based on historical increases in such charges; or
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(f)
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Attorney's Fees. To recover from Lessee all expenses, but not limited to including attorney's fees, reasonably paid or incurred by Lessor as a result of such breach or default.
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For further information
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KCSA Strategic Communications
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Company Contact:
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Elizabeth Barker
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Scott Francis (918) 251-9121
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(212) 896-1203
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ebarker@kcsa.com
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