Tennessee
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0-2585
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62-0183370
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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104 Nowlin Lane - Suite 101, Chattanooga, Tennessee
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37421
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(Address of principal executive offices)
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(zip code)
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(423) 510-7000
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(Registrant's telephone number, including area code)
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(10.2)
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Agreement to Reduce Security Deposit Amount and Amendment to Security Deposit Pledge Agreement, dated June 26, 2012.
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Date: June 27, 2012
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THE DIXIE GROUP, INC.
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/s/ Jon A. Faulkner
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Jon A. Faulkner
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Chief Financial Officer
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1.
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Lease Renewal Term.
Commencing as of the Amendment Effective Date, the term of the Lease shall continue for a renewal term indicated below (the “Renewal Term”). Periodic payments under each Lease during Renewal Term will be in the amount indicated below plus any applicable taxes (“Lease Payments”), payable in arrears on the 1st day of each month with the first Lease Payment being due on
July 1, 2012
. Such Lease Payments are for the leasing of the Equipment during the Renewal Term only and any service, maintenance and/or other supplies, consumables and/or products previously provided by any manufacturer, supplier, vendor and/or service providers to the Lessee in conjunction with the leasing of Equipment will no longer be applicable and are not included in the Lease or Lease Payments during the Renewal Term.
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2.
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Purchase Option Amount Upon Expiration of Renewal Term.
Upon expiration of the Renewal Term, the purchase price for the end of term purchase option to be paid to Lessor for the Equipment under each Lease will be
Fair Market Value
, plus an amount equal to the Lease Payments and all other amounts then unpaid under the terms of such Lease, plus applicable taxes, if any, on the above sum, all payable in cash or immediately available funds (“Purchase Option Amount”), and payable by Lessee to Lessor on the expiration date of the Renewal Term of such Lease.
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3.
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Additional Provisions during the Renewal Term.
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(a)
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Upon expiration of the Renewal Term of each Lease, Lessor hereby grants to Lessee the option to purchase for immediately available funds all, but not less than all, of the Equipment, under such Lease at the Purchase Option Amount set forth above provided that Lessee is not then in default under the terms of such Lease and Lessee gives Lessor at least 30, but not more than 90, days prior written notice of its intent to purchase the Equipment. Upon full payment of such Purchase Option Amount by Lessee, Lessor will (upon Lessee's written request and at Lessee's expense) execute a bill of sale conveying title to the Equipment to Lessee on an “AS IS, WHERE IS” BASIS WITHOUT RECOURSE TO OR REPRESENTATIONS OR WARRANTIES OF ANY KIND FROM LESSOR, EXPRESS OR IMPLIED, AND SUBJECT TO ALL OF LESSOR'S DISCLAIMERS SET FORTH IN SUCH LEASE. All previous purchase options that were originally granted in conjunction with any Lease will no longer be applicable and shall be deleted in their entirety.
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(b)
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During the Renewal Term, the Stipulated Loss Value and/or Termination Value for any Equipment shall be equal to its capitalized lessor's cost or total cost (as such amount is specified in the Lease of such Equipment) multiplied by the appropriate percentage set forth in Exhibit A hereto.
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(c)
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Early Purchase Option:
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4.
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Third Party Consents Required.
Each Guarantor (if any) will execute and deliver to Lessor this Agreement or such other consent and acknowledgement of the continuance of their obligations and liabilities under the Lease Documents as Lessor may require.
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5.
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Representations, Warranties and Covenants of Lessee.
In order to induce Lessor to enter into this Agreement, Lessee hereby represents and warrants to Lessor that as of the Amendment Effective Date (a) the execution and delivery of this Agreement has been duly authorized, and all conditions and requirements have been satisfied and performed that are necessary to make this Agreement a valid and binding agreement, and to effect the renewal and amendment of each Lease as provided herein; (b) no default exists under any Lease Documents, (c) all of the representations and warranties of the Lessee in the Lease Documents to which it is a party are true and correct on the Amendment Effective Date as if the same were made on the date hereof and Lessee is in compliance with all of its affirmative and negative covenants provided in the Lease Documents to which it is a party, and (d) all of the warranties, representations, covenants and agreements of Lessee, and all the rights, immunities, powers and remedies of Lessor, that are set forth in the Lease Documents are incorporated herein and shall apply with the same force and effect as though set forth at length in this Agreement.
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6.
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Additional Covenants and Acknowledgments of Lessee.
In order to induce Lessor to enter into this Agreement, Lessee hereby covenants to Lessor that Lessee shall comply with all laws, rules and regulations applicable to Lessee, including without limitation, the USA PATRIOT ACT and all laws, rules and regulations relating to import or export controls, anti-money laundering and terrorist financing. Credit to Lessee's account for any Lease may be delayed if payment is (i) not received at the Lessor's payment address indicated in Lessor's invoice or other instructions from Lessor from time to time or (ii) not accompanied by Lessor's invoice number or (iii) not in immediately and legally available funds. Preferred forms of payment include direct debit, wires, company checks and certified checks of immediately and legally available funds. Payment in any other form may delay processing or be returned to Lessee. Delayed credit may cause Lessee to incur a late payment fee and/or trigger the occurrence of an event of default under the applicable Lease. All credit for payments of Lessee's account for this Lease is subject to final payment by the institution on which the item of payment was drawn.
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7.
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Maximum Lawful Rate.
The parties to the Lease intend to comply with any applicable law(s) governing the regulation of interest (if and to the extent that any Lease is determined to be subject to such laws). Accordingly, notwithstanding anything to the contrary in any Lease, in no event shall such Lease require the payment or permit the collection of interest or any amount in the nature of interest or fees in excess of the maximum amount permitted by applicable law. If for any reason the amount of any interest contracted for, charged or received under any Lease shall exceed the maximum amount of interest permitted by applicable law, then (i) any such excess which may have been collected shall, at Lessor's option, be either applied to amounts that are lawfully due and owing under such Lease or refunded to Lessee, and (ii) the effective rate of interest shall be automatically reduced to the maximum lawful contract rate allowed under applicable law as now or hereafter construed by a court of competent jurisdiction.
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8.
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Effectiveness of Amendment
. This Agreement is not binding nor effective with respect to any Lease or Equipment until executed on behalf of the parties hereto by their respective authorized representatives, and if required by Lessor, certificate of authority and incumbency of each Lessee and Guarantor (if any), evidence that the Equipment is insured pursuant to the provisions of the applicable Lease, and evidence that Lessor's interest with respect to each Lease and Equipment is properly perfected, each in form and substance satisfactory to Lessor. All references in a Lease or this Agreement to such Lease shall be deemed to mean and refer to such Lease, as amended by this Agreement, and as the same may be further amended, amended and restated, extended, renewed or otherwise modified from time to time. Except as expressly modified herein, all terms and provisions of each Lease shall remain in full force and effect.
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9.
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Further Assurances.
If and to the extent that any Lease is deemed a security agreement during the Renewal Term, Lessee hereby grants to Lessor a first priority security interest in the Equipment, together with all additions, attachments, accessories and accessions thereto whether or not furnished by supplier of the Equipment and any and all substitutions, upgrades, replacements or exchanges therefor, and any and all insurance and/or other proceeds of the property in and against which a security interest is granted hereunder. Lessee will promptly, upon Lessor's reasonable request and at Lessee's sole cost and expense, take such further action, and execute, or otherwise authenticate, any document, record or instrument necessary or expedient for filing, recording or perfecting the interest of Lessor or to carry out the intent of this Agreement and any Lease.
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10.
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Counterparts
. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, all of which taken together shall constitute one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. Delivery of an executed signature page of this Agreement or any delivery contemplated hereby by facsimile or electronic transmission shall be as effective as delivery of a manually executed counterpart thereof.
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11.
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Miscellaneous.
This Agreement may not be amended, altered, modified or otherwise changed except in writing executed by the parties hereto expressly stating that it is an amendment to this Agreement. This Agreement sets forth the entire agreement between the parties hereto, and supersedes any and, all prior agreements or understandings between the parties hereto relating to the subject matter hereof. This Agreement shall not be construed more strictly against either party by virtue of the preparation hereof.
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Equipment Description
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Serial No. or VIN
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Capitalized Lessor's Cost
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As listed and more particularly described in the Lease.
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$
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2,825,697.64
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Total:
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Rent Payment
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Termination Value %
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Stipulated Loss Value %
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Rent Payment
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Termination Value %
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Stipulated Loss Value %
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1
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102.28
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106.23
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31
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64.43
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67.68
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2
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101.13
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105.06
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32
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63.06
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66.28
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3
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99.97
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103.87
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33
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61.68
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64.88
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4
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98.80
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102.68
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34
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60.29
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63.46
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5
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97.62
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101.48
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35
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58.89
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62.04
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6
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96.44
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100.27
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36
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57.48
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60.61
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7
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95.24
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99.06
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37
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56.07
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59.17
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8
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94.04
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97.83
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38
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54.65
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57.73
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9
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92.83
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96.60
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39
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53.22
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56.28
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10
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91.62
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95.36
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40
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51.78
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54.82
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11
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90.39
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94.11
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41
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50.34
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53.35
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12
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89.16
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92.86
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42
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48.89
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51.87
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13
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87.93
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91.60
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43
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47.43
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50.39
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14
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86.68
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90.33
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44
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45.96
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48.90
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15
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85.43
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89.05
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45
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44.48
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47.40
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16
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84.17
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87.77
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46
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43.00
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45.89
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17
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82.91
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86.48
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47
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41.51
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44.38
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18
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81.64
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85.19
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48
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40.00
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42.85
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19
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80.36
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83.89
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49
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38.51
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41.33
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20
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79.07
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82.57
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50
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37.00
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39.80
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21
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77.78
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81.26
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51
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35.47
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38.24
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22
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76.47
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79.93
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52
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33.95
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36.70
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23
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75.17
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78.60
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53
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32.42
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35.15
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24
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73.85
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77.26
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54
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30.81
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33.52
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25
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72.53
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75.92
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55
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29.21
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31.90
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26
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71.20
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74.56
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56
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27.65
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30.31
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27
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69.86
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73.20
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57
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26.10
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28.74
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28
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68.51
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71.83
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58
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24.54
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27.16
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29
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67.16
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70.46
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59
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22.98
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25.57
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30
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65.80
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69.07
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60
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21.41
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24.02
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GE
Capital
c/o Corporate Finance - East Region
10 Riverview Drive
Danbury, CT 06810
T (203) 749-6000
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