AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 12, 2004

(MARK ONE)

96 CUMMINGS POINT ROAD, STAMFORD, CONNECTICUT

(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

06902

(ZIP CODE)

(203) 358-8000

(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

Indicate by check mark whether registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes [ ] No [X]

As of November 10, 2004, 17,130,354 shares of Common Stock, 1,096,622 shares of Series I Preferred Stock and 10,984,971 shares of Series J Preferred Stock were outstanding.

1

The accompanying notes are an integral part of these condensed consolidated financial statements.

2

The accompanying notes are an integral part of these condensed consolidated financial statements.

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This discussion and analysis of financial condition and results of operations reviews the results of operations of the Company, on a consolidated basis, for the three and nine months ended September 30, 2004 as compared to the three and nine months ended September 30, 2003. This discussion and analysis of financial condition and results of operations has been derived from, and should be read in conjunction with, the unaudited Condensed Consolidated Financial Statements and Notes to Condensed Consolidated Financial Statements contained herein.

The Company is a leading manufacturer and global distributor of educational, health, medical technology and agricultural products, primarily offered through catalogs.

The following is a summary of key events for the three and nine months ended September 30, 2004:

A key strength of the Company's business is its ability to generate cash consistently. The Board of Directors and management use cash generated as a measure of the Company's performance. The Company uses the cash generated from operations to strengthen the balance sheet, including reducing liabilities such as pensions and debt, paying dividends on its preferred stock and taking advantage of prudent acquisition opportunities. The Company's management believes that looking at the ability to generate cash provides investors with additional insight into the Company's performance.

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The following table sets forth selected financial data (i) as a percentage of net sales for the three and nine months ended September 30, 2004 and 2003 and (ii) the percentage change in dollars in those reported items from the comparable period in 2003:

1. "EBITDA," which is considered a non-GAAP financial measure, is defined as earnings before interest and other income, income taxes, depreciation and amortization. A non-GAAP financial measure is a numerical measure of a company's historical or future financial performance, financial position or cash flows that either excludes or includes amounts that are normally included or excluded in a comparable measure calculated and presented under GAAP. EBITDA is not presented as an alternative measure of operating results (such as earnings from operations or net earnings) or cash flow from operations, as determined in accordance with GAAP, but is presented because the Company's management believes it is a widely accepted indicator of the Company's current financial performance and ability to incur and service debt. EBITDA does not give effect to cash used for debt service requirements and thus does not reflect funds available for dividends, reinvestment or other discretionary uses. In addition, EBITDA as presented herein may not be comparable to similarly titled measures reported by other companies. The following table provides a reconciliation of net earnings to EBITDA for the three and nine months ended September 30 (in thou sands):

The Company is subject to seasonal influences with peak levels occurring in the second and third quarters of the fiscal year primarily due to increased educational shipments coinciding with the Fall start of new school years. As a result, the Company recognizes approximately 75% of its annual net earnings in the second and third quarters of its fiscal year. Inventory levels increase in March through June in anticipation of the peak shipping season. The majority of shipments are made between June and August and the majority of cash receipts are collected from August through October.

Quarterly results may also be materially affected by the timing of acquisitions, the timing and magnitude of costs related to such acquisitions, variations in costs of products sold, the mix of products sold and general economic conditions. Results for any quarter are not indicative of the results for any subsequent fiscal quarter or for a full fiscal year.

Net sales for the third quarter of 2004 increased 6.6% to $55.4 million from $52.0 million for the comparable period in 2003. The growth in net sales for the third quarter of 2004 is primarily attributable to organic growth and the overall stabilization of general national and international economic conditions compared to the volatility in the U.S. economy and budget uncertainty in the U.S. education sector which had affected the Company in the third quarter of 2003. Net sales in the educational segment, totaling $48.5 million, increased 6.7% in the third quarter of 2004 from $45.6 million in the third quarter of 2003. The commercial segment recorded net sales of $7.8 million in the third quarter of 2004 as compared to $7.5 million in the third quarter of 2003, increasing 4.3% versus the prior year.

Gross profit for the third quarter of 2004 increased 4.2% to $20.2 million from $19.3 million for the third quarter of 2003. The increase in gross profit for the third quarter of 2004 is primarily attributable to the 6.6% increase in net sales. Gross profit margin of 36.4% in the third quarter 2004 decreased from the 37.3% gross profit margin in the third quarter of 2003. Gross profit margin decreased as a result of a shift in the sales mix to lower margin quote business primarily in the educational segment. The educational segment yielded a gross profit of $18.6 million in the third quarter of 2004, improving on the third quarter of 2003 gross profit of $17.9 million. The educational segment gross profit margin decreased to 38.3% in the third quarter of 2004 from 39.3% for the comparable period in 2003. The commercial segment gross profit for the third quarter of 2004 increased 6.8% to $2.9 million from $2.7 million for the comparable period in 2003. The commercial segment yielded a gross profit margin of 37.2% in the third quarter of 2004, as compared to 36.3% in the third quarter of 2003.

Selling and administrative expenses for the third quarter of 2004 increased 5.5% to $10.9 million from $10.3 million in the comparable period in 2003. As a percent of net sales, selling and administrative expenses decreased to 19.7% in the third quarter of 2004 from 19.9% in the third quarter of 2003. Expenses included in this total include advertising and catalog costs, warehouse and shipping activities, customer service and general administrative functions. Selling and administrative expenses for the third quarter of 2004 were impacted by the following: (i) increase in salaries and wages of $.5 million as a result of annual employee compensation increases and employee performance incentives and (ii) an increase in group health costs by 31.0% to $.9 million in the third quarter of 2004.

The Company recorded $.2 million and $.1 million in compensation expense for the third quarters of 2004 and 2003, respectively, related to grants of stock options to certain employees and directors.

The Company incurred expenses of $.2 million to Geneve for certain administrative services for the third quarters of 2004 and 2003.

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Aristotle and its qualifying domestic subsidiaries are included in the Federal income tax return and certain state income tax returns of Geneve. The provision for income taxes for the Company is determined on a separate return basis in accordance with the terms of a tax sharing agreement with Geneve, and payments for current Federal and certain state income taxes are made to Geneve.

The income tax provision for the third quarter of 2004 was $1.4 million compared to $3.4 million for the comparable period in 2003. These tax provisions reflect effective tax rates of 15.7% and 39.5% for the third quarters of 2004 and 2003, respectively. For the third quarter of 2004, the difference between the Federal statutory income tax rate of 35% and the effective income tax rate results principally from reductions in the valuation allowance amounting to $1.4 million primarily related to increased estimates of projected taxable income, increases to other net deferred tax assets amounting to $.8 million, foreign income taxes and state income taxes,. For the third quarter of 2003, the difference between the Federal statutory income tax rate of 35% and the effective income tax rate results principally from foreign and state income taxes. Approximately $2.6 million of the income tax provision for the third quarters of 2004 and 2003 relates to the curre nt utilization of the Company's Federal net operating tax loss carryforwards. Although the reported earnings for the third quarters of 2004 and 2003 are shown after-tax, approximately $2.6 million of cash from operations was retained in the Company primarily as a result of the current utilization of these Federal net operating tax loss carryforwards. Except for Federal alternative minimum tax obligations arising from limitations on the utilization of Federal net operating tax loss carryforwards in 2004 and future years, the Company anticipates that the utilization of the available Federal net operating tax loss carryforwards to offset future Federal taxable income will result in the Company not having to use its cash resources to pay Federal income taxes through 2006.

At September 30, 2004, the Condensed Consolidated Balance Sheet contains a net deferred tax asset of $20.2 million, net of a valuation allowance of $8.9 million. Substantially all of the net deferred tax asset relates to Federal net operating tax loss carryforwards. The valuation allowance has been established primarily to reflect the estimate of Federal net operating tax loss carryforwards that are expected to expire unutilized. The valuation allowance decreased $2.1 million in the third quarter of 2004. In accordance with SFAS No. 109 Accounting for Income Taxes ("SFAS 109"), $.7 million of this decrease in the valuation allowance in the third quarter of 2004 was recognized as a reduction to goodwill of CPR Prompt and Ginsberg as a result of the increased projected Federal taxable income provided by these acquisitions. The remaining $1.4 million decrease in the valuation allowance in the third quarter of 2004 was primarily related to the following: (i) $1.6 million decrease in the valuation allowance due to other increased estimates of projected Federal taxable income; and (ii) $.2 million increase in the valuation allowance related to the inability to realize other deferred tax assets. The Company now believes it is more likely than not that certain of these Federal net operating tax loss carryforwards will be utilized. There was no change in the valuation allowance during the third quarter of 2003.

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Net sales for the nine months ended September 30, 2004 increased 6.6% to $139.0 million from $130.4 million for the comparable period in 2003. The growth in net sales for the first nine months of 2004 is positively impacted by the inclusion of an additional $2.8 million of net sales from the Haan, CPR Prompt and Ginsberg acquisitions, organic growth of approximately 4.6% and the overall stabilization of general national and international economic conditions compared to the volatility in the U.S. economy and budget uncertainty in the U.S. education sector which had affected the Company in the comparable period in 2003. Net sales in the educational segment, totaling $120.1 million, increased 7.9% in the first nine months of 2004 from $111.4 million in the first nine months of 2003. Excluding the net sales from Haan, CPR Prompt and Ginsberg, educational segment net sales increased 5.4% from the first nine months of 2003. The commercial segment recorded net sales of $23.6 million in the first nine months of 2004 as compared to $22.5 million in the first nine months of 2003, increasing 5.2% versus the prior year.

Gross profit for the nine months ended September 30, 2004 increased 6.9% to $52.2 million as compared to $48.8 million for the comparable period in 2003. The increase in gross profit for the first nine months of 2004 is primarily attributable to the 6.6% increase in net sales and the additional contribution to gross profit of $1.2 million made by Haan, CPR Prompt and Ginsberg. Gross profit margin of 37.5% in the first nine months of 2004 remained consistent with the gross profit margin in the first nine months of 2003. The educational segment yielded a gross profit of $46.7 million in the first nine months of 2004, improving on the first nine months of 2003 gross profit of $43.5 million. The educational segment gross profit margin of 38.9% in the first nine months of 2004 remained consistent with the comparable period in 2003. The commercial segment gross profit for the first nine months of 2004 increased 6.5% to $8.7 million from $8.1 million for the comparable period in 2003. The commercial segment gross profit margin in the first nine months of 2004 increased to 36.7% from 36.2% in the comparable period in 2003.

Selling and administrative expenses of $31.2 million for the nine months ended September 30, 2004 increased 2.4% from the comparable period in 2003 while net sales increased 6.6%. As a percent of net sales, selling and administrative expenses decreased to 22.4% in the first nine months of 2004 from 23.3% in the first nine months of 2003. Expenses included in this total include advertising and catalog costs, warehouse and shipping activities, customer service and general administrative functions. Selling and administrative expenses for the first nine months of 2004 were impacted by the following: (i) inclusion of an additional $.3 million in expenses of Haan, CPR Prompt and Ginsberg in operations for the first nine months of 2004; (ii) increase in salaries and wages of $1.2 million as a result of annual employee compensation increases and employee performance incentives; and (iii) an increase in group health costs by 2.9% to $2.5 million in the first nine months of 2004.

The Company recorded $.4 million in compensation expense for the first nine months of 2004 and 2003 related to grants of stock options to certain employees and directors.

The Company incurred expenses of $.6 million to Geneve for certain administrative services for the first nine months of 2004 and 2003.

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Aristotle and its qualifying domestic subsidiaries are included in the Federal income tax return and certain state income tax returns of Geneve. The provision for income taxes for the Company is determined on a separate return basis in accordance with the terms of a tax sharing agreement with Geneve, and payments for current Federal and certain state income taxes are made to Geneve.

The income tax provision for the nine months ended September 30, 2004 was $5.7 million compared to $6.8 million for the comparable period in 2003. These tax provisions reflect effective tax rates of 28.4% and 39.4% for the first nine months of 2004 and 2003, respectively. For the first nine months of 2004, the difference between the Federal statutory income tax rate of 35% and the effective income tax rate results principally from reductions in the valuation allowance amounting to $1.4 million primarily related to increased estimates of projected taxable income, increases to other net deferred tax assets amounting to $.8 million, foreign income taxes and state income taxes. For the first nine months of 2003, the difference between the Federal statutory income tax rate of 35% and the effective income tax rate results principally from foreign and state income taxes. Approximately $5.9 million of the income tax provision for the first nine months of 2004 r elates to the current utilization of the Company's Federal net operating tax loss carryforwards compared to approximately $5.0 million in the first nine months of 2003. Although the reported earnings for the first nine months of 2004 and 2003 are shown after-tax, approximately $5.9 million and $5.0 million, respectively, of cash from operations was retained in the Company primarily as a result of the current utilization of these Federal net operating tax loss carryforwards. Except for Federal alternative minimum tax obligations arising from limitations on the utilization of Federal net operating tax loss carryforwards in 2004 and future years, the Company anticipates that the utilization of the available Federal net operating tax loss carryforwards to offset future Federal taxable income will result in the Company not having to use its cash resources to pay Federal income taxes through 2006.

At September 30, 2004, the Condensed Consolidated Balance Sheet contains a net deferred tax asset of $20.2 million, net of a valuation allowance of $8.9 million. Substantially all of the net deferred tax asset relates to Federal net operating tax loss carryforwards. The valuation allowance has been established primarily to reflect the estimate of Federal net operating tax loss carryforwards that are expected to expire unutilized. The valuation allowance decreased $2.1 million in the first nine months of 2004. In accordance with SFAS 109, $.7 million of this decrease in the valuation allowance in the first nine months of 2004 was recognized as a reduction to goodwill of CPR Prompt and Ginsberg as a result of the increased projected Federal taxable income provided by these acquisitions. The remaining $1.4 million decrease in the valuation allowance in the first nine months of 2004 was primarily related to the following: (i) $1.6 million decrease in the valuation allowance due to other increased estimates of projected Federal taxable income; and (ii) $.2 million increase in the valuation allowance related to the inability to realize other deferred tax assets. The Company now believes it is more likely than not that certain of these Federal net operating tax loss carryforwards will be utilized. There was no change in the valuation allowance during the first nine months of 2003.

At September 30, 2004, the Company had working capital of $59.2 million, increasing from $46.8 million at December 31, 2003. At September 30, 2003, the Company had working capital of $56.7 million. Cash and cash equivalents decreased $1.4 million in the first nine months of 2004, ending the period at $4.2 million. Cash and cash equivalents decreased $4.2 million in first nine months of 2003, ending the period at $7.1 million. This decrease in the use of cash and cash equivalents during the first nine months of 2004 as compared to the same period in 2003 is primarily due to the following activities:

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On October 15, 2003, the Company entered into a five-year, non-amortizing, $45.0 million Revolving Credit Facility. Proceeds from the Revolving Credit Facility were initially used to extinguish the $31.2 million in borrowings outstanding under the then-existing credit facility and $2.2 million in notes payable of the Company. The Revolving Credit Facility will provide the Company with seasonal working capital, letters of credit and funds for appropriate acquisitions of businesses similar in nature to the Company's current business segments. This debt carries a variable rate of interest that is based on Prime or LIBOR rates plus applicable margins. At September 30, 2004, the weighted average interest rate on this debt was 3.2%. The Revolving Credit Facility currently has a committed weighted average rate of interest (including applicable margins) of approximately 3.1%. Such rate commitments expire on various dates through November 26, 2004. The Company's Revolving Credit Facility is collateralized by certain accounts receivable, inventories and property, plant and equipment, and shares of a certain subsidiary's capital stock outstanding and ownership interests of certain of the Company's limited liability subsidiaries. The Revolving Credit Facility contains various financial and operating covenants, including, among other things, requirements to maintain certain financial ratios and restrictions on additional indebtedness, common stock dividend payments, capital disposals and intercompany management fee s. The Company was in compliance with all financial covenants as of September 30, 2004.

Capital resources in the future are expected to be used for the development of catalogs and product lines, to acquire additional businesses and for other investing activities. The Company anticipates that there will be sufficient financial resources to meet projected working capital and other cash requirements for at least the next twelve months. Management of the Company believes it has sufficient capacity to maintain current operations and support a substantial amount of future growth.

The Company believes the following accounting policies affect the more significant judgments and estimates used in the preparation of the Condensed Consolidated Financial Statements:

Prepaid Catalog Costs and Amortization - The Company accumulates all direct costs, less vendor rebates, incurred in the development, production and circulation of catalogs on the Condensed Consolidated Balance Sheets until the related catalog is mailed, at which time such catalog costs are amortized into selling and administrative expense over the estimated sales realization cycle of one year, using the straight-line method.

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Deferred Income Taxes - At September 30, 2004, the Condensed Consolidated Balance Sheet contains a net deferred tax asset of approximately $20.2 million, net of a valuation allowance of approximately $8.9 million, related primarily to Federal net operating tax loss carryforwards. The realizability of this asset is dependent upon the Company's generation of approximately $60 million in future taxable income and the ability to retain its Federal net operating tax loss carryforward position. Events may limit the use of all or a portion of these Federal net operating tax loss carryforwards, thus potentially resulting in a higher tax liability for the Company in the future. The net deferred tax asset, including the valuation allowance, at September 30, 2004 is subject to future adjustment based upon changes in management's evaluation of the realizability of the deferred tax asset.

Goodwill - The Company evaluates goodwill for impairment at least annually or more frequently if events or circumstances indicate that the assets may be impaired, by applying a fair value based test and, if impairment occurs, the amount of impaired goodwill is written off immediately. The Company evaluates goodwill for impairment based on the expected future cash flows or earnings projections. Goodwill is deemed impaired if the estimated discounted cash flows or earnings projections do not substantiate the carrying value. The estimation of such amounts requires significant management judgment with respect to revenue and expense growth rates, changes in working capital and selection of an appropriate discount rate, as applicable. The use of different assumptions would increase or decrease discounted future operating cash flows or earnings projections and could, therefore, change impairment determination. The Company has evaluated its goodwill at December 31, 2003, and determined th at there has been no impairment of goodwill.

Defined Benefit Plans - The Company accounts for the benefits under its salaried and hourly defined benefit pension plans using actuarial models required by SFAS No. 87, "Employers' Accounting for Pensions." These models use an attribution approach that generally spreads individual events over the service lives of the employees in the plans. Examples of "events" are plan amendments and changes in actuarial assumptions such as discount rate, expected return on plan assets and rate of compensation increases. The principle underlying the required attribution approach is that employees render service over their service lives on a relatively consistent basis and, therefore, the statement of earnings effects of pension benefits are earned in, and should be expensed in, the same pattern.

In calculating net periodic benefit cost and the related benefit obligation, the Company is required to select certain actuarial assumptions. These assumptions include discount rate, expected return on plan assets and rate of compensation increase. The discount rate assumptions reflect the prevailing market rates for long-term, high-quality, fixed-income debt instruments that, if the obligation was settled at the measurement date, would provide the necessary future cash flows to pay the benefit obligation when due. The Company uses long-term historical actual return experience with consideration of the expected investment mix of the plans' assets, as well as future estimates of long-term investment returns, to develop its assumptions of the expected return on plan assets. The rate of compensation increase is based on historical experience and the Company's long-term plans for such increases.

Revenues - Customarily applying FOB-shipping point terms, the Company recognizes revenue upon shipment of products to its customer, which corresponds to the time when risk of ownership transfers. The point of shipment is typically from one of the Company's distribution centers or, on occasion, a vendor's location as a drop shipment. All drop shipment sales are recorded at gross selling price.

As described below, credit risk and interest rate risk are the primary sources of market risk in the Company's accounts receivable and long-term borrowings, respectively.

Credit Risk: The Company provides credit in the normal course of business to its customers, which are primarily educational institutions or distributors. No single customer accounted for more than 10% of sales in the first nine months of 2004 and 2003. The Company performs ongoing credit evaluations of its customers, maintains allowances for potential credit losses and generally does not require collateral to support its accounts receivable balances.

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Interest Rate Risk: Changes in interest rates can potentially impact the Company's profitability and its ability to realize assets and satisfy liabilities. Interest rate risk is resident primarily in long-term borrowings, which typically have variable interest rates based on Prime or LIBOR rates. Assuming no other change in financial structure, an increase of 1% in the Company's variable interest rate for long-term borrowings would decrease earnings before income taxes for 2004 by approximately $.3 million. This amount is determined by considering a 1% increase in interest rates on the average long-term borrowings estimated to be outstanding in 2004.

The Company's long-term borrowings as of September 30, 2004 are as follows (in millions, except percentage data):

The fair market value of long-term borrowings equals the face amount of long-term borrowings outstanding because the underlying rate of interest on substantially all of the Company's debt is variable based upon Prime or LIBOR rates.

The President and the Chief Financial Officer of the Company (its principal executive officer and its principal financial officer, respectively) have concluded, based on their evaluation as of the end of the period covered by this Report, that the Company's disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports filed or submitted by it under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's ("SEC") rules and forms, and include controls and procedures designed to ensure that information required to be disclosed by the Company in such reports is accumulated and communicated to the Company's management, including the President and the Chief Financial Officer, as appropriate, and allow timely decisions regarding required disclosure.

There have not been any changes in the Company's internal control over financial reporting during the fiscal quarter ended September 30, 2004 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

The Company believes that this Quarterly Report on Form 10-Q may contain forward-looking statements within the meaning of the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those projected or suggested in such forward-looking statements. The Company cautions investors that there can be no assurance that actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors including, but not limited to, the following: (i) the ability of the Company to obtain financing and additional capital to fund its business strategy on acceptable terms, if at all; (ii) the ability of the Company on a timely basis to find, prudently negotiate and consummate additional acquisitions; (iii) the ability of the Company to manage any to-be acquired businesses; (iv) the ability of the Company to retain and utilize its Federal net operating tax loss carryforward position; and (v) general economic conditions. As a result, the Company's future development efforts involve a high degree of risk. For further information, please see the Company's filings with the SEC, including its Forms 10-K, 10-Q and 8-K.

Reference is also made to the risk factors set forth in the final prospectus which constitutes a portion of the Company's Registration Statement on Form S-4 (Commission File No. 333-86026), which was filed in connection with the merger with Nasco International, Inc.

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See Page 21 for the Exhibit index.

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Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

                                                                                                                                                                                                         Date: November 10, 2004

                                                                                                                                                                         &n bsp;                              /s/ Steven B. Lapin

                                                                                                                                                                                                             (Principal Executive Officer)

                                                                                                                                                                                                             /s/ Dean T. Johnson

                                                                                                                                                                                                             (Principal Financial and Accounting Officer)

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