exv10w3



 





Exhibit 10.3




EXECUTION COPY




EMPLOYMENT AGREEMENT




          THIS AGREEMENT entered into as of the 3rd day of March, 2004, by and between BridgeCom
Holdings, Inc. (the “Company”), and Brian Crotty, an individual (the “Executive”) (hereinafter
collectively referred to as the “parties”).




          WHEREAS, the Company, MCG Capital Corporation, a Delaware corporation, Telecomm North Corp., a
Delaware corporation, and certain stockholders of the Company are parties to an Agreement and Plan
of Merger, dated as of November 26, 2003 (the “Merger Agreement”);




          WHEREAS, the Company is engaged in the business of providing telecommunications, Internet and
related products and services in the States of New York, New Jersey and certain other states;




          WHEREAS, the Executive has heretofore been employed by the Company and/or its subsidiaries
as its Chief Operating Officer and the Company desires to retain the services of the Executive
on the terms set forth herein;




          WHEREAS, to the extent that the Executive and the Company and/or its subsidiaries have
previously entered into an agreement providing for certain severance arrangements and other terms
of employment (the “Prior Employment Agreement”), the Company and the Executive agree that this
Agreement shall replace and supersede the Prior Employment Agreement;




          WHEREAS, in order to induce the Executive to remain in the employ of the Company, the Company
desires by this writing to set forth the continued employment relationship of the Executive with
the Company.




          NOW, THEREFORE, in consideration of the respective agreements of the parties contained
herein, it is agreed as follows:




          1. Term. The initial term of employment under this Agreement shall be for the period
commencing on the Closing Date (as defined in the Merger Agreement), and ending on the first
anniversary thereof; provided, however, that the term of this Agreement shall be
extended for one (1) year at the end of the initial term and on each anniversary thereafter unless
the Company shall have given written notice to the Executive at least sixty (60) days prior thereto
that the term of this Agreement shall not be so extended; and provided, further,
that if the Company does not extend the term of this Agreement following the expiration of the
initial term or any renewal term, the Executive shall be terminated following the expiration of
such initial term or renewal term; and provided, further, that this Agreement shall
not become effective prior to eight (8) days following the execution by the Executive of a general
release of,




 









 







and waiver of claims against,
the Company and its subsidiaries, affiliates, directors,
officers, employees and agents in a form attached hereto as Exhibit A.




          2. Employment. (a) The Executive shall be employed as the President of the Company or
in such other capacity for the Company and its subsidiaries and affiliates as may be mutually
agreed to by the parties, and shall provide such services to the Company and its subsidiaries and
affiliates as the Company may reasonably request. The Executive shall report to the Chief
Executive Officer (the “CEO”) of the Company. The Executive agrees to perform faithfully,
industriously, and to the best of the Executive’s ability, experience, and talents, all of the
duties, responsibilities and exercise the authority customarily performed, undertaken and
exercised by an employee situated in a similar position and to the reasonable satisfaction of the
CEO or the Board of Directors (the “Board”). Subject to the following paragraph, such duties shall
be provided at such places as the needs, business, or opportunities of the Company and its
subsidiaries and affiliates may require from time to time.




          The Executive shall arrange his affairs and lifestyle so that he can perform his duties from
the Company’s offices currently located at 115 Stevens Avenue, Valhalla, New York or at office
facilities at such other locations approved by the CEO within a forty-five (45) mile radius of the
Company’s offices in Valhalla (the “Valhalla 45-Mile Radius”). If the Executive fails to continue
to perform his duties at a location within the Valhalla 45-Mile Radius, this Agreement shall be
deemed terminated for cause by the Company.




               (b) Excluding periods of personal leave days to which the Executive is entitled, the Executive
agrees to devote reasonable attention and time during usual business hours to the business and
affairs of the Company to the extent necessary to discharge the responsibilities assigned to the
Executive hereunder.



          3. Base Salary. The Company agrees to pay or cause to be paid to the Executive during
the initial term of this Agreement and any subsequent renewal terms, a base salary at the rate of
$310,000 per annum or such other greater amount as the Board may from time to time determine
(hereinafter referred to as the “Base Salary”). Such Base Salary shall be payable in accordance
with the Company’s customary practices, applicable to its executives.




          4. Annual Bonus. The Board, in its sole discretion, shall set the target(s) and
cash bonus amount(s) for each fiscal year.




          5. Stock Options. As soon as practicable following the Closing Date, the Executive
will receive a grant of a Non-Qualified Stock Option (the “Stock Option”) to purchase seven
thousand three hundred and thirty eight (7,338) shares of the common




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stock of Holdings under the Holdings 2004 Stock Incentive Plan established by
Holdings after the Closing Date.




          6. Employee Benefits. The Executive shall be entitled to participate in . all employee
benefit plans, practices and programs maintained by the Company and
made available to employees generally. The Executive’s participation in such plans, practices and
programs shall be on the same basis and terms as are applicable to  employees of the
Company generally.




          7. Executive Benefits. The Executive shall be entitled to participate in all
executive benefit or incentive compensation plans now maintained or hereafter established by the
Company for the purpose of providing compensation and/or benefits to executives of the Company.
Unless otherwise provided herein, the Executive’s participation in such plans shall be on the same
basis and terms as other similarly situated executives of the Company. No additional compensation
provided under any of such plans shall be deemed to modify or otherwise affect the terms of this
Agreement or any of the Executive’s entitlements hereunder.




          8. Expenses. The Executive shall be entitled to receive reimbursement of all
reasonably incurred expenses in connection with the performance of his duties hereunder or for
promoting, pursuing or otherwise furthering the business or interests of the Company, provided,
that, such expenses are in accordance with the Company’s policies and procedures.




          9. Personal Leave Days. The Executive shall be entitled to not less than four
(4) weeks of personal leave days per year, at such reasonable times as the Board shall in
its discretion permit.




          10. Termination. The Executive’s employment hereunder may be , terminated under
the following circumstances:




               (a) Disability. The Company may terminate the Executive’s employment after having
established the Executive’s Disability. For purposes of this Agreement, “Disability” means a
physical or mental infirmity which impairs the Executive’s ability to substantially perform his
duties under this Agreement and which continues for a total of at least ninety (90) days
(exclusive of personal leave days) in a one-hundred eighty (180) day period. The Executive shall
be entitled to the compensation and benefits provided for under this Agreement for any period
during the term of this Agreement and prior to the establishment of the Executive’s Disability
during which the Executive is unable to work due to a physical or mental infirmity.



               (b) Cause. The Company may terminate the Executive’s employment for
“Cause.” A termination for Cause shall mean discharge by the



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Company by reason of the following: (1) The Executive’s conviction of, or a plea of nolo
contendere to, any act which constitutes a felony offense under applicable law in connection with
the performance of the Executive’s obligations on behalf of the Company or which affects the
Executive’s ability to perform the Executive’s obligations as an employee of the
Company or under any employment agreement, non-competition agreement, confidentiality agreement
or like agreement or covenant between the Executive and the Company or which materially and
adversely affects the reputation and business activities of the Company; (2) the Executive’s
willful misconduct in connection with the performance of the Executive’s duties and
responsibilities as an employee of the Company; (3) the Executive’s commission of an act of
embezzlement, fraud or dishonesty which results in a loss, damage or injury to the Company; (4)
the Executive’s substantial and continuing gross negligence in the performance of the Executive’s
duties as an employee of the Company; (5) the Executive’s knowing unauthorized use or
unauthorized disclosure of any trade secret or confidential information of the Company which
adversely affects the business of the Company; provided, that any disclosure of any trade secret
or confidential information of the Company to a third party in the ordinary course of business
who signs a confidentiality agreement shall not be deemed a breach of this subsection; (6)
substance or alcohol abuse for which the Executive fails to undertake and maintain treatment
within five (5) days after requested by the Company; (7) the Executive’s continuing material
failure or refusal to perform the Executive’s duties in accordance with the terms of this
Agreement; provided, that discharge pursuant to this subsection shall constitute discharge for
cause only if the Executive has first received written notice from the President of the Company
stating with specificity the nature of such failure or refusal and, if requested by the Executive
within five (5) days thereafter, the Executive is afforded a reasonable opportunity to be heard
before the Board; or (8) the Executive breaches a material provision of this Agreement.




               (c) Notice of Termination. Any purported termination by the Company or by the
Executive shall be communicated by written Notice of Termination to the other. For purposes of
this Agreement, a “Notice of Termination” shall mean a notice which indicates the specific
termination provision in this Agreement relied upon and shall set forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the Executive’s employment
under the provision so indicated. For purposes of this Agreement, no such purported termination of
employment shall be effective without such Notice of Termination.



               (d) Termination Date, Etc. “Termination Date” shall mean in the case of the
Executive’s death, his date of death, or in all other cases, the date specified in the Notice of
Termination subject to the following:



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                    (1) If the Executive’s employment is terminated by the Company for Cause or due to
Disability, the date specified in the Notice of Termination given to the Executive; and



                    (2) If the Executive’s employment is terminated by the Executive, the date specified in the
Notice of Termination shall not be less than fifteen (15) days and more than thirty (30) days
from the date the Notice of Termination is given to the Company.



          11. Compensation Upon Termination. Upon termination of the Executive’s
employment during the term of this Agreement, the Executive shall be entitled to the
following benefits:




               (a) If the Executive’s employment is terminated by the Company for Cause or Disability or by
the Executive, or by reason of the Executive’s death, the Company shall pay the Executive all
amounts earned or accrued hereunder through the Termination Date but not paid as of the
Termination Date, including (i) Base Salary, (ii) reimbursement for any and all monies advanced
or expenses incurred in connection with the Executive’s employment for reasonable and necessary
expenses incurred by the Executive on behalf of the Company for the period ending on the
Termination Date, (iii) vacation pay, (iv) any unpaid bonuses or incentive compensation related
to the prior fiscal year and (v) any previous compensation which the Executive has previously
deferred (including any interest earned or credited thereon) (collectively, “Accrued
Compensation”). The Executive’s entitlement to any other compensation or benefits shall be
determined in accordance with the Company’s employee benefit plans and other applicable programs
and practices then in effect.



               (b) If the Executive’s employment by the Company shall be terminated by the Company other
than for Cause, death or Disability, or if the Company fails to extend the Agreement following
the expiration of the initial term or any subsequent renewal term, then the Executive shall be
entitled to the benefits provided below:



                    (1) the Company shall pay the Executive all Accrued Compensation; and



                    (2) provided that the Executive shall have executed a general release of, and waiver of
claims against, the Company and its subsidiaries, affiliates, directors, officers, employees and
agents in a form attached hereto as Exhibit B and that such release is effective, the Company
shall pay the Executive as severance pay and in lieu of any further salary for periods subsequent
to the Termination Date, an amount in cash equal to 100% of Base Salary.



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            (c) 
The amounts provided for in Sections 11 (a) and 11 (b)( 1) shall be paid within
fifteen (15) business days after the Termination Date and the amounts
provided for in Section 11(b)(2) shall be paid ratably in accordance with the Company’s customary
practices with respect to Base Salary over the twelve (12) month period immediately following the
Termination Date.



     
               (d) 
The Executive shall not be required to mitigate the amount of any payment provided for
in this Agreement by seeking other employment or otherwise and no such payment shall be offset or
reduced by the amount of any compensation or benefits provided to the Executive in any subsequent
employment.



          12. Employee Covenants.




               (a) Confidential Information. (1) The Executive hereby recognizes and acknowledges
that, in and as a result of the provision of services to the Company, he will receive, and
previously has received, confidential and proprietary information of and regarding the Company, its
business activities and the business activities of the Company’s subsidiaries and affiliates.
Accordingly, as a material inducement for the Company to enter into this Agreement and in
consideration of Executive’s retention and the payment to the Executive of the compensation herein,
the Executive hereby agrees to hold in strictest confidence and not to use for his own benefit or
that of any third party or to intentionally or negligently publish or disclose, directly or
indirectly, in a manner which could be harmful to the Company or its subsidiaries and affiliates,
any “Confidential Information.” For purposes of this Agreement, intending that the term shall be
broadly construed to include anything that may be protected as a trade secret under applicable law,
“Confidential Information” shall mean all information, whether communicated in writing,
electronically, orally or otherwise, and all documents and other tangible materials which record
information, relating to the operation, financial status, business, product development, marketing/promotional activities, contractual relationships with customers and
suppliers, relationships with directors, officers and employees, or internal policies and
procedures of the Company, which has been or is from time to time created or learned by, disclosed
to or known by the Executive as a consequence of his service to the Company, whether or not
pursuant to this Agreement.



                    (2) The restrictions on disclosure by the Executive of Confidential Information shall not
apply to (i) information which at the time of disclosure was generally available to the public;
(ii) information which is published or otherwise becomes available to the public through means
other than an act or omission of the Executive; or (iii) information which was previously known to
the Executive free of any obligation to keep it confidential. Notwithstanding anything to the
contrary herein, Executive may disclose Confidential Information (i) if required to do so by law,
or (ii) if ordered to do so by a court or other governmental authority of competent



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jurisdiction; provided, however,
that the Executive shall, unless prohibited from so doing, provide
the Company prior written notice of any such mandated disclosure and afford the Company an
opportunity to-contest the disclosure and to itself limit the extent of the disclosure to the
maximum extent practicable.




                    (3) Confidential Information disclosed to the Executive is and shall remain the property of
the Company. By disclosing Confidential Information to the Executive, the Company does not
relinquish any of its proprietary rights and interests therein and hereby specifically reserve all
such proprietary rights and interests to said Confidential Information. The Executive shall return,
or, at the sole discretion of the Company, destroy, all Confidential Information and all copies
thereof, including, without limitation, written and electronic copies, as well as all summaries,
notes, memoranda, plans, records, reports, computer tapes, printouts and software or other
documents, materials or things containing Confidential Information, to the Company upon the
termination of this Agreement or promptly upon the written request of the Company for any reason
and at any other time.



               (b) Inventions and Patents. The Executive acknowledges that all inventions,
innovations, improvements, developments, methods, designs, analyses, drawings, reports and all
similar or related information (whether patentable or not) which relate to the actual or
anticipated business, research and development or existing or future products or services of the
Company and its subsidiaries and affiliates and which are conceived, developed or made by him
solely or jointly with others during the term of the Agreement (“Work Product”) belong to the
Company. The Executive shall promptly disclose such Work Product to the Board and perform all
actions reasonably requested by the Board (whether during or after the term of the Agreement) to
establish and confirm such ownership (including, without limitation, assignments, powers of
attorney and other instruments) without additional compensation to the Executive.



               (c) Non-Competition. In consideration of the compensation to be paid to the Executive
hereunder, the Executive agrees that:




                    (i) during the period beginning on the Closing Date and ending twelve (12) months
following the Termination Date (the “Non-Competition Period”), he shall not, whether
individually or in his capacity as a director, officer, manager, member, partner,
shareholder, employee, consultant, agent or representative of or to a person or
entity engage directly or indirectly in any business engaged in the provision of the
telecommunications services or other services provided by the Company or any of their
subsidiaries and downstream affiliates as of the Closing Date or at any time during
the term of the Agreement in any state in which the Company or any of its subsidiaries
and downstream affiliates provided such services to the extent such services in each
such state accounted for greater



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than one percent (1%) of the Company’s revenues; provided, however, that ownership of
less than one percent (1%) of the outstanding stock of any publicly-traded
corporation shall not be deemed to violate this subsection; and




                    (ii) during the period starting on the Closing Date and ending on the second
anniversary of the Termination Date, the Executive shall not
(A) whether individually or in his capacity as a director, officer, manager, member,
partner, shareholder, employee, consultant, agent or representative of or to a person
or entity, solicit or otherwise endeavor to entice away, any person or entity who,
during the term of the Agreement and at any time during the six (6) months prior to
the termination of the Executive’s services hereunder, is or was an officer,
employee, sales agent, consultant, customer or supplier of the Company or its
subsidiaries and affiliates, or
(B) either directly or indirectly, alone or in conjunction with another party,
interfere with or harm, or attempt to interfere with or harm, the relationship of the
Company or its subsidiaries and affiliates (including the termination of such
relationship or causing the purchase of services from a competitor) with any person
or entity who, during the term of the Agreement, and at any time during the six (6)
months prior to the termination of the Executive’s services hereunder, is or was a
current or prospective employee, sales agent, consultant, customer or supplier of the
Company or its subsidiaries and affiliates or otherwise had a business relationship
with the Company or its subsidiaries and affiliates other than the Executive’s
secretary/administrative assistant.



               (d) Nondisparagement; Cooperation. The Executive shall not, at any time during his
employment with the Company or thereafter, make any public or private statement to the news media,
to any Company competitor or client, or to any other individual or entity, if such statement would
disparage any of the Company, any of their respective businesses or any director or officer of any
of them or such businesses or would have a deleterious effect upon the interests of any of such
businesses or the stockholders or other owners of any of them; provided, however,
that the Executive shall not be in breach of this restriction if such statements consist solely of
private statements made to any officers, directors or employees of the Company by the Executive in
the course of carrying out his duties pursuant to this Agreement or, to the extent applicable, his
duties as a director or officer; and provided further that nothing contained in this Section 12(d)
or in any other provision of this Agreement shall preclude the Executive from making any statement
in good faith that is required by law, regulation or order of any court or regulatory commission,
department or agency.



               (e) The parties hereto agree that the Company would suffer irreparable harm from a breach by
the Executive of any of the covenants or agreements



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contained herein and that money damages would not be an adequate remedy for any such breach. In
the event of a breach or threatened breach by the Executive of any of the provisions of this
Section 12, the Company or its successors or assigns, in addition to all other rights and remedies
existing in its favor, shall be entitled to specific performance and/or injunctive or other
equitable relief from any court of competent jurisdiction in order to enforce or prevent any
violations of the provisions hereof without posting any bond or other security.




               (f) The Executive recognizes, acknowledges and agrees that the terms and conditions of this
Section 12 are reasonable and properly required for the
adequate protection of the Company’s business, and do not preclude the Executive from
pursuing the Executive’s livelihood.



               (g) If, at the time of enforcement of any of the provisions of this Section 12, a court holds
that the restrictions stated therein are unreasonable under the circumstances then existing, the
parties hereto agree that the maximum period, scope or geographical area reasonable under such
circumstances shall be substituted for the stated period, scope or area.



               (h) The Executive agrees that the covenants made in Section 12 shall each be construed as an
agreement independent of any other provision of this Agreement and each shall survive any order of
a court of competent jurisdiction terminating any other provision of this Agreement.



          13. Entire Agreement. No agreement or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either party which are not
expressly set forth in this Agreement. This Agreement contains the complete agreement between the
parties hereto and supersedes any prior understandings, agreements or representations by or
between the parties, written or oral,
which may have related to the subject matter hereof in any way. The parties agree that
neither the Company nor the Executive has any further obligations under the Prior Employment
Agreement and that the Executive shall not be entitled to any further benefits under the Prior
Employment Agreement. The Executive agrees to release the Company from any claims the
Executive may have regarding compensation or benefits arising out of the Prior Employment
Agreement.




          14. Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the Company and their affiliates, successors and assigns and shall be binding upon and
inure to the benefit of the Executive and his legal representatives and assigns; provided that in
no event shall the Executive’s obligations to perform future services for the Company be delegated
or transferred by the Executive without the prior written consent of the Company (which consent
may be withheld in their sole discretion). It is not the intent of the parties that there be any
third party beneficiaries of





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this Agreement, except as expressly provided in this Agreement. The Company may assign or
transfer their rights hereunder to any of their affiliates or to a successor corporation in the
event of merger, consolidation or transfer or sale of all or substantially all of the assets of the
Company.




          15. Amendment and Waiver. Any provision of this Agreement may be amended, waived or
terminated only in writing and signed by the Company and the Executive. No waiver of any provision
hereunder or any breach or default thereof shall extend to or affect in any way any other
provision or prior or subsequent breach or default. No course of dealing between the parties shall
be deemed to affect or to
modify, amend or discharge any provision or term of this Agreement. No delay on the part of
the Company or the Executive in the exercise of any of their respective rights or remedies
shall operate as a waiver thereof, and no single or partial exercise by the Company or the
Executive of any such right or remedy shall preclude other or further exercises thereof. A
waiver of right or remedy on any one occasion, or with regard to one provision, shall not be
construed as a bar to, or waiver of, any such right or remedy on any other occasion or with
regard to any other provision.




          16. Governing Law. All matters relating to the interpretation, construction, validity
and enforcement of this Agreement shall be governed by and construed in accordance with the
domestic laws of the State of New York without giving effect to any choice or conflict of law
provision or rule (whether of the State of New York or any other jurisdiction) that would cause
the application of laws of any jurisdiction other than the State of New York.




          17. Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law, such provision
shall be ineffective only to the extent of such prohibition or invalidity, without invalidating
the remainder of such provision or the remaining provisions of this Agreement; provided, that if a
court having competent jurisdiction shall find that the covenant contained in Sections 12 hereof
is not reasonable, such court shall have the power to reduce the duration and/or geographic area
and/or scope of such covenant, and the covenant shall be enforceable in this reduced form.




          18. Jury Trial. Each of the parties hereto herby irrevocably waives all rights to
trial by jury in any action, proceeding or counterclaim arising out of or relating to this
Agreement.




          19. No Strict Construction. The language used in this Agreement shall be deemed to be
the language chosen by the parties hereto to express their mutual intent, and no rule of strict
construction shall be applied against any party.


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           20. Notice. All notices, demands and other communications to be given or delivered
under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to
have been given (a) when delivered by hand (with written confirmation of receipt), (b) three (3)
days after sent by e-mail (with such communication to be in PDF format), with electronic
confirmation of sending, provided that a copy is sent on the same day by registered mail, return
receipt requested, in each case to the appropriate mailing and e-mail addresses set forth below (or
to such other mailing and e-mail addresses as either party may designate by notice to the other
party in accordance with this provision), or (c) when actually delivered if sent by any other
method that results in delivery (with written confirmation of receipt):



Notices to Holdings:


BridgeCom Holdings, Inc.

115 Stevens Avenue

3rd Floor

Valhalla, New York 10595

Attention: Charles Hunter

Phone: (914) 468-8214

Facsimile: (914) 742-5818

Email: notices@bridgecom.com



with copies to:




MCG Capital Corporation

1100 Wilson Boulevard, Suite 3000

Arlington, Virginia 22209

Attention: President, Investment Administration and General Counsel

Phone: (703) 247-7500

Facsimile: (703) 247-7545

Email: srubenstein@mcgcapital.com



Notices to Executive:


Brian Crotty
 15 Laura Drive

Danbury, Connecticut 06811

Phone: 914-629-6052

Facsimile: 203-778-3808

Email: brian@crotty.tv






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          21. Captions. The headings and captions used in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of this Agreement. The
use of the word “including” herein means “including without limitation.”




          22. Counterparts. This Agreement may be executed in multiple counterparts, any one of
which need not contain the signatures of more than one party, but all such counterparts taken
together shall constitute one and the same instrument.






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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above
written.




	 	 	 	 	 	 
	 	COMPANY:



BRIDGECOM HOLDINGS, INC.

 	 
	 	By:  	/s/ Dana Stern
 	 
	 	 	Name:  	Dana Stern 	 
	 	 	Its:       Vice President 	 
	 
	 	THE EXECUTIVE

 	 
	 	By:  	/s/ Brian Crotty
 	 
	 	 	Brian Crotty 	 
	 




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