Employment Agreement - Greg Manning Auctions Inc. and Larry Crawford
EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") is effective as of April 23,
2001, and is between GREG MANNING AUCTIONS, INC, a Delaware corporation
("GMAI"), and LARRY CRAWFORD, an individual ("Mr. Crawford").
GMAI wishes to employ Mr. Crawford on the terms and conditions set forth
in this Agreement, and Mr. Crawford wishes to be so employed.
GMAI and Mr. Crawford therefore agree as follows:
1. Employment; Term. GMAI hereby employs Mr. Crawford, and Mr. Crawford
hereby accepts employment with GMAI, in accordance with and subject to the terms
and conditions set forth in this Agreement. The term of this Agreement (the
"Term") commences on April 23, 2001 and, unless earlier terminated in accordance
with Section 6, will terminate on April 23, 2003. Prior to the end of the Term
GMAI and Mr. Crawford may by written agreement signed by them extend the Term
for one or more additional one-year periods.
2. Duties. (a) During the Term, Mr. Crawford shall serve as Chief
Financial Officer of GMAI and shall report to the Chief Executive Officer, or a
person designated by the CEO. Mr. Crawford will have such duties and
responsibilities as are customary for Mr. Crawford' position and any other
duties or responsibilities he may be reasonably assigned by the Chief Executive
Officer.
(b) During the period Mr. Crawford is employed by GMAI, Mr. Crawford
shall devote his full business time and best efforts to the business and affairs
of GMAI. Mr. Crawford understands and acknowledges that Mr. Crawford' duties
will require business travel from time to time.
3. Compensation. (a) GMAI shall pay Mr. Crawford a salary of $150,000 per
annum (that salary, the "Base Salary"). Payment of the Base Salary will be in
accordance with GMAI's standard payroll practices and subject to all legally
required or customary withholdings.
(b) In the event that in any full fiscal quarter during Mr. Crawford's
employment hereunder the Company's Quarterly Pre-Tax Income (as defined below)
equals or exceeds $50,000, GMAI shall pay to Mr. Crawford a cash bonus equal to
$12,500 (that bonus, a "Bonus"). Such amount shall be payable within 30 days
following the end of the related quarter. "Quarterly Pre-Tax Income" means the
net income of GMAI for the quarter before federal and state income taxes and
bonuses paid under this section, determined in accordance with generally
accepted accounting principles for interim financial statements, and subject to
adjustment at the end of each fiscal year in accordance with generally accepted
accounting principles.
4. Stock Options. Concurrently with effectiveness of this Agreement, GMAI
shall, pursuant to a Stock Option Agreement between GMAI and Mr. Crawford in the
form of
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Exhibit A, grant to Mr. Crawford options to purchase 40,000 shares of common
stock of GMAI. In addition, Mr. Crawford shall be entitled to receive options to
purchase 40,000 shares of GMAI-ASIA.com, Inc, at such time and upon such terms
as the employees of that company are granted similar options.
5. Benefits. (a) GMAI shall pay to Mr. Crawford, in four equal quarterly
installments of $2,500 each and otherwise consistent with GMAI's standard
payroll practices (and subject to all legally required or customary
withholdings), an annual non-accountable expense allowance equal to $10,000 per
year during the Term.
(b) Mr. Crawford is entitled to participate in any and all medical
insurance, group health, disability insurance and other benefit plans that are
made generally available by GMAI to employees of GMAI, provided that the
medical, group health and disability insurance benefits provided by GMAI to Mr.
Crawford shall be substantially as favorable to Mr. Crawford or more favorable
to Mr. Crawford as those generally provided by GMAI to its senior executives.
GMAI shall pay all premiums and deductibles payable in connection with medical
insurance, in accordance with policies set forth in GMAI's Employee Manual.
Additionally, Mr. Crawford is initially entitled to receive three weeks paid
vacation per year, which will increase incrementally in accordance with the
schedule set forth in the Employee Manual, and paid holidays made available
pursuant to GMAI's policy to all employees of GMAI. GMAI, in its sole
discretion, may at any time amend or terminate any such benefit plans or
programs.
6. Termination. Mr. Crawford' employment hereunder may be terminated prior
to the end of the Term under the following circumstances:
(a) Mr. Crawford' employment hereunder will terminate upon Mr.
Crawford' death.
(b) Except as otherwise required by law, GMAI may terminate Mr.
Crawford' employment hereunder at any time after Mr. Crawford becomes Totally
Disabled. For purposes of this Agreement, Mr. Crawford will be "Totally
Disabled" as of the earlier of (1) the date Mr. Crawford becomes entitled to
receive disability benefits under GMAI's long-term disability plan and (2) Mr.
Crawford' inability to perform the duties and responsibilities contemplated
under this Agreement for a period of more than 120 consecutive days due to
physical or mental incapacity or impairment.
(c) GMAI may terminate Mr. Crawford' employment hereunder for Cause at
any time after providing written notice to Mr. Crawford. For purposes of this
Agreement, "Cause" means any of the following:
(1) Mr. Crawford' neglect or failure or refusal to perform his duties under
this Agreement (other than as a result of total or partial incapacity due
to physical or mental illness);
(2) any act by or omission of Mr. Crawford constituting gross negligence or
willful misconduct in connection with the performance of his duties that
could reasonably be expected to materially injure the reputation, business,
or business relationship of GMAI or any of its affiliates;
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(3) Mr. Crawford' conviction (including conviction on a nolo contendere plea)
of a felony or any crime involving, in the good faith judgment of GMAI,
fraud, dishonesty or moral turpitude;
(4) the breach of an obligation set forth in Section 8, 9 or 10; or
(5) any other material breach of this Agreement.
(d) GMAI may terminate Mr. Crawford' employment hereunder for any
reason, upon 30 days' prior written notice.
(e) Mr. Crawford may terminate his employment hereunder for Good Reason
at any time after providing written notice to GMAI. For the purposes of this
Agreement, "Good Reason" means any of the following:
(1) GMAI decreases or fails to pay Mr. Crawford' Base Salary or Bonus provided
in Section 3 or the benefits described in Section 5 above;
(2) Mr. Crawford no longer holds the office of Chief Financial Officer or an
office of equivalent stature, or his functions and/or duties are materially
diminished; or
(3) Mr. Crawford' job site is relocated to a location which is more than thirty
(30) miles from the current location, unless the parties mutually agree to
relocate more than thirty (30) miles from the current location.
A termination by Mr. Crawford with Good Reason shall be effective only if,
within 30 days following delivery of a written notice by Mr. Crawford to GMAI
that Mr. Crawford is terminating his employment with Good Reason, GMAI has
failed to cure the circumstances giving rise to Good Reason.
7. Compensation Following Termination Prior to the End of the Term. In the
event that Mr. Crawford' employment hereunder is terminated prior to the end of
the Term, Mr. Crawford will be entitled only to the following compensation and
benefits upon such termination:
(a) In the event that Mr. Crawford' employment hereunder is terminated
prior to the expiration of the Term by reason of Mr. Crawford' death or Total
Disability, pursuant to Section 6(a) or 6(b), GMAI shall pay the following
amounts to Mr. Crawford (or Mr. Crawford' estate, as the case may be):
(1) any accrued but unpaid Base Salary and Bonus (as determined pursuant to
Section 3) for services rendered to the date of termination;
(2) any accrued but unpaid amounts required to be paid pursuant to Section 5(a)
or 5(b); and
(3) any vacation accrued and unused to the date of termination.
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(b) In the event that Mr. Crawford' employment hereunder is terminated
prior to the expiration of the Term by GMAI for cause, pursuant to Section 6(c),
GMAI shall pay the following amounts to Mr. Crawford:
(1) any accrued but unpaid Base Salary (as determined pursuant to Section 3)
for services rendered to the date of termination;
(2) any accrued but unpaid amounts required to be paid pursuant to Section 5(a)
or 5(b); and
(3) any vacation accrued and unused to the date of termination.
(c) In the event that Mr. Crawford' employment hereunder is terminated
by GMAI without Cause pursuant to Section 6(d), or by Mr. Crawford with Good
Reason pursuant to Section 6(e), GMAI shall pay the following amounts to Mr.
Crawford:
(1) any accrued but unpaid Base Salary (as determined pursuant to Section 3)
for services rendered to the date of termination;
(2) any accrued but unpaid amounts required to be paid pursuant to Section 5(a)
or 5(b);
(3) any vacation accrued and unused to the date of termination; and
(4) payment of an amount equal to $50,000, payable in one lump-sum payment
within 30 days following termination.
(d) The benefits to which Mr. Crawford may be entitled upon termination
pursuant to the plans, policies and arrangements referred to in Section 5(b)
will be determined and paid in accordance with the terms of those plans,
policies and arrangements.
(e) Except as may be provided under this Agreement, under the terms of
any incentive compensation, employee benefit, or fringe benefit plan applicable
to Mr. Crawford at the time of termination of Mr. Crawford' employment prior to
the end of the Term, Mr. Crawford will not be entitled to receive any other
compensation, or to participate in any other plan, arrangement or benefit, with
respect to any future period after his termination or resignation.
8. Proprietary Information. (a) Mr. Crawford acknowledges that during the
course of his employment with GMAI he will necessarily have access to and make
use of proprietary information and confidential records of GMAI. Mr. Crawford
shall not during the Term or at any time thereafter directly or indirectly use
for his own purpose or for the benefit of any person or entity other than GMAI
or GMAI nor otherwise disclose, any proprietary information to any person or
entity, unless that disclosure has been authorized in writing by GMAI or GMAI or
is otherwise required by law.
(b) Mr. Crawford understands that subject to Section 8(c), the term
"proprietary information" includes, but is not limited to, the following:
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(1) the name and address of any customer, vendor or affiliate of GMAI or GMAI
or any information concerning the transactions or relations of any such
customer, vendor or affiliate with GMAI or GMAI or any of GMAI's or GMAI's
partners, principals, directors, officers or agents;
(2) any information concerning any product, technology, or procedure employed
by GMAI or GMAI but not generally known to their customers, vendors or
competitors, or under development by or being tested by GMAI or GMAI but
not at the time offered generally to customers or vendors;
(3) any information relating to GMAI's or GMAI's computer software, computer
systems, pricing or marketing methods, sales margins, cost of goods, cost
of material, capital structure, operating results, borrowing arrangements
or business plans;
(4) any information which is generally regarded as confidential or proprietary
in any line of business engaged in by GMAI or GMAI;
(5) any business plans, budgets, advertising or marketing plans of GMAI of
GMAI;
(6) any information contained in any of GMAI's or GMAI's written or oral
policies and procedures or manuals;
(7) any information belonging to customers, vendors or affiliates of GMAI or
GMAI or any other person or entity which GMAI or GMAI has agreed to hold in
confidence;
(8) any inventions, innovations or improvements covered by this Agreement;
(9) salary, staffing and employment information of GMAI or GMAI; and
(10) all materials relating to or embodying any of the foregoing, whether in a
handwritten, printed, graphic, video, audio, electronic or other medium.
(c) Mr. Crawford acknowledges that information that is not novel or
copyrighted or patented may nonetheless be proprietary information.
(d) The term "proprietary information" does not include information
known by Mr. Crawford prior to his employment by GMAI or information generally
available to and known by the public or information that is or becomes available
to Mr. Crawford on a non-confidential basis from a source other than GMAI or
GMAI or their respective directors, officers, employees, partners, principals or
agents (other than as a result of a breach of any obligation of
confidentiality).
9. Surrender of Records. All proprietary information is and will remain
the sole property of GMAI or (GMAI as the case may be) during the Term and
thereafter. Following termination of his employment hereunder for any reason Mr.
Crawford may not retain any proprietary information, and shall promptly return
to GMAI (or GMAI as the case may be) any proprietary information in his
possession.
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10. Intellectual Property. All inventions, innovations or improvements
(including policies, procedures, products, improvements, software, ideas and
discoveries, whether patent, copyright, trademark, service mark, or otherwise)
conceived or made by Mr. Crawford, either alone or jointly with others, in the
course of his employment by GMAI, and any derivatives of any such inventions,
innovations, or improvements, belong to GMAI. Mr. Crawford shall promptly
disclose to GMAI in writing all such inventions, innovations or improvements and
perform all actions reasonably requested by GMAI to establish and confirm
ownership by GMAI, including, but not limited to, cooperating with and assisting
GMAI in obtaining patents, copyrights, trademarks, or service marks for GMAI in
the United States and in foreign countries. Mr. Crawford agrees that any
application filed by Mr. Crawford within one year after the termination of his
employment hereunder will be presumed to constitute an invention that was made
during his employment unless he can provide evidence satisfactory to GMAI to the
contrary.
11. Confidentiality. Mr. Crawford shall keep confidential the terms of
this Agreement. This provision does not prohibit Mr. Crawford from providing
this information to his attorneys or accountants for purposes of obtaining legal
or tax advice or as otherwise required by law. GMAI shall not disclose the terms
of this Agreement except as necessary in the ordinary course of its business or
as required by law.
12. Enforcement. Mr. Crawford acknowledges that, by virtue of his
position, his services and access to and use of confidential records and
proprietary information, any violation by him of any of the undertakings
contained in Sections 8 through 11 would cause GMAI immediate, substantial and
irreparable injury for which it has no adequate remedy at law. Accordingly, Mr.
Crawford consents to GMAI seeking entry of an injunction or other equitable
relief from a court of competent jurisdiction restraining any violation or
threatened violation of any undertaking contained in Sections 8 through 11. Mr.
Crawford waives posting by GMAI of any bond otherwise necessary to secure any
such injunction or other equitable relief. Rights and remedies provided for in
this Section 12 are cumulative and shall be in addition to rights and remedies
otherwise available to the parties hereunder or under any other agreement or
applicable law.
13. Notices. (a) Every notice or other communication required or
contemplated by this Agreement must be in writing and sent by one of the
following methods: (1) personal delivery, in which case delivery is deemed to
occur the day of delivery; (2) certified or registered mail, postage prepaid,
return receipt requested, in which case delivery is deemed to occur the day it
is officially recorded by the U.S. Postal Service as delivered to the intended
recipient; or (3) next-day delivery to a U.S. address by recognized overnight
delivery service such as Federal Express, in which case delivery is deemed to
occur one business day after being sent. In each case, a notice or other
communication sent to a party must be directed to the address for that party set
forth below, or to another address designated by that party by written notice:
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If to GMAI, to:
Greg Manning Auctions, Inc.
775 Passaic Avenue
West Caldwell, NJ 07006
Attention: Greg Manning
with a copy to:
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, New York 10022
Attention: Scott S. Rosenblum, Esq.
If to Mr. Crawford, to:
Mr. Larry Crawford
290 Morris Avenue
Mountain Lakes, NJ 07946
14. Assignability; Binding Effect. This Agreement is a personal contract
calling for the provision of unique services by Mr. Crawford, and Mr. Crawford'
rights and obligations hereunder may not be sold, transferred, assigned, pledged
or hypothecated. In the event of any attempted assignment or transfer of rights
hereunder by Mr. Crawford contrary to the provisions of this Agreement (other
than as may be required by law), GMAI will have no further liability for
payments under this Agreement. The rights and obligations of GMAI under this
Agreement bind and run in favor of the successors and assigns of GMAI.
15. Complete Understanding. This Agreement constitutes the complete
understanding between the parties with respect to the employment of Mr. Crawford
by GMAI and supersedes all prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter of this Agreement.
16. Amendments; Waivers. This Agreement may not be amended except by an
instrument in writing signed on behalf of GMAI and Mr. Crawford. No waiver by
any party of any breach under this Agreement will be deemed to extend to any
prior or subsequent breach or affect in any way any rights arising by virtue of
any prior or subsequent such occurrence. Waiver by either party of any breach by
the other party will not operate as a waiver of any other breach, whether
similar to or different from the breach waived. No delay on the part of GMAI or
Mr. Crawford in the exercise of any of their respective rights or remedies will
operate as a waiver of that right.
17. Severability. If any provision of this Agreement or its application to
any person or circumstances is determined by any court of competent jurisdiction
to be unenforceable to any extent, that unenforceable provision will be deemed
eliminated to the extent necessary to permit
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the remaining provisions to be enforced, and the remainder of this Agreement, or
the application of the unenforceable provision to other persons or
circumstances, will not be affected thereby. If any provision of this Agreement,
or any part thereof, is held to be unenforceable because of the scope or
duration of or the area covered by that provision, the court making that
determination shall reduce the scope, duration of or area covered by that
provision or otherwise amend the provision to the minimum extent necessary to
make that provision enforceable to the fullest extent permitted by law.
18. Survivability. The provisions of this Agreement that by their terms
call for performance subsequent to termination of Mr. Crawford' employment
hereunder, or of this Agreement, will survive such termination.
19. Governing Law. This Agreement is governed by the laws of the State of
New York, without giving effect to principles of conflict of laws.
20. Jurisdiction; Service of Process. Any action or proceeding seeking to
enforce any provision of, or based on any right arising out of, this Agreement
must be brought against any of the parties in the courts of the State of New
York, County of New York, or, if it has or can acquire jurisdiction, in the
United States District Court for the Southern District of New York, and each of
the parties consents to the jurisdiction of those courts (and of the appropriate
appellate courts) in any such action or proceeding and waives any objection to
venue laid therein. Process in any such action or proceeding may be served by
sending or delivering a copy of the process to the party to be served at the
address and in the manner provided for the giving of notices in Section 13.
Nothing in this Section 20, however, affects the right of any party to serve
legal process in any other manner permitted by law.
GREG MANNING AUCTIONS, INC.
By: /s/ Greg Manning
Greg Manning
Chairman of the Board, Chief Executive Officer
and President
/s/ Larry Crawford
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LARRY CRAWFORD
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Exhibit A
GREG MANNING AUCTIONS, INC.
1997 STOCK OPTION PLAN, AS AMENDED
STOCK OPTION AGREEMENT
----------------------
STOCK OPTION AGREEMENT (the "Agreement"), dated as of April 23, 2001 between
Greg Manning Auctions, Inc., a New York corporation (the "Company"), and Larry
Crawford, an employee of the Company (the "Optionee"). Capitalized terms used
herein without definition shall have the meanings ascribed thereto in the Plan
(as defined below),
The Board of Directors of the Company has determined that the objectives of the
Company's 1997 Stock Option Plan, as amended (the "Plan") will be furthered by
granting to the Optionee a stock option pursuant to the Plan.
In consideration of the foregoing and of the mutual undertakings set forth in
this Agreement, the Company and the Optionee agree as follows:
SECTION 1. Grant of Option
--------------------------
The Company hereby grants to the Optionee a stock Option (the "Option") to
purchase 40,000 shares of Common Stock at a purchase price of $ ___ per share,
the fair market value of Common Stock on the grant date. It is intended that the
Option shall qualify as an "incentive stock option" as defined in section 422 of
the Internal Revenue Code of 1986.
SECTION 2. Exercisability
-------------------------
Subject to further terms of this Agreement, the Option shall become exercisable
in four substantially equal installments, the first of which shall become
exercisable on the first anniversary of the date of this Agreement and the
remaining three of which shall become exercisable, respectively, on the second,
third and fourth anniversary of the date of this Agreement. Unless earlier
terminated pursuant to the provisions of the Plan, the unexercised portion of
the Option shall expire and cease to be exercisable at 12:01 a.m. on the 10th
anniversary of the date of this Agreement.
SECTION 3. Method of Exercise
-----------------------------
The Option or any part thereof may be exercised only by the giving of written
notice to the Company on such form and in such manner as the Committee shall
prescribe. Such written notice must be accompanied by payment of the full
purchase price for the number of shares being purchased. Such payment may be
made by one or a combination of the following methods: (a) by a check acceptable
to the Company; (b) with consent of the Committee, by delivery of shares of
Common Stock acquired prior to the option exercise date and having a Fair Market
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Value on the exercise date equal to part or all of the exercise price; or ( c)
by such other method as the Committee may authorize. The date of exercise of the
Option shall be the date on which written notice of exercise is hand delivered
to the Company, during normal business hours, at its address as provided in
Section 6 of this Agreement, or, if mailed, the date on which it is postmarked,
provided such notice is actually received.
SECTION 4. Termination of Employment; Death
-------------------------------------------
4.1 Upon Termination of Employment of the Optionee for any reason, the Option
shall terminate and expire except as provided in Section 4.2 or 4.3 of this
Agreement.
4.2 In the event of the Termination of Employment of the Optionee for any
reason other than death or dismissal for cause, the Option shall be
exercisable but only to the extent it was exercisable at the time of such
termination and only until the earlier of the expiration date of the
Option, determined pursuant to Section 2 of this Agreement, or the
expiration of three months following termination.
4.3 In the event of the Termination of Employment of the Optionee by reason of
death, or if the Optionee dies during the period in which the Option is
exercisable pursuant to Section 4.2 of this Agreement, the Option shall be
exercisable but only to the extent it was exercisable at the time of death
and only until the earlier of the expiration date of the Option, determined
pursuant to Section 2 of this Agreement, or the first anniversary of the
date of the Optionee's death.
SECTION 5. Notices
------------------
This Agreement is subject to all of the terms and provisions of the Plan.
Without limiting the generality of the foregoing, by entering into this
Agreement the Optionee agrees that no member of the Committee shall be liable
for any action or determination made in good faith with respect to the Plan or
any award thereunder or this Agreement. In the event that there is any
inconsistency between the provisions of this Agreement and of the Plan, the
provisions of the Plan shall govern.
SECTION 6. Notices
------------------
Any notice to be given to the Company hereunder shall be in writing and shall be
addressed to Greg Manning Auctions, Inc., 775 Passaic Avenue, West Caldwell, New
Jersey 07006, or at such other address as the Company may hereafter designate to
the Optionee by notice as provided in this Section 6. Any notice to be given to
the Optionee hereunder shall be addressed to the Optionee at the address set
forth beneath his signature hereto, or at such other address as the Optionee may
hereafter designate to the Company by notice as provided herein. A notice shall
be deemed to have been duly given when personally delivered or mailed by
registered or certified mail to the party entitled to receive it.
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SECTION 8. Successors and Assigns
---------------------------------
This Agreement shall be binding upon and inure to the benefit of the parties
hereto and the successors and assigns of the Company and, to the extent
consistent with Section 4 of this Agreement and with the Plan, the heirs and
personal representatives of the Optionee.
SECTION 9. Transferability
--------------------------
During the lifetime of the Optionee, the Option granted hereby may be exercised
only by the Optionee. The Option granted hereby is not assignable or
transferable other than by will or the laws of descent and distribution.
SECTION 10. Notice of Certain Dispositions
------------------------------------------
The Optionee hereby agrees to give the Company written notice within 10 days in
the event the Optionee disposes of any shares of Common Stock acquired upon the
exercise of this Option prior to the expiration of two years after the grant
date and one year after the date the shares were acquired.
SECTION 11. Incorporation of the Plan
-------------------------------------
All terms, conditions and restrictions of the Plan are incorporated herein and
made a part hereof as if stated herein. If there is a conflict between the terms
and conditions of the Plan and this Agreement, the terms and conditions of the
Plan shall govern.
SECTION 12. Governing Law
-------------------------
This Agreement shall be interpreted, construed and administered in accordance
with the laws of the State of New York as they apply to contracts made,
delivered and performed in the State of New York without reference to the
provisions governing conflicts of law.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first written above.
GREG MANNING AUCTIONS, INC.
ATTEST:________________________
By:____________________________
Title:
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OPTIONEE
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Larry Crawford
Address:________________________
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Social Security Number
12