Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement, dated as of October 15, 2018 (this “Agreement”), is
by and between OTELCO INC., a Delaware corporation (“Otelco” or the “Company”),
and RICHARD CLARK (the “Employee”).

 

WHEREAS, the Company and the Employee desire to enter into this Agreement.

 

NOW THEREFORE, in consideration of the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

 

Section 1.      Effective Date.

 

This Agreement shall become effective on October 15, 2018 (the “Effective
Date”).

 

Section 2.      Employment Period.

 

Subject to Section 4, the Company hereby agrees to employ the Employee, and the
Employee hereby agrees to be employed by the Company, in accordance with the
terms and provisions of this Agreement, for the period from the Effective Date
through the Termination Date (the “Employment Period”).

 

Section 3.      Terms of Employment.

 

(a)   Duties and Position. During the Employment Period, the Employee shall
serve as the Chief Operating Officer of the Company. As such, the Employee shall
have duties and responsibilities commensurate with such position and such other
duties and responsibilities as may from time to time be assigned to or vested in
the Employee by the Company’s board of directors (the “Board”) or the Company’s
Chief Executive Officer. The Employee shall report to the Company’s Chief
Executive Officer.

 

(b)   Full Time. During the Employment Period, and excluding any periods of
vacation and sick leave to which the Employee may be entitled, the Employee
agrees to devote his full business time and efforts, to the best of his ability,
experience and talent, to the business and affairs of the Company. During the
Employment Period, it shall not be a violation of this Agreement for the
Employee to serve on corporate, civic or charitable boards or committees or
manage personal investments (including serving as a member of boards of
directors or similar bodies of entities not engaged in competition with the
Company (as determined by the Board in its reasonable discretion)), in each
case, so long as such activities do not interfere with the performance of the
Employee’s responsibilities as an employee of the Company in accordance with
this Agreement.

 

(c)   Compensation.

 

(i)             Base Salary. During the Employment Period, the Employee shall
receive an annual base salary of $275,000, subject to increase by the Company
(as so increased, the “Annual Base Salary”). The Annual Base Salary shall be
paid in accordance with the customary payroll practices of the Company, subject
to withholding and other payroll taxes.

 

 

 

 

(ii)              Bonus. In fiscal year 2019 and each fiscal year during the
Employment Period thereafter, the Employee shall be eligible for a discretionary
incentive bonus of up to 45% of the Annual Base Salary (the “Bonus”). The Bonus
shall be based upon the Company achieving operating and/or financial goals to be
established by the Board or any duly appointed committee thereof in good faith,
in its sole discretion. The Bonus will be paid either in cash, Class A common
stock, par value $0.01 per share, of the Company (“Stock”) or a combination of
cash and Stock, as determined by the Board and the Company’s Chief Executive
Officer; provided, however, that at least 33% of any Bonus earned will be paid
in cash. For the Company’s 2018 fiscal year, the Company shall pay the Employee
a guaranteed minimum Bonus, in cash, in 2019, in an amount equal to $26,106. Any
Bonus paid pursuant to this Section 3(c)(ii) shall be subject to withholding and
other payroll taxes and will be paid at a time and in a manner consistent with
the Company’s payment of bonus compensation to the Company’s executives,
generally.

 

(iii)            Equity Participation. Upon the Effective Date, the Employee
shall receive options to purchase 50,000 shares of Stock, subject to the terms
and conditions of the 2018 Stock Incentive Plan of the Company, which will vest
in equal annual installments over a five-year period following the Effective
Date. In the event that the Employee is named the Chief Executive Officer of the
Company, the Employee shall receive upon his appointment to such position
options to purchase an additional 50,000 shares of Stock, subject to the terms
and conditions of the 2018 Stock Incentive Plan of the Company, which will vest
in equal annual installments over a five-year period thereafter.

 

(iv)           Benefits. During the Employment Period, the Employee shall be
eligible to participate in all employee benefit plans or programs offered
generally to other executives of the Company, to the extent that the Employee’s
position, tenure, salary, health and other qualifications make the Employee
eligible to participate. Without limiting the foregoing, the Employee shall be
eligible to participate in any incentive, savings and retirement plans, and any
group life, health, dental or accident insurance or any such other plan or
policy that may be in effect or that may hereafter be adopted by the Company for
the benefit of its employees generally. The Employee’s participation in such
benefits shall be subject to the terms of the applicable plans, as the same may
be amended from time to time. The Company does not guarantee the adoption or
continuance of any particular employee benefit during the Employee’s employment,
and nothing in this Agreement is intended to, or shall in any way restrict the
right of the Company to, amend, modify or terminate any of its benefits.

 

(v)            Automobile. During the Employment Period, the Company shall
provide the Employee with the use of a Company automobile (or, at the Company’s
option, shall lease an automobile for the Employee’s use) and shall reimburse
the Employee for all reasonable expenses incurred by the Employee in connection
with the use and maintenance of such automobile.

 

2 

 

 

(vi)           Expenses. The Employee shall be entitled to receive reimbursement
for all reasonable expenses incurred by the Employee during the Employment
Period in connection with the performance of his duties hereunder, in accordance
with the policies, practices and procedures of the Company as in effect from
time to time.

 

(vii)          Vacation and Holidays. During the Employment Period, the Employee
shall be entitled to paid holidays and up to five weeks’ vacation per year, in
each case, in accordance with the policies of the Company generally applicable
to other executives of the Company.

 

Section 4.      Termination of Employment.

 

(a)   Death or Disability. The Employee’s employment shall terminate
automatically upon the Employee’s death. If the Company intends to terminate the
Employee’s employment due to Disability, the Company shall give to the Employee
written notice of its intention to terminate the Employee’s employment. In such
event, the Employee’s employment with the Company shall terminate effective on
the 30th day after receipt of such notice by the Employee if, within the 30 days
after such receipt, the Employee shall not have returned to full-time
performance of the Employee’s duties. For purposes of this Agreement,
“Disability” shall mean the Employee’s inability to perform the essential
functions of his position, with or without accommodation, for any 90 days during
a period of 180 consecutive days due to mental or physical incapacity as
determined by a physician selected by the Company or its insurers.

 

(b)   Termination by the Employee. The Employee may terminate his employment
with the Company at any time, without prior written notice (other than a Notice
of Termination (as defined below)), for Good Reason or Without Good Reason.
“Good Reason” shall mean that any of the following shall have occurred: (i) the
Company relocates its corporate headquarters and asks the Employee to relocate
to an area greater than 35 miles from the location of the Company’s corporate
headquarters as of the date hereof; or (ii) the Employee has not become the
Company’s Chief Executive Officer by January 1, 2020 (or such other date that is
mutually agreed in writing between the Company and the Employee). “Without Good
Reason” shall mean a termination by the Employee of his employment during the
Employment Period for any reason other than a termination based upon Good
Reason.

 

(c)   Termination by the Company. The Company may terminate the Employee’s
employment with the Company at any time, for Cause or Without Cause. “Cause”
will mean that any of the following will have occurred: (i) the Employee has
failed to competently perform his duties and responsibilities; (ii) the Employee
has violated any of the rules, policies, regulations, guidelines, directions or
restrictions of the Company; (iii) the Employee has breached his other duties or
obligations to the Company and has not cured or remedied such breach to the
Company’s satisfaction within 10 days after the Employee receives written notice
from the Company of such breach; (iv) the Employee has engaged in any theft,
embezzlement or misappropriation of the Company’s property; or (v) the Employee
has breached the terms of this Agreement. “Without Cause” shall mean a
termination by the Company of the Employee’s employment during the Employment
Period for any reason other than a termination based upon Cause, death or
Disability.

 

3 

 

 

(d)   Notice of Termination. Any termination by the Company for Cause or Without
Cause or by the Employee for Good Reason or Without Good Reason shall be
communicated by Notice of Termination to the other party hereto. For purposes of
this Agreement, a “Notice of Termination” means a written notice which (i)
indicates the specific termination provision(s) in this Agreement relied upon,
(ii) to the extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Employee’s
employment under the provision(s) so indicated and (iii) if the date of
termination is other than the date of receipt of such notice, specifies the
termination date (the “Termination Date”).

 

(e)   Separation from Service. The term “termination” or “termination of
employment” when used in this Agreement shall mean a “Separation from Service”
as such term is defined using the default rules in Treasury Regulation Section
1.409A-1(h).

 

Section 5.      Obligations of the Company upon Termination.

 

(a)   Without Cause; Death or Disability; by the Employee for Good Reason. If,
during the Employment Period, the Company terminates the Employee’s employment
Without Cause or due to death or Disability, or if the Employee terminates his
employment with the Company for Good Reason, then the Company will provide the
Employee with the following severance payments and/or benefits:

 

(i)             The Company shall pay to the Employee a lump sum in the amount
of the Employee’s accrued but unpaid Annual Base Salary through the Termination
Date (“Accrued Obligations”);

 

(ii)            To the extent the Employee and, if applicable, members of his
family participate in any medical, prescription drug, dental, vision or other
“group health plan” of the Company immediately prior to the Termination Date,
the Company shall pay to the Employee a lump sum in the amount equal to the
premium cost to the Employee of continued coverage for the Employee and, if
applicable, members of his family that would be incurred for continuation
coverage under such plans in accordance with Section 4980B of the Internal
Revenue Code of 1986, as amended, and Part 6 of Title 1 of the Employee
Retirement Income Security Act of 1974, as amended, through the end of the
fiscal year in which the Termination Date occurs;

 

(iii)           The Company shall pay to the Employee a lump sum in a gross
amount equal to his Annual Base Salary within six (6) months following
termination but not later than March 14 of the calendar year following
termination; and

 

(iv)          The Company shall pay to the Employee a lump sum amount equal to
the Bonus the Employee would have received had he remained employed by the
Company through the end of the fiscal year in which the termination occurred,
pro rated for the number of days the Employee was employed by the Company during
such fiscal year, to be paid at the same time that similar bonuses are paid to
the Company’s other employees.

 

(b)   Cause; by the Employee Without Good Reason. If the Employee’s employment
shall be terminated by the Company for Cause or by the Employee Without Good
Reason, then the Company shall have no further payment obligations to the
Employee (or his heirs or legal representatives) other than for (i) payment of
Accrued Obligations and (ii) the continuance of the Employee’s and, if
applicable, members of his family’s participation in the Company’s welfare and
benefit plans through the Termination Date.

 

4 

 

 

(c)   Condition; Release. The Employee acknowledges and agrees that the
Company’s obligations to make payments under Section 5(a) will be conditioned on
the Employee executing and delivering a customary general release in form and
substance reasonably satisfactory to the Company. The Company shall provide to
the Employee a form of release of claims no later than three days following the
Employee’s date of Separation from Service. The Employee must execute and
deliver the release of claims within 20 days after the Employee’s date of
Separation from Service. If the Employee does not timely execute and deliver to
the Company such release, or if the Employee does so, but then revokes it if
permitted by and within the time required by applicable law, the Company will
have no obligation to pay severance compensation to the Employee.

 

(d)   Delay for Specified Employees. If the Employee is a “Specified Employee”
within the meaning of Section 409A of the Internal Revenue Code of 1986, as
amended (“Section 409A”), and determined pursuant to procedures adopted by the
Company at the time of the Employee’s Separation from Service and any amount
that would be paid to the Employee during the six-month period following
Separation from Service constitutes deferred compensation (within the meaning of
Section 409A), such amount shall not be paid to the Employee until six months
following the Employee’s Separation from Service. On the first regular payroll
date following the expiration of such six-month period (or if the Employee dies
during the six-month period, the first payroll date following death), all
payments that were delayed pursuant to the preceding sentence shall be paid to
the Employee in a single lump sum and thereafter all payments shall be made as
if there had been no such delay. In addition, if the Employee becomes entitled
to severance compensation, such payments shall be considered, and are hereby
designated as, a series of separate payments for purposes of Section
409A. Further, all severance compensation payable under this Agreement shall be
paid by, and no further severance compensation shall be paid or payable after,
December 31 of the second calendar year following the year in which the
Employee’s Separation from Service occurs.

 

(e)   Section 409A Compliance. To the extent applicable, it is intended that the
compensation arrangements under this Agreement be in full compliance with
Section 409A. This Agreement shall be construed in a manner to give effect to
such intention. In no event whatsoever shall the Company or any of its
Affiliates be liable for any tax, interest or penalties that may be imposed on
the Employee under Section 409A. Neither the Company nor any of its Affiliates
have any obligation to indemnify or otherwise hold the Employee harmless from
any or all such taxes, interest or penalties, or liability for any damages
related thereto.

 

Section 6.      Nondisclosure and Nonuse of Confidential Information.

 

(a)   The Employee shall not disclose or use at any time, either during the
Employment Period or thereafter, any Confidential Information (as hereinafter
defined) of which the Employee is or becomes aware as a consequence of or in
connection with his employment with the Company, whether or not such information
is developed by him, except (i) to the extent that such disclosure or use is in
furtherance of the Employee’s performance in good faith of his duties as the
Company’s Chief Operating Officer, or (ii) to the extent required by law or
legal process; provided that (A) the Employee agrees to provide the Company with
prompt written notice of any such law or legal process and to assist the
Company, at the Company’s expense, in asserting any legal challenges to or
appeals of such law or legal process that the Company in its sole discretion
pursues, and (B) in complying with any such law or legal process, the Employee
shall limit his disclosure only to the Confidential Information that is
expressly required to be disclosed by such law or legal process. The Employee
will take all commercially reasonable steps to safeguard Confidential
Information and to protect it against disclosure, misuse, espionage, loss and
theft. The Employee shall deliver to the Company on the Termination Date, or at
any time the Company may request, all memoranda, notes, plans, records, reports,
computer tapes and software and other documents and data (and copies thereof)
relating to the Confidential Information or the Work Product (as hereinafter
defined) of the Company which the Employee may then possess or have under his
control.

 

5 

 

 

(b)   The Employee agrees that all Work Product belongs in all instances to the
Company. The Employee will promptly disclose such Work Product to the Board and
perform all actions reasonably requested by the Board (whether during or after
the Employment Period) to establish and confirm the Company’s ownership of the
Work Product (including, without limitation, the execution and delivery of
assignments, consents, powers of attorney and other instruments) and to provide
reasonable assistance to the Company (whether during or after the Employment
Period), at the Company’s sole expense, in connection with the prosecution of
any applications for patents, trademarks, trade names, service marks or reissues
thereof or in the prosecution or defense of interferences relating to any Work
Product. The Employee recognizes and agrees that the Work Product, to the extent
copyrightable, constitutes works for hire under the copyright laws of the United
States.

 

(c)   “Confidential Information” means information that is not generally known
to the public and that is used, developed or obtained by the Company or its
Affiliates in connection with their business, including, but not limited to,
information, observations and data obtained by the Employee while employed by
the Company or any predecessors thereof (including those obtained prior to the
date of this Agreement) concerning (i) the business or affairs of Otelco or its
Affiliates and (ii) products, services, fees, costs, pricing structures,
analyses, drawings, photographs and reports, computer software (including
operating systems, applications and program listings), data bases, accounting
and business methods, inventions, devices, new developments, methods and
processes (whether patentable or unpatentable and whether or not reduced to
practice), customers and clients and customer and client lists, all technology
and trade secrets, and all similar and related information in whatever form.
Confidential Information will not include any information that (A) is or becomes
generally available to the public other than through disclosure by the Employee
in violation of this Section 6, (B) was provided to the Employee prior to the
date hereof on a non-confidential basis from a Person who was not otherwise
bound by a confidentiality agreement or duty to Otelco or its Affiliates or (C)
becomes available to the Employee on a non-confidential basis from a Person who
is not otherwise bound by a confidentiality agreement with or duty to Otelco or
its Affiliates or is not otherwise prohibited from transmitting the information
to the Employee.

 

(d)   “Work Product” means all inventions, innovations, improvements, technical
information, systems, software developments, methods, designs, analyses,
drawings, reports, service marks, trademarks, trade names, trade dress, logos
and all similar or related information (whether patentable or unpatentable)
which relates to the Company’s or any of its Affiliate’s actual or anticipated
business, research and development or existing or future products or services
and which are conceived, developed or made by the Employee (whether or not
during usual business hours and whether or not alone or in conjunction with any
other Person) during the Employment Period together with all patent
applications, letters patent, trademark, trade name and service mark
applications or registrations, copyrights and reissues thereof that may be
granted for or upon any of the foregoing.

 

6 

 

 

(e)    Notwithstanding any other provision of this Agreement, the Company hereby
notifies the Employee, pursuant to the Defend Trade Secrets Act, that he will
not be held criminally or civilly liable under any federal or state trade secret
law for the disclosure of a trade secret that: (i) is made (x) in confidence to
a federal, state or local government official, either directly or indirectly, or
to an attorney; and (y) solely for the purpose of reporting or investigating a
suspected violation of law; or (ii) is made in a complaint or other document
that is filed under seal in a lawsuit or other proceeding. The Company further
notifies the Employee that if he files a lawsuit for retaliation by the Company
for reporting a suspected violation of law, the Employee may disclose the
Company’s trade secrets to his attorney and use the trade secret information in
the court proceeding if he: (i) files any document containing the trade secret
under seal; and (ii) does not disclose the trade secret, except pursuant to
court order. The Employee further understands that certain whistleblower laws
permit him to communicate directly with governmental or regulatory authorities
about possible violations of law. The Employee acknowledges that he is not
required to seek the Company’s permission or notify the Company of any
communications made in compliance with applicable whistleblower laws, and that
the Company will not consider such communications to violate this Agreement or
any prior agreements between the Employee and the Company.

 

Section 7.      Non-Compete and Non-Solicit.

 

(a)   The Employee acknowledges that, in the course of the Employee’s employment
with the Company, the Employee has become familiar, or will become familiar,
with Otelco’s and its Affiliates’ trade secrets and with other Confidential
Information concerning Otelco and its Affiliates and that his services have been
and will be of special, unique and extraordinary value to Otelco and its
Affiliates. Therefore, the Employee agrees that, during the Employment Period
and for 12 months thereafter (the “Restricted Period”), the Employee shall not
directly or indirectly (i) engage, within the Restricted Territory, in any
telephone or communications business, including, but not limited to, incumbent
local exchange carrier, competitive local exchange carrier, broadband, long
distance telephone business, cable television, Internet access, wireless or
other business that Otelco or any of its Affiliates is engaged in during the
Employee’s employment by the Company (the “Company Business”), (ii) compete or
participate as agent, employee, consultant, advisor, representative or otherwise
in any enterprise engaged in a business which has any operations engaged in the
Company Business within the Restricted Territory or (iii) compete or participate
as a stockholder, partner, member or joint venturer, or have any direct or
indirect financial interest, in any enterprise which has any material operations
engaged in the Company Business within the Restricted Territory; provided,
however, that nothing contained herein will prohibit the Employee from (A)
owning, operating or managing any business, or acting upon any business
opportunity, after obtaining approval of a majority of the Board or (B) owning
no more than five percent (5%) of the equity of any publicly traded entity with
respect to which the Employee does not serve as an officer, director, employee,
consultant or in any other capacity other than as an investor. The term
“Restricted Territory” means all states within the United States in which Otelco
or any of its Affiliates conducts or is pursuing or analyzing plans to conduct
Company Business as of the Termination Date.

 

7 

 

 

(b)   As a means reasonably designed to protect Confidential Information and the
Company’s good will, the Employee agrees that, during the period commencing on
the Effective Date and ending on the expiration of the Restricted Period, the
Employee will not (i) solicit or make any other contact with, directly or
indirectly, any customer of Otelco or any of its Affiliates as of the date that
the Employee ceases to be employed by the Company with respect to the provision
of any service to any such customer that is the same or substantially similar to
any service provided to such customer by Otelco or any of its Affiliates or (ii)
solicit or make any other contact with, directly or indirectly, any employee of
Otelco or any of its Affiliates on the date that the Employee ceases to be
employed by the Company (or any Person who was employed by Otelco or any of its
Affiliates at any time during the three-month period prior to the Termination
Date) with respect to any employment, services or other business relationship.

 

Section 8.      Remedies.

 

The Employee acknowledges that irreparable damage to the Company would occur in
the event of a breach of the provisions of Section 6 or Section 7 by the
Employee. Therefore, the Employee agrees that, in addition to any other remedy
to which it is entitled at law or in equity, the Company shall have the right to
enforce the provisions of Sections 6 and 7 by applying for and obtaining
temporary and permanent restraining orders or injunctions from a court of
competent jurisdiction, without the necessity of filing a bond, in order to
prevent breaches of such Sections of this Agreement and to enforce specifically
the terms and provisions thereof.

 

Section 9.      Definitions.

 

“Accrued Obligations” has the meaning set forth in Section 5(a)(i).

 

“Affiliate” means, with respect to any Person, any other Person that is
controlled by, controlling or under common control with, such Person.
Notwithstanding anything to the contrary contained herein, with respect to
Otelco, the term “Affiliate” will include, without limitation, each Person with
an ownership interest in Otelco (and each member, stockholder or partner of each
such Person) and each Person in which any stockholder of Otelco (and each
member, stockholder or partner of each such Person) holds or has the right to
acquire, collectively, more than 10% of the voting equity interests.

 

“Agreement” has the meaning set forth in the Caption.

 

“Annual Base Salary” has the meaning set forth in Section 3(c)(i).

 

“Board” has the meaning set forth in Section 3(a).

 

“Bonus” has the meaning set forth in Section 3(c)(ii).

 

“Business Day” means any day that is not a Saturday, Sunday, legal holiday or
other day on which banks are required to be closed in New York, New York.

 

8 

 

 

“Cause” has the meaning set forth in Section 4(c).

 

“Company” has the meaning set forth in the Caption.

 

“Company Business” has the meaning set forth in Section 7(a).

 

“Confidential Information” has the meaning set forth in Section 6(c).

 

“Disability” has the meaning set forth in Section 4(a).

 

“Effective Date” has the meaning set forth in Section 1.

 

“Employee” has the meaning set forth in the Caption.

 

“Employment Period” has the meaning set forth in Section 2.

 

“Good Reason” has the meaning set forth in Section 4(b).

 

“Otelco” has the meaning set forth in the Caption.

 

“Notice of Termination” has the meaning set forth in Section 4(d).

 

“Person” means an individual, partnership, corporation, limited liability
company, trust or unincorporated organization, or a government or agency or
political subdivision thereof.

 

“Restricted Period” has the meaning set forth in Section 7(a).

 

“Restricted Territory” has the meaning set forth in Section 7(a).

 

“Section 409A” has the meaning set forth in Section 5(d).

 

“Separation from Service” has the meaning set forth in Section 4(e).

 

“Stock” has the meaning set forth in Section 3(c)(iii).

 

“Termination Date” has the meaning set forth in Section 4(d).

 

“Without Cause” has the meaning set forth in Section 4(c).

 

“Without Good Reason” has the meaning set forth in Section 4(b).

 

“Work Product” has the meaning set forth in Section 6(d).

 

Section 10.  General Provisions.

 

(a)   Severability. It is the desire and intent of the parties hereto that the
provisions of this Agreement be enforced to the fullest extent permissible under
the laws and public policies applied in each jurisdiction in which enforcement
is sought. Accordingly, if any particular provision of this Agreement shall be
adjudicated by a court of competent jurisdiction to be invalid, prohibited or
unenforceable for any reason, such provision, as to such jurisdiction, shall be
ineffective, without invalidating the remaining provisions of this Agreement or
affecting the validity or enforceability of such provision in any other
jurisdiction. Notwithstanding the foregoing, if such provision could be more
narrowly drawn so as not to be invalid, prohibited or unenforceable in such
jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without
invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.

 

9 

 

 

(b)   Entire Agreement. This Agreement embodies the complete agreement and
understanding among the parties hereto with respect to the subject matter
hereof. This Agreement supersedes and preempts any prior understandings,
agreements or representations by or among the parties, written or oral, which
may have related to the subject matter hereof in any way.

 

(c)   Survival. Notwithstanding anything to the contrary contained herein, the
provisions of Section 6, Section 7 and Section 8 shall survive the termination
of this Agreement.

 

(d)   Counterparts. This Agreement may be executed in separate counterparts,
each of which is deemed to be an original and all of which taken together
constitute one and the same agreement.

 

(e)   Successors and Assigns; Beneficiaries. This Agreement is personal to the
Employee and without the prior written consent of the Company shall not be
assignable by the Employee other than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by
the Employee’s heirs and legal representatives and the successors and assigns of
the Company. The Company reserves the right to assign this Agreement in whole or
in part to any of its Affiliates and upon any such assignment, the term
“Company” will be deemed to be such Affiliate.

 

(f)    Governing Law. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY
CHOICE OF LAW OR CONFLICTING PROVISION OR RULE (WHETHER OF THE STATE OF NEW YORK
OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE LAWS OF ANY JURISDICTION OTHER
THAN THE STATE OF NEW YORK TO BE APPLIED. IN FURTHERANCE OF THE FOREGOING, THE
INTERNAL LAW OF THE STATE OF NEW YORK WILL CONTROL THE INTERPRETATION AND
CONSTRUCTION OF THIS AGREEMENT, EVEN IF UNDER SUCH JURISDICTION’S CHOICE OF LAW
OR CONFLICT OF LAW ANALYSIS, THE SUBSTANTIVE LAW OF SOME OTHER JURISDICTION
WOULD ORDINARILY APPLY.

 

(g)   Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ITS
RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THE PARTIES HERETO RELATING TO THE
SUBJECT MATTER HEREOF.

 

(h)   Amendment and Waiver. The provisions of this Agreement may be amended and
waived only with the prior written consent of the Employee and the Company and
no course of conduct or failure or delay in enforcing the provisions of this
Agreement shall be construed as a waiver of such provisions or affect the
validity, binding effect or enforceability of this Agreement or any provision
hereof.

 

10 

 

 

(i)     Notices. All notices, requests, demands, claims, consents and other
communications which are required or otherwise delivered hereunder shall be in
writing and shall be deemed to have been duly given if (i) personally delivered
or transmitted by electronic mail, (ii) sent by nationally recognized overnight
courier, (iii) mailed by registered or certified mail with postage prepaid,
return receipt requested, or (iv) transmitted by facsimile (with a copy of such
transmission concurrently transmitted by registered or certified mail with
postage prepaid, return receipt requested), to the parties hereto at the
following addresses (or at such other address for a party as shall be specified
by like notice):

 

If to the Board or the Company, to:

 

Otelco Inc.
56 Campus Drive
New Gloucester, Maine 04260
Attention: Robert J. Souza
Telephone No: (207) 688-8241
Facsimile No: (207) 688-8833
Electronic Mail: rob.souza@otelco.com

 

with a copy to:

 

Dorsey & Whitney LLP
51 West 52nd Street
New York, New York 10019
Attention: Steven Khadavi, Esq.
Telephone No: (212) 415-9376
Facsimile No: (646) 390-6549
Electronic Mail: khadavi.steven@dorsey.com

 

If to the Employee to:

 

Richard Clark
45 Fiddlehead Lane

Freeport, Maine 04032
Telephone No: (540) 520-4481

Electronic Mail: rclarkme@gmail.com

or to such other address as the party to whom such notice or other communication
is to be given may have furnished to each other party in writing in accordance
herewith. Any such notice or communication shall be deemed to have been received
(i) when delivered, if personally delivered or transmitted by electronic mail,
with receipt acknowledgment by the recipient by return electronic mail, (ii)
when sent, if sent by facsimile on a Business Day during normal business hours
(or, if not sent on a Business Day during normal business hours, on the next
Business Day after the date sent by facsimile), (iii) on the next Business Day
after dispatch, if sent by nationally recognized, overnight courier guaranteeing
next Business Day delivery and (iv) on the fifth Business Day following the date
on which the piece of mail containing such communication is posted, if sent by
mail.

 

11 

 

 

(j)     Descriptive Headings. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.

 

(k)   Construction. Where specific language is used to clarify by example a
general statement contained herein, such specific language shall not be deemed
to modify, limit or restrict in any manner the construction of the general
statement to which it relates. The language used in this Agreement shall be
deemed to be the language chosen by the parties to express their mutual intent,
and no rule of strict construction shall be applied against any party.

 

(l)    Nouns and Pronouns. Whenever the context may require, any pronouns used
herein shall include the corresponding masculine, feminine or neuter forms, and
the singular form of nouns and pronouns shall include the plural and vice-versa.

 

[Signature page follows]

 

 

12 

 

 

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

 

  OTELCO inc.               By:

/s/ Robert J. Souza

   

Name: Robert J. Souza

Title: Chief Executive Officer

              employee                

/s/ Richard Clark

    Richard Clark