Exhibit 10.7.1


 


AMENDMENT DATED AS OF MARCH 29, 2006


TO THE JANUARY 28, 2005 CHANGE OF CONTROL
AGREEMENT


BETWEEN


ETS PAYPHONES, INC. and DAVID C. JONES


 


This Amendment to the Change of Control Agreement (the “Amendment”)
dated as of January 28, 2005 (the “Agreement”) between ETS Payphones, Inc. (the
“Company”) and David C. Jones (the “Employee”), is made effective as of March
29, 2006.


 


Whereas at the Annual Meeting of Stockholders, held on February 15,
2006, the stockholders of the Company approved, among other things, the
consummation of the Asset Sale Agreement between the Company and Empire
Payphones, Inc., dated as of November 1, 2005 (the “Asset Sale Agreement”) and
the transactions contemplated thereby and the dissolution and the winding down
of the Company’s operations following the closing (the “Closing”) of the Asset
Sale Agreement.


 


Whereas the Board of Directors of the Company has determined that it is
in the best interests of the Company that the change of control provisions of
the Agreement be amended to ensure that Employee continue to serve the Company
after the Closing, in order that the Closing and the dissolution and winding
down of the Company thereafter are efficiently administered.


 


In consideration of the mutual agreements herein contained, and for
other good and valuable consideration the receipt and sufficiency of which are
hereby acknowledged, the Company and the Employee hereby agree as follows:


 


1.                                       Section 1(f) of
the Agreement is deleted and replaced in its entirety by the following:


 


(f)            Reserved


 


2.                                       Section 2 of the
Agreement is deleted and replaced in its entirety by the following:


 


The Term of this Agreement shall commence on the Commencement Date and
shall continue in effect through the first anniversary of the Commencement Date,
provided, however, that if an Incentive Payment is paid to the Employee
pursuant to Section 3 of this Agreement, as amended, the Term shall expire
three months beyond the month in which such Incentive Payment is paid to the
Employee.


 


3.                                       Section 3 is deleted
and replaced in its entirety by the following:


 


In order to induce the Employee to remain in the employ of the Company
and in consideration of the Employee’s covenants set forth in Section 4 hereof,
the Company agrees, under the conditions described herein: (A) that the Company
shall pay to the Employee a lump sum (an “Incentive Payment”) equal to his base
salary for six (6) months based on the Employee’s annual base salary as of the
date of the payment of the Incentive Payment (the “Base Salary”) upon the
earlier of (i) May 16, 2006 or (ii) 60 days after the closing of the Asset Sale
Agreement between the Company and Empire Payphones, Inc., dated as of November
1, 2005 and (B) to continue medical insurance for the Employee and his
dependents on the same terms as exist on the date of termination of the
Employee for six (6) months following the date of termination of the Employee
and after that six (6) month period Employee shall be entitled to elect
eighteen (18) months of continuation coverage under COBRA, if the Company has
not terminated its medical insurance coverage plan. If the Company terminates
its medical insurance coverage plan, it shall reimburse the Employee for the
cost of obtaining substantially similar coverage as existed for the Employee on
the day prior to such termination for the six months of coverage following the
date of termination. It is understood by both parties hereto that upon payment
of the Incentive Payment, the Base Salary of the Employee shall be reduced to
one half of the Base Salary, effective as of the date of the payment of the
Incentive Payment. Nothing contained herein shall limit or impinge any other
rights or remedies of the Company or the 


 


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Employee under any other agreement or plan to which the Employee is a
party or of which the Employee is a beneficiary.


 


This Agreement shall not be construed as creating an express or implied
contract of employment and, except as otherwise agreed in writing between the
Employee and the Company, the Employee shall not have any right to be retained
in the employ of the Company.


 


4.                                       Section 8 of the
agreement shall be amended to delete notice to Brian Gannon, Esq. and to
provide notice to the following:


 


Shannon Lowry Nagle, Esq.


Stroock & Stroock & Lavan LLP


180 Maiden Lane


New York, NY 10038


 


5.                                       All other
provisions of the Agreement not specifically amended by this Amendment shall
remain in full force and effect. All capitalized but undefined terms used
herein shall have the meaning ascribed to them in the Agreement. This Agreement
may be executed simultaneously in two or more counterparts each of which shall
be deemed an original and all of which shall be deemed one and the same
agreement. A photocopy or facsimile reproduction of this Amendment and any
signatures shall be deemed as effective as the original.


 


IN WITNESS WHEREOF, the Company and the Employee have each executed and
delivered this Agreement as of the effective date shown above.


 


	
   

  	
  COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ GUY A. LONGOBARDO

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Director, President and Chief Executive Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  March 29, 2006

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  MICHAEL
  H. MCCLELLAN

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Director, Executive Vice President and Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  March 29, 2006

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  EMPLOYEE

  
	
   

  	
   

  
	
   

  	
  /s/ DAVID C. JONES

  	
   

  
	
   

  	
  David C. Jones

  
											



 


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