ex10-1.htm


    
      

    

    Exhibit
10.1

     

     

    AMENDED AND RESTATED EMPLOYMENT
AGREEMENT dated as of March 11, 2009 (this

    “Agreement”), among
OTELCO INC., a Delaware corporation
(the “Company”)
and

    MICHAEL WEAVER (the
“Executive”).

     

    WHEREAS, the Executive and
Otelco Telephone LLC, a Delaware limited liability company and a wholly-owned
subsidiary of the Company, have entered into that certain Amended and Restated
Employment Agreement, dated as of June 21, 2004, as amended on December 22,
2008 (as amended, the “Prior
Agreement”).

     

    WHEREAS, the Company and the
Executive desire to amend and restate the terms of the Prior
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 be effective as of January 1, 2009 (the “Effective
Date”).

     

    
      Section
2.   Employment
Period.

    

     

    Subject
to Section 4,
the Company hereby agrees to employ the Executive, and the Executive 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.

     

    
      Section
3.   Terms of
Employment.

    

     

    (a)    Position.  During
the Employment Period, the Executive shall serve as Chief Executive Officer and
President of the Company and certain of its subsidiaries (collectively, the
“Company
Entities”) and shall report to the Board of Directors of the Company (the
“Board”) and
each such subsidiary.  The Executive shall have supervision and
control over, and responsibility for, the management and operational functions
of the Company Entities and shall have such other powers and duties (consistent
with the customary powers and duties of a chief executive officer) as may from
time to time be prescribed by the Board.

     

    (b)    Full
Time.  During the Employment Period, and excluding any periods
of vacation and sick leave to which the Executive is entitled, the Executive
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
Entities.  During the Employment Period, it shall not be a violation of
this Agreement for the Executive 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 Entities (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 Executive’s responsibilities as an
employee of the Company Entities in accordance with this Agreement.

     

    (c)    Compensation.

     

    (i)    Base
Salary.  During the Employment Period, the Executive shall
receive an annual base salary of $300,000, which Annual Base Salary shall be
subject to annual increase by an amount equal to reflect the increase in the
cost of living, if any, between the date of the immediately preceding increase
and the date of each such adjustment, based upon the Consumer Price Index for
Urban Consumers, or if that index is discontinued, a similar index prepared by a
department or agency of the United States government (as so adjusted, 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.  For
each fiscal year during the Employment Period, the Executive will be entitled to
receive a bonus (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.

     

    (iii)          
Benefits.  During
the Employment Period, the Executive shall be entitled to participate in all
incentive (including any long term incentive plan), savings and retirement
plans, practices, policies and programs applicable generally to other executives
of the Company Entities and shall be eligible for participation in and shall
receive all benefits under welfare benefit plans, practices, policies and
programs provided by the Company Entities to the extent applicable generally to
other executives of the Company Entities.  In addition, the Executive will
be entitled to the benefits specified herein.

     

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

     

    (v)   Expenses.  The
Executive shall be entitled to receive reimbursement for all reasonable expenses
incurred by the Executive 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.

     

    (vi)   Vacation and
Holidays.  During the Employment Period, the Executive shall be
entitled to paid vacation in accordance with the policies of the Company
applicable to other executives of the Company generally.

     

    
      Section
4.   Termination of
Employment.

    

     

    (a)    Death or
Disability.  The Executive’s employment shall terminate
automatically upon the Executive’s death.  If the Company intends to
terminate the Executive’s employment due to Disability, the Company shall give
to the Executive written notice of its intention to terminate the Executive’s
employment.  In such event, the Executive’s employment with the Company
shall terminate effective on the 30th day after receipt of such notice by the
Executive if, within the 30 days after such receipt, the Executive shall not
have returned to full-time performance of the Executive’s duties.  For
purposes of this Agreement, “Disability” shall
mean the Executive’s inability to perform his duties and obligations hereunder
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)    Cause.  The
Executive’s employment may be terminated at any time by the Company for Cause or
Without Cause.  “Cause” will mean that
any of the following will have occurred: (i) the Executive has been
convicted of a felony, stolen funds or otherwise engaged in fraudulent conduct,
(ii) the Executive has engaged in willful misconduct or has been grossly
negligent, in each case, which has been materially injurious to the Company,
(iii) the Executive has failed or refused to comply with directions of the Board
that are reasonably consistent with the Executive’s current position, or (iv)
the Executive has breached the terms of this Agreement.  “Without Cause” shall
mean a termination by the Company of the Executive’s employment during the
Employment Period for any reason other than a termination based upon Cause,
death or Disability.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    (c)    Termination by the
Executive.  The Executive may terminate his employment with the
Company at any time upon at least 60 days prior written notice
thereof.

     

    (d)    Notice of
Termination.  Any termination by the Company for Cause or
Without Cause or by the Executive for any 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 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 Executive’s employment under the
provision 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.  If, during the Employment Period, the Company
shall terminate the Executive’s employment Without Cause or due to death or
Disability, then the Company will provide the Executive with the following
severance payments and/or benefits:

     

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

     

    (ii)    The
Company shall continue to pay the Executive a lump sum in an amount equal to two
times his Annual Base Salary within six months following termination but not
later than March 14 of the calendar year following termination;

     

    (iii)          
The
Company shall pay to the Executive a lump sum amount equal to the Bonus the
Executive 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 Executive 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; and

     

    (iv)   The
Executive, if applicable, and members of his family shall be entitled to
continue their participation in the Company Entities’ welfare and benefit plans
until the second anniversary of the Termination Date.

     

    (b)    Cause; by the
Executive.  If the Executive’s employment shall be terminated
by the Company for Cause or by the Executive for any reason, then the Company
shall have no further payment obligations to the Executive (or his heirs or
legal representatives) other than for (i) payment of Accrued Obligations and
(ii) the continuance of the Executive’s and his family’s participation in
the Company Entities’ welfare and benefit plans through the Termination
Date.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    (c)    Condition;
Remedies.  The Executive acknowledges and agrees that the
Company’s obligations to make payments under Section 5(a)
will be conditioned on the Executive executing and delivering a customary
general release in form and substance reasonably satisfactory to the
Company.  Commencement of separation payments under this Agreement
shall begin on the first payroll date that occurs in the month that begins at
least 60 days after the date of Executive’s Separation from Service (the “Starting Date”),
provided that Executive has satisfied the requirement to sign a release of
claims.  The first payment on the Starting Date shall include those
payments that would have been previously paid if the payments of the severance
compensation had begun on the first payroll date following the date of
Executive’s Separation from Service.  The Company shall provide to
Executive a form of release of claims no later than three days following
Executive’s date of Separation from Service.  Executive must execute
and deliver the release of claims within 50 days after Executive’s date of
Separation from Service.  If Executive does not timely execute and
deliver to the Company such release, or if Executive 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 Executive.

     

    (d)    Delay for Specified
Employees.  If Executive 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
Executive’s Separation from Service and any amount that would be paid to
Executive 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 Executive until six months following Executive’s
Separation from Service.  On the first regular payroll date following
the expiration of such six-month period (or if Executive 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 Executive in a
single lump sum and thereafter all payments shall be made as if there had been
no such delay.  In addition, if Executive 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 Executive’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 Executive under Section 409A.  Neither the Company nor any
of its affiliates have any obligation to indemnify or otherwise hold Executive
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
Executive shall not disclose or use at any time, either during the Employment
Period or thereafter, any Confidential Information (as hereinafter defined) of
which the Executive is or becomes aware as a consequence of or in connection
with his employment with a 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 Executive’s performance in good faith of his duties as Chief Executive
Officer of the Company Entities or (ii) to the extent required by law or legal
process; provided that (A) the
Executive 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 Executive shall limit his disclosure only to the
Confidential Information that is expressly required to be disclosed by such law
or legal process.  The Executive will take all commercially reasonable
steps to safeguard Confidential Information and to protect it against
disclosure, misuse, espionage, loss and theft.  The Executive shall deliver
to the Company at the termination of the Employment Period, 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 Entities which the Executive may then possess or have under his
control.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    (b)    The
Executive agrees that all Work Product belongs in all instances to the Company
Entities.  The Executive 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 Entities’
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 Entities (whether during or
after the Employment Period), at the Companies’ 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 Executive 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 a Company Entity in connection with
its business, including, but not limited to, information, observations and data
obtained by the Executive 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 the Company Entities and their
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 Executive in violation of this Section 6, (B)
was provided to the Executive prior to the date hereof a nonconfidential basis
from a Person who was not otherwise bound by a confidentiality agreement or duty
with a Company Entity or an Affiliate thereof, or (C) becomes available to the
Executive on a nonconfidential basis from a Person who is not otherwise bound by
a confidentiality agreement or duty with a Company Entity or its Affiliates or
is not otherwise prohibited from transmitting the information to the
Executive.

     

    (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 a Company
Entity’s actual or anticipated business, research and development or existing or
future products or services and which are conceived, developed or made by the
Executive (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.

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    
      Section
7.    Non-Compete and
Non-Solicit.

    

     

    (a)    The
Executive acknowledges that, in the course of his employment with the Company
Entities, he has become familiar, or will become familiar, with the Company
Entities’ and their Affiliates’ trade secrets and with other confidential
information concerning the Company Entities and their Affiliates and that his
services have been and will be of special, unique and extraordinary value to the
Company Entities and their Affiliates.  Therefore, the Executive agrees
that, during the Employment Period and for 1 year thereafter (the “Restricted Period”),
he 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, long distance telephone business, cable
television, Internet access, or other business that the Company or any of its
Affiliates is engaged in during the Executive’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 Executive 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 Executive 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 the Company or any of its
Affiliates conducts or is pursuing or analyzing plans to conduct Company
Business as of the Termination Date.

     

    (b)    As a
means reasonably designed to protect Confidential Information, the Executive
agrees that, during the period commencing on the Effective Date and ending on
the expiration of the Restricted Period, he will not (i) solicit or make any
other contact with, directly or indirectly, any customer of a Company Entity or
any of their Affiliates as of the date that the Executive 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 the Company Entities or their Affiliates or (ii) solicit or make any
other contact with, directly or indirectly, any employee of a Company Entity or
any of their Affiliates on the date that the Executive ceases to be employed by
the Company (or any person who was employed by a Company Entity or any of their
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
Executive acknowledges that irreparable damage would occur in the event of a
breach of the provisions of Section 6 or
Section 7
by the Executive.  It is accordingly agreed that, in addition to any other
remedy to which its is entitled at law or in equity, the Company will be
entitled to an injunction or injunctions to prevent breaches of such sections of
this Agreement and to enforce specifically the terms and provisions of such
sections.

     

    
      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 each Company Entity (and each member
thereof), the term “Affiliate” will include, without limitation, each Person
with an ownership interest in a Company Entity (and each member, stockholder or
partner of each such Person), each Person in which the member of a Company
Entity (and member, stockholder or partner of each such Person) holds or has the
right to acquire, collectively, more than 25% of the voting equity
interests.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    “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.

     

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

     

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

     

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

     

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

     

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

     

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

     

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

     

    “Executive” 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).

     

    “Starting Date” has
the meaning set forth in Section
5(c).

     

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

     

    “Without Cause” 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.

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    (b)    Entire
Agreement.  This Agreement amends, restates and supersedes the Prior
Agreement and 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 Executive and
without the prior written consent of the Company shall not be assignable by the
Executive other than by will or the laws of descent and distribution.  This
Agreement shall inure to the benefit of and be enforceable by the Executive’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 OF THE PARTIES 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 Executive 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.

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    (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):

     

    
      	 	
              (a)

            	 
      	
              If
      to the Board or the Company, to:

            
	 	 
      	 
      	 
      
	 	 
      	
              Otelco
      Inc.

            	 
      
	 	 
      	
              505
      Third Avenue East

            	 
      
	 	 
      	
              Oneonta,
      Alabama 35121

            	 
      
	 	 
      	
              Attention:  Curtis
      L. Garner, Jr.

            	 
      
	 	 
      	
              Telephone
      No.:  (205) 625-3571

            	 
      
	 	 
      	
              Facsimile
      No.:  (205) 374-8999

            	 
      
	 	 
      	 
      	 
      	 
      
	 	
                

            	
              with
      a copy to:

            	 
      
	 	 
      	 
      	 
      
	 	 
      	
              Dorsey
      & Whitney LLP

            	 
      
	 	 
      	
              250
      Park Avenue

            	 
      
	 	 
      	
              New
      York, New York 10177

            	 
      
	 	 
      	
              Attention:  Steven
      Khadavi, Esq.

            	 
      
	 	 
      	
              Telephone
      No.:  (212) 415-9376

            	 
      
	 	 
      	
              Facsimile
      No.:  (212) 953-7201; and

            	 
      
	 	 
      	 
      	 
      
	 	
              (b)

            	 
      	
              if
      to the Executive to:

            
	 	 
      	 
      	 
      
	 	 
      	
              Michael
      Weaver

            	 
      
	 	 
      	
              900D
      Hammond Street

            	 
      
	 	 
      	
              Bangor,
      Maine 04401

            	 
      
	 	 
      	
              Telephone
      No.:  (207) 992-9925

            	 
      
	 	 
      	
              Facsimile
      No.:  (207) 992-9999

            	 
      


    

     

    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 5th
Business Day following the date on which the piece of mail containing such
communication is posted, if sent by mail.

     

    (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.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    (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]

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

     

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


     

    
      	 	
              OTELCO
      INC.

            	 
	 	 
      	 
      	 
	 	 
      	 
      	 
	 	
              By:

            	
              /s/
      Curtis L. Garner, Jr.

            	 
	 	 
      	
              Name: 
      Curtis L. Garner, Jr.

            	 
	 	 
      	
              Title: 
      Secretary

            	 
	 	 
      	 
      	 
	 	 
      	 
      	 
	 	 
      	 
      	 
	 	
              EXECUTIVE

            	 
	 	 
      	 
      	 
	 	 
      	 
      	 
	 	
              /s/
      Michael Weaver

            	 
	 	
              MICHAEL
      WEAVER