Document:

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                                                                    Exhibit 10.7
                              EMPLOYMENT AGREEMENT

      AGREEMENT made by and between US LEC Corp., 6801 Morrison Boulevard,
Morrocroft III, Charlotte, North Carolina 28211 ("US LEC") and Francis J. Jules,
Glencoe, Illinois, ("Employee").

      1. Employment and Duties. US LEC hereby agrees to employ Employee, and
Employee hereby accepts such employment and agrees to perform the duties
hereinafter set forth, effective as of December 18, 2001 (the "Employment
Date"). Employee shall serve as the Chief Executive Officer of US LEC,
responsible for the overall business and strategic planning and management
control of US LEC, and with the duties, responsibilities and authority normally
associated with the position of Chief Executive Officer, and as an officer of
any of US LEC's subsidiaries or affiliates as the same may exist from time to
time during the "Term" of this Agreement (as defined below) and shall be
appointed as a member of US LEC's Board of Directors (the "Board") and nominated
for reelection at each annual meeting of US LEC's shareholders during the Term
of this Agreement at which his term as a director is due to expire. For purposes
of this Agreement, "US LEC" shall mean US LEC Corp. and each of its subsidiaries
and/or affiliated entities as the same may exist from time to time during the
Term hereof. During the Term of this Agreement, Employee shall devote his entire
working time and attention to the business of US LEC, and shall perform his
duties in a diligent, effective and loyal manner.

      2. Signing Bonus/Compensation/Stock Options. US LEC shall compensate
Employee for all services to be rendered by him pursuant to this Agreement in
the following manner:

            (a) A signing bonus of $100,000 to be paid upon the signing of this
      Agreement.

            (b) A base salary of $500,000 per year, to be paid on a bi-weekly
      basis during the Term of this Agreement. The Board shall review at least
      annually, and may increase but not decrease, Employee's base salary, based
      upon the recommendations of its Executive Compensation Committee.

            (c) An annual incentive bonus for 2002 and each subsequent fiscal
      year of US LEC during the Term, in addition to Employee's base salary, the
      amount of which (up to 50% of Employee's base salary for the year ending
      December 31, 2002) shall be determined by the Board, in its discretion, on
      the recommendation of its Executive Compensation Committee.

            (d) Subject to approval by the Board, Employee shall be granted
      stock options to purchase an aggregate of 550,000 shares of Class A common
      stock of US LEC in accordance with US LEC's Omnibus Stock Option Plan, at
      an exercise price of $2.91 per share, under the following terms:

                  (i) Options for 100,000 shares to be vested and exercisable
            immediately on the Employment Date.

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                  (ii) Options for 150,000 shares to be vested and exercisable
            on each of the first, second and third anniversary dates of the
            Employment Date.

                  (iii) In the event of a "change of control" of US LEC (as such
            term is defined in US LEC's Omnibus Stock Option Plan), Employee
            will be entitled to immediate vesting of his stock options in
            accordance with the terms of such plan.

            (e) In the event the outstanding Class A common stock of US LEC is
      acquired for cash prior to December 31, 2002 at a per share price of
      between $5.00 and $5.64, and Employee's 550,000 options granted pursuant
      to Paragraph 2(d) above are being bought out for cash in the acquisition,
      Employee will receive a cash payment from US LEC equal to the amount by
      which $1,500,000 exceeds the product of 550,000 multiplied by the amount
      by which such per share price exceeds $2.91. For example, if US LEC is
      acquired for cash at a per share price of $5.25 prior to December 31,
      2002, and Employee's 550,000 options are being bought out for cash in the
      acquisition, Employee would be entitled to receive a cash payment from US
      LEC in the amount of $1,500,000-550,000*($5.25-$2.91)=$213,000.

      3. Benefits. Employee shall be entitled to receive the following benefits,
in each case subject to the applicable terms and conditions of US LEC's policies
and procedures governing such benefits and the reimbursement of expenses:

            (a) During the Term of this Agreement, four weeks of paid vacation
      per year, or such greater period as may be approved from time to time by
      the Board; customary health and disability insurance and other benefits
      made available from time to time by US LEC to its executive employees
      generally; use of a company-provided vehicle; and reimbursement of tax and
      personal financial counseling and planning fees not to exceed $10,000
      annually;

            (b) Reimbursement of reasonable, customarily accepted relocation
      costs, including brokerage fees and other closing costs on the sale of
      Employee's current principal residence and the purchase of a new principal
      residence in the Charlotte, North Carolina area, grossed up for applicable
      taxes;

            (c) Until the earlier of one year from the Employment Date or
      Employee's relocation to the Charlotte, North Carolina area (such
      relocation to occur as soon as is reasonably practical following the
      Employment Date), reimbursement for reasonable temporary housing costs in
      the Charlotte, North Carolina area together with reimbursement for coach
      class airfare and other reasonable travel expenses for Employee's weekly
      travel between his home in Glencoe, Illinois and Charlotte, North
      Carolina; and

            (d) Reimbursement for reasonable attorney fees in connection with
      the negotiation of this Agreement.

      4. Term. Unless terminated earlier pursuant to any of Paragraphs 5 through
9 or Paragraphs 11 or 12, this Agreement shall be effective for the period
commencing on the Employment Date and ending on December 31, 2004 (the "Initial
Term") and shall automatically renew for successive one year terms thereafter,
unless terminated by either party by giving ninety (90) days' prior written
notice to the other party of its intent to terminate this Agreement at the end

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of the Initial Term or any renewal term (the Initial Term, together with any
renewal terms, the "Term").

      5. Termination by US LEC for Cause. US LEC may terminate Employee's
employment hereunder "For Cause" during the Term hereof if:

            (a) Employee engages in conduct that constitutes a willful and
material breach of this Agreement, and US LEC:

            (i) Notifies Employee that Employee is deemed in material breach of
      this Agreement;

            (ii) Specifies the conduct that constitutes such a breach; and

            (iii) Demands that Employee cease or cure such breach within 30 days
      following receipt of such notice;

            such termination to be effective automatically if the breach is not
      cured within such 30 day cure period; or

            (b) Employee is convicted of a crime that constitutes a felony under
      North Carolina law, such termination to be effective immediately upon
      notice from US LEC; or

            (c) Any lawsuit, arbitration or other action or proceeding is
      brought against US LEC or Employee by a former employer of Employee (or
      any successor to any of the businesses or assets of any such former
      employer) arising out of or related to US LEC's employment of Employee or
      Employee's violation or breach or alleged violation or breach of any
      agreement or obligation with a former employer by virtue of his employment
      with US LEC or any conduct taken by him during his employment with US LEC,
      such termination to be effective upon ten (10) days advance notice to
      Employee.

      Should Employee be terminated For Cause, then effective as of the date of
termination, all unaccrued compensation and benefits to which Employee is
entitled hereunder shall terminate and Employee shall immediately resign from
the Board. In addition, if Employee is terminated For Cause pursuant to
subparagraph (c) above within one (1) year of the Employment Date, the options
granted to Employee pursuant to Paragraph 2(d) and all rights acquired by
Employee thereunder shall be rescinded (including the delivery to US LEC of any
shares of Class A common stock acquired by Employee upon the exercise thereof if
then owned by Employee or the payment to US LEC of the amount realized by
Employee upon the sale of such shares if not then owned by Employee, in each
case in exchange for the payment to Employee by US LEC of the exercise price
paid by Employee), and the provisions of Paragraph 2(e) (if applicable) shall be
rescinded. Further, if US LEC terminates Employee For Cause pursuant to
subparagraph (c) above within six (6) months of the Employment Date, Employee
shall also repay to US LEC the amount of the signing bonus paid to him pursuant
to Paragragh 2(a), net of all federal, state and local income and employment
taxes paid by Employee with respect to such signing bonus.

      6. Termination by US LEC Without Cause. Employee's employment hereunder
may be terminated during the Term hereof by US LEC at any time, without cause,
upon 30 days advance

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notice. In such event, Employee shall be entitled to receive the applicable
Termination Payments described in Paragraph 10 below, and Employee shall resign
from the Board effective immediately. A notice by US LEC to terminate this
Agreement at the end of any Term in accordance with Paragraph 4 above shall be
treated as a termination of Employee's employment by US LEC without cause.

      7. Termination by Employee Due to Change in Responsibilities. Employee may
elect, upon ten (10) days advance notice to US LEC, to terminate his employment
during the Term hereof if, in circumstances not involving a "Change of Control"
(as defined below), Employee is removed from or not retained as a member of the
Board or Employee makes a reasonable determination that the Board has
significantly reduced his responsibilities, duties and authority as contemplated
in Paragraph 1 hereof. If Employee terminates his employment pursuant to this
Paragraph 7, Employee shall be entitled to receive the applicable Termination
Payments described in Paragraph 10 below, and Employee shall resign from the
Board effective immediately.

      8. Termination by Employee Due to a Change of Control. Employee may elect,
upon ten (10) days advance notice to US LEC, to terminate his employment during
the Term hereof if, after a "Change of Control" of US LEC (as defined herein),
Employee is removed from or not retained as a member of the Board or makes a
reasonable determination that he is unable to exercise the authority,
responsibilities or duties contemplated in Paragraph 1 above. If Employee
terminates his employment pursuant to this Paragraph 8, Employee shall be
entitled to receive the applicable Termination Payments described in Paragraph
10 below, and Employee shall resign from the Board effective immediately.
"Change of Control" is defined in Schedule 1 attached hereto, which Schedule is
incorporated herein by reference.

      9. Termination by Employee Without Cause. Employee may elect, upon at
least 30 days advance notice, to terminate his employment during the Term hereof
for no reason. In such event, all unaccrued compensation and benefits to which
Employee may be entitled hereunder shall be terminated as of the effective date
of such termination and Employee shall resign from the Board effective
immediately. In addition, if Employee terminates his employment pursuant to this
Paragraph 9 within one (1) year of the Employment Date, the options granted to
Employee pursuant to Paragraph 2(d) and all rights acquired by Employee
thereunder shall be rescinded (including the delivery to US LEC of any shares of
Class A common stock acquired by Employee upon the exercise thereof if then
owned by Employee or the payment to US LEC of the amount realized by Employee
upon the sale of such shares if not then owned by Employee, in each case in
exchange for the payment to Employee by US LEC of the exercise price paid by
Employee), and the provisions of Paragraph 2(e) (if applicable) shall be
rescinded.

      10. Termination Payments.

            (a) In the event that Employee elects to terminate his employment
pursuant to Paragraph 8 hereof, or is terminated by US LEC under Paragraph 6
hereof after a Change of Control or within 90 days prior to a Change of Control,
Employee shall be paid an amount equal to his then-current annual base salary in
a lump sum within 30 days following the effective date of such a termination and
shall be provided the benefits described in subparagraph 10(c) below.

            (b) In the event that Employee is terminated by US LEC other than
For Cause (and other than in circumstances described in subparagraph 10(a)
above), or Employee elects to

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terminate his employment, in accordance with Paragraph 7 above, Employee shall
be paid his then-current base salary on a monthly basis for one year following
the effective date of either such event and shall be provided the benefits
described in subparagraph 10(d) below.

            (c) Should Employee become entitled to the payment described in
subparagraph 10(a) above, then Employee shall also be entitled to the following
payments and benefits:

            (i) The amount of any bonus determined by the Board to be awarded to
      Employee but unpaid as of the effective date of termination shall be paid
      in full to Employee within 30 days following the effective date of
      termination;

            (ii) On the effective date of any such event of termination, all
      stock options that shall have been granted to Employee through such date
      under US LEC's Omnibus Stock Option Plan shall be deemed vested and fully
      exercisable on such date, in accordance with the other terms of such plan;
      and

            (iii) All life insurance coverages as may be in effect on the
      effective date of any such event of termination shall continue to be
      provided to Employee for one year following the effective date of
      termination.

            (d) Should Employee become entitled to the payments described in
subparagraph 10(b) above, then Employee shall also be entitled to the following
payments and benefits:

            (i) The amount of any bonus determined by the Board to be awarded to
      Employee but unpaid as of the effective date of termination shall be paid
      in full to Employee within 30 days following the effective date of
      termination;

            (ii) On the effective date of any such event of termination, all
      stock options that shall have been granted to Employee and are vested as
      of such date under US LEC's Omnibus Stock Option Plan shall be deemed
      fully exercisable on such date, in accordance with the other terms of such
      plan; and

            (iii) All life insurance coverages as may be in effect on the
      effective date of any such event of termination shall continue to be
      provided to Employee for one year following the effective date of
      termination.

      11. Disability. If US LEC determines in good faith that the Disability of
Employee has occurred during the Term hereof (pursuant to the definition of
Disability set forth below), US LEC shall have the right to terminate this
Agreement upon ten (10) days advance notice to Employee. In such event, the
Employee shall be entitled to receive the payments and benefits provided under
Paragraph 2(b), Paragraph 2(c) (if awarded), Paragraph 2(e) (if applicable) and
Paragraph 3(a) of this Agreement (except the use of a company-provided vehicle)
for one year following the date on which he becomes disabled, less any payments
received by Employee under the terms of the disability insurance provided by US
LEC and covering Employee. For purposes of this Agreement, "Disability" shall
mean the absence of Employee from Employee's duties with US LEC on a full-time
basis for 180 consecutive days as a result of incapacity due to mental or
physical illness which is determined to be total and permanent by a physician
selected by US LEC or its insurers and

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acceptable to Employee or his legal representative (such agreement as to
acceptability not to be withheld unreasonably).

      12. Death. In the event that Employee shall die during the Term hereof,
this Agreement shall automatically terminate effective as of the date of
Employee's death without obligation of US LEC to pay or provide any unaccrued
compensation or benefits hereunder. Any payments or benefits accrued but unpaid
as of the date of Employee's death shall be payable to Employee's estate.

      13. Covenant Not to Compete. Employee recognizes and agrees that, in his
position as Chief Executive Officer, he will have contact with, or supervisory
authority over other US LEC employees who will have contact with, all customers
and prospective customers of US LEC, and further Employee will have access to
all US LEC confidential and proprietary information. Employee further recognizes
and agrees that US LEC's relationships with its customers are critical to US
LEC's continued success. Therefore, in consideration of his initial employment
with US LEC, the options granted to him, his employment for a stated term, and
other benefits provided to him by US LEC, each of which constitutes separate and
sufficient consideration for the provisions of this Paragraph 13, Employee
hereby covenants and agrees that, during the period of his employment by US LEC
and for one year following the effective date of Employee's termination of
employment, regardless of the date, cause or manner of such termination:

            (a) Employee will not, directly or indirectly, for himself or on
      behalf of any other person, firm, entity, partnership or corporation,
      solicit, call upon or approach any Customer of US LEC for the purpose of
      (i) soliciting business from such Customer, (ii) providing to such
      Customer any products or services which are the same as or similar to
      those provided to Customers by US LEC, or (iii) encouraging such Customer
      to limit, reduce or cease doing business with US LEC. For purposes of this
      subparagraph (a) of this Paragraph 13, "Customer" shall include all
      existing customers of US LEC on the effective date of Employee's
      termination and all customers contacted or solicited by US LEC or Employee
      within twelve (12) months prior to the effective date of Employee's
      termination.

            (b) Employee will not, for himself or on behalf of any other person,
      firm, partnership or corporation, directly or indirectly, seek to persuade
      any director, officer, contractor, agent or employee of US LEC to
      discontinue that individual's status or employment with US LEC in order to
      become employed in any activity similar to or competitive with the
      business of US LEC, nor will Employee solicit or retain any such person
      for such purpose.

            (c) Employee will not, directly or indirectly, alone or as an
      employee, independent contractor of any type, partner, officer, director,
      creditor, stockholder or holder of any option or right to become a
      stockholder in any entity or organization, within the Restricted Territory
      (as defined below) do any of the following:

                  (i) engage in any business pertaining to the sale,
            distribution, manufacture, marketing, production or provision of
            products or services in material competition with any products or
            services produced, designed, manufactured, sold, distributed or
            rendered, as the case may be, by US LEC (a "Competitive Business");

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                  (ii) advance credit, lend money, furnish quarters or give
            advice to any person, corporation or business entity of any kind
            (other than US LEC) which is engaged in any Competitive Business;

                  (iii) ship, provide or cause to be shipped or provided or have
            any part in the shipping or provision of products or services
            produced, designed, manufactured, sold, distributed or rendered, as
            the case may be, by US LEC to any point within the Restricted
            Territory for the purposes of resale;

            provided, however, that nothing contained in this subparagraph (c)
            shall prevent Employee from owning up to 5% of the equity interests
            in a company.

                  For purposes of this subparagraph (c), the term "Restricted
            Territory" shall mean:

            (i)   A sixty mile radius of the following: Philadelphia, Pa.;
                  Pittsburgh, Pa.; Baltimore, Md.; Washington, DC; Richmond,
                  Va.; Norfolk, Va.; Greensboro, NC; Raleigh, NC; Charlotte, NC;
                  Charleston, SC; Atlanta, Ga.; Jacksonville, Fla.; Orlando,
                  Fla.; Tampa, Fla.; Fort Myers, Fla; West Palm Beach, Fla.;
                  Miami, Fla.; New Orleans, La.; Mobile, Ala.; Birmingham, Ala.;
                  Memphis, Tenn.; Chattanooga, Tenn.; Nashville, Tenn.;
                  Knoxville, Kty.; Louisville, Kty;

            (ii)  A sixty mile radius of each city in which US LEC provides
                  telecommunication services, whether existing as of the date of
                  this Agreement or hereafter as a result of expansion,
                  acquisition or otherwise;

            (iii) Any geographical area in the States of North Carolina, South
                  Carolina, Florida, Virginia, Tennessee, Georgia, Alabama,
                  Pennsylvania, Louisiana, Kentucky, Maryland, and the District
                  of Columbia in which US LEC conducts material
                  telecommunications business;

            (iv)  Any geographical area in any additional States in the United
                  States in which US LEC conducts material telecommunications
                  business during the Term hereof, whether as a result of
                  expansion, acquisition or otherwise.

            (d) If any of the restrictions on competitive activities contained
      in this Paragraph 13 shall for any reason be held by a court of competent
      jurisdiction to be excessively broad as to duration, geographical scope,
      activity or subject, such restrictions shall be construed so as to be
      enforceable to the extent compatible with applicable law as it shall then
      exist; it being understood that by the execution of this Agreement the
      parties hereto regard such restrictions as reasonable and compatible with
      their respective rights and expectations.

      14. Trade Secrets and Confidential and Proprietary Information. Except as
may be required by his employment hereunder, Employee will not at any time or in
any manner, directly or

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indirectly, use, divulge, disclose or communicate to any person, firm,
corporation, organization or entity any trade secrets or confidential or
proprietary information of US LEC, including but not limited to information
concerning matters affecting or relating to the services, marketing, contractual
relationships, long range plans, products, processes, formulas, inventions,
discoveries, devices, or other business of US LEC or of its customers. Employee
will likewise hold inviolate and keep secret all knowledge or information
acquired by him concerning the names of US LEC's customers, their addresses, the
prices US LEC obtains or has obtained from them for its goods or services, all
knowledge or information acquired by him concerning the products, formulas,
processes, methods of manufacture and distribution and all other trade secrets
or confidential information regarding US LEC's customers. In addition, Employee
shall make no disclosure, directly or indirectly, of any financial information,
contractual relationships, policies, past or contemplated future actions or
policies of US LEC, personnel matters, marketing or sales data, technical data
or specifications and written or oral communications of any sort of US LEC or
any of its customers which have not previously been disclosed to the general
public with US LEC's consent or without first obtaining the consent of US LEC
for such disclosure. Upon the expiration or any termination of this Agreement or
of Employee's employment, Employee or his representatives shall immediately
deliver to US LEC all notes, notebooks, letters, papers, drawings, memos,
communications, blueprints and other property, documents, writings or data
relating to the business of US LEC or its customers.

      15. Injunctive Relief. Because Employee shall acquire by reason of his
employment and association with US LEC an extensive knowledge of US LEC's trade
secrets, customers, procedures, and other confidential and proprietary
information, the parties hereto recognize that in the event of a breach or
threat of breach by Employee of the terms and provisions contained in Paragraph
13 or 14, compensation alone to US LEC would not be an adequate remedy.
Therefore, it is agreed that in the event of a breach or threat of a breach of
the provisions of Paragraph 13 or 14 by Employee, US LEC shall be entitled, in
addition to provable damages, to an immediate injunction from any court of
competent jurisdiction restraining Employee from committing or continuing to
commit a breach of such provisions, without the showing or proving of actual
damages. Any preliminary injunction or restraining order shall continue in full
force and effect until any and all disputes between the parties relating to such
breach or threatened breach have been finally resolved by settlement or by a
court of law. Employee hereby waives any right he may have to require US LEC to
post a bond or other security with respect to seeking, obtaining, or continuing
any such injunction or temporary restraining order.

      16. Absence of Restrictions. Except as otherwise disclosed to US LEC,
Employee represents and warrants that he is not prevented or restricted from
entering into an employment relationship with US LEC by any agreement with or
obligation to any person, firm or entity or by any other disability or
restraint, including, but not limited to, the order, judgment or decree of any
court or governmental agency. Employee further agrees that during his employment
with US LEC:

            (a) Employee will not disclose to another US LEC employee or agent
any trade secrets or proprietary information belonging to Employee's former
employers, businesses or other person or entity that he is not specifically and
expressly permitted to disclose by that employer, business, person or entity;

            (b) Employee will not use or disclose in performing his duties as a
US LEC employee any trade secrets or proprietary information belonging to a
former employer, business or

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other person or entity that he is not specifically and expressly permitted to
use or disclose by that employer, business, person or entity; and

            (c) Employee will make sure that he has not retained any property
belonging to his former employers or businesses that he has not been given
specific permission to retain by the former employer or business.

      Employee also specifically acknowledges and agrees to adhere to US LEC's
policy encouraging all of its employees to comply with any legally binding
restrictive covenants they have in agreements with former employers or
businesses.

      17. General Terms

            (a) Binding Effect. This Agreement shall be binding upon and inure
to the benefit of the parties hereto, their personal representatives, and their
permitted successors and assigns.

            (b) Assignment. This Agreement may not be assigned, in whole or in
part, by either party hereto without the prior written consent of the other
party; provided that any successor to all or substantially all of the business
and/or assets of US LEC (whether direct or indirect, by purchase, merger,
consolidation or otherwise) will be required, without the consent of Employee,
to assume and agree to perform this Agreement in the same manner and to the same
extent that US LEC would have been required to perform if no such succession had
taken place.

            (c) Entire Agreement. This Agreement contains the entire
understanding between the parties hereto and supersedes any prior understanding,
memoranda or other written or oral agreements between them respecting the within
subject matter, including without limitation the offer letter from US LEC to
Employee dated October 2, 2001. There are no representations, agreements,
arrangements or understandings, oral or written, between the parties relating to
the subject matter of this Agreement which are not fully expressed herein.

            (d) Modifications; Waiver. Any modification or waiver of this
Agreement must be in writing and signed by both parties to be effective. No
waiver of any breach or condition of this Agreement shall be deemed to be a
waiver of any other or subsequent breach or condition, whether of like or
different nature. No course of dealing between the parties hereto will be deemed
effective to modify, amend or discharge any part of this Agreement or the rights
or obligations of either party hereunder.

            (e) Partial Invalidity. If any provision of this Agreement shall be
held invalid or unenforceable by competent authority, such provision shall be
construed so as to be enforceable to the maximum extent compatible with the law
as it shall then appear. The total invalidity or unenforceability of any
particular provision of this Agreement shall not affect the other provisions
hereof and this Agreement shall be construed in all respects as if such invalid
or unenforceable provision were omitted.

            (f) Notices. Any notice or other communication required or permitted
under this Agreement shall be in writing and shall be deemed to have been duly
given (i) upon hand delivery, (ii) on the third day following delivery to the
U.S. Postal Service as certified mail, return receipt

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requested and postage prepaid, or (iii) on the first day following delivery to a
nationally recognized United States overnight courier service, fee prepaid,
return receipt or other confirmation of delivery requested. Any such notice or
communication shall be delivered or directed to a party at its address set forth
below or at such other address as may be designated by a party in a notice given
to the other party in accordance with the provisions of this subparagraph.

                     Notice to US LEC shall be sent to:

                     US LEC Corp.
                     6801 Morrison Boulevard
                     Morrocroft III
                     Charlotte, NC 28211
                     Attn:  Secretary

                     Notice to Employee shall be sent to:

                     Francis J. Jules
                     at his last address filed with US LEC

                     With a copy to:

                     Mayer, Brown & Platt
                     190 South LaSalle Street
                     Chicago, IL  60603
                     Attn:  Herbert W. Krueger

            (g) Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of North Carolina pertaining
to contracts made and to be wholly performed within such state, without taking
into account conflicts of laws principles.

            (h) Arbitration. In the event that any disagreement or dispute
should arise between the parties hereto with respect to this Agreement, then
such disagreement or dispute shall be submitted to arbitration in Charlotte,
North Carolina in accordance with the rules then pertaining to the American
Arbitration Association with respect to commercial disputes; provided, however,
that this provision will not affect or limit US LEC's right to seek and obtain
temporary, preliminary and permanent injunctive relief for Employee's violation
of Sections 13 or 14 of this Agreement (or any part thereof) in a court of law.
Judgment upon any arbitration award may, after its rendering, be entered in any
court of competent jurisdiction by either party. After any demand for
arbitration pursuant to this Agreement and prior to any scheduled arbitration
date, either party to such arbitration proceedings shall be entitled to
discovery according to the provisions and within the time limits prescribed in
Rule 34 and Rule 26(c)of the North Carolina Rules of Civil Procedure with
respect to all materials and records in the possession of either party hereto,
or in the possession of others, which are relevant to the matter or matters to
be arbitrated.

            (i) Jurisdiction and Venue. In the event that any legal proceedings
are commenced in any court with respect to any matter arising under this
Agreement, the parties hereto specifically consent and agree that:

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                  (i) the courts of the State of North Carolina and/or the
            United States Federal Courts located in the State of North Carolina
            shall have exclusive jurisdiction over each of the parties hereto
            and over the subject matter of any such proceedings; and

                  (ii) the venue of any such action shall be in Mecklenburg
            County, North Carolina and/or the United States District Court for
            the Western District of North Carolina, Charlotte, North Carolina.

            (j) Effect of Termination. Unless otherwise specifically agreed in
writing, the terms of Paragraphs 13, 14, 15, 16 and 17 shall survive any
termination, cancellation, repudiation or rescission of this Agreement, and
under such circumstances US LEC or Employee, as the case may be, may continue to
enforce such terms as if this Agreement were otherwise in full force and effect.

            (k) Gender. Whenever the context may require, any pronoun used
herein shall include the corresponding masculine, feminine or neuter forms and
the singular of nouns, pronouns and verbs shall include the plural and vice
versa.

            (l) Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, and all of said
counterparts together shall constitute but one and the same instrument.

            (m) Headings. The headings contained in this Agreement are inserted
for convenience only and do not constitute a part of this Agreement.

      IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the 18th day of December, 2001.

                                       US LEC CORP.

                                       By: /s/ Richard T. Aab
                                           -------------------------------
                                       Title:   Chairman
                                             -----------------------------

                                       EMPLOYEE:

                                              /s/ Francis J. Jules
                                       -----------------------------------
                                       Francis J. Jules

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                                                                    Exhibit 10.7

                                   Schedule 1
                             To Employment Agreement

                                   Definitions

      For purposes of this Agreement, the following terms shall have the
meanings given below:

      "Exchange Act" means the Securities Exchange Act of 1934, as amended.

      "Person" means any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act).

      A Person shall be deemed to have "Beneficial Ownership" of any securities:

            (a) that such Person or any of such Person's affiliates or
      associates (as such terms are defined in Rule 12b-2 of the General Rules
      and Regulations under the Exchange Act) directly or indirectly owns; or

            (b) that such Person or any of such Person's affiliates or
      associates, directly or indirectly, has (i) the right to acquire (whether
      such right is exercisable immediately or only after the passage of time)
      pursuant to any agreement, arrangement or understanding, whether written
      or oral (other than customary agreements with and between underwriters and
      selling group members with respect to a bona fide public offering of
      securities), or upon the exercise of conversion rights, exchange rights,
      warrants, options, or other similar rights; (ii) the sole right or shared
      right to vote or dispose (including any such right pursuant to any
      agreement, arrangement or understanding, unless arising from a revocable
      proxy or consent given to such Person in response to a public proxy or
      consent solicitation made in accordance with the rules and regulations
      promulgated under the Exchange Act); or (iii) "beneficial ownership" (as
      determined pursuant to Rule 13d-3 of the General Rules and Regulations
      under the Exchange Act).

      The phrase "then outstanding," when used with reference to the Beneficial
Ownership of securities of a corporation by any Person, shall mean the number of
such securities then issued and outstanding together with the number of such
securities not then actually issued and outstanding of which such Person would
be deemed to have Beneficial Ownership hereunder.

      "Change of Control" means:

            (a) The acquisition by any Person of Beneficial Ownership of 50% or
      more of either (i) the then outstanding shares of common stock of US LEC
      (the "Outstanding Common Stock") or (ii) the combined voting power of the
      then outstanding voting securities of US LEC entitled to vote generally in
      the election of directors (the "Outstanding Voting Securities"); provided,
      however, that the following acquisitions shall not constitute a Change of
      Control: (A) any acquisition directly from US LEC, (B) any acquisition by
      US LEC, (C) any acquisition by an employee benefit plan (or related trust)
      sponsored or maintained by US LEC, (D) any acquisition by any corporation
      pursuant to a reorganization, merger or consolidation, if, following such
      reorganization, merger or

<PAGE>

      consolidation, the conditions described in clauses (i), (ii) and (iii) of
      subsection (c) of this definition of Change of Control are satisfied;

            (b) Individuals who, as of the date hereof, constitute US LEC's
      Board of Directors (the "Incumbent Board") cease for any reason to
      constitute at least a majority of US LEC's Board of Directors; provided,
      however, that any individual becoming a director subsequent to the date
      hereof whose election, or nomination for election by US LEC's
      shareholders, was approved by a vote of at least a majority of the
      directors then comprising the Incumbent Board shall be considered as
      though such individual were a member of the Incumbent Board, but
      excluding, for this purpose, any such individual whose initial assumption
      of office occurs as a result of either an actual or threatened election
      contest (as such terms are used in Rule 14a-11 of Regulation 14A
      promulgated under the Exchange Act) or other actual or threatened
      solicitation of proxies or consents by or on behalf of a Person other than
      US LEC's Board of Directors;

            (c) Completion by US LEC of a reorganization, merger or
      consolidation, in each case, unless, following such reorganization, merger
      or consolidation, (i) more than 50% of, respectively, the then outstanding
      shares of common stock of the corporation resulting from such
      reorganization, merger or consolidation and the combined voting power of
      the then outstanding voting securities of such corporation entitled to
      vote generally in the election of directors is then Beneficially Owned,
      directly or indirectly, by all or substantially all of the individuals and
      entities who were the Beneficial Owners, respectively, of the Outstanding
      Common Stock, and Outstanding Voting Securities immediately prior to such
      reorganization, merger or consolidation in substantially the same
      proportions as their ownership, immediately prior to such reorganization,
      merger or consolidation, of the Outstanding Common Stock and Outstanding
      Voting Securities, as the case may be, and (ii) at least a majority of the
      members of the board of directors of the corporation resulting from such
      reorganization, merger or consolidation were members of the Incumbent
      Board at the time of the execution of the initial agreement providing for
      such reorganization, merger or consolidation; or

            (d) Completion by US LEC of (i) a complete liquidation or
      dissolution of US LEC or (ii) the sale or other disposition of all or
      substantially all of the assets of US LEC, other than to a corporation,
      with respect to which following such sale or other disposition, (A) more
      than 50% of, respectively, the then outstanding shares of common stock of
      such corporation and the combined voting power of the then outstanding
      voting securities of such corporation entitled to vote generally in the
      election of directors is then Beneficially Owned, directly or indirectly,
      by all or substantially all of the individuals and entities who were the
      Beneficial Owners, respectively, of the Outstanding Common Stock and
      Outstanding Voting Securities immediately prior to such sale or other
      disposition in substantially the same proportion as their ownership,
      immediately prior to such sale or other disposition, of the Outstanding
      Common Stock and Outstanding Voting Securities, as the case may be, and
      (B) at least a majority of the members of the board of directors of such
      corporation were members of the Incumbent Board at the time of the
      execution of the initial agreement or action of the Board providing for
      such sale or other disposition of assets of US LEC.

                                       2<PAGE>

                                                                    Exhibit 10.8

                              CONSULTING AGREEMENT

      THIS CONSULTING AGREEMENT (the "Agreement") is made and entered into as of
the 7th day of February, 2002 by and between US LEC Corp., a Delaware
corporation with its principal office located in Charlotte, North Carolina, on
behalf of itself and its affiliates (collectively "US LEC"), and TANSUKH V.
GANATRA, a resident of North Carolina ("Ganatra") to be retroactively effective
as of January 1, 2002 (the "Effective Date").

      WHEREAS, US LEC has identified a need for Ganatra to provide, during the
time period specified below, consulting services regarding US LEC's business;

      WHEREAS, Ganatra has specialized knowledge and experience that qualify him
to provide the advice and consulting services required by US LEC he is a founder
and has served as both Chief Executive Officer and as a director of US LEC, and
Ganatra, and at the time of the signing of this Agreement continues to be a
direct or indirect owner of 14.4% of US LEC's outstanding common stock; and

      WHEREAS, Ganatra and US LEC desire for Ganatra, beginning on the Effective
Date, to provide consulting services, to receive a monthly payment for such
consulting services, as well as additional compensation for consulting services
in excess of a specified number of hours each month, and to be restricted in his
ability to use confidential information and knowledge about US LEC and its
business in competition with US LEC pursuant to this Agreement, as specified in
the terms and conditions set forth below;

      NOW, THEREFORE, for and in consideration of the mutual promises,
covenants, obligations and rights hereinafter specified, US LEC and Ganatra
mutually agree as follows:

      1. Consulting Services. Beginning of the Effective Date, Ganatra shall
provide consulting services to US LEC as requested by US LEC to further US LEC's
business, including, but not limited to providing advice and assistance with
respect to (a) the conduct of US LEC's business, (b) strategic business issues
related to competitive conditions in the telecommunications industry, (c)
strategies and plans for new business development, (d) development and
implementation of network systems, (e) relationships with other
telecommunications carriers, and (f) evaluation of and assistance with potential
future acquisitions.

            (a) All consulting services provided by Ganatra to US LEC will be
      provided to US LEC's Board of Directors (the "Board") or such executive
      officers of US LEC as the Board may designate from time to time.

            (b) Ganatra agrees to provide up to twenty (20) days of consulting
      services each year during the Term of this Agreement (as defined below)
      for which he shall receive the compensation set forth in subsection 2(a)
      of this Agreement. Eight (8) hours of consulting services provided by
      Ganatra, whether provided in one (1) day or more than one day, shall be
      deemed one day of consulting services.

<PAGE>

            (c) At the request of the Board, Ganatra also agrees to provide
      consulting services in excess of twenty (20) days each year during the
      Term of this Agreement for which he shall receive the compensation set
      forth in Paragraph 2(b) of this Agreement.

            (d) At no time may US LEC request Ganatra to provide more than four
      (4) days of consulting services in any one-month period during each year.
      However, Ganatra may waive this maximum limitation on a month-to-month
      basis.

            (e) If the twenty (20) days of consulting services provided for in
      Paragraph 1(b) are not used by US LEC in any year, they shall not be
      accrued for future use in subsequent years.

      2. Compensation. The compensation payable by US LEC to Ganatra pursuant to
this Agreement shall be as follows:

            (a) For the services he has agreed to provide pursuant to Paragraph
      1(b) above, Ganatra shall receive compensation at the rate of $50,000 per
      year, paid in biweekly installments in accordance with US LEC's automatic
      deposit payroll practices.

            (b) For the services performed by Ganatra pursuant to Paragraph 1(c)
      above, Ganatra shall receive $500 per hour for each hour of service in
      excess of twenty (20) days per year. Ganatra shall submit to US LEC,
      monthly or quarterly, a reasonably itemized statement of the services he
      performs for the compensation payable to him pursuant to this Paragraph
      2(b). Any such statements shall be paid within thirty (30) days of by US
      LEC.

      3. Expenses. US LEC will reimburse Ganatra for all reasonable
out-of-pocket expenses incurred in performing his consulting duties that are
approved in advance or are otherwise reimbursable under applicable US LEC
policies and procedures, including reimbursement for the annual cost (estimated
at $1,000) of a ISDN line installed at Ganatra's home in Charlotte, North
Carolina. Such reimbursement will be due within thirty (30) days of presentation
to US LEC by Ganatra of a request for reimbursement with appropriate consistent
with Internal Revenue Service requirements. Ganatra will render periodic
statements to US LEC accounting for all expenses.

      4. Independent Contractor. The parties agree that Ganatra shall perform
his duties and services as an independent contractor. Ganatra shall be
responsible to US LEC only for his ultimate work product, and US LEC shall
neither have nor exercise any direction over the method or manner by which
Ganatra performs his services and functions under this Consulting Agreement.
Ganatra agrees, as an independent contractor, to be fully and completely
responsible for his appropriate self-employment tax payments as well as any
other required federal, state or local tax payments, and shall indemnify and
hold harmless US LEC, its officers, directors and employees from any liability,
costs or expenses incurred by reason of Ganatra's failure to report and/or pay
any such taxes. It is further agreed and understood that Ganatra is not covered
by any of the fringe benefit programs of US LEC, nor is he covered by workers'
compensation inasmuch as he is not an employee of

<PAGE>

US LEC; provided that Ganatra shall be entitled to COBRA benefits in accordance
with applicable law.

      5. Term and Termination. Unless terminated sooner as provided in this
Paragraph 5, the term of this Agreement shall be for seven (7) years, beginning
on the Effective Date and shall continue for seven (7) years thereafter (the
"Term").

            (a) After the third anniversary of the date this Agreement, Ganatra
      shall have the right to discontinue providing services under this
      Agreement by providing written notice to US LEC (addressed and delivered
      to the Board). In the event that Ganatra elects to discontinue providing
      services under this Agreement, he will no longer be entitled to receive
      the compensation specified in Paragraph 2. However, Ganatra will remain
      obligated to comply with the restrictive provisions contained in Paragraph
      9 from the effective date of his election to discontinue his consulting
      services, regardless of the fact that he is no longer providing consulting
      services to US LEC or receiving biweekly or other compensation from US
      LEC.

            (b) US LEC will have the right to terminate this Agreement only
      under the following circumstances: (1) Ganatra's disability, if such
      disability has rendered Ganatra unable to satisfactorily perform the
      services that may be requested of him under this Agreement; or (2)
      Ganatra's breach of this Agreement.

            (c) In the event US LEC terminates Ganatra's consulting services by
      reason of Ganatra's disability or breach of this Agreement, Ganatra shall
      no longer be entitled to receive biweekly or other compensation from US
      LEC, but he shall remain obligated to comply with the restrictive
      provisions contained in Paragraph 9 from the date of such termination,
      regardless of fact that he is no longer providing consulting services to
      US LEC or receiving biweekly or other compensation from US LEC. US LEC's
      termination of this Agreement under this provision will in no way preclude
      or limit its right to pursue any other remedies allowed by law, including
      but not limited to damages and injunctive relief.

            (d) Upon Ganatra's death, this Agreement shall automatically
      terminate and Ganatra's estate shall be entitled to receive only the
      amount of accrued but unpaid biweekly or other compensation specified in
      Paragraph 2 through the date of Ganatra's death and any unpaid expenses
      incurred by Ganatra pursuant to Paragraph 3 prior to his death. Ganatra's
      legal representative is authorized to make application for and receive on
      behalf of Ganatra's estate payments for any such compensation and
      expenses.

      6. Recognition of US LEC's Legitimate Interests. Ganatra understands and
acknowledges that US LEC and its affiliates compete in the United States in the
provision and sale of telecommunications products and services, including but
not limited to providing local, long distance, calling card, toll free,
dedicated internet, digital private line, and frame relay services to customers.
As part of Ganatra's prior employment with US LEC and in order for Ganatra to
render consulting services to US LEC, Ganatra has been and will continue to be
provided significant Confidential Information by US LEC (as defined below). In
addition, Ganatra may have direct contact with US LEC's customers, employees,
vendors, and

<PAGE>

representatives of companies US LEC considers for acquisition. Ganatra
acknowledges that US LEC's competitors would obtain an unfair advantage if
Ganatra disclosed the Confidential Information to a competitor, used it in a
competitor's behalf, or if he were able to exploit the relationships he
developed as an employee and consultant of US LEC to solicit business on behalf
of a competitor.

      7. Definition of Confidential Information. As used in this Agreement,
"Confidential Information" means data or information which is of value to US LEC
and is not generally known to persons or entities outside of US LEC, including
but not limited to the following: (a) information about past, present or
potential customers; (b) information about past, present, or potential vendors
or suppliers; (c) information about other carriers with whom US LEC does
business; (d) network planning techniques and processes, past, present or
proposed network designs or configurations, network diagrams, trunking
arrangements, switch configurations, or other network information; (e)
information about the financial aspects of US LEC's business, such as costs,
financial statements, pricing, quoting procedures, sales, financial projections,
and other financial information; (f) business opportunities for new or
developing business for US LEC, and business and marketing plans, techniques,
and strategies of US LEC (including plans for new markets, products or
services); (g) technical information including training materials, inventions,
computer programs, techniques and network engineering concepts; (h) employee
lists, organizational charts, and private personnel information; (i) any
information received by US LEC from third parties in confidence (or subject to
non-disclosure or similar covenants) and the terms and conditions of
negotiations or confidential contracts between US LEC and third parties; (j)
information concerning any potential mergers or acquisitions of or by US LEC or
other business opportunities; (k) any documents, designs, files or other
information marked "Confidential"; and (l) any other information that is
proprietary to US LEC or constitutes a trade secret under applicable law.

      8. Agreement to Maintain Confidentiality.

            (a) Except as otherwise provided in this Agreement, during the Term
      and at all times after the termination of this Agreement, Ganatra
      covenants and agrees to treat as confidential and not to negligently or
      intentionally disclose, and to use only for the advancement of the
      interests of US LEC, all Confidential Information received by Ganatra
      prior to this Agreement or received, compiled, developed, designed,
      produced, accessed, or otherwise discovered by Ganatra while providing
      consulting services to US LEC. Ganatra will not disclose or divulge the
      Confidential Information to any person, entity, firm or company whatsoever
      or use the Confidential Information for Ganatra's own benefit or for the
      benefit of any person, entity, firm or company other than US LEC.

            (b) Ganatra specifically acknowledges that the Confidential
      Information, whether reduced to writing or maintained in the mind or
      memory of Ganatra, and whether compiled or created by Ganatra, US LEC, or
      any of its affiliates or customers, derives independent economic value
      from not being readily known to or ascertainable by proper means by others
      who could obtain economic value from the disclosure or use of the
      Confidential Information. Ganatra also acknowledges that reasonable
      efforts have been

<PAGE>

      put forth by US LEC to maintain the secrecy of the Confidential
      Information, that the Confidential Information is and will remain the sole
      property of US LEC or any of its affiliates or customers, as the case may
      be, and that any retention and/or use of Confidential Information during
      or after the termination of this Agreement (except in the regular course
      of Ganatra performing his services hereunder) will constitute a
      misappropriation of the Confidential Information belonging to US LEC.

            (c) For purposes of this Paragraph, information shall not be deemed
      to be "Confidential Information" to the extent that the information (i) is
      in the public domain; or hereafter becomes generally known or available
      through no action or omission on the part of Ganatra; (ii) is furnished to
      any person by US LEC without restriction on disclosure; (iii) becomes
      known to Ganatra from a source other than US LEC, without a breach of any
      agreement with US LEC and without any restriction on disclosure; or (iv)
      is disclosed after written approval for the disclosure has been given by
      US LEC.

      9. Noncompetition and Nonsolicitation.

            (a) Ganatra hereby agrees that for so long as he is compensated for
      consulting services pursuant to this Agreement and for one (1) year from
      the effective date of his election to discontinue providing consulting
      services pursuant to Paragraph 5(a) or one (1) year from the date from the
      date US LEC terminates Ganatra's consulting services pursuant to Paragraph
      5(c), whichever becomes applicable, Ganatra will NOT, within the
      Restricted Territory, do any of the following:

                  (1) Engage directly or indirectly (either as an owner,
            employee, consultant, or in any similar capacity) in the research,
            development, marketing, sale, or distribution of telecommunications
            products or services which are the same as or similar to those in
            development and/or sold by US LEC while Ganatra is compensated for
            consulting services pursuant to this Agreement or the last twelve
            (12) months of Ganatra's employment with US LEC.

                  (2) Solicit or encourage any customers of US LEC (a) with whom
            Ganatra had direct contact while he is compensated for consulting
            services pursuant to this Agreement or while he was employed with US
            LEC, and (b) who remain US LEC customers at the time of
            solicitation, to purchase telecommunications products or services
            from any entity other than US LEC.

            (b) Ganatra agrees that for so long as he is compensated for
      consulting services pursuant to this Agreement and for two (2) years from
      the effective date of his election to discontinue providing consulting
      services pursuant to Paragraph 5(a) or two (2) years from the date US LEC
      terminates Ganatra's consulting services pursuant to Paragraph 5(c),
      whichever becomes applicable, Ganatra will NOT, within the Restricted
      Territory, encourage, induce or attempt to induce any employees of US LEC
      to end their employment relationship with US LEC and work for a competitor
      of US LEC.

<PAGE>

            (c) As used in this Paragraph 9, "Restricted Territory" shall mean
      the following:

                  1. A sixty mile radius of the following: Philadelphia, Pa.;
            Pittsburgh, Pa.: Baltimore, Md.; Washington, DC; Richmond, Va.;
            Norfolk, Va.; Greensboro, NC; Raleigh, NC; Charlotte, NC;
            Charleston, SC; Atlanta, Ga.; Jacksonville, Fla.; Orlando, Fla.;
            Tampa, Fla.; Fort Myers, Fla.; West Palm Beach, Fla.; Miami, Fla.;
            New Orleans, La.; Mobile, Ala.; Birmingham, Ala.; Memphis, Tenn.;
            Chattanooga, Tenn.; Nashville, Tenn.; Knoxville, Kty.; Louisville,
            Kty.;

                  2. A sixty mile radius of each city in which US LEC provides
            telecommunication services, whether existing as of the date of this
            Agreement or thereafter as a result of expansion, acquisition or
            otherwise;

                  3. Any geographical area in the States of North Carolina,
            South Carolina, Florida, Virginia, Tennessee, Georgia, Alabama,
            Pennsylvania, Louisiana, Kentucky, Maryland, and the District of
            Columbia in which US LEC conducts material telecommunications
            business;

                  4. Any geographical area in any additional States in the
            United States in which US LEC provides telecommunications products
            and/or services to customers during the Term hereof, whether as a
            result of expansion, acquisition or otherwise;

                  5. Any geographical area in any province of Canada in which US
            LEC provides telecommunications products and/or services to
            customers during the Term hereof;

                  6. Any geographical area in any State in the United States and
            province of Canada in which US LEC's customers are located.

      10. Return of Property. Ganatra agrees that upon (a) the termination of
this Agreement, or (b) the written request of US LEC, Ganatra (or in the event
of the death or disability of Ganatra, Ganatra's heirs, successors, assigns and
legal representatives) shall return to US LEC any and all property of US LEC,
including but not limited to all Confidential Information, notes, data,
reference items, documents, sketches, drawings, software, forms, manuals, and
equipment, without retaining any copies or summaries of such property.

      11. Enforcement. In addition to the rights specified in Paragraph 5, US
LEC will have all of the following remedies in the event of a breach by Ganatra
of this Agreement:

            (a) US LEC may enforce the provisions of this Agreement by
      injunction to (i) restrain any violation by Ganatra, Ganatra's partners,
      agents, servants, employers, and employees, and all persons acting for or
      with Ganatra; and (ii) to compel specific performance of the terms and
      conditions of this Agreement. Ganatra agrees that a breach or violation of
      any of the covenants under Paragraphs 7 through 10 will result in
      immediate

<PAGE>

      and irreparable harm to US LEC in an amount which will be impossible to
      ascertain at the time of the breach or violation and that the award of
      monetary damages will not be adequate relief to US LEC.

            (b) In the event that Ganatra fails to fulfill the terms of the
      consulting obligations contained in Paragraph 1 or fails to comply with
      the restrictive provisions contained in Paragraphs 7 through 10, US LEC
      may, at its discretion, declare the biweekly payments forfeited with
      respect to any biweekly period during which Ganatra is in breach of this
      Agreement. US LEC may declare the biweekly payment forfeited if Ganatra is
      in breach of this Agreement for any portion of the biweekly period at
      issue, and Ganatra will not be entitled to any payment for that period. US
      LEC may take this action without terminating the Agreement pursuant to
      Paragraph 5.

            (c) The remedies described in Subparagraphs (a) and (b) of this
      Paragraph shall be cumulative and in addition to all other remedies US LEC
      may have against Ganatra at law or in equity. Further, the rights provided
      by Subparagraph (b) of this Paragraph shall not be interpreted in any way
      to limit US LEC's right to seek and obtain injunctive relief. Finally,
      nothing contained in this Agreement shall limit, abridge, or modify the
      rights of US LEC under any statutes or common law, including but not
      limited to applicable trade secret, trademark, copyright, or patent law.

      12. Reasonableness of Restrictions. Ganatra has carefully considered the
nature and extent of the restrictions upon him and the rights and remedies
conferred upon US LEC under Paragraphs 7 through 10 and hereby acknowledges and
agrees that the same are reasonable in time and territory, are designed to
eliminate competition which would otherwise be unfair to US LEC, do not
interfere with Ganatra's exercise of his inherent skill and experience, are
reasonably required to protect the legitimate interests of US LEC, and do not
confer a benefit upon US LEC disproportionate to the detriment to Ganatra.
Ganatra certifies that he has had the opportunity to discuss this Agreement with
such legal advisors as he chooses and that he understands its provisions and has
entered into this Agreement freely and voluntarily. US LEC agrees to pay or
reimburse Ganatra for the reasonable fees and out-of-pocket expenses of his
counsel for reviewing and advising Ganatra regarding the terms of this
Agreement.

      13. Severability. It is the intention of the parties to restrict the
activities of Ganatra only to the extent reasonably necessary for the protection
of US LEC's legitimate interests. The parties specifically covenant and agree
that should any of the provisions in this Agreement be deemed by a court of
competent jurisdiction too broad for the protection of US LEC's legitimate
interests, the parties authorize the court to narrow, limit or modify the
restrictions herein to the extent reasonably necessary to accomplish such
purpose. In the event such limiting construction is impossible, such invalid or
unenforceable provision shall be deemed severed from this Agreement and every
other provision of this Agreement shall remain in full force and effect.

      14. Applicable Law. This Agreement shall be interpreted, construed and
governed according to the laws of the State of North Carolina, regardless of
choice of law principles to the contrary. Further, US LEC and Ganatra agree that
in any dispute between them jurisdiction and venue are appropriate in
Mecklenburg County, North Carolina.

<PAGE>

      15. Entire Agreement; Amendments. With the exception of any
Confidentiality Agreement previously entered into between US LEC and Ganatra,
this Agreement discharges and cancels all previous agreements and constitutes
the entire agreement between the parties with regard to the subject matter
hereof. No agreements, representations, or statements of any party not contained
herein shall be binding on either party. Further, no amendment or variation of
the terms or conditions of this Agreement shall be valid unless in writing and
signed by both parties.

      16. Assignability. This Agreement and the rights and duties created
hereunder shall not be assignable or delegable by Ganatra. US LEC may, at its
option and without the consent of Ganatra, assign its rights and duties
hereunder to any successor to US LEC or transferee of all or substantially all
of US LEC's assets. Any such successor or transferee shall be bound by this
Agreement in the same manner and to the same extent as US LEC as if no such
succession or transfer had taken place.

      17. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of US LEC and Ganatra and their respective successors, assigns, heirs
and legal representatives.

      18. No Waiver. No failure or delay by any party to this Agreement to
enforce any right specified in this Agreement will operate as a waiver of such
right, nor will any single or partial exercise of a right preclude any further
or later enforcement of the right within the period of the applicable statute of
limitations.

      19. Affiliates. Ganatra and US LEC acknowledge and agree that all
affiliates of US LEC are specific, intended parties to this Agreement, and that
each shall be independently entitled to enforce US LEC's rights and benefits
under this Agreement against Ganatra.

      IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first written above.

                                           US LEC CORP.

                                           By: /s/ Francis J. Jules
                                               ---------------------------------
                                           Its: Chief Executive Officer
                                               ---------------------------------

                                           /s/ Tansukh V. Ganatra
                                           -------------------------------------
                                           Tansukh V. Ganatra

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