Document:

Amendment and Form of OceanFirst Bank Employee Severance Compensation Plan

 Exhibit 10.18 
  
 AMENDMENT TO THE 
 OCEAN FEDERAL SAVINGS BANK EMPLOYEE SEVERANCE 
 COMPENSATION PLAN 
  
 This Amendment to the Ocean Federal Savings Bank Employee Severance
Compensation Plan the (“Plan”), is executed on July 20, 2005, by the Board of Directors of OceanFirst Bank, formerly Ocean Federal Savings Bank (the “Bank”). 
  
 WHEREAS, on July 17, 1996 the Bank adopted the Ocean Federal Savings Bank Employee Severance Plan; and 
  
 WHEREAS, as authorized under Article VIII of the Plan, the Board of
Directors of the Bank feels it would be in the best interest of the Bank to amend the Plan to make certain changes regarding Participant eligibility and vesting requirements; and 
  
 WHEREAS, with certain exceptions not applicable here, pursuant to Article VIII the Plan may be amended in any respect
by resolution adopted by the majority of the Board of Directors of the Bank. 
  
 NOW THEREFORE, the Ocean Federal Savings Bank Employee Severance Compensation Plan is hereby amended as follows: 
  
 1. The name of the Plan is hereby amended to read “The OceanFirst Bank Employee Severance Compensation Plan” and all references to Ocean Federal
Savings Bank are deleted and substituted with the name “OceanFirst Bank”; 
  
 Section 3.1, “Participation,” the following words are added at the beginning of the section “Except as noted in Section 4.3,...” 
  
 Section 4.3(a)(i) is amended to read as follows: 
  
 “(i) Participants with a title of ‘Vice President’ or greater shall receive a Payment equal
to one full year’s salary (determined immediately prior to the time the Payment is to be made) regardless of length of service.” 
  
 Existing Section 4.3(a)(ii) is made new Section 4.3(a)(iii) and the following language is substituted for new Section 4.3(a)(ii): 
  
 “(ii) Participants with a title of ‘Assistant Vice President’
shall receive a Payment equal to one half of their Annual Compensation regardless of length of service. Assistant Vice Presidents shall also receive a Payment equal to one twelfth (1/12) of their Annual Compensation for each full year of service
after their sixth anniversary of employment with the Bank up to an additional one half of their Annual Compensation. Total payments under this Section shall not exceed a maximum of 100% of Annual Compensation.” 
  
 IN WITNESS WHEREOF, the Bank adopted this Amendment to the Ocean
Federal Savings Bank Employee Severance Compensation Plan and caused this instrument to be executed by its duly authorized officers as of the date above. 
  

					
	 ATTEST:
  
  

	 	 	 	 OCEANFIRST BANK
  

 

	 Secretary
	 	 	 	 For the entire Board of Directors

 OCEAN FEDERAL SAVINGS BANK 
 EMPLOYEE SEVERANCE COMPENSATION PLAN 
  
 PLAN PURPOSE 
  
 The purpose of the Ocean Federal Savings Bank Employee Severance Compensation Plan is to assure for Ocean Federal Savings Bank (the “Bank”) the services of Employees of the Bank in the event of a Change in Control (capitalized
terms are defined in section 2.1) of Ocean Financial Corp. (the “Holding Company”) or the Bank. The benefits contemplated by the Plan recognize the value to the Bank of the services and contributions of the Employees of the Bank and the
effect upon the Bank resulting from the uncertainties of continued employment, reduced Employee benefits, management changes and relocations that may arise in the event of a Change in Control of the Bank or the Holding Company. The Bank’s and
the Holding Company’s Boards of Directors believe that it is in the best interests of the Bank and the Holding Company to provide Employees of the Bank who have been with the Bank for a minimum of one year with such benefits in order to defray
the costs and changes in Employee status that could follow a Change in Control. The Board of Directors believes that the Plan will also aid the Bank in attracting and retaining highly qualified individuals who are essential to its success and the
Plan’s assurance of fair treatment of the Bank’s Employees will reduce the distractions and other adverse effects on Employees’ performance in the event of a Change in Control. 
  
 ARTICLE I 
 ESTABLISHMENT OF PLAN 
  
 1.1 Establishment of Plan 
  
 As of the Effective Date of the Plan as defined herein, the Bank hereby establishes an employee severance compensation plan to be known as the “Ocean Federal Savings Bank Employee Severance Compensation Plan.” The purposes of the
Plan are as set forth above. 
  
 1.2 Applicability of Plan

  
 The benefits provided by this Plan shall be available to all
Employees of the Bank, who, at or after the Effective Date, meet the eligibility requirements of Article III, except for those executive officers who have entered into, or who enter into in the future, and continue to be subject to an employment or
change in control agreement with the Employer. 
  
 1.3
Contractual Right to Benefits 
  
 This Plan establishes in
each Participant a contractual right in consideration for meeting the eligibility requirements of the Plan, to the benefits to which each Participant is entitled hereunder, enforceable by the Participant against the Employer, Bank, or both.

  
 ARTICLE II 
 DEFINITIONS AND CONSTRUCTION 
  
 2.1 Definitions 
  
 Whenever used in the Plan, the following terms shall have the meanings set forth below. 
  
 (a) “Annual Compensation” of a Participant means and includes only regular wages, and salary during the most
recent 12 months ended the date as of which Annual Compensation is to be determined, which are or would be includable in the gross income of the Participant receiving the same for federal income tax purposes. 
  
 (b) “Bank” means Ocean Federal Savings Bank or any successor as
provided for in Article VII hereof. 
  
 (c) “Change in
Control” of the Bank or Holding Company shall mean an event of a nature that; (i) would be required to be reported in response to Item 1 of the current report on Form 8-K, as in effect on the date hereof, pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 (the “Exchange Act”); or (ii) results in a Change in Control of the Bank or the Holding Company within the meaning of the Home Owners’ Loan Act of 1933, as amended, and the Rules and Regulations
promulgated by the Office of Thrift Supervision (the “OTS”) (or its predecessor agency), as in effect on 

 the date hereof (provided, that in applying the definition of change in control as set forth under the Rules and
Regulations of the OTS, the Board shall substitute its judgment for that of the OTS); or (iii) without limitation such a Change in Control shall be deemed to have occurred at such time as (A) any “person” (as the term is used in Sections
13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Bank or the Holding Company representing 20% or more of the
Bank’s or the Holding Company’s outstanding securities except for any securities of the Bank purchased by the Holding Company in connection with the conversion of the Bank to the stock form and any securities purchased by any tax-qualified
employee benefit plan of the Bank; or (B) individuals who constitute the Board on the date hereof (the “Incumbent Board”) cease for any reason to constitute at least a majority thereof, provided that any person becoming a director
subsequent to the date hereof whose election was approved by a vote of at least three-quarters of the directors comprising the Incumbent Board, or whose nomination for election by the Holding Company’s stockholders was approved by the same
Nominating Committee serving under an Incumbent Board, shall be, for purposes of this clause (B), considered as though he were a member of the Incumbent Board; or (C) a plan of reorganization, merger, consolidation, sale of all or substantially all
the assets of the Bank or the Company or similar transaction occurs in which the Bank or Holding Company is not the resulting entity; provided, however, that such an event listed above will be deemed to have occurred or to have been effectuated upon
the receipt of all required regulatory approvals not including the lapse of any statutory waiting periods; or (D) solicitations of shareholders of the Holding Company, by someone other than the current management of the Holding Company, seeking
stockholder approval of a plan of reorganization, merger or consolidation of the Holding Company or Bank or similar transaction with one or more corporations as a result of which the outstanding shares of the class of securities then subject to the
plan or transaction are exchanged for or converted into cash or property or securities not issued by the Bank or the Holding Company shall be distributed; or (E) a tender offer is made for 20% or more of the voting securities of the Bank or the
Holding Company. 
  
 (d) “Disability” as it regards a
particular Participant has the same meaning as in any long term disability plan (“LTD Plan”) maintained by the Bank by which such Participant is covered, in the absence of such a LTD Plan, “Disability” means the permanent and
total inability by reason of mental or physical infirmity, or both, of an employee to perform the work customarily assigned to him. Additionally, a medical doctor selected or approved by the Board of Directors must advise the Board that it is either
not possible to determine if or when such Disability will terminate or that it appears probable that such Disability will be permanent during the remainder of said employees lifetime. 
  
 (e) “Disqualified Individual” means an individual who is an employee or independent contractor of the corporation
and is, with respect to the corporation, (i) a shareholder, (ii) an officer, or (iii) a highly compensated individual, as all of these terms, including Disqualified Individual, are defined under Section 280G or the Code. 
  
 (f) “Effective Date” means the date the Plan is approved by the
Board of Directors of the Bank, or such other date as the Board shall designate in its resolution approving the Plan. 
  
 (g) “Employee” means any Employee of the Bank or any subsidiary thereof who has completed at least one Year of Service with the Bank, or any
subsidiary thereof, provided, however, that any Employee who is covered or hereinafter becomes covered by an employment contract or change in control agreement with the Employer shall not be considered to be an Employee for purposes of this Plan.

  
 (h) “Expiration Date” means a date ten (10) years
from the Effective Date unless earlier terminated pursuant to Section 8.2 or extended pursuant to Section 8.1. 
  
 (i) “Employer” means the Bank or a subsidiary of the Bank or a parent of the Bank which has adopted the Plan pursuant to Article VI hereof.

  
 (j) “Holding Company” means Ocean Financial Corp.,
the holding company of the Bank. 
  
 (k) “Just Cause”
shall mean termination because of Participant’s personal dishonesty, incompetence, willful misconduct, any breach of fiduciary duty involving personal profit, intentional failure to perform stated duties, willful violation of any law, rule or
regulation (other than traffic violations or other similar offenses) or any final cease-and desist order. 
  
 (l) “Leave of Absence” and “LOA” mean (i) the taking of an authorized or approved leave of absence under the provisions of the federal
Family and Medical Leave Act (“FMLA”), (ii) any state law providing qualitatively similar benefits as the FMLA, or (iii) a leave of absence authorized under the policies of the Bank. “Leave of Absence” and “LOA” are
defined in this paragraph for the exclusive purposes of this Plan. 

 (m) “Payment” means the payment of severance compensation as provided in Article IV hereof.

  
 (n) “Participant” means an Employee who meets the
eligibility requirements of Article III. 
  
 (o) “Plan”
means the Ocean Federal Savings Bank Employee Severance Compensation Plan. 
  
 (p) “Year of Service” means each consecutive 12 month period, beginning with an Employee’s date of hire and running without a termination of employment in which an Employee is credited with at least one
hour of service in each of the 12 calendar months in such period. The taking of a LOA shall not eliminate a period of time from being a Year of Service if such period of time otherwise qualifies as such. Further if a particular 12 month period of
time would not otherwise qualify under the Plan as a Year of Service because one hour of service is not credited during each month of such period due to the taking of a LOA, then such period of time shall be deemed to be a Year of Service for all
other sections of this Plan. 
  
 2.2 Applicable Law

  
 The laws of the State of New Jersey shall be the controlling
law in all matters relating to the Plan to the extent not preempted by Federal law. 
  
 2.3 Severability 
  
 If a
provision of this Plan shall be held illegal or invalid, the illegality or invalidity shall not affect the remaining parts of the Plan and the Plan shall be construed and enforced as if the illegal or invalid provision had not been included.

  
 ARTICLE III 
 ELIGIBILITY 
  
 3.1 Participation 
  
 The term Participant shall describe those Employees of the Bank who have completed at least one Year of Service with the Bank at the time of any
termination pursuant to Section 4.2 herein. Notwithstanding the foregoing, persons who have entered into and continue to be covered by an employment contract or change in control agreement with the Employer shall not be entitled to participate in
this Plan. 
  
 3.2 Duration of Participation 
  
 A Participant shall cease to be a Participant in the Plan when the
Participant ceases to be an Employee of the Bank or the Holding Company, unless such Participant is entitled to a Payment as provided in the Plan. A Participant entitled to receipt of a Payment shall remain a Participant in this Plan until the full
amount of such Payment has been paid to the Participant. 
  
 ARTICLE IV 
 PAYMENTS 
  
 4.1 Right to Payment 
  
 A Participant shall be entitled to receive from the Bank or the Holding Company, but not both, a Payment in the amount provided in Section 4.3 if there
has been a Change in Control of the Bank or the Holding Company and if, within one (1) year thereafter, the Participant’s employment by the Bank or the Holding Company shall terminate for any reason specified in Section 4.2, whether the
termination is voluntary or involuntary. A Participant shall not be entitled to a Payment if termination occurs by reason of death, voluntary retirement, voluntary termination other than for reasons specified in Section 4.2, Disability, or for Just
Cause. Each Participant shall be entitled to only one payment under the provisions of this Plan. 
  
 4.2 Reasons for Termination 
  
 Following a Change in Control, a Participant shall be entitled to a Payment if employment by the 

 Bank or the Holding Company is terminated, voluntarily or involuntarily, for any one or more of the following reasons
within one (1) year of the consummation of such a Change in Control: 
  
 (a) The Employer reduces the Participant’s (i) base salary (or regularly scheduled hours are increased without a pro rated increase in Base Salary); (ii) rate of compensation in the case of hourly employees; or (iii) the product of
hourly rate of compensation on regularly scheduled hours (without regard to overtime) as in effect immediately prior to the Change in Control, or as the same may have been increased thereafter. 
  
 (b) The Employer materially changes Participant’s function, duties or
responsibilities which would cause Participant’s position to be one of lesser responsibility, importance or scope with the Employer than immediately prior to the change in control. 
  
 (c) The Employer requires the Participant to change the location of the Participant’s job or office, so that such
Participant will be based at a location more than thirty (30) miles from the location of the Participant’s job or office immediately prior to the Change in Control provided that such new location is not closer to Participant’s home.

  
 (d) The Employer materially reduces the benefits and
perquisites available to the Participant immediately prior to the Change in Control, provided, however, that a material reduction in benefits and perquisites generally provided to all Employees of the Bank on a nondiscriminatory basis would not
trigger a payment pursuant to this Plan. 
  
 (e) A successor to
the Bank fails or refuses to assume the Bank’s obligations under this Plan, as required by Article VII. 
  
 (f) The Bank or any successor to the Bank breaches any other provisions of this Plan. 
  
 (g) The Employer terminates the employment of a Participant at or after a Change in Control other than for Just Cause.

  
 4.3 Amount of Payment 
  
 (a) Participants entitled to a Payment under this Plan shall receive from the Bank a lump
sum cash payment in an amount determined as follows: 
  
 (i)
Participants with a title of “Vice President” or greater shall receive a Payment equal to one full year’s salary (determined immediately prior to the time the Payment is to be made), and 
  
 (ii) All other Participants shall receive a Payment equal to one-twelfth
(1/12) of their Annual Compensation for each Year of Service, up to a maximum of 100% of such Annual Compensation. 
  
 (b) Notwithstanding the provision of (a) above, if a Payment to a Participant who is a Disqualified Individual shall be in an amount which includes an
Excess Parachute Payment, the Payment hereunder to that Participant shall be reduced to the maximum amount which does not include an Excess Parachute Payment. The terms “Disqualified Individual” and “Excess Parachute Payment”
shall have the same meaning as defined in Section 280G of the Internal Revenue Code of 1986, as amended, or any successor section of similar import. 
  
 The Participant shall not be required to mitigate damages on the amount of the Payment by seeking other employment or otherwise, nor shall the amount of
such Payment be reduced by any compensation earned by the Participant as a result of employment after termination of employment hereunder. 
  
 4.4 Time of Payment 
  
 The Payment to which a Participant is entitled shall be paid to the Participant by the Bank or the Holding Company or its successor, in cash and in full,
not later than twenty (20) business days after the termination of the Participant’s employment. If any Participant should die after termination of the employment but before all amounts have been paid, such unpaid amounts shall be paid to the
Participant’s named beneficiary, if living, otherwise to the personal representative on behalf of or for the benefit of the Participant’s estate. 

 4.5 Suspension of Payment 
  
 Notwithstanding the foregoing, no payments or portions thereof shall be made under this Plan, if such payment or portion
would result in the Bank failing to meet its minimum regulatory capital requirements as required by 12 C.F.R. § 567.2 of the Office of Thrift Supervision Regulations. Any payments or portions thereof not paid shall be suspended until such time
as their payment would not result in a failure to meet the Bank’s minimum regulatory capital requirements. Any portion of benefit payments which have not been suspended will be paid on an equitable basis, pro rata based upon amounts due each
Participant, among all eligible Participants. 
  
 ARTICLE V

 OTHER RIGHTS AND BENEFITS NOT AFFECTED 
  

5.1 Other Benefits 
  
 Neither the provisions of this Plan nor the Payment provided for hereunder shall reduce any amounts otherwise payable, or in any way diminish the
Participant’s rights as an Employee of the Bank or the Holding Company, whether existing now or hereafter, under any benefit, incentive, retirement, stock option, stock bonus, stock ownership or any employment agreement or other plan or
arrangement. 
  
 5.2 Employment Status 
  
 This Plan does not constitute a contract of employment or impose on the
Participant or the Participant’s Employer any obligation to retain the Participant as an employee or Officer, to change the status of the Participant’s employment, or to change the Employer’s policies regarding termination of
employment. 
  
 ARTICLE VI 
 PARTICIPATING EMPLOYERS 
  
 6.1 Upon approval by the Board of Directors of the Bank, this Plan may be adopted by any Subsidiary or Parent of the Bank. Upon such adoption, the
Subsidiary or Parent shall become an Employer hereunder and the provisions of the Plan shall be fully applicable to the Employees of that Subsidiary or Parent. The term “Subsidiary” means any corporation in which the Bank, directly or
indirectly, holds a majority of the voting power of its outstanding shares of capital stock. The term “Parent” means any corporation which holds a majority of the voting power of the Bank’s outstanding shares of capital stock.

  
 ARTICLE VII 
 SUCCESSOR TO THE BANK 
  
 7.1 The Bank shall require any successor or assignee, whether direct or indirect, by purchase, merger, consolidation or otherwise, to all or substantially
all the business or assets of the Bank, expressly and unconditionally to assume and agree to perform the Bank’s obligations under this plan, in the same manner and to the same extent that the Bank would be required to perform if no such
succession or assignment had taken place. 
  
 ARTICLE VIII

 DURATION, AMENDMENT AND TERMINATION 
  
 8.1 Duration 
  
 If a Change in Control has not occurred, this Plan shall expire as of the Expiration Date, unless sooner terminated as provided in Section 8.2, or unless
extended for an additional period or periods by resolution adopted by the Board of Directors of the Bank. 
  
 Notwithstanding the foregoing, if a Change in Control occurs this Plan shall continue in full force and effect, and shall not terminate or expire until
such date as all Participants who become entitled to Payments hereunder shall have received such Payments in full. 
  
 8.2 Amendment and Termination 
  
 The Plan may be terminated or amended in any respect by resolution adopted by a majority of the Board of Directors of the Bank, unless a Change in Control
has previously occurred. If a Change in Control occurs, the Plan no longer shall be subject to amendment, change, substitution, deletion, revocation or termination in any respect whatsoever. 

 8.3 Form of Amendment 
  
 The form of any proper amendment or termination of the Plan shall be a written instrument signed by a duly authorized
officer or officers of the Bank, certifying that the amendment or termination has been approved by the Board of Directors. A proper amendment of the Plan automatically shall effect a corresponding amendment to each Participant’s rights
hereunder. A proper termination of the Plan automatically shall effect a termination of all Participants’ rights and benefits hereunder. 
  
 8.4 No Attachment 
  
 (a) Except as required by law, no right to receive payments under this Plan shall be subject to anticipation, commutation, alienation, sale, assignment,
encumbrance, charge, pledge, or hypothecation, or to execution, attachment, levy, or similar process or assignment by operation of law, and any attempt, voluntary or involuntary, to affect such action shall be null, void, and of no effect.

  
 (b) This Plan shall be binding upon, and inure to the benefit
of, Employee and the Bank and their respective successors and assigns. 
  
 ARTICLE IX 
 LEGAL FEES AND EXPENSES 
  
 9.1 All reasonable legal fees and other expenses paid or incurred by a party hereto pursuant to any dispute or question of
interpretation relating to this Plan shall be paid or reimbursed by the Bank or the Holding Company if a Participant is found to have made a claim which is not without merit pursuant to any legal judgment, arbitration or settlement. 
  
 ARTICLE X 
 REQUIRED PROVISIONS 
  
 10.1 The Bank may terminate the Employee’s employment at any time, but any termination by the Bank, other than Termination for Cause, shall not prejudice Employee’s right to compensation or other benefits
under this Agreement. Employee shall not have the right to receive compensation or other benefits for any period after termination for Just Cause as defined in Section 2.1 hereinabove. 
  
 10.2 If the Employee is suspended and/or temporarily prohibited from participating in the conduct of the Bank’s affairs
by a notice served under Section 8(e)(3) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(3) or (g)(1), the Bank’s obligations under this contract shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the Bank may in its discretion (i) pay the Employee all or part of the compensation withheld while their contract obligations were suspended and (ii) reinstate (in whole or in
part) any of the obligations which were suspended. 
  
 10.3 If the
Employee is removed and/or permanently prohibited from participating in the conduct of the Bank’s affairs by an order issued under Section 8(e)(4) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(4) or (g)(1), all
obligations of the Bank under this contract shall terminate as of the effective date of the order, but vested rights of the contracting parties shall not be affected. 
  
 10.4 If the Bank is in default as defined in Section 3(x)(1) of the Federal Deposit Insurance Act, 12 U.S.C.
§1813(x)(1), all obligations of the Bank under this contract shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting parties. 
  
 10.5 All obligations of the Bank under this contract shall be terminated,
except to the extent determined that continuation of the contract is necessary for the continued operation of the institution, (i) by the Director of the OTS (or his designee), the Federal Deposit Insurance Corporation (“FDIC”) or the
Resolution Trust Corporation (“RTC”), at the time FDIC enters into an agreement to provide assistance to or on behalf of the Bank under the authority contained in Section 13(c) of the Federal Deposit Insurance Act, 12 U.S.C. §1823(c);
or (ii) by the Director of the OTS (or his designee) at the time the Director (or his designee) approves a supervisory merger to resolve problems related to the operations of the Bank or when the Bank is determined by the Director to be in an unsafe
or unsound condition. Any rights of the parties that have already vested, however, shall not be affected by such action. 
  
 10.6 Any payments made to a Participant pursuant to this Agreement, or otherwise, are subject to and conditioned upon compliance with 12 U.S.C.
§1828(k) and any rules and regulations promulgated thereunder. 

 ARTICLE XI 
 ADMINISTRATIVE PROVISIONS 
  
 11.1 Plan Administrator. The administrator of the Plan shall be under the supervision of the Board of Directors of the Bank or a Committee appointed by the Board (the “Board”). It shall be a principal duty of the Board to
see that the Plan is carried out in accordance with its terms, for the exclusive benefit of persons entitled to participate in the Plan without discrimination among them. The Board will have full power to administer the Plan in all of its details
subject, however, to the requirements of ERISA. For this purpose, the Board’s powers will include, but will not be limited to, the following authority, in addition to all other powers provided by this Plan: (a) to make and enforce such rules
and regulations as it deems necessary or proper for the efficient administration of the Plan; (b) to interpret the Plan, its interpretation thereof in good faith to be final and conclusive on all persons claiming benefits under the Plan; (c) to
decide all questions concerning the Plan and the eligibility of any person to participate in the Plan; (d) to compute the amount of Payment that will be payable to any Participant or other person in accordance with the provisions of the Plan, and to
determine the person or persons to whom such benefits will be paid; (e) to authorize Payments; (f) to appoint such agents, counsel, accountants, consultants and actuaries as may be required to assist in administering the Plan; and (g) to allocate
and delegate its responsibilities under the Plan and to designate other persons to carry out any of its responsibilities under the Plan, any such allocation, delegation or designation to be by written instrument and in accordance with Section 405 of
ERISA. 
  
 11.2 Named fiduciary. The Board will be a
“named fiduciary” for purposes of Section 402(a)(1) of ERISA with authority to control and manage the operation and administration of the Plan, and will be responsible for complying with all of the reporting and disclosure requirements of
Part 1 of Subtitle B of Title I of ERISA. 
  
 11.3 Claims and
review procedures. 
  
 (a) Claims procedure. If any
person believes he is being denied any rights or benefits under the Plan, such person may file a claim in writing with the Board. If any such claim is wholly or partially denied, the Board will notify such person of its decision in writing. Such
notification will be written in a manner calculated to be understood by such person and will contain (i) specific reasons for the denial, (ii) specific reference to pertinent Plan provisions, (iii) a description of any additional material or
information necessary for such person to perfect such claim and an explanation of why such material or information is necessary and (iv) information as to the steps to be taken if the person wishes to submit a request for review. Such notification
will be given within 90 days after the claim is received by the Board (or within 180 days, if special circumstances require an extension of time for processing the claim, and if written notice of such extension and circumstances is given to such
person within the initial 90 day period). If such notification is not given within such period, the claim will be considered denied as of the last day of such period and such person may request a review of his claim. 
  
 (b) Review procedure. Within 60 days after the date on which a person
receives a written notice of a denied claim (or, if applicable, within 60 days after the date on which such denial is considered to have occurred) such person (or his duly authorized representative) may (i) file a written request with the Board for
a review of his denied claim and of pertinent documents and (ii) submit written issues and comments to the Board. The Board will notify such person of its decision in writing. Such notification will be written in a manner calculated to be understood
by such person and will contain specific reasons for the decision as well as specific references to pertinent Plan provisions. The decision on review will be made within 60 days after the request for review is received by the Board (or within 120
days, if special circumstances require an extension of time for processing the requests such as an election by the Board to hold a hearing, and if written notice of such extension and circumstances is given to such person within the initial 60 day
period). If the decision on review is not made within such period, the claim will be considered denied. 
  
 11.4 Nondiscriminatory exercise of authority. Whenever, in the administration of the Plan, any discretionary action by the Board is required, the
Board shall exercise its authority in a nondiscriminatory manner so that all persons similarly situated will receive substantially the same treatment. 
  
 11.5 Indemnification of Board. The Bank will indemnify and defend to the fullest extent permitted by law any person serving on the Board or as a
member of a committee designated as Board (including any person who formerly served as a Board member or as a member of such committee) 

 against all liabilities, damages, costs and expenses (including attorneys fees and amounts paid in settlement of any
claims approved by the Bank) occasioned by any act or omission to act in connection with the Plan, if such act or omission is in good faith. 
  
 11.6 “Plan Year” means the period beginning on the Effective Date and ending on July 2, 1997 and the 12 consecutive-month period ending
each year thereafter. 
  
 11.7 Benefits solely from general
assets. The benefits provided hereunder will be paid solely from the general assets of the Bank. Nothing herein will be construed to require the Bank or the Board to maintain any fund or segregate any amount for the benefit of any Participant,
and no Participant or other person shall have any claim against, right to, or security or other interest in, any fund, account or asset of the Bank from which any payment under the Plan may be made. 

 Having been adopted by its Board of Directors on July 17, 1996, this Plan is executed by its duly
authorized officers this 17th the day of July, 1996. 
  

							
	Attest	 	 	 	OCEAN FEDERAL SAVINGS BANK
				
	  

 Secretary
	 	 	 	By:	 	  

  
 Having been adopted by
its Board of Directors on July 17, 1996, this Plan is executed by its duly authorized officers this 17th day of July, 1996. 
  

					
	 Attest
  
  

	 	 	 	 OCEAN FINANCIAL CORP.
  
  

	SecretaryDaniel Crawford Employment Agreement

 Exhibit 10.16 
  
 EMPLOYMENT AGREEMENT 
  
 THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into effective as of June 2, 2005 (the “Effective Date”), by and
between MCI, Inc., a Delaware corporation (the “Company”), and Daniel E. Crawford (the “Executive”). In consideration of the mutual covenants set forth herein, the Company and the Executive hereby agree as follows: 
  
 1. Position; Duties. 
  
 (a) During the Period of Agreement (as defined in Section 2), the Executive shall be employed as the President,
International and Wholesale of the Company. The Executive shall report directly to President and Chief Executive Officer. The Executive shall have the duties, responsibilities, powers, and authority customarily associated with the position of
President, International and Wholesale and shall perform such other and unrelated services and duties as may be assigned to the Executive from time to time by the President and Chief Executive Officer consistent with the Executive’s position as
President, International and Wholesale. 
  
 (b) The Executive
shall diligently, competently, and faithfully perform all duties, and shall devote the Executive’s entire business time, energy, attention, and skill to the performance of duties for the Company and its subsidiaries and affiliates and will use
the Executive’s best efforts to promote the interests of the Company. It shall not be considered a violation of the foregoing for the Executive to serve on industry, civic, religious or charitable boards or committees, so long as such
activities do not individually or in the aggregate significantly interfere with the performance of the Executive’s responsibilities as an employee of the Company in accordance with this Agreement. 
  
 2. Term. The initial term of this Agreement shall commence on the Effective Date and
continue through December 31, 2006, unless terminated prior to such date as provided at Section 8 hereof (the “Period of Agreement”). The Period of Agreement may be extended upon the written agreement of the parties as approved by the
Board of Directors of the Company (the “Board”). Upon the expiration of the Period of Agreement, except as provided herein, this Agreement shall terminate, and any continuation of the Executive’s employment with the Company thereafter
shall be “at-will.” 
  
 3. Base Salary. The Executive’s
annual base salary (the “Base Salary”) shall be $370,000, which amount shall not be decreased except upon mutual consent or due to a decrease generally applicable to all senior executives of the Company. The Board or, if so delegated by
the Board, the Compensation Committee shall review the Base Salary annually, but shall not have any obligation to increase such amount. No increase in the Executive’s Base Salary may be implemented prior to review and approval by the Board or,
if so delegated by the Board, the Compensation Committee. Any increase in Base Salary shall constitute the Executive’s “Base Salary” thereafter under this Agreement. The Base Salary shall be payable in substantially equal installments
in accordance with the Company’s payroll policy in effect from time to time and shall be subject to any payroll or other deductions as may be required to be made pursuant to law, government or court order or by agreement with, or consent of,
the Executive. 
  
 4. Bonus. The Executive shall be eligible to receive a
bonus equal to 100% of the Executive’s Base Salary for performance at target levels based upon performance standards, with smaller or greater bonus opportunities for performance below or above target levels, all as determined by the Board.

  
 5. Benefits and Perquisites. The Executive shall be entitled to
participate in such life insurance, disability, medical, dental, pension, profit sharing and retirement plans and other programs as may be made generally available from time to time by the Company for the benefit of executives at the
Executive’s level and its employees generally. The Company shall provide the Executive with such perquisites as are provided from time to time by the Company to its executives generally. The Executive shall be entitled to receive such other
compensation, benefits and perquisites as set forth on Appendix 1 to this Agreement. 
  

 1 

 6. Expenses. The Company shall reimburse the Executive for all reasonable expenses reasonably incurred by the
Executive in performing services hereunder, which are incurred and accounted for in accordance with the Company’s policies and procedures applicable thereto. 
  
 7. Liability Insurance; Indemnification. The Company shall maintain officers’ liability insurance coverage for Executive in
reasonable amounts during the Period of Agreement and, for any act or omission occurring during the Period of Agreement, at all times thereafter for the duration of any period of limitations during which any action may be brought against the
Executive, in the same amount and to the same extent as the Company covers members of the Board. The Executive shall be indemnified and held harmless to the fullest extent permitted under the Company’s Articles of Incorporation, Bylaws, and
applicable law, including the U.S. Bankruptcy Code (11 U.S.C. § 101 et seq.), from any and all claims, lawsuits, losses, damages, assessments, amounts paid in settlement, penalties, expenses, costs and liabilities of any kind or nature,
including without limitation, court costs and reasonable attorneys’ fees, which the Executive may sustain directly as a result of, or in connection with, any act or omission by the Company or its employees or any claim, suit or other proceeding
brought or threatened by a third party (including but not limited to governmental or regulatory agencies or bodies) in connection with the Executive’s employment with the Company or any subsidiary or affiliate thereof. 
  
 8. Termination of Employment. 
  
 (a) Death or Disability. The Period of Agreement shall terminate
automatically upon the Executive’s death. If the Company determines in good faith that the Disability of the Executive has occurred (pursuant to the definition of “Disability” set forth below), it may give to the Executive written
notice of its intention to terminate the Executive’s employment. In such event, the Period of Agreement and the Executive’s employment with the Company shall terminate effective on the thirtieth (30th) day after receipt by the Executive of
such notice given at any time after the date of the Executive’s Disability, while such Disability is continuing (“Disability Effective Date”); provided that, within the thirty (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” means the completion of a period of the Executive’s physical or mental incapacity which continues for not less than six (6)
consecutive months or six (6) months in any twelve (12)-month period, as determined by a doctor mutually agreeable to the Executive and the Board. Until the Disability Effective Date, the Executive shall be entitled to all compensation provided for
under this Agreement. It is understood that nothing in this Section 8(a) shall serve to limit the Company’s obligations under Section 9(c) hereof. 
  
 (b) By the Company for Cause. The Company may terminate the Executive’s employment and the Period of Agreement immediately for
“Cause.” For purposes of this Agreement, “Cause” means (i) the commission of (x) a felony or (y) a misdemeanor (excluding a petty misdemeanor) involving dishonesty, fraud, financial impropriety, or moral turpitude; (ii) any
knowing or deliberate violation of a requirement of the Sarbanes-Oxley Act of 2002 or other material provision of the federal securities laws; (iii) willful neglect or willful misconduct in the discharge of the Executive’s duties (after
receiving written notice from the Board specifying the manner in which the Executive is alleged to have willfully failed properly to discharge the Executive’s duties and after having had the opportunity to cure such failure within thirty (30)
days from receipt of such notice), (iv) any willful conduct that could reasonably be anticipated to result in or materially contribute to (whether by act or by omission to act) a violation by the Company of the Permanent Injunction dated November
26, 2002 (the “Permanent Injunction”) or other orders binding on the Company issued by the Honorable Jed S. Rakoff of the U.S. District Court of the Southern District of New York (the “Court”), or (v) material breach by the
Executive of this Agreement, including any of the covenants contained herein. In the event that the Company asserts that grounds exist for termination with Cause, prior to such termination, it shall so notify the Executive and within fifteen (15)
days shall afford the Executive a hearing before the Board regarding any disputed facts. The Board shall make a final determination regarding the existence of “Cause” upon completion of any such hearing, provided, however, that any
determination that “Cause” exists shall require an affirmative vote of two-thirds (2/3) of the non-employee directors of the Company. If any such determination remains pending after such fifteen (15)-day period, the Company shall be
entitled to suspend the Executive’s duties (with full pay) pending determination of the 

  

 2 

 
existence of “Cause”; provided that such period of suspension shall not exceed thirty (30) days. The Executive’s acts or omissions shall not
be “willful” if conducted in good faith and with a reasonable belief that such conduct was in the best interests of the Company. 
  
 (c) By Executive for Good Reason. The Executive may terminate Executive’s employment and the Period of Agreement for Good Reason upon at least
thirty (30) days’ prior written notice from the Executive to the Executive Vice President and Chief Financial Officer of the Company. For purposes of this Agreement, “Good Reason” means, without the Executive’s prior
written consent, the occurrence of (i) a demotion or removal of the Executive from any of the Executive’s positions, (ii) a material adverse change by the Company in the Executive’s duties or responsibilities, (iii) a decrease in the
Executive’s Base Salary or the Company’s failure to provide an opportunity to earn performance bonuses and other compensation as provided in Sections 4 and 5, above, and Section 10, below, or (iv) any other material breach of this
Agreement by the Company which is not cured within thirty (30) days’ prior written notice by the Executive to the Company specifying such breach. “Good Reason” does not include (A) any failure to extend the term of this Agreement at
the conclusion of the Period of Agreement, (B) the failure of the Company to grant any annual equity award if established performance standards are satisfied, provided equivalent compensation is provided, (C) implementation of any changes in
corporate governance required as part of the SEC settlement or any other actions by the Company to comply with the Permanent Injunction or any other order binding on the Company issued by the Court or to comply with any provision of law, or (D) any
adverse change in compensation or benefits applicable to all senior executives which is proportionate to each such executive’s compensation or benefits, as the case may be, immediately prior to such change. The Executive shall be
required to make any assertion of “Good Reason” within 45 days of the events allegedly giving rise to “Good Reason”. 
  
 (d) Other than for Cause or Good Reason. The Executive or the Company may terminate the Executive’s employment and the Period of Agreement for
any reason other than for Good Reason or other than for Cause, respectively, upon fifteen (15) days’ prior written notice to the Company or Executive, as the case may be. 
  
 (e) Notice of Termination. Any termination of employment by the Company or by the Executive shall be communicated by
a notice of termination to the other party hereto given in accordance with Section 19 of this Agreement (the “Notice of Termination”). 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) sets forth in reasonable detail, if necessary, 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 (as defined below) is other than the date of receipt of such notice, specifies the termination date. The failure by the Executive or the Company to set forth in the Notice of Termination
any fact or circumstance which contributes to a showing of the basis for termination shall not waive any right of such party hereunder or preclude such party from asserting such fact or circumstance in enforcing his/her or its rights hereunder.

  
 (f) Date of Termination. “Date of
Termination” means the date specified in the Notice of Termination; provided, however, that if the Executive’s employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of the Executive
or the Disability Effective Date, as the case may be. 
  
 9. Obligations of the
Company Upon Termination. The following provisions describe the obligations of the Company to the Executive upon termination of the Executive’s employment during the Period of Agreement. However, except as explicitly provided in this
Agreement, nothing in this Agreement shall limit or otherwise adversely affect any rights which the Executive may have under applicable law, under any other written agreement with the Company, or under any compensation or benefit plan, program,
policy or practice of the Company. 
  

 3 

 (a) Termination not for Cause or for Good Reason. If the Executive’s employment is terminated
during the Period of Agreement by Company not for Cause (and other than due to death or Disability) or by the Executive for Good Reason, the Executive shall, in lieu of any other severance benefits under the Company’s severance plans, be
entitled to the following:  
  
 (i)
continuation of the Executive’s then-current Base Salary and then-current target bonus for a period of two (2) years after the Date of Termination (the “Salary Continuation Period”), the Base Salary component to be payable as set
forth in Section 3, above, and the target bonus component to be payable in monthly installments equal to one-twelfth (1/12) of the Executive’s then-current annual target bonus opportunity set forth in Section 4, above; provided that the sum of
such payments shall not exceed the maximum amount permitted under the Company’s Articles of Incorporation; 
  
 (ii) continued health coverage for the Executive and the Executive’s eligible dependents at active employee rates for the Salary
Continuation Period, with COBRA continuation to begin at the end of such period; 
  
 (iii) payment of all accrued but not yet paid Base Salary, accrued vacation, any earned and unpaid bonus for the previous year or other
performance period, unreimbursed business expenses (in accordance with Company policy and procedures), and any accrued unpaid benefits under the Company’s group benefit plans, payable through the Date of Termination (collectively, “Accrued
Obligations”); and  
  
 (iv) a bonus
(based upon actual performance) for the year (or other performance period) in which the Executive’s termination occurs, prorated based on the number of days elapsed during said year (or other performance period) through the Date of Termination,
payable at the time bonuses are paid to senior executives generally. 
  
 The
Executive shall be entitled to the amounts and benefits under this Section 9(a) (other than Accrued Obligations) only upon the Executive’s execution (without revocation) of a general release of all claims of the Executive that may be brought
against the Company occurring through and including the release date in the form of Appendix 2 hereto (with such changes therein as may be necessary to make it valid and encompassing under applicable law). 
  
 (b) Termination for Cause, for other than Good Reason or at the Expiration
of the Period of Agreement. If the Executive’s employment is terminated during the Period of Agreement by the Company for Cause or by the Executive not for Good Reason, or if the Executive’s employment is terminated by either party for
any reason at the expiration of the Period of Agreement, the Executive will receive the Executive’s Accrued Obligations through the Date of Termination (except to the extent subject to disgorgement under any applicable legal requirement). The
Company shall be entitled to offset the amount due from the Executive of any repayments of compensation awarded hereunder against any amounts due to the Executive, without waiving or limiting the Company’s rights to recover any excess amount
due to it. 
  
 (c) Termination Due to Death or
Disability. In the event of the Executive’s death or termination of employment due to Disability during the Period of Agreement, the Executive’s estate or the Executive, as the case may be, shall be entitled to receive the following:
 
  
 (i) a bonus (based upon actual
performance) for the year (or other performance period) in which the Executive’s termination occurs, prorated based on the number of days elapsed during said year (or other performance period) through the Date of Termination, payable at the
time bonuses are paid to senior executives generally; 
  
 (ii) payment of the Executive’s Accrued Obligations; and  
  
 (iii) continued health coverage for the Executive and/or the Executive’s eligible dependents, as applicable, at active employee rates
for eighteen (18) months following the Date of Termination, which will run concurrently with COBRA. 
  

 4 

 10. Equity Awards. For each full calendar year during the Period of Agreement, the Executive shall be eligible at
the targeted performance levels to receive an annual equity award commensurate with the Executive’s position as determined by the Board in its discretion.  
  
 11. Treatment of Equity Awards on Termination. Upon the termination of Executive’s employment, either during, at the expiration
of, or after the Period of Agreement, the vesting of any unvested equity awards granted during the Period of Agreement shall be determined as follows: 
  
 (a) In the event of termination of the Executive’s employment (i) by the Company not for Cause (and other than due to the Executive’s death or
Disability), or (ii) by the Executive for Good Reason, the Executive shall be deemed to be an active employee of the Company for two (2) years following the Date of Termination for purposes of determining the vesting of each such equity award.

  
 (b) In the event of termination of the Executive’s
employment (i) by the Executive not for Good Reason or (ii) by the Company for Cause, any such equity awards that are unvested shall be forfeited. 
  
 (c) In the event of the Executive’s death or termination due to Disability, any such equity awards that are unvested shall immediately fully vest.

  
 12. Non-Competition. 
  
 (a) In the event that the Executive’s employment is terminated for any
reason during the Period of Agreement, but not at or after the expiration of the Period of Agreement, for a period of one (1) year after the Date of Termination, the Executive shall not become an employee, consultant, advisor, director or assume any
other position or relationship with the following companies or their subsidiaries and affiliates: AT&T Corporation, SBC Communications, Inc., Sprint Corporation, Qwest. or Verizon Communications. 
  
 (b) The Executive agrees to, and shall, execute the Company’s
Non-Disclosure, Intellectual Property Assignment and Non-Solicitation Agreement, attached hereto as Appendix 3. The terms of the Non-Disclosure, Intellectual Property Assignment and Non-Solicitation Agreement are incorporated herein by this
reference and shall survive any termination of the employment relationship created hereunder or the termination of the Period of Agreement. 
  
 (c) The Executive acknowledges that the Company has no adequate remedy at law and will be irreparably harmed if the Executive breaches or threatens to
breach the provisions of this Section 12, and, therefore, agrees that the Company shall be entitled to injunctive relief to prevent any breach or threatened breach of this Section and that the Company shall be entitled to specific performance of the
terms of this Section in addition to any other legal or equitable remedy it may have. Nothing in this Agreement shall be construed as prohibiting the Company from pursuing any other remedies at law or in equity that it may have or any other rights
that it may have under any other agreement. 
  
 13. Change in Control.
 
  
 (a) Definition of “Change in
Control.” The definition of Change in Control shall occur upon the occurrence of any one of the following events during the Period of Agreement: 
  
 (i) the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the assets of the Company and
its Restricted Subsidiaries (as defined in the indentures pursuant to which senior notes of the Company are to be issued to certain of the Company’s creditors in accordance with the Company’s Modified Second Amended Joint Plan of
Reorganization under chapter 11 of title 11 of the United States Code, as confirmed on October 31, 2003 by the United States Bankruptcy Court for the Southern District of New York) taken as a whole to any other “person” or
“group,” as that term is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), (other than the Company or any of its Restricted Subsidiaries), other than a creation of a holding company
that does not 

  

 5 

 
involve a change in the beneficial ownership of the Company as a result of the transaction and other than a creation of a holding company that does not
involve a change in the beneficial ownership of the Company as a result of the transaction; 
  
 (ii) the adoption of a plan relating to the liquidation or dissolution of the Company; 
  
 (iii) any “person” or “group” (as such
terms are used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in rules 13d-3 and 13d-5 under the Exchange Act (except that a person shall be deemed to have beneficial ownership of all
shares that such Person has a right to acquire, whether such right is exercisable immediately or after 60 days), directly or indirectly of more than 50% of the voting power of the voting stock of the Company by way of purchase, merger or
consolidation or otherwise; 
  
 (iv) the merger
or consolidation with or into another Person or merger of another Person into the Company with the effect that immediately after that transaction the existing stockholders of the Company immediately before the transaction hold, directly or
indirectly, less than 50% of the total voting power of all securities generally entitled to vote in the election of directors, managers or trustees of the Person surviving the merger or consolidation; or 
  
 (v) the first day on which a majority of the members of the
Company’s Board of Directors are not Continuing Directors. For purposes of the preceding clause (e), “Continuing Directors” means, as of any date of determination, any member of the Company’s Board of Directors who: (i)
was a member of the Company’s Board of Directors on the Effective Date; or (ii) was nominated for election or elected to the Company’s Board of Directors with the affirmative vote of, or whose election or appointment was otherwise approved
or ratified (whether before or after nomination or election) by, at least a majority of the Continuing Directors who were members of the Company’s Board of Directors at the time of the nomination, election or approval, as applicable.

  
 (b) Upon a Change in Control described in Section 13(a)(i),
above, all equity awards granted to the Executive shall immediately fully vest and any restrictions on disposition of vested stock or the payment of any deferred stock units shall lapse. 
  
 (c) Impact of Termination by Company or the Executive During Protection Period. If the Executive’s employment is
terminated by the Company not for Cause (and other than due to death or Disability) or by the Executive for Good Reason within the two (2)-year period immediately following a Change in Control of the Company (regardless of whether the Period of
Agreement would have otherwise expired without the occurrence of a Change in Control) or in the event the Executive’s employment is terminated within six (6) months prior to and in anticipation of a Change in Control or is demonstrated to be at
the request of a third party that had taken steps reasonably calculated to effect a Change in Control, the Executive shall, in lieu of any other severance benefits and in lieu of benefits provided under Section 9(a), be entitled to the
following: 
  
 (i) a lump sum payment, to
be made within thirty (30) days of the Date of Termination, equal to two (2) times the sum of the Executive’s then-current Base Salary and then-current target bonus; 
  
 (ii) continued health coverage for the Executive and the Executive’s eligible dependents at active
employee rates for two (2) years, with COBRA continuation to begin at the end of such period; 
  
 (iii) payment of all Accrued Obligations; 
  

(iv) a bonus (based upon actual performance) for the year (or other performance period) in which the Executive’s termination
occurs, prorated based on the number of days elapsed during said year (or other performance period) through the Date of Termination, payable at the time bonuses are paid to senior executives generally; 
  
 (v) all unvested equity awards shall immediately vest and
any restrictions on disposition of vested stock or on the payment of any deferred stock units shall lapse; 
  

 6 

 (vi) any deferred compensation shall become payable; 
  
 (vii) any amounts “earned” under other incentive
plans that have not vested will vest and become payable as follows: (A) if based upon objective factors that can reasonably be determined, payment shall be based upon actual performance for such period or, if actual performance cannot be determined,
pro-rated based on the relevant period of service, and (B) if any other factors or performance measures cannot reasonably be determined, payment shall be at target, pro-rated based on the relevant period of service; and 
  
 (viii) the Executive shall receive two (2) years of service
and age credit for vesting and eligibility (but not accrual) purposes under Company retirement or welfare programs and other benefit programs, payable outside plans to the extent that the Executive is not eligible for such payment under the terms of
such plans, and two (2) years of welfare program coverage at active employee rates. 
  
 The Executive shall be entitled to the amounts and benefits under this Section 13(c) (other than Accrued Obligations) only upon the Executive’s execution (without revocation) of a general release of all claims of the Executive that may
be brought against the Company occurring through and including the release date in the form of Appendix 2 hereto (with such changes therein as may be necessary to make it valid and encompassing under applicable law). 
  
 (d) Parachute Gross-Up. In the event that the aggregate of all
payments or benefits made or provided to, or that may be made or provided to, the Executive under this Agreement and under all other plans, programs and arrangements of the Company (the “Aggregate Payment”) is determined to constitute an
“excess parachute payment,” as such term is defined in Section 280G(b) of the Internal Revenue Code, the Company shall pay to the Executive prior to the time any excise tax imposed by Section 4999 of the Internal Revenue Code (“Excise
Tax”) is payable with respect to such Aggregate Payment, an additional amount which, after the imposition of all income and excise taxes thereon, is equal to the Excise Tax on the Aggregate Payment. The determination of whether the Aggregate
Payment constitutes an excess parachute payment and, if so, the amount to be provided to the Executive and the time of payment pursuant to this Section 13(d) shall be made by an independent auditor (the “Auditor”) selected jointly by the
Company and the Executive and paid by the Company. The Auditor shall be a nationally recognized United States public accounting firm which has not, during the two (2) years preceding the date of its selection, acted in any way on behalf of the
Company or any affiliate thereof. If the Executive and the Company cannot agree on the firm to serve as the Auditor, then the Executive and the Company shall each select one accounting firm and those two firms shall jointly select the accounting
firm to serve as the Auditor. Notwithstanding the foregoing, in the event that the amount of the Executive’s Excise Tax liability is subsequently determined to be greater than the Excise Tax liability with respect to which any initial payment
to the Executive under this Section 13(d) has been made, the Company shall pay to the Executive an additional amount (grossed up for all taxes) with respect to such additional Excise Tax (and any interest and penalties thereon) at the time and in
the amount reasonably determined by the Auditor. Similarly, if the amount of the Executive’s Excise Tax liability is subsequently determined to be less than the Excise Tax liability with respect to which any prior payment to the Executive has
been made under this Section 13(d), the Executive shall refund to the Company the excess amount received, after reduction for any nonrefundable tax, penalties and/or interest incurred by the Executive in connection with the receipt of such excess,
and such refund shall be paid promptly after the Executive has received any corresponding refund of excess Excise Tax paid to the Internal Revenue Service. The Executive and the Company shall cooperate with each other in connection with any
proceeding or claim relating to the existence or amount of liability for Excise Tax, and all expenses incurred by the Executive in connection therewith shall be paid by the Company promptly upon notice of demand from the Executive. 
  
 14. Dispute Resolution. In the event of any dispute between the Company and the
Executive, whether arising out of or relating to this Agreement, the breach of this Agreement, or otherwise, including without limitation if the Executive shall assert the existence of Good Reason or any other breach of this Agreement and the
Company shall disagree as to the existence of Good Reason or any other asserted breach, the Executive and the Company hereby agree that such dispute shall be resolved by binding arbitration administered by the American Arbitration 

  

 7 

 
Association (“AAA”) in accordance with its Commercial Arbitration Rules then in effect, and judgment on the award rendered by the arbitrator may be
entered in any court having jurisdiction thereof. Any arbitration shall be held before a single arbitrator who shall be selected by the mutual agreement of the Company and the Executive, unless the parties are unable to agree to an arbitrator, in
which case, the arbitrator will be selected under the procedures of the AAA. The arbitrator shall have the authority to award any remedy or relief that a court of competent jurisdiction could order or grant, including, without limitation, the
issuance of an injunction, and the parties hereby agree to the emergency procedures of the AAA. However, either party may, without inconsistency with this arbitration provision, apply to any court having jurisdiction over such dispute or controversy
and seek interim provisional, injunctive or other equitable relief until the arbitration award is rendered or the controversy is otherwise resolved. Except as necessary in court proceedings to enforce this arbitration provision or an award rendered
hereunder, or to obtain interim relief, neither a party nor an arbitrator may disclose the existence, content or results of any arbitration hereunder without the prior written consent of the Company and the Executive. The arbitration proceeding
shall be conducted in the Washington, D.C. metropolitan area. In the event of any such proceeding, the losing party shall reimburse the prevailing party upon entry of a final award resolving the subject of the dispute for all reasonable legal
expenses incurred, unless the arbitrator determines that to do so would be unjust. This Agreement shall be governed by the substantive provisions of the laws of the State of Delaware. 
  
 15. Mutual Cooperation. The parties agree to take reasonable steps (without cost to the Executive) to minimize the Company’s tax
obligations with respect to annual compensation. 
  
 16. Undertaking.
Attached hereto as Appendix 4 is a letter constituting an ethics pledge signed by the Executive, which shall be an integral part of this Agreement. 
  
 17. Cooperation with Ongoing Investigations. The Executive agrees that the Executive will fully cooperate, and will cause and direct the persons under the
Executive’s management direction employed by, or consultants or agents to, the Company to cooperate fully, with all governmental investigations of the Company and all orders entered by the Court. 
  
 18. Withholding. Anything in this Agreement to the contrary notwithstanding, all
payments required to be made by the Company hereunder to the Executive shall be subject to withholding, at the time payments are actually made to the Executive and received by the Executive, of such amounts relating to taxes as the Company may
reasonably determine it should withhold pursuant to any applicable law or regulation. In lieu of withholding such amounts, in whole or in part, the Company may, in its sole discretion, accept other provision for payment of taxes as required by law,
provided that it is satisfied that all requirements of law as to its responsibilities to withhold such taxes have been satisfied. 
  
 19. Notices. Any and all notices required in connection with this Agreement shall be deemed adequately given only if in writing and (a) personally delivered, or
sent by first class, registered or certified mail, postage prepaid, return receipt requested, or by recognized overnight courier, (b) sent by facsimile, provided a hard copy is mailed on that date to the party for whom such notices are intended, or
(c) sent by other means at least as fast and reliable as first class mail. A written notice shall be deemed to have been given to the recipient party on the earlier of (a) the date it shall be delivered to the address required by this Agreement; (b)
the date delivery shall have been refused at the address required by this Agreement; (c) with respect to notices sent by mail or overnight courier, the date as of which the Postal Service or overnight courier, as the case may be, shall have
indicated such notice to be undeliverable at the address required by this Agreement; or (d) with respect to a facsimile, the date on which the facsimile is sent and receipt of which is confirmed. Any and all notices referred to in this Agreement, or
which either party desires to give to the other, shall be addressed to the Executive’s residence in the case of the Executive, or to its principal office in the case of the Company. 
  
 20. Waiver of Breach. A waiver by the Company of a breach of any provision of this Agreement by the Executive shall not operate or be
construed as a waiver or estoppel of any subsequent breach by the Executive. No waiver shall be valid unless in writing and signed by an authorized officer of the Company. 
  

 8 

 21. Headings. The headings in this Agreement are inserted for convenience only and are not to be considered a
construction of the provisions hereof. 
  
 22. Severability. If any
provision of this Agreement shall be found invalid or unenforceable for any reason, in whole or in part, then such provision shall be deemed modified, restricted, or reformulated to the extent and in the manner necessary to render the same valid and
enforceable, or shall be deemed excised from this Agreement, as the case may require, and this Agreement shall be construed and enforced to the maximum extent permitted by law, as if such provision had been originally incorporated herein as so
modified, restricted, or reformulated or as if such provision had not been originally incorporated herein, as the case may be. The parties further agree to seek a lawful substitute for any provision found to be unlawful; provided, that, if the
parties are unable to agree upon a lawful substitute, the parties desire and request that a court or other authority called upon to decide the enforceability of this Agreement modify those restrictions in this Agreement that, once modified, will
result in an agreement that is enforceable to the maximum extent permitted by the law in existence at the time of the requested enforcement. 
  
 23. Successors. 
  
 (a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise
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. 
  
 (b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. 

 
 (c) The Company shall require any successor (whether direct or indirect,
by purchase, merger, reorganization, consolidation, acquisition of property or stock, liquidation, or otherwise) to all or a substantial portion of its assets, by agreement in form and substance reasonably satisfactory to the Executive, expressly to
assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform this Agreement if no such succession had taken place. Regardless of whether such an agreement is executed, this
Agreement shall be binding upon any successor of the Company in accordance with the operation of law, and such successor shall be deemed the “Company” for purposes of this Agreement. 
  
 (d) As used in this Agreement, the term “Company” shall include any
successor to the Company’s business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise. 
  
 24. Entire Agreement. This Agreement sets forth the entire and final agreement and understanding of the parties and contains all of the agreements made between the
parties with respect to the subject matter hereof. This Agreement supersedes any and all other agreements, either oral or in writing, between the parties hereto, with respect to the subject matter hereof. No change or modification of this Agreement
shall be valid unless in writing and signed by the Company and the Executive. 
  
 25. Survival. The obligations of the parties under Sections 7, 9, 11, 12, 13, 14, 16, 17, 22, 25 and 27 of this Agreement shall survive the termination of the Executive’s employment with the Company during the Period of
Agreement and the termination or expiration of the Period of Agreement. 
  
 26.
Counterparts. This Agreement may be executed in several counterparts, each of which shall be considered an original, but which when taken together, shall constitute one agreement. 
  
 27. Conflict. In the case of conflict between the terms of this Agreement (the “Agreement Terms”) and the provisions of any
plan, policy, or practice of the Company as in effect from time to time (the “Standard Provisions”), the Executive’s rights or the Company’s obligations shall be established by whichever of the Agreement Terms or Standard
Provisions would be more beneficial to the Executive. 
  
 [Signature Page Follows] 
  

 9 

 IN WITNESS WHEREOF, the parties have set their signatures as of the date first written above. 

 

									
	 COMPANY:
	 	 	 	 EXECUTIVE:

			
	 MCI, Inc.,
 a Delaware corporation
	 	 	 	 
			
	 	 	 	 	 
	 By:
	 	 	 	 	 	 	 	 
	 Its:
	 	 	 	 	 	 	 	 

  

 10 

 Appendix 1 
  
 OTHER COMPENSATION 
  
 There is no additional compensation for this Executive. 
  

 11 

 Appendix 2 
  
 GENERAL RELEASE 
  
 WHEREAS, the employment of the undersigned (“Executive”) is being terminated under circumstances making Executive eligible for severance
benefits under Section [9 or 13] of the Employment Agreement between Executive and MCI, Inc., effective as of                     , 2005 (the
“Employment Agreement”) and Executive wishes to receive the benefits described in Section [9 or 13] of the Employment Agreement, benefits to which Executive is not entitled unless Executive executes a general release and waiver of claims.

  
 NOW, THEREFORE, in consideration for the benefits described in
Section [9 or 13] of the Employment Agreement, Executive hereby releases and discharges MCI, Inc., and any subsidiaries or affiliates thereof (collectively the “Company”), and their respective directors, officers, employees, benefit plans
and administrators, successors and assigns from any and all claims, obligations, and liabilities, whether known or unknown, at law or in equity, arising out of Executive’s employment with the Company and the termination thereof. This Release is
to be broadly construed so as to resolve all pending or potential disputes including, but without limiting the generality of the foregoing, any and all claims under the Age Discrimination in Employment Act, as amended by the Older Workers Benefit
Protection Act of 1990, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Employee Retirement Income Security Act of 1974, the Equal Pay Act, the Family and Medical Leave Act, the discrimination and wage payment
laws of the state in which Executive rendered services to the Company, and any other statute, regulation, or ordinance, and any and all claims based upon alleged wrongful or retaliatory discharge, negligence, intentional infliction of emotional
distress, defamation, invasion of privacy, other torts, harassment, employment discrimination or breach of contract (express or implied). Notwithstanding the foregoing, Executive does not waive any rights Executive may have to enforce the terms of
Section [9 or 13] of the Employment Agreement, to benefits available after termination under any Company-sponsored employee benefit plan, to insurance protection and/or indemnification for actions taken by the Executive while an employee, officer
and/or director of the Company or to make any claims for workers’ compensation. 
  
 [Executive hereby expressly waives the benefit of California Civil Code Section 1542, which is set forth below, as well as any other statutory or common laws of like nature concerning the waiver of unknown claims, and
specifically agrees that this general release shall extend to claims arising out of transactions occurring prior to the date of its signing which the Executive does not know or expect to exist in the Executive’s favor at this time. California
Civil Code Section 1542 provides: 
  
 A general release does not
extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor.]1 
  
 Executive acknowledges and agrees that: 
  

	 	•	 	Executive has read and understands this Release in its entirety; 

  

	 	•	 	Executive has been advised in writing to consult with an attorney concerning this Release before signing it. This subparagraph constitutes such written advice;

  

	 	•	 	Executive has twenty-one (21) calendar days after receipt of this Release to consider its terms before signing it; 

  

	 	•	 	Executive has the right to revoke this Release in full within seven (7) calendar days of executing it. Any revocation must be personally delivered to Executive Vice
President—Human Resources, or [his/her] 

  

	1	Applicable to California residents. 

  

 12 

	 	 
designee, or mailed to MCI, Inc., [address], and postmarked within seven (7) calendar days of the date of execution of this Release. None of the terms and
provisions of this Release shall become effective or be enforceable until such revocation period has expired; 

  

	 	•	 	Nothing contained in this Release waives any claim that may arise after the date of its execution; and 

  

	 	•	 	Executive executes this Release knowingly and voluntarily, without duress or reservation of any kind, and after having given the matter full and careful consideration.

  
 IN WITNESS WHEREOF, the Executive has executed
this Release on the date indicated below and agrees to be bound hereby. 
  

	
	
	 
	 (Signature)

	
	 
	 (Print full name)

	
	 
	 (Date)

  

 13 

 Appendix 3 
  
 NON-DISCLOSURE, INTELLECTUAL PROPERTY ASSIGNMENT 
 AND NON-SOLICITATION AGREEMENT 
  
 In order for MCI and its operating affiliates and subsidiaries (hereinafter collectively referred to as the “Company”) to maintain a competitive edge, the Company must protect its confidential information
and customer relationships. 
  
 Therefore, as a condition of employment or
continued employment with the Company, I agree as follows: 
  
 DEFINITIONS 
  

	1.	“Confidential Information” means information (i) disclosed to or known by me as a consequence of my employment with the Company, (ii) not generally known to others outside
the Company, and (iii) which relates to the Company’s business. Confidential Information includes but is not limited to the Company’s trade secrets, equipment, equipment configuration, research, development efforts, methodologies, testing,
engineering, manufacturing, marketing, sales, finances, operations, processes, formulas, methods, techniques, devices, software programs, projections, strategies and plans, personnel information, industry contacts made during my employment, and
customer information, including customer needs, contacts, particular projects, and pricing. 

  

	2.	“Inventions” means any new or useful art, discovery, new contribution, finding or improvement, whether or not patentable, and all know-how related thereto, made, developed
or conceived by me (i) in the course of my employment, (ii) relating to the actual or anticipated business of the Company, or (iii) with the use of the Company’s time, material, information or facilities. 

  

	3.	“Works” means any materials for which copyright protection may be obtained, written, made, developed or conceived by me (i) in the course of my employment, (ii) relating
to the actual or anticipated business of the Company, or (iii) with the use of the Company’s time, material, information or facilities. 

  
 NONDISCLOSURE OF CONFIDENTIAL INFORMATION 
  

	4.	I will not disclose or use any Confidential Information for the benefit of myself or another, unless directed or authorized in writing by the Company to do so, or until such time as
the information becomes known to the public through no fault of mine. I will not disclose any Confidential Information to persons inside the Company who do not have a legitimate need to know the information. I will not make copies of Confidential
Information except as reasonably necessary to the performance of my duties for the Company. 

  

	5.	I understand that if I possess any proprietary information of another person or company as a result of prior employment or otherwise, the Company expects and requires that I will
honor any and all legal obligations that I have to that person or company with respect to proprietary information, and I will refrain from any unauthorized use or disclosure of such information. 

  
 RETURN OF COMPANY PROPERTY

  

	6.	All documents and other tangible property relating in any way to the business of the Company are the exclusive property of the Company (even if I authored or created them). I agree
to return all such documents and tangible property to the Company upon termination of employment or at such earlier time as the Company may request. 

  
 NON-SOLICITATION OF ACCOUNTS 
  

	7.	 During my employment with the Company and for one (1) year after termination of employment with the Company for any reason, I shall not directly or indirectly,
provide products or services that are materially 

  

 14 

	 	 
similar to the products or services provided by the Company to any customer of the Company with whom I had direct contact in the course of my employment with
the Company or about whom I learned Confidential Information as a result of my employment with the Company, nor will I solicit, induce, or attempt to induce such customers to: (a) stop doing business with or through the Company, or (b) do business
with any other person, firm, partnership, corporation or other entity that provides products or services materially similar to those provided by the Company. 

  
 NON-SOLICITATION OF EMPLOYEES 
  

	8.	During my employment and for one (1) year following termination of my employment with the Company for any reason, I shall not, directly or indirectly, assist in the hiring of, or
induce or attempt to induce any person who is employed by the Company or was employed by the Company within the prior six months to terminate his/her relationship with the Company or to accept employment or affiliation with any firm or entity of
which I am an employee, owner, partner or consultant. 

  
 DISCLOSURE AND ASSIGNMENT OF INVENTIONS AND WORKS 
  

	9.	I will promptly disclose to the Company in writing, all Inventions and Works which are conceived, made, discovered, written or created by me alone or jointly with someone else on
the Company’s time or on my own time, while I am employed by the Company. 

  

	10.	All Works created by me, alone or with others, shall be deemed “works made for hire” under the copyright laws and shall be owned by the Company. 

 

	11.	I hereby assign to the Company all of my rights in all Inventions, and in all Works to the extent such Works may not, by operation of law, be works made for hire.

  

	12.	I will, without further compensation, give the Company all assistance it reasonably requires (whether during my employment or after my employment) to perfect, protect, and use its
rights to Inventions and Works. In particular, I will sign all documents, do all things, and supply all information that the Company considers necessary or desirable to transfer or record the transfer of my entire right, title and interest in
Inventions and Works; and to enable the Company to obtain patent, copyright, or other legal protection for Inventions and Works. Any out-of-pocket expenses will be paid by the Company. 

  

	13.	An invention for which none of the Company’s equipment, supplies, facilities, or Confidential Information was used and which was developed entirely on my own time is exempted
from this Agreement so long as it: (1) does not relate in any way to the Company’s business, or to the Company’s actual or demonstrably anticipated research and development; and (b) does not result in any way from my work for the Company.

  

	14.	Also excluded from this Agreement are the following Inventions and Works which I own or control and which were conceived, made, written, or created by me prior to my employment with
the Company. 

  

			
	 (1)
	  	 
	
	 
		
	 (2)
	  	 
	
	 

  
 (Attach additional
sheets if necessary) 
  
 Other than these, I do not claim to own
or control rights in any inventions or works subject to copyright and will not assert any such rights against the Company. 
  

 15 

 IRREPARABLE HARM 
  

	15.	Irreparable harm would result from any breach by me of the provisions of this Agreement, and monetary damages alone would not provide adequate relief for any such breach.
Accordingly, if I breach or threaten to breach this Agreement, injunctive relief in favor of the Company is proper, without the necessity of the Company posting a bond. Moreover, any award of injunctive relief shall not preclude the Company from
seeking or recovering any lawful compensatory damages which may have resulted from a breach of this Agreement, including a forfeiture of any payments not yet made to me and a return of any payments already received by me. 

 
 SEVERABILITY/MODIFICATION 
  

	16.	If a provision of this Agreement is held invalid by a court of competent jurisdiction, the remaining provisions will nonetheless be enforceable according to their terms. Further, if
any provision is held to be over broad as written, a court may modify that provision to the extent necessary to make the provision enforceable according to applicable law and enforce the provision as modified. 

  
 GOVERNING LAW 
  

	17.	This Agreement shall be construed, interpreted and enforced in accordance with the internal laws of the State of Delaware. 

  
 BURDEN AND BENEFIT 
  

	18.	The Company may assign its rights under this Agreement to any successor in interest, whether by merger, consolidation, sale of assets, or otherwise. This Agreement shall be binding
whether it is between me and the Company or between me and any successor or assign of the Company. 

  
 NO EFFECT ON TERM OF EMPLOYMENT 
  

	19.	Nothing in this Agreement prevents or limits my right to terminate my employment at any time for any reason, and nothing in this Agreement prevents or limits the Company from
terminating my employment at any time for any reason. I understand and agree that there exist no promises or guarantees of permanent employment or employment for any specified term by the Company. 

  
 ENTIRE AGREEMENT 
  

	20.	I understand that this Agreement contains the entire agreement and understanding between the Company and me with respect to the provisions contained in this Agreement, and that no
representations, promises, agreements, or understandings, written or oral, related thereto which are not contained in this Agreement will be given any force or effect. No change or modification of this Agreement will be valid or binding unless it is
in writing and signed by the party against whom the change or modification is sought to be enforced. I further understand that even if the Company waives or fails to enforce any provision of this Agreement in one instance, that will not constitute a
waiver of any other provisions of this Agreement at this time, or a waiver of that provision at any other time. 

  
 ACKNOWLEDGEMENT 
  

	21.	I hereby acknowledge and represent that I have fully read and understand this Agreement and that I consider all of the terms of my covenants and agreements set forth in this
Agreement to be fair and reasonable and to be necessary to protect the Company’s ongoing interests. 

  

 16 

					
	COMPANY	 	 	 	EMPLOYEE
			
	  	 	 	 	  
	 By
	 	 	 	 Signature of Employee

			
	  	 	 	 	  
	 Title
	 	 	 	 Date

			
	  	 	 	 	  
	 Date
	 	 	 	 Address - Street

			
	  	 	 	 	  
	 	 	 	 	 Address - City, State, Zip Code

  

 17 

 Appendix 4 
  
 ETHICS PLEDGE 
  
 [Attached] 
  

 18

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