Document:

Exhibit 10.22

 

FIFTEENTH AMENDMENT

 

This
FIFTEENTH AMENDMENT, dated as of October 22, 2010 (this “Agreement”), to
the Debtor-in-Possession Credit Agreement, dated as of October 27, 2009 (as
amended prior to the date hereof, the “Credit Agreement”), by and among
FAIRPOINT COMMUNICATIONS, INC., a Delaware corporation and a debtor and
debtor-in-possession under Chapter 11 of the Bankruptcy Code (as hereinafter
defined) (“FairPoint”), FAIRPOINT LOGISTICS, INC., a South Dakota
corporation and a debtor and debtor-in-possession under Chapter 11 of the
Bankruptcy Code (“Logistics”; Logistics, together with FairPoint, each a
“Borrower” and, collectively, the “Borrowers”), the lenders from
time to time party thereto (the “Lenders”), and BANK OF AMERICA, N.A.,
as Administrative Agent (in such capacity, together with any successor
administrative agent, the “Administrative Agent”).  Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement.

 

WHEREAS,
the Borrowers have requested that the Administrative Agent and the Lenders
extend the Maturity Date.

 

NOW
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:

 

SECTION 1.   Amendments.  Subject to all of the terms and conditions
set forth herein (including the occurrence of the Effective Date referred to
below), and from and after such Effective Date:

 

1.1   Section 5.05(a)(i) of the Credit Agreement is hereby amended
by deleting the words “in compliance with Section 7.05” where they appear in
the parenthetical in such Section 5.05(a)(i).

 

1.2   Section 6.01(e) of the Credit Agreement is hereby amended
by deleting such Section 6.01(e) in its entirety and substituting in
lieu thereof the following new Section 6.01(e):

 

“(e)         Compliance
Certificates.  At the time of the
delivery of the financial statements provided for in Sections 6.01(b) or (c), a
certificate (“Compliance Certificate”) of the chief financial officer or
other Authorized Officer of FairPoint to the effect that no Default or Event of
Default exists or, if any Default or Event of Default does exist, specifying
the nature and extent thereof.”

 

1.3   Section 6.08 of the Credit Agreement is hereby amended by
deleting the words “, subject to Section 7.05,” where they appear in such Section
6.08.

 

1.4   Section 7.02(b) of the Credit Agreement is hereby amended
by deleting the words “to the extent within the limitations set forth in
Section 7.05” where they appear in such Section 7.02(b).

 

 

1.5   Section 7.04(c) of the Credit Agreement is hereby amended
by deleting the words “; provided that Borrowers are in compliance with Section
7.05” where they appear in such Section 7.04(c).

 

1.6   Each of Sections 7.05 and 7.12 of the Credit Agreement are
hereby deleted and replaced with “[Reserved].”

 

1.7   Section 8.22(b) of the Credit Agreement is hereby amended
by deleting the reference to “July 31, 2010” appearing therein and substituting
“January 31, 2011” therefor.

 

1.8   The definition of “Maturity Date” set forth in Section 9 of
the Credit Agreement is hereby amended and restated in its entirety to read as
follows:

 

“Maturity Date” shall
mean January 31, 2011, which date may, at the request of the Borrowers and
subject to the prior written consent of the Required Lenders, be extended from
time to time by up to two months in the aggregate (provided that the Credit
Parties shall not be required to pay a fee to the Lenders in connection with
any extensions for such up to two months in the aggregate).

 

SECTION 2.   Conditions
Precedent.  This Agreement shall
become effective on the date (the “Effective Date”) upon which the
following conditions have been satisfied:

 

(a)           The Administrative Agent shall have received executed
counterparts of this Agreement duly executed by the Credit Parties, the
Administrative Agent and each of the Lenders; and

 

(b)           The Administrative Agent shall have received (i) for the
ratable benefit of the Lenders, a fee in immediately available funds in an
amount equal to 0.50% of the Total Revolving Commitment, (ii) for its own
account, in immediately available funds (x) the full amount of its annual
administrative fee as if the anniversary of the date that the Interim Order was
entered by the Bankruptcy Court was the Effective Date and (y) payment in full
of all invoices heretofore submitted to FairPoint, and (iii) payment, or
counsel to the Administrative Agent shall have received payment, in full in
immediately available funds of all fees and expenses of counsel to the
Administrative Agent with respect to invoices heretofore submitted to
FairPoint.

 

SECTION 3.   Representations
and Warranties.  After giving effect
to this Agreement, the Credit Parties, jointly and severally, reaffirm and
restate the representations and warranties set forth in the Credit Agreement
and in the other Credit Documents (except to the extent such representations
and warranties expressly relate to an earlier date, in which case such
representations and warranties shall be true and correct in all material
respects as of such earlier date) and all such representations and warranties
shall be true and correct on the date hereof with the same force and effect as
if made on such date.  Each of the Credit
Parties represents and warrants (which representations and warranties shall
survive the execution and delivery hereof) to the Administrative Agent and the
Lenders that:

 

(a)           it has the company power and authority to execute, deliver
and carry out the terms and provisions of this Agreement and the transactions
contemplated hereby and 

 

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has taken or caused to be
taken all necessary action to authorize the execution, delivery and performance
of this Agreement and the transactions contemplated hereby;

 

(b)          no consent of any Person (including, without limitation,
any of its equity holders or creditors), and no action of, or filing with, any
governmental or public body or authority is required to authorize, or is
otherwise required in connection with, the execution, delivery and performance
of this Agreement;

 

(c)           this Agreement has been duly executed and delivered on its
behalf by a duly authorized officer, and constitutes its legal, valid and
binding obligation enforceable in accordance with its terms, subject to
bankruptcy, reorganization, insolvency, moratorium and other similar laws
affecting the enforcement of creditors’ rights generally and the exercise of
judicial discretion in accordance with general principles of equity;

 

(d)           no Default or Event of Default shall have occurred and be
continuing; and

 

(e)           the execution, delivery and performance of this Agreement
will not violate any law, statute or regulation, or any order or decree of any
court or governmental instrumentality, or conflict with, or result in the
breach of, or constitute a default under, any contractual obligation of any
Credit Party or any of its Subsidiaries.

 

SECTION 4.   Affirmation
of Credit Parties.  Each Credit Party
hereby approves and consents to this Agreement and the transactions
contemplated by this Agreement, and affirms its obligations under the Credit
Documents to which it is a party.  Each
Subsidiary Guarantor agrees and affirms that its guarantee of the Obligations
continues to be in full force and effect and is hereby ratified and confirmed
in all respects and shall apply to (i) the Credit Agreement and
(ii) all of the other Credit Documents, as each of such are amended
(including by this Agreement), restated, supplemented or otherwise modified
from time to time in accordance with their terms.  Each Credit Party expressly acknowledges and
agrees that further extensions, if any, of the Maturity Date (i) beyond January
31, 2011 may be subject to the inclusion of financial covenants and (ii) beyond
March 31, 2011 are subject to the discretion of and require the consent of all
Lenders and, in any event, would be subject to such terms and conditions
(including, without limitation, the payment of fees) as the Lenders may deem
appropriate under the circumstances.

 

SECTION 5.   Ratification.

 

(a)           Except as herein agreed, the Credit Agreement and the
other Credit Documents remain in full force and effect and are hereby ratified
and affirmed by the Credit Parties.  Each
of the Credit Parties hereby (i) confirms and agrees that the Borrowers are
truly and justly indebted to the Administrative Agent and the Lenders in the
aggregate amount of the Obligations without defense, counterclaim or offset of
any kind whatsoever, and (ii) reaffirms and admits the validity and
enforceability of the Credit Agreement and the other Credit Documents.

 

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(b)           This Agreement shall be limited precisely as written and,
except as expressly provided herein, shall not be deemed (i) to be a consent
granted pursuant to, or a waiver, modification or forbearance of, any term or
condition of the Credit Agreement or any of the instruments or agreements
referred to therein or a waiver of any Default or Event of Default under the
Credit Agreement, whether or not known to the Administrative Agent or any of
the Lenders, or (ii) to prejudice any right or remedy which the Administrative
Agent or any of the Lenders may now have or have in the future against any
Person under or in connection with the Credit Agreement, any of the instruments
or agreements referred to therein or any of the transactions contemplated
thereby.

 

SECTION 6.   Waivers;
Amendments.  Neither this Agreement,
nor any provision hereof, may be waived, amended or modified except pursuant to
an agreement or agreements in writing entered into by the Administrative Agent
and the Required Lenders.

 

SECTION 7.   References.  All references to the “Credit Agreement”, “thereunder”,
“thereof” or words of like import in the Credit Agreement or any other Credit
Document and the other documents and instruments delivered pursuant to or in
connection therewith shall mean and be a reference to the Credit Agreement as
modified hereby and as each may in the future be amended, restated,
supplemented or modified from time to time.

 

SECTION 8.   Counterparts.  This Agreement may be executed by the parties
hereto individually or in combination, in one or more counterparts, each of
which shall be an original and all of which shall constitute one and the same
agreement.  Delivery of an executed
counterpart of a signature page by telecopier shall be effective as delivery of
a manually executed counterpart.

 

SECTION 9.   Successors
and Assigns.  The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns.

 

SECTION 10.   Severability.  If any provision of this Agreement shall be
held invalid or unenforceable in whole or in part in any jurisdiction, such
provision shall, as to such jurisdiction, be ineffective to the extent of such
invalidity or enforceability without in any manner affecting the validity or
enforceability of such provision in any other jurisdiction or the remaining
provisions of this Agreement in any jurisdiction.

 

SECTION 11.   Governing
Law.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK.

 

SECTION 12.   Miscellaneous.

 

(a)   The parties hereto shall, at any time from time to time following
the execution of this Agreement, execute and deliver all such further
instruments and take all such further action as may be reasonably necessary or
appropriate in order to carry out the provisions of this Agreement.

 

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(b)   The Credit Parties acknowledge and agree that this Agreement
constitutes a Credit Document and that the failure of any of the Credit Parties
to comply with the provisions of this Agreement shall constitute an Event of
Default.

 

SECTION 13.   Headings.  Section headings in this Agreement are
included for convenience of reference only and are not to affect the
construction of, or to be taken into consideration in interpreting, this
Agreement.

 

[The remainder of this page left blank intentionally]

 

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[Signature Pages Omitted]Exhibit
10.27

 

Execution
Copy

 

EMPLOYMENT AGREEMENT

 

This
EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as
of this 16th day of August 2010, by and between FairPoint Communications, Inc.,
a Delaware corporation, and Paul H. Sunu (the “Employee”).

 

W I T N E S S E T H :

 

WHEREAS,
the Company desires to employ Employee and to enter into this Agreement
embodying the terms of such employment, and Employee desires to enter into this
Agreement and to accept such employment, subject to the terms and provisions of
this Agreement.

 

NOW,
THEREFORE, in consideration of the promises and mutual covenants contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are mutually acknowledged, the Company and Employee hereby
agree as follows:

 

Section 1.               Definitions.

 

(a)           “Accrued Obligations” shall mean (i) all
accrued but unpaid Base Salary through the date of termination of Employee’s
employment, (ii) any unpaid or unreimbursed expenses incurred in
accordance with Section 7 hereof, and (iii) any benefits provided
under the Company’s employee benefit plans upon a termination of employment, in
accordance with the terms contained therein.

 

(b)           “Agreement” shall have the meaning set
forth in the preamble hereto.

 

(c)           “Annual Bonus” shall have the meaning
set forth in Section 4(b) hereof.

 

(d)           “Bankruptcy Court” shall mean the
United States Bankruptcy Court for the Southern District of New York.

 

(e)           “Base Salary” shall mean the salary
provided for in Section 4(a) hereof or any increased salary granted
to Employee pursuant to Section 4(a) hereof.

 

(f)            “Board” shall mean the Board of
Directors of the Company or the Board of Directors of Reorganized FairPoint, as
defined in the Plan, as applicable.

 

(g)           “Cause” shall mean (i) Employee’s
act(s) of gross negligence or willful misconduct in the course of Employee’s
employment hereunder, including a failure to follow a material lawful directive
from the Board, (ii) willful failure or refusal by Employee to perform in
any material respect his duties or responsibilities,
(iii) misappropriation (or attempted misappropriation) by Employee of any
assets or business opportunities of the Company or any other member of the
Company Group, (iv) embezzlement or fraud committed (or attempted) by
Employee, or at his direction, (v) Employee’s conviction of, indictment
for, or pleading “guilty” or “ no contest” to, (x) a felony or
(y) any other criminal charge that has, or could be reasonably expected to
have, an adverse impact on the performance of Employee’s duties to the Company
or any other member of the Company Group or otherwise result in material injury
to the reputation

 

 

or business of the
Company or any other member of the Company Group, (vi) any material
violation by Employee of the policies of the Company, including but not limited
to those relating to sexual harassment or business conduct, and those otherwise
set forth in the manuals or statements of policy of the Company, which
violation has a material adverse effect on the Company, or (vii) Employee’s
material breach of this Agreement or material breach of the Non-Interference
Agreement.

 

(h)           “Change in Control” shall mean

 

(i)            a change in ownership or control of the Company effected through a
transaction or series of transactions (other than an offering of Stock to the
general public through a registration statement filed with the Securities and
Exchange Commission) whereby any “person” (as defined in Section 3(a)(9) of
the Exchange Act) or any two or more persons deemed to be one “person” (as used
in Sections 13(d)(3) and 14(d)(2) of the Exchange Act), other
than the Company or any of its affiliates, or an employee benefit plan
maintained by the Company or any of its affiliates, directly or indirectly
acquire “beneficial ownership” (within the meaning of Rule 13d-3 under the
Exchange Act) of securities of the Company possessing more than fifty percent
(50%) of the total combined voting power of the Company’s securities
outstanding immediately after such acquisition;

 

(ii)           at any time following the Effective Date, the date upon which less than a
majority of the Board is made up of the initial members of the Board of
Reorganized FairPoint; provided, however,
that any individual becoming a director subsequent to the Effective Date whose election,
or nomination for election by the Company’s stockholders, was approved by a
vote of at least a majority of the directors then constituting the Board shall
be considered as though such individual were an initial member of the Board of
Reorganized FairPoint, but excluding, for this purpose, any such individual
whose initial assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents by
or on behalf of a person other than the Board; or

 

(iii)          the sale or disposition, in one or a series of related transactions, of
all or substantially all of the assets of the Company to any “person” (as
defined in Section 3(a)(9) of the Exchange Act) or to any two or more
persons deemed to be one “person” (as used in Sections 13(d)(3) and
14(d)(2) of the Exchange Act) other than the Company’s affiliates.

 

For
purposes of clarification, the Company’s emergence from bankruptcy pursuant to
the Plan shall not constitute a Change in Control under this Agreement.

 

(i)            “Code” shall mean the Internal Revenue
Code of 1986, as amended, and the rules and regulations promulgated
thereunder.

 

(j)            “Commencement Date” shall mean the date
Employee commences his employment with the Company, such date to be mutually
agreed upon by the parties hereto,

 

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provided that such date
shall be not earlier than the date on which Bankruptcy Court approval is
received for both this agreement and the consulting agreement being proposed
between the Company and Mr. David Hauser.

 

(k)           “Company” shall mean FairPoint
Communications, Inc., a Delaware corporation, and provided that the
Effective Date occurs, Reorganized FairPoint.

 

(l)            “Company Group” shall mean the Company
together with any direct or indirect subsidiaries of the Company.

 

(m)          “Compensation Committee” shall mean the
committee of the Board designated to make compensation decisions relating to
senior executive officers of the Company Group. 
Prior to any time that such a committee has been designated, the Board
shall be deemed the Compensation Committee for purposes of this Agreement.

 

(n)           “Delay Period” shall have the meaning
set forth in Section 13(a) hereof.

 

(o)           “Disability” shall mean any physical or
mental disability or infirmity of Employee that prevents the performance of
Employee’s duties for a period of (i) ninety (90) consecutive days or
(ii) one hundred twenty (120) non-consecutive days during any twelve (12)
month period.  Any question as to the
existence, extent, or potentiality of Employee’s Disability upon which Employee
and the Company cannot agree shall be determined by a qualified, independent
physician selected by the Company and approved by Employee (which approval
shall not be unreasonably withheld).  The
determination of any such physician shall be final and conclusive for all
purposes of this Agreement.

 

(p)           “Effective Date” shall have the meaning
given to it in the Plan.

 

(q)           “Employee” shall have the meaning set
forth in the preamble hereto.

 

(r)            “Exchange Act” shall mean the
Securities Exchange Act of 1934, as amended from time to time, including rules thereunder
and successor provisions and rules thereto.

 

(s)           “Good Reason” shall mean, without
Employee’s consent, (i) a material diminution in Employee’s title, duties,
or responsibilities as set forth in Section 3 hereof, (ii) a material
reduction in Base Salary set forth in Section 4(a) hereof or Annual
Bonus opportunity set forth in Section 4(b) hereof, (iii) the
relocation of Employee’s principal place of employment (as provided in Section 3(c) hereof)
more than fifty (50) miles from its current location, or (iv) any other
material breach of a provision of this Agreement by the Company (other than a
provision that is covered by clause (i), (ii), or (iii) above).  Employee acknowledges and agrees that his
exclusive remedy in the event of any breach of this Agreement shall be to
assert Good Reason pursuant to the terms and conditions of Section 8(e) hereof.
Notwithstanding the foregoing, during the Term of Employment, in the event that
the Board reasonably believes that Employee may have engaged in conduct that
could constitute Cause hereunder, the Board may, in its sole and absolute discretion,
suspend Employee from performing his duties hereunder, and in no event shall
any such suspension constitute an event pursuant to which Employee may
terminate employment with Good Reason or otherwise constitute a breach
hereunder; provided,

 

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that no such suspension
shall alter the Company’s obligations under this Agreement during such period
of suspension.

 

(t)            “Non-Extension Notice” shall have the
meaning set forth in Section 2 hereof.

 

(u)           “Non-Interference Agreement” shall mean
the Confidentiality, Non-Interference, and Invention Assignment Agreement
attached hereto as Exhibit A.

 

(v)           “Option” shall have the meaning set
forth in Section 4(d) hereof.

 

(w)          “Person” shall mean any individual,
corporation, partnership, limited liability company, joint venture,
association, joint-stock company, trust (charitable or non-charitable),
unincorporated organization, or other form of business entity.

 

(x)            “Plan” shall mean the Debtors’ Modified
Second Amended Joint Plan of Reorganization filed in the Bankruptcy Court.

 

(y)           “Release of Claims” shall mean the
Release of Claims in substantially the same form attached hereto as Exhibit B
(as the same may be revised from time to time by the Company upon the advice of
counsel).

 

(z)            “Reorganized FairPoint” shall have the
meaning set forth in the Plan.

 

(aa)         “Restricted Shares” shall have the
meaning set forth in Section 4(d) hereof.

 

(bb)         “Severance Benefits” shall have the
meaning set forth in Section 8(g) hereof.

 

(cc)         “Severance Term” shall mean the twelve
(12) month period following Employee’s death or termination due to Disability,
or the twenty-four (24) month period following Employee’s termination by the
Company without Cause (other than by reason of death or Disability) or by
Employee for Good Reason, as applicable.

 

(dd)         “Stock” shall mean the New Common
Stock, as defined in the Plan.

 

(ee)         “Term of Employment” shall mean the
period specified in Section 2 hereof.

 

Section 2.               Acceptance and Term of Employment.

 

The
Company agrees to employ Employee, and Employee agrees to serve the Company, on
the terms and conditions set forth herein. 
The Term of Employment shall commence on the Commencement Date and,
subject to the approval of this Agreement by the Bankruptcy Court, shall
continue during the period ending on the close of business of the three (3) year
anniversary of the Effective Date, unless terminated sooner as provided in Section 8;
provided, however,
that the Term of Employment shall be extended automatically for successive

 

4

 

one
(1) year terms, without the requirement of any action on the part of
either party unless notice of termination (a “Non-Extension Notice”)
is given by either the Company or Employee not less than ninety (90) days prior
to the expiration of the Term of Employment (including any extension thereof).

 

Section 3.               Position, Duties, and Responsibilities; Place of Performance.

 

(a)           Position, Duties, and Responsibilities. 
During the Term of Employment, Employee shall be employed and serve as
the Chief Executive Officer of the Company (together with such other position
or positions consistent with Employee’s title as the Board shall specify from
time to time), shall be elected to and shall serve as a member of the Board,
and shall have such duties and responsibilities commensurate with such
title.  Employee also agrees to serve as
an officer and/or director of any other member of the Company Group, in each
case without additional compensation.

 

(b)           Performance.  Employee
shall devote his full business time, attention, skill, and best efforts to the
performance of his duties under this Agreement and shall not engage in any
other business or occupation during the Term of Employment, including, without
limitation, any activity that (x) conflicts with the interests of the
Company or any other member of the Company Group, (y) interferes with the
proper and efficient performance of Employee’s duties for the Company, or
(z) interferes with Employee’s exercise of judgment in the Company’s best
interests.  Notwithstanding the
foregoing, nothing herein shall preclude Employee from (i) continuing to
serve until either (I) the Effective Date or (II) the effective date
of a plan of reorganization of the Company under the Bankruptcy Code on one
board of directors other than the Company’s Board (each such board that is not
the Company’s Board, an “Outside Board”), except that during the 30 day
period from the date of Employee’s appointment to an Outside Board which
results in Employee serving on more than one Outside Board, Employee will be
permitted to serve on more than one Outside Board but will be required
to resign from the requisite number of Outside Boards such that he is only
serving on one Outside Board within 30 days of his appointment to the
Outside Board that results in his violation of the foregoing restriction, or
otherwise serving, with the prior written consent of the Board, as a member of
the boards of directors or advisory boards (or their equivalents in the case of
a non-corporate entity) of non-competing businesses and charitable
organizations, (ii) finalizing transition services with Hargray
Communications Group, Inc. prior to initiation of full time employment
with the Company, (iii) engaging in charitable activities and community
affairs, and (iv) managing his personal investments and affairs; provided, however,
that the activities set out in clauses (i), (iii) and (iv) shall be
limited by Employee so as not to materially interfere, individually or in the
aggregate, with the performance of his duties and responsibilities hereunder.

 

(c)           Principal Place of Employment. 
Employee’s principal place of employment shall be in Charlotte, North
Carolina, although Employee understands and agrees that he may be required to
travel from time to time for business reasons.

 

Section 4.               Compensation.

 

During
the Term of Employment, Employee shall be entitled to the following
compensation:

 

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(a)           Base Salary.  Employee
shall be paid an annualized Base Salary, payable in accordance with the regular
payroll practices of the Company, of not less than $750,000, with increases, if
any, as may be approved in writing by the Compensation Committee.

 

(b)           Annual Bonus.  Beginning
with calendar year 2011, Employee shall be eligible for an annual incentive
bonus award (the “Annual Bonus”) through participation in the
Company’s Annual Incentive Plan in respect of each fiscal year during the Term
of Employment (at the maximum level, up to 150% of Base Salary), with the
actual Annual Bonus payable being based upon the level of achievement of annual
Company and individual performance objectives for such fiscal year, as
determined by the Compensation Committee and communicated to Employee.  The Annual Bonus shall be paid to Employee at
the same time as annual bonuses are generally payable to other senior
executives of the Company subject to Employee’s continuous employment through
the payment date.

 

(c)           Signing Bonus; Relocation Expenses.

 

(i)            In connection with the commencement of Employee’s employment with the
Company, the Company shall pay to Employee a one-time signing bonus equal to
$500,000.  The signing bonus shall be
paid no later than the Company’s first regular payroll date following the
Commencement Date.

 

(ii)           In connection with the relocation of Employee’s principal residence in
Chapel Hill, North Carolina, the Company will reimburse Employee for reasonable
relocation expenses (including any travel expenses incurred by Employee in
connection with, but prior to, the commencement of his employment).  To the extent the reimbursement provided
under this Section 4(c)(i) is considered income and increases
Employee’s income tax liability, the Company shall pay Employee a tax reimbursement
payment in an amount such that, after deduction for all income taxes payable
with respect to such tax reimbursement benefit, the amount retained by Employee
will be equal to the amount of such increased income tax liability; provided, that in no event shall the
aggregate amount of any reimbursed income tax liability exceed $100,000.  Such expenses will be reimbursed in
accordance with the Company’s regular reimbursement policies, and any related
tax reimbursement shall be made no later than the last day of the calendar year
next following the calendar year in which Employee remits to the applicable
taxing authority such taxes being reimbursed.

 

(d)           Equity.  Following
the Effective Date, Employee shall be granted 240,000 shares of Stock (the “Restricted
Shares”) and options to purchase 250,000 shares of Stock (the “Options”).  The Restricted Shares and the Options shall
be adjusted on the date of grant to reflect the percentage of the Company such
amounts reflect as of the Commencement Date, on a fully diluted basis, and
shall be subject to such terms and conditions as determined by the Company, as
set forth in the Company’s final Long-Term Incentive Plan (“LTIP”) that
shall be in effect upon the Effective Date or immediately thereafter (which for
purposes of clarification, may contain revisions, approved by the Company’s
Board, as compared to the Company’s 2010 Long-Term Incentive Plan that was
filed with the Bankruptcy Court). 
Twenty-five percent (25%) of each of the Restricted Shares and the
Options shall be vested as of the date of grant, and the remaining Restricted
Shares and Options shall vest thereafter in three (3) substantially

 

6

 

equal vesting tranches on
each of the first three (3) anniversaries of the Effective Date, subject
to Employee’s continued employment with the Company through each such vesting
date.  The strike price of the Options
shall be set by the LTIP but shall be no less than the fair market value of the
Stock on the date of grant, as determined by the Compensation Committee in good
faith in a manner consistent with the exemption from Section 409A of the
Code provided under Treasury Regulation 1.409A-1(b)(5) with respect
to “stock rights.”  Notwithstanding
anything to the contrary in the LTIP or award agreement relating to the
Restricted Shares or the Options, 100% of the available unvested Restricted
Shares and the Options shall vest, to the extent not yet vested or expired,
upon the consummation of a Change in Control so long as Employee remains
employed by the Company at the time of execution of a definitive agreement with
respect to such Change in Control.

 

(e)           Success Bonus Plan. 
Employee shall participate in the Company’s 2010 Success Bonus Plan,
pursuant to the terms thereof, with a success bonus equal to fifty percent
(50%) of Employee’s annual Base Salary if the Company performs at Target
performance levels, as such Target is defined under the 2010 Success Bonus Plan
approved by the Bankruptcy Court.

 

(f)            Indemnification.  The
Company shall indemnify Employee and hold Employee harmless in connection with
the defense of any lawsuit or other claim to which he is made a party by reason
of being an officer or employee of the Company, to the fullest extent permitted
by the laws of the State of Delaware, as in effect at the time of the subject
act or omission; provided that
any settlement, consent to judgment, or similar action taken by Employee
without the prior written consent of the Company in respect of any such lawsuit
or other claim shall not be subject to indemnification hereunder.  In addition, the Company shall provide
Employee with evidence of Directors and Officers insurance covering Employee at
all times beginning with the date upon which Employee first provides services to
the Company, whether such services are performed under this Agreement or in
preparation for Employee’s service to the Company under this Agreement, and
such insurance coverage shall remain in force for not less than six (6) years
subsequent to the termination of Employee’s employment with the Company.

 

Section 5.               Employee Benefits.

 

During
the Term of Employment, Employee shall be entitled to participate in health,
insurance, retirement, and other benefits provided generally to similarly
situated employees of the Company. 
Employee shall also be entitled to the same number of holidays, vacation
days, and sick days, as well as any other benefits, in each case as are
generally allowed to similarly situated employees of the Company in accordance
with the Company policy as in effect from time to time.  Nothing contained herein shall be construed
to limit the Company’s ability to amend, suspend, or terminate any employee
benefit plan or policy at any time without providing Employee notice, and the
right to do so is expressly reserved.

 

Section 6.               Key-Man Insurance.

 

At any time during the Term of Employment, the Company
shall have the right to insure the life of Employee for the sole benefit of the
Company, in such amounts, and with such terms, as it may determine.  All premiums payable thereon shall be the
obligation of the

 

7

 

Company.  Employee
shall have no interest in any such policy, but agrees to cooperate with the
Company in procuring such insurance by submitting to physical examinations,
supplying all information required by the insurance company, and executing all
necessary documents, provided that no financial obligation is imposed on
Employee by any such documents.

 

Section 7.               Reimbursement of Business Expenses.

 

Employee
is authorized to incur reasonable business expenses in carrying out his duties
and responsibilities under this Agreement, and the Company shall promptly
reimburse him for all such reasonable business expenses, subject to
documentation in accordance with the Company’s policy, as in effect from time
to time.

 

Section 8.               Termination of Employment.

 

(a)           General.  The Term
of Employment shall terminate upon the earliest to occur of (i) Employee’s
death, (ii) a termination by reason of a Disability, (iii) a
termination by the Company with Cause or by Reorganized FairPoint with or
without Cause, (iv) a termination by Employee with or without Good Reason,
and (v) the close of business on the last day of the Term of Employment
following delivery of a Non-Extension Notice. 
Upon any termination of Employee’s employment for any reason, except as
may otherwise be requested by the Company in writing and agreed upon in writing
by Employee, Employee shall resign from any and all directorships, committee
memberships, and any other positions Employee holds with the Company or any
other member of the Company Group. 
Notwithstanding anything herein to the contrary, the payment (or
commencement of a series of payments) hereunder of any nonqualified deferred
compensation (within the meaning of Section 409A of the Code) upon a
termination of employment shall be delayed until such time as Employee has also
undergone a “separation from service” as defined in Treas.
Reg. 1.409A-1(h), at which time such nonqualified deferred compensation
(calculated as of the date of Employee’s termination of employment hereunder)
shall be paid (or commence to be paid) to Employee on the schedule set forth in
this Section 8 as if Employee had undergone such termination of employment
(under the same circumstances) on the date of his ultimate “separation from
service.”

 

(b)           Termination Due to Death or Disability. 
Employee’s employment shall terminate automatically upon his death.  The Company may terminate Employee’s
employment immediately upon the occurrence of a Disability, such termination to
be effective upon Employee’s receipt of written notice of such
termination.  Upon Employee’s death or in
the event that Employee’s employment is terminated due to his Disability,
Employee or his estate or his beneficiaries, as the case may be, shall be
entitled to:

 

(i)            The Accrued Obligations;

 

(ii)           Any unpaid Annual Bonus in respect of any completed fiscal year that has
ended prior to the date of such termination, which amount shall be paid at such
time annual bonuses are paid to other senior executives of the Company, but in
no event later than the date that is 21⁄2 months following the last day of the
fiscal year in which such termination occurred; and

 

8

 

(iii)          An amount equal to the sum of (x) Employee’s then-current Base
Salary, (y) Employee’s Annual Bonus for the immediately preceding fiscal
year (or in the event such termination occurs prior to the payment of Employee’s
Annual Bonus for 2011, if any, an amount equal to $750,000), and (z) the
cost of continued health and disability insurance coverage for Employee and his
covered dependents during the Severance Term, based on the monthly cost of
continuation coverage under COBRA as of the date of termination, as applicable,
under the applicable Company benefit plans, such amount to be paid in
substantially equal installments during the Severance Term in accordance with
Reorganized FairPoint’s regular payroll practices.

 

Following
Employee’s death or a termination of Employee’s employment by reason of a
Disability, except as set forth in this Section 8(b), Employee shall have
no further rights to any compensation or any other benefits under this
Agreement.

 

(c)           Termination by the Company with Cause.

 

(i)            The Company may terminate Employee’s employment at any time with Cause,
effective upon Employee’s receipt of written notice of such termination; provided, however, that (x) with
respect to any Cause termination relying on clause (i) of the definition
of Cause set forth in Section 1(g) hereof, to the extent that such
act or acts or failure or failures to act are curable, Employee shall be given
not less than three (3) days’ written notice by the Board of its intention
to terminate him with Cause, or (y) with respect to any Cause termination
relying on clause (ii) or (vii) of the definition of Cause set forth
in Section 1(g) hereof, to the extent that such act or acts or
failure or failures to act are curable, Employee shall be given not less than
ten (10) days’ written notice by the Board of its intention to terminate
him with Cause, and with respect to each of clauses (x) and (y) hereof
such notice to state in detail the particular act or acts or failure or
failures to act that constitute the grounds on which the proposed termination
with Cause is based, and such termination shall be effective at the expiration
of such three (3) day or ten (10) day notice period, as the case may
be under clause (x) or (y) respectively, unless Employee has fully
cured such act or acts or failure or failures to act that give rise to Cause
during such period.

 

(ii)           In the event that the Company terminates Employee’s employment with
Cause, he shall be entitled only to the Accrued Obligations.  Following such termination of Employee’s
employment with Cause, except as set forth in this Section 8(c)(ii),
Employee shall have no further rights to any compensation or any other benefits
under this Agreement.

 

(d)           Termination by Reorganized FairPoint without
Cause or upon Expiration of the Term of Employment Following the Company’s
Delivery of a Non-Extension Notice. 
Reorganized FairPoint may terminate Employee’s employment at any time
without Cause, effective upon Employee’s receipt of written notice of such
termination, or by delivery to Employee of a Non-Extension Notice in accordance
with the provisions of Section 2 above. 
In the event that Employee’s employment is terminated by Reorganized
FairPoint without Cause

 

9

 

(other than due to death
or Disability) or upon the expiration of the Term of Employment following the
Company’s delivery of a Non-Extension Notice, Employee shall be entitled to:

 

(i)            The Accrued Obligations;

 

(ii)           Any unpaid Annual Bonus in respect of any completed fiscal year that has
ended prior to the date of such termination, which amount shall be paid at such
time annual bonuses are paid to other senior executives of Reorganized
FairPoint, but in no event later than the date that is 21⁄2 months following the
last day of the fiscal year in which such termination occurred; and

 

(iii)          An amount equal to the sum of (x) two times the amount of Employee’s
then-current Base Salary, (y) two times the amount of Employee’s Annual
Bonus for the immediately preceding fiscal year (or in the event such
termination occurs prior to the payment of Employee’s Annual Bonus for 2011, if
any, an amount equal to $1,500,000), and (z) the cost of continued health
and disability insurance coverage for Employee and his covered dependents
during the Severance Term, based on the monthly cost of continuation coverage
under COBRA as of the date of termination, as applicable, under the applicable
Company benefit plans, such amount to be paid in substantially equal
installments during the Severance Term in accordance with Reorganized FairPoint’s
regular payroll practices.

 

Notwithstanding
the foregoing, the payments and benefits described in clauses (ii) and (iii) above
shall immediately terminate, and Reorganized FairPoint shall have no further
obligations to Employee with respect thereto, in the event that Employee
breaches any material provision of the Non-Interference Agreement.  Following such termination of Employee’s
employment by Reorganized FairPoint without Cause or upon the expiration of the
Term of Employment following the Company’s delivery of a Non-Extension Notice,
except as set forth in this Section 8(d), Employee shall have no further
rights to any compensation or any other benefits under this Agreement.  For the avoidance of doubt, Employee’s sole
and exclusive remedy upon a termination of employment by Reorganized FairPoint
without Cause or upon the expiration of the Term of Employment following the
Company’s delivery of a Non-Extension Notice shall be receipt of the Severance
Benefits.

 

(e)           Termination by Employee with Good Reason. 
Employee may terminate his employment with Good Reason by providing the
Company ten (10) days’ written notice setting forth in reasonable
specificity the event that constitutes Good Reason, which written notice, to be
effective, must be provided to the Company within sixty (60) days of the
occurrence of such event.  During such
ten (10) day notice period, the Company shall have a cure right (if
curable), and if not cured within such period, Employee’s termination will be
effective upon the expiration of such cure period, and Employee shall be
entitled to the same payments and benefits as provided in Section 8(d) hereof
for a termination by the Company without Cause, subject to the same conditions
on payment and benefits as described in Section 8(d) hereof.  Following such termination of Employee’s
employment by Employee with Good Reason, except as set forth in this Section 8(e),
Employee shall have no further rights to any compensation or any other benefits
under this Agreement.  For the avoidance
of doubt, Employee’s sole and exclusive

 

10

 

remedy upon a termination
of employment with Good Reason shall be receipt of the Severance Benefits.

 

(f)            Termination by Employee without Good Reason or
upon the Expiration of the Term of Employment following Employee’s Delivery of
a Non-Extension Notice.  Employee may terminate his
employment without Good Reason by providing the Company thirty (30) days’ written
notice of such termination or by delivery of a Non-Extension Notice in
accordance with the provisions of Section 2 above.  In the event of a termination of employment
by Employee under this Section 8(f), Employee shall be entitled only to
the Accrued Obligations.  In the event of
termination of Employee’s employment without Good Reason, the Company may, in
its sole and absolute discretion, by written notice accelerate such date of
termination without changing the characterization of such termination as a
termination by Employee without Good Reason. 
Following such termination of Employee’s employment by Employee without
Good Reason or upon the expiration of the Term of Employment following Employee’s
delivery of a Non-Extension Notice, except as set forth in this Section 8(f),
Employee shall have no further rights to any compensation or any other benefits
under this Agreement.  Notwithstanding
anything in this Section 8(f) to the contrary, in the event Employee
provides the Company with notice of his termination of employment without Good
Reason during the thirteenth (13th) calendar month following the consummation of
a Change in Control, such termination shall be deemed a termination with Good
Reason for all purposes of this Agreement, and Employee shall be entitled to
receive the payments and benefits as provided in Section 8(e) hereof
for a termination by Employee with Good Reason, subject to the same conditions
on payment and benefits as described in Section 8(e) hereof.

 

(g)           Release. 
Notwithstanding any provision herein to the contrary, the payment of any
amount or provision of any benefit pursuant to subsection (b), (d), or (e) of
this Section 8 (other than the Accrued Obligations) (collectively, the “Severance
Benefits”) shall be conditioned upon Employee’s execution, delivery to the
Company, and non-revocation of the Release of Claims (and the expiration of any
revocation period contained in such Release of Claims) within sixty (60) days
following the date of Employee’s termination of employment hereunder.  If Employee fails to execute the Release of
Claims in such a timely manner so as to permit any revocation period to expire
prior to the end of such sixty (60) day period, or timely revokes his
acceptance of such release following its execution, Employee shall not be
entitled to any of the Severance Benefits. 
Further, to the extent that any of the Severance Benefits constitutes “nonqualified
deferred compensation” for purposes of Section 409A of the Code, any
payment of any amount or provision of any benefit otherwise scheduled to occur
prior to the sixtieth (60th) day following the date of Employee’s
termination of employment hereunder, but for the condition on executing the
Release of Claims as set forth herein, shall not be made until the first regularly
scheduled payroll date following such sixtieth (60th) day, after which any remaining Severance
Benefits shall thereafter be provided to Employee according to the applicable
schedule set forth herein.  For the
avoidance of doubt, in the event of a termination due to Employee’s death or
Disability, Employee’s obligations herein to execute and not revoke the Release
of Claims may be satisfied on his behalf by his estate or a person having legal
power of attorney over his affairs.

 

11

 

Section 9.               Non-Interference Agreement.

 

As
a condition of, and prior to commencement of, Employee’s employment with the
Company, Employee shall have executed and delivered to the Company the
Non-Interference Agreement.  The parties
hereto acknowledge and agree that this Agreement and the Non-Interference
Agreement shall be considered separate contracts.

 

Section 10.             Representations and Warranties of Employee.

 

Employee
represents and warrants to the Company that—

 

(a)           Employee is entering into this Agreement
voluntarily and that his employment hereunder and compliance with the terms and
conditions hereof will not conflict with or result in the breach by him of any
agreement to which he is a party or by which he may be bound;

 

(b)           Employee has not violated, and in connection
with his employment with the Company will not violate, any non-solicitation,
non-competition, or other similar covenant or agreement of a prior employer by
which he is or may be bound; and

 

(c)           in connection with his employment with the
Company, Employee will not use any confidential or proprietary information he
may have obtained in connection with employment with any prior employer.

 

Section 11.             Taxes.

 

The
Company may withhold from any payments made under this Agreement all applicable
taxes, including but not limited to income, employment, and social insurance
taxes, as shall be required by law. 
Employee acknowledges and represents that the Company has not provided any
tax advice to him in connection with this Agreement and that he has been
advised by the Company to seek tax advice from his own tax advisors regarding
this Agreement and payments that may be made to him pursuant to this Agreement,
including specifically, the application of the provisions of Section 409A
of the Code to such payments.

 

Section 12.             Mitigation; Company Recovery Rights.

 

Employee
shall not be required to mitigate the amount of any payment provided pursuant
to this Agreement by seeking other employment or otherwise, and the amount of
any payment provided for pursuant to this Agreement shall not be reduced by any
compensation earned as a result of Employee’s other employment or
otherwise.  Any payment pursuant to this
Agreement shall, however, be subject to any rights that the Company may
have under Section 304(b) of the Sarbanes-Oxley Act of 2002, and
Section 957 of the Dodd-Frank Wall Street Reform and Consumer Protection
Act.

 

Section 13.             Additional Section 409A Provisions.

 

Notwithstanding
any provision in this Agreement to the contrary—

 

12

 

(a)           Any payment otherwise required to be made
hereunder to Employee at any date as a result of the termination of Employee’s
employment shall be delayed for such period of time as may be necessary to meet
the requirements of Section 409A(a)(2)(B)(i) of the Code (the “Delay
Period”).  On the first business day
following the expiration of the Delay Period, Employee shall be paid, in a
single cash lump sum, an amount equal to the aggregate amount of all payments
delayed pursuant to the preceding sentence, and any remaining payments not so
delayed shall continue to be paid pursuant to the payment schedule set forth
herein.

 

(b)           Each payment in a series of payments hereunder
shall be deemed to be a separate payment for purposes of Section 409A of
the Code.

 

(c)           To the extent that any right to reimbursement
of expenses or payment of any benefit in-kind under this Agreement constitutes
nonqualified deferred compensation (within the meaning of Section 409A of
the Code), (i) any such expense reimbursement shall be made by the Company
no later than the last day of the taxable year following the taxable year in
which such expense was incurred by Employee, (ii) the right to
reimbursement or in-kind benefits shall not be subject to liquidation or
exchange for another benefit, and (iii) the amount of expenses eligible
for reimbursement or in-kind benefits provided during any taxable year shall
not affect the expenses eligible for reimbursement or in-kind benefits to be
provided in any other taxable year; provided,  that the foregoing clause shall not be
violated with regard to expenses reimbursed under any arrangement covered by Section 105(b) of
the Code solely because such expenses are subject to a limit related to the
period the arrangement is in effect.

 

(d)           While the payments and benefits provided
hereunder are intended to be structured in a manner to avoid the implication of
any penalty taxes under Section 409A of the Code, in no event whatsoever
shall the Company or any member of the Company Group be liable for any
additional tax, interest, or penalties that may be imposed on Employee as a
result of Section 409A of the Code or any damages for failing to comply
with Section 409A of the Code (other than for withholding obligations or
other obligations applicable to employers, if any, under Section 409A of
the Code).

 

Section 14.             Successors and Assigns; No Third-Party Beneficiaries.

 

(a)           The Company.  This
Agreement shall inure to the benefit of the Company and its respective
successors and assigns.  Neither this
Agreement nor any of the rights, obligations, or interests arising hereunder
may be assigned by the Company to a Person (other than another member of the
Company Group, or its or their respective successors) without Employee’s prior
written consent (which shall not be unreasonably withheld, delayed, or
conditioned); provided, however, that in the event of a sale of
all or substantially all of the assets of the Company, the Company may provide
that this Agreement will be assigned to, and assumed by, the acquiror of such
assets, it being agreed that in such circumstances, Employee’s consent will not
be required in connection therewith.

 

(b)           Employee.  Employee’s
rights and obligations under this Agreement shall not be transferable by
Employee by assignment or otherwise, without the prior written consent of the
Company; provided, however, that if Employee shall die, all
amounts then payable to 

 

13

 

Employee hereunder shall
be paid in accordance with the terms of this Agreement to Employee’s devisee,
legatee, or other designee, or if there be no such designee, to Employee’s
estate.

 

(c)           No Third-Party Beneficiaries. 
Except as otherwise set forth in Section 8(b) or Section 14(b) hereof,
nothing expressed or referred to in this Agreement will be construed to give
any Person other than the Company, the other members of the Company Group, and
Employee any legal or equitable right, remedy, or claim under or with respect
to this Agreement or any provision of this Agreement.

 

Section 15.             Waiver and Amendments.

 

Any
waiver, alteration, amendment, or modification of any of the terms of this
Agreement shall be valid only if made in writing and signed by each of the
parties hereto; provided, however,
that any such waiver, alteration, amendment, or modification must be consented
to on the Company’s behalf by the Board. 
No waiver by either of the parties hereto of their rights hereunder
shall be deemed to constitute a waiver with respect to any subsequent
occurrences or transactions hereunder unless such waiver specifically states
that it is to be construed as a continuing waiver.

 

Section 16.             Severability.

 

If
any covenants or such other provisions of this Agreement are found to be invalid
or unenforceable by a final determination of a court of competent jurisdiction,
(a) the remaining terms and provisions hereof shall be unimpaired, and
(b) the invalid or unenforceable term or provision hereof shall be deemed
replaced by a term or provision that is valid and enforceable and that comes
closest to expressing the intention of the invalid or unenforceable term or
provision hereof.

 

Section 17.             Governing Law and Jurisdiction.

 

THIS
AGREEMENT IS GOVERNED BY AND IS TO BE CONSTRUED UNDER THE LAWS OF THE STATE OF
NORTH CAROLINA, WITHOUT REGARD TO CONFLICT OF LAWS RULES.  ANY DISPUTE OR CLAIM ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR CLAIM OF BREACH HEREOF SHALL BE BROUGHT
EXCLUSIVELY IN FEDERAL COURT IN THE STATE OF NORTH CAROLINA.  BY EXECUTION OF THE AGREEMENT, THE PARTIES
HERETO, AND THEIR RESPECTIVE AFFILIATES, CONSENT TO THE EXCLUSIVE JURISDICTION
OF SUCH COURT, AND WAIVE ANY RIGHT TO CHALLENGE JURISDICTION OR VENUE IN SUCH
COURT WITH REGARD TO ANY SUIT, ACTION, OR PROCEEDING UNDER OR IN CONNECTION
WITH THE AGREEMENT.  EACH PARTY TO THIS
AGREEMENT ALSO HEREBY WAIVES ANY RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY
SUIT, ACTION, OR PROCEEDING UNDER OR IN CONNECTION WITH THIS AGREEMENT.

 

Section 18.             Notices.

 

(a)           Place of Delivery.  Every
notice or other communication relating to this Agreement shall be in writing,
and shall be mailed to or delivered to the party for whom or 

 

14

 

which it is intended at
such address as may from time to time be designated by it in a notice mailed or
delivered to the other party as herein provided; provided, that unless and until some other address be so
designated, all notices and communications by Employee to the Company shall be
mailed or delivered to the Company at its principal executive office,
attention: General Counsel, and all notices and communications by the Company
to Employee may be given to Employee personally or may be mailed to Employee at
Employee’s last known address, as reflected in the Company’s records.

 

(b)           Date of Delivery.  Any
notice so addressed shall be deemed to be given (i) if delivered by hand,
on the date of such delivery, (ii) if mailed by courier or by overnight
mail, on the first business day following the date of such mailing, and
(iii) if mailed by registered or certified mail, on the third business day
after the date of such mailing.

 

Section 19.             Section Headings.

 

The
headings of the sections and subsections of this Agreement are inserted for
convenience only and shall not be deemed to constitute a part thereof or affect
the meaning or interpretation of this Agreement or of any term or provision
hereof.

 

Section 20.             Entire Agreement.

 

This
Agreement, together with any exhibits attached hereto, constitutes the entire
understanding and agreement of the parties hereto regarding the employment of
Employee.  This Agreement supersedes all
prior negotiations, discussions, correspondence, communications,
understandings, and agreements between the parties relating to the subject
matter of this Agreement.

 

Section 21.             Survival of Operative Sections.

 

Upon
any termination of Employee’s employment, the provisions of Section 8
through Section 22 of this Agreement (together with any related
definitions set forth in Section 1 hereof) shall survive to the extent
necessary to give effect to the provisions thereof.

 

Section 22.             Counterparts.

 

This
Agreement may be executed in two or more counterparts, each of which shall be
deemed to be an original but all of which together shall constitute one and the
same instrument.  The execution of this
Agreement may be by actual or facsimile signature.

 

15

 

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

 

	
   

  	
  FAIRPOINT
  COMMUNICATIONS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Shirley J. Linn

  
	
   

  	
  By:
  Shirley J. Linn

  
	
   

  	
  Title:
  Executive Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Paul H. Sunu

  
	
   

  	
  Paul
  H. Sunu

  

 

 

Exhibit A

 

CONFIDENTIALITY, NON-INTERFERENCE, AND INVENTION
ASSIGNMENT AGREEMENT

 

As
a condition of my becoming employed by FairPoint Communications, Inc., a
Delaware corporation (the “Company”), and in consideration of my
employment with the Company and my receipt of the compensation now and
hereafter paid to me by the Company, I agree to the following:

 

Section 1.               Confidential Information.

 

(a)           Company Group Information.  I
acknowledge that, during the course of my employment, I will have access
to information about the Company and its direct and indirect subsidiaries and
affiliates (collectively, the “Company Group”) and that my employment
with the Company shall bring me into close contact with confidential and
proprietary information of the Company Group. 
In recognition of the foregoing, I agree, at all times during the
term of my employment with the Company and for the three (3) year period
following my termination of my employment for any reason, to hold in
confidence, and not to use, except for the benefit of the Company Group, or to
disclose to any person, firm, corporation, or other entity without written
authorization of the Company, any Confidential Information that I obtain or
create.  I understand that “Confidential
Information” means information that the Company Group has developed,
acquired, created, compiled, discovered, or owned or will develop, acquire,
create, compile, discover, or own, that has value in or to the business of the
Company Group that is not generally known and that the Company wishes to
maintain as confidential.  I understand
that Confidential Information includes, but is not limited to, any and all
non-public information that relates to the actual or anticipated business
and/or products, research, or development of the Company, or to the Company’s
technical data, trade secrets, or know-how, including, but not limited to,
research, product plans, or other information regarding the Company’s products
or services and markets, customer lists, and customers (including, but not limited
to, customers of the Company on whom I called or with whom I may become
acquainted during the term of my employment), software, developments,
inventions, processes, formulas, technology, designs, drawings, engineering,
hardware configuration information, marketing, finances, and other business
information disclosed by the Company either directly or indirectly in writing,
orally, or by drawings or inspection of premises, parts, equipment, or other
Company property.  Notwithstanding the
foregoing, Confidential Information shall not include (i) any of the
foregoing items that have become publicly known through no unauthorized
disclosure by me or others who were under confidentiality obligations as to the
item or items involved, (ii) any information that I am required to
disclose to, or by, any governmental or judicial authority, (iii) any
information known to me prior to signing this Confidentiality,
Non-Interference, and Invention Assignment Agreement (the “Non-Interference
Agreement”) other than information acquired in preparation for my service
to the Company, or (iv) any information developed independently by me that
does not relate to the business of the Company Group; provided, however,
that in the event of such requirement to disclose I will give the Company
prompt written notice thereof so that the Company Group may seek an appropriate
protective order and/or waive in writing compliance with the confidentiality
provisions of this Non-Interference Agreement.

 

(b)           Former Employer Information.  I
represent that my performance of all of the terms of this Non-Interference
Agreement as an employee of the Company has not breached 

 

 

and will not breach any
agreement to keep in confidence proprietary information, knowledge, or data
acquired by me in confidence or trust prior or subsequent to the commencement
of my employment with the Company, and I will not disclose to any member of the
Company Group, or induce any member of the Company Group to use, any
developments, or confidential or proprietary information or material I may have
obtained in connection with employment with any prior employer in violation of
a confidentiality agreement, nondisclosure agreement, or similar agreement with
such prior employer.

 

Section 2.               Developments.

 

(a)           Developments Retained and Licensed.  If,
during any period during which I perform or performed services for the Company
Group (the “Assignment Period”), whether as an officer, employee,
director, independent contractor, consultant, or agent, or in any other
capacity, I incorporate (or have incorporated) into a Company Group
product or process any development, original work of authorship, improvement,
or trade secret that I created or owned prior to the commencement of my
employment or in which I have an interest (collectively referred to as “Prior
Developments”), I hereby grant the Company, and the Company Group
shall have, a non-exclusive, royalty-free, irrevocable, perpetual, transferable
worldwide license (with the right to sublicense) to make, have made, copy,
modify, make derivative works of, use, sell, and otherwise distribute such
Prior Development as part of or in connection with such product or process.

 

(b)           Assignment of Developments.  I
agree that I will, without additional compensation, promptly make full written
disclosure to the Company, and will hold in trust for the sole right and
benefit of the Company all developments, original works of authorship,
inventions, concepts, know-how, improvements, trade secrets, and similar
proprietary rights, whether or not patentable or registrable under copyright or
similar laws, which I may solely or jointly conceive or develop or reduce to
practice, or have solely or jointly conceived or developed or reduced to
practice, or have caused or may cause to be conceived or developed or reduced
to practice, during the Assignment Period, whether or not during regular
working hours, provided they either (i) relate at the time of conception,
development or reduction to practice to the business of any member of the
Company Group, or the actual or anticipated research or development of any
member of the Company Group; (ii) result from or relate to any work
performed for any member of the Company Group; or (iii) are developed
through the use of equipment, supplies, or facilities of any member of the
Company Group, or any Confidential Information, or in consultation with
personnel of any member of the Company Group (collectively referred to as “Developments”).  I further acknowledge that all Developments
made by me (solely or jointly with others) within the scope of and during the
Assignment Period are “works made for hire” (to the greatest extent permitted
by applicable law) for which I am, in part, compensated by my salary, unless
regulated otherwise by law, but that, in the event any such Development is
deemed not to be a work made for hire, I hereby assign to the Company, or
its designee, all my right, title, and interest throughout the world in and to
any such Development.

 

(c)           Maintenance of Records.  I
agree to keep and maintain adequate and current written records of all
Developments made by me (solely or jointly with others) during the Assignment
Period. The records may be in the form of notes, sketches, drawings, flow
charts, 

 

 

electronic data or
recordings, and any other format.  The records
will be available to and remain the sole property of the Company Group at all
times.  I agree not to remove such
records from the Company’s place of business except as expressly permitted by
Company Group policy, which may, from time to time, be revised at the sole
election of the Company Group for the purpose of furthering the business of the
Company Group.

 

(d)           Intellectual Property Rights.  I
agree to assist the Company, or its designee, at the Company’s expense, in
every way to secure the rights of the Company Group in the Developments and any
copyrights, patents, trademarks, service marks, database rights, domain names,
mask work rights, moral rights, and other intellectual property rights relating
thereto in any and all countries, including the disclosure to the Company of
all pertinent information and data with respect thereto, the execution of all
applications, specifications, oaths, assignments, recordations, and all other
instruments that the Company shall deem necessary in order to apply for,
obtain, maintain, and transfer such rights and in order to assign and convey to
the Company Group the sole and exclusive right, title, and interest in and to
such Developments, and any intellectual property and other proprietary rights
relating thereto.  I further agree that
my obligation to execute or cause to be executed, when it is in my power to do
so, any such instrument or papers shall continue after the termination of the
Assignment Period until the expiration of the last such intellectual property
right to expire in any country of the world;
provided, however, the
Company shall reimburse me for my reasonable expenses incurred in connection
with carrying out the foregoing obligation. 
If the Company is unable because of my mental or physical incapacity or
unavailability for any other reason to secure my signature to apply for or to
pursue any application for any United States or foreign patents or copyright
registrations covering Developments or original works of authorship assigned to
the Company as above, then I hereby irrevocably designate and appoint the
Company and its duly authorized officers and agents as my agent and attorney in
fact to act for and in my behalf and stead to execute and file any such
applications or records and to do all other lawfully permitted acts to further
the application for, prosecution, issuance, maintenance, and transfer of
letters patent or registrations thereon with the same legal force and effect as
if originally executed by me.  I hereby
waive and irrevocably quitclaim to the Company any and all claims, of any
nature whatsoever, that I now or hereafter have for past, present, or future
infringement of any and all proprietary rights assigned to the Company.

 

Section 3.               Returning Company Group Documents.

 

I
agree that, at the time of termination of my employment with the Company for
any reason, I will deliver to the Company (and will not keep in my
possession, recreate, or deliver to anyone else) any and all Confidential
Information and all other documents, materials, information, and property
developed by me pursuant to my employment or otherwise belonging to the
Company. I agree further that any property situated on the Company’s premises
and owned by the Company (or any other member of the Company Group), including
disks and other storage media, filing cabinets, and other work areas, is
subject to inspection by personnel of any member of the Company Group at any
time with or without notice.

 

 

Section 4.               Disclosure of Agreement.

 

As
long as it remains in effect, I will disclose the existence of this
Non-Interference Agreement to any prospective employer, partner, co-venturer,
investor, or lender prior to entering into an employment, partnership, or other
business relationship with such person or entity.

 

Section 5.               Restrictions on Interfering.

 

(a)           Non-Competition.  During the
period of my employment with the Company (the “Employment Period”)
and the Post-Termination Non-Compete Period, I shall not, directly or
indirectly, individually or on behalf of any person, company, enterprise, or
entity, or as a sole proprietor, partner, stockholder, director, officer,
principal, agent, or executive, or in any other capacity or relationship,
engage in any Competitive Activities.

 

(b)           Non-Interference. 
During the Employment Period and the Post-Termination Non-Interference
Period, I shall not, directly or indirectly for my own account or for the
account of any other individual or entity, engage in Interfering Activities; provided, however,
that I shall not be deemed to violate this subsection (b) to the extent
that any employee of any subsequent employer of mine, in the ordinary course of
business, conducts any activity described in subsection (c)(iii)(C) below
as to any Business Relation, provided that I have not directed or instructed
any such employee (either personally or through another) to contact any such
Business Relation.

 

(c)           Definitions.  For
purposes of this Non-Interference Agreement :

 

(i)            “Business Relation” shall mean any current or prospective client,
customer, licensee, or other business relation of the Company Group, or any
such relation that was a client, customer, licensee, or other business relation
within the six (6) month period prior to the expiration of the Employment
Period, in each case, to whom I provided services, or with whom I transacted
business, or whose identity became known to me in connection with my
relationship with or employment by the Company and is not publicly known.

 

(ii)           “Competitive Activities” shall mean telecommunication services
provided by a local exchange carrier business which has substantial business
operations in the states of Florida, Georgia, North Carolina, South Carolina,
Maine, New Hampshire or Vermont.

 

(iii)          “Interfering Activities” shall mean (A) encouraging,
soliciting, or inducing, or in any manner attempting to encourage, solicit, or
induce, any Person employed by, or providing consulting services to, any member
of the Company Group to terminate such Person’s employment or services (or in
the case of a consultant, materially reducing such services) with the Company
Group; (B) hiring any individual who was employed by the Company Group
within the six (6) month period prior to the date of such hiring; or (C) encouraging,
soliciting, or inducing, or in any manner attempting to encourage, solicit, or
induce, any Business Relation to cease doing business with or reduce the amount
of business conducted with the Company Group, or in any way 

 

 

interfering with the
relationship between any such Business Relation and the Company Group.

 

(iv)          “Person” shall mean any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust (charitable or non-charitable), unincorporated organization, or other
form of business entity.

 

(v)           “Post-Termination Non-Compete Period” shall mean the period
commencing on the date of the termination of the Employment Period for any
reason and ending on the twenty-four (24) month anniversary of such date of
termination.

 

(vi)          “Post-Termination Non-Interference Period” shall mean the period
commencing on the date of the termination of the Employment Period for any
reason and ending on the twenty-four (24) month anniversary of such date of
termination.

 

(d)           Non-Disparagement.  I
agree that during the Employment Period, and at all times thereafter, I
will not make any disparaging or defamatory comments regarding any member of
the Company Group or its respective current or former directors, officers, or
employees in any respect or make any comments concerning any aspect of my
relationship with any member of the Company Group or any conduct or events
which precipitated any termination of my employment from any member of the
Company Group.  However, my obligations
under this subparagraph (d) shall not apply to disclosures required by
applicable law, regulation, or order of a court or governmental agency.

 

Section 6.               Reasonableness of Restrictions.

 

I
acknowledge and recognize the highly competitive nature of the Company’s
business, that access to Confidential Information renders me special and unique
within the Company’s industry, and that I will have the opportunity to develop
substantial relationships with existing and prospective clients, accounts,
customers, consultants, contractors, investors, and strategic partners of the
Company Group during the course of and as a result of my employment with the
Company.  In light of the foregoing, I
recognize and acknowledge that the restrictions and limitations set forth in
this Non-Interference Agreement are reasonable and valid in geographical and
temporal scope and in all other respects and are essential to protect the value
of the business and assets of the Company Group.  I acknowledge further that the restrictions
and limitations set forth in this Non-Interference Agreement will not
materially interfere with my ability to earn a living following the termination
of my employment with the Company and that my ability to earn a livelihood
without violating such restrictions is a material condition to my employment
with the Company.

 

Section 7.               Independence; Severability; Blue Pencil.

 

Each
of the rights enumerated in this Non-Interference Agreement shall be
independent of the others and shall be in addition to and not in lieu of any
other rights and remedies available to the Company Group at law or in
equity.  If any of the provisions of this
Non-Interference Agreement or any part of any of them is hereafter construed or
adjudicated to be invalid or unenforceable, the same shall not affect the
remainder of this Non-Interference 

 

 

Agreement,
which shall be given full effect without regard to the invalid portions.  If any of the covenants contained herein are
held to be invalid or unenforceable because of the duration of such provisions
or the area or scope covered thereby, I agree that the court making such
determination shall have the power to reduce the duration, scope, and/or area
of such provision to the maximum and/or broadest duration, scope, and/or area
permissible by law, and in its reduced form said provision shall then be
enforceable.

 

Section 8.               Injunctive Relief.

 

I
expressly acknowledge that any breach or threatened breach of any of the terms
and/or conditions set forth in this Non-Interference Agreement may result in
irreparable injury to the members of the Company Group.  Therefore, I hereby agree that, in
addition to any other remedy that may be available to the Company, any member
of the Company Group shall be entitled to seek injunctive relief, specific
performance, or other equitable relief by a court of appropriate jurisdiction
in the event of any breach or threatened breach of the terms of this
Non-Interference Agreement without the necessity of proving irreparable harm or
injury as a result of such breach or threatened breach.  Notwithstanding any other provision to the
contrary, I acknowledge and agree that the Post-Termination Non-Compete
Period, or Post-Termination Non-Interference Period, as applicable, shall be
tolled during any period of violation of any of the covenants in Section 5
hereof.

 

Section 9.               Cooperation.

 

I
agree that, following any termination of my employment, I will continue to
provide reasonable cooperation to the Company and/or any other member of the
Company Group and its or their respective counsel in connection with any
investigation, administrative proceeding, or litigation relating to any matter
that occurred during my employment in which I was involved or of which I have
knowledge.  As a condition of such
cooperation, the Company shall reimburse me for reasonable out-of-pocket expenses
incurred at the request of the Company with respect to my compliance with this
paragraph.  I also agree that, in the
event that I am subpoenaed by any person or entity (including, but not limited
to, any government agency) to give testimony or provide documents (in a
deposition, court proceeding, or otherwise) that in any way relates to my
employment by the Company and/or any other member of the Company Group, I
will give prompt notice of such request to the Company and will make no
disclosure until the Company and/or the other member of the Company Group has
had a reasonable opportunity to contest the right of the requesting person or
entity to such disclosure.

 

Section 10.             General Provisions.

 

(a)           Governing Law and Jurisdiction.  THIS
NON-INTERFERENCE AGREEMENT IS GOVERNED BY AND IS TO BE CONSTRUED UNDER THE LAWS
OF THE STATE OF NORTH CAROLINA, WITHOUT REGARD TO CONFLICT OF LAWS RULES.  ANY DISPUTE OR CLAIM ARISING OUT OF OR
RELATING TO THIS NON-INTERFERENCE AGREEMENT OR CLAIM OF BREACH HEREOF SHALL BE
BROUGHT EXCLUSIVELY IN FEDERAL COURT IN THE STATE OF NORTH CAROLINA.  BY EXECUTION OF THE NON-INTERFERENCE
AGREEMENT, THE PARTIES HERETO, AND THEIR RESPECTIVE AFFILIATES, CONSENT TO THE
EXCLUSIVE 

 

 

JURISDICTION OF SUCH
COURT, AND WAIVE ANY RIGHT TO CHALLENGE JURISDICTION OR VENUE IN SUCH COURT
WITH REGARD TO ANY SUIT, ACTION, OR PROCEEDING UNDER OR IN CONNECTION WITH THE
NON-INTERFERENCE AGREEMENT.  EACH PARTY
TO THIS NON-INTERFERENCE AGREEMENT ALSO HEREBY WAIVES ANY RIGHT TO TRIAL BY
JURY IN CONNECTION WITH ANY SUIT, ACTION, OR PROCEEDING UNDER OR IN CONNECTION
WITH THIS NON-INTERFERENCE AGREEMENT.

 

(b)           Entire Agreement.  This
Non-Interference Agreement sets forth the entire agreement and understanding
between the Company and me relating to the subject matter herein and merges all
prior discussions between us.  No
modification or amendment to this Non-Interference Agreement, nor any waiver of
any rights under this Non-Interference Agreement, will be effective unless in
writing signed by the party to be charged. 
Any subsequent change or changes in my duties, obligations, rights, or
compensation will not affect the validity or scope of this Non-Interference
Agreement.

 

(c)           No Right of Continued Employment.  I
acknowledge and agree that nothing contained herein shall be construed as
granting me any right to continued employment by the Company, and the right of
the Company to terminate my employment at any time and for any reason, with or
without cause, is specifically reserved.

 

(d)           Successors and Assigns.  This
Non-Interference Agreement will be binding upon my heirs, executors,
administrators, and other legal representatives and will be for the benefit of
the Company, its successors, and its assigns. 
I expressly acknowledge and agree that this Non-Interference Agreement
may be assigned by the Company without my consent to any other member of the
Company Group as well as any purchaser of all or substantially all of the
assets or stock of the Company, whether by purchase, merger, or other similar
corporate transaction, provided that the license granted pursuant to Section 2(a) may
be assigned to any third party by the Company without my consent.

 

(e)           Survival.  The
provisions of this Non-Interference Agreement shall survive the termination of
my employment with the Company and/or the assignment of this Non-Interference
Agreement by the Company to any successor in interest or other assignee.

 

*              *              *

 

I,
Paul H. Sunu, have executed this Confidentiality, Non-Interference, and
Invention Assignment Agreement on the respective date set forth below:

 

	
  Date:

  	
  August 16,
  2010

  	
   

  	
  /s/
  Paul H. Sunu

  
	
   

  	
   

  	
  (Signature)

  

 

 

Exhibit B

RELEASE OF CLAIMS

 

As
used in this Release of Claims (this “Release”), the term “claims” will
include all claims, covenants, warranties, promises, undertakings, actions,
suits, causes of action, obligations, debts, accounts, attorneys’ fees,
judgments, losses, and liabilities, of whatsoever kind or nature, in law, in
equity, or otherwise.

 

For
and in consideration of the Severance Benefits (as defined in my Employment
Agreement, dated July 20, 2010, with FairPoint Communications, Inc.
(the “Employment Agreement”)), and other good and valuable consideration, I,
Paul H. Sunu, for and on behalf of myself and my heirs, administrators,
executors, and assigns, effective as of the date on which this release becomes
effective pursuant to its terms, do fully and forever release, remise, and
discharge each of the Company and each of its direct and indirect subsidiaries
and affiliates, together with their respective officers, directors, partners,
shareholders, employees, and agents (collectively, the “Group”), from
any and all claims whatsoever up to the date hereof that I had, may have had,
or now have against the Group, whether known or unknown, for or by reason of any
matter, cause, or thing whatsoever, including any claim arising out of or
attributable to my employment or the termination of my employment with the
Company, whether for tort, breach of express or implied employment contract,
intentional infliction of emotional distress, wrongful termination, unjust
dismissal, defamation, libel, or slander, or under any federal, state, or local
law dealing with discrimination based on age, race, sex, national origin,
handicap, religion, disability, or sexual orientation.  This release of claims includes, but is not
limited to, all claims arising under the Age Discrimination in Employment Act (“ADEA”),
Title VII of the Civil Rights Act, the Americans with Disabilities Act, the
Civil Rights Act of 1991, the Family Medical Leave Act, the Equal Pay Act, the
Genetic Information Nondiscrimination Act, the North Carolina Equal Employment
Practices Act, and the North Carolina Persons with Disabilities Act, each as
may be amended from time to time, and all other federal, state, and local laws,
the common law, and any other purported restriction on an employer’s right to
terminate the employment of employees. 
The release contained herein is intended to be a general release of any
and all claims to the fullest extent permissible by law.

 

I
acknowledge and agree that as of the date I execute this Release, I have
no knowledge of any facts or circumstances that give rise or could give rise to
any claims under any of the laws listed in the preceding paragraph.

 

By
executing this Release, I specifically release all claims relating to my
employment and its termination under ADEA, a United States federal statute
that, among other things, prohibits discrimination on the basis of age in
employment and employee benefit plans.

 

Notwithstanding
any provision of this Release to the contrary, by executing this Release, I
am not releasing (i) any claims relating to my rights under Sections 4(f) and
8 of the Employment Agreement, (ii) any claims that cannot be waived by
law, or (iii) my right of indemnification as provided by, and in
accordance with the terms of, the Company’s by-laws or a Company insurance
policy providing such coverage, as any of such may be amended from time to
time.

 

I
expressly acknowledge and agree that I —

 

 

·              Am able to read the language, and understand the
meaning and effect, of this Release;

 

·              Have no physical or mental impairment of any kind
that has interfered with my ability to read and understand the meaning of this
Release or its terms, and that I am not acting under the influence of any
medication, drug, or chemical of any type in entering into this Release;

 

·              Am specifically agreeing to the terms of the release
contained in this Release because the Company has agreed to pay me the
Severance Benefits in consideration for my agreement to accept it in full
settlement of all possible claims I might have or ever have had, and because of
my execution of this Release;

 

·              Acknowledge that, but for my execution of this
Release, I would not be entitled to the Severance Benefits;

 

·              Understand that, by entering into this Release, I
do not waive rights or claims under ADEA that may arise after the date I
execute this Release;

 

·              Had or could have had [twenty-one (21)][forty-five
(45)](1) days from the date of my termination of employment (the “Release
Expiration Date”) in which to review and consider this Release, and that if
I execute this Release prior to the Release Expiration Date, I have
voluntarily and knowingly waived the remainder of the review period;

 

·              Have not relied upon any representation or statement
not set forth in this Release or my Employment Agreement made by the Company or
any of its representatives;

 

·              Was advised to consult with my attorney regarding
the terms and effect of this Release; and

 

·              Have signed this Release knowingly and voluntarily.

 

I
hereby agree to waive any and all claims to re-employment with the Company or
any other member of the Company Group (as defined in my Employment Agreement)
and affirmatively agree not to seek further employment with the Company or any
other member of the Company Group.

 

Notwithstanding
anything contained herein to the contrary, this Release will not become
effective or enforceable prior to the expiration of the period of seven (7) calendar
days following the date of its execution by me (the “Revocation Period”), during which
time I may 

 

(1)           To be selected based on
whether applicable termination was “in
connection with an exit incentive or other employment termination program”
(as such phrase is defined in the Age
Discrimination in Employment Act of 1967).

 

 

revoke
my acceptance of this Release by notifying the Company and the Board of
Directors of the Company, in writing, delivered to the Company at its principal
executive office, marked for the attention of its [General Counsel].  To be effective, such revocation must be
received by the Company no later than 11:59 p.m. on the seventh (7th) calendar day following the
execution of this Release.  Provided that
the Release is executed and I do not revoke it during the Revocation Period,
the eighth (8th) day following
the date on which this Release is executed shall be its effective date.  I acknowledge and agree that if I revoke this
Release during the Revocation Period, this Release will be null and void and of
no effect, and neither the Company nor any other member of the Company Group
will have any obligations to pay me the Severance Benefits.

 

The
provisions of this Release shall be binding upon my heirs, executors,
administrators, legal personal representatives, and assigns.  If any provision of this Release shall be
held by any court of competent jurisdiction to be illegal, void, or
unenforceable, such provision shall be of no force or effect.  The illegality or unenforceability of such
provision, however, shall have no effect upon and shall not impair the enforceability
of any other provision of this Release.

 

EXCEPT
WHERE PREEMPTED BY FEDERAL LAW, THIS RELEASE SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH FEDERAL LAW AND THE LAWS OF THE STATE OF NORTH CAROLINA,
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN THAT STATE WITHOUT GIVING
EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAWS. 
I HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY SUIT,
ACTION, OR PROCEEDING UNDER OR IN CONNECTION WITH THIS RELEASE.

 

Capitalized
terms used, but not defined herein, shall have the meanings ascribed to such
terms in my Employment Agreement.

 

 

	
   

  	
  /s/
  Paul H. Sunu

  
	
   

  	
  Paul
  H. Sunu

  
	
   

  	
  Date:
  August 16, 2010

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