Document:

Exhibit 10.20

 

CHANGE OF CONTROL AGREEMENT

 

                This Change of Control Agreement
(this “Agreement”) is entered into as of the 29th day of November,
2007, by and between HickoryTech Corporation, a Minnesota corporation (the “Company”),
and Damon D. Dutz (the “Executive”).

 

WITNESSETH:

 

                WHEREAS, the Executive will
devote substantial skill and effort to the affairs of the Company, and the
Board of Directors of the Company desires to recognize the significant personal
contribution that the Executive will make to further the best interests of the
Company; and

 

                WHEREAS, it is desirable and in
the best interests of the Company and its stockholders to continue to obtain
the benefits of the Executive’s services and attention to the affairs of the
Company, and

 

                WHEREAS, it is desirable and in
the best interests of the Company and its stockholders to provide inducement
for the Executive (1) to remain in the service of the Company in order to
facilitate an orderly transition in the event of a change in control of the Company
and (2) to remain in the service of the Company in the event of any
threatened or anticipated change in control of the Company; and

 

                WHEREAS, it is desirable and in
the best interests of the Company and its stockholders that the Executive be in
a position to make judgments and take actions with respect to a proposed change
in control of the Company without regard to the possibility that his or her
employment may be terminated without compensation in the event of certain
changes in control of the Company; and

 

                WHEREAS, the Executive desires
to be protected in the event of certain changes in control of the Company; and

 

                WHEREAS, for the reasons set
forth above, the Company and the Executive desire to enter into this Agreement.

 

                NOW, THEREFORE, in consideration
of the facts recited above and the mutual covenants and agreements contained
herein, the Company and the Executive agree as follows:

 

1.                                       Right to Payment. If the Executive’s employment with the
Company or its Successor is terminated within three (3) years following an
Event (as defined in Paragraph 2 below) for any reason other than a reason
specified in Paragraph 3(a) through (d) below, then the Executive
shall be entitled to receive the Benefits set out in Paragraph 4 below. If a
subsequent Event occurs, and if the Executive is an employee of the Company or
its Successor, without limiting any rights the Executive may have, Executive
shall have all rights provided by the first sentence of this Paragraph 1
relating to such subsequent event.

 

2.                                       Change of Control Events. An “Event” shall be deemed to have
occurred if:

 

(a)                                  A majority of the directors of the
Company shall be persons other than persons

 

(1)                                  for whose election proxies shall have
been solicited by the Board of Directors of the Company; or

 

(2)                                  who are then serving as directors and who
were initially appointed or elected by the Board of Directors to fill vacancies
on the Board of Directors caused by death or resignation (but not by removal),
or to fill newly created directorships created by the Board of Directors;

 

provided, however, that a
person shall not be deemed to be a director subject to clause (1) or (2),
above, if his or her initial assumption of office occurs as a result of an
actual or threatened election contest with respect to the threatened election
or removal of directors (or other actual or threatened solicitation of proxies
or consents) by or on behalf of any person other than the Board of Directors of
the Company; or

 

1

 

(b)                                 30% or more of the outstanding voting
stock of the Company or all or substantially all of the assets or stock of the
Company is acquired or beneficially owned (as defined in Rule 13d-3 under
the Securities and Exchange Act of 1934, as amended, or any successor rule thereto),
directly or indirectly, by any Person (other than by the Company, a subsidiary
of the Company, an employee benefit plan (or related trust) sponsored or
maintained by the Company or one or more of its subsidiaries, or by the
Employee or a group of persons, including the Employee, acting in concert) or
group of Persons, acting in concert, whether by acquisition of assets, merger,
consolidation, statutory share exchange (other than a merger, consolidation or
statutory share exchange described in clause (c)(i) or (ii), below),
tender offer, exchange offer, or otherwise;

 

(c)                                  The Company is merged into or
consolidated with another corporation (other than a subsidiary of the Company)
or a statutory share exchange for the Company’s outstanding voting stock of any
class is consummated unless (i) a majority of the voting power of the
voting stock of the surviving corporation is, immediately following the merger,
consolidation or statutory share exchange, beneficially owned, directly or
indirectly, by the Employee (or a group of Persons, including the Employee,
acting in concert) or (ii) immediately following the merger, consolidation
or statutory share exchange, more than 70% of the voting power of the voting
stock of the surviving corporation is beneficially owned, directly or
indirectly, by the persons who beneficially owned voting stock of the Company
immediately prior to such merger, consolidation or statutory share exchange in
substantially the same proportion as their ownership of the voting stock of the
Company immediately prior to such merger, consolidation or statutory share
exchange; or

 

(d)                                 The shareholders of the Company approve
the complete liquidation or dissolution of the Company.

 

3.                                       Termination Not Entitling Executive to
Benefits. The Executive
shall not be entitled to the Benefits set out in Paragraph 4 if his or her
employment is terminated during the three (3) year period following an
Event for any of the following reasons:

 

(a)                                  Death. The Executive’s death.

 

(b)                                 Disability. The Executive’s disability. “Disability” shall mean
the inability of the Executive to perform the duties and responsibilities of
his or her employment by reasons of illness or other physical or mental
impairment or condition, if such inability continues for an uninterrupted
period of ninety (90) calendar days or more. A period of inability shall be “uninterrupted”
unless and until the Executive is no longer considered disabled by the Company’s
Long Term Disability Insurer.

 

(1)                                  The determination of whether the Executive
is suffering from a “disability” as defined herein shall be made. The
determination of whether the Executive is disabled shall be on the same basis
as the Company provided Long-Term Disability benefit, which is a fully insured
benefit provided by an independent third party. If the Executive meets the
disability criteria for long term disability benefits under this Company
provided benefit, the Executive will also be considered disabled under this
Agreement.

 

(2)                                  The Executive agrees to make himself or
herself available for and to submit to examinations by such physicians as may
be requested by the Company or the Company’s Long Term Disability Insurer. The
Executive’s failure to submit to examinations by such physicians as may be
requested shall disqualify Executive from receiving Benefits under this
Agreement.

 

(c)                                  Voluntary Termination. The Executive’s voluntary retirement or
voluntary termination of employment. However, the Executive’s retirement or
termination of employment shall not be considered voluntary if, following the
Event and subject to the provisions for notification set forth below, one or
more of the following has occurred without Executive’s express written consent
and results in a material negative change to Executive:

 

(1)                                  There has been a failure to provide the
Executive with substantially equivalent reporting responsibilities, titles,
offices or positions, or Executive has been removed from, or has not been
re-elected to, any of such positions, which has the effect of materially diminishing
the Executive’s responsibility or authority;

 

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(2)                                  There has been a failure to provide the
Executive with: (a) the same base salary, or (b) substantially
equivalent (or greater) total salary opportunity, or (c) employee benefits
which are, in the aggregate, substantially equivalent to those provided to the
Executive at the time of the Event;

 

(3)                                  There has been a failure to provide the
Executive with substantially equivalent office space or administrative support;
or

 

(4)                                  Executive has been required to perform
his or her services in a location that is more than fifty (50) miles from the
Executive’s regularly assigned office location at the time of the Event, or
Executive is required to undertake substantially more job-related traveling.

 

In the event of an
occurrence of the type enumerated in subparagraphs (1) through (4) above,
Executive shall, within ten (10) days following Executive’s actual
knowledge of such occurrence, notify the Company in writing of the specific
occurrence which Executive believes would render his/her retirement or
termination not voluntary and, following receipt of such notice, the Company
shall be afforded a period of thirty (30) days within which to remedy such
occurrence.  In the event that Executive
fails to provide such notice or to afford such opportunity to remedy the
occurrence, or in the event the Company does remedy the occurrence within
thirty days, then none of the occurrences specified in subparagraphs (1) through
(4) above may be relied upon by Executive to characterize his/her
retirement or termination as not voluntary.

 

(d)                                 Involuntary Termination For Cause. The
Executive’s involuntary termination “for cause.” “For cause” shall mean:

 

(1)                                  A persistent failure by the Executive to
perform the duties and responsibilities of his or her job, which failure is
willful and deliberate on the Executive’s part and is not remedied within a
reasonable period of time after the Executive’s receipt of written notice from
the Company or its Successor specifying the act or omission constituting such
failure;

 

(2)                                  A criminal act or acts undertaken by the
Executive and intended to result in substantial gain or personal enrichment of
the Executive at the expense of the Company or its Successor;

 

(3)                                  Unlawful conduct or gross misconduct that
is willful and deliberate on the Executive’s part and that, in either event, is
materially injurious to the Company or its Successor; or

 

(4)                                  The conviction of the Executive of a
felony.

 

(e)                                  Subsequent Occurrences. If the Executive’s employment is
terminated under circumstances in which Executive would be entitled to Benefits
as defined in Paragraph 4, and thereafter there is an occurrence that would
have justified the termination of the Executive’s employment with no
entitlement to Benefits (such as the Executive’s death, disability, voluntary
termination, or involuntary termination for cause [all as defined above in this
Paragraph]), that subsequent occurrence shall not disqualify the Executive (or
the Executive’s legal representative) from receiving or continuing to receive
the Benefits provided under this Agreement. If the Executive’s employment is
terminated under circumstances in which the Executive would be entitled to
Benefits as defined in Paragraph 4, and thereafter the executive is re-employed
by the Company, the Executive would be entitled to continue to receive payments
provided under this Agreement.

 

4.                                       Benefits. If the Executive’s employment is terminated under
circumstances entitling the Executive to Benefits, the Executive shall receive
the following:

 

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(a)                                  Lump Sum Payment. The Executive shall be entitled to a
lump sum cash payment in the amount of One Month’s Salary times 24. One Month’s
Salary shall be determined by taking the Executive’s highest annual
compensation for a calendar year (including base salary, the HickoryTech
Executive Incentive Plan bonuses paid in that calendar year, stock grants under
the Long Term Executive Incentive Program and any other incentive payments with
the exception of stock options) during the five-year period prior to the
Executive’s termination and dividing that amount by twelve (12).  For executives who have not yet been eligible
to receive a payment under the HickoryTech Executive Incentive Plan, or who
have only been eligible for one bonus payment under the HickoryTech Executive
Incentive Plan due to their time in the position or with the Company, One Month’s
Salary will be determined by taking one month of current base salary and adding
it to the greater of:

 

(1)                                  the bonus percentage for which the
Executive is eligible, calculated at the target payout as indicated in the
Hickory Tech Executive Incentive Plan, divided by twelve (12); or

 

(2)                                  the actual bonus payment received, or
calculated at the close of the fiscal year but not yet received due to timing
of the payout as indicated in the HickoryTech Executive Incentive Plan, divided
by twelve (12).

 

This lump sum payment
shall be made by the Company or its Successor at the time of the Executive’s
termination of employment, and shall be subject to withholding of all taxes and
other amounts required by law to be withheld or paid to others.

 

(b)                                 Section 280G Parachute Tax. In the event it shall be determined that
any payment or distribution by the Company or other amount with respect to the
Company to or for the benefit of the Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise, (a “Payment”) is (or will be) subject to the excise tax imposed by Section 280G
of the Internal Revenue Code or any interest or penalties are (or will be)
incurred by the Executive with respect to the excise tax imposed by Section 280G
of the Internal Revenue Code with respect to the Company (the excise tax,
together with any interest and penalties, are hereinafter collectively referred
to as the “Excise Tax”), and if a reduction in the Payment sufficient to avoid
the Excise Tax would result in an increase in the total amount of Payment net
of all applicable taxes, then, and only then, the Payment shall be reduced to
the amount that, when combined with all other payments and transfers of
property required to be taken into account under Section 280G of the
Internal Revenue Code, is $1 less than the smallest sum that would subject the
Executive to the Excise Tax.

 

(c)                                  Continued Insurance Coverage. The Executive shall be entitled to
continuation of his or her Company-provided insurance coverage (health, life,
dental, accidental death and dismemberment, and any other applicable insured
health and welfare benefit programs, excluding short and long-term disability)
for two years after the Executive’s employment termination, at the same levels
and coverage and on the same terms and conditions as if the Executive were
still an active employee of the Company or its Successor throughout such
period, including the right (if provided to active employees) to elect spousal
or family coverage.  In the event that
the participation of the Executive in any such insurance plan or program is
barred, the Company or its Successor, at its sole cost and expense, shall
arrange to provide the Executive with benefits substantially similar to those
which the Executive would otherwise be entitled to receive under such plans and
programs. Notwithstanding the foregoing, however, the Company or its Successor
shall not be required to provide any continuation coverage under this
subparagraph 4(d) to the extent that such coverage is duplicative of any
coverage the Executive is receiving under any other policy provided at the
expense of the Company.

 

(d)                                 Continuation of any other benefits or
perquisites being received by the Executive at the time of the Executive’s
employment termination will be negotiated with the Company or its Successor.

 

5.                                       Benefits Offset By Other Severance
Payments. The
lump sum payment provided in subparagraph 4(a) shall be in addition to any
salary or other remuneration otherwise payable to the Executive on account of
the Executive’s employment by the Company or its Successor. This payment shall
be in lieu of any severance payments under any other agreement resulting from
his or her termination of employment with the Company or its Successor.

 

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6.                                       No Duty to Mitigate. The Executive shall not be required to
mitigate the amount of any payment or other benefit provided for in Paragraph 4
by seeking other employment or otherwise, nor (except as specifically provided
in subparagraph 4(d) above) shall the amount of any payment or other
benefit provided for in Paragraph 4 be reduced by any compensation earned by
the Executive as the result of employment after the Executive’s employment
termination.

 

7.                                       Definition of Certain Terms.

 

(a)                                  Successor. “Successor” means any Person that succeeds to the
business of the Company through merger, consolidation, or acquisition,
including any Person acquiring all or substantially all of the assets or stock
of the Company.

 

(b)                                 Person. “Person” means an individual, partnership,
corporation, estate, trust, or other entity.

 

8.                                       Successors and Assigns.

 

(a)                                  This Agreement shall be binding upon and
inure to the benefit of the legal representatives, successors, and assigns of
the parties hereto; provided, however, that the Executive shall not have any
right to assign, pledge, or otherwise dispose of or transfer any interest in
this Agreement or any payments hereunder, whether directly or indirectly or in
whole or in part, without the written consent of the Company or its Successor.

 

(b)                                 The Company will require any Successor,
by agreement in form and substance satisfactory to the Executive, to assume
expressly and agree to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such
succession had taken place.

 

9.                                       Attorneys’ Fees, Costs and Interest. If the Executive (or the Executive’s
legal representative) successfully challenges, in whole or in part, the refusal
of the Company or its Successor to provide Benefits under this Agreement or to
abide by any other provision of this Agreement, then the Company or its
Successor shall pay to the Executive (or the Executive’s legal representative):

 

(a)                                  All legal fees, costs, disbursements, and
expenses incurred as a result of the refusal to provide Benefits or to abide by
the other provisions of the Agreement; and

 

(b)                                 Interest on any funds (or on the fair
market value of any benefits) that were wrongfully withheld by the Company or
its Successor, calculated by reference to the prime rate as in effect during
the applicable period.

 

10.                                 Governing Law. This Agreement shall be construed in
accordance with the laws of the State of Minnesota, without giving effect to
principles of conflicts of laws.

 

11.                                 Notices. All notices, requests, and demands given to or made
pursuant hereto shall be in writing and be either hand-delivered or mailed to
any such party at its address which:

 

(a)                                  In the case of the Company shall be:

 

HickoryTech Corporation

221 East Hickory Street

P.O. Box 3248

Mankato, MN  56002-3248

 

(b)                                 In the case of the Executive shall be:

 

Damon D. Dutz

507 Riverhills Road

Mankato, MN 56001

 

Either party may, by
notice hereunder, designate a changed address. Any notice, if properly
addressed and sent prepaid by registered or certified mail shall be deemed
dispatched on the registered date or that stamped on the certified mail
receipt, and shall be deemed received within the second business day thereafter
or when it is actually received, whichever is sooner. Any notice sent regular
mail or hand-delivered shall be deemed received when it is actually received by
the other party.

 

5

 

12.                                 Severability. In the event that any portion of this
Agreement may be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the other portions of this
Agreement, and any court of competent jurisdiction may so modify the
objectionable provision as to make it valid, reasonable, and enforceable.

 

13.                                 Incentive Compensation Plan and Stock
Options. In the
case of a payment being due as described in Paragraph 1, the Executive’s
benefits under the Annual Award of the HickoryTech Corporation Executive
Incentive Plan shall become immediately payable and any outstanding stock
options and unvested restricted shares shall be immediately vested. Any
Restricted Stock or Performance Stock Awards under the Long Term Executive
Incentive Program which are payable due to achievement of Performance
Objectives through the year in which the payment under this Agreement becomes
due will be paid and fully vested immediately upon the audited close of the
fiscal year financials, but in no case later than March 15 of the year
following when the payment becomes due under this Agreement. The Long Term
Executive Incentive Program Awards that are not earned based on results at the
close of the fiscal year in which the payment under this Agreement becomes due
will not be payable. Awards issued to the Executive shall immediately have all
restrictions removed.

 

14.                                 Amendment or Termination of this
Agreement.

 

(a)                                  Prior to the Occurrence of an Event. Prior to the occurrence of an Event,
the Company, by resolution of the Compensation Committee of the Board of
Directors, has the unilateral power to amend or terminate this Agreement at any
time and for any reason, and may do so without the Executive’s consent.
Notwithstanding the foregoing, however:

 

(1)                                  No such amendment or termination of this
Agreement shall be effective with respect to the Executive until two weeks
following the date that Executive is provided with written notice of the
change.

 

(2)                                  No such amendment or termination of this
Agreement shall be effective with respect to the Executive, unless otherwise
agreed by the Executive, if an Event occurs during the one-year period
following the date of adoption of the resolution amending or terminating this
Agreement.

 

(b)                                 After the Occurrence of an Event. After the occurrence of an Event, the
Company, by resolution of the Compensation Committee of the Board of Directors,
may amend or terminate this Agreement, but no such amendment or termination of
this Agreement shall be effective unless the Executive consents thereto in
writing.  Any waiver by an Executive of
rights of any benefits due under this agreement for any reason (rehire or
other) must be express and in writing.

 

IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
set out above.

 

 

	
  EXECUTIVE

  	
   

  	
  HICKORYTECH CORPORATION

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Damon D. Dutz

  	
   

  	
  By:

  	
   /s/ John W.
  Finke

  
	
  Damon D. Dutz

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its:

  	
   President and
  Chief Executive Officer

  

 

6Exhibit 10.21

 

Amendment
to

John
W. Finke Employment Agreement of August 1, 2006

 

On August 1, 2006
HickoryTech Corporation and John W. Finke entered into an Employment Agreement
(“Agreement”). This letter serves as an Amendment to that August 1, 2006
Agreement.

 

The following Amendment
will become effective November 29, 2007. Section 3.4 of the Agreement
will be modified to read:

 

3.4                                 Compensation Upon Termination.

 

a.)           Severance. In the event the Company terminates this Agreement
without Cause, or in the event Executive terminates this Agreement for Good
Reason, Executive shall be entitled to receive: (i) Executive’s then
current Base Salary through the Date of Termination, and (ii) a severance
payment equal to eighteen (18) months of Executive’s then current Base Salary
to be made in a lump sum payment on the first regular payday following the six
month anniversary of the Executive’s termination of employment and the
expiration of the revocation period in Executive’s Release (as provided in Section 3.4(c) below)
without any revocation having occurred. For purposes of this Section 3.4(a) a
termination of employment shall mean a separation from services as that term is
defined under Section 409A of the Code. In the event this Agreement is
terminated for any reason other than by the Company without Cause, or by
Executive for Good Reason, Executive shall not be entitled to the continuation
of any compensation, bonuses or benefits provided hereunder, or any other
payments following the Date of Termination, other than the then current Base
Salary earned through such Date of Termination.

 

In witness whereof, the
parties have executed this Amendment on November 29, 2007.

 

IN WITNESS WHEREOF, the parties have executed this
Amendment on November 29, 2007.

 

	
   

  	
  HICKORYTECH CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ R. Wynn
  Kearney, Jr.

  
	
   

  	
   

  
	
   

  	
  Its:

  	
  Board Chair

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   /s/ John W. Finke

  
	
   

  	
  JOHN
  W. FINKE

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