Document:

Exhibit 10.2

 

Exhibit 10.2

AMENDED AND RESTATED

CHANGE IN CONTROL AGREEMENT

     THIS AMENDED AND RESTATED CHANGE IN CONTROL AGREEMENT (the “Agreement”) is made and entered
into as of the 22nd day of February, 2007, by and between CT COMMUNICATIONS, INC., a North Carolina
corporation (the “Company”) , and Ronald A. Marino, an individual residing in Iredell County, North
Carolina (“Employee”);

     WHEREAS, the Company and the Employee have previously entered into a Change in Control
Agreement dated March 7, 2003, which agreement was subsequently amended as of August 17, 2005 (the
“Original Agreement”); and

     WHEREAS, the parties desire to amend the Original Agreement to (i) change the period during
which severance benefits are paid and the non-competition provisions apply, (ii) add a general
release as a condition to receiving benefits, and (iii) make other revisions as necessary to comply
with the requirements of Internal Revenue Code Section 409A or other applicable law; and

     WHEREAS, the parties agree that the best way to accomplish these changes is to restate the
Original Agreement in its entirety;

     NOW, THEREFORE, in consideration of the terms contained herein, including the compensation the
Company agrees to pay to the Employee upon certain events, the Employee’s employment with the
Company, the Employee’s covenants contained in this Agreement and other good and valuable
considerations, the receipt and sufficiency of which are hereby acknowledged, the Company and the
Employee agree as follows:

I. TERMINATION FOLLOWING A CHANGE IN CONTROL

     A. If a Change in Control (as defined in Section IA(iii) hereof) occurs and if,
within two years following the Change in Control, the employment of the Employee is terminated (A)
by the Company other than for Cause (as defined in Section IA(i) hereof), or (B) by the Employee
for Good Reason (as defined in Section IA(ii) hereof), subject to the Company’s receipt from the
Employee of the waiver and release as described in Section IJ below, an amount equal to the product
of 1.5 times the Employee’s Compensation (as defined in Section IA(iv) hereof), less applicable
withholdings, shall be paid by the Company to the Employee in a single lump sum within 30 days of
termination of the Employee’s employment under circumstances entitling the Employee to Compensation
hereunder.

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

	 	(i)	 	Cause. Termination by the Company for “Cause” shall mean termination with the
approval of the Board (a) because of willful misconduct of a material nature by the
Employee in connection with the performance of his duties as an employee; (b) because
of the Employee’s use of alcohol or illegal drugs that affects his ability to perform
his assigned duties as an employee; (c) because of the Employee’s conviction of a
felony or serious misdemeanor involving moral turpitude; (d) because of the Employee’s
embezzlement or theft from the Company; (e) because of the Employee’s gross inattention
to or dereliction of duty; or (f) because of performance by the Employee of any other
willful act(s) which the Employee knew or reasonably should have known would be
materially detrimental to the Company; provided, however, that prior to
the determination by the Board that “Cause” as described in (a), (e) or (f) above has
occurred, the Board shall (1) provide to the Employee in writing, in reasonable detail,
the reasons for the Board’s determination that such “Cause” exists, (2) afford the
Employee a reasonable opportunity to remedy any such breach, (3) provide the Employee
an opportunity to be heard at the Board meeting where the final decision to terminate
the Employee’s employment hereunder for such “Cause” is to be considered, and (4) make
any decision that such “Cause” exists in good faith.

 

 

	 	(ii)	 	Good Reason. Termination by the Employee for “Good Reason” shall mean (a) a
material reduction in the Employee’s position, duties, responsibilities or status as in
effect immediately preceding the Change in Control, or a change in the Employee’s title
resulting in a material reduction in his responsibilities or position with the Company
as in effect immediately preceding the Change in Control, in either case without the
Employee’s consent, but excluding for this purpose any isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied promptly by the Company
after receiving notice from the Employee and further excluding any such reductions or
changes made in good faith to conform with generally accepted industry standards for
the Employee’s position; (b) a reduction in the rate of the Employee’s base salary as
in effect immediately preceding the Change in Control or a decrease in any bonus amount
to which the Employee was entitled pursuant to the Company’s bonus or incentive plans
at the end of the fiscal year immediately preceding the Change in Control, in either
case without the Employee’s consent; provided, however, that a decrease
in the Employee’s bonus amount shall not constitute “Good Reason” and nothing herein
shall be construed to guarantee such bonus awards if performance, either by the Company
or the Employee, is below such targets as may reasonably and in good faith be set forth
in such bonus or incentive plans; or (c)the relocation of the Employee, without his
consent, to a location outside a 30 mile radius of Concord, North Carolina, following a
Change in Control.

	 
	 	(iii)	 	Change in Control. For purposes of this Agreement, “Change in Control”
shall mean (a) the consummation of a merger, consolidation, share exchange or similar
transaction of the Company with any other corporation, entity or group, as a result of
which the holders of the voting capital stock of the Company as a group would receive
less than 50% of the voting capital stock of the surviving or resulting corporation;
(b) the consummation of an agreement providing for the sale or transfer (other than as
security for obligations of the Company) of substantially all the assets of the
Company; or (c) in the absence of a prior expression of approval by the Board, the
acquisition except by inheritance or devise of more than 20% of the Company’s voting
capital stock by any person within the meaning of Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended, other than a person, or group including a person, who
beneficially owned, as of the date of this Agreement, more than 5% of the Company’s
voting stock or equity, except that transactions between the Company and any affiliate
or subsidiary of the Company and transactions between the Company and any employee
stock ownership plan shall not be deemed a “Change in Control” as described in (a), (b)
or (c) above.

	 
	 	(iv)	 	Compensation. The Employee’s Compensation shall consist of the following:
(a) the Employee’s annual base salary, as paid by the Company, in effect immediately
preceding the Change in Control plus (b) an annual bonus equal to the average bonus
(calculated as a percentage of base salary, without regard to vesting schedules or
restrictions on the bonus compensation and converting all post-employment payments in
stock and stock options to a cash present value) paid by the Company for each one-year
performance period (often referred to as the “annual incentive program”) to the
Employee for the three (3) most recent fiscal years ending prior to such Change in
Control pursuant to the Company’s incentive and bonus plans or, if the relevant bonus
program has not existed for three (3) years preceding the Change of Control, an amount
equal to the estimated average bonus as calculated by the independent accounting firm
then performing the Company’s independent audit, which calculation shall be conclusive.

     B. Subject to receipt of a waiver and release as described in Section IJ below, upon
termination of the Employee’s employment entitling the Employee to Compensation set forth in
Section IA hereof, and for the 18 month period following such termination of employment, the
Company shall:

	 	(i)	 	maintain in full force and effect for the continued benefit of the Employee
medical insurance (including coverage for the Employee’s dependents to the extent
dependent coverage is provided by the Company for its employees generally) under such
medical insurance plans and programs in which the Employee was entitled to participate
immediately prior to the date of such termination of employment, provided that the
Employee’s continued participation is possible under the general

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	 	 	 	terms and provisions of such plans and programs. During such period, the Company
will pay the Employee’s portion, if any, of such medical insurance premiums that may
be required, and the Employee’s termination of employment at the beginning of the
period shall not constitute a “qualifying event” under the Consolidated Omnibus
Budget Reconciliation Act of 1985 (“COBRA”). At the conclusion of such period, the
Employee shall be entitled to full rights to continued medical insurance coverage as
provided under COBRA, if eligible;

	 
	 	(ii)	 	permit the Employee to participate in all qualified retirement plans, including
without limitation the Company’s pension plan and salary-reduction defined contribution
plan;

	 
	 	(iii)	 	maintain in full force and effect for the continued benefit of the Employee
the Employee’s life insurance (both basic and supplemental, if applicable); and

	 
	 	(iv)	 	maintain in full force and effect for the continued benefit of the Employee the
Employee’s short term disability and long term disability insurance policies.

Provided, however, (a) in the event the Employee’s participation in any plan or
program listed in IB(i) through IB(iv) is barred for any reason, the Company shall arrange to
provide the Employee with such benefits for such period substantially similar to those which the
Employee would otherwise have been entitled to receive under such plans and programs from which his
continued participation is barred or pay to the Employee, at the same time the Employee is paid
Compensation in accordance with Section IA, a lump sum payment in cash equal to the value of the
benefits due to the Employee pursuant to Section IB(i) through IB(iv) that the Company is unable to
provide and (b) in no event shall the Employee receive from the Company the medical insurance
contemplated by Section IB(i) if the Employee receives comparable insurance from any other source.

     C. Upon termination of the Employee’s employment entitling the Employee to
Compensation as set forth in Section IA hereof, the Employee will become immediately vested in any
and all stock options and shares of restricted stock previously granted to him by the Company
notwithstanding any provision to the contrary of any plan under which the options or restricted
stock are granted. Any accrued but ungranted stock options or restricted stock shall also be fully
vested upon grant to the Employee. The Employee may exercise such options only at the times and in
the method described in such options. All restrictions on shares of the Company’s stock granted
under any plan shall lapse upon a Change of Control. The Company will amend such options or plans
in any manner necessary to facilitate the provisions of this Section IC.

     D. It is the intention of the Company and the Employee that no portion of the
payment made under this Agreement, or payments to or for the Employee under any other agreement or
plan, be deemed to be an excess parachute payment as defined in the Internal Revenue Code of 1986,
as amended (the “Code”) section 280G or any successor provision. The Company and the Employee agree
that the present value of any payment hereunder and any other payment to or for the benefit of the
Employee in the nature of compensation, receipt of which is contingent on a Change in Control of
the Company, and to which Code section 280G or any successor provision thereto applies, shall not
exceed an amount equal to one dollar less than the maximum amount that the Employee may receive
without becoming subject to the tax imposed by Code section 4999 or any successor provision or
which the Company may pay without loss of deduction under Code section 280G or any successor
provisions. Present value for purposes of this Agreement shall be calculated in accordance with
Code section 1274(b)(2) or any successor provision. In the event that the provisions of Code
sections 280G and 4999 or any successor provisions are repealed without succession, this Section ID
shall be of no further force or effect.

     E. The Company will require any successor (whether direct or indirect, by purchase,
merger, consolidation, share exchange or otherwise) to all or substantially all of the business
and/or assets of the Company, by agreement in form and substance satisfactory to the Employee, to
expressly assume 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. Failure of the
Company to obtain such agreement prior to the effectiveness of any such succession shall be a
breach of this Agreement and shall entitle the Employee to compensation from the Company in the
same amount and on the same terms as he would be entitled to hereunder if he terminated his
employment for Good Reason, except that for purposes of implementing the foregoing, the date on
which any such succession

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becomes effective shall be deemed the date the Employee’s employment was terminated. As used
in this Agreement, “Company” shall mean the Company as defined herein and any successor to its
business and/or assets as aforesaid that executes and delivers the agreement provided for in this
Section IE or that otherwise becomes bound by the all terms and provisions of this Agreement by
operation of law.

     F. Except as elected by the Employee with the prior consent of the Company, all
payments provided for under this Section I shall be paid in cash (including the cash values of
stock options or restricted stock, if any) from the general funds of the Company, and no special or
separate fund shall be established, and no other segregation of assets shall be made to assure
payment, except as provided to the contrary in funded benefits plans. The Employee shall have no
right, title or interest whatsoever in or to any investments that the Company may make to aid the
Company in meeting its obligations under this Section I. Nothing contained herein, and no action
taken pursuant to the provisions hereof, shall create or be construed to create a trust of any kind
or a fiduciary relationship between the Company and the Employee or any other person. To the
extent that any person acquires a right to receive payments from the Company hereunder, such right
shall be no greater than the right of an unsecured creditor of the Company.

     G. Following the Employee’s termination as a result of a Change in Control, the Corporation
agrees (i) to indemnify, defend and hold harmless the Employee from and against any liabilities
other than those contained in Section II and III hereof and crimes committed by the Employee
against the Company to which he may be subject as a result of his service as an officer or director
of the Company or as an officer or director of any of the Company’s subsidiaries or affiliates, and
(ii) to indemnify the Employee for all costs, including attorney’s fees and other professional fees
and disbursements, of (a) any legal action brought or threatened against him as a result of such
employment, or (b) any legal action in which the Employee is compelled to give testimony as a
result of his employment hereunder, to the fullest extent permitted by, and subject to the
limitations of, the laws of the state of North Carolina.

     H. In the event that any dispute shall arise between the Employee and the Company relating to
his rights under this Agreement following a Change in Control, and it is determined by agreement
between the parties, or by a final judgment of a court of competent jurisdiction that is no longer
subject to appeal, that the Employee has been substantially successful in his claims, then
reasonable legal fees and disbursements of the Employee in connection with such dispute shall be
paid by the Company.

     I. Following the employee’s termination as a result of a Change in Control, the Employee shall
be entitled to receive outplacement assistance for a period of six (6) months at the Company’s
expense.

     J. As a condition to the receipt of Compensation and other benefits pursuant to this
Agreement, the Employee must submit a signed Confidential Waiver and Release Agreement,
substantially in the form attached as Appendix A, within the time prescribed by the
Company.

     II. COVENANT NOT TO DISCLOSE CONFIDENTIAL INFORMATION

     A. The Employee understands that his position with the Company is one of trust and confidence
because of the Employee’s access to trade secrets and confidential and proprietary business
information. The Employee pledges his best efforts and utmost diligence to protect and keep
confidential the trade secrets and confidential or proprietary business information of the Company,
and that he shall use such information only for legitimate business purposes for the benefit of,
and expressly as authorized by, the Company.

     B. Unless required by the Company in connection with his employment or with the Company’s
express written consent, the Employee agrees that he will not, either during his employment or
afterwards, directly or indirectly:

     1. Misappropriate, use for the purpose of competing with the Company, either directly
or indirectly, disclose to any third party, either directly or indirectly, or aid anyone
else in disclosing to any third party, either directly or indirectly, for the Employee’s own
benefit or the benefit of another all or any

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part of any of the Company’s trade secrets or confidential or proprietary information,
whether or not the information is acquired, learned, or developed by the Employee alone or
in conjunction with others; and

     2. Use, disclose, divulge or communicate directly or indirectly to any
third party: (a) the names, addresses and other contact data regarding any
current or prospective customers of the Company; or (b) the details of any
contracts, business transactions or negotiation to which the Company is a
party or of any tenders, offers or proposals submitted or to be submitted by
the Company in connection with its business.

     The Employee makes the same pledge with regard to the confidential information of the
Company’s customers, contractors, or others with whom the Company has a business relationship.

     C. The Employee understands that trade secrets and confidential or proprietary information,
for purposes of this Agreement, shall include, but not be limited to, any and all versions of the
Company’s computer software, hardware, and documentation; all methods, processes, techniques,
practices, product designs, pricing information, billing histories, customer requirements, customer
lists, employee lists and salary/commission information, personnel matters, financial data,
operating results, plans, contractual relationships, and projections for business opportunities for
new or developing business of the Company; and all other confidential or proprietary information,
patents, ideas, know-how and trade secrets which are in the possession of the Company, no matter
what the source, including any such information that the Company obtains from a customer,
contractor or another party or entity and that the Company treats or designates as confidential or
proprietary information, whether or not such information is owned or was developed by the Company.

     D. The Employee also agrees that all notes, records (including all computer and electronic
records), software, drawings, handbooks, manuals, policies, contracts, memoranda, sales files,
customer lists, employee lists or other documents that are made or compiled by the Employee, or
which were available to the Employee while he was employed at the Company, in whatever form,
including but not limited to all such documents and data concerning any processes, inventions,
services or products used or developed by the Employee during his employment, shall be the property
of the Company. The Employee further agrees to deliver and make available all such documents and
data to the Company, regardless of how stored or maintained and including all originals, copies and
compilations thereof, upon the separation of his employment, for any reason, or at any other time
at the Company’s request.

     E. The Employee understands that the Company expects him to respect any trade secrets or
confidential information of any of the Employee’s former employers, business associates, or other
business relationships. The Employee also agrees to respect the Company’s express direction to the
Employee not to disclose to the Company, its officers, or any of its employees any such information
so long as it remains confidential.

     F. The Employee understands that the secrecy of certain communications is protected by state
and federal laws, and that violations of the Federal Communications Act may subject the Employee to
fines of up to $10,000, or imprisonment for up to ten years, or both. Therefore, the Employee
agrees that the following restrictions apply to all modes of communications during the duration of
the Employee’s employment with the Company:

     1. The Employee will not divulge to any unauthorized person any knowledge that he may
have regarding communication arrangements between the Company and its customers.

     2. Except as required by the daily performance of his duties, the Employee will not
give to any individual or group any information whatsoever regarding the location of
telecommunications equipment, trunks, cables, circuits, etc., or regarding the installation
of the Company’s central office equipment, or any information regarding the Company’s plant
or facilities.

     3. Except as required in the performance of his duties with the Company, the Employee
will not listen in on any telephone conversation in any form, nor disclose to any
unauthorized individual or

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group any part of any telephone conversation which the Employee may overhear in the
performance of his duties.

     4. The Employee will not discuss with his family, friends or acquaintances any
information gained through his employment with the Company regarding military installations,
communications, filter centers or other communication procedures and equipment relating to
national security.

     5. The Employee will not divulge to any unauthorized individual or group the existence,
substance, purport, effect of meaning of any communication between the Company’s customers.

     6. The Employee will promptly refer to his supervisor any unauthorized request
regarding telephone communications.

III. COVENANT NOT TO COMPETE

     A. For and in consideration of this Agreement, the change in control protection contained
herein, the Employee’s employment with the Company, and the Employee’s access to the confidential
information and trade secrets of the Company, the Employee agrees that, unless specifically
authorized by the Company in writing, the Employee will not for a period of 18 months after his
employment with the Company has terminated or ended (whatever the reason for the end of the
employment relationship):

     1. Engage in any “Competitive Activity” (as defined below) within the “Restricted
Territory” (as defined below); and/or

     2. Serve as an employee, director, owner, partner, contractor, consultant or agent of,
or own any interest in (except for ownership of a minor percentage of stock in a “public”
competitor), any person, firm or corporation that engages in “Competitive Activity” within
the “Restricted Territory”; and/or

     3. Engage in any “Competitive Activity” with, for or towards or divert, attempt to
divert or direct others to divert any business of the Company from a then existing Company
customer, a joint venturer or other business partner of the Company (hereinafter referred to
as an “affiliate”), or from a potential customer identified through leads or relationships
developed during the last twelve-month period before the end of the Employee’s employment
with the Company, within the “Restricted Territory”; and/or

     4. Engage in any “Competitive Activity” with, for or towards or divert, attempt to
divert or direct others to divert any business of the Company from a then existing Company
customer, a joint venturer or other business partner of the Company (hereinafter referred to
as an “affiliate”), who contacted the Employee, whom the Employee contacted or served, or
for whom the Employee supervised, managed or generally had executive oversight or input
concerning contact or service regarding the delivery, provision or sale of any Company
product or service during the last twelve-month period before the end of the Employee’s
employment with the Company.

     The Employee further agrees that, unless specifically authorized by the Company in writing, he
shall not engage in any “Competitive Activity” individually or with any entity or individual other
than the Company during his employment with the Company.

     B. Furthermore, the Employee will not during his employment with the Company and for a period
of 18 months after his employment with the Company has terminated or ended (whatever the reason for
the end of the employment relationship), solicit or hire for employment or as an independent
contractor any employee of the Company, or solicit, assist, induce, recruit, or assist or induce
anyone else to recruit or cause another person in the employ of the Company or any of the Company’s
affiliates to leave his employment with the Company or the Company’s affiliate for the purpose of
joining, associating, or becoming employed with any business or activity with which the Employee is
or expects to be directly or indirectly associated or employed.

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     C. “Competitive Activity” means: (1) the business activities engaged in by the Company during
the last twelve-month period before the end of the Employee’s employment with the Company,
including the sales, marketing, distribution and provision of telecommunications services,
equipment or other products of the type of which the Employee sold or was involved during the last
twelve-month period before the end of the Employee’s employment with the Company; and/or (2) the
performance of any other business activities competitive with the Company for or on behalf of any
telecommunications entity.

     D. “Restricted Territory” means: (1) the geographic area encompassing a seventy-five (75) mile
radius of Concord, North Carolina; and/or (2) the geographic area encompassing a seventy-five (75)
mile radius of any other area in which the Company conducts business in connection with its
“Greenfield” or other operations during the last twelve-month period before the end of the
Employee’s employment with the Company; and/or (3) any Metropolitan Statistical Area (as defined by
the United States Department of Commerce) from which the Company generated at least two percent
(2%) of its gross annual revenue during the last two calendar years before the end of the
Employee’s employment with the Company.

IV. ACKNOWLEDGMENTS BY EMPLOYEE

     A. The Employee acknowledges that the restrictions placed upon him by this Agreement are
reasonable given the nature of the Employee’s position with the Company, the area in which the
Company markets its products and services, and the consideration provided by the Company to the
Employee pursuant to this Agreement. Specifically, the Employee acknowledges that the length of
the Covenant Not to Compete in Section III is reasonable and that the definitions of “Competitive
Activity” and “Restricted Territory” are reasonable.

     B. The Employee agrees that in the event of any breach or threatened breach of the provisions
of Section II and III hereof or this provision IV by the Employee, the Company’s remedies at law
would be inadequate, and the Company shall be entitled to an injunction (without any bond or other
security being required), restraining such breach, and costs and attorneys’ fees relating to any
such proceeding or any other legal action to enforce the provisions of this Agreement, but nothing
herein shall be construed to preclude the Company from pursuing any other remedies at law or in
equity available to it for any such breach or threatened breach. Moreover, the Employee also
agrees that if the Employee breaches any of Sections II or III above or this provision IV, the
Employee shall be required to refund to the Company and the Company shall be entitled to recover of
the Employee 90% of the amount of the Employee’s Compensation (as defined in Section IA(iv) herein)
for a Change in Control already paid to the Employee by the Company under this Agreement at the
time of the breach, and the Employee shall forfeit at the time of the breach the right to any
additional payments or benefits under this Agreement, except that if the breach occurs before the
payment set forth in Section IA is made, the Employee shall be entitled to receive
[1/18th] of the payment set forth in Section IA, if generally eligible under Section I,
and nothing more. In such case, the Employee and the Company agree that the confidential
information and non-compete obligations contained in this Agreement shall remain valid and
enforceable based upon the consideration actually paid.

     C. The Employee acknowledges that all of the provisions of the Agreement are fair and
necessary to protect the interests of the Company. Accordingly, the Employee agrees not to contest
the validity or enforceability of Section II or Section III hereof and agrees that if any court
should hold any provision of Section II or Section III hereof to be unenforceable, the remaining
provisions will nonetheless be enforceable according to their terms. Further, if any provision or
subsection is held to be overly broad as written, the Employee agrees that a court should view the
above provisions and subsections as separable and uphold those separable provisions and subsections
deemed to be reasonable.

     D. The Employee understands that every provision of this Agreement is severable from each
other provision of this Agreement. Therefore, if any provision of this Agreement is held invalid
or unenforceable, every other provision of this Agreement will continue to be fully valid and
enforceable. In the event that any provision of this Agreement is determined by a court of
competent jurisdiction to be void or unenforceable, the Employee and the Company agree that such
provision shall be enforced to the extent reasonable under the circumstances and that all other
provisions shall be enforceable to the fullest extent permissible by law. The Employee and the
Company further agree that, if any court makes such a determination, such court shall have the
power to reduce the duration, scope and/or area of such provisions and/or delete specific words and
phrases by “blue penciling” and, in its reduced or blue penciled form, such provisions shall then
be enforceable as allowed by law.

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V. MISCELLANEOUS

     A. The Employee shall have no right to receive any payment hereunder except following a Change
of Control as determined pursuant to Section I. Nothing contained in this Agreement shall confer
upon the Employee any right to continued employment by the Company or shall interfere in any way
with the right of the Company to terminate his employment at any time for any/or no reason. The
provisions of this Agreement shall not affect in any way the right or power of the Company to
change its business structure or to effect a merger, consolidation, share exchange or similar
transaction, or to dissolve or liquidate, or sell or transfer all or part of its business or
assets.

     B. The Employee understands that his obligations under this Agreement will continue whether or
not his employment with the Company is terminated voluntarily or involuntarily, or with or without
cause.

     C. This Agreement replaces any previous agreement relating to the same or similar subject
matter which the Employee and the Company may have entered into with the Company with respect to
the Employee’s employment by the Company. This Agreement may not be changed in any detail other
than by a written agreement signed by the Employee and a Company officer, except the Company may
amend this Agreement from time to time without the Employee’s consent to the extent necessary to
comply with Section 409A of the Code and the valid and binding regulations and interpretations
thereunder, and the Employee understands and consents to any such amendment even though it may
reduce the benefits provided hereunder or may be otherwise unfavorable to the Employee.

     D. The Employee agrees that the Company’s waiver of any default by the Employer shall not
constitute a waiver of its rights under this Agreement with respect to any subsequent default by
the Employee. No waiver of any provision of this Agreement shall be valid unless in writing and
signed by all parties.

     E. This Agreement shall be binding upon, and inure to the benefit of, the Employee and the
Company and their respective permitted successors and assigns. Neither this Agreement nor any
right or interest hereunder shall be assignable by the Employee, his beneficiaries, or legal
representatives without the Company’s prior written consent.

     F. Where appropriate as used in this Plan, the masculine shall include the feminine.

     G. This Agreement has been executed and delivered in the State of North Carolina, and the laws
of the State of North Carolina shall govern its validity, interpretation, performance and
enforcement.

     IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto effective as of the
day and year first above stated.

	 	 	 	 	 
	 

	 	CT COMMUNICATIONS, INC.
	 	 
	 
	 	 	 	 
	 

	 	By:                                                             	 	 
	 
	 	 	 	 
	 

	 	EMPLOYEE:	 	 
	 
	 	 	 	 
	 

	 	                                                             (Seal)	 	 

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Appendix A

Change in Control Agreement

Waiver and Release Agreement

CONFIDENTIAL WAIVER AND RELEASE AGREEMENT

THIS
AGREEMENT is made this ___ day of ___, 200___, by and between CT
Communications, Inc., a North Carolina corporation (the “Company”), and
_______ (“Employee”).

WHEREAS, Employee is an employee of the Company; and

WHEREAS, Employee and the Company have entered into a Change in Control Agreement (the
“CIC Agreement”); and

WHEREAS, it is a condition to Employee’s receipt of the compensation and other
benefits under the CIC Agreement that s/he execute this Confidential Waiver and
Release Agreement (the “Release Agreement”); and

WHEREAS, Employee desires to receive the compensation and benefits under the CIC
Agreement and to comply with all conditions thereto, including execution of this
Release Agreement; and

WHEREAS, Employee has been allowed at least 21 days within which to consider this
Release Agreement;

NOW, THEREFORE, for good and valuable consideration, receipt and sufficiency of which
is hereby acknowledged, Employee and the Company hereby agree to the termination of
their employment relationship in accordance with the terms and conditions hereinafter
set forth:

1. Payment of Compensation and Other Benefits. In consideration of Employee’s
execution of, and his/her promises and releases contained in, this Agreement, the
Company will pay Employee the compensation and other benefits as provided in the CIC
Agreement (the “Severance Benefits”). The Severance Benefits shall be less applicable
taxes and withholdings required by law. The Company will pay Employee (or in the
event of the Employee’s death, his or her Beneficiary), the Severance Benefits (less
applicable taxes and withholdings) in a lump sum in cash after the Company receives
this Confidential Waiver and Release properly executed by Employee; provided, however,
that if Employee timely revokes this Confidential Waiver and Release Agreement after
executing it, in accordance with Section 8 below, Employee will not be paid the
Severance Benefits.

2. Release. In consideration for the Severance Benefits described above in
Section 1, Employee, for himself/herself, his/her heirs, executors, administrators,
and assigns, hereby releases, waives, and forever discharges any and all claims or
liabilities against the Company, its health or welfare benefits plans, affiliates,
predecessors, successors or assigns, and their respective officers, directors,
trustees, employees, representatives and agents, from any and all claims or
liabilities of whatever kind or nature which he/she has ever had or which he/she now
has, known or unknown, including, but not limited to, any and all claims or
counterclaims for breach of contract, breach of fiduciary duty, unfair competition,
defamation, wrongful or unlawful discharge, constructive discharge, for past or future
wages, salary, bonuses, earnings, restricted stock, deferred compensation or other
forms of compensation, claims or counterclaims for violations of Title VII of the
Civil Rights Act of 1964 as amended, 42 U.S.C. § 2000(e) et seq., the
Americans with Disabilities Act, or the Employee Retirement Income Security Act of
1974, any age discrimination claims under the Age Discrimination in Employment Act
(ADEA), 29 U.S.C. § 621 et  seq., as amended by the Older Workers
Benefit Protection Act (OWBPA) (these laws prohibit age discrimination in employment
or benefits as to individuals forty years of age and older), violations of any
federal, state and/or municipality whistle-blowing statutes or laws or fair employment
statutes or laws, or violations of any other law, rule, regulation, or ordinance
pertaining to employment, wages, hours, stock ownership, or any other terms and
conditions of employment and termination of employment, and any other claims,
counterclaims and/or third-party claims, which have been, or could have been, asserted
by Employee in any court, arbitration, or other forum arising out of or in any way
related to the relationship between Employee and Company or the termination thereof,
to the fullest extent permitted by law. (This release and waiver does not apply to
claims that may arise after the date you sign this Agreement or claims for the
enforcement of the Company’s obligations under the CIC Agreement.)

 

 

 NOTE: You have the right to consider this Agreement for twenty-one days before
accepting it. Before signing this Agreement, you are advised to consult with an
attorney of your choice, at your expense.

3. Confidentiality. The Company and Employee agree to keep the fact and
terms of this settlement in strict confidence. Employee agrees not to disclose this
document, its contents, or subject matter to any person other than his/her spouse (if
applicable), attorney, accountant, income tax preparer, or other similar
professionals. Furthermore, to the extent either party is permitted to disclose and
does disclose such information, they agree to require, and they warrant, that the
person receiving such information will maintain its confidentiality.

4. Nondisparagement. Employee also agrees that he/she will at all times
hereafter refrain from any conduct which is detrimental to the best interests of the
Company and its affiliates and their predecessors, successors, assigns, officers,
directors and agents, will refrain from making any disparaging, untrue, misleading or
similar statements or representations regarding Company, its affiliates and their
predecessors, successors, assigns, officers, directors and agents, whether orally or
in writing, including but not limited to comments about any of the Company’s services
or business practices, and will not disclose, use or communicate to any person, firm
or entity any confidential or proprietary information of the Company or its
affiliates, or information the disclosure of which might be harmful or damaging to
Company or its affiliates, which he/she learned or which came to his/her attention
during the course of his/her employment by Company.

5. No Admission. Employee understands and agrees that Company admits no
liability with respect to any claim related to, or arising out of, their relationship
or the termination thereof.

6. Entire Agreement/Severability. With the exception of any prior agreement
by the Employee to maintain the confidentiality of and not use or disclose the
Company’s confidential, proprietary or trade secret information, and with the
exception of the CIC Agreement, the terms of which shall survive and be in addition to
the terms of this Agreement, this Agreement contains the entire agreement between the
parties; and no agreements, representations, or statements of any party not contained
herein shall be binding on such party. The provisions of this Agreement are deemed
severable and the invalidity or unenforceability of any provision or part of this
Agreement in any respect shall not affect the validity or enforceability of this
Agreement in any other respect.

7. Controlling Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina, as they are applied to
contracts made and to be wholly performed in that state, regardless of choice of law
principles to the contrary. In addition, employee consents to the sole and exclusive
jurisdiction of any North Carolina court in any dispute arising from this Agreement.

8. Effective Date. This Agreement shall not become effective and enforceable
until after seven (7) days following its execution by Employee and may be revoked by
Employee at any time within the seven day period. Employee shall provide notice to the
Company no later than midnight on the last day of the seven-day revocation period.
Notice shall be given by submitting a written statement of revocation via hand
delivery, mail, or e-mail to ________ or ________. Notice may also be
given by calling or leaving a voice mail message for
________ at ________
before midnight on the last day of the seven-day revocation period, then immediately
confirming the call or message with written notice as stated above. Employee’s
revocation must be in writing to be effective. No attempted revocation after the
expiration of such seven (7) day period shall have any effect on the terms of this
Agreement.

9. Compliance with Older Workers Benefit Protection Act. By signing this
Agreement, Employee specifically acknowledges and represents that:

(a) Employee has been given a period of at least 21 days to consider the terms of this
Agreement;

(b) The terms of this Agreement are clear and understandable to Employee;

(c) The benefits Company will provide to Employee under the program exceed the
benefits that Employee was otherwise entitled to receive as an employee of Company;

(d) Employee has been advised to consult with an attorney (at Employee’s expense)
prior to signing this Agreement; and

 

 

(e) Employee has been advised that he/she has the right to revoke this Agreement at
any time within the seven-day period following his/her signature of this Agreement.

[Remainder of page intentionally left blank]

 

 

IN WITNESS WHEREOF, the Company and the Employee have executed this Agreement on the
day and year first written above.

EMPLOYEE:

                                                            

[INSERT EMPLOYEE NAME]

STATE OF                     

                    
COUNTY

     I, ________, a Notary Public of the aforesaid County and
State, do hereby certify that [INSERT EMPLOYEE NAME] personally appeared before me
this day and acknowledged that s/he:

     (1) Has read the foregoing instrument;

     (2) Has had an adequate opportunity to discuss the same with an attorney of his/her
own choosing if he wished to do so;

     (3) Understands that the foregoing instrument affects important rights;

     (4) Is acting
 freely and without undue influence or coercion; and

     (5) Signed the foregoing instrument.

     Witness my hand and notarial seal this ___ day of ___, 200___.

	 	 	 	 	 
	 

	 	 	 	 
	 

	 	Notary Public	 	 
	 
	 	 	 	 
	My Commission Expires:                     

	 	 	 	[notary seal]

COMPANY:

	 	 	 	 	 
	By:

	 	 	 	 
	 	 	 	 	 
	Name:
	 	 	 	 
	 	 	 	 	 
	Title:Exhibit 10.3

 

Exhibit 10.3

AMENDED AND RESTATED

CHANGE IN CONTROL AGREEMENT

     THIS AMENDED AND RESTATED CHANGE IN CONTROL AGREEMENT (the “Agreement”) is made and entered
into as of the 22nd day of February, 2007, by and between CT COMMUNICATIONS, INC., a North Carolina
corporation (the “Company”), and          , an individual residing in
Cabarrus County, North Carolina (“Employee”);

     WHEREAS, the Company and the Employee have previously entered into a Change in Control
Agreement dated December 29, 1998, which agreement was subsequently amended as of August 17, 2005
(the “Original Agreement”); and

     WHEREAS, the parties desire to amend the Original Agreement to (i) change the period during
which severance benefits are paid and the non-competition provisions apply, (ii) add a general
release as a condition to receiving benefits, and (iii) make other revisions as necessary to comply
with the requirements of Internal Revenue Code Section 409A or other applicable law; and

     WHEREAS, the parties agree that the best way to accomplish these changes is to restate the
Original Agreement in its entirety;

     NOW, THEREFORE, in consideration of the terms contained herein, including the compensation the
Company agrees to pay to the Employee upon certain events, the Employee’s employment with the
Company, the Employee’s covenants contained in this Agreement and other good and valuable
considerations, the receipt and sufficiency of which are hereby acknowledged, the Company and the
Employee agree as follows:

I. TERMINATION FOLLOWING A CHANGE IN CONTROL

     A. If a Change in Control (as defined in Section IA(iii) hereof) occurs and if,
within two years following the Change in Control, the employment of the Employee is terminated (A)
by the Company other than for Cause (as defined in Section IA(i) hereof), or (B) by the Employee
for Good Reason (as defined in Section IA(ii) hereof), subject to the Company’s receipt from the
Employee of the waiver and release as described in Section IJ below, an amount equal to the product
of 2 times the Employee’s Compensation (as defined in Section IA(iv) hereof), less applicable
withholdings, shall be paid by the Company to the Employee in a single lump sum within 30 days of
termination of the Employee’s employment under circumstances entitling the Employee to Compensation
hereunder.

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

	 	(i)	 	Cause. Termination by the Company for “Cause” shall mean termination with the
approval of the Board (a) because of willful misconduct of a material nature by the
Employee in connection with the performance of his duties as an employee; (b) because
of the Employee’s use of alcohol or illegal drugs that affects his ability to perform
his assigned duties as an employee; (c) because of the Employee’s conviction of a
felony or serious misdemeanor involving moral turpitude; (d) because of the Employee’s
embezzlement or theft from the Company; (e) because of the Employee’s gross inattention
to or dereliction of duty; or (f) because of performance by the Employee of any other
willful act(s) which the Employee knew or reasonably should have known would be
materially detrimental to the Company; provided, however, that prior to
the determination by the Board that “Cause” as described in (a), (e) or (f) above has
occurred, the Board shall (1) provide to the Employee in writing, in reasonable detail,
the reasons for the Board’s determination that such “Cause” exists, (2) afford the
Employee a reasonable opportunity to remedy any such breach, (3) provide the Employee
an opportunity to be heard at the Board meeting where the final decision to terminate
the Employee’s employment hereunder for such “Cause” is to be considered, and (4) make
any decision that such “Cause” exists in good faith.

 

 

	 	(ii)	 	Good Reason. Termination by the Employee for “Good Reason” shall mean (a) a
material reduction in the Employee’s position, duties, responsibilities or status as in
effect immediately preceding the Change in Control, or a change in the Employee’s title
resulting in a material reduction in his responsibilities or position with the Company
as in effect immediately preceding the Change in Control, in either case without the
Employee’s consent, but excluding for this purpose any isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied promptly by the Company
after receiving notice from the Employee and further excluding any such reductions or
changes made in good faith to conform with generally accepted industry standards for
the Employee’s position; (b) a reduction in the rate of the Employee’s base salary as
in effect immediately preceding the Change in Control or a decrease in any bonus amount
to which the Employee was entitled pursuant to the Company’s bonus or incentive plans
at the end of the fiscal year immediately preceding the Change in Control, in either
case without the Employee’s consent; provided, however, that a decrease
in the Employee’s bonus amount shall not constitute “Good Reason” and nothing herein
shall be construed to guarantee such bonus awards if performance, either by the Company
or the Employee, is below such targets as may reasonably and in good faith be set forth
in such bonus or incentive plans; or (c)the relocation of the Employee, without his
consent, to a location outside a 30 mile radius of Concord, North Carolina, following a
Change in Control.

	 
	 	(iii)	 	Change in Control. For purposes of this Agreement, “Change in Control”
shall mean (a) the consummation of a merger, consolidation, share exchange or similar
transaction of the Company with any other corporation, entity or group, as a result of
which the holders of the voting capital stock of the Company as a group would receive
less than 50% of the voting capital stock of the surviving or resulting corporation;
(b) the consummation of an agreement providing for the sale or transfer (other than as
security for obligations of the Company) of substantially all the assets of the
Company; or (c) in the absence of a prior expression of approval by the Board, the
acquisition except by inheritance or devise of more than 20% of the Company’s voting
capital stock by any person within the meaning of Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended, other than a person, or group including a person, who
beneficially owned, as of the date of this Agreement, more than 5% of the Company’s
voting stock or equity, except that transactions between the Company and any affiliate
or subsidiary of the Company and transactions between the Company and any employee
stock ownership plan shall not be deemed a “Change in Control” as described in (a), (b)
or (c) above.

	 
	 	 	 	(iv ) Compensation. The Employee’s Compensation shall consist of the following:
(a) the Employee’s annual base salary, as paid by the Company, in effect immediately
preceding the Change in Control plus (b) an annual bonus equal to the average bonus
(calculated as a percentage of base salary, without regard to vesting schedules or
restrictions on the bonus compensation and converting all post-employment payments in
stock and stock options to a cash present value) paid by the Company for each one-year
performance period (often referred to as the “annual incentive program”) to the
Employee for the three (3) most recent fiscal years ending prior to such Change in
Control pursuant to the Company’s incentive and bonus plans or, if the relevant bonus
program has not existed for three (3) years preceding the Change of Control, an amount
equal to the estimated average bonus as calculated by the independent accounting firm
then performing the Company’s independent audit, which calculation shall be conclusive.

     B. Subject to receipt of a waiver and release as described in Section IJ below, upon
termination of the Employee’s employment entitling the Employee to Compensation set forth in
Section IA hereof, and for the 24 month period following such termination of employment, the
Company shall:

	 	(i)	 	maintain in full force and effect for the continued benefit of the Employee
medical insurance (including coverage for the Employee’s dependents to the extent
dependent coverage is provided by the Company for its employees generally) under such
medical insurance plans and programs in which the Employee was entitled to participate
immediately prior to the date of such termination of employment, provided that the
Employee’s continued participation is possible under the general

2

 

	 	 	 	terms and provisions of such plans and programs. During such period, the Company
will pay the Employee’s portion, if any, of such medical insurance premiums that may
be required, and the Employee’s termination of employment at the beginning of the
period shall not constitute a “qualifying event” under the Consolidated Omnibus
Budget Reconciliation Act of 1985 (“COBRA”). At the conclusion of such period, the
Employee shall be entitled to full rights to continued medical insurance coverage as
provided under COBRA, if eligible;

	 	(ii)	 	permit the Employee to participate in all qualified retirement plans, including
without limitation the Company’s pension plan and salary-reduction defined contribution
plan;

	 
	 	(iii)	 	maintain in full force and effect for the continued benefit of the Employee
the Employee’s life insurance (both basic and supplemental, if applicable); and

	 
	 	(iv)	 	maintain in full force and effect for the continued benefit of the Employee the
Employee’s short term disability and long term disability insurance policies.

Provided, however, (a) in the event the Employee’s participation in any plan or
program listed in IB(i) through IB(iv) is barred for any reason, the Company shall arrange to
provide the Employee with such benefits for such period substantially similar to those which the
Employee would otherwise have been entitled to receive under such plans and programs from which his
continued participation is barred or pay to the Employee, at the same time the Employee is paid
Compensation in accordance with Section IA, a lump sum payment in cash equal to the value of the
benefits due to the Employee pursuant to Section IB(i) through IB(iv) that the Company is unable to
provide and (b) in no event shall the Employee receive from the Company the medical insurance
contemplated by Section IB(i) if the Employee receives comparable insurance from any other source.

     C. Upon termination of the Employee’s employment entitling the Employee to
Compensation as set forth in Section IA hereof, the Employee will become immediately vested in any
and all stock options and shares of restricted stock previously granted to him by the Company
notwithstanding any provision to the contrary of any plan under which the options or restricted
stock are granted. Any accrued but ungranted stock options or restricted stock shall also be fully
vested upon grant to the Employee. The Employee may exercise such options only at the times and in
the method described in such options. All restrictions on shares of the Company’s stock granted
under any plan shall lapse upon a Change of Control. The Company will amend such options or plans
in any manner necessary to facilitate the provisions of this Section IC.

     D. It is the intention of the Company and the Employee that no portion of the
payment made under this Agreement, or payments to or for the Employee under any other agreement or
plan, be deemed to be an excess parachute payment as defined in the Internal Revenue Code of 1986,
as amended (the “Code”) section 280G or any successor provision. The Company and the Employee agree
that the present value of any payment hereunder and any other payment to or for the benefit of the
Employee in the nature of compensation, receipt of which is contingent on a Change in Control of
the Company, and to which Code section 280G or any successor provision thereto applies, shall not
exceed an amount equal to one dollar less than the maximum amount that the Employee may receive
without becoming subject to the tax imposed by Code section 4999 or any successor provision or
which the Company may pay without loss of deduction under Code section 280G or any successor
provisions. Present value for purposes of this Agreement shall be calculated in accordance with
Code section 1274(b)(2) or any successor provision. In the event that the provisions of Code
sections 280G and 4999 or any successor provisions are repealed without succession, this Section ID
shall be of no further force or effect.

     E. The Company will require any successor (whether direct or indirect, by purchase,
merger, consolidation, share exchange or otherwise) to all or substantially all of the business
and/or assets of the Company, by agreement in form and substance satisfactory to the Employee, to
expressly assume 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. Failure of the
Company to obtain such agreement prior to the effectiveness of any such succession shall be a
breach of this Agreement and shall entitle the Employee to compensation from the Company in the
same amount and on the same terms as he would be entitled to hereunder if he terminated his
employment for Good Reason, except that for purposes of implementing the foregoing, the date on
which any such succession

3

 

becomes effective shall be deemed the date the Employee’s employment was terminated. As used
in this Agreement, “Company” shall mean the Company as defined herein and any successor to its
business and/or assets as aforesaid that executes and delivers the agreement provided for in this
Section IE or that otherwise becomes bound by the all terms and provisions of this Agreement by
operation of law.

     F. Except as elected by the Employee with the prior consent of the Company, all
payments provided for under this Section I shall be paid in cash (including the cash values of
stock options or restricted stock, if any) from the general funds of the Company, and no special or
separate fund shall be established, and no other segregation of assets shall be made to assure
payment, except as provided to the contrary in funded benefits plans. The Employee shall have no
right, title or interest whatsoever in or to any investments that the Company may make to aid the
Company in meeting its obligations under this Section I. Nothing contained herein, and no action
taken pursuant to the provisions hereof, shall create or be construed to create a trust of any kind
or a fiduciary relationship between the Company and the Employee or any other person. To the
extent that any person acquires a right to receive payments from the Company hereunder, such right
shall be no greater than the right of an unsecured creditor of the Company.

     G. Following the Employee’s termination as a result of a Change in Control, the Corporation
agrees (i) to indemnify, defend and hold harmless the Employee from and against any liabilities
other than those contained in Section II and III hereof and crimes committed by the Employee
against the Company to which he may be subject as a result of his service as an officer or director
of the Company or as an officer or director of any of the Company’s subsidiaries or affiliates, and
(ii) to indemnify the Employee for all costs, including attorney’s fees and other professional fees
and disbursements, of (a) any legal action brought or threatened against him as a result of such
employment, or (b) any legal action in which the Employee is compelled to give testimony as a
result of his employment hereunder, to the fullest extent permitted by, and subject to the
limitations of, the laws of the state of North Carolina.

     H. In the event that any dispute shall arise between the Employee and the Company relating to
his rights under this Agreement following a Change in Control, and it is determined by agreement
between the parties, or by a final judgment of a court of competent jurisdiction that is no longer
subject to appeal, that the Employee has been substantially successful in his claims, then
reasonable legal fees and disbursements of the Employee in connection with such dispute shall be
paid by the Company.

     I. Following the employee’s termination as a result of a Change in Control, the Employee shall
be entitled to receive outplacement assistance for a period of six (6) months at the Company’s
expense.

     J. As a condition to the receipt of Compensation and other benefits pursuant to this
Agreement, the Employee must submit a signed Confidential Waiver and Release Agreement,
substantially in the form attached as Appendix A, within the time prescribed by the
Company.

     II. COVENANT NOT TO DISCLOSE CONFIDENTIAL INFORMATION

     A. The Employee understands that his position with the Company is one of trust and confidence
because of the Employee’s access to trade secrets and confidential and proprietary business
information. The Employee pledges his best efforts and utmost diligence to protect and keep
confidential the trade secrets and confidential or proprietary business information of the Company,
and that he shall use such information only for legitimate business purposes for the benefit of,
and expressly as authorized by, the Company.

     B. Unless required by the Company in connection with his employment or with the Company’s
express written consent, the Employee agrees that he will not, either during his employment or
afterwards, directly or indirectly:

     1. Misappropriate, use for the purpose of competing with the Company, either directly
or indirectly, disclose to any third party, either directly or indirectly, or aid anyone
else in disclosing to any third party, either directly or indirectly, for the Employee’s own
benefit or the benefit of another all or any

4

 

part of any of the Company’s trade secrets or confidential or proprietary information,
whether or not the information is acquired, learned, or developed by the Employee alone or
in conjunction with others; and

     2. Use, disclose, divulge or communicate directly or indirectly to any
third party: (a) the names, addresses and other contact data regarding any
current or prospective customers of the Company; or (b) the details of any
contracts, business transactions or negotiation to which the Company is a
party or of any tenders, offers or proposals submitted or to be submitted by
the Company in connection with its business.

     The Employee makes the same pledge with regard to the confidential information of the
Company’s customers, contractors, or others with whom the Company has a business relationship.

     C. The Employee understands that trade secrets and confidential or proprietary information,
for purposes of this Agreement, shall include, but not be limited to, any and all versions of the
Company’s computer software, hardware, and documentation; all methods, processes, techniques,
practices, product designs, pricing information, billing histories, customer requirements, customer
lists, employee lists and salary/commission information, personnel matters, financial data,
operating results, plans, contractual relationships, and projections for business opportunities for
new or developing business of the Company; and all other confidential or proprietary information,
patents, ideas, know-how and trade secrets which are in the possession of the Company, no matter
what the source, including any such information that the Company obtains from a customer,
contractor or another party or entity and that the Company treats or designates as confidential or
proprietary information, whether or not such information is owned or was developed by the Company.

     D. The Employee also agrees that all notes, records (including all computer and electronic
records), software, drawings, handbooks, manuals, policies, contracts, memoranda, sales files,
customer lists, employee lists or other documents that are made or compiled by the Employee, or
which were available to the Employee while he was employed at the Company, in whatever form,
including but not limited to all such documents and data concerning any processes, inventions,
services or products used or developed by the Employee during his employment, shall be the property
of the Company. The Employee further agrees to deliver and make available all such documents and
data to the Company, regardless of how stored or maintained and including all originals, copies and
compilations thereof, upon the separation of his employment, for any reason, or at any other time
at the Company’s request.

     E. The Employee understands that the Company expects him to respect any trade secrets or
confidential information of any of the Employee’s former employers, business associates, or other
business relationships. The Employee also agrees to respect the Company’s express direction to the
Employee not to disclose to the Company, its officers, or any of its employees any such information
so long as it remains confidential.

     F. The Employee understands that the secrecy of certain communications is protected by state
and federal laws, and that violations of the Federal Communications Act may subject the Employee to
fines of up to $10,000, or imprisonment for up to ten years, or both. Therefore, the Employee
agrees that the following restrictions apply to all modes of communications during the duration of
the Employee’s employment with the Company:

     1. The Employee will not divulge to any unauthorized person any knowledge that he may
have regarding communication arrangements between the Company and its customers.

     2. Except as required by the daily performance of his duties, the Employee will not
give to any individual or group any information whatsoever regarding the location of
telecommunications equipment, trunks, cables, circuits, etc., or regarding the installation
of the Company’s central office equipment, or any information regarding the Company’s plant
or facilities.

     3. Except as required in the performance of his duties with the Company, the Employee
will not listen in on any telephone conversation in any form, nor disclose to any
unauthorized individual or

5

 

group any part of any telephone conversation which the Employee may overhear in the
performance of his duties.

     4. The Employee will not discuss with his family, friends or acquaintances any
information gained through his employment with the Company regarding military installations,
communications, filter centers or other communication procedures and equipment relating to
national security.

     5. The Employee will not divulge to any unauthorized individual or group the existence,
substance, purport, effect of meaning of any communication between the Company’s customers.

     6. The Employee will promptly refer to his supervisor any unauthorized request
regarding telephone communications.

III. COVENANT NOT TO COMPETE

     A. For and in consideration of this Agreement, the change in control protection contained
herein, the Employee’s employment with the Company, and the Employee’s access to the confidential
information and trade secrets of the Company, the Employee agrees that, unless specifically
authorized by the Company in writing, the Employee will not for a period of 24 months after his
employment with the Company has terminated or ended (whatever the reason for the end of the
employment relationship):

     1. Engage in any “Competitive Activity” (as defined below) within the “Restricted
Territory” (as defined below); and/or

     2. Serve as an employee, director, owner, partner, contractor, consultant or agent of,
or own any interest in (except for ownership of a minor percentage of stock in a “public”
competitor), any person, firm or corporation that engages in “Competitive Activity” within
the “Restricted Territory”; and/or

     3. Engage in any “Competitive Activity” with, for or towards or divert, attempt to
divert or direct others to divert any business of the Company from a then existing Company
customer, a joint venturer or other business partner of the Company (hereinafter referred to
as an “affiliate”), or from a potential customer identified through leads or relationships
developed during the last twelve-month period before the end of the Employee’s employment
with the Company, within the “Restricted Territory”; and/or

     4. Engage in any “Competitive Activity” with, for or towards or divert, attempt to
divert or direct others to divert any business of the Company from a then existing Company
customer, a joint venturer or other business partner of the Company (hereinafter referred to
as an “affiliate”), who contacted the Employee, whom the Employee contacted or served, or
for whom the Employee supervised, managed or generally had executive oversight or input
concerning contact or service regarding the delivery, provision or sale of any Company
product or service during the last twelve-month period before the end of the Employee’s
employment with the Company.

     The Employee further agrees that, unless specifically authorized by the Company in writing, he
shall not engage in any “Competitive Activity” individually or with any entity or individual other
than the Company during his employment with the Company.

     B. Furthermore, the Employee will not during his employment with the Company and for a period
of 24 months after his employment with the Company has terminated or ended (whatever the reason for
the end of the employment relationship), solicit or hire for employment or as an independent
contractor any employee of the Company, or solicit, assist, induce, recruit, or assist or induce
anyone else to recruit or cause another person in the employ of the Company or any of the Company’s
affiliates to leave his employment with the Company or the Company’s affiliate for the purpose of
joining, associating, or becoming employed with any business or activity with which the Employee is
or expects to be directly or indirectly associated or employed.

6

 

     C. “Competitive Activity” means: (1) the business activities engaged in by the Company during
the last twelve-month period before the end of the Employee’s employment with the Company,
including the sales, marketing, distribution and provision of telecommunications services,
equipment or other products of the type of which the Employee sold or was involved during the last
twelve-month period before the end of the Employee’s employment with the Company; and/or (2) the
performance of any other business activities competitive with the Company for or on behalf of any
telecommunications entity.

     D. “Restricted Territory” means: (1) the geographic area encompassing a seventy-five (75) mile
radius of Concord, North Carolina; and/or (2) the geographic area encompassing a seventy-five (75)
mile radius of any other area in which the Company conducts business in connection with its
“Greenfield” or other operations during the last twelve-month period before the end of the
Employee’s employment with the Company; and/or (3) any Metropolitan Statistical Area (as defined by
the United States Department of Commerce) from which the Company generated at least two percent
(2%) of its gross annual revenue during the last two calendar years before the end of the
Employee’s employment with the Company.

IV. ACKNOWLEDGMENTS BY EMPLOYEE

     A. The Employee acknowledges that the restrictions placed upon him by this Agreement are
reasonable given the nature of the Employee’s position with the Company, the area in which the
Company markets its products and services, and the consideration provided by the Company to the
Employee pursuant to this Agreement. Specifically, the Employee acknowledges that the length of
the Covenant Not to Compete in Section III is reasonable and that the definitions of “Competitive
Activity” and “Restricted Territory” are reasonable.

     B. The Employee agrees that in the event of any breach or threatened breach of the provisions
of Section II and III hereof or this provision IV by the Employee, the Company’s remedies at law
would be inadequate, and the Company shall be entitled to an injunction (without any bond or other
security being required), restraining such breach, and costs and attorneys’ fees relating to any
such proceeding or any other legal action to enforce the provisions of this Agreement, but nothing
herein shall be construed to preclude the Company from pursuing any other remedies at law or in
equity available to it for any such breach or threatened breach. Moreover, the Employee also
agrees that if the Employee breaches any of Sections II or III above or this provision IV, the
Employee shall be required to refund to the Company and the Company shall be entitled to recover of
the Employee 90% of the amount of the Employee’s Compensation (as defined in Section IA(iv) herein)
for a Change in Control already paid to the Employee by the Company under this Agreement at the
time of the breach, and the Employee shall forfeit at the time of the breach the right to any
additional payments or benefits under this Agreement, except that if the breach occurs before the
payment set forth in Section IA is made, the Employee shall be entitled to receive
1/24th of the payment set forth in Section IA, if generally eligible under Section I,
and nothing more. In such case, the Employee and the Company agree that the confidential
information and non-compete obligations contained in this Agreement shall remain valid and
enforceable based upon the consideration actually paid.

     C. The Employee acknowledges that all of the provisions of the Agreement are fair and
necessary to protect the interests of the Company. Accordingly, the Employee agrees not to contest
the validity or enforceability of Section II or Section III hereof and agrees that if any court
should hold any provision of Section II or Section III hereof to be unenforceable, the remaining
provisions will nonetheless be enforceable according to their terms. Further, if any provision or
subsection is held to be overly broad as written, the Employee agrees that a court should view the
above provisions and subsections as separable and uphold those separable provisions and subsections
deemed to be reasonable.

     D. The Employee understands that every provision of this Agreement is severable from each
other provision of this Agreement. Therefore, if any provision of this Agreement is held invalid
or unenforceable, every other provision of this Agreement will continue to be fully valid and
enforceable. In the event that any provision of this Agreement is determined by a court of
competent jurisdiction to be void or unenforceable, the Employee and the Company agree that such
provision shall be enforced to the extent reasonable under the circumstances and that all other
provisions shall be enforceable to the fullest extent permissible by law. The Employee and the
Company further agree that, if any court makes such a determination, such court shall have the
power to reduce the duration, scope and/or area of such provisions and/or delete specific words and
phrases by “blue penciling” and, in its reduced or blue penciled form, such provisions shall then
be enforceable as allowed by law.

7

 

V. MISCELLANEOUS

     A. The Employee shall have no right to receive any payment hereunder except following a Change
of Control as determined pursuant to Section I. Nothing contained in this Agreement shall confer
upon the Employee any right to continued employment by the Company or shall interfere in any way
with the right of the Company to terminate his employment at any time for any/or no reason. The
provisions of this Agreement shall not affect in any way the right or power of the Company to
change its business structure or to effect a merger, consolidation, share exchange or similar
transaction, or to dissolve or liquidate, or sell or transfer all or part of its business or
assets.

     B. The Employee understands that his obligations under this Agreement will continue whether or
not his employment with the Company is terminated voluntarily or involuntarily, or with or without
cause.

     C. This Agreement replaces any previous agreement relating to the same or similar subject
matter which the Employee and the Company may have entered into with the Company with respect to
the Employee’s employment by the Company. This Agreement may not be changed in any detail other
than by a written agreement signed by the Employee and a Company officer, except the Company may
amend this Agreement from time to time without the Employee’s consent to the extent necessary to
comply with Section 409A of the Code and the valid and binding regulations and interpretations
thereunder, and the Employee understands and consents to any such amendment even though it may
reduce the benefits provided hereunder or may be otherwise unfavorable to the Employee.

     D. The Employee agrees that the Company’s waiver of any default by the Employer shall not
constitute a waiver of its rights under this Agreement with respect to any subsequent default by
the Employee. No waiver of any provision of this Agreement shall be valid unless in writing and
signed by all parties.

     E. This Agreement shall be binding upon, and inure to the benefit of, the Employee and the
Company and their respective permitted successors and assigns. Neither this Agreement nor any
right or interest hereunder shall be assignable by the Employee, his beneficiaries, or legal
representatives without the Company’s prior written consent.

     F. Where appropriate as used in this Plan, the masculine shall include the feminine.

     G. This Agreement has been executed and delivered in the State of North Carolina, and the laws
of the State of North Carolina shall govern its validity, interpretation, performance and
enforcement.

     IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto effective as of the
day and year first above stated.

	 	 	 	 	 
	 

	 	CT COMMUNICATIONS, INC.
	 	 
	 
	 	 	 	 
	 

	 	By:                                                             	 	 
	 
	 	 	 	 
	 

	 	EMPLOYEE:	 	 
	 
	 	 	 	 
	 

	 	                                                             (Seal)	 	 

8

 

Appendix A

Change in Control Agreement

Waiver and Release Agreement

CONFIDENTIAL WAIVER AND RELEASE AGREEMENT

THIS
AGREEMENT is made this ___ day of ___, 200___, by and between CT
Communications, Inc., a North Carolina corporation (the “Company”), and
_________  (“Employee”).

WHEREAS, Employee is an employee of the Company; and

WHEREAS, Employee and the Company have entered into a Change in Control Agreement
(the “CIC Agreement”); and

WHEREAS, it is a condition to Employee’s receipt of the compensation and other
benefits under the CIC Agreement that s/he execute this Confidential Waiver and
Release Agreement (the “Release Agreement”); and

WHEREAS, Employee desires to receive the compensation and benefits under the CIC
Agreement and to comply with all conditions thereto, including execution of this
Release Agreement; and

WHEREAS, Employee has been allowed at least 21 days within which to consider this
Release Agreement;

NOW, THEREFORE, for good and valuable consideration, receipt and sufficiency of which
is hereby acknowledged, Employee and the Company hereby agree to the termination of
their employment relationship in accordance with the terms and conditions hereinafter
set forth:

1. Payment of Compensation and Other Benefits. In consideration of Employee’s
execution of, and his/her promises and releases contained in, this Agreement, the
Company will pay Employee the compensation and other benefits as provided in the CIC
Agreement (the “Severance Benefits”). The Severance Benefits shall be less
applicable taxes and withholdings required by law. The Company will pay Employee (or
in the event of the Employee’s death, his or her Beneficiary), the Severance Benefits
(less applicable taxes and withholdings) in a lump sum in cash after the Company
receives this Confidential Waiver and Release properly executed by Employee;
provided, however, that if Employee timely revokes this Confidential Waiver and
Release Agreement after executing it, in accordance with Section 8 below, Employee
will not be paid the Severance Benefits.

2. Release. In consideration for the Severance Benefits described above in
Section 1, Employee, for himself/herself, his/her heirs, executors, administrators,
and assigns, hereby releases, waives, and forever discharges any and all claims or
liabilities against the Company, its health or welfare benefits plans, affiliates,
predecessors, successors or assigns, and their respective officers, directors,
trustees, employees, representatives and agents, from any and all claims or
liabilities of whatever kind or nature which he/she has ever had or which he/she now
has, known or unknown, including, but not limited to, any and all claims or
counterclaims for breach of contract, breach of fiduciary duty, unfair competition,
defamation, wrongful or unlawful discharge, constructive discharge, for past or
future wages, salary, bonuses, earnings, restricted stock, deferred compensation or
other forms of compensation, claims or counterclaims for violations of Title VII of
the Civil Rights Act of 1964 as amended, 42 U.S.C. § 2000(e) et seq., the
Americans with Disabilities Act, or the Employee Retirement Income Security Act of
1974, any age discrimination claims under the Age Discrimination in Employment Act
(ADEA), 29 U.S.C. § 621 et  seq., as amended by the Older Workers
Benefit Protection Act (OWBPA) (these laws prohibit age discrimination in employment
or benefits as to individuals forty years of age and older), violations of any
federal, state and/or municipality whistle-blowing statutes or laws or fair
employment statutes or laws, or violations of any other law, rule, regulation, or
ordinance pertaining to employment, wages, hours, stock ownership, or any other terms
and conditions of employment and termination of employment, and any other claims,
counterclaims and/or third-party claims, which have been, or could have been,
asserted by Employee in any court, arbitration, or other forum arising out of or in
any way related to the relationship between Employee and Company or the termination
thereof, to the fullest extent permitted by law. (This release and waiver does not
apply to claims that may arise after the date you sign this Agreement or claims for
the enforcement of the Company’s obligations under the CIC Agreement.)

 

 

 NOTE: You have the right to consider this Agreement for twenty-one days before
accepting it. Before signing this Agreement, you are advised to consult with an
attorney of your choice, at your expense.

3. Confidentiality. The Company and Employee agree to keep the fact and
terms of this settlement in strict confidence. Employee agrees not to disclose this
document, its contents, or subject matter to any person other than his/her spouse (if
applicable), attorney, accountant, income tax preparer, or other similar
professionals. Furthermore, to the extent either party is permitted to disclose and
does disclose such information, they agree to require, and they warrant, that the
person receiving such information will maintain its confidentiality.

4. Nondisparagement. Employee also agrees that he/she will at all times
hereafter refrain from any conduct which is detrimental to the best interests of the
Company and its affiliates and their predecessors, successors, assigns, officers,
directors and agents, will refrain from making any disparaging, untrue, misleading or
similar statements or representations regarding Company, its affiliates and their
predecessors, successors, assigns, officers, directors and agents, whether orally or
in writing, including but not limited to comments about any of the Company’s services
or business practices, and will not disclose, use or communicate to any person, firm
or entity any confidential or proprietary information of the Company or its
affiliates, or information the disclosure of which might be harmful or damaging to
Company or its affiliates, which he/she learned or which came to his/her attention
during the course of his/her employment by Company.

5. No Admission. Employee understands and agrees that Company admits no
liability with respect to any claim related to, or arising out of, their relationship
or the termination thereof.

6. Entire Agreement/Severability. With the exception of any prior agreement
by the Employee to maintain the confidentiality of and not use or disclose the
Company’s confidential, proprietary or trade secret information, and with the
exception of the CIC Agreement, the terms of which shall survive and be in addition
to the terms of this Agreement, this Agreement contains the entire agreement between
the parties; and no agreements, representations, or statements of any party not
contained herein shall be binding on such party. The provisions of this Agreement
are deemed severable and the invalidity or unenforceability of any provision or part
of this Agreement in any respect shall not affect the validity or enforceability of
this Agreement in any other respect.

7. Controlling Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina, as they are applied to
contracts made and to be wholly performed in that state, regardless of choice of law
principles to the contrary. In addition, employee consents to the sole and exclusive
jurisdiction of any North Carolina court in any dispute arising from this Agreement.

8. Effective Date. This Agreement shall not become effective and enforceable
until after seven (7) days following its execution by Employee and may be revoked by
Employee at any time within the seven day period. Employee shall provide notice to
the Company no later than midnight on the last day of the seven-day revocation
period. Notice shall be given by submitting a written statement of revocation via
hand delivery, mail, or e-mail to
________ or ________. Notice may
also be given by calling or leaving a voice mail message for
________ at
________ before midnight on the last day of the seven-day revocation period,
then immediately confirming the call or message with written notice as stated above.
Employee’s revocation must be in writing to be effective. No attempted revocation
after the expiration of such seven (7) day period shall have any effect on the terms
of this Agreement.

9. Compliance with Older Workers Benefit Protection Act. By signing this
Agreement, Employee specifically acknowledges and represents that:

(a) Employee has been given a period of at least 21 days to consider the terms of
this Agreement;

(b) The terms of this Agreement are clear and understandable to Employee;

(c) The benefits Company will provide to Employee under the program exceed the
benefits that Employee was otherwise entitled to receive as an employee of Company;

(d) Employee has been advised to consult with an attorney (at Employee’s expense)
prior to signing this Agreement; and

 

 

(e) Employee has been advised that he/she has the right to revoke this Agreement at
any time within the seven-day period following his/her signature of this Agreement.

[Remainder of page intentionally left blank]

 

 

IN WITNESS WHEREOF, the Company and the Employee have executed this Agreement on the
day and year first written above.

EMPLOYEE:

                                                            

[INSERT EMPLOYEE NAME]

STATE OF                     

                     COUNTY

     I, ________, a Notary Public of the aforesaid County and
State, do hereby certify that [INSERT EMPLOYEE NAME] personally appeared before me
this day and acknowledged that s/he:

     (1) Has read the foregoing instrument;

     (2) Has had an adequate opportunity to discuss the same with an attorney of his/her
own choosing if he wished to do so;

     (3) Understan
ds that the foregoing instrument affects important rights;

     (4) Is acting
 freely and without undue influence or coercion; and

     (5) Signed th
e foregoing instrument.

     Witness my hand an
d notarial seal this ___ day of ___, 200___.

	 	 	 	 	 
	 

	 	 	 	 
	 

	 	Notary Public	 	 
	 
	 	 	 	 
	My Commission Expires:                     

	 	 	 	[notary seal]

COMPANY:

	 	 	 	 	 
	By:

	 	 	 	 
	 	 	 	 	 
	Name:
	 	 	 	 
	 	 	 	 	 
	Title:

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