Document:

exv10w7

Exhibit 10.7

INTELLECTUAL PROPERTY SECURITY AGREEMENT

     This Intellectual Property Security Agreement dated as of October 27, 2008 (“Security
Agreement”), is made by Avalon Pharmaceuticals, Inc., a Delaware corporation (“Grantor”),
in favor of Clinical Data, Inc. (“Secured Party”).

Recitals

     A. Secured Party has made or has agreed to make certain advances of money and to extend
certain financial accommodations to Grantor pursuant to that certain Note Purchase Agreement dated
of even date herewith between Grantor and Secured Party (as the same may be amended, the “Note
Purchase Agreement”) and as evidenced by that certain Term Note dated of even date herewith
executed by Grantor in favor of Secured Party and such other promissory notes which may be executed
by Grantor in favor of Secured Party after the date hereof (as each may be amended, individually,
the “Note” and, collectively, the “Notes”), such advances, future advances, and financial
accommodations being referred to herein as the “Loans”.

     B. Secured Party is willing to make the Loans to Grantor, but only upon the condition, among
others, that Grantor shall have executed and delivered to Secured Party this Security Agreement.

Agreement

     Now, Therefore, in order to induce Secured Party to make the Loans and for other good
and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and
intending to be legally bound, Grantor hereby represents, warrants, covenants and agrees as
follows:

     1. Defined Terms. Terms used but not otherwise defined herein shall have the
meanings given to them in the Note Purchase Agreement. When used in this Security Agreement the
following terms shall have the following meanings (such meanings being equally applicable to both
the singular and plural forms of the terms defined):

     “AvalonRx® Technology” shall have the meaning given such term in the License Agreement.

     “Bankruptcy Code” means Title XI of the United States Code.

     “Collateral” shall have the meaning assigned to such term in Section 2 of this Security
Agreement.

     “Contracts” means all contracts (including any customer, vendor, supplier, service or
maintenance contract), leases, licenses, undertakings, purchase orders, permits, franchise
agreements or other agreements, whether in written or electronic form, in or under which Grantor
now holds or hereafter acquires any right, title or interest, including, without limitation, with
respect to an account receivable, any agreement relating to the terms of payment or the terms of
performance thereof.

 

 

     “Copyright License” means any agreement, whether in written or electronic form, in which
Grantor now holds or hereafter acquires any interest, granting any right in or to any Copyright or
Copyright registration (whether Grantor is the licensee or the licensor thereunder) including,
without limitation, licenses pursuant to which Grantor has obtained the exclusive right to use a
copyright owned by a third party.

     “Copyrights” means all of the following now owned or hereafter acquired or created (as a work
for hire for the benefit of Grantor) by Grantor or in which Grantor now holds or hereafter acquires
or receives any right or interest, in whole or in part: (a) all copyrights, whether registered or
unregistered, held pursuant to the laws of the United States, any State thereof or any other
country; (b) registrations, applications, recordings and proceedings in the United States Copyright
Office or in any similar office or agency of the United States, any State thereof or any other
country; (c) any continuations, renewals or extensions thereof; (d) any registrations to be issued
in any pending applications, and shall include any right or interest in and to work protectable by
any of the foregoing which are presently or in the future owned, created or authorized (as a work
for hire for the benefit of Grantor) or acquired by Grantor, in whole or in part; (e) prior
versions of works covered by copyright and all works based upon, derived from or incorporating such
works; (f) income, royalties, damages, claims and payments now and hereafter due and/or payable
with respect to copyrights, including, without limitation, damages, claims and recoveries for past,
present or future infringement; (g) rights to sue for past, present and future infringements of any
copyright; and (h) any other rights corresponding to any of the foregoing rights throughout the
world.

     “Event of Default” means any “Event of Default” as defined in the Note Purchase Agreement.

     “General Intangible” means and includes any “general intangible,” as such term is defined in
Article 9 of the UCC, now owned or hereafter acquired or received by Grantor or in which Grantor
now holds or hereafter acquires or receives any right or interest, and shall include, in any event,
any Contract (including any License), Copyright, Trademark, Patent or other Intellectual Property,
Payment Intangible, books and records, ledger card, file, correspondence, computer program, tape,
disk and related data processing software that at any time evidences or contains information
relating to any of the Collateral, permit, goodwill (including the goodwill associated with any
Trademark, Trademark registration or Trademark licensed under any Trademark License), insurance
policy or any claim in or under any policy of insurance (including unearned premiums), chose in
action, judgment taken or any rights or claims included in the Collateral, any right to sue for
past, present and future infringement of any Copyright, Trademark, Patent, any right to any tax
refund of any kind from any governmental authority, any right to receive the proceeds of any
indemnity, warranty (including any manufacturer’s warranty) or guaranty (including any performance
guaranty) in favor of Grantor, any claim of Grantor arising out of any breach or default under any
Contract (including any License) or claim for damages arising out of such breach or default and any
right of Grantor to terminate, amend, supplement, modify or exercise rights, options or remedies
under any Contract (including any License).

     “Intellectual Property” means any intellectual property, in any medium, of any kind or nature
whatsoever, now or hereafter owned or acquired or received by Grantor or in which

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Grantor now holds or hereafter acquires or receives any right or interest, and shall include,
in any event, any Copyright, Trademark, Patent, trade secret, customer list, marketing plan,
internet domain name (including any right related to the registration thereof), proprietary or
confidential information, mask work, source, object or other programming code, invention (whether
or not patented or patentable), technical information, procedure, design, knowledge, know-how,
software, data base, data, skill, expertise, recipe, experience, process, model, drawing, material
or record.

     “License” means any Copyright License, Patent License, Trademark License or other license of
rights or interests, whether in-bound or out-bound, whether in written or electronic form, now or
hereafter owned or acquired or received by Grantor or in which Grantor now holds or hereafter
acquires or receives any right or interest, and shall include any renewals or extensions of any of
the foregoing thereof.

     “License Agreement” shall mean that certain AvalonRx® License Agreement between the Buyer and
Seller, dated on or about the date hereof, as amended.

     “Lien” means any mortgage, lien, deed of trust, charge, pledge, security interest or other
encumbrance.

     “Patent License” means any agreement, whether in written or electronic form, in which Grantor
now holds or hereafter acquires any interest, granting any right with respect to any invention on
which a Patent is in existence (whether Grantor is the licensee or the licensor thereunder).

     “Patents” means all of the following in which Grantor now holds or hereafter acquires any
interest: (a) all letters patent of the United States or any other country, all registrations and
recordings thereof and all applications for letters patent of the United States or any other
country, including, without limitation, registrations, recordings and applications in the United
States Patent and Trademark Office or in any similar office or agency of the United States, any
State thereof or any other country; (b) all reissues, divisions, continuations, renewals,
continuations-in-part or extensions thereof; (c) all petty patents, divisionals and patents of
addition; (d) all patents to issue in any such applications; (e) income, royalties, damages, claims
and payments now and hereafter due and/or payable with respect to patents, including, without
limitation, damages, claims and recoveries for past, present or future infringement; and (f) rights
to sue for past, present and future infringements of any patent.

     “Payment Intangibles” means and includes any “payment intangible” as such term is defined in
Article 9 of the UCC, now or hereafter owned or acquired or received by Grantor or in which Grantor
now holds or hereafter acquires or receives any right or interest.

     “Proceeds” means and includes any “proceeds,” as such term is defined in Article 9 of the UCC,
now or hereafter owned or acquired or received by Grantor or in which Grantor now holds or
hereafter acquires or receives any right or interest

     “Secured Obligations” means the Obligations (as such term is defined in the Note Purchase
Agreement).

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     “Security Agreement” means this Security Agreement and all Schedules hereto, as the same may
from time to time be amended, modified, supplemented or restated.

     “Trademark License” means any agreement, whether in written or electronic form, in which
Grantor now holds or hereafter acquires any interest, granting any right in and to any Trademark or
Trademark registration (whether Grantor is the licensee or the licensor thereunder).

     “Trademarks” means any of the following in which Grantor now holds or hereafter acquires any
interest: (a) any trademarks, tradenames, corporate names, company names, business names, trade
styles, service marks, logos, other source or business identifiers, prints and labels on which any
of the foregoing have appeared or appear, designs and general intangibles of like nature, now
existing or hereafter adopted or acquired, all registrations and recordings thereof and any
applications in connection therewith, including, without limitation, registrations, recordings and
applications in the United States Patent and Trademark Office or in any similar office or agency of
the United States, any State thereof or any other country (collectively, the “Marks”); (b) any
reissues, extensions or renewals thereof; (c) the goodwill of the business symbolized by or
associated with the Marks; (d) income, royalties, damages, claims and payments now and hereafter
due and/or payable with respect to the Marks, including, without limitation, damages, claims and
recoveries for past, present or future infringement; and (e) rights to sue for past, present and
future infringements of the Marks.

     “UCC” means the Uniform Commercial Code as the same may from time to time be in effect in the
State of New York (and each reference in this Security Agreement to an Article thereof (denoted as
a Division of the UCC as adopted and in effect in the State of New York) shall refer to that
Article (or Division, as applicable) as from time to time in effect; provided, however, in the
event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or
priority of Secured Party’s security interest in any Collateral is governed by the Uniform
Commercial Code as in effect in a jurisdiction other than the State of New York, the term “UCC”
shall mean the Uniform Commercial Code (including the Articles thereof) as in effect at such time
in such other jurisdiction for purposes of the provisions hereof relating to such attachment,
perfection or priority and for purposes of definitions related to such provisions.

     2. Grant of Security Interest. As collateral security for the full, prompt,
complete and final payment and performance when due (whether at stated maturity, by acceleration or
otherwise) of all the Secured Obligations and in order to induce Secured Party to cause the Loans
to be made, Grantor hereby assigns, conveys, mortgages, pledges, hypothecates and transfers to
Secured Party, and hereby grants to Secured Party, a security interest in all of Grantor’s right,
title and interest in, to and under the following, whether now owned or hereafter acquired (all of
which being collectively referred to herein as the “Collateral”):

          (a) the AvalonRx® Technology;

          (b) All Intellectual Property of Grantor, including without limitation, in respect of the
AvalonRx® Technology, and General Intangibles related to all Intellectual Property of Grantor;

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          (c) All Contracts of Grantor in respect of the AvalonRx® Technology;

          (d) To the extent not otherwise included, all books and records of Grantor with respect to
each of the foregoing, all Proceeds of each of the foregoing and all accessions to, substitutions
and replacements for and rents, profits and products of each of the foregoing.

          Notwithstanding anything to the contrary set for in this Security Agreement, “Collateral”
shall not include any asset, now owned or hereafter acquired or arising, to the extent that the
creation or attachment of a security interest in such asset would require the consent of any third
party under a Contract to which the Grantor is a party in order for the Grantor to avoid a breach
of or default under the Contract if the requirement of consent under the Contract for the creation
or attachment of the security interest is enforceable under applicable law and such consent has not
be obtained, provided, however, that the “Collateral” shall include and the
security interests hereunder shall immediately attach to any Contract upon receipt of any required
consent or amendment to such Contract modifies such Contract to eliminate the requirement for any
required consent.

     3. Rights Of Secured Party.

          (a) Notwithstanding anything contained in this Security Agreement to the contrary, Grantor
expressly agrees that it shall remain liable under each of its Contracts and Licenses to observe
and perform all the conditions and obligations to be observed and performed by it thereunder and
that it shall perform all of its duties and obligations thereunder, all in accordance with and
pursuant to the terms and provisions of each such Contract and License. Secured Party shall not
have any obligation or liability under any such Contract or License by reason of or arising out of
this Security Agreement or the granting to Secured Party of a lien therein or the receipt by
Secured Party of any payment relating to any such Contract or License pursuant hereto, nor shall
Secured Party be required or obligated in any manner to perform or fulfill any of the obligations
of Grantor under or pursuant to any such Contract or License, or to make any payment, or to make
any inquiry as to the nature or the sufficiency of any payment received by it or the sufficiency of
any performance by any party under any such Contract or License, or to present or file any claim,
or to take any action to collect or enforce any performance or the payment of any amounts which may
have been assigned to it or to which it may be entitled at any time or times.

          (b) Secured Party may at any time, upon the occurrence and during the continuance of any Event
of Default, without notifying Grantor of its intention to do so, notify parties to the Contracts of
Grantor which constitute Collateral that the right, title and interest of Grantor in and under such
Contracts have been assigned to Secured Party and that payments shall be made directly to Secured
Party. Upon the occurrence and during the continuance of any Event of Default, upon the request of
Secured Party, Grantor shall so notify such parties to such Contracts. Upon the occurrence and
during the continuance of any Event of Default, Secured Party may, in its name or in the name of
others, communicate with such parties to such Contracts to verify with such parties, to Secured
Party’s satisfaction, the existence, amount and terms of any such Contracts.

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     4. Representations And Warranties. Grantor hereby represents and warrants to Secured
Party that:

          (a) Except for the security interest granted to Secured Party under this Security Agreement,
Grantor is the sole legal and equitable owner of each item of the Collateral in which it purports
to grant a security interest hereunder, having good and marketable title thereto, free and clear of
any and all Liens.

          (b) No effective security agreement, financing statement, equivalent security or lien
instrument or continuation statement covering all or any part of the Collateral exists, except such
as may have been filed by Grantor in favor of Secured Party pursuant to this Security Agreement.

          (c) This Security Agreement creates a legal and valid security interest on and in all of the
Collateral in which Grantor now has rights and will create a legal and valid security interest in
the Collateral in which Grantor later acquires rights.

          (d) Grantor’s taxpayer identification number is set forth in the signature page hereof. If
Grantor is a corporation, limited liability company, limited partnership, corporate trust or other
registered organization, the State (or if not a state, the other jurisdiction) under whose law such
registered organization was organized is set forth on the signature page hereof. Grantor’s chief
executive office, principal place of business, and the place where Grantor maintains its records
concerning the Collateral are presently located at the address set forth on the signature page
hereof.

          (e) All Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks and Trademark
Licenses comprising the Collateral now owned, held or in which Grantor otherwise has any interest
are listed on Schedule A attached hereto. Grantor shall amend Schedule A from time to time in
accordance with Section 5.8 below to reflect any additions to or deletions from this list. Except
as set forth on Schedule A, none of the Patents, Trademarks or Copyrights have been licensed to any
third party.

     5. Covenants. Grantor covenants and agrees with Secured Party that from and after
the date of this Security Agreement and until the Secured Obligations have been performed and paid
in full and any commitment of Secured Party to make Loans to Grantor has expired or terminated:

          5.1 Disposition of Collateral. Grantor shall not sell, lease, transfer or otherwise dispose
of any of the Collateral, or attempt or contract to do so.

          5.2 Change of Jurisdiction of Organization, Relocation of Business or Collateral. Grantor
shall not change its jurisdiction of organization, relocate its chief executive office, principal
place of business or its records, or allow the relocation of any Collateral from such address(es)
provided to Secured Party pursuant to Section 4(d) above without fifteen (15) days prior written
notice to Secured Party.

          5.3 Limitation on Liens on Collateral. Grantor shall not, directly or indirectly, create,
permit or suffer to exist, and shall defend the Collateral against and take such

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other action as is necessary to remove, any Lien on the Collateral, except the Lien granted to
Secured Party under this Security Agreement. Grantor shall further defend the right, title and
interest of Secured Party in and to any of Grantor’s rights under the Collateral against the claims
and demands of all persons whomsoever.

          5.4 [Reserved].

          5.5 Taxes, Assessments, Etc. Grantor shall pay promptly when due all property and other
taxes, assessments and government charges or levies imposed upon Grantor, except to the extent the
validity thereof is being contested in good faith and adequate reserves are being maintained in
connection therewith.

          5.6 Maintenance of Records. Grantor shall keep and maintain at its own cost and expense
satisfactory and complete records of the Collateral.

          5.7 Registration of Intellectual Property Rights. Subject to Grantor’s reasonable business
judgment, (i) Grantor shall promptly register or cause to be registered (to the extent not already
registered) the most recent version of any Copyright, Copyright License, Patent, Patent License,
Trademark or Trademark License constituting the Collateral, with the United States Copyright Office
or Patent and Trademark Office, as applicable, including, without limitation, in all such cases the
filing of applications for renewal, affidavits of use, affidavits of noncontestability and
opposition and interference and cancellation proceedings and (ii) Grantor shall register or cause
to be registered with the United States Copyright Office or Patent and Trademark Office, as
applicable, those additional rights and interests developed or acquired by Grantor in respect of
the AvalonRx® Technology after the date of this Security Agreement, including, without limitation,
any additions to the rights and interests of Grantor listed on Schedule A hereto.

          5.8 Notification Regarding Changes in Intellectual Property. Grantor shall:

          (a) promptly advise Secured Party in writing of any subsequent ownership right or interest of
the Grantor in or to any Copyright, Patent, Trademark or License constituting Collateral not
specified on Schedule A hereto, and shall amend or permit Secured Party to amend such Schedule, as
necessary, to reflect any addition or deletion to such ownership rights;

          (b) promptly give Secured Party written notice of any applications or registrations of
intellectual property rights filed with the United States Patent and Trademark Office, including
the date of such filing and the registration or application numbers, if any; and

          (c) (i) give Secured Party not less than 30 days prior written notice of the filing of any
applications or registrations in respect of the Collateral with the United States Copyright Office,
including the title of such intellectual property rights to be registered, as such title will
appear on such applications or registrations, and the date such applications or registrations will
be filed, and (ii) prior to the filing of any such applications or registrations, shall execute
such documents as Secured Party may reasonably request for Secured Party to maintain its perfection
and priority in such intellectual property rights to be registered by Grantor, and upon the request
of Secured Party, shall file such documents simultaneously with the filing of any such

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applications or registrations. Upon filing any such applications or registrations with the
United States Copyright Office, Grantor shall promptly provide Secured Party with (x) a copy of
such applications or registrations, without the exhibits, if any, thereto, (y) evidence of the
filing of any documents requested by Secured Party to be filed for Secured Party to maintain the
perfection and priority of its security interest in such intellectual property rights, and (z) the
date of such filing.

          (d) Secured Party may audit the Collateral, at reasonable times and upon reasonable notice, to
confirm compliance with Section 5.7 and this Section 5.8. Secured Party shall have the right, but
not the obligation, to take, at Grantor’s sole expense, any actions that Grantor is required under
this Section 5.8 to take but which Grantor fails to take, after five (5) days’ notice to Grantor
(provided that no such notice shall be required if an Event of Default has occurred and is
continuing). Grantor shall reimburse and indemnify Secured Party for all reasonable costs and
reasonable expenses incurred in the reasonable exercise of its rights under Section 5.7 or this
Section 5.8.

          5.9 Defense of Intellectual Property. Grantor shall (a) protect, defend and maintain the
validity and enforceability of its Copyrights, Patents and Trademarks, (b) use its commercially
reasonable efforts to detect infringements of its Copyrights, Patents and Trademarks and promptly
advise Secured Party in writing of material infringements detected and (c) not allow any of its
Copyrights, Patents or Trademarks to be abandoned, forfeited or dedicated to the public without the
prior written consent of Secured Party.

          5.10 Further Assurances. At any time and from time to time, upon the written request of
Secured Party, and at the sole expense of Grantor, Grantor shall promptly and duly execute and
deliver any and all such further instruments and documents and take such further action as Secured
Party may reasonably deem necessary or desirable to obtain the full benefits of this Security
Agreement, including, without limitation, (a) using commercially reasonable efforts to secure all
consents and approvals necessary or appropriate for the grant of a security interest to Secured
Party in any item of Collateral held by Grantor or in which Grantor has any right or interest, (b)
executing, delivering and causing to be filed any financing or continuation statements (including
“in lieu” continuation statements) under the UCC with respect to the security interests granted
hereby, (c) filing or cooperating with Secured Party in filing any forms or other documents
required to be recorded with the United States Patent and Trademark Office, United States Copyright
Office, or any actions, filings, recordings or registrations in any foreign jurisdiction or under
any international treaty, required to secure or protect Secured Party’s interest in the Collateral,
(d) transferring the Collateral to Secured Party’s possession (if a security interest in such
Collateral can be perfected only by possession), and (e) at Secured Party’s reasonable request,
executing and delivering or causing to be delivered written notice to insurers of Secured Party’s
security interest in, or claim in or under, any policy of insurance (including unearned premiums).
Any such financing statements, continuation statements or amendments may be signed by Secured Party
on behalf of Grantor and may be filed at any time in any jurisdiction. Grantor hereby authorizes
Secured Party to file any financing or continuation statement (including “in lieu” continuation
statements) without the signature of Grantor.

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     6. Secured Party’s Appointment as Attorney-in-Fact; Performance by Secured Party.

          (a) Subject to Section 6(b) below, Grantor hereby irrevocably constitutes and appoints Secured
Party, and any officer or agent of Secured Party, with full power of substitution, as its true and
lawful attorney-in-fact with full, irrevocable power and authority in the place and stead of
Grantor and in the name of Grantor or in its own name, from time to time at Secured Party’s
discretion, for the purpose of carrying out the terms of this Security Agreement, to take any and
all appropriate action and to execute and deliver any and all documents and instruments which may
be necessary or desirable to accomplish the purposes of this Security Agreement and, without
limiting the generality of the foregoing, hereby gives Secured Party the power and right, on behalf
of Grantor, without notice to or assent by Grantor to do the following:

               (i) to ask, demand, collect, receive and give acquittances and receipts for any and all monies
due or to become due under any Collateral and, in the name of Grantor, in its own name or otherwise
to take possession of, endorse and collect any checks, drafts, notes, acceptances or other
instruments for the payment of monies due under any Collateral and to file any claim or take or
commence any other action or proceeding in any court of law or equity or otherwise deemed
appropriate by Secured Party for the purpose of collecting any and all such monies due under any
Collateral whenever payable;

               (ii) to pay or discharge any Liens, including, without limitation, any tax lien, levied or
placed on or threatened against the Collateral, to effect any repairs or any insurance called for
by the terms of this Security Agreement and to pay all or any part of the premiums therefor and the
costs thereof, which actions shall be for the benefit of Secured Party and not Grantor;

               (iii) to (1) direct any person liable for any payment under or in respect of any of the
Collateral to make payment of any and all monies due or to become due thereunder directly to
Secured Party or as Secured Party shall direct, (2) receive payment of any and all monies, claims
and other amounts due or to become due at any time arising out of or in respect of any Collateral,
(3) sign and endorse any invoices, freight or express bills, bills of lading, storage or warehouse
receipts, drafts against debtors, assignments, verifications and notices in connection with any
Collateral, (4) commence and prosecute any suits, actions or proceedings at law or in equity in any
court of competent jurisdiction to collect the Collateral or any part thereof and to enforce any
other right in respect of any Collateral, (5) defend any suit, action or proceeding brought against
Grantor with respect to any Collateral, (6) settle, compromise or adjust any suit, action or
proceeding described above, and in connection therewith, give such discharges or releases as
Secured Party may deem appropriate, (7) license, or, to the extent permitted by an applicable
License, sublicense, whether general, special or otherwise, and whether on an exclusive or
non-exclusive basis, any Copyright, Patent or Trademark throughout the world for such term or
terms, on such conditions and in such manner as Secured Party shall in its discretion determine and
(8) sell, transfer, pledge, make any agreement with respect to or otherwise deal with any of the
Collateral as fully and completely as though Secured Party were the absolute owner thereof for all
purposes; and

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               (iv) to do, at Secured Party’s option and Grantor’s expense, at any time, or from time to
time, all acts and things which Secured Party may reasonably deem necessary to protect, preserve or
realize upon the Collateral and Secured Party’s security interest therein in order to effect the
intent of this Security Agreement, all as fully and effectively as Grantor might do.

          (b) Secured Party agrees that, except upon the occurrence and during the continuation of an
Event of Default, it shall not exercise the power of attorney or any rights granted to Secured
Party pursuant to this Section 6. Grantor hereby ratifies, to the extent permitted by law, all
that said attorney shall lawfully do or cause to be done by virtue hereof. The power of attorney
granted pursuant to this Section 6 is a power coupled with an interest and shall be irrevocable
until the Secured Obligations are completely and indefeasibly paid and performed in full and
Secured Party no longer has any commitment to make any Loans to Grantor.

          (c) If Grantor fails to perform or comply with any of its agreements contained herein and
Secured Party, as provided for by the terms of this Security Agreement, shall perform or comply, or
otherwise cause performance or compliance, with such agreement, the reasonable expenses, including
reasonable attorneys’ fees and costs, of Secured Party incurred in connection with such performance
or compliance, together with interest thereon at a rate of interest equal to the highest per annum
rate of interest charged on the Loans, shall be payable by Grantor to Secured Party within five (5)
business days of demand and shall constitute Secured Obligations secured hereby.

     7. Rights And Remedies Upon Default. After any Event of Default shall have occurred
and while such Event of Default is continuing:

          (a) Secured Party may exercise in addition to all other rights and remedies granted to it
under this Security Agreement, the Notes or any other agreement between Grantor and Secured Lender,
and under any other instrument or agreement securing, evidencing or relating to the Secured
Obligations, all rights and remedies of a secured party under the UCC. Without limiting the
generality of the foregoing, Grantor expressly agrees that in any such event Secured Party, without
demand of performance or other demand, advertisement or notice of any kind (except the notice
specified below of time and place of public or private sale) to or upon Grantor or any other
person (all and each of which demands, advertisements and notices are hereby expressly waived to
the maximum extent permitted by the UCC and other applicable law), may (i) reclaim, take
possession, recover, store, maintain, finish, repair, prepare for sale or lease, shop, advertise
for sale or lease and sell or lease (in the manner provided herein) the Collateral, and in
connection with the liquidation of the Collateral and collection of the accounts receivable pledged
as Collateral, use any Trademark, Copyright, or process used or owned by Grantor and (ii)
forthwith collect, receive, appropriate and realize upon the Collateral, or any part thereof, and
may forthwith sell, lease, assign, give an option or options to purchase or sell or otherwise
dispose of and deliver said Collateral (or contract to do so), or any part thereof, in one or more
parcels at public or private sale or sales, at any exchange or broker’s board or at any of Secured
Party’s offices or elsewhere at such prices as it may deem best, for cash or on credit or for
future delivery without assumption of any credit risk. To the extent Grantor has the right to do
so, Grantor authorizes Secured Party, on the terms set forth in this Section 7 to enter the

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premises where the Collateral is located, to take possession of the Collateral, or any part of
it, and to pay, purchase, contact, or compromise any encumbrance, charge, or lien which, in the
opinion of Secured Party, appears to be prior or superior to its security interest. Secured Party
shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon
any such private sale or sales, to purchase the whole or any part of said Collateral so sold, free
of any right or equity of redemption, which equity of redemption Grantor hereby releases. Grantor
further agrees, at Secured Party’s request, to assemble the Collateral and make it available to the
Secured Party at places which Secured Party shall reasonably select, whether at Grantor’s premises
or elsewhere. Secured Party shall apply the net proceeds of any such collection, recovery,
receipt, appropriation, realization or sale as provided in this Section 7, and only after so paying
over such net proceeds and after the payment by Secured Party of any other amount required by any
provision of law, need Secured Party account for the surplus, if any, to Grantor. To the maximum
extent permitted by applicable law, Grantor waives all claims, damages, and demands against Secured
Party arising out of the repossession, retention or sale of the Collateral. Grantor agrees that
Secured Party need not give more than ten (10) days’ notice of the time and place of any public
sale or of the time after which a private sale may take place and that such notice is reasonable
notification of such matters. Grantor shall remain liable for any deficiency if the proceeds of any
sale or disposition of the Collateral are insufficient to pay all amounts to which Secured Party is
entitled from Grantor, Grantor also being liable for the attorney costs of any attorneys employed
by Secured Party to collect such deficiency.

          (b) Grantor agrees that in any sale of any of such Collateral, whether at a foreclosure sale
or otherwise, Secured Party is hereby authorized to comply with any limitation or restriction in
connection with such sale as it may be advised by counsel is necessary in order to avoid any
violation of applicable law (including compliance with such procedures as may restrict the number
of prospective bidders and purchasers, require that such prospective bidders and purchasers have
certain qualifications and restrict such prospective bidders and purchasers to persons who will
represent and agree that they are purchasing for their own account for investment and not with a
view to the distribution or resale of such Collateral), or in order to obtain any required approval
of the sale or of the purchaser by any governmental authority, and Grantor further agrees that such
compliance shall not result in such sale being considered or deemed not to have been made in a
commercially reasonable manner, nor shall Secured Party be liable nor accountable to Grantor for
any discount allowed by the reason of the fact that such Collateral is sold in compliance with any
such limitation or restriction.

          (c) Grantor also agrees to pay all fees, costs and expenses of Secured Party, including,
without limitation, attorneys’ fees, incurred in connection with the enforcement of any of its
rights and remedies hereunder.

          (d) Grantor hereby waives presentment, demand, protest or any notice (to the maximum extent
permitted by applicable law) of any kind in connection with this Security Agreement or any
Collateral.

          (e) The Proceeds of any sale, disposition or other realization upon all or any part of the
Collateral shall be distributed by Secured Party in the following order of priorities:

11.

 

          First, to Secured Party in an amount sufficient to pay in full the costs of Secured
Party in connection with such sale, disposition or other realization, including all fees, costs,
expenses, liabilities and advances incurred or made by Secured Party in connection therewith,
including, without limitation, attorneys’ fees;

          Second, to Secured Party in an amount equal to the then unpaid Secured Obligations;
and

          Finally, upon payment in full of the Secured Obligations, to Grantor or its
representatives, in accordance with the UCC or as a court of competent jurisdiction may direct.

     8. Indemnity. Grantor agrees to defend, indemnify and hold harmless Secured Party
and its officers, employees, and agents against (a) all obligations, demands, claims, and
liabilities claimed or asserted by any other party in connection with the transactions contemplated
by this Security Agreement and (b) all losses or expenses in any way suffered, incurred, or paid by
Secured Party as a result of or in any way arising out of, following or consequential to
transactions between Secured Party and Grantor, whether under this Security Agreement or otherwise
(including without limitation, reasonable attorneys fees and expenses), except for losses arising
from or out of Secured Party’s (or any Secured Party’s officer’s, employee’s or agent’s) gross
negligence or willful misconduct.

     9. Limitation on Secured Party’s Duty in Respect of Collateral. Secured Party shall
be deemed to have acted reasonably in the custody, preservation and disposition of any of the
Collateral if it takes such action as Grantor requests in writing except during an Event of
Default, but failure of Secured Party to comply with any such request shall not in itself be deemed
a failure to act reasonably, and no failure of Secured Party to do any act not so requested shall
be deemed a failure to act reasonably.

     10. Reinstatement. This Security Agreement shall remain in full force and effect and
continue to be effective should any petition be filed by or against Grantor for liquidation or
reorganization, should Grantor become insolvent or make an assignment for the benefit of creditors
or should a receiver or trustee be appointed for all or any significant part of Grantor’s property
and assets, and shall continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Secured Obligations, or any part thereof, is, pursuant to applicable
law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee of
the Secured Obligations, whether as a “voidable preference,” “fraudulent conveyance,” or otherwise,
all as though such payment or performance had not been made. In the event that any payment, or any
part thereof, is rescinded, reduced, restored or returned, the Secured Obligations shall be
reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or
returned.

     11. Miscellaneous.

          11.1 Waivers; Modifications. None of the terms or provisions of this Security Agreement may
be waived, altered, modified or amended except by an instrument in writing, duly executed by
Grantor and Secured Party.

12.

 

          11.2 Termination of this Security Agreement. Subject to Section 10 hereof, this Security
Agreement shall terminate upon the payment and performance in full of the Secured Obligations
(other than contingent indemnification or reimbursement Obligations other than those related to
claims, causes of action, or liabilities that have been asserted or threatened).

          11.3 Successor and Assigns. This Security Agreement and all obligations of Grantor hereunder
shall be binding upon the successors and assigns of Grantor, and shall, together with the rights
and remedies of Secured Party hereunder, inure to the benefit of Secured Party, any future holder
of any of the Secured Obligations and their respective successors and assigns. No sales of
participations, other sales, assignments, transfers or other dispositions of any agreement
governing or instrument evidencing the Secured Obligations or any portion thereof or interest
therein shall in any manner affect the lien granted to Secured Party hereunder.

          11.4 Governing Law. In all respects, including all matters of construction, validity and
performance, this Security Agreement shall be governed by, and construed and enforced in accordance
with, the laws of the State of New York applicable to contracts made and performed in such state,
without regard to the principles thereof regarding conflict of laws, except to the extent that the
UCC provides for the application of the law of a different jurisdiction.

          11.5 Waiver of Jury Trial. GRANTOR AND SECURED PARTY EACH WAIVE THEIR RIGHT TO A JURY TRIAL
OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS SECURITY AGREEMENT, INCLUDING
CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FOR BOTH
PARTIES TO ENTER INTO THIS SECURITY AGREEMENT. EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS
COUNSEL.

[Signature pages follow.]

13.

 

     In Witness Whereof, each of the parties hereto has caused this Intellectual Property
Security Agreement to be executed and delivered by its duly authorized officer on the date first
set forth above.

	 	 	 	 	 
	
Address Of Grantor
 	

Avalon Pharmaceuticals, Inc., as Grantor

 	 
	20358 Seneca Meadows Parkway

Germantown, MD 20876 	By:  	/s/ Kenneth C. Carter
 	 
	 	 	Printed Name:
Kenneth C. Carter 	 
	 	 	Title: 	President and Chief Executive Officer 	 
	 

	 	 	 	 	 
	Taxpayer Identification Number of Grantor

 	 	Jurisdiction of Organization of Grantor 
	52-2209310

 	 	Delaware
 
	Accepted And Acknowledged By:

 	 	 
	Clinical Data, Inc., as Secured Party

 	 	 
	By:  	/s/ Caesar J. Belbel
 	 	 
	 	Printed Name:
Caesar J. Belbel 	 	 
	 	Title: 	Executive Vice President, Chief Legal
Officer and Secretary 	 	 
	 

14.exv10w22

Exhibit 10.22

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This
Amended and Restated Employment Agreement, dated as of October 30, 2008 (the “Agreement”) is
made by and between USA Mobility, Inc., a Delaware corporation (the “Company”) and Vincent D. Kelly
(the “Executive”).

WHEREAS, the Company and Executive are parties to that certain Employment Agreement dated November
16, 2004, and amended as of October 30, 2007, pursuant to which the Executive has been employed as
the Chief Executive Officer and President of the Company (the “Original Employment Agreement”); and

WHEREAS, the Company and the Executive desire to amend and restate in full the Executive’s Original
Employment Agreement with the Company and, in order to do so, enter into this Agreement.

NOW, THEREFORE, in consideration of the foregoing and the covenants and agreements set forth in
this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:

	1.	 	Employment. The Company shall employ the Executive as the Chief Executive Officer and
President of the Company based upon the terms and conditions set forth in this Agreement, for
the period of time specified in Section 3. In such positions, the Executive shall report
directly and exclusively to the Board of Directors of the Company (the “Board”).
	 
	2.	 	Duties and Authority. During the term of this Agreement, as the Chief Executive
Officer and President of the Company, under the direction and subject to the control of the
Board (which direction shall be such as is customarily exercised over a chief executive
officer of a public company), the Executive shall be responsible for the business, affairs,
properties and operations of the Company, and shall have general executive charge, management
and control of the Company, with all such powers and authority with respect to such business,
affairs, properties, and operations as may be reasonably incident to such duties and
responsibilities, and shall perform such other duties for the Company as the Board may
determine from time to time. The Executive shall devote the Executive’s reasonable best
efforts and full business time, energies and talents to the performance of the Executive’s
duties and the advancement of the business and affairs of the Company.
	 
	3.	 	Term. The term of this Agreement and the period of employment of the Executive by the
Company hereunder (the “Agreement Term”) shall commence on November 16, 2008 (the “Effective
Date”) and shall end on December 31, 2012 (the “Expiration Date”), unless earlier terminated
pursuant to Section 7 herein. Provided that the Executive remains employed by the Company, as
of the Expiration Date the Executive (i) shall become an employee “at will,” and (ii) provided
he remains employed with the Company after the Expiration Date as its Chief Executive Officer
and President or a person reporting directly to such officer, shall be entitled on a most
favored nations basis to any and all such benefits and other perquisites as are then available
to any person(s) then reporting directly to the Chief Executive Officer, including any change
of control plans, agreements or programs as well as any severance plans,

 

 

	 	 	agreements or programs, on terms and
conditions as to each such perquisite and/or benefit no less favorable to the Executive than
those used for the applicable person.

	4.	 	Compensation and Expenses.
	 
	(a)	 	Base Salary. In consideration for the Executive’s services and subject to the terms
and conditions of this Agreement, the Company shall pay to the Executive an annual base salary
(the “Base Salary”) equal to Six Hundred Thousand Dollars ($600,000), commencing as of the
Effective Date. The Base Salary shall be payable biweekly or in such other installments as
shall be consistent with the Company’s payroll procedures. The Company shall deduct and
withhold all necessary social security and withholding taxes and any other similar sums
required by law or authorized by the Executive with respect to the payment of the Base Salary.
The Board shall review the Base Salary annually before December 31 and may, in its discretion,
increase, but not decrease, his Base Salary in any renewal, extension or replacement of this
Agreement. The Board shall also review the appropriateness of creating additional forms of
nonqualified executive compensation to cover the Executive.
	 
	(b)	 	Annual Bonus. The Executive shall be eligible for a target annual bonus equal to 200%
of Base Salary based on achievement of certain bonus targets set by the Board or a committee
thereof (the “Annual Bonus”); provided that the Executive is employed by the Company on
December 31 of the applicable calendar year and Executive has not voluntarily terminated his
employment in the Company pursuant to Section 8(d) herein prior to the date such Annual Bonus
is payable hereunder. Each Annual Bonus shall be paid upon completion of the annual audit of
the Company’s financial statements for the applicable annual year or sooner if the
Compensation Committee (“Compensation Committee”) of the Company’s Board of Directors so
agrees, but in any event no later than March 15 of the next following year. The Annual Bonus
for calendar year 2008 shall be payable in cash. Further, provided that the Company’s stock
is publicly traded on a national securities exchange on the date an Annual Bonus is actually
paid, such Annual Bonus for calendar years 2009 through 2012 shall be payable one-half in cash
and one-half in unrestricted stock of USA Mobility, unless the Compensation Committee and the
Executive mutually agree otherwise. The criteria for determining the amount of any Annual
Bonus and the bases upon which such Annual Bonus shall be payable shall be no less favorable
to the Executive than those used for other senior executives of the Company, such criteria and
bases to be determined in the sole discretion of the Board (or Compensation Committee, as
applicable).
	 
	(c)	 	Benefits. To the maximum extent permitted by applicable state and federal law, the
Executive shall be eligible, at no cost to the Executive, to participate in all of the
Company’s benefit plans, including fringe benefits available to the Company’s senior
executives, as such plans or programs are in effect from time to time, and use of an
automobile. Further, simultaneously with its execution of this Agreement, the Company shall
execute and deliver to the Executive for counter-signature the Indemnification Agreement
attached hereto as Exhibit A.

2

 

	(d)	 	Holidays and Vacation. The Executive shall be entitled to (i) time off for all public
holidays observed by the Company and (ii) vacation days in accordance with the applicable
policies for the Company’s senior executives as in effect from time to time.
	 
	(e)	 	Reimbursement of Expenses. The Company shall reimburse the Executive for all
reasonable expenses the Executive incurs in accordance with the reasonable policies and
procedures adopted from time to time by the Company.
	 
	5.	 	Confidential Information.
	 
	(a)	 	“Confidential Information” means any and all Company and Company subsidiary proprietary
information, technical data, patent applications, inventions or discoveries (whether
patentable or not), know-how and trade secrets, as well as operating, design and manufacturing
procedures disclosed to the Executive, including before the date of this Agreement.
“Confidential Information” further means, without limitation, research, product development
activities, processes, products, specifications, designs, diagrams, illustrations, programs,
concepts, ideas, marketing plans, proposals, financial information, confidential reports,
communications and customer lists and data, as well as the nature and results of the Company’s
and its subsidiaries’ research and development activities, and all other materials and
information related to the business or activities of the Company and its subsidiaries that are
not generally known to the public; provided, however, that the term “Confidential Information”
excludes information that (i) is or becomes generally available to the public other than
through acts by the Executive in violation of this Agreement, (ii) was legally within the
Executive’s possession prior to disclosure to the Executive by or on behalf of the Company or
its predecessor, which prior possession can be evidenced by the Executive’s written records in
existence prior to the effective date of any Prior Employment Document (as defined in Section
10 below), or (iii) becomes available to the Executive on a non-confidential basis from a
source other than the Company or a subsidiary or predecessor of the Company, provided that
such source is not bound by a confidentiality agreement with the Company or any of its
subsidiaries, or by any other contractual, legal or fiduciary obligation of confidentiality to
the Company or any of its subsidiaries, or any other party with respect to such information.
	 
	(b)	 	Except as may be required by the lawful order of a court or agency of competent jurisdiction,
the Executive covenants and agrees that, during the Agreement Term and at all times
thereafter, the Executive will keep secret and confidential all Confidential Information, and
will not at any time, without the prior written consent of the Board or a person authorized by
the Board, publish or disclose any Confidential Information, either directly or indirectly, to
any third party, use for the Executive’s own benefit or advantage, or make available for
others to use (except to third parties in connection with possible transactions or business
with the Company).
	 
	(c)	 	To the extent that any court or agency seeks to have the Executive disclose Confidential
Information, the Executive shall promptly inform the Company, and shall take all reasonable
steps necessary to prevent disclosure of any Confidential Information until the Company has
been informed of such requested disclosure, and the Company has an 

3

 

	 	 	opportunity to respond to such court or agency. To the extent that the Executive obtains
information on behalf of the Company or any of its subsidiaries that may be subject to
attorney-client privilege as to the Company’s attorneys, the Executive shall take reasonable
steps necessary to maintain the confidentiality of such information and to preserve such
privilege.
	 
	(d)	 	The Executive acknowledges that the restrictions contained in Section 5(b) and 5(c) are
reasonable and necessary, in view of the nature of the Company’s business, in order to protect
the legitimate interests of the Company, and that any violation thereof would result in
irreparable injury to the Company. Therefore, the Executive agrees that in the event of a
breach or threatened breach by the Executive of the provisions of Section 5(b) and (c), the
Company shall be entitled to obtain from any court of competent jurisdiction, preliminary or
permanent injunctive relief restraining the Executive from disclosing or using any such
Confidential Information. The Executive also acknowledges that nothing in this Section 5 shall
be construed as limiting the Executive’s duty of loyalty to the Company, or any other duty he
may otherwise have to the Company, while he is employed by the Company.
	 
	6.	 	Covenant Not to Compete. The Executive agrees that, through his position as Chief
Executive Officer and President of the Company and the various other positions with the
Company that he has held from time to time, the Executive has established and will continue to
establish valuable and recognized expertise in the paging business and has had and will have
access to the Company’s Confidential Information. The Executive hereby enters into a covenant
restricting the Executive from soliciting employees of the Company and its subsidiaries and
from competing against the Company upon the terms and conditions described below:
	 
	(a)	 	During the Executive’s employment and for a period of two (2) years after the Date of
Termination (as defined in Section 7(d) below) for any reason, the Executive shall not:

	 	(i)	 	induce or attempt to induce any person who, as of the Date of the Termination,
is an employee of the Company or of any of its subsidiaries to terminate his or her
employment, or refrain from renewing or extending such employment, with the Company or
such subsidiary in order to become an director, officer, employee, consultant or
independent contractor to or for any other individual or entity other than the Company
or its subsidiaries;
	 
	 	(ii)	 	in any state or other jurisdiction in the United States in which, as of the
Date of Termination, the Company is engaged in Business (as defined herein) or has
developed plans to engage in Business: (1) engage or be a part of any Person (including
as a director, consultant, employee, agent, or representative), or have any direct or
indirect financial interest (whether as a partner, shareholder, or owner (other than
ownership of 1% or less of the outstanding stock of any corporation listed on a
national stock exchange)) in any Person that engages in the business of owning and
operating narrowband one-way paging and wireless messaging networks, voice mail
services or data transmitting services (the

4

 

	 	 	 	“Business”); or (2) participate as an employee or officer in any enterprise in which
the Executive’s responsibility relates to the Business;
	 
	 	(iii)	 	directly or indirectly own an equity interest in any Competitor (other than
ownership of 1% or less of the outstanding stock of any corporation listed on a
national stock exchange). The term “Competitor” means any Person a portion of the
business of which (and during any period in which it intends to enter into business
activities that would be) is materially competitive in any way with the Business of the
Company; or
	 
	 	(iv)	 	solicit or cause or encourage any person to solicit any Business in competition
with the Company or a subsidiary from any Person who as of the Date of Termination is,
or at any time during the 1-year period prior to the Date of Termination was, a client
of the Company or of a subsidiary during the Executive’s employment hereunder.

	(b)	 	The Executive agrees that the restrictions set forth in this Section 6 are reasonable,
proper, and necessitated by legitimate business interests of the Company and do not constitute
an unlawful or unreasonable restraint upon the Executive’ ability to earn a livelihood. The
parties agree that in the event any of the restrictions in this Agreement, interpreted in
accordance with the Agreement as a whole, are found to be unreasonable a court of competent
jurisdiction, such court shall determine the limits allowable by law and shall enforce the
same. The parties further agree that nothing in this Section 6 shall be construed as limiting
the Executive’s duty of loyalty to the Company, or any other duty he may otherwise have to the
Company, while he is employed by the Company.
	 
	(c)	 	The Executive further acknowledges that it may be impossible to assess the monetary damages
incurred by the Executive’s violation of this Agreement, and that violation of this Agreement
will cause irreparable injury to the Company. Accordingly, the Executive agrees that the
Company will be entitled, in addition to all other rights and remedies that may be available,
to an injunction enjoining and restraining the Executive and any other involved party from
committing a violation of this Agreement.

	7.	 	Termination. Notwithstanding any other provision of this Agreement, this Agreement
(and, thereby, the Executive’s employment with the Company) shall terminate upon the death of
the Executive, or it may be terminated with thirty (30) days’ written notice as follows:

	(a)	 	The Company may terminate this Agreement (and, thereby, the Executive’s employment with the
Company):

	 	(i)	 	at any time if the Executive is Disabled (as defined below) for a period of six
(6) months or more;
	 
	 	(ii)	 	at any time with “Cause.” For purposes of this Agreement. “Cause” means (A)
dishonesty of a material nature that relates to the performance of services under this
Agreement; (B) criminal conduct (other than minor infractions and traffic violations)
that relates to the performance of services under this Agreement, (C)

5

 

	 	 	 	the Executive’s willfully breaching or failing to perform his duties as described in
Section 2 hereof (other than any such failure resulting from the Executive’s being
Disabled), within a reasonable period of time after a written demand for substantial
performance is delivered to the Executive by the Board, which demand specifically
identifies the manner in which the Board believes that the Executive has not
substantially performed his duties; or (D) the willful engaging by the Executive in
conduct that is demonstrably and materially injurious to the Company, monetarily or
otherwise. No act or failure to act on the Executive’s part shall be deemed
“willful” unless done, or omitted to be done, by the Executive not in good faith and
without reasonable belief that such action or omission was in the best interests of
the Company. Notwithstanding the foregoing, the Executive shall not be deemed to
have been terminated for Cause unless and until there shall have been delivered to
the Executive a resolution duly adopted by a majority of the members of the
Company’s Board of Directors with no less than the affirmative vote of all Directors
who are not also serving as officers or employees of the Company, at a meeting of
the Board called and held for such purpose (after reasonable notice to the Executive
and an opportunity for the Executive, together with the Executive’s counsel, to be
heard before the Board), finding that in the good faith judgment of the Board, the
Executive has engaged in the conduct set forth in this paragraph and specifying the
particulars thereof in detail; or
	 
	 	(iii)	 	at any time without Cause upon Notice from the Company to the Executive, which
Notice shall be effective immediately or such later time as is specified in such
Notice.

	(b)	 	The Executive may terminate this Agreement (and, thereby, his employment with the Company) at
any time upon sixty (60) days’ Notice to the Company.
	 
	(c)	 	This Agreement may be terminated (and, thereby, the Executive’s employment with the Company)
at any time by the mutual agreement of the parties. Any termination of the Executive’s
employment by mutual agreement of the parties shall be memorialized by a written agreement
signed by the Executive and duly-appointed officers of the Company.
	 
	(d)	 	Any purported termination of the Executive’s employment by the Company or by the Executive
shall be communicated by written Notice of Termination to the other party hereto in accordance
with Section 12. For purposes of this Agreement, a “Notice of Termination” shall mean a
notice that shall indicate the Date of Termination (which shall not be earlier than the date
on which such Notice is sent), and the specific provision of this Agreement relied upon and
that shall set forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive’s employment. The “Date of Termination” means the last
day the Executive is employed by the Company hereunder (including any successor to the Company
as determined in accordance with Section 15). If the Executive becomes employed by the entity
into which the Company is merged, or the purchaser of substantially all of the assets of the
Company, or a successor to such entity or purchaser, the Executive shall not be treated as
having terminated employment for purposes of this Agreement until such time as the

6

 

	 	 	Executive terminates employment with the successor (including, without limitation, the
merged entity or purchaser).
	 
	8.	 	Compensation Upon Termination.
	 
	(a)	 	Death. If the Executive’s employment is terminated by the Executive’s death, the
Company shall pay to the Executive’s estate, or as may be directed by the legal
representatives to such estate, (i) the Executive’s Base Salary in effect on the date
immediately prior to the Executive’s death, through the Executive’s date of death; (ii)
subject to the terms and conditions of the applicable Company fringe benefit or incentive
compensation plan or program, all other unpaid amounts, if any, to which the Executive is
entitled as of the date of the Executive’s death, under any Company fringe benefit or
incentive compensation plan or program, at the time such payments would otherwise ordinarily
be due (including, without limitation, any Annual Bonus to the extent unpaid in respect of the
calendar year ending prior to the date of the Executive’s death); (iii) the Executive’s full
Base Salary that would have been payable to the Executive from the Executive’s date of death
through the Expiration Date, in a lump sum within forty-five (45) days after his death; and
(iv) an amount equal to the product of the target Annual Bonus for the calendar year in which
the Executive died multiplied by a fraction the numerator being the number of days Executive
was employed by the Company in the calendar year of his death and the denominator being 365,
in a lump sum within forty-five (45) days after his death.
	 
	(b)	 	Disability. Following the use of all sick days to which the Executive is entitled
under the policies applicable to the Company’s senior executives, while he is Disabled until
the Date of Termination (the “Disability Period”), the Company shall, in lieu of payment of
his Base Salary, pay the Executive (i) a disability benefit equal to 50% of the Base Salary
that he would otherwise be entitled to receive for the Disability Period; (ii) subject to the
terms and conditions of the applicable Company fringe benefit or incentive compensation plan
or program, all other unpaid amounts, if any, to which the Executive is entitled as of the
Executive’s date of disability, under any Company fringe benefit or incentive compensation
plan or program, at the time such payments are due (including, without limitation, any Annual
Bonus to the extent unpaid in respect of the calendar year ending prior to the date of the
Executive’s disability); (iii) the Executive’s full Base Salary that would have been payable
to the Executive from the Executive’s Date of Termination through the Expiration Date, in a
lump sum within forty-five (45) days after such Date of Termination; and (iv) an amount equal
to the product of the target Annual Bonus for the calendar year in which the Executive became
Disabled multiplied by a fraction the numerator being the number of days in the calendar year
of his termination due to his becoming Disabled prior to the commencement of the Disability
Period, and the denominator being 365, in a lump sum within forty-five (45) days after such
Date of Termination; provided, however, that any payments made to the
Executive during the Disability Period shall be reduced by any amounts paid or payable to the
Executive under any Company disability benefit plans. Subject to the terms of this Agreement,
the Executive shall not be required to perform services under this Agreement during any period
that he is Disabled. The Executive shall be considered Disabled during any period in which he
has an illness, or a physical or mental disability, or similar incapacity, that

7

 

	 	 	renders him incapable, after reasonable accommodation, of performing his duties under this
Agreement. In the event of a dispute as to whether the Executive is Disabled, the Company
may refer the same to a licensed practicing physician of the Company’s choice, and the
Executive agrees to submit to such tests and examinations as such physician shall deem
appropriate. During the period in which the Executive is Disabled, the Company may appoint
a temporary replacement to assume the Executive’s responsibilities.
	 
	(c)	 	For Cause. If the Company terminates the Executive’s employment for Cause, the
Company shall pay (i) the Executive’s Base Salary in effect on the date immediately prior to
such termination, through the date specified in the Notice of Termination; and (ii) subject to
the terms and conditions of the applicable Company fringe benefit or incentive compensation
plan or program, all other unpaid amounts, if any, to which the Executive is entitled as of
the Date of Termination, under any Company fringe benefit or incentive compensation plan or
program, at the time such payments are due (including, without limitation and when due, any
Annual Bonus to the extent unpaid in respect of the calendar year ending prior to the Date of
Termination), and the Company shall have no further obligations to the Executive under this
Agreement.
	 
	(d)	 	Voluntary. If the Executive terminates his employment for other than Good Reason, the
Company shall pay (i) the Executive’s Base Salary in effect on the date immediately prior to
such termination, through the date specified in the Notice of Termination and (ii) subject to
the terms and conditions of the applicable Company fringe benefit or incentive compensation
plan or program, all other unpaid amounts, if any, to which the Executive is entitled as of
the Date of Termination, under any such fringe benefit or incentive compensation plan or
program, at the time such payments are due (excluding, for the avoidance of doubt, any Annual
Bonus to the extent unpaid in respect of the calendar year ending prior to the Date of
Termination.) The Company shall have no further obligations to the Executive under this
Agreement.
	 
	 	 	“Good Reason” means the occurrence, without the Executive’s express written consent, of any
of the following circumstances:

	 	(i)	 	the Company’s failure to perform or observe any of the material terms or
provisions of this Agreement after the Executive gives a written demand for performance
to the Company within thirty (30) days of the event or circumstance giving rise to such
failure of performance or observance, which demand shall describe specifically the
nature of such alleged failure to perform or observe such material terms or provisions;
	 
	 	(ii)	 	the assignment to the Executive of any duties inconsistent with, or any
substantial diminution in, such Executive’s status or responsibilities as in effect on
the date hereof, including imposition of travel obligations that are materially greater
than is reasonably required by the Company’s business;
	 
	 	(iii)	 	a reduction in the Executive’s Base Salary as in effect on the date hereof, as
that amount may be increased from time to time; or (II) the failure to pay a bonus
award to which the Executive is otherwise entitled, at the time such bonuses are
usually paid;

8

 

	 	(iv)	 	a change in the principal place of the Executive’s employment, as in effect on
the date hereof or as in effect after any subsequent change to which the Executive
consented in writing, to a location more than thirty-five (35) miles distant from the
location of such principal place;
	 
	 	(v)	 	the Company’s failure to continue in effect any incentive compensation plan or
stock option plan in which the Executive participates, unless the Company has provided
an equivalent alternative compensation arrangement (embodied in an ongoing substitute
or alternative plan) to the Executive, or (II) the Company’s failure to continue the
Executive’s participation in any such incentive or stock option plan on substantially
the same basis, both in terms of the amount of benefits provided and the level of the
Executive’s participation relative to other participants;
	 
	 	(vi)	 	the Company’s violation of any applicable criminal law not due to the
Executive’s gross negligence or willful misconduct;
	 
	 	(vii)	 	the failure of the Company or any successor to obtain a satisfactory written
agreement from any successor to assume and agree to perform this Agreement, as
contemplated in Section 15 below; or
	 
	 	(viii)	 	any purported termination of the Executive’s employment that is not effected pursuant
to a Notice of Termination satisfying the requirements of Sections 7(a)(ii) or 7(d), as
applicable. For purposes of this Agreement, no such purported termination shall be
effective except as constituting Good Reason.

The Executive’s continued employment shall not constitute consent to, or a waiver of rights with
respect to, any event or circumstance constituting Good Reason hereunder. The Executive must (1)
give the Company thirty (30) days to cure any event or circumstance giving rise to Good Reason
following his written demand for such cure, and (2) actually terminate his employment as a
consequence of such uncured event or circumstance within fifteen (15) days following the end of
such 30-day cure period.

	(e)	 	Other. If the Company terminates the Executive’s employment other than for Cause or
Disability or if the Executive terminates employment with the Company for Good Reason, the
Company shall pay the Executive’s Base Salary through the date specified in the Notice of
Termination within ten (10) business days after such date and all other unpaid amounts, if
any, to which the Executive is entitled as of the date specified in the Notice of Termination
under any Company fringe benefit or incentive compensation plan or program, at the time such
payments are due (including, without limitation and when due, any Annual Bonus to the extent
unpaid in respect of the calendar year ending prior to the Date of Termination). In addition,
the Company shall pay the Executive against receipt from the Executive a written, signed
release in the form of Exhibit B hereto:

	 	(i)	 	an amount equal to the product of (a) the greater of (x) two or (y) the number
of years (and fraction thereof) remaining in the Agreement Term as of the date
specified in the Notice of Termination, times (b) the full Base Salary then in

9

 

	 	 	 	effect within forty-five (45) days after such date specified in the Notice of
Termination;
	 
	 	(ii)	 	an amount equal to the target Annual Bonus for the calendar year in which the
Date of Termination occurs, in a lump sum within forty-five (45) days after such Date
of Termination.
	 
	 	(iii)	 	an amount equal to the product of the target Annual Bonus for the calendar
year in which the Date of Termination occurs multiplied by a fraction the numerator is
the number of days in that calendar year to and including the Date of Termination and
the denominator is 365, in a lump sum within forty-five (45) days after such Date of
Termination;
	 
	 	(iv)	 	reimbursement of the cost of continuation coverage of group health coverage
pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) for
the duration of the applicable period to the extent Executive elects such continuation
coverage and is eligible and subject to the terms of the plan and the law
(collectively, the “Reimbursement Payments”) together with an additional amount,
payable within ten (10) business days following the end of the applicable COBRA period,
such that the net amount retained by the Executive, after deduction of any Federal,
state and local income and employment taxes and Excise Tax upon the Reimbursement
Payments, shall be equal to the Reimbursement Payments;
	 
	 	(v)	 	reimbursement for expenses reasonably incurred by the Executive in securing
outplacement services through a professional person or entity of the Executive’s
choice, subject to the approval of the Company (which approval shall not be
unreasonably withheld, conditioned or delayed), at a level commensurate with the
Executive’s position, for a period of up to one (1) year commencing on or before the
one-year anniversary of the Date of Termination at the Executive’s election, provided
that the cost therefore to the Company shall not exceed thirty five thousand dollars
($35,000), but in no event extending beyond the earlier to occur of (i) the end of the
Executive’s second taxable year following the taxable year in which the Termination
Date occurs, and (ii) the date on which the Executive commences other full time
employment. The Company shall reimburse the Executive for any such permitted expenses
on or before the end of the Executive’s third taxable year following the taxable year
in which the Termination Date occurs; and
	 
	 	(vi)	 	full vesting of any equity compensation and the lapse of all restrictions with
respect to any restricted stock granted to the Executive.
	 
	 	(vii)	 	Gross-Up Payments.

	 	(1)	 	If any payment or the value of any benefit received or to be
received by the Executive in connection with the Executive’s termination or
contingent upon a Change of Control (as hereinafter defined) of the

10

 

	 	 	 	Company (whether received or to be received pursuant to the terms of this
Agreement (the “Agreement Payments”) or of any other plan, arrangement, or
agreement of the Company, its successors, any person whose actions result in
a Change of Control of the Company, or any person affiliated with any of
them (or which, as a result of the completion of the transactions causing a
Change of Control, will become affiliated with any of them (“Other Payments”
and, together with the Agreement Payments, the “Payments”)) would be subject
to the excise tax imposed by Section 4999 of the Internal Revenue Code of
1986, as amended (the “Tax Code”) or any comparable federal, state, or local
excise tax (such excise tax, together with any interest and penalties, are
hereinafter collectively referred to as the “Excise Tax”), as determined as
provided below, the Company shall pay to the Executive an additional amount
(the “Gross-Up Payment”) such that the net amount the Executive retains,
after deduction of the Excise Tax on Agreement Payments and Other Payments
and any federal, state, and local income, payroll and/or employment tax and
Excise Tax upon the payment provided for by Section 8 hereof, and any
interest, penalties, or additions to tax payable by the Executive with
respect thereto shall be equal to the total present value of the Agreement
Payments and Other Payments at the time such Payments are to be made. The
intent of the parties is that the Company shall be solely responsible for
and shall pay, any Excise Tax on any Payments and any Gross-Up Payment and
any income, payroll and/or employment taxes (including, without limitation,
penalties and interest) imposed on any Gross-Up Payments as well as any loss
of deduction caused by the Gross-Up Payment.
	 
	 	(2)	 	All determinations required to be made under this Section
8(e)(vi), including, without limitation, whether and when a Gross-Up Payment is
required and the amount of such Gross-Up Payment and the assumptions to be
utilized in arriving at such determinations, shall be made by tax counsel
(either a law firm or a nationally recognized public accounting firm) selected
by the Company and reasonably acceptable to the Executive (“Tax Counsel”). The
Company shall cause the Tax Counsel to provide detailed supporting calculations
to the Company and the Executive within fifteen (15) business days after notice
is given by the Executive to the Company that any or all of the Payments have
occurred, or such earlier time as is requested by the Company. Within two (2)
business days after such notice is given to the Company, the Company shall
instruct the Tax Counsel to timely provide the data required by this Section
8(e)(viii) to the Executive. The Company shall pay all fees and expenses of the
Tax Counsel. The Company shall pay any Excise Tax determined pursuant to this
Section 8(e)(viii) to the Internal Revenue Service (the “IRS”) and/or other
appropriate taxing authority on behalf of the Executive within five (5) days
after receipt of the Tax Counsel’s determination. If the Tax Counsel determines
that there is substantial authority (within the meaning of Section 6662 of the
Tax Code) that no Excise Tax is payable by the Executive, the Tax Counsel shall
furnish the Executive with a written 

11

 

	 	 	 	opinion that the failure to disclose or report the Excise Tax on the
Executive’s federal income tax return will not constitute a substantial
understatement of tax or be reasonably likely to result in the imposition of
a negligence or similar penalty. Any determination by the Tax Counsel shall
be binding upon the Company and the Executive in the absence of material
mathematical or legal error. As a result of the uncertainty in the
application of Section 4999 of the Tax Code at the time of the initial
determination by the Tax Counsel hereunder, it is possible that the Company
will not have made Gross-Up Payments that should have been made or that it
will have made Gross-Up Payments that should not have been made, in each
case, consistent with the calculations required to be made hereunder. If the
Company exhausts its remedies pursuant to Section 8(e)(viii)(3) below and
the Executive is thereafter required to pay an Excise Tax, the Tax Counsel
shall determine the amount of underpayment of Excise Taxes that has occurred
and the Company shall promptly pay any such underpayment to the IRS or other
appropriate taxing authority on the Executive’s behalf or, if the Executive
has previously paid such underpayment, to the Executive. Such payment shall
in all events be paid within ninety (90) days after the Tax Counsel
determines that a payment is required. If the Tax Counsel determines that
an overpayment of Gross-Up Payments has occurred, any such overpayment shall
be treated for all purposes as a loan to the Executive with interest at the
applicable federal rate provided in Section 7872(f)(2) of the Tax Code, due
and payable within ninety (90) days after written demand to the Executive by
the Company; provided, however, that the Executive shall have no duty or
obligation whatsoever to repay such loan if the Executive’s receipt of the
overpayment, or any portion thereof, is includible in the Executive’s income
and the Executive’s repayment of the same is not deductible by the Executive
for federal and state income tax purposes.
	 
	 	(3)	 	The Executive shall notify the Company, in writing of any claim
by the IRS or state or local taxing authority, that, if successful, would
result in any Excise Tax or an underpayment of Gross-Up Payments. Such notice
shall be given as soon as practicable but no later than fifteen (15) business
days after the Executive is informed in writing of the claim and shall inform
the Company of the nature of the claim, the administrative or judicial appeal
period, and the date on which any payment of the claim must be paid. The
Executive shall not pay any portion of the claim before the expiration of the
thirty (30) day period following the date on which the Executive gives such
notice to the Company (or such shorter period ending on the date that any
amount under the claim is due). If the Company notifies the Executive in
writing before the expiration of such thirty (30) day period that it desires to
contest the claim, the Executive shall:

	 	(A)	 	give the Company any information reasonably
requested by the Company relating to the claim;

12

 

	 	(B)	 	take such action in connection with contesting
the claim as the Company shall reasonably request in writing from time
to time, including, without limitation, accepting legal representation
concerning the claim by an attorney selected by the Company who is
reasonably acceptable to the Executive; and
	 
	 	(C)	 	cooperate with the Company in good faith in
order to effectively contest the claim; provided, however, that the
Company shall bear and pay directly all costs and expenses (including,
without limitation, additional interest and penalties and attorneys’
fees) incurred in such contests and shall indemnify and hold the
Executive harmless, on an after-tax basis, for any Excise Tax or income
tax (including, without limitation, interest and penalties thereon)
imposed as a result of such representation. Without limitation upon the
foregoing provisions of this Section 8(e)(viii)(3)(C), except as
provided below, the Company shall control all proceedings concerning
such contest and, in its sole opinion, may pursue or forgo any and all
administrative appeal, proceedings, hearings and conferences with the
taxing authority pertaining to the claim. At the Company’s written
request and upon payment to the Executive of an amount at least equal
to the claim plus any additional amount necessary to obtain the
jurisdiction of the appropriate tribunal and/or court, the Executive
shall pay the same and sue for a refund. The Executive agrees to
prosecute any contest of a claim to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one
or more appellate courts, as the Company shall determine; provided,
however, that if the Company requests the Executive to pay the claim
and sue for a refund, the Company shall advance the amount of such
payment to the Executive, on an interest-free basis, and shall
indemnify and hold the Executive harmless on an after-tax basis, from
any Excise Tax or income tax (including, without limitation, interest
and penalties thereon) imposed on such advance or for any imputed
income on such advance. Any extension of the statute of limitations
relating to the assessment of any Excise Tax for the taxable year of
the Executive that is subject of the claim is to be limited solely to
the claim. Furthermore, the Company’s control of the contest shall be
limited to the issues for which a Gross-Up Payment would be payable
hereunder. The Executive shall be entitled to settle or contest, as the
case may be, any other issue raised by the IRS or any other taxing
authority.

	 	(4)	 	If, after the Executive receives an amount the Company advanced
pursuant to Section 8(e)(vii)(3) above, the Executive receives any refund of a
claim and/or any additional amount that was necessary to obtain jurisdiction,
the Executive shall promptly pay to the Company the amount of such refund
(together with any interest paid or credited thereon after

13

 

	 	 	 	taxes applicable thereto). If, after the Executive receives an amount the
Company advanced pursuant to Section 8(e)(vii)(3) above, a determination is
made that the Executive shall not be entitled to any refund of the claim,
and the Company does not notify the Executive in writing of its intent to
contest such denial or refund of a claim before the expiration of the thirty
(30) days after such determination, then the portion of such advance
attributable to a claim shall be forgiven and shall not be required to be
repaid. The amount of such advance attributable to a claim shall offset, to
the extent thereof, the amount of the underpayment required to be paid by
the Company to the Executive.
	 
	 	(5)	 	If, after the Company advances an additional amount necessary
to obtain jurisdiction, there is a final determination made by the taxing
authority that the Executive is not entitled to any refund of such amount, or
any portion thereof, then the Executive shall repay such nonrefundable amount
to the Company within thirty (30) days after the Executive receives notice of
such final determination. A final determination shall occur when the period to
contest or otherwise appeal any decision by an administrative tribunal or court
of initial jurisdiction has been waived or the time for contesting or appealing
the same has expired.

“Change of Control” means the first to occur after the Effective Date of the
following: (i) any “person” or “group” of persons acting in concert (as such terms
are used in Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)), in a transaction or a series of transactions, is or
becomes the Beneficial Owner (as hereinafter defined), directly or indirectly, of
securities of the Company representing more than fifty percent (50%) of the combined
voting power of the Company’s then outstanding securities that have the right to
vote for the election of directors generally (not including in such securities
beneficially owned by such Person any securities acquired directly from or received
through an exchange offer with the Company); or (ii) there is consummated a merger,
consolidation or other business combination (including an exchange of securities
with the security holder’s of a corporation that is a constituent in such business
combination) of the Company or any direct or indirect subsidiary of the Company with
any other corporation, other than a merger, consolidation or business combination
which would result in the voting securities of the Company outstanding immediately
prior to such merger, consolidation or business combination continuing to represent
at least a majority of the combined voting power of the securities having the right
to vote for the election of directors generally of the Company or the surviving
entity or any parent thereof outstanding immediately after such merger,
consolidation or business combination (either by remaining outstanding or by being
converted into or exchanged for voting securities of the surviving entity or parent
thereof) or (iii) there is consummated an agreement for the sale, lease or other
disposition by the Company of all or substantially all of the Company’s assets,
other than a sale, lease or other disposition by the Company of all or substantially
all of the Company’s assets to an entity, at least a majority of the combined voting
power of

14

 

the outstanding securities of which are owned by stockholders of the Company in
substantially the same proportions as their ownership of the Company immediately
prior to such sale. The term “Beneficial Owner” as used herein shall carry the
meaning assigned thereto in Rule 13d-3 and 13d-5 under the Exchange Act, except that
in calculating the beneficial ownership of any particular “person”, such “person”
shall be deemed to have beneficial ownership of all securities that such “person”
has the right to acquire by conversion or exercise of other securities, whether such
right is currently exercisable or is exercisable only after the passage of time.

	 	(viii)	 	Notwithstanding the foregoing, a “Change of Control” shall not be deemed to have
occurred by virtue of the consummation of any transaction or series of integrated
transactions immediately following which the record holders of the stock (entitled to
vote for directors) of the Company immediately prior to such transaction or series of
transactions continue to have substantially the same proportionate ownership in an
entity which owns all or substantially all of the assets of the Company immediately
following such transaction or series of transactions.

	(f)	 	Six-Month Delay For Key Employees. Notwithstanding anything in this Agreement to the
contrary, if the Executive is a key employee of a publicly traded corporation under Section
409A of the Internal Revenue Code of 1986, as amended (“Section 409A”) at the time of his
separation from service and if payment of any amount under this Agreement is required to be
delayed for a period of six (6) months after separation from service pursuant to Section 409A,
payment of such amount shall be delayed as required by Section 409A, and the accumulated
postponed amount shall be paid in a lump sum payment within ten (10) days after the end of the
six-month period. Any amounts not so delayed shall be paid at such times and on such dates as
originally scheduled. A “key employee” shall mean an employee who, at any time during the
12-month period ending on the identification date, is a “specified employee” under Section
409A, as determined by the Board. The determination of key employees, including the number and
identity of persons considered key employees and the identification date, shall be made by the
Board in accordance with the provisions of Sections 416(i) and 409A and the regulations issued
thereunder.
	 
	(g)	 	Mitigation. The Executive shall not be required to mitigate amounts payable pursuant
to this section by seeking other employment or otherwise and there shall be no offset against
any amounts due the Executive under this Agreement on account of any remuneration attributable
to any subsequent employment (including self-employment) that the Executive may obtain. The
amounts payable hereunder shall not be subject to setoff, counterclaim, recoupment, defense or
other right which the Company may have against the Executive or others, except upon obtaining
by the Company a final unappealable judgment or arbitration award against the Executive.
	 
	9.	 	Effect of Termination. If the Executive (a) is a member of the Board or that of any
of the Company’s subsidiaries or, or (b) holds any other position with the Company and the

15

 

	 	 	Company’s subsidiaries on the Date of Termination, the Executive shall resign from all such
positions as of such date.
	 
	10.	 	Termination of Other Agreements. By their execution of this Agreement, each of the
Company and the Executive confirm the termination, as of the Effective Date of all rights and
obligations that each of the parties may have had under (a) the Restated Employment Agreement
between the Executive and USA Mobility, Inc. dated as of November 16, 2004, as amended on
October 30, 2007; (b) the Original Agreement; and (c) any other employment, consulting,
non-competition, bonus or other compensatory plan, program, arrangement or contract relating
to the employment of the Executive, written or oral, between the Executive and the Company,
the Company’s predecessor or any person affiliated with the Company or its predecessor entered
into prior to the Effective Date (together, the “Prior Employment Documents”).
	 
	11.	 	Notices. All notices, demands, requests, or other communications required or permitted to be
given or made hereunder (collectively, “Notice”) shall be in writing and shall be delivered,
telecopied, or mailed by first class registered or certified mail, postage prepaid, addressed
as follows:
	 
	(a)	 	if to the Company:

USA Mobility, Inc.

6677 Richmond Highway

Alexandria, Virginia 22306

Telecopier: (703) 768-9625

with a copy (which shall not constitute notice) to:

Latham and Watkins LLP

555 Eleventh Street, NW

Suite 1000

Washington, DC 20004-1304

Telecopier: (202) 637-2201

Attention: William P. O’Neill, Esq.

	(b)	 	if to the Executive:

Vincent D. Kelly

11807 Chapel Road

Clifton, VA 20124

With a copy (which shall not constitute notice) to:

Williams & Connolly LLP

725 Twelfth Street, NW

Washington, DC 20005

Telecopier: (202) 434-5029

Attention: Deneen C. Howell, Esq.

16

 

or to such other address as may be designated by either party in a notice to the other. Each
notice, demand, request, or other communication that shall be given or made in the manner
described above shall be deemed sufficiently given or made for all purposes three (3) days
after it is deposited in the U.S. mail, postage prepaid, or at such time as it is delivered
to the addressee (with the return receipt, the delivery receipt, the answer back or the
affidavit of messenger being deemed conclusive evidence of such delivery) or at such time as
delivery is refused by the addressee upon presentation.

	12.	 	Severability. The invalidity or unenforceability of any one or more provisions of
this Agreement shall not affect the validity or enforceability of the other provisions of this
Agreement, which shall remain in full force and effect. The parties agree that in the event
any of the provisions in this Agreement, interpreted in accordance with the Agreement as a
whole, are found to be unenforceable by a court of competent jurisdiction, such court shall
determine the limits allowable by law and shall enforce the same.
	 
	13.	 	Survival. It is the express intention and agreement of the parties that the
provisions of Section 5 shall survive the termination of this Agreement, and that the
provisions of Section 6 shall survive for two (2) years following the termination of this
Agreement.
	 
	14.	 	Assignment: Successors. The rights and obligations of the parties to this Agreement
shall not be assignable, except that the rights and obligations of the Company hereunder shall
be assignable in connection with any subsequent merger, consolidation, sale of substantially
all of the assets of the Company, or similar reorganization of a successor. The Company will
require any successor (whether direct or in direct, by purchase, merger, consolidation, or
otherwise) to all or substantially all of the business and/or assets of the Company to
expressly assume and agree to perform this Agreement in the same manner and to the same extent
that the Company is required to perform it. Failure of the Company to obtain such assumption
and agreement before the effectiveness of any such succession shall be a breach of this
Agreement and shall entitle the Executive to compensation from the Company as provided in
Section 8(e) herein.
	 
	15.	 	Binding Effect. Subject to any provisions restricting assignment, this Agreement
shall be binding upon the parties and shall inure to the benefit of the parties and their
respective heirs, devisees, executors, administrators, legal representatives, successors, and
assigns.
	 
	16.	 	Amendment Waiver. This Agreement shall not be amended, altered or modified except by
an instrument in writing duly executed by all parties. Neither the waiver by any of the
parties of a breach of or a default under any of the provisions of this Agreement, nor the
failure of either of the parties, on one or more occasions, to enforce any of the provisions
of this Agreement or to exercise any right or privilege hereunder, shall thereafter be
construed as a waiver of any subsequent breach or default of a similar nature, or as a waiver
of any such provisions, rights, or privileges.
	 
	17.	 	Headings. Section headings contained in this Agreement are inserted for convenience
of reference only, shall not be deemed to be a part of this Agreement for any purpose, and

17

 

	 	 	shall not in any way define or affect the meaning, construction, or scope of any of the
provisions of this Agreement.
	 
	18.	 	Governing Law. This Agreement, the rights and obligations of the parties, and any
claims or disputes arising from this Agreement, shall be governed by and construed in
accordance with the laws of the Commonwealth of Virginia (but not including the choice of law
rules thereof).
	 
	19.	 	Entire Agreement. This Employment Agreement contains the entire agreement between the
parties with respect to the subject matter hereof and supersedes all prior agreements, written
or oral, with respect thereto, including, but not limited to, the Prior Employment Documents.
	 
	20.	 	Indemnification. In consideration of this Agreement, the Executive hereby waives any
and all rights under and releases, and indemnifies and holds the Company (and its officers,
directors, employees and agents) and its successors and assigns, harmless from any damage,
loss, liability, judgment, fine, penalty, assessment, settlement, cost, or expense including,
without limitation, reasonable expenses of investigation, reasonable attorneys’ fees and other
reasonable legal costs and expenses incident to any of the foregoing or to the enforcement of
this Section 21, whether or not suit is brought or, if brought, whether or not such suit is
successful, in whole or in part arising out of or relating to any and all employment,
consulting, non-competition, bonus, or other compensatory plan, program, arrangement, or
contract relating to the employment of the Executive, written or oral, between the Executive
and the Company or any person affiliated with the Company entered into prior to the Effective
Date, including, without limitation, the Prior Employment Documents.
	 
	21.	 	Arbitration. Either party may designate in writing to the other (in which case this
Section 21 shall have effect but not otherwise) that any dispute that may arise directly or
indirectly in connection with this Agreement, the Executive’s employment, or the termination
of the Executive’s employment, whether arising in contract, statute, tort, fraud,
misrepresentation, or other legal theory, shall be determined solely by arbitration in
Washington, D.C. under the National Rules for the Resolution of Employment Disputes of the
American Arbitration Association (the “AAA”). The only legal claims between the Executive, on
the one hand, and the Company or any subsidiary, on the other, that would not be included in
this Agreement to arbitrate are claims by the Executive for workers’ compensation or
unemployment compensation benefits, claims for benefits under a Company or subsidiary benefit
plan if the plan does not provide for arbitration of such disputes, and claims by the
Executive that seek judicial relief during the pendency of any dispute or controversy in the
form of specific performance of the right to be paid until the Date of Termination and to be
paid all other unpaid amounts, if any, to which the Executive is entitled as of such Date of
Termination, under any Company fringe benefit or incentive compensation plan or program, at
the time such payments are due (including, without limitation, any Annual Bonus to the extent
unpaid in respect of the calendar year ending prior to the Date of Termination). If this
Section 21 is in effect, any claim with respect to this Agreement, the Executive’s employment,
or the termination of the Executive’s employment must be established by a preponderance 

18

 

	 	 	of the evidence submitted to the impartial arbitrator. A single arbitrator shall conduct any
arbitration. The arbitrator shall have the authority to order a pre-hearing exchange of
information by the parties including, without limitation, production of requested documents,
and examination by deposition of parties and their authorized agents. If this Section 21 is
in effect, the decision of the arbitrator (i) shall be final and binding, (ii) shall be
rendered within ninety (90) days after the impanelment of the arbitrator, and (iii) shall be
kept confidential by the parties to such arbitration. The arbitration award may be enforced
in any court of competent jurisdiction. The Federal Arbitration Act, 9 U.S.C. §§ 1-15, not
state law, shall govern the arbitrability of all claims.
	 
	22.	 	Counterparts. This Agreement may be executed in two or more counterparts (including
via facsimile and via pdf delivered electronically, each of which shall be an original and all
of which shall be deemed to constitute one and the same instrument.
	 
	 	 	IN WITNESS WHEREOF, the undersigned have duly executed this Agreement, or have caused this
Agreement to be duly executed, on their behalf as of the day and year first hereinabove written.

	 	 	 	 	 
	 	USA Mobility, Inc.

 	 
	Date: October 30, 2008	By:  	/s/ Bonnie Culp
 	 
	 	 	Bonnie Culp 	 
	 	 	Executive Vice President, HR 	 
	 
	 	 	 
	Date: October 30, 2008 	/s/ Vincent D. Kelly 	 
	 	Vincent D. Kelly 	 
	 	 	 

19

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