Document:

Exhibit 10.11

 Exhibit 10.11 
  
 AMENDMENT NO. 1 TO GOVERNANCE AGREEMENT 
  
 AMENDMENT NO. 1 dated as of March 29, 2005 to the Governance Agreement dated as of October 6, 2003 among ITC^DeltaCom, Inc.,
a Delaware corporation (“ITC^DeltaCom”), and each Person listed on the signature pages thereof or otherwise a party thereto in accordance with its terms (the “Governance Agreement”); 
  
 W I T N E S S E T H : 
  
 WHEREAS, ITC^DeltaCom and certain of the Persons listed on the signature
pages hereof under the heading “WCAS Current Securityholders” (each, a “Current Securityholder” and collectively, the “WCAS Holders”) have entered into the Credit Agreement dated as of the date hereof with
the subsidiary guarantors named therein and the other parties thereto (the “Third Lien Credit Agreement”), pursuant to which WCAS is lending $20,000,000 to ITC^DeltaCom;  
  
 WHEREAS, in connection therewith, ITC^DeltaCom, Inc. proposes to issue and
deliver to the WCAS Holders pursuant to a Warrant Agreement dated as of the date hereof between ITC^DeltaCom, Inc. and Mellon Investor Services LLC, as Warrant Agent, 20,000,000 warrants (each, a “March 2005 Warrant”) to
purchase an equal number of shares of the Common Stock, par value $.01 per share, of ITC^DeltaCom, Inc. (along with any shares of Common Stock that may be issued pursuant to certain antidilution provisions of the March 2005 Warrants, the
“March 2005 Warrant Shares”); 
  
 WHEREAS, in
connection with the issuance of the March 2005 Warrants, the parties hereto desire to (i) amend the Governance Agreement to modify the limitations on the WCAS Holders or their Affiliates acquiring Voting Securities of Parent and (ii) acknowledge
that the March 2005 Warrants and the March 2005 Warrant Shares are “Registrable Securities” under and for purposes of the Registration Rights Agreement; 
  
 WHEREAS, the Persons signing this Amendment under the heading “WCAS Current Securityholders” beneficially own a
majority of the Voting Power represented by the Voting Securities beneficially owned by the WCAS Holders and their Affiliates; and 
  
 WHEREAS, this Amendment has been duly approved by Parent pursuant to a Determination of the Committee of Independent Directors to approve this Amendment;

  

 NOW, THEREFORE, the parties hereto agree as follows: 
  
 1. Defined Terms; References. Unless otherwise specifically defined
herein, each term used herein, including in the preamble hereof, that is defined in the Governance Agreement has the meaning assigned to such term in the Governance Agreement. Each reference to “hereof,” “hereunder,”
“herein” and “hereby” and each other similar reference and each reference to “this Agreement” and each other similar reference contained in the Governance Agreement shall, after this Amendment becomes effective, refer
to the Governance Agreement as amended hereby. 
  
 2.
Preamble. The first paragraph of the preamble of the Governance Agreement is amended in its entirety to read as follows: 
  
 GOVERNANCE AGREEMENT, dated as of October 6, 2003 (this “Agreement”), between ITC^DeltaCom Inc., a Delaware corporation
(“Parent”), and each Person listed on the signature pages hereof under the heading “WCAS Securityholders” (each, and each Permitted Transferee of such Person that agrees in writing to be bound by the terms and conditions of this
Agreement, a “WCAS Securityholder” and collectively, “W”) and each Other Holder (as defined in Section 1.1). 
  
 3. Definition of Amended Ownership Percentage. The following definition of “Amended Ownership Percentage” is added in alphabetical order
to Section 1.1 of the Governance Agreement: 
  
 “Amended Ownership Percentage” means the Ownership Percentage represented by the number of shares of Common Stock beneficially owned by W immediately following the issuance of the March 2005 Warrants. For purposes of this
definition, the number of shares of Common Stock beneficially owned by W immediately following the issuance of the March 2005 Warrants shall be calculated assuming the conversion, exchange or exercise into or for shares of Common Stock of all Voting
Securities beneficially owned by W at such time. 
  
 4.
Definition of March 2005 Warrants. The following definition of “March 2005 Warrants” is added in alphabetical order to Section 1.1 of the Governance Agreement. 
  
 “March 2005 Warrants” means the 20,000,000 warrants to purchase an equal number of shares
of Common Stock issued pursuant to the Warrant Agreement dated as of March 29, 2005 between Parent and Mellon Investor Services LLC, as Warrant Agent. 
  

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 5. Acquisition of Voting Securities and Business Combinations. Section 3.1 of the Governance
Agreement is amended in its entirety to read as follows: 
  
 SECTION 3.1. Purchases of Voting Securities. W agrees and covenants that following the Effective Time W shall not, and shall cause each of its Affiliates not to, acquire, offer or propose to acquire, or agree
to acquire, directly or indirectly, by purchase or otherwise, beneficial ownership of any Voting Securities, except (i) as approved by a Determination of the Committee of Independent Directors, (ii) upon exercise or conversion of any Voting
Securities or Voting Security Equivalents then owned by W and its Affiliates, (iii) upon the issuance of any Voting Securities or Voting Security Equivalents, as dividends or otherwise, in respect of securities beneficially owned by W or its
Affiliates on the date of the Effective Time or March 29, 2005 or in substitution therefor, or in connection with any stock split, dividend or combination, or any reclassification, recapitalization, merger, consolidation, exchange or similar
reorganization, (iv) as contemplated by Section 8.21 or Article 10 of the Merger Agreement, (v) during the Transfer Restriction Period, W and its Affiliates may acquire, in addition to any acquisitions pursuant to clauses (i) through (iv), in the
open market or through privately negotiated transactions or from Parent, beneficial ownership of Voting Securities as long as W and its Affiliates do not, following any such acquisition, have an aggregate Ownership Percentage in excess of the sum of
the Amended Ownership Percentage, plus 5%, or (vi) following the Transfer Restriction Period, W and its Affiliates may acquire, in addition to any acquisitions pursuant to clauses (i) through (iv), in the open market or through privately negotiated
transactions or from Parent, beneficial ownership of Voting Securities as long as W and its Affiliates do not, following any such acquisition, have an aggregate Ownership Percentage in excess of the sum of the Amended Ownership Percentage, plus 15%.

  
 6. Acknowledgment. ITC^DeltaCom acknowledges that the
March 2005 Warrants and the March 2005 Warrant Shares are “Registrable Securities” under and for purposes of the Registration Rights Agreement. 
  
 7. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of Delaware. 
  
 8. Counterparts. This Amendment may be executed and delivered
(including by facsimile transmission) in any number of counterparts, each of 

  

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which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 
  
 9. Effectiveness. This Amendment shall become effective as of the date
hereof. 
  

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 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date
first above written. 
  

					
	ITC^DELTACOM, INC.
		
	By:	 	/s/    J. THOMAS
MULLIS        
	 	 	 Name:
	 	J. Thomas Mullis            
	 	 	 Title:
	 	Senior Vice President–Legal and Regulatory            
	
	WCAS CURRENT SECURITYHOLDERS:
	
	WCAS CAPITAL PARTNERS III, L.P.
	By:	 	 WCAS CP III Associates L.L.C.
 General Partner

		
	By:	 	/s/    JONATHAN M.
RATHER        
	 	 	 Name:
	 	Jonathan M. Rather            
	 	 	 Title:
	 	Managing Member            
	
	 WELSH, CARSON, ANDERSON &
STOWE VIII, L.P.

	By:	 	 WCAS VIII Associates LLC,
 General Partner

		
	By:	 	/s/    JONATHAN M.
RATHER        
	 	 	 Name:
	 	Jonathan M. Rather            
	 	 	 Title:
	 	Managing Member            

  

			
	Certain individual investors and trusts
		
	By:	 	/s/    JONATHAN M.
RATHER        
	 	 	 Jonathan M. Rather, as Attorney-in-fact
  
 for the individual investors listed below:

		
	 	 	 Patrick J. Welsh
 Russell L. Carson
 Bruce K. Anderson
 Andrew M. Paul
 Thomas E. McInerney
 Robert A. Minicucci
 Paul B. Queally
 Anthony J. de Nicola
 D. Scott Mackesy
 Sanjay Swani
 Laura VanBuren
 Sean Traynor
 John Almeida
 Eric J. Lee
 James R. Matthews
 IRA f/b/o Jonathan M. Rather

  

			
	Other trusts:
	
	 Mary R. Anderson TTEE of The Bruce K. Anderson 2004 Trust

	 The Bruce K. Anderson 2004 Irrevocable Trust

		
	By:	 	/s/    MARY R. ANDERSON        
	 Name:
	 	Mary R. Anderson
	 Title:
	 	Trustee
	
	 Carol Welsh TTEE of the Patrick Welsh 2004 Irrevocable Trust

		
	By:	 	/s/    CAROL WELSH        
	 Name:
	 	Carol Welsh
	 Title:
	 	TrusteeExhibit 10.12

 Exhibit 10.12 
  
 EMPLOYMENT AGREEMENT 
  
 THIS EMPLOYMENT AGREEMENT (“Agreement”) is made as of the 3rd day of February, 2005 by and between ITC^DeltaCom Inc., a Delaware corporation
(“Employer” or the “Company”), and Randall E. Curran (“Employee”). 
  
 RECITALS 
  
 WHEREAS, the Company desires to employ Employee as provided herein; and 
  
 WHEREAS, Employee desires to be employed by Employer as provided herein; 
  
 NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties agree as follows: 
  
 1. EMPLOYMENT. The Company agrees to employ Employee and Employee
hereby agrees to be employed on a full-time basis by the Company, and by such of its subsidiary corporations as determined by the Board of Directors of the Company (the “Board”) in such position with such corporations as is designated by
the Board, for the period and upon the terms and conditions hereinafter set forth. 
  
 2. DUTIES. Employee shall serve as Chief Executive Officer of the Company and, if and when appointed or elected to the Board, as a member of the Board. During his employment, Employee shall perform the duties
and bear the responsibilities commensurate with his position and shall report directly to the Board. During the Term (as defined below) of the Agreement, and excluding any periods of vacation, holiday, personal leave and sick leave to which Employee
is entitled, Employee shall devote Employee’s full business time, attention and ability to the business and affairs of the Company. 
  
 3. COMPENSATION AND BENEFITS. 
  
 (a) Base Salary. The Company shall pay Employee during the Term of this Agreement a base salary at an annual rate of five hundred
thousand dollars ($500,000), which shall be payable bi-weekly or otherwise in accordance with the Company’s regular payroll practices. Employee’s base salary, as in effect at any time, is hereinafter referred to as the “Base
Salary.” The Base Salary may be increased from time to time in accordance with normal business practices of the Company and, if so increased, shall not thereafter be reduced unless any such reduction occurs on a proportionate across-the-board
basis among all executive employees of the Company (the “Key Employees”), provided that in no event shall the Base Salary as a result of any such reduction be reduced to an annual rate below five hundred thousand dollars ($500,000) without
the consent of Employee. Compensation of Employee by salary payments shall not be deemed exclusive and shall not prevent Employee from participating in any other compensation, bonus or benefit plan of the Company. The salary payments hereunder shall
not in any way limit or reduce any other obligation of the Company hereunder, and no other compensation, benefit or payment hereunder shall in any way limit or reduce the obligation of the Company to pay Employee’s salary hereunder. 

 

 (b) Benefits. In addition to salary as provided above, the Company shall provide
Employee, during the Term of this Agreement, with the benefits of such insurance plans, benefit plans, hospitalization plans and other perquisites as shall be generally provided to Key Employees and for which Employee may be eligible under the terms
and conditions thereof. In the event that Employee is not permitted to commence participation in the Company’s medical insurance plan as of the Effective Date as a result of waiting periods imposed under the terms of such plan, then the Company
shall reimburse Employee for any COBRA (as defined below) premium paid by Employee between the Effective Date and the time Employee becomes eligible to participate in any Company medical insurance plan. 
  
 (c) Annual Bonus. For each of the Company’s
fiscal years (each, a “Fiscal Year”) that occurs during the Term of this Agreement, beginning with the Fiscal Year ending December 31, 2005, Employee shall be eligible to earn an annual cash bonus (the “Bonus”) in a maximum
amount equal to one hundred percent (100%) of Base Salary in respect of such Fiscal Year based upon the achievement by the Company of such performance goals for such Fiscal Year as are established by the Compensation Committee of the Board (the
“Compensation Committee”), provided that, for the Fiscal Years ending December 31, 2005 and December 31, 2006, payment of the Bonus shall be based upon the achievement of the performance goals for such Fiscal Years set forth in Exhibit A.
In addition to the terms and conditions for payment of any Bonus (including the terms and conditions set forth in Exhibit A), the Compensation Committee may, in its discretion, approve the payment of an additional cash Bonus (the “Additional
Bonus”) for any Fiscal Year in a maximum amount equal to twenty-five percent (25%) of Base Salary in effect in respect of such Fiscal Year, so that, in the aggregate, the Bonus and the Additional Bonus in respect of any Fiscal Year shall be in
a maximum amount equal to one hundred twenty-five percent (125%) of Base Salary for such Fiscal Year. The Bonus and Additional Bonus, if any, payable to Employee in respect of any Fiscal Year shall be paid at the same time that bonuses are paid to
other Key Employees, but in any event within seventy-five (75) days after the conclusion of such Fiscal Year. 
  
 (d) Business Expenses. Throughout the Term of this Agreement, the Company shall promptly reimburse Employee for all reasonable
out-of-pocket expenses incurred by Employee in connection with the business of the Company, including, without limitation, expenses incurred in traveling between Denver, Colorado and the Company’s headquarters until the Employee is required to
relocate to the State of Georgia in accordance with the terms of Section 3(e) hereof, and the performance of his duties under this Agreement upon presentation to the Company by Employee of a reasonably itemized accounting of such expenses with
reasonable supporting data. 
  
 (e)
Relocation. The Company shall pay or reimburse Employee for the reasonable costs and expenses of relocating from Denver, Colorado to the vicinity of the Company’s headquarters up to an aggregate amount not to exceed two hundred fifty
thousand dollars ($250,000) (before any tax gross-up). Such expenses shall include (i) travel, transportation, meals, temporary lodging and similar related moving expenses and (ii) closing costs, real estate commissions, attorney’s fees and
other similar costs incurred in connection with the relocation. All expenses subject to income tax shall be grossed up such that the state and federal tax effect to Employee is zero. Employee shall not be required to relocate to the vicinity 

  

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of the Company’s headquarters until his home in Denver, Colorado is sold and the Company consummates a Debt Restructuring (as defined below).

  
 4. TERM. The Term of this Agreement shall commence on
February 3, 2005 (the ”Effective Date”) and shall continue until the second anniversary of the Effective Date, unless terminated earlier pursuant to Section 6 hereof (the “Term”), provided, however, that the Term of this
Agreement shall be automatically extended for successive one-year periods after the second anniversary of the Effective Date unless either party notifies the other in writing of the notifying party’s intention not to so extend the Term of this
Agreement (a “Notice of Non-Renewal). Any Notice of Non-Renewal must be given to the other party not later than the first anniversary of the Effective Date to terminate the Term of this Agreement as of the second anniversary of the Effective
Date, and after such first anniversary not later than any subsequent anniversary of the Effective Date to terminate the Term of this Agreement as of the immediately succeeding anniversary date. 
  
 5. EQUITY PARTICIPATION. 
  
 (a) Restricted Stock. The Company is contemplating a
restructuring of its capital structure upon terms that will be approved by the Board (the “Debt Restructuring”) in which Employee is expected to play a critical role. To induce Employee to accept employment with the Company, promptly
following consummation of the Debt Restructuring (if any), Employee shall receive a grant of restricted shares (the “Restricted Shares”) representing five percent (5%) of each class or series of equity securities of the Company as herein
provided (each such class or series, a “Class”) outstanding immediately following the completion of the Debt Restructuring and after giving effect to such grant and to any other similar grant (a “Parallel Inducement Grant”) to
any other officer of the Company, calculated on a Fully Diluted Basis, as determined in good faith by the Board or an authorized committee thereof. For purposes of this Section 5(a), a Class of Restricted Shares shall include common stock, each
class or series of preferred stock, and each class or series of warrants to purchase preferred stock, but only if such class or series of warrants is in-the-money as of the date of determination. To the extent reasonably practicable, any grant of
common stock shall be made in the form of restricted stock units containing terms consistent with the terms of this Section 5(a). If the Debt Restructuring shall be accomplished in more than one transaction, Employee shall receive a grant of
Restricted Shares of each new Class, if any, authorized and issued in connection with, and outstanding immediately following the consummation of, such subsequent transaction promptly following such consummation so that, immediately following such
consummation and after giving effect to such grant and any Parallel Inducement Grant, the Restricted Shares of such new Class granted to Employee shall equal five percent (5%) of such new Class on a Fully Diluted Basis, as determined in good faith
by the Board or an authorized committee thereof. For purposes of this Section 5(a), “Fully Diluted Basis” shall mean, with respect to shares of each Class as of the date of determination, the sum of (x) the number of shares of such Class
outstanding as of such date of determination plus (y) the number of shares of such Class issuable as of such date of determination upon the exercise, conversion or exchange of all then-outstanding options, stock units, indebtedness or other rights
(other than preferred stock or warrants exercisable, convertible or exchangeable for or into such Class that are separately granted to Employee hereunder) exercisable for or convertible or exchangeable into, directly or indirectly, shares of such
Class, whether at the time of issuance or upon the passage of time or upon the occurrence of vesting or 

  

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other future event, provided that such options, stock units, indebtedness or other rights are in-the-money as of such date of determination, but excluding
the number of shares of such Class, if any, issuable as of such date of determination in payment of accrued and unpaid dividends on such Class. If the holders of any Class shall agree in any subsequent transaction involving the Debt Restructuring to
exchange such Class for a new Class, or to accept cancellation of such Class in consideration for the issuance of a new Class, Employee’s right hereunder to receive a grant representing five percent (5%) of such new Class, calculated on a Fully
Diluted Basis, promptly following the consummation of such transaction shall be conditioned on the concurrent surrender by Employee to the Company of such Employee’s ownership of the Class so exchanged or canceled or, as the case may be, the
number of shares of common stock that, upon grant to Employee hereunder, were calculated based on the Class so exchanged or canceled. Notwithstanding the foregoing, if the Board determines in good faith, after consulting with Employee, that it is
not practicable to issue a particular Class of Restricted Shares to Employee, the Board shall grant Restricted Shares of a different Class (the “Replacement Restricted Shares”) to Employee in lieu of the Restricted Shares not granted to
Employee. The Replacement Restricted Shares shall be economically equivalent to the Class of Restricted Shares in respect of which they are being granted, as determined in good faith by the Board or an authorized committee thereof. For purposes of
determining economic equivalence, no value shall be ascribed to the voting rights of the Restricted Shares in respect of which the Replacement Restricted Shares are being granted. To the extent that the Debt Restructuring is accomplished by means of
a sale of all or substantially all of the Company’s assets, or a merger or stock sale as a result of which there are no shares of any Class outstanding following consummation of the Debt Restructuring, in lieu of the Restricted Shares, Employee
shall receive upon consummation of the Debt Restructuring consideration equal to five percent (5%) of the consideration received by all Classes in the Debt Restructuring (i) to the extent practicable under the terms of the transaction, in the same
form and proportion as received by each such Class, and (ii) to the extent not practicable under the terms of the transaction, in cash equal to the fair market value of such consideration as determined in good faith by the Compensation Committee,
forty percent (40%) of which shall vest immediately and sixty percent (60%) of which shall vest on the same schedule on which the Restricted Shares would have vested pursuant to Section 5(b). 
  
 (b) Vesting of Restricted Shares. Subject to the
immediately following sentence and acceleration of vesting as set forth in Section 6(a) hereof, the Restricted Shares shall vest as follows: (i) sixty percent (60%) of each Class of the Restricted Shares shall vest ratably over three (3) years on
each anniversary of the Effective Date (collectively, the “Time Vested Stock”); (ii) twenty percent (20%) of each Class of the Restricted Shares shall vest on the Performance Achievement Date (as defined below) upon achievement of $90
million of EBITDA (as defined below) for any EBITDA Performance Period (as defined below); and (iii) twenty percent (20%) of each Class of the Restricted Shares shall vest on the Performance Achievement Date upon achievement of $105 million of
EBITDA for any EBITDA Performance Period. Notwithstanding the foregoing, if payment-in-kind dividends in shares of any Class (“PIK Shares”) shall be payable in respect of such Class, vesting of the Restricted Shares with respect to such
Class shall also be subject to the following additional principles: (i) shares of such Class payable as PIK Shares shall not be considered in calculating vesting of Restricted Shares of such Class until such PIK Shares are issued; (ii) on any issue
date of PIK Shares of such Class following the first date on which a vesting of Restricted Shares of such Class has occurred in accordance with the immediately preceding sentence, a number of such PIK Shares 

  

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shall vest immediately upon issuance that shall equal the difference of (x) the product of (a) the percentage of the Restricted Shares of such Class that are
then vested in accordance with the immediately preceding sentence, multiplied by (b) the total number of Restricted Shares of such Class that are outstanding immediately following the issuance of such PIK Shares (rounded up to the nearest one
ten-thousandth of one share), minus (y) the total number of Restricted Shares of such Class that shall have been vested immediately prior to the issuance of such PIK Shares (rounded up to the nearest one ten-thousandth of one share); (iii) in
no event, as a result of any rounding of Restricted Shares in accordance with clause (ii) above, shall Employee be deemed to be vested as of any date in a number of Restricted Shares that shall exceed the total number of Restricted Shares then
outstanding; and (iv) for purposes of the foregoing calculation, the conversion, exercise or exchange of Restricted Shares of such Class into or for securities of any other series or class shall not result in any vesting of PIK Shares before the
date on which such PIK Shares would have vested in the absence of such conversion, exercise or exchange. For purposes of this Section 5(b), “Performance Achievement Date” shall mean the date on which the Chief Financial Officer of the
Company shall certify the Company’s achievement of $90 million or $105 million of EBITDA, as the case may be, for any EBITDA Performance Period. For purposes of this Section 5(b), “EBITDA Performance Period” shall mean the four most
recent full fiscal quarters of the Company for which internal financial statements are available. For purposes of this Agreement (including Section 3(c) hereof and this Section 5(b)), “EBITDA” shall mean, for the Company and its
subsidiaries for any period, the sum, determined on a consolidated basis, of net income (or net loss) after eliminating (i) extraordinary and/or non-recurring items to the extent included in net income, (ii) interest expense, (iii) income tax
expense, (iv) depreciation expense, (v) amortization expense, and (vi) any direct expenses and accounting charges (including, but not limited to, professional fees, severance costs and financing fees) incurred in or related to the Debt
Restructuring, any sale of the Company’s assets, this Agreement or similar agreements entered into with newly hired senior executives. For the avoidance of doubt, EBITDA for all of the fiscal quarter ending March 31, 2005 shall be applied
toward (i) the EBITDA targets for the Fiscal Year ending December 31, 2005 set forth in Exhibit A and (ii) the EBITDA targets referred to in clauses (ii) and (iii) above notwithstanding the fact that Employee was not employed by the Company until
the Effective Date. If the Company should sell one or more businesses during an EBITDA Performance Period, the EBITDA target for such Performance Period shall be reduced by the amount of the EBITDA actually contributed by the sold business during
the four most recent full fiscal quarters preceding the closing of the sale and the EBITDA achieved during the EBITDA Performance Period shall be reduced by the amount of the EBITDA actually achieved during such period by such sold business, in each
case using allocations approved in good faith by the Compensation Committee. 
  
 (c) Co-Investment Opportunity. During the Term of this Agreement, and subject to compliance with applicable law and, for so long as any class of the Company’s securities is listed on The Nasdaq Stock
Market, Inc., the Nasdaq Marketplace Rules, Employee shall be entitled to participate in any offerings by the Company of its equity securities in capital-raising transactions exempt from registration under the Securities Act of 1933, as amended (the
“Securities Act”), on substantially the same terms as other purchasers of such equity securities. The Company’s offering and issuance of equity securities, (i) pursuant to the ITC DeltaCom, Inc. Stock Incentive Plan or any other
director or employee benefit plan, (ii) upon the conversion, exercise or exchange of outstanding warrants, preferred stock, convertible indebtedness or other 

  

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similar rights or (iii) as consideration for the acquisition of any businesses or assets shall not be considered capital-raising transactions for purposes of
this Section 5(c). 
  
 (d) Stockholders
Agreements. To the extent that securities of the Company issued and outstanding at the consummation of the Debt Restructuring are subject to one or more stockholders agreements by and among the Company and certain of its stockholders which
contain customary transfer restrictions and other customary terms and conditions relating to the governance of the Company, Employee agrees to execute and be bound by such stockholders agreement. 
  
 (e) Investment Representations. Employee represents
to the Company that he (i) is an “accredited investor” as defined in Rule 501(a) under Regulation D of the Securities Act, (ii) is acquiring the Restricted Shares (including any PIK Shares) for investment purposes for his own account, and
not as a nominee or agent, and not with a view to, or for sale in connection with, the distribution of all or any part of the Restricted Shares within the meaning of the Securities Act, and (iii) has such knowledge and experience in financial and
business matters that he is capable of evaluating the merits and risks of such investment in the Restricted Shares. 
  
 6. TERMINATION OF EMPLOYMENT. 
  
 (a) Without Cause; For Good Reason; Non-Extension of Term. If Employee’s employment is terminated (i) by the Company without
Cause (as defined below), (ii) by Employee for Good Reason (as defined below) or (iii) as a result of a non-renewal of the Term of this Agreement by the Company, then Employee shall be entitled to receive within thirty (30) days following the date
of termination of employment (the “Termination Date”) (i) all accrued but unpaid compensation, (ii) reimbursement of any outstanding business expenses for which Employee is entitled to be reimbursed, (iii) an amount equal to eighteen (18)
months of Base Salary at the annual rate in effect on the Termination Date and (iv) and a pro rata portion of any Bonus payable in respect of the Fiscal Year in which the Termination Date occurs, assuming for purposes of this Section 6(a) that, if
the Termination Date occurs in the Fiscal Year ending December 31, 2005 or December 31, 2006, the one hundred percent (100% ) target set forth in Exhibit A is achieved. In addition, all Time Vested Stock shall vest on the Termination Date to the
extent not then vested. Furthermore, Employee shall be entitled to continue to participate in all health and welfare plans of the Company with no increase in cost to Employee as in effect on the Termination Date until the earlier of (i) eighteen
(18) months following the Termination Date or (ii) the date on which Employee violates any of the provisions set forth in Section 7 hereof. The period for the required continuation coverage under Section 601 et seq. of the Employee Retirement Income
Security Act of 1974, as amended, and Section 4980B of the Internal Revenue Code of 1986, as amended (known as “COBRA”), shall be considered to begin on the Termination Date. 
  
 (b) Termination for Cause or Without Good Reason. If Employee’s employment is terminated by the
Company for Cause or by Employee without Good Reason, then Employee shall be entitled to receive within thirty (30) days following the Termination Date, a lump sum cash payment equal to all accrued but unpaid compensation and reimbursement of any
outstanding business expenses for which Employee is entitled to be 

  

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reimbursed. Employee shall forfeit to the Company any Restricted Shares that remain unvested as of the Termination Date. 
  
 (c) Execution of Release. As a condition to the
Company’s obligation to pay any form of severance to Employee upon the termination of Employee’s employment with the Company, Employee shall, at the time of such termination, execute and deliver to the Company (and shall fail to revoke
within such time periods as may be established by law) a full and unconditional release, in form and substance reasonably satisfactory to the Company, in favor of the Company and its subsidiaries, directors, officers and other affiliates of all
obligations other than those set forth in this Agreement, provided that, if Employee terminates employment for Good Reason as a result of the Company’s failure to grant Restricted Shares as contemplated under Section 5(a) hereof,
Employee shall not be required to release his rights with respect to the Restricted Shares. 
  
 7. DEFINITIONS. 
  
 (a) Cause. For purposes of this Agreement, “Cause” shall mean any of the following: (i) willful and continued failure by Employee to substantially perform his duties hereunder (other than any such failure arising from his
disability), provided that Employee shall first have received a notice in writing from the Board specifying in reasonable detail the alleged failures and providing Employee a reasonable opportunity to cure such alleged failures; (ii) the
Employee’s conviction of, or plea of guilty or nolo contendere to, a misdemeanor involving theft or moral turpitude or any felony; or (iii) any act of intentional dishonesty or intentional misconduct by Employee resulting in demonstrable
harm to the Company. 
  
 (b) Good Reason.
For purposes of this Agreement, “Good Reason” shall mean the occurrence of any of the following events: (i) any directive by the Company requiring Employee to relocate more than fifty (50) miles from the Company’s corporate
headquarters in effect as of the consummation of the Debt Restructuring; (ii) any reduction in Base Salary (except as permitted under Section 3(a) hereof), Bonus opportunity or Additional Bonus opportunity; (iii) the failure of Employee to be
appointed or nominated for election to serve as a member of the Board; (iv) the failure by the Company to grant Restricted Shares as contemplated under Section 5(a) hereof; or (v) any material adverse change in Employee’s duties or
responsibilities, provided that, with respect to each of clauses (i), (ii), (iii), (iv) and (v) above, Employee shall first have given written notice to the Board regarding such occurrence of Good Reason and the Company subsequently shall fail to
remedy such occurrence of Good Reason within ten (10) days of receipt of such notice. 
  
 8. RESTRICTIVE COVENANTS. 
  
 (a) Non-Compete. During Employee’s employment with the Company and during the eighteen (18) month period commencing on the Termination Date, Employee shall not, directly or indirectly, whether as owner,
consultant, employee, partner, venturer, agent, through stock ownership, investment of capital, lending of money or property, rendering of services, or otherwise, compete with the Company or any of its subsidiaries or other controlled affiliates in
any business in which any of them is engaged while Employee is employed with Company (such businesses are hereinafter referred to as the “Business”), or assist, become 

  

 7 

 
interested in or be connected with any corporation, firm, partnership, joint venture, sole proprietorship or other entity which so competes with the
Business. During the eighteen (18) month period commencing on the Termination Date, the restrictions imposed by this Section 8(a) shall not apply to any business in which the Company or its subsidiaries or other controlled affiliates were not
engaged at the time of termination of Employee’s employment hereunder or to any geographic area in which the Company or its subsidiaries or other controlled affiliates were not engaged in the Business at the time of termination. Notwithstanding
the foregoing, in the event that the Company breaches Section 6 hereof by failing to pay Employee any amounts that he is owed under such Section 6, then Employee shall not be bound by the provisions of this Section 8(a). 
  
 (b) Non-Solicitation. 
  

	 	(i)	During Employee’s employment with the Company and during the eighteen (18) month period commencing on the Termination Date, Employee shall not, directly or indirectly,
influence or attempt to influence customers or suppliers of the Company or any of its parents, subsidiaries or controlled affiliates to divert their business to any business, individual, partner, firm, corporation or other entity that is then a
direct competitor of the Company or its parents, subsidiaries or affiliates (each such competitor, a “Competitor of the Company”). 

  

	 	(ii)	Employee recognizes that he will possess confidential information about other employees of the Company and its parents, subsidiaries or affiliates relating to their education,
experience, skills, abilities, compensation and benefits, and interpersonal relationships with customers of the Company and its subsidiaries or their affiliates. Employee recognizes that the information he will possess about these other employees is
not generally known, is of substantial value to the Company and its subsidiaries in developing their business and in securing and retaining customers, and will be acquired by him because of his business position with the Company. Employee agrees
that, during Employee’s employment with the Company and during the eighteen (18) month period commencing on the Termination Date he shall not, directly or indirectly, solicit or recruit any employee of the Company or its parents, subsidiaries
or affiliates for the purpose of being employed by him or by any Competitor of the Company on whose behalf he is acting as an agent, representative or employee and that he shall not convey any such confidential information or trade secrets about
other employees of the Company and its parents, subsidiaries or affiliates to any other person. Notwithstanding the foregoing, in the event that the Company breaches Section 6 hereof by failing to pay Employee any amounts that he is owed under such
Section 6, then Employee shall not be bound by the provisions of this Section 8(b). 

  

 8 

 (c) Confidentiality. “Confidential Information” shall mean non-public
information about the Company and its parents, subsidiaries or affiliates, and their respective clients and customers, that is not disclosed by the Company or its parents, subsidiaries or affiliates for financial reporting purposes and that was
learned or acquired by Employee in the course of his employment with the Company, including, without limitation, any proprietary knowledge, trade secrets, data, formulae, information and client and customer lists and all papers, resumes and records
(including computer records) of the documents containing such Confidential Information. 
  

	 	(i)	Employee acknowledges that in his employment with the Company, he will occupy a position of trust and confidence. Employee shall not, except as may be required to perform his duties
hereunder or as required by applicable law, without limitation in time or until such information shall have become public other than by Employee’s unauthorized disclosure, disclose to others or use, whether directly or indirectly, any
Confidential Information. 

  

	 	(ii)	Employee acknowledges that all Confidential Information is specialized, unique in nature and of great value to the Company and its parents, subsidiaries or affiliates, and that such
Confidential Information gives the Company and its parents, subsidiaries or affiliates a competitive advantage. Employee agrees to deliver or return to the Company, at the Company’s request at any time or upon termination or expiration of his
employment or as soon thereafter as possible, all documents, computer tapes and disks, records, lists, data, drawings, prints, notes and written information (and all copies thereof) furnished by or on behalf of or for the benefit of the Company and
its parents, subsidiaries or affiliates or prepared by Employee during the Term of this Agreement, but excluding documents relating to Employee own compensation and benefits. 

  
 (d) Non-Disparagement. Except as required by law,
Employee shall not make, participate in the making of, or encourage any other person to make, any statements, written or oral, that criticize, disparage or defame the goodwill or reputation of, or which are intended to embarrass or adversely affect
the morale of, the Company or any of its affiliates or any of their respective present, former or future directors, officers, executives, employees and/or shareholders. Except as required by law, Employee further agrees not to make any negative
statements, written or oral, relating to his employment, the termination of his employment, or any aspect of the business of the Company or any of its affiliates. The provisions of this Section 8(d) shall continue through the Term of this Agreement
and perpetually thereafter. 
  
 9. SEVERABILITY. It is the
desire and intent of the parties that the provisions of this Agreement shall be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular
provision or portion of this Agreement shall be adjudicated to be invalid or 

  

 9 

 
unenforceable, this Agreement shall be deemed amended to delete therefrom the portion thus adjudicated to be invalid or unenforceable, such deletion to apply
only with respect to the operation of such provision in the particular jurisdiction in which such adjudication is made. 
  
 10. SURVIVAL OF PROVISIONS. The obligations contained in Section 8 hereof shall, to the extent provided in Section 8 hereof, survive the
termination or expiration of Employee’s employment with the Company and, as applicable, shall be fully enforceable thereafter in accordance with the terms of this Agreement. If it is determined by a court of competent jurisdiction in any state
that any restriction in Section 8 hereof is excessive in duration or scope or is unreasonable or unenforceable under the laws of that state, it is the intention of the parties that such restriction may be modified or amended by the court to render
it enforceable to the maximum extent permitted by the law of that state. 
  
 11. NOTICES. All communications, requests, consents and other notices provided for in this Agreement shall be in writing and shall be deemed give if delivered by hand facsimile transmission or if mailed by
first class mail, postage prepaid, to the last known address or facsimile transmission number of the recipient. 
  
 12. GOVERNING LAW. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware without
giving effect to the conflicts of rules provisions thereof. 
  
 13. ASSIGNMENT. Neither this Agreement nor any rights or duties hereunder may be assigned by Employee or the Company without the prior written consent of the other, such consent not to be unreasonably withheld. 
  
 14. AMENDMENTS. No provisions of this Agreement shall be altered,
amended, revoked or waived except by an instrument in writing, signed by each party to this Agreement. 
  
 15. BINDING EFFECT. Except as otherwise provided herein, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto
and their respective legal representatives, heirs, successors and assigns. 
  
 16. EXECUTION IN COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

  
 17. ARBITRATION. Any dispute, controversy or question
arising under, out of, or relating to this Agreement (or the breach thereof), or Employee’s employment with the Company or termination thereof, shall be referred for arbitration in the City of Wilmington or the City of New York to a neutral
arbitrator selected by Employee and the Company, and this shall be the exclusive and sole means for resolving such dispute. 
  
 18. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement and understanding of the parties and supersedes all prior understandings,
agreements or representations by or between the parties, whether written or oral, which relate in any way to the subject matter hereof. 
  

 10 

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

  

			
		
	By:	 	 /s/ Randall E. Curran

	 	 	 Randall E. Curran

	
	ITC DELTACOM, INC.
		
	By:	 	 /s/ J. Thomas Mullis

	 Name: J. Thomas Mullis

	 Title: Senior Vice President–Legal and Regulatory

  

 11 

 EXHIBIT A 
  
 EBITDA BONUS TARGETS 
  
 If the EBITDA is for Fiscal Year Ending 12/31/05 
  

				
	 	  	Bonus % of Base Salary

	 
	 Below $60 million
	  	0	%
	 $60+ million - $70 million
	  	25	%
	 $70+ million - $75 million
	  	50	%
	 $75+ million - $80 million
	  	75	%
	 $80+ million
	  	100	%

  
 If the EBITDA is
for Fiscal Year Ending 12/31/06 
  

				
	 	  	Bonus % of Base Salary

	 
	 Below $75 million
	  	0	%
	 $75+ million - $80 million
	  	25	%
	 $80+ million - $85 million
	  	50	%
	 $85+ million - $95 million
	  	75	%
	 $95+ million
	  	100	%

  
 Notes: 
  

	 	•	 	If, for either Fiscal Year, EBITDA (as defined in Section 5(b)) minus capital expenditures (as reflected in the Company’s financial statements in accordance with generally
accepted accounting principles consistently applied) is less than 50% of EBITDA, the bonus percentage shown above for any amount of EBITDA shall be reduced by one level. 

  

	 	•	 	To achieve any target bonus level for the Fiscal Year ending December 31, 2006, EBITDA for such Fiscal Year must exceed EBITDA for the Fiscal Year ending December 31, 2005.

  

 12

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