Exhibit 10.20
CHANGE OF CONTROL
AGREEMENT
This Change of Control Agreement (this “Agreement”) is
entered into as of the 29th day of November , 2007,
by and between HickoryTech Corporation, a Minnesota corporation
(the “Company”), and Damon D. Dutz (the
“Executive”).
WITNESSETH:
WHEREAS, the Executive will devote substantial skill and effort to
the affairs of the Company, and the Board of Directors of the
Company desires to recognize the significant personal contribution
that the Executive will make to further the best interests of the
Company; and
WHEREAS, it is desirable and in the best interests of the Company
and its stockholders to continue to obtain the benefits of the
Executive’s services and attention to the affairs of the
Company, and
WHEREAS, it is desirable and in the best interests of the Company
and its stockholders to provide inducement for the Executive
(1) to remain in the service of the Company in order to
facilitate an orderly transition in the event of a change in
control of the Company and (2) to remain in the service of the
Company in the event of any threatened or anticipated change in
control of the Company; and
WHEREAS, it is desirable and in the best interests of the Company
and its stockholders that the Executive be in a position to make
judgments and take actions with respect to a proposed change in
control of the Company without regard to the possibility that his
or her employment may be terminated without compensation in the
event of certain changes in control of the Company; and
WHEREAS, the Executive desires to be protected in the event of
certain changes in control of the Company; and
WHEREAS, for the reasons set forth above, the Company and the
Executive desire to enter into this Agreement.
NOW, THEREFORE, in consideration of the facts recited above and the
mutual covenants and agreements contained herein, the Company and
the Executive agree as follows:
1.
Right to
Payment . If
the Executive’s employment with the Company or its Successor
is terminated within three (3) years following an Event (as
defined in Paragraph 2 below) for any reason other than a reason
specified in Paragraph 3(a) through (d) below, then the
Executive shall be entitled to receive the Benefits set out in
Paragraph 4 below. If a subsequent Event occurs, and if the
Executive is an employee of the Company or its Successor, without
limiting any rights the Executive may have, Executive shall have
all rights provided by the first sentence of this Paragraph 1
relating to such subsequent event.
2.
Change of Control
Events . An
“Event” shall be deemed to have occurred if:
(a)
A majority of the
directors of the Company shall be persons other than
persons
(1)
for whose election proxies
shall have been solicited by the Board of Directors of the Company;
or
(2)
who are then serving as
directors and who were initially appointed or elected by the Board
of Directors to fill vacancies on the Board of Directors caused by
death or resignation (but not by removal), or to fill newly created
directorships created by the Board of Directors;
provided, however, that a person shall not be
deemed to be a director subject to clause (1) or (2), above,
if his or her initial assumption of office occurs as a result of an
actual or threatened election contest with respect to the
threatened election or removal of directors (or other actual or
threatened solicitation of proxies or consents) by or on behalf of
any person other than the Board of Directors of the Company;
or
1
(b)
30% or more of the
outstanding voting stock of the Company or all or substantially all
of the assets or stock of the Company is acquired or beneficially
owned (as defined in Rule 13d-3 under the Securities and
Exchange Act of 1934, as amended, or any successor
rule thereto), directly or indirectly, by any Person (other
than by the Company, a subsidiary of the Company, an employee
benefit plan (or related trust) sponsored or maintained by the
Company or one or more of its subsidiaries, or by the Employee or a
group of persons, including the Employee, acting in concert) or
group of Persons, acting in concert, whether by acquisition of
assets, merger, consolidation, statutory share exchange (other than
a merger, consolidation or statutory share exchange described in
clause (c)(i) or (ii), below), tender offer, exchange offer,
or otherwise;
(c)
The Company is merged into
or consolidated with another corporation (other than a subsidiary
of the Company) or a statutory share exchange for the
Company’s outstanding voting stock of any class is
consummated unless (i) a majority of the voting power of the
voting stock of the surviving corporation is, immediately following
the merger, consolidation or statutory share exchange, beneficially
owned, directly or indirectly, by the Employee (or a group of
Persons, including the Employee, acting in concert) or
(ii) immediately following the merger, consolidation or
statutory share exchange, more than 70% of the voting power of the
voting stock of the surviving corporation is beneficially owned,
directly or indirectly, by the persons who beneficially owned
voting stock of the Company immediately prior to such merger,
consolidation or statutory share exchange in substantially the same
proportion as their ownership of the voting stock of the Company
immediately prior to such merger, consolidation or statutory share
exchange; or
(d)
The shareholders of the
Company approve the complete liquidation or dissolution of the
Company.
3.
Termination Not
Entitling Executive to Benefits . The Executive shall not be entitled to the
Benefits set out in Paragraph 4 if his or her employment is
terminated during the three (3) year period following an Event
for any of the following reasons:
(a)
Death
. The Executive’s
death.
(b)
Disability
. The Executive’s
disability. “Disability” shall mean the inability of
the Executive to perform the duties and responsibilities of his or
her employment by reasons of illness or other physical or mental
impairment or condition, if such inability continues for an
uninterrupted period of ninety (90) calendar days or more. A period
of inability shall be “uninterrupted” unless and until
the Executive is no longer considered disabled by the
Company’s Long Term Disability Insurer.
(1)
The determination of
whether the Executive is suffering from a “disability”
as defined herein shall be made. The determination of whether the
Executive is disabled shall be on the same basis as the Company
provided Long-Term Disability benefit, which is a fully insured
benefit provided by an independent third party. If the Executive
meets the disability criteria for long term disability benefits
under this Company provided benefit, the Executive will also be
considered disabled under this Agreement.
(2)
The Executive agrees to
make himself or herself available for and to submit to examinations
by such physicians as may be requested by the Company or the
Company’s Long Term Disability Insurer. The Executive’s
failure to submit to examinations by such physicians as may be
requested shall disqualify Executive from receiving Benefits under
this Agreement.
(c)
Voluntary
Termination .
The Executive’s voluntary retirement or voluntary termination
of employment. However, the Executive’s retirement or
termination of employment shall not be considered voluntary if,
following the Event and subject to the provisions for notification
set forth below, one or more of the following has occurred without
Executive’s express written consent and results in a material
negative change to Executive:
(1)
There has been a failure
to provide the Executive with substantially equivalent reporting
responsibilities, titles, offices or positions, or Executive has
been removed from, or has not been re-elected to, any of such
positions, which has the effect of materially diminishing the
Executive’s responsibility or authority;
2
(2)
There has been a failure
to provide the Executive with: (a) the same base salary, or
(b) substantially equivalent (or greater) total salary
opportunity, or (c) employee benefits which are, in the
aggregate, substantially equivalent to those provided to the
Executive at the time of the Event;
(3)
There has been a failure
to provide the Executive with substantially equivalent office space
or administrative support; or
(4)
Executive has been
required to perform his or her services in a location that is more
than fifty (50) miles from the Executive’s regularly assigned
office location at the time of the Event, or Executive is required
to undertake substantially more job-related traveling.
In
the event of an occurrence of the type enumerated in subparagraphs
(1) through (4) above, Executive shall, within ten
(10) days following Executive’s actual knowledge of such
occurrence, notify the Company in writing of the specific
occurrence which Executive believes would render his/her retirement
or termination not voluntary and, following receipt of such notice,
the Company shall
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