Exhibit 10.1
AMENDED AND RESTATED EMPLOYMENT
AGREEMENT
Amended and Restated Employment Agreement, dated
as of April 27, 2009 (this “ Agreement ”), by
and between OTELCO INC., a Delaware corporation (“
Otelco ” or the “ Company ”), and
ROBERT SOUZA (the “ Employee ”).
WHEREAS, the Employee and Pine Tree Holdings,
Inc., a Delaware corporation and a wholly-owned subsidiary of the
Company, have entered into that certain Employee Agreement, dated
as of July 30, 2002, as amended on October 31, 2008 and December
31, 2008 (as amended, the “ Prior Agreement
”).
WHEREAS, the Company and the Employee desire to
amend and restate the terms of the Prior Agreement.
NOW THEREFORE, in consideration of the mutual
covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1.
Effective Date .
This Agreement shall become effective on the
date first written above (the “ Effective Date
”).
SECTION 2.
Employment Period .
Subject to Section 4 , the Company hereby
agrees to employ the Employee, and the Employee hereby agrees to be
employed by the Company, in accordance with the terms and
provisions of this Agreement, for the period from the Effective
Date through the Termination Date (the “ Employment
Period ”).
SECTION 3.
Terms of Employment .
(a) Duties
and Position . During the Employment Period, the Employee shall
serve as the Company’s Vice President of Operations, New
England Division. As such, the Employee shall have duties and
responsibilities commensurate with such position and such other
duties and responsibilities as may from time to time be assigned to
or vested in the Employee by the Company’s board of directors
(the “ Board ”), the Company’s Chief
Executive Officer or the Company’s Senior Vice President, New
England Division.
(b) Full
Time . During the Employment Period, and excluding any periods
of vacation and sick leave to which the Employee is entitled, the
Employee agrees to devote his full business time and efforts, to
the best of his ability, experience and talent, to the business and
affairs of the Company. During the Employment Period, it shall not
be a violation of this Agreement for the Employee to serve on
corporate, civic or charitable boards or committees or manage
personal investments (including serving as a member of boards of
directors or similar bodies of entities not engaged in competition
with Otelco or its subsidiaries (collectively, the “
Company Entities ”) (as determined by the Board in its
reasonable discretion)), in each case, so long as such activities
do not interfere with the performance of the Employee’s
responsibilities as an employee of the Company in accordance with
this Agreement.
(i)
Base Salary . During the Employment Period, the Employee
shall receive an annual base salary of $165,000 which annual base
salary shall be subject to annual increase by an amount equal to at
least the increase in the cost of living, if any, between the date
of the immediately preceding increase and the date of each such
adjustment, based upon the Consumer Price Index for Urban
Consumers, or if that index is discontinued, a similar index
prepared by a department or agency of the United States government
(as so adjusted, the “ Annual Base Salary ”).
The Annual Base Salary shall be paid in accordance with the
customary payroll practices of the Company, subject to withholding
and other payroll taxes.
(ii)
Bonus . For each fiscal year during the Employment Period,
the Employee shall be entitled to receive a bonus (the “
Bonus ”) of up to 25% of the Annual Base
Salary.
(iii)
Special Bonus . The Employee shall be entitled to
receive the Special Bonus on or about December 31, 2012 (the
“ Special Bonus Date ”).
(iv)
Benefits . During the Employment Period, the Employee shall
be entitled to participate in all incentive (including any long
term incentive plan), savings and retirement plans, practices,
policies and programs applicable generally to other employees of
the Company and shall be eligible for participation in and shall
receive all benefits under welfare benefit plans, practices,
policies and programs provided by the Company to the extent
applicable generally to other employees of the Company.
(v)
Automobile . During the Employment Period, the
Company shall provide the Employee with the use of a Company
automobile (or, at the Company’s option, shall lease an
automobile for the Employee’s use) and shall reimburse the
Employee for all reasonable expenses incurred by the Employee in
connection with the use and maintenance of such
automobile.
(vi)
Expenses . The Employee shall be entitled to receive
reimbursement for all reasonable expenses incurred by the Employee
during the Employment Period in connection with the performance of
his duties hereunder, in accordance with the policies, practices
and procedures of the Company as in effect from time to
time.
(vii)
Vacation and Holidays . During the Employment Period, the
Employee shall be entitled to paid holidays and vacation in
accordance with the policies of the Company generally applicable to
other employees of the Company generally.
SECTION 4.
Termination of Employment .
(a) Death or
Disability . The Employee’s employment shall terminate
automatically upon the Employee’s death or Disability. For
purposes of this Agreement, “ Disability ” shall
mean the Employee’s inability to perform his duties and
obligations hereunder for any 90 days during a period of 180
consecutive days due to mental or physical incapacity as determined
by a physician selected by the Company or its insurers.
(b)
Termination by the Employee . The Employee may terminate his
employment with the Company at any time, without prior
notice.
(c)
Termination by the Company . The Company may terminate the
Employee’s employment with the Company at any time, with or
without Cause and without prior notice. “ Cause
” will mean that any of the following will have occurred (i)
the Employee has been convicted of a felony, stolen funds or
otherwise engaged in fraudulent conduct, (ii) the Employee has
engaged in willful misconduct or has been grossly negligent, in
each case, which has been materially injurious to the Company,
(iii) the Employee has failed or refused to comply with directions
of the Board that are reasonably consistent with the
Employee’s current position or (iv) the Employee has breached
the terms of this Agreement. “ Without Cause ”
shall mean a termination by the Company of the Employee’s
employment during the Employment Period for any reason other than a
termination based upon Cause, death or Disability.
SECTION 5.
Obligations of the Company upon Termination .
(a) Without
Cause . If, during the Employment Period, the Company shall
terminate the Employee’s employment Without Cause, then the
Company will provide the Employee with the following severance
payments and/or benefits:
(i) The
Company shall pay to the Employee a lump sum in the amount of the
Employee’s accrued but unpaid Annual Base Salary through the
Termination Date (“ Accrued Obligations
”);
(ii) The
Employee and, if applicable, members of his family shall be
entitled to continue their participation in the Company’s
welfare and benefit plans (the “ Benefits ”)
through the Termination Date;
(iii) The
Company shall pay to the Employee a lump sum in the amount of
one-half (1/2) of his Annual Base Salary within six (6) months
following termination but not later than March 14 of the calendar
year following termination;
(iv) The
Company shall pay to the Employee the Special Bonus on the Special
Bonus Date; and
(v) The
Company shall pay to the Employee a lump sum amount equal to the
Bonus the Employee would have received had he remained employed by
the Company through the end of the fiscal year in which the
termination occurred, pro rated for the number of days the Employee
was employed by the Company during such fiscal year, to be paid at
the same time that similar bonuses are paid to the Company’s
other employees.
(b) Cause;
by the Employee; Death or Disability . If the Employee’s
employment shall be terminated by the Company for Cause, by the
Employee for any reason, or due to death or Disability, then the
Company shall have no further payment obligations to the Employee
(or his heirs or legal representatives) other than for (i) payment
of Accrued Obligations and (ii) the continuance of Benefits through
the Termination Date.
(c)
Condition; Release . The Employee acknowledges and agrees
that the Company’s obligations to make payments under
Section 5(a) will be conditioned on the Employee executing
and delivering a customary general release in form and substance
reasonably satisfactory to the Company.
SECTION 6.
Nondisclosure and Nonuse of Confidential Information
.
(a) The Employee
shall not disclose or use at any time, either during the Employment
Period or thereafter, any Confidential Information (as hereinafter
defined) of which the Employee is or becomes aware as a consequence
of or in connection with his employment with the Company, whether
or not such information is developed by him, except (i) to the
extent that such disclosure or use is in furtherance of the
Employee’s performance in good faith of his duties as the
Company’s Vice President of Operations, New England Division
or (ii) to the extent required by law or legal process;
provided that (A) the Employee agrees to provide the Company
with prompt written notice of any such law or legal process and to
assist the Company, at the Company’s expense, in asserting
any legal challenges to or appeals of such law or legal process
that the Company in its sole discretion pursues, and (B) in
complying with any such law or legal process, the Employee shall
limit his disclosure only to the Confidential Information that is
expressly required to be disclosed by such law or legal process.
The Employee will take all commercially reasonable steps to
safeguard Confidential Information and to protect it against
disclosure, misuse, espionage, loss and theft. The Employee shall
deliver to the Company on the Termination Date, or at any time the
Company may request, all memoranda, notes, plans, records, reports,
computer tapes and software and other documents and data (and
copies thereof) relating to the Confidential Information or the
Work Product (as hereinafter defined) of the Company Entities which
the Employee may then possess or have under his control.
(b) The
Employee agrees that all Work Product belongs in all instances to
the Company Entities. The Employee will promptly disclose such Work
Product to the Board and perform all actions reasonably requested
by the Board (whether during or after the Employment Period) to
establish and confirm the Company Entities’ ownership of the
Work Product (including, without limitation, the execution
a
