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Exhibit 4
CHANGE IN CONTROL AGREEMENT
DATED JUNE 24, 1996,
BETWEEN THE COMPANY AND
XXXXXX X. XXXXXX
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CHANGE IN CONTROL AGREEMENT
This Agreement is made and entered into as of this 24th day of July,
1996 ("Effective Date") by and between WOODBURY TELEPHONE COMPANY (the
"Company"), 000 Xxxx Xxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000 and XXXXXX X.
XXXXXX (the "Employee"), 000 Xxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000.
W I T N E S S E T H:
WHEREAS, the Employee is currently employed as President and Chief
Executive Officer of the Company reporting directly to the Board of Directors of
the Company and with the duties and responsibilities commensurate with such
position; and
WHEREAS, the Employee desires to assure himself of continued employment
in the event of a Change in Control, as defined herein, and the Company wishes
to induce the Employee to continue his employment by the Company in the event of
a Change in Control; and
WHEREAS, this Agreement is not intended to alter the compensation and
benefits that the Executive would receive in the absence of such a Change in
Control.
NOW, THEREFORE, in consideration of the mutual agreements herein set
forth, the parties agree as follows:
1. AGREEMENT. This Agreement, although taking effect on the Effective
Date, will be operative only upon the occurrence of a Change in Control. Upon
such occurrence this Agreement shall become operative immediately. This
Agreement is not to be considered a contract of employment and shall in no way
change the nature of the Employee's present employment by the Company and the
Employee shall at all times prior to a Change in Control be considered an
employee at will.
2. CHANGE IN CONTROL. A "Change in Control" shall be deemed to occur:
(a) when the Company acquires actual knowledge that any "person"
(as such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934 (the "Exchange Act"), other
than an affiliate of the Company or an employee benefit plan
established or maintained by the Company is or becomes the
beneficial owner (as defined in Rule 13d-3 of the Exchange
Act), directly or indirectly, of
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securities of the Company representing more than ten percent (10%) of
the combined voting power of the Company's then outstanding securities
(a "Control Person", and for purposes of this Agreement, Southern New
England Telecommunications Corporation shall be deemed a "Control
Person") or, in the case of a person who at the Effective Date is a
"Control Person", when such Control Person increases its ownership of
the Company's then outstanding stock, or
(b) upon the first purchase of the Company's common stock pursuant to a
tender or exchange offer (other than a tender or exchange offer made by
the Company, or an employee benefit plan established or maintained by
the Company, or their respective affiliates), or upon the approval by
the Company's stockholders of: (A) a merger or consolidation of the
Company with or into another corporation (other than a merger or
consolidation the definitive agreement for which provides that at least
two-thirds of the directors of the surviving or resulting corporation
immediately after the transaction are Continuing Directors (as
hereinafter defined) (a "Non-Control Transaction")), (B) a sale or
disposition of all or substantially all of the Company's assets, or (C)
a plan of liquidation or dissolution of the Company, or
(c) if during any period of twenty-four (24) consecutive months,
individuals who at the beginning of such period constitute the Board of
Directors of the Company (the "Company Board") (the "Continuing
Directors") cease for any reason to constitute at least two-thirds
thereof or, following a Non- Control Transaction, two-thirds of the
board of directors of the surviving or resulting corporation; provided
that any individual whose election or nomination for election as a
member of the Company Board (or, following a Non-Control Transaction,
the board of directors of the surviving or resulting corporation) was
approved by a vote of at least two-thirds of the Continuing Directors
then in office shall be considered a Continuing Director, or
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(d) upon any filing by the Company or any other person with the
Connecticut Department of Public Utility Control or other
state regulatory agency pursuant to Conn. Gen. Stat. 16-43(1)
or other statute in connection with a plan to merge,
consolidate or exchange common stock with any other company or
sell, lease, assign, or otherwise dispose of all or
substantially all or any essential part of its franchise,
plant equipment or other property necessary and useful in the
performance of the Company's duty to the public.
3. FUNDAMENTAL CHANGE. "Fundamental Change" means the occurrence
within six (6) months prior to or twenty-four (24) months after a Change in
Control of any of the following events or conditions:
(a) A change in the Employee's status, title, position or
responsibilities (including reporting responsibilities);
(b) A reduction in the Employee's compensation and/or benefits;
(c) Relocation of the Employee's principal office to a location
outside a thirty (30) mile radius from the Company's offices
described in this Agreement; or
(d) Termination of the Employee's employment other than "for
cause" as defined in Paragraph 4 or as a result of the
Employee's death, disability or retirement.
4. TERMINATION FOR CAUSE. For the purposes of Paragraph 3 above,
termination of the Employee for any of the following reasons shall be considered
to be termination for cause:
(a) gross negligence or wilful misconduct, including material
dishonesty by the Employee in the performance of the
Employee's duties;
(b) material breach by the Employee of any terms of Employee's
employment by the Company and failure to correct such breach
within twenty (20) days after written notice by the Board of
Directors; or
(c) upon the Employee's failure or refusal to comply with lawful
directions or instructions by the Board of Directors.
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If the Employee is terminated for any of the foregoing reasons he shall
not be entitled to the benefits provided for in Paragraph 5.
5. BENEFITS UPON TERMINATION FOR A FUNDAMENTAL CHANGE
(a) The Employee may, if a Fundamental Change occurs, choose to
terminate his employment by the Company. Upon such termination
by the Employee for a Fundamental Change, the Employee shall
receive the lesser of (i) two hundred and twenty percent
(220%) of the annual compensation then being paid to the
Employee or (ii) two hundred ninety nine percent (299%) of the
average of the Employee's annual compensation for the
preceding five (5) years, provided that such termination
occurs within twelve (12) months following the Fundamental
Change.
(b) If the Fundamental Change which occurs is the Company's
termination of the Employee's employment other than "for
cause" as defined in Paragraph 4, then the Employee shall be
entitled to receive the lesser of (i) two hundred twenty
percent (220%) of the annual compensation then being paid to
the Employee or (ii) two hundred ninety nine percent (299%) of
the average of the Employee's annual compensation for the
preceding five (5) years. If such termination occurs within
six (6) months prior to a Change in Control, then such payment
shall be due and owing upon the occurrence of the Change in
Control. If such termination occurs within twenty- four (24)
months following a Change in Control, then such payment shall
be due and owing upon termination.
(c) The Employee shall have the option to receive any payment to
which he is entitled under subparagraphs (a) or (b) above as a
lump sum within five (5) days after such termination, or in
substantially equal monthly installments until full payment
has been made.
6. DEATH, DISABILITY AND RETIREMENT BENEFITS. If the Employee should
die or become eligible to receive benefits under a long term disability plan of
the Company or retire following a Change in Control at a time when this
Agreement is in effect, Employee's employment and the Company's obligations
under this Agreement shall terminate as of the end of the month in which his
death or eligibility to receive such disability payments or retirement occurs.
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7. MISCELLANEOUS.
(a) GOVERNING LAW. The validity, construction, interpretation and
enforceability of this Agreement, and the capacity of the
parties shall be determined and governed by the laws of the
State of Connecticut.
(b) SEVERABILITY. In the event any one or more the provisions
contained in this Agreement is held invalid in any respect,
such invalidity shall not effect the validity of the other
provisions of this Agreement, and such provision(s) is
modified to the extent necessary to make it (them)
enforceable.
(c) BINDING EFFECT. Provisions of this Agreement shall be binding
on and inure to the benefit of the Company and the Employee
and their respective heirs, administrators, executors,
successors and assigns.
(d) WAIVER. This Agreement contains the entire agreement between
the parties hereto with respect to the subject matter hereof.
This Agreement may be amended or modified only by a writing
signed by the party against whom enforcement of any waiver,
change, modification, extension or discharge is sought. No
delay or failure on the part of either party in exercising any
power or right shall operate as a waiver thereof nor shall any
single or partial exercise of any power or right preclude
other or further exercise thereof or the exercise of any other
power or right.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of this 24th day of July, 1996.
WOODBURY TELEPHONE COMPANY
By: /s/ J. Xxxxx Xxxxxxxx
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J. Xxxxx Xxxxxxxx
Its Chairman of the Board
EMPLOYEE
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
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