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EXHIBIT 10.19
INTERVOICE, INC.
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is dated as of October 8, 1997,
between InterVoice, Inc., a Texas corporation with its principal executive
offices at 00000 Xxxxxxxxx Xxxxxxx Xxxxxx, Xxxxx 00000 (the "Company"), and
Xxxx X. Xxxxx (the "Employee").
W I T N E S S E T H:
WHEREAS, the Employee and the Company desire to enter into this Agreement
to provide for certain terms and conditions of Employee's employment by the
Company.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and subject to the
terms and conditions hereinafter set forth, the parties hereto agree as follows:
1. DEFINITIONS.
In addition to the words and terms elsewhere defined in this Agreement,
the following words and terms as used herein shall have the following meanings,
unless the context or use indicates a different meaning:
"Cause" means (a) any act by the Employee that is materially adverse to
the best interests of the Company and which, if the subject of a criminal
proceeding, could result in a criminal conviction for a felony or (b) the
willful failure by the Employee to substantially perform his duties hereunder,
which duties are within the control of the Employees (other than the failure
resulting from the Employee's incapacity due to physical or mental illness),
provided, however, that the Employee shall not be deemed to be terminated for
Cause under this subsection (b) unless and until (1) after the Employee
receives written notice from the Company specifying with reasonable
particularity the actions of Employee which constitute a violation of this
subsection (b) and (2) within a period of 30 days after receipt of such notice
(and during which the violation is within the control of the Employee),
Employee fails to reasonably and prospectively cure such violation.
"Common Stock" means the Company's common stock, no par value per share.
An "Event of Default" means the occurrence of any of the following events,
unless remedied or otherwise cured within 30 days after the Company's receipt
of written notice from the Employee of such event, (a) a breach by the Company
of any of its express or implied
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obligations under this Agreement, (b) without his prior concurrence, the
Employee is assigned any duties or responsibilities that are inconsistent with
his position, duties, responsibilities or status at the commencement of the
term of this Agreement, or (c) the Employee's base compensation is reduced or
any other failure by the Company to comply with Section 4.
2. EMPLOYMENT.
The Company hereby employs the Employee and the Employee hereby accepts
employment on the terms and conditions set forth herein.
3. TERM.
The term of this Agreement shall be from October 8, 1997 until October 8,
1999 unless sooner terminated in accordance with the provisions herein
regarding termination.
4. COMPENSATION.
(a) Base Salary. For all services rendered by the Employee under this
Agreement, the Company shall pay the Employee a base salary of $125,000 per
year. Such salary shall be payable in equal month installments in accordance
with the customary payroll policies of the Company in effect at the time such
payment is made. On or about the anniversary date of this Agreement each year
during the term hereof, the Compensation Committee of the Company shall review
Employee's performance for the prior year and may make such adjustments in base
salary from time to time at their discretion as the Employee and the Company
may agree.
(b) Annual Bonus. Effective for the Company's fiscal year ending February
28, 1998 and continuing with respect to each subsequent fiscal year thereafter
during the term of this Agreement, the Company will pay Employee incentive
compensation based on the Employee's then current Sales Incentive Plan for the
fiscal year, as provided to the Employee by the Company. The Employee's Sales
Incentive Plan for the Company's fiscal year ending February 28, 1998 is
attached as Schedule A, and is incorporated into this Agreement by this
reference.
(c) Benefits. The Employee shall be entitled to participate in or receive
benefits under any employee benefit plan or arrangement made available by the
Company in the future to its similarly situated officers and key management
personnel, subject to and on a basis consistent with the terms, conditions and
overall administration of such plan or arrangement. Nothing paid to the
Employee under any plan or arrangement presently in effect or made available in
the future shall be deemed to be in lieu of the salary and bonuses payable to
the Employee pursuant to Subsections 4(a) and (b). In addition, the Company
currently has a director and officer insurance policy which provides insurance
for the Company's directors and officers in accordance with its terms.
(d) Stock Option. In consideration of the Employee's execution of this
Agreement, the Company will recommend that the Compensation Committee of its
Board of Directors grant
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an option to purchase 30,000 shares of the Company's Common Stock to the
Employee pursuant to the Company's 1990 Incentive Stock Option Plan. The
exercise price for such option will be the closing price for the Company's
Common Stock on the Nasdaq National Market on the date of grant, and the option
will become exercisable in four equal amounts on the first four annual
anniversaries of the date of grant.
(e) Expenses. Upon receipt of itemized vouchers, expense account reports,
and supporting documents submitted to the Company in accordance with the
Company's procedures from time to time in effect, the Company shall reimburse
employee for all reasonable and necessary travel, entertainment, and other
reasonable and necessary business expenses incurred ordinarily and necessarily
by Employee in connection with the performance of his duties hereunder.
(f) Vacation. Employee shall be entitled to a minimum of three (3) weeks'
paid vacation during each twelve month period commencing on the effective date
of this Agreement.
5. POSITION, DUTIES, EXTENT OF SERVICES AND SITUS.
(a) Position and Duties. Employee shall serve as the Vice President of
Telco Sales and report directly to the Senior Vice President, Sales and,
subject to such authority, shall have supervision and control over, and
responsibility for, the general management and operation of the
Telecommunication Sales Department and shall have such other powers and duties
as may from time to time be prescribed by such authority, provided that such
duties are reasonable and customary for a Vice President of Telco Sales. it is
currently contemplated that Employee's reporting relationship (but not his title
of responsibilities) will change such that Employee will report directly to the
President of the Company commencing on or about December 30, 1997.
(b) Extent of Services. The Employee shall devote substantially all of
his business time, attention, and energy to the business and affairs of the
Company and shall not during the term of his employment under this Agreement
engage in any other business activity which could constitute a conflict of
interest, whether or not such business activity is pursued for gain, profit, or
other pecuniary advantage. This shall not be construed as preventing the
Employee from managing his current investments or investing his assets in such
form or manner as will not require any services on the part of the Employee in
the operation and the affairs of the companies in which such investments are
made, subject to the provisions of Sections 6 and 27.
6. COVENANT NOT TO COMPETE.
(a) The Employee acknowledges that (i) as a result of his position and
tenure with the Company he has received and will continue to receive
specialized and unique training and knowledge concerning the Company, its
business, its customers and the industry in which it competes, (ii) the
company's business, in large part, depends upon its exclusive possession and
use of the Proprietary Information (as defined in Section 27), (iii) the
Company is entitled to
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protection against the unauthorized disclosure or use by Employee of the
Proprietary Information or the training and knowledge received by the Employee
and (iv) he has received in this Agreement good and valuable consideration for
the covenants he is making in this Section 6 and in Section 27. The Company and
the Employee acknowledge and agree that the covenants contained in this Section
6 and in Section 27 are reasonably necessary for the protection of the Company
and are reasonably limited with respect to the activities they prohibit, their
duration, their geographical scope and their effects on the Employee and the
public. The parties acknowledge that the purpose and effect of the covenants
are to protect the Company from unfair competition by the Employee.
(b) Except as provided in the last sentence of this Section 6(b), during
the period in which the Employee renders services to the Company under this
Agreement and for eighteen (18) months thereafter, the Employee shall not,
without the written consent of the Company, own, manage, operate, control,
serve as an officer, director, employee, partner or consultant of or be
connected in any way with or have any interest in any corporation, partnership,
proprietorship or other entity which carries on business activities in the call
automation and/or voice automation industry or industries in any state of the
United States or any foreign country in which the Company has sold or installed
its products or systems or has definitive plans to sell or install its products
at any time prior to at the time of the date of termination of the Employee's
employment; except that the Employee may own up to 1% of the shares of any
publicly-owned corporation, provided that none of his other relationships with
such corporation violates such covenant. Notwithstanding the foregoing, the
provision of this Section 6 shall not apply if the Employee's employment with
the Company under this Agreement is terminated (i) by the Company, unless the
Employee is terminated in accordance with Section 7 or for Cause in accordance
with Subsection 9(a), or (ii) at the election of the Employee after the
occurrence of an Event of Default which has not been waived in writing.
(c) The Company and the Employee hereby agree that in the event that the
noncompetition covenants contained herein should be held by any court or other
constituted legal authority of competent jurisdiction to be effective in
any particular area or jurisdiction only if said covenants are modified to
limit their duration, geographical area or scope, then the parties hereto will
consider Section 6 to be amended and modified with respect to that particular
area or jurisdiction so as to comply with the order of any such court or other
constituted legal authority and, as to all other jurisdictions or political
subdivisions thereof, the noncompetiton covenants contained herein will
remain in full force and effect as originally written. The Company and the
Employee further agree that in the event that the noncompetition covenants
contained herein should be held by any court or other constituted legal
authority of competent jurisdiction to be void or otherwise unenforceable in any
particular area or jurisdiction notwithstanding the operation of this Section
6(c), then the parties hereto will consider this Section 6 to be amended and
modified so as to eliminate therefrom that particular area or jurisdiction as
to which such noncompetition covenants are so held void or otherwise
unenforceable, and, as to all other areas and jurisdictions covered by the
noncompetition covenants, the terms and provisions hereof shall remain in full
force and effect as originally written.
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(d) Employee recognizes and acknowledges that the Company would suffer
irreparable harm and substantial loss if Employee violated any of the terms and
provisions of this Section 6 or Section 27 and that the actual damages which
might be sustained by the Company as the result of any breach of this Section 6
or Section 27 would be difficult to ascertain. Employee agrees, at the election
of the Company and in addition to, and not in lieu of, the Company's right to
terminate Employee's employment and to seek all other remedies and damages which
the Company may have at law and/or equity for such breach, that the Company
shall be entitled to an injunction restraining Employee from breaching any of
the terms or provisions of this Section 6 or Section 27.
7. COMPENSATION IN THE EVENT OF DISABILITY.
(a) Disability. If the Employee becomes disabled during the term of this
Agreement the Company shall cause to be paid to the Employee an amount equal to
his base salary in effect at the time of disability under Subsection 4(a), for
the shorter of the duration of the disability or the remainder of the term of
this Agreement and, subject to the provisions of Section 22, with no liability
on its part for further payments to the Employee during the duration of the
disability. Subject to Subsection 7(b) below, full compensation shall be
reinstituted upon his return to employment and resumption of his duties. For
purposes of this Subsection 7(a) the Employee shall be deemed "disabled" when he
is unable, for a period of 90 consecutive days, to perform his normal duties of
employment due to bodily injury or disease or any other physical or mental
disability.
(b) Complete Disability. The Company shall have the right to terminate the
Employee's employment under this Agreement prior to the expiration of the term
upon the "Complete Disability" of the Employee as hereinafter defined (provided,
however, that the obligations of the Company under Subsection 7(a) shall not
terminate). The term "Complete Disability" as used in this Subsection 7(b) shall
mean (i) the total inability of the Employee, due to bodily injury or disease or
any other physical or mental incapacity, to perform the services provided for
hereunder for a period of 120 days, in the aggregate, within any given period of
180 consecutive days during the term of this Agreement, and (ii) where such
inability will, in the opinion of a qualified physician (reasonably acceptable
to Employee), be permanent and continuous during the remainder of his life.
8. COMPENSATION IN THE EVENT OF DEATH.
If the Employee dies during the term of his employment, the Company shall
pay to such person as the Employee shall designate in a notice filed with the
Company or, if no such person shall be designated, to his estate as a death
benefit, his base salary in effect at the time of his death pursuant to
Subsection 4(a), in equal semi-monthly installments on the first and fifteenth
day of each month immediately succeeding his death, for a period of months (not
exceeding 12) determined by multiplying the number of complete 12-month periods
of employment of the Employee by the Company (whether pursuant to an employment
agreement or not) by two, in addition to any payments the Employee's spouse,
beneficiaries, or estate may be entitled to
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receive pursuant to any pension or employee benefit plan or life insurance
policy maintained by the Company, and, except for any obligations of the Company
under Section 22, all other obligations of the Company hereunder shall cease at
the time of the Employee's death.
9. TERMINATION.
(a) Upon at least 30 days' prior written notice to the Employee, the
Company may terminate the Employee's employment with the Company under this
Agreement only for Cause or in accordance with Section 7 and, subject to the
provisions of Sections 7 and 22, with no liability on its part for further
payments to the Employee. The Company may effect a termination for Cause
pursuant to this Subsection 9 (a) only by the affirmative vote of a majority of
the members of the Board of Directors of the Company. In voting upon such
termination for Cause, if the Employee is also a member of the Board of
Directors of the Company (it is not currently contemplated that Employee will
be elected to the Board of Directors), then he may not vote on, and will not be
considered present for any purpose with respect to, a matter presented to the
Board of Directors of the Company pursuant to this Subsection 9 (a).
(b) The Employee may terminate his employment with the Company under this
Agreement by giving at least 90 days' prior written notice of his desire to
terminate employment to the Board of Directors of the Company. If the
Employee's employment with the Company under this Agreement is terminated
pursuant to this Subsection 9 (b), the Employee will continue to accrue and
receive his base salary in effect at the time pursuant to Subsection 4(a)
through the date of termination with no liability on the part of the Company
for further payments to the Employee, subject to the provisions of Section 22.
(c) If the Employee's employment with the Company is terminated by the
Company without Cause or if the Employee terminates his employment with the
Company following the occurrence of an Event of Default which has not been
waived in writing by the Employee, the Employee will continue to accrue and
receive his base salary in effect at the time pursuant to Subsection 4(a)
through the date of termination and will be entitled to receive the benefits
provided for under Section 10 (unless the Employee's employment is terminated in
accordance with Section 7) with no liability on the part of the Company for
further payments to the Employee, subject to the provisions of Sections 7 and
22.
10. COMPENSATION AFTER CERTAIN TERMINATIONS.
If the Employee's employment with the Company is terminated (whether such
termination is by the Employee or by the Company) at any time during the term
of this Agreement for any reason other than (a) termination by the Company for
Cause in accordance with Subsection 9 (a); (b) termination by the Company in
accordance with Section 7; (c) the Employee's death; or (d) termination at the
election of the Employee pursuant to Subsection 9 (b) then, within five days
after the date of such termination, (i) the Remaining Base Compensation (as
herein defined) which would have been paid to the Employee during the remainder
of the term of this Agreement if termination had not occurred shall become due
and payable and shall be paid to the Employee
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in a single lump sum in cash, and (ii) all stock options granted to Employee
pursuant to Subsection 4(d) hereof which are not then exercisable shall,
notwithstanding the provisions of any other agreement, become immediately
exercisable and shall remain exercisable until they are exercised or until they
otherwise would expire. For purposes of this Section 10, the "Remaining Base
Compensation" shall mean the annual base salary payable to the Employee
pursuant to Subsection 4(a) at the time of termination. In addition, if
Employee's employment is terminated prior to receiving the full amount of his
"Guaranteed Incentive Compensation" (as such term is defined in Schedule A),
the remaining unpaid amount of the Guaranteed Incentive Compensation shall also
be included in the Remaining Base Compensation.
11. MITIGATION.
The Employee shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise, nor
shall the amount of any payment provided for in this Agreement be reduced by
any compensation earned by the Employee as the result of employment by another
employer after the date of termination of Employee's employment with the
Company, or otherwise.
12. ENTIRE AGREEMENT.
This Agreement embodies the entire agreement and understanding between the
parties hereto with respect to the subject matter hereof and supersedes all
prior negotiations, agreements, and understandings relating to such subject
matter, and may be modified or amended only by an instrument in writing signed
by the parties hereto.
13. LAW TO GOVERN.
This Agreement is executed and delivered in the State of Texas and shall
be governed, construed and enforced in accordance with the laws of the State of
Texas.
14. ASSIGNMENT.
This Agreement is personal to the parties, and neither this Agreement nor
any interest herein my be assigned (other than by will or by the laws of descent
and distribution) without the prior written consent of the parties hereto nor
be subject to alienation, anticipation, sale, pledge, encumbrance, execution,
levy, or other legal process of any kind against the Employee or any of his
beneficiaries or any other person. Notwithstanding the foregoing, the Company
shall be permitted to assign this Agreement to any corporation or other
business entity succeeding to substantially all of the business and assets of
the Company by merger, consolidation, sale of assets, or otherwise, if the
Company obtains the assumption of this Agreement by such successor. Failure by
the Company to obtain such assumption prior to the effectiveness of such
succession shall be a breach of this Agreement and shall entitle the Employee
to receive compensation from the Company under this Agreement in the same
amount and on the same terms as he would be entitled to hereunder if his
employment had been terminated without Cause,
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and, for purposes of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the date of termination.
15. BINDING AGREEMENT.
Subject to the provisions of Section 14 of this Agreement, this Agreement
shall be binding and shall inure to the benefit of the Company and the Employee
and their respective representatives, successors, and assigns.
16. REFERENCES AND GENDER.
All references to "Sections" and "Subsections" contained herein are,
unless specifically indicated otherwise, references to sections and subsections
of this Agreement. Whenever herein the singular number is used, the same shall
include the plural where appropriate, and words of either gender shall include
the other gender where appropriate.
17. WAIVER.
No waiver of any right under this Agreement shall be deemed effective
unless the same is set forth in writing and signed by the party giving such
waiver, and no waiver of any right shall be deemed to be a waiver of any such
right in the future.
18. NOTICES.
Except as may be otherwise specifically provided in this Agreement, all
notices required or permitted hereunder shall be in writing and will be deemed
to be delivered when deposited in the United States mail, postage prepaid,
registered or certified mail, return receipt requested, addressed to the party
or parties at 00000 Xxxxxxxxx Xxxxxxx, Xxxxxx, Xxxxx 00000, or at such other
addresses as may have theretofore been specified by written notice delivered in
accordance herewith.
19. OTHER INSTRUMENTS.
The parties hereto covenant and agree that they will execute such other and
further instruments and documents as are or may become necessary or convenient
to effectuate and carry out the terms of this Agreement.
20. HEADINGS.
The headings used in this Agreement are used for reference purposes only
and do not constitute substantive matter to be considered in construing the
terms of this Agreement.
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21. INVALID PROVISION.
Any clause, sentence, provision, section, subsection, or paragraph of this
Agreement held by a court of competent jurisdiction to be invalid, illegal, or
ineffective shall not impair, invalidate, or nullify the remainder of this
Agreement, but the effect thereof shall be confined to the clause, sentence,
provision, section, subsection, or paragraph so held to be invalid, illegal or
ineffective.
22. RIGHTS UNDER PLANS AND PROGRAMS.
Anything in this Agreement to the contrary notwithstanding, no provision
of this Agreement is intended, nor shall it be construed, to reduce or in any
way restrict any benefit to which the Employee may be entitled under any other
agreement, plan, arrangement, or program providing benefits for the Employee.
23. MULTIPLE COPIES.
This Agreement may be executed simultaneously in one or more
counterparts, each of which shall be deemed an original and all of which shall
together constitute one and the same instrument. The terms of this Agreement
shall become binding upon each party from and after the time that he or it
executed a copy hereof. In like manner, from and after the time that any party
executes a consent or other document, such consent or other document shall be
binding upon such parties.
24. WITHHOLDING OF TAXES.
The Company may withhold from any amounts payable under this Agreement all
federal, state, city, or other taxes as shall be required pursuant to any law
or government regulation or ruling.
25. ENFORCEABILITY.
Each party to this Agreement acknowledges and represents that such party
has all requisite rights, power and authority to enter into this Agreement, and
that this Agreement, the terms and conditions of this Agreement, and the
transactions and obligations contemplated by this Agreement, will not result in
a breach of any agreement the party has with any third party.
26. SET OFF OR COUNTERCLAIM.
Except with respect to any claim against or debt or other obligation of
the Employee properly recorded on the books and records of the Company, there
shall be no right of set off or counterclaim against, or delay in, any payment
by the Company to the Employee or his beneficiaries provided for in this
Agreement in respect of any claim against or debt or other obligation of the
Employee, whether arising hereunder or otherwise.
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27. ASSIGNMENT, PROTECTION AND CONFIDENTIALITY OF PROPRIETARY INFORMATION.
Employee acknowledges and agrees that all items of the Company's
Proprietary Information constitute valuable, special and unique assets and trade
secrets of its business, which provide to the Company a competitive advantage
over others who do not have access thereto and access to which is essential to
the performance of Employee's duties hereunder. Employee shall not, during the
term of this Agreement or thereafter, use or disclose any Proprietary
Information that is not otherwise publicly available, in whole or in part, for
his benefit or for the benefit of any other person or party, except for the
Company. As used herein, "Proprietary Information" includes, but is not limited
to, customer lists and prices, whether current or prospective, product designs
or other product information, experimental developments and other research and
development information, testing processes, marketing studies and research
activities, and any other trade secrets concerning the Company, its
shareholders, officers, directors, employees, business prospects, customers,
transactions, finances, affairs, opportunities, operations, properties or
assets. The Employee further agrees that all inventions, devices, compounds,
processes, formulas, techniques, improvements and modifications which he may
develop, in whole or in part, during the term of his employment or through or
with the facilities, equipment or resources of the Company shall be and remain
the sole and exclusive property of the Company. The Employee agrees to deliver
to the Company at any time the Company may request, all memoranda, notes,
plans, records, reports, and other documents (including copies thereof and all
embodiments thereof whether in computerized form or any other medium) relating
to the business or affairs of the Company or its subsidiaries which he may then
possess or have under his control. Employee shall maintain in good condition
all tangible and other forms of Proprietary Information in Employee's custody
or control until his obligations under the preceding sentence are satisfied.
Employee agrees to execute all documents and take such other actions as may be
required to comply with this Section.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first above written.
INTERVOICE, INC.
By: /s/ XXXXXXX X. XXXXXX
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Name: XXXXXXX X. XXXXXX
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Title: President COO
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/s/ XXXX X. XXXXX
--------------------------------
XXXX X. XXXXX
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