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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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Form 10-K
(Mark one)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 1999 or
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 0-18391
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ASPECT COMMUNICATIONS CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
California 94-2974062
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
</TABLE>
1310 Ridder Park Drive, San Jose, California 95131-2312
(Address of principal executive offices and zip code)
(408) 325-2200
(Registrant's telephone number)
Securities registered pursuant to Section 12(b) of the Act:
NONE
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.01 par value
(Title of class)
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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [_]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
The aggregate market value of the voting stock held by non-affiliates of
the Registrant as of March 24, 2000, was $1,821,135,587 based upon the last
sale price reported for such date on the Nasdaq Stock Market. For purposes of
this disclosure, shares of Common Stock held by persons known to the
Registrant (based on information provided by such persons and/or the most
recent schedule 13G's filed by such persons) to beneficially own more than 5%
of the Registrant's Common Stock and shares held by officers and directors of
the Registrant have been excluded because such persons may be deemed to be
affiliates. This determination is not necessarily a conclusive determination
for other purposes.
The number of shares of the Registrant's Common Stock outstanding as of
March 24, 2000 was 51,112,728.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the 2000 Proxy Statement for the Annual Meeting of Shareholders
of Aspect Communications Corporation (Proxy Statement) scheduled to be held on
May 4, 2000, are incorporated by reference in Parts I, II, III, and IV of the
Report on Form 10-K.
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Forward-Looking Statements
Except for historical information contained herein, the matters discussed
in this report are forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended; Section 21E of the Securities
and Exchange Act of 1934, as amended; and the Private Securities Litigation
Reform Act of 1995; and are made under the safe-harbor provisions thereof.
Such forward-looking statements are subject to certain risks and uncertainties
that could cause actual results to differ materially from those projected in
these forward-looking statements. Factors that might cause such a difference
include, but are not limited to, those discussed in the section entitled
"Management's Discussion and Analysis of Financial Condition and Results of
Operations-- Business Environment and Risk Factors" in the 1999 Annual
Financial Report to Shareholders, an appendix to the 2000 Proxy Statement,
which is incorporated by reference in this Annual Report on Form 10-K. Readers
are cautioned not to place undue reliance on these forward-looking statements,
which reflect management's analysis only as of the date hereof. The Company
undertakes no obligation to publicly release the results of any revision to
these forward-looking statements.
PART I
Item 1. Business
Aspect Communications Corporation (Aspect or the Company) is the leading
provider of customer relationship portals that enable businesses to ensure
consistent interactions with their customers. Aspect's leadership position in
electronic customer relationship management (eCRM) solutions is based on its
14-year-history and more than 7,300 customer implementations around the world.
Aspect Communications was incorporated in California on August 16, 1985, and
is headquartered in San Jose, California, with offices in major cities
worldwide.
On February 18, 2000, the Company acquired privately held PakNetX
Corporation (PakNetX), an eBusiness software provider based in Salem, New
Hampshire. The transaction is anticipated to enable Aspect to integrate
multimedia-over-IP technology into its flagship customer relationship portal
software and strengthen the Company's eCRM market position. The transaction
will be accounted for as a purchase and will result in a one-time charge of
approximately $5 million related to in-process technology in the quarter ended
March 31, 2000. The Company agreed to pay approximately $55 million in cash
for all of the outstanding common and preferred shares and warrants of
PakNetX, which includes $10 million in payments contingent on the achievement
of certain milestones. In addition, Aspect assumed the existing PakNetX stock
option plan and converted PakNetX stock options into Aspect stock options. The
historical operations of PakNetX are not material to the financial position or
results of operations of the Company.
In September 1999, the Company changed its name from Aspect
Telecommunications Corporation to Aspect Communications Corporation to reflect
the transformation of its business from a telecommunications equipment
supplier to a provider of customer relationship portals.
In August 1998, the Company completed a private placement of approximately
$150 million ($490 million principal amount at maturity) of zero coupon
convertible subordinated debentures due 2018. The debentures are priced at a
yield to maturity of 6% per annum and are convertible into Aspect common stock
anytime prior to maturity at a conversion rate of 8.713 shares per $1,000
principal amount.
In May 1998, the Company completed the acquisition of Voicetek Corporation
(Voicetek), a leading supplier of interactive voice response (IVR)
applications, based in Chelmsford, Massachusetts. The transaction was
accounted for as a purchase and resulted in a one-time charge of $10 million
in 1998 for purchased in-process technology.
In February 1998, the Company and Lucent Technologies Inc. (Lucent)
announced that they had agreed to dismiss their patent lawsuits against each
other, released each other from claims of past infringement, and settled
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their patent disputes by entering into a cross-license agreement. Under the
terms of the agreement, Aspect agreed to pay Lucent a one-time fee and future
royalties that are not expected to be material to our results of operations.
Aspect recorded a non-recurring charge of $14 million in the year ended
December 31, 1997.
In September 1997, the Company acquired Commerce Soft Inc. (Commerce Soft),
a developer of customer interaction technology. The transaction was accounted
for as a purchase that resulted in a one-time charge of $5 million in 1997
related to in-process technology.
Industry Background and Market Trends
With the proliferation of the Internet and increasing demands by customers
for heightened service, companies adopting a customer relationship management
(CRM) solution across the enterprise improve their ability to gain and retain
customers while expanding their ability to increase revenue and profitability
through personalized customer service.
The CRM industry is growing rapidly as customers expect to be recognized
and receive the same level of service whether they contact the business over
the Web or through e-mail, voice or fax. Businesses seek to optimize these
customer contacts to generate greater revenue and profitabilty.
CRM solutions are often called eCRM because they consolidate customer
information to create a broad view that allows the organization to determine
the customer's value and thereby create a strategic approach to interaction.
eCRM solutions build, sustain and improve both existing and potential
eBusiness relationships. In this way contact centers are evolving into
multimedia centers.
Comprehensive eCRM solutions that integrate the front- and back-office
along with the multimedia center into one centrally managed eBusiness system
based on business rules provide an integrated approach to managing these
customer relationships.
Products
Aspect Communications Corporation is the leading provider of customer
relationship portals, a software platform for building and deploying eCRM
applications that enable businesses to offer consistent interactions with
their customers from one centrally managed eBusiness system.
The Aspect Customer Relationship Portal and its predecessor Contact Center
products represent substantially all of Aspect's product revenue over the past
three years.
I. Aspect Customer Relationship Portal
The Aspect Customer Relationship Portal platform allows companies to build
eCRM applications that integrate front- and back-office, eCommerce and
multimedia contact centers into one centrally managed eBusiness system. It
allows a consistent customer experience through one central application that
connects customers with the right enterprise resource, regardless of how they
contact the business.
The Aspect Customer Relationship Portal software platform comprises three
main elements:
1. The eFlow Engine that centrally manages and executes the business
rules for eCRM applications;
2. CMI(TM) open media connectivity that synchronizes all channels
(voice, e-mail, fax, and the Web) of customer communications; and
3. eRouting that routes resources based on information such as business
metrics and customer data.
The recent acquisition of PakNetX Corporation provides Aspect with
multimedia-over-IP software technology for eCRM applications in any customer
multimedia contact centers. When integrated with the Aspect
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Customer Relationship Portal, this technology, called eBusinessIP, is intended
to extend the functionality of the Aspect Portal as a multimedia eCRM
platform. Together they are intended to provide functionality to control the
delivery of all the primary media types that are anticipated for future
eBusiness and eCRM applications that integrate multimedia channels in a
converged voice/data IP network.
II. Aspect eBusiness Architect
Aspect Customer Relationship Portal applications are developed using Aspect
eBusiness Architect, a single visual drag-and-drop development environment for
defining consistent business rules that are designed to make eCRM applications
easier to build and deploy. eBusiness Architect also includes standard
application workflows, or eFlows, for multimedia interactions, data access,
front-office, and eBusiness functions that reduce development time and
implementation costs for eCRM applications.
III. Aspect Customer Relationship Portal Applications
The following standard Aspect Portal applications are provided:
Aspect Portal Applications for Front-Office that offer standard application
eFlow rules to enable businesses to integrate with applications for sales,
service, and marketing from vendors such as Siebel, Vantive and Clarify. These
applications offer connectivity between front-office applications and Aspect,
Lucent, and Nortel ACDs, providing database lookup and coordinated data-
directed routing to the desktop. They can also improve agent productivity by
integrating Aspect softphone functionality, screen-pop information, and real-
time data status within a single interface.
Aspect Portal Multimedia Application that provides a multimedia blending
engine to match available agent resources with incoming customer interactions
across Call Centers, e-mail response management systems (ERMS) and Web
interaction communications channels, to deliver a consistent customer
experience, regardless of the media used.
Aspect Web Interaction to enable online customers to interact directly with
agents through text chat, IP telephony or callback. Customers can interact
with agents directly and can conduct transactions visually and verbally using
shared browsing, joint page markup, and collaborative form completion. This
provides agents with an opportunity to inform customers, give them individual
attention and help to close the sale.
Aspect Customer E-Mail Application that provides e-mail response management
from the initial analysis and categorization of incoming messages to the
automatic response, queuing, prioritization and routing of e-mail messages for
agent processing. It also includes a suite of agent productivity tools and
reports that enables businesses to consistently deliver customer service
through accurate, efficient, and effective communications. This application is
based on a standalone e-mail response management application licensed from
eGain, which has been integrated into the Aspect Customer Relationship Portal.
eWorkforce Management that supplies managers with real-time information to
predict staffing requirements for agents across all media types, allowing the
balancing of staffing demands with customer service levels.
Aspect Customer Self-Service to handle calls without the assistance of an
agent, using voice prompts, text-to-speech, speech recognition, fax, e-mail,
and the Web, allowing the customer to drive the interaction and self-qualify.
Aspect Call Center Software to process inbound and outbound contacts, route
calls according to agent skills, simultaneously queue calls across multiple
sites, and provide reporting tools for real-time and historical statistical
reporting. This platform offers mission-critical customer call handling and is
scalable to provide investment protection as demand and usage grow.
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IV. Aspect Customer DataMart
Aspect DataMart facilitates out-of-the-box enterprise-wide collection,
management, reporting, and analysis of data from Aspect applications and from
front- and back-office applications. It allows assessment of operational
efficiency and productivity across all media, and provides insight into
customer preferences, patterns and trends that can link the customer's
experience to the organization's business goals.
V. Telephony Server
Aspect's mission critical Windows NT-based Call Center and Aspect Customer
Self-Service Telephony Servers provide the platforms on which Aspect
applications can run.
Customer Services
All Aspect products are supported by our customer support services,
including project management, consulting, installation, education, and
technical support operations.
Our technical support services include on-site and remote access to support
personnel, provided primarily by our support centers located around the world.
Pricing of our support services is generally based on the level of support
contracted and the number of users authorized to access the products. These
contracts generally include update rights for licensed products.
Our project management, consulting, installation, and education services
are provided by employees or consultants, and are based on per-hour or fixed-
quote contracts.
Customer services revenues represented approximately 42%, 33%, and 29% of
total revenues in 1999, 1998, and 1997, respectively.
Product Development
The Company has a continuing program of product development directed toward
the enhancement of existing products based upon current and anticipated
customer needs. The Company's research and product development efforts also
emphasize introduction of new products to broaden the Company's product line
and to reach a larger segment of the eCRM market. During 1999, 1998, and 1997,
Company spending on R&D totaled $86.9 million, $67.9 million, and $45.7
million, respectively. The Company believes that a significant commitment of
financial resources and talent will be necessary to maintain and increase its
competitive position in the years ahead, and expects to increase its total
spending for research and development in 2000.
Manufacturing
The Company's manufacturing operations consist primarily of software
replication and final assembly and testing of materials, components,
subassemblies, and systems, together with related quality management
processes, substantial elements of which are outsourced to third parties. The
Company believes that its approach to design and development has allowed
flexibility in the manufacturing process and has allowed the Company to
satisfy a wide variety of customer configuration requirements while achieving
high quality and reasonable lead times.
The Company orders materials with differing lead times, generally 30 to 120
days ahead of required date of delivery to the Company. Because this is a
longer time frame than the average customer order to shipment cycle, the
Company acquires materials and builds standard assemblies based on forecasted
production requirements. Upon receipt of firm orders from customers, the
Company assembles fully configured systems, and subjects them to a number of
tests before shipment. The Company's manufacturing procedures are designed to
achieve rapid response to customer orders.
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Markets, Segments, and Customers
The Company's operations are reported as one operating segment. All
financial segment information, as well as geographical information, can be
found in the consolidated financial statements and notes thereto in the 1999
Annual Financial Report to Shareholders, an appendix to the 2000 Proxy
Statement, which is incorporated by reference in this Annual Report on Form
10-K. The Company markets and sells its products and services primarily to
large organizations in diversified industries worldwide. The Company has
historically sold its products and services primarily through its direct sales
force. In addition, the Company has agreements under which certain
distributors and original equipment manufacturers sell the Company's products.
The Company anticipates that an increased portion of sales will need to be
generated through third party systems integrators to meet targeted market
share goals.
Competition
The Company believes the market for its products and services is highly
competitive and that competition is likely to intensify. The Company's
principal competitors currently include companies in the eCRM market and
companies that market traditional telephony products and services.
As the hardware requirements for a traditional call center diminish due to
the emergence of the Internet, local area networks, and other factors,
companies in these markets are merging and obtaining significant positions in
the eCRM and traditional telephony products market. Many current and potential
competitors, including Lucent Technologies Inc., Nortel Networks, Alcatel,
Cisco Systems, and Oracle Corporation, have considerably greater resources,
larger customer bases and broader international presence than Aspect.
Consequently, the Company expects to encounter substantial competition from
these and other sources.
Intellectual Property and Related Matters
The Company's success depends in part upon its internally developed
technology. The Company generally enters into confidentiality or license
agreements with its employees, consultants, and vendors, and generally
controls access to and distribution of its software, documentation, and other
proprietary information. Despite these precautions, unauthorized third parties
may copy or otherwise obtain and use the Company's technology. In addition,
third parties may develop similar technology independently.
The Company files patent applications to protect inventions and
improvements that are significant to the development of its business.
Including internally generated patents and two purchased patent portfolios,
the Company currently holds approximately 51 issued United States patents and
a lesser number of issued foreign patents and has pending approximately 50
United States patent applications and a lesser number of corresponding foreign
patent applications that cover various aspects of its technology. The
Company's issued United States patents expire on dates ranging from 2004
through at least 2017. There can be no assurance that any of the claims in the
pending applications will be allowed, or that any issued patents will be
upheld, or that our products will not be circumvented by competitors, or that
any patents or licenses will provide competitive advantages for the Company's
products.
The Company maintains proprietary software that is delivered to its
customers. Under certain circumstances, a limited number of the Company's
customers have been granted licenses to use certain of the Company's
proprietary rights, primarily to ensure the continued maintenance and supply
of certain of the Company's products.
The Company holds licenses from multiple third parties regarding
engineering and manufacturing rights to certain technology that the Company
incorporates in its products. Certain of these technology license rights
expire at various dates through 2004. The Company has also entered into
standard commercial license agreements with several suppliers of operating
systems, databases, and other software used for development and implementation
of the Company's products. These licenses are ongoing and generally involve
the payment of royalties based on the volume of systems the Company ships over
periods of time.
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Employees
As of December 31, 1999, the Company employed approximately 2,360 full-time
employees.
Item 2. Properties
Aspect's headquarters facility consists of four office and manufacturing
buildings, totaling approximately 290,000 square feet, in San Jose,
California. The Company owns one of the buildings, which is approximately
100,000 square feet on 10 acres of land, and occupies the remaining buildings
totaling approximately 190,000 square feet under one lease expiring in 2001,
with an option for a five-year extension. Aspect also has several facilities
to support its European operations. The principal UK operations are located
near London in facilities totaling approximately 67,000 square feet, which are
leased under long-term agreements expiring through 2023. In addition, other
significant European facilities are located near Paris, France, Amsterdam, The
Netherlands, and Frankfurt and Dusseldorf, Germany. In Asia, the Company
occupies sales and support offices in Japan, Singapore, and Australia. Aspect
also occupies several U.S. regional centers for sales and support, totaling
approximately 73,000 square feet under leases expiring through 2004. The
Company occupies approximately 103,000 square feet in facilities located near
Nashville, Tennessee, that are leased through 2006. In the fourth quarter of
1999, a former Voicetek subsidiary building was subleased and the Company
leased a new 106,000 square foot facility in Chelmsford, Massachusetts. Other
North American and international sales and support functions operate from
various leased multi-tenant offices nationwide.
The Company believes its existing facilities are adequate to meet current
requirements and that suitable additional or alternative space will be
available as needed on commercially reasonable terms. See Note 10 to "Notes to
Consolidated Financial Statements," in the 1999 Annual Financial Report to
Shareholders, an appendix to the 2000 Proxy Statement, which is incorporated
by reference in this Annual Report on Form 10-K.
Item 3. Legal Proceedings
Reference is made to Note 11, appearing under the caption "Notes To
Consolidated Financial Statements" on page F-27 of the Registrant's 1999
Annual Financial Report to Shareholders attached as an appendix to the
Registrant's 2000 Proxy Statement, which information is hereby incorporated by
reference.
Item 4. Submission of Matters to a Vote of Security Holders.
No matters were submitted to a vote of security holders during the quarter
ended December 31, 1999.
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PART II
Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters
(a) Reference is made to the information regarding market price range,
market, and dividend information appearing under the captions "Quarterly stock
price," "Stock Listing," and "Dividend Policy" on pages F-32 and the inside
back cover of the Registrant's 1999 Annual Financial Report to Shareholders
attached as an appendix to the Registrant's 2000 Proxy Statement, which
information is hereby incorporated by reference.
(b) Reference is made to the information regarding holders of common stock
appearing under the caption "Stock Listing" on the inside back cover of the
Registrant's 1999 Annual Financial Report to Shareholders attached as an
appendix to the Registrant's 2000 Proxy Statement, which information is hereby
incorporated by reference.
Item 6. Selected Financial Data
Reference is made to selected consolidated financial data for fiscal years
1995 through 1999, appearing under the caption "Selected Consolidated
Financial Data" on page F-1 of the Registrant's 1999 Annual Financial Report
to Shareholders attached as an appendix to the Registrant's 2000 Proxy
Statement, which information is hereby incorporated by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Reference is made to the information appearing under the caption
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" on pages F-2 through F-11 of the Registrant's 1999 Annual
Financial Report to Shareholders attached as an appendix to the Registrant's
2000 Proxy Statement, which information is hereby incorporated by reference.
Item 7a. Quantitative and Qualitative Disclosures About Market Risk
Reference is made to the information appearing under the caption
"Quantitative and Qualitative Disclosures About Financial Market Risk" on
pages F-10 through F-11 of the Registrant's 1999 Annual Financial Report to
Shareholders attached as an appendix to the Registrant's 2000 Proxy Statement,
which information is hereby incorporated by reference.
Item 8. Financial Statements and Supplementary Data
Reference is made to the following information appearing in the
Registrant's 1999 Annual Financial Report to Shareholders attached as an
appendix to the Registrant's 2000 Proxy Statement, which information is hereby
incorporated by reference:
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Description Page(s)
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Consolidated Financial Statements............................. F-12 to F-30
Independent Auditors' Report.................................. F-31
Selected Quarterly Financial Data (unaudited)................. F-32
</TABLE>
Item 9. Changes In and Disagreements With Accountants on Accounting and
Financial Disclosures
Not Applicable.
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PART III
Certain information required by Part III is omitted from this report
because the Registrant filed a definitive proxy statement within 120 days
after the end of its fiscal year pursuant to Regulation 14A for its annual
meeting of shareholders to be held May 4, 2000, and the information included
therein is incorporated herein by reference to the extent detailed below.
Item 10. Directors and Executive Officers of the Registrant
Executive Officers of the Company
The following sets forth certain information with respect to the executive
officers of the Company, and their ages as of March 1, 2000:
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Name Age Position
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<S> <C> <C>
James R. Carreker....... 53 Chairman and Chief Executive Officer
Beatriz V. Infante...... 46 Co-President
Barry Wright............ 50 Co-President
Deborah E. Barber....... 60 Senior Vice President, Human Resources and Corporate
Services
Carol E. Broadbent...... 43 Senior Vice President, Corporate Communications
William H. Delevati..... 51 Senior Vice President, Information Technology and Chief
Information Officer
David D. Hare........... 46 Senior Vice President, Customer Services
Kevin T. Parker......... 40 Senior Vice President, Finance and Chief Financial and
Accounting Officer
</TABLE>
Executive officers serve at the election of the Board of Directors of the
Company. There are no family relationships among any directors or executive
officers of the Company.
Mr. Carreker, a founder of the Company, has served as Chief Executive
Officer and as a director of the Company since its inception in August 1985.
Mr. Carreker also held the title of President of the Company from August 1985
through October 1995 and January 1999 through July 1999. He has served as
Chairman of the Company's Board of Directors since October 1995.
Ms. Infante has been employed by the Company since October 1998, and has
served as an executive officer since that time. Ms. Infante currently holds
the position of Co-President. She has previously served as Executive Vice
President, Products. Prior to joining the Company, Ms. Infante served as
Senior Vice President, Application Server Division, Vice President, Open
Systems Division and Vice President, Digital Products Division at Oracle
Corporation, from January 1994 to October 1998, and Director of Development at
Taligent, Inc. from August 1992 to August 1993.
Mr. Wright has been employed by the Company since June 1999, and has served
as an executive officer since that time. Mr. Wright currently holds the
position of Co-President. Prior to joining the Company, Mr. Wright held
various positions with PeopleSoft Corporation, including Senior Vice
President, North America Operations from December 1994 to May 1999.
Ms. Barber has been employed by the Company since April 1998, and has
served as an executive officer since that time. Ms. Barber currently holds the
position of Senior Vice President, Human Resources and Corporate Services.
Prior to joining the Company, Ms. Barber served as Vice President, Human
Resources and Worldwide Real Estate and Corporate Services at Quantum
Corporation since October 1992. Prior to joining Quantum Corporation, Ms.
Barber served as Vice President, Human Resources at Cray Research Inc.
Ms. Broadbent has been employed by the Company since August 1999, and has
served as an executive officer since that time. Ms. Broadbent currently holds
the position of Senior Vice President, Corporate
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Communications. From May 1991 to November 1994, Ms. Broadbent served as Vice
President, Corporate Marketing at Bay Networks Corporation. Prior to joining
Bay Networks Corporation, Ms. Broadbent served as Director of Marketing at
privately-held GO Corporation.
Mr. Delevati has been employed by the Company since July 1999, and has
served as an executive officer since that time. Mr. Delevati currently holds
the position of Senior Vice President, Information Technology and Chief
Information Officer. Prior to joining the Company, Mr. Delevati served as
Chief Information Officer at Quantum Corporation since November 1995. From
March 1994 to November 1995, Mr. Delevati served as Senior Vice President of
Information Technology and Chief Information Officer at Conner Peripherals.
Mr. Delevati has also held senior IT management positions at Borland, Sun
Microsystems, and Information Builders, Inc. Mr. Delevati is on the Board of
Directors of Versant Corporation.
Mr. Hare has been employed by the Company since June 1999, and has served
as an executive officer since that time. Mr. Hare currently holds the position
of Senior Vice President, Customer Services. Prior to joining the Company, Mr.
Hare served as Chief Operating Officer, Global Support at Baan Corporation
from March 1997 to June 1999. Prior to joining Baan Corporation, Mr. Hare held
the title of Director of Worldwide Support at Auspex Corporation from
September 1996 to March 1997. Prior to joining Auspex Corporation, Mr. Hare
served as Director of Worldwide Technical Support at Amdahl Corporation.
Mr. Parker has been employed by the Company since November 1999, and has
served as an executive officer since that time. Mr. Parker currently holds the
position of Senior Vice President, Finance and Chief Financial Officer. Prior
to joining the Company, Mr. Parker served as Senior Vice President, Finance
and Administration at Fujitsu Computer Products of America from April 1996 to
October 1999. Prior to joining Fujitsu Computer Products of America, Mr.
Parker served as Division Controller at Standard Microsystems.
Information with respect to directors of the Registrant is incorporated by
reference to the information under the caption "Election of Directors" in the
Registrant's Proxy Statement.
Information required by Item 405 of Regulation S-K is incorporated by
reference to the information under the caption "Compliance with Section 16(a)
of the Securities Exchange Act of 1934" in the Registrant's Proxy Statement.
Item 11. Executive Compensation
The information required by this Item is incorporated by reference to the
information under the caption "Executive Compensation" contained in the
Registrant's Proxy Statement.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The information required by this Item is incorporated by reference to the
information under the caption "Security Ownership of Principal Shareholders
and Management" contained in the Registrant's Proxy Statement.
Item 13. Certain Relationships and Related Transactions
The information required by this Item is incorporated by reference to the
information under the caption "Certain Relationships and Related Transactions"
contained in the Registrant's Proxy Statement.
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PART IV
Item 14. Exhibits, Financial Statement Schedule, and Reports on Form 8-K
(a)1. Financial Statements
The financial statements listed in the accompanying index to financial
statements and financial statement schedule are incorporated by reference
as part of this Annual Report on Form 10-K.
2. Financial Statement Schedule
The financial statement schedule listed in the accompanying index to
financial statements and financial statement schedule is filed as part of
this Annual Report on Form 10-K.
3. Exhibits
The exhibits listed in the accompanying index to exhibits are filed or
incorporated by reference as part of this Annual Report on Form 10-K.
(b)Reports on Form 8-K
Not Applicable.
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ASPECT COMMUNICATIONS CORPORATION
INDEX TO FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULE
(Item 14 (a))
<TABLE>
<CAPTION>
Reference Page(s)
-----------------
1999 Annual
Form Report to
10-K Shareholders
---- ------------
<S> <C> <C>
Selected Consolidated Financial Data......................... -- F-1
Consolidated Balance Sheets as of December 31, 1999 and
1998........................................................ -- F-12
Consolidated Statements of Operations for the years ended
December 31, 1999, 1998 and 1997............................ -- F-13
Consolidated Statements of Shareholders' Equity for the years
ended December 31, 1999, 1998 and 1997...................... -- F-14
Consolidated Statements of Cash Flows for the years ended
December 31, 1999, 1998 and 1997............................ -- F-15
Notes to Consolidated Financial Statements................... -- F-16 to F-30
Independent Auditors' Report................................. -- F-31
Selected Quarterly Financial Data (unaudited)................ -- F-32
Consolidated Financial Statements Schedule for the years
ended December 31, 1999, 1998 and 1997: II--Valuation and
Qualifying Accounts and Reserves............................ 12 --
</TABLE>
All other schedules have been omitted, since the required information is
not present or not present in amounts sufficient to require submission of the
schedule, or because the information required is included in the consolidated
financial statements or notes thereto.
11
<PAGE>
ASPECT COMMUNICATIONS CORPORATION
SCHEDULE II--VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997 (in thousands)
<TABLE>
<CAPTION>
Beginning Ending
Balance Additions Deductions Balance
--------- --------- ---------- -------
<S> <C> <C> <C> <C>
1999
Allowance for doubtful accounts....... $4,415 $6,722 $ 3,957(1) $7,180
Warranty reserve...................... $3,347 $ 935 $ 3,570(2) $ 712
1998
Allowance for doubtful accounts....... $1,716 $3,081 $ 382(1) $4,415
Warranty reserve...................... $3,948 $5,083 $ 5,684(2) $3,347
1997
Allowance for doubtful accounts....... $1,202 $1,354 $ 840(1) $1,716
Warranty reserve...................... $3,778 $6,825 $ 6,655(2) $3,948
</TABLE>
- --------
(1) Accounts written off.
(2) Warranty costs incurred.
12
<PAGE>
ASPECT COMMUNICATIONS CORPORATION
INDEX TO EXHIBITS
(Item 14 (a))
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<C> <S>
3.1 Amended and Restated Articles of Incorporation of the Registrant. (3)
3.2 Certificate of Determination of the Rights, Preferences and Privileges
of the Series A Participating Preferred Stock, dated May 11, 1999. (6)
3.3 Bylaws of the Registrant, as amended to date. (3)
3.4 Certificate of Amendment to Registrant's Articles of Incorporation,
dated September 24, 1999. (3)
4.1 Indenture, dated August 10, 1998, by and among the Registrant and
State Street Bank and Trust Company of California, N.A., as Trustee,
including the form of Debenture. (2)
4.2 Form of Debenture (included in Exhibit 4.1). (2)
4.3 Registration Rights Agreement, dated August 10, 1998, by and among the
Registrant, Morgan Stanley & Co. Incorporated and Credit Suisse First
Boston Corporation. (2)
4.4 Preferred Shares Rights Agreement, dated May 11, 1999. (6)
10.2a 1989 Stock Option Plan and forms of option agreements thereunder, as
amended, effective January 22, 1991. (3)
10.2b 1989 Stock Option Plan and forms of option agreements thereunder, as
amended, effective May 20, 1993. (3)
10.3 1989 Directors' Stock Option Plan and forms of option agreements
thereunder. (1)
10.4a 1990 Employee Stock Purchase Plan and form of subscription agreement
thereunder, as amended, effective July 1, 1991. (3)
10.6 Form of Stock Bonus Agreement for the Registrant's Newborn Stock Bonus
Program. (1)
10.7 Form of Indemnification Agreement. (1)
10.39 Lease Agreement between the Registrant and Spieker Partners, dated
October 1,1990, as amended. (3)
10.39a Amendment Number One to the Lease Agreement between the Registrant and
Spieker Partners, dated October 1, 1990. (3)
10.39b Amendment to the Lease Agreement between the Registrant and Spieker
Partners, dated August 1, 1993. (3)
10.39c Amendment to the Lease Agreement between the Registrant and Spieker
Partners, dated October 1, 1993. (3)
10.39d Amendment to the Lease Agreement between the Registrant and Spieker
Properties, L.P., dated July 12, 1995. (3)
10.39e Amendment to the Lease Agreement between the Registrant and Spieker.
(3)
10.56 Patent License Agreement and Mutual Release with Lucent Technologies
Inc., effective as of January 1, 1998. (3)
10.57 Agreement and Plan of Merger dated April 1, 1998, among the
Registrant, Venus Acquisition Corporation, a Delaware corporation and
wholly-owned subsidiary of the Registrant, and Voicetek Corporation a
Massachusetts corporation.(5)
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<C> <S>
10.58 Severance Agreement between the Registrant and Dennis L. Haar, dated
November 11, 1998. (3)
10.59 Severance Agreement between the Registrant and Robert A. Blatt, dated
March 25, 1999. (3)
10.62 Severance Agreement between the Registrant and Kathleen M. Cruz, dated
August 19, 1999.
10.69 Employment Agreement between the Registrant and Eric J. Keller, dated
May 15, 1999. (3)
10.71 Form of Employment Agreement between the Registrant and certain
executive officers of the Registrant. (7)
10.72 Employment Agreement between the Registrant and Beatriz V. Infante,
dated February 16, 2000.
10.73 Promissory Note between the Registrant and Barry Wright, dated August
9, 1999.
10.74 Cash Bonus Agreement between the Registrant and Barry Wright, dated
August 9, 1999.
21.1 Subsidiaries of the Registrant--Jurisdiction of Incorporation.
23.1 Independent Auditors' Consent and Report on Schedule.
24.1 Power of Attorney (see page 15).
27 Financial Data Schedule.
</TABLE>
- --------
(1) Incorporated by reference to exhibit 3.3 to the Registrant's Registration
Statement on Form S-1 and Amendment No. 1 and Amendment No. 2 thereto
(File No. 33-33994), which became effective on April 30, 1990.
(2) Incorporated by reference to Amendment No. 1 to the Registrant's
Registration Statement on Form S-3 filed on December 21, 1998.
(3) Incorporated by reference to identically numbered exhibits to the
Registrant's previously filed Form 10-K's or Form 10-Q's.
(4) Incorporated by reference to the Registrant's Report on Form 8-K, dated
October 19, 1995.
(5) Incorporated by reference to the Registrant's Report on Form 8-K, dated
May 11, 1998.
(6) Incorporated by reference to the Registrant's Registration Statement on
Form 8-A filed June 25, 1999.
(7) The following executive officers signed the above agreement:
(a) James R. Carreker, Chairman and Chief Executive Officer, dated February
16, 2000.
(b) Deborah E. Barber, Senior Vice President, Human Resources and Corporate
Services, dated February 16, 2000.
(c) Carol E. Broadbent, Senior Vice President, Corporate Communications,
dated February 16, 2000.
(d) William H. Delevati, Senior Vice President, Information Technology and
Chief Technology Officer, dated February 16, 2000.
(e) David D. Hare, Senior Vice President, Customer Services, dated February
16, 2000.
(f) Kevin T. Parker, Senior Vice President, Finance and Chief Financial
Officer, dated February 16, 2000.
14
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on March 28, 2000 on its behalf by the undersigned, thereunto duly authorized.
Aspect Communications Corporation
/s/ James R. Carreker
By __________________________________
James R. Carreker,
Chairman and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints jointly and severally James R. Carreker
and Kevin T. Parker, and each one of them, his or her attorneys in fact, each
with the power of substitution, for him or her in any and all capacities, to
sign any and all amendments to this Report on Form 10-K and to file the same,
with exhibits thereunto and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming all that
each of said attorneys-in-fact, or his or her substitute or substitutes, may
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ James R. Carreker Chairman and Chief Executive March 28, 2000
____________________________________ Officer and Director
(James R. Carreker) (Principal Executive
Officer)
/s/ Kevin T. Parker Senior Vice President, March 28, 2000
____________________________________ Finance and Chief Financial
(Kevin T. Parker) Officer (Principal Financial
and Accounting Officer)
/s/ Norman A. Fogelsong Director March 28, 2000
____________________________________
(Norman A. Fogelsong)
/s/ John W. Peth Director March 28, 2000
____________________________________
(John W. Peth)
Director March 28, 2000
____________________________________
(Debra J. Engel)
</TABLE>
15
<PAGE>
Exhibit 10.62
[LETTERHEAD OF ASPECT]
August 19, 1999
Kathleen M. Cruz
17 Suva Court
San Ramon, CA 94583
Dear Kathy:
This letter is to confirm the agreement between you and Aspect
Telecommunications Corporation ("Aspect" or the "Company") regarding your
voluntary separation from employment with the Company.
You have resigned your position as an officer of the Company effective June 1,
1999. Commencing on June 1, 1999 and continuing through and until the earlier
of: (a) March 1, 2000, or (b) the date you accept full-time employment with
another company (the "Termination Date"), Aspect shall retain you as a part-time
employee (the "Transition Period"). Your title for internal record keeping
purposes will be Executive Advisor. During this Transition Period, you will be
available to provide services to Aspect as requested, on a flexible schedule
basis not to exceed 40 hours a month. During the Transition Period, Aspect will
pay you a monthly salary of $19,166.67, less applicable withholdings and any
other employee benefits that you are eligible to receive with the following
exceptions: after June 1, 1999, you will not be eligible to participate in the
accrual of flexible time off hours and the Employee Incentive Plan.
You will receive payment for all accrued but unused flexible time off hours.
You will also receive reimbursement for your last expense report in the amount
of $1,108.41, provided that you have submitted all necessary receipts and report
forms. You will receive payment for these items three days after the Effective
Date.
You agree that the only payments and benefits that you are entitled to receive
from the Company in the future are those specified in this letter. To the
extent provided by the federal COBRA law or, if applicable, state insurance
laws, and by the Company's current group health insurance policies, you will be
eligible to continue your group health insurance benefits at your own expense,
after the Termination Date. Later, you may be able to convert to an individual
policy through the provider of the Company's health insurance, if you wish.
You will receive outplacement services to a maximum amount of $10,000.00, which
shall be paid directly to one executive outplacement firm of your choice for
services before March 1, 2000.
<PAGE>
In consideration for receiving the Transition Period payments and outplacement
services described above, to which you would not otherwise be entitled, you
waive and release and promise never to assert any claims or causes of action,
whether or not now known, against the Company or its predecessors, successors,
subsidiaries, officers, directors, agents, employees and assigns, with respect
to any matter, including but not limited to, any matter arising out of or
connected with your employment with the Company or the termination of that
employment, including without limitation, claims of wrongful discharge,
emotional distress, defamation, fraud, breach of contract, breach of the
covenant of good faith and fair dealing, any claims of discrimination or
harassment based on sex, age, race, national origin, disability or on any other
basis, under Title VII of the Civil Rights Act of 1964, as amended, the
California Fair Employment and Housing Act, the Age Discrimination in Employment
Act of 1967, as amended, and all other laws and regulations relating to
employment, for any such claims arising up to your execution of this agreement.
You understand that this agreement includes a release of all known and unknown
claims. In giving this release, which includes claims that may be unknown at
present, you acknowledge that you have read and understood Section 1542 of the
Civil Code of the State of California (or any analogous law of any other state),
which reads as follows: "A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the time of executing
the release, which, if known by him, must have materially affected his
settlement with the debtor." You expressly waive and release any and all rights
and benefits under this section and any analogous law of any other state.
Nothing contained in this letter shall constitute or be treated as an admission
by you or the Company of liability, of any wrongdoing, or of any violation of
law.
The Company agrees that at all times in the future, it shall indemnify you for
all losses arising out of your discharge of duties with the Company to the full
extent required under California Labor Code section 2802.
At all times in the future, you will remain bound by Aspect's Employee Agreement
signed by you, a copy of which is attached hereto as Exhibit A. You further
agree that personally, or through your agents, you will not engage in any
conduct or communication, whether written or verbal, which is, or could be,
injurious to Aspect's business reputation or to the reputation of any officer or
director of the Company. Likewise the Company and its officers and directors
agree not to engage in any conduct or communications, whether written or verbal,
which could be injurious to your personal or professional reputation. You agree
that you will not voluntarily provide any assistance to any party bringing a
claim against the Company, or preparing to do so, provided that you may
cooperate as required by a court or by law. The Company agrees that all
requests for references on your behalf will be referred to me. You agree that
from now and until one year following your Termination Date, you will not
solicit, or attempt to solicit any Aspect employee or consultant to cease their
relationship with Aspect for any reason.
<PAGE>
You have not and may not disclose to others the existence of this letter, and
the facts or terms of this letter, except that you may disclose such information
to your attorney or accountant in order for such individuals to render services
to you, or as may be required by legal process. In the event that you are asked
about this letter or any dispute you might have with the Company, you shall
restrict your response to "everything has been worked out" or words to that
effect; you shall make no other comments; and if asked further questions you
will respond "I really cannot say anything else about it" or words to that
effect.
YOU AGREE THAT IT WOULD BE IMPRACTICAL AND EXTREMELY DIFFICULT TO ASCERTAIN THE
AMOUNT OF ACTUAL DAMAGES CAUSED BY A MATERIAL BREACH OF THE ABOVE
CONFIDENTIALITY PROVISION. THEREFORE, YOU AGREE THAT IN THE EVENT IT IS
ESTABLISHED BY A LEGAL DECISIONMAKER THAT YOU HAVE VIOLATED SUCH PROVISION, THEN
YOU SHALL PAY TO THE COMPANY, AS LIQUIDATED DAMAGES, $57,500.01 FOR SUCH BREACH.
YOU AND THE COMPANY AGREE THAT THIS LIQUIDATED DAMAGES PROVISION REPRESENTS
REASONABLE COMPENSATION FOR THE LOSS WHICH WOULD BE INCURRED DUE TO ANY SUCH
BREACH.
Based on information provided by Aspect's stock administrator, you currently
hold a combination of Incentive Stock Options and Non-Statutory Stock Options
under the Company's 1989 Stock Incentive Plan (the "Plan") for 122,500 shares
(the "Options"). It is expected that as of March 1, 2000, 82,601 shares of
these options will be vested and 39,899 shares will be unvested. Pursuant to
the terms of the existing stock option agreements for your Options and
provisions of the Plan to which your Options are subject, your Options will
cease vesting on the Termination Date. You will have thirty days from the
Termination Date to exercise the Options to the extent vested. All of the other
terms, conditions, and limitations applicable to your Options pursuant to the
option agreements and the Plan will remain in full force and effect. You also
agree that you have no other stock rights in the Company (or any parent or
subsidiary) other than those rights enumerated in this paragraph.
You agree that except as expressly provided in this letter, this letter renders
null and void any and all prior agreements between you and the Company.
This agreement shall be construed and interpreted in accordance with the laws of
California.
You have up to twenty-one (21) days after receipt of this letter within which to
review it, and to discuss it with an attorney of your own choosing regarding
whether or not you wish to execute it. Furthermore, you have (7) days after you
have signed this letter during which time you may revoke this agreement, and
thus, the eighth day after you have signed this agreement will be the Effective
Date.
<PAGE>
If you wish to revoke this agreement, you may do so by delivering a letter of
revocation to me and you must also return to me the severance payment made to
you pursuant to paragraph 1 above. Because of this revocation period, you
understand that the agreement set forth in this letter shall not become
effective or enforceable until the eighth day after the date you sign this
letter.
Please indicate your agreement with the above terms by signing below.
Sincerely,
/s/ James R. Carreker
James R. Carreker
Chairman and Chief Executive Officer
My agreement with the above terms is signified by my signature below.
Furthermore, I acknowledge that I have read and understand this letter and that
I sign this release of all claims voluntarily, with full appreciation that at no
time in the future may I pursue any of the rights I have waived in this release.
Dated: August 19, 1999 /s/ Kathleen M. Cruz
------------------------------
Kathleen M. Cruz
<PAGE>
EXHIBIT A
---------
EMPLOYEE AGREEMENT
<PAGE>
ASPECT TELECOMMUNICATIONS CORPORATION
EMPLOYEE AGREEMENT
In exchange for my becoming employed (or my employment being continued) by
Aspect Telecommunications Corporation, or its subsidiaries, affiliates, or
successors (hereinafter referred to collectively as the "Company"), I hereby
agree as follows:
EMPLOYMENT I will perform for the Company such duties as may be designated
by the Company from time to time. During my period of employment
by the Company, I will devote my best efforts to the interests
of the Company and will not engage in other employment with any
Aspect competitor customer or supplier without the prior consent
of the Company. I will not accept a position with any other
company if the time demands of the position will impair my
ability to fulfill my obligations to the Company.
DEFINITIONS As used in this agreement, the term "inventions" means designs,
trademarks, discoveries, formulae, processes, manufacturing
techniques, trade secrets, inventions, improvements, ideas,
original works of authorship or copyrightable works, including
all rights to obtain, register, perfect and enforce these
proprietary interests.
As used in this Agreement, the term "Confidential Information"
means information pertaining to any aspects of the Company's
business which is either information not known by actual or
potential competitors of the Company or is proprietary
information of the Company or its customers or suppliers,
whether of a technical nature or otherwise.
ASSIGNMENT OF Without further compensation, I hereby agree promptly to
INVENTIONS disclose to the Company, and I hereby assign and agree to assign
to the Company or its designee, my entire right, title, and
interest in and to all Inventions (a) which pertain to any line
of business activity of the Company, (b) which are aided by the
use of time, material or facilities of the Company, whether or
not during working hours, or (c) which relate to any of my work
during the period of my employment with the Company, whether or
not during normal working hours. No rights are hereby conveyed
in Inventions, if any, made by me prior to my employment with
the Company which are identified on the back of this Agreement
or on in a sheet attached to and made a part of this Agreement,
if any (which attachment contains no confidential information).
I acknowledge that all original works of authorship which are
made by me (solely or jointly with others) within the scope of
my employment and which are protectable by copyright are "works
made for hire," as that term is defined in the United States
Copyright Act as in effect as of this date.
I agree to perform, during and after my employment, all acts
deemed necessary or desirable by the Company to permit and
assist it, at its expense, in obtaining and enforcing the full
benefits, enjoyment, rights and title throughout the world in
the Inventions hereby assigned to the Company. Such acts may
include, but are not limited to, execution of documents and
assistance or cooperation in legal proceedings.
<PAGE>
This Agreement does not apply to an Invention, the assignment of
which to the Company would violate applicable law, including an
Invention which qualified fully under Section 2870 of the
California Labor Code. I agree to disclose in confidence to the
Company all inventions made by me to permit a determination as
to whether or not the Inventions should be the property of the
Company.
CONFIDENTIAL I agree to hold in confidence and not directly or indirectly to
NONDISCLOSURE use or disclose, either during or after termination of my
employment with the Company, any Confidential Information I
obtain or create during the period of my employment, whether or
not during working hours, except to the extent authorized by the
Company, until such Confidential Information becomes generally
known. I agree not to make copies of such Confidential
Information except as authorized by the company. Upon
termination of my employment or upon an earlier request of the
Company I will return or deliver to the Company all tangible
forms of such Confidential Information in my possession or
control, including but not limited to drawings, specifications,
documents, records, devices, models or any other material and
copies or reproductions thereof.
I represent that my performance of all the terms of this
Agreement and as an employee of the Company does not and will
not breach any agreement to keep in confidence proprietary
information, knowledge or data acquired by me in confidence or
in trust prior to my employment with the Company, and I will not
disclose to the Company, or induce the Company to use, any
confidential or proprietary information or material belonging to
any previous employer or others.
NO CONFLICT I agree not to enter into any agreement either written or oral
in conflict with the provisions of this Agreement. I certify
that, to the best of my information and belief, I am not a party
to any other agreement which will interfere with my full
compliance with this Agreement.
SURVIVABILITY This Agreement (a) shall survive my employment by the Company,
(b) does not in any way restrict my right or the right of the
Company to terminate my employment, (c) inures to the benefit of
successors and assigns of the Company, and (d) is binding upon
my heirs and legal representatives.
COMPLIANCE I certify and acknowledge that I have carefully read all of the
provisions of this Agreement and that I understand and will
fully and faithfully comply with such provisions.
ASPECT TELECOMMUNICATIONS EMPLOYEE
CORPORATION
By /s/ Erin Avila By /s/ Kathleen M. Cruz
----------------------------- -------------------------
Title HR Analyst Dated 17 June 1996
-------------------------- -----------------------
<PAGE>
Exhibit 10.71
February 16, 2000
/name/
/title/
Aspect Communications
San Jose, CA 95131
Dear /name/:
This letter agreement (the "Agreement") is to confirm the terms of your
ongoing employment with Aspect Communications Corporation (the "Company") and
supersedes and replaces all prior oral and/or written agreements regarding the
subject matter hereof between you and the Company, including the letter
agreement dated /previous Agreement date/.
1. This Agreement will commence on the date hereof and continue until
February 28, 2002 (the "Original Term"), unless extended for one or more
-------------
additional one-year terms upon mutual written agreement between you and the
Company or unless terminated pursuant to the terms described herein. Approval
by the Company shall be evidenced by the adoption of resolutions by the
Compensation Committee of the Board of Directors of the Company (the
"Committee"). In the event that the Company has entered into discussions with a
---------
third party regarding a Change of Control in the beneficial ownership of the
Company (as defined below) and such Change of Control discussions are ongoing at
the end of the Original Term or any extension, this Agreement automatically
shall be extended until the later of (a) the end of a period of eighteen (18)
months following the closing of such Change of Control transaction or (b) at the
time that the parties have ceased their discussions.
2. You are employed as /title/ of the Company, and as such report to the
Company's chief executive officer. Your job duties and responsibilities are
described on Exhibit A attached hereto. You agree to the best of your ability
---------
and experience that you will, to the reasonable satisfaction of the Company and
its Board, at all times loyally and conscientiously perform all of the duties
and obligations required of you pursuant to the terms of this Agreement;
provided, however, that you shall not be precluded from engaging in civic,
charitable or religious activities, from devoting a reasonable amount of time to
private investments, or from serving on the boards of directors of other
business entities with the prior written approval of the Board of Directors of
the Company (the "Board"), so long as such activities or service do not
interfere with your responsibilities to the Company hereunder. You will comply
with and be bound by the Company's operating policies, procedures and practices
in effect from time to time during the term of your employment.
<PAGE>
3. You acknowledge that your employment is and will continue to be at-
will, as defined under applicable law, and that your employment with the Company
may be terminated by either party at any time for any or no reason, with or
without cause, and with or without notice. If your employment terminates for any
reason, you will not be entitled to any payments, benefits, damages, award or
compensation other than as provided in this Agreement. Notwithstanding the
foregoing, you still shall have the right to receive (i) payment of regular
monthly salary and any bonus that has accrued but is unpaid on the date of
termination, (ii) payment of all of your accrued and unused vacation through the
date of termination, (iii) following your submission of proper expense reports,
reimbursement by the Company for all expenses reasonably and necessarily
incurred by you in connection with the business of the Company prior to
termination, (iv) vested contributions and earnings from the Company's 401(k)
plan, and (v) your rights under any of the Company's employee benefit plans,
policies or arrangements in accordance with the terms of such plans, policies
and arrangements. Any payments described in this paragraph shall be made
promptly upon termination, but in any event in compliance with applicable law
and any applicable terms of the Company's plans, policies, and arrangements. The
rights and duties created by this paragraph may not be modified in any way
except by a written agreement executed by you and the Chief Executive Officer on
behalf of the Company.
4. If your employment is involuntarily terminated other than for Cause (as
defined below) or terminated by you following a Constructive Termination (as
defined below) at any time upon or within twelve (12) months following a Change
of Control (the "Coverage Period"), you will be entitled to receive payment of
severance benefits equal to 24 months of your regular monthly salary plus your
annual target bonus (subject to any applicable tax withholding) in effect on the
date of your termination or upon the occurrence of the Change of Control,
whichever is greater. (Effective January 1, 2001, the Coverage Period shall be
expanded to include the period beginning three (3) months prior to the
occurrence of a Change of Control and ending thirteen (13) months following a
Change of Control.) Payment will be made in a lump sum not more than thirty (30)
days following the date of termination. Provided that you make a timely election
to continue coverage under the Company's group health plans pursuant to the
Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"), health
insurance benefits with the same coverage provided to you prior to the
termination (e.g. medical, dental, optical, mental health) will be provided at
the Company's cost for eighteen (18) months following the termination date, but
not longer than until you are covered by comparable health insurance benefits
from another employer or are otherwise ineligible for COBRA continuation
coverage. Nothing in this Section 4 shall restrict the ability of the Company or
its successor from changing some or all of the terms of such health insurance
benefits, the cost to participants, or other features of such benefits;
provided, however, that all similarly situated participants are treated the
same. In addition, and except as otherwise determined below, each stock option
and share of restricted stock you hold that is not otherwise fully exercisable
and/or vested (i.e., released from the Company's repurchase option) as of the
termination date shall become immediately exercisable and/or vested in full as
of such date.
2
<PAGE>
Notwithstanding the foregoing, you shall not be required to mitigate
the amount of any payment provided for in this Agreement by seeking other
employment or otherwise nor, except for your eligibility for COBRA continuation
coverage, shall the amount of any payment or benefit provided for in this
paragraph be reduced or otherwise affected by any compensation or benefits
received by you as a result of employment by another employer or self-
employment, by any retirement benefits regardless of source, by offset against
any amount claimed to be owed by you to the Company, or otherwise.
5. In the event that the severance and other benefits provided to you by
this Agreement (i) constitute "parachute payments" within the meaning of Section
280G of the Internal Revenue Code of 1986, as amended (the "Code"), or any
----
comparable successor provisions, and (ii) but for this paragraph would be
subject to the excise tax imposed by Section 4999 of the Code, or any comparable
successor provisions (the "Excise Tax"), then your benefits hereunder shall be
either
(i) provided to you in full, or
(ii) provided to you as to such lesser extent which
would result in no portion of such benefits being
subject to the Excise Tax,
whichever of the foregoing amounts, when taking into account applicable federal,
state, local and foreign income and employment taxes, the Excise Tax, and any
other applicable taxes, results in the receipt by you, on an after-tax basis, of
the greatest amount of benefits, notwithstanding that all or some portion of
such benefits may be taxable under the Excise Tax. Unless the Company and you
agree otherwise in writing, any determination required under this paragraph
shall be made in writing in good faith by a qualified third party (the
"Professional Service Firm"). In the event of a reduction of benefits
- --------------------------
hereunder, you shall be given the choice of which benefits to reduce, in the
event that the reduction to zero dollars ($0) of all benefits paid in cash is
insufficient to avoid liability under the Excise Tax. For purposes of making
the calculations required by this paragraph, the Professional Service Firm may
make reasonable assumptions and approximations concerning applicable taxes and
may rely on reasonable, good faith interpretations concerning the application of
the Code, and other applicable legal authority. The Company and you shall
furnish to the Professional Service Firm such information and documents as the
Professional Service Firm may reasonably request in order to make a
determination under this Section 5. The Company shall bear all costs the
Professional Service Firm may reasonably incur in connection with any
calculations contemplated by this paragraph.
If, notwithstanding any reduction described in this paragraph, the
Internal Revenue Service ("IRS") determines that you are liable for the Excise
---
Tax as a result of the receipt of the payment of benefits described above, then
you shall be obligated to pay back to the Company, within thirty (30) days after
a final IRS determination or in the event that you challenge the final IRS
determination, a final judicial determination, a portion of the payment equal to
the "Repayment Amount." The Repayment Amount with respect to the payment of
benefits shall be the smallest amount, if any, as shall be required to be paid
to the Company so that your net after-tax proceeds with respect to any payment
of benefits (after taking into account the payment of the Excise Tax and all
other applicable taxes imposed on such payment) shall be maximized. The
Repayment Amount with respect to the payment of benefits shall be zero if a
Repayment Amount of more than zero would not result in your net after-tax
proceeds with respect to the payment of such benefits being maximized. If the
Excise Tax is not eliminated pursuant to this paragraph, you shall pay the
Excise Tax.
3
<PAGE>
Notwithstanding any other provision of this paragraph, if (i) there is
a reduction in the payment of benefits as described in this paragraph, (ii) the
IRS later determines that you are liable for the Excise Tax, the payment of
which would result in the maximization of your net after-tax proceeds
(calculated as if your benefits previously had not been reduced), and (iii) you
pay the Excise Tax, then the Company shall pay to you those benefits which were
reduced pursuant to this paragraph contemporaneously or as soon as
administratively possible after you pay the Excise Tax so that your net after-
tax proceeds with respect to the payment of benefits is maximized.
6. For purposes of this Agreement, the following definitions will apply:
(a) "Cause" for your termination will exist if the Company terminates
-----
your employment for any of the following reasons: (i) you willfully fail to
substantially perform your duties hereunder (other than any such failure due to
your physical or mental illness), and such willful failure is not remedied
within ten (10) business days after written notice from the Company's Chief
Executive Officer, which written notice shall state that failure to remedy such
conduct may result in an involuntary termination for Cause; (ii) you engage in
willful and serious misconduct (including, but not limited to, an act of fraud
or embezzlement) that has caused or is reasonably expected to result in material
injury to the Company or any of its affiliates, (iii) you are convicted of or
enter a plea of guilty or nolo contendere to a crime that constitutes a felony
related to your employment with the Company or which materially adversely
affects your ability to perform your duties on behalf of the Company, or (iv)
you willfully breach any of your obligations hereunder or under any other
written agreement or covenant with the Company or any of its affiliates,
including, but not limited to, the Confidentiality Agreement, and such willful
breach is not remedied within ten (10) business days after written notice from
the Company's Chief Executive Officer, which written notice shall state that
failure to remedy such conduct may result in an involuntary termination for
Cause.
(b) "Change of Control" will mean (i) a dissolution or liquidation of
-----------------
the Company; (ii) a sale, lease or other disposition of all or substantially
all of the assets of the Company so long as the Company's stockholders of record
immediately prior to such transaction will, immediately after such transaction,
hold less than fifty percent (50%) of the voting power of the acquiring entity;
(iii) an acquisition of the Company by another entity by means of any
transaction or series of related transactions (including, without limitation,
any reorganization, merger or consolidation but excluding any merger effected
exclusively for the purpose of changing the domicile of the Company), so long as
the Company's stockholders of record immediately prior to such transaction or
series of related transactions will, immediately after such transaction or
series of related transactions, hold less than fifty percent (50%) of the voting
power of the surviving or acquiring entity; or (iv) the individuals who, as of
the date of this Agreement, are members of the Board (the "Incumbent Board"),
cease for any reason to constitute at least fifty percent (50%) of the Board.
If the election, or nomination for election by the Company's stockholders, of
any new director was approved by a vote of at least fifty percent (50%) of the
Incumbent Board, such new director shall be considered as a member of the
Incumbent Board.
Effective January 1, 2001, "Change of Control" will mean (i) a
dissolution or liquidation of the Company; (ii) a sale, lease or other
disposition of all or substantially all of the assets of the Company so long as
the Company's stockholders immediately prior to such transaction will,
immediately after such transaction, fail to possess direct or indirect
beneficial ownership of more than fifty percent (50%) of the voting power of the
acquiring entity (for purposes of this clause 7(b)(ii), any person who acquired
securities
4
<PAGE>
of the Company prior to the occurrence of such asset transaction in
contemplation of such transaction and who after such transaction possesses
direct or indirect ownership of at least ten percent (10%) of the securities of
the acquiring entity immediately following such transaction shall not be
included in the group of stockholders of the Company immediately prior to such
transaction); (iii) either a merger or consolidation in which the Company is not
the surviving corporation and the stockholders of the Company immediately prior
to the merger or consolidation fail to possess direct or indirect beneficial
ownership of more than fifty percent (50%) of the voting power of the securities
of the surviving corporation (or if the surviving corporation is a controlled
affiliate of another entity, then the required beneficial ownership shall be
determined with respect to the securities of that entity which controls the
surviving corporation and is not itself a controlled affiliate of any other
entity) immediately following such transaction, or a reverse merger in which the
Company is the surviving corporation and the stockholders of the Company
immediately prior to the reverse merger fail to possess direct or indirect
beneficial ownership of more than fifty percent (50%) of the securities of the
Company (or if the Company is a controlled affiliate of another entity, then the
required beneficial ownership shall be determined with respect to the securities
of that entity which controls the Company and is not itself a controlled
affiliate of any other entity) immediately following the reverse merger (for
purposes of this clause 6(b)(iii), any person who acquired securities of the
Company prior to the occurrence of a merger, reverse merger, or consolidation in
contemplation of such transaction and who after such transaction possesses
direct or indirect beneficial ownership of at least ten percent (10%) of the
securities of the Company or the surviving corporation (or if the Company or the
surviving corporation is a controlled affiliate, then of the appropriate entity
as determined above) immediately following such transaction shall not be
included in the group of stockholders of the Company immediately prior to such
transaction); (iv) an acquisition by any person, entity or group within the
meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), or any comparable successor provisions (excluding
any employee benefit plan, or related trust, sponsored or maintained by the
Company or a subsidiary or other controlled affiliate of the Company) of the
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act, or comparable successor rule) of securities of the Company
representing at least fifty percent (50%) of the combined voting power entitled
to vote in the election of directors; or (v) the individuals who, as of the date
of this Agreement, are members of the Board (the "Incumbent Board"), cease for
any reason to constitute at least fifty percent (50%) of the Board. If the
election, or nomination for election by the Company's stockholders, of any new
director was approved by a vote of at least fifty percent (50%) of the Incumbent
Board, such new director shall be considered as a member of the Incumbent Board.
(c) "Constructive Termination" will be deemed to occur if (A)(i) your
------------------------
duties and responsibilities as Senior Vice President, Human Resources and
Corporate Services of the Company (or a successor corporation) are materially
diminished from your duties and responsibilities as in effect at any time from
the time immediately prior to the occurrence of a Change of Control or at any
time thereafter, without your prior written consent; (ii) any reduction in the
total value of your base compensation and benefits occurs; (iii) your new
business office location is either (a) more than thirty (30) miles in distance
from your current business office location or (b) greater than your current
commute to and from your current business office location; and (B) within sixty
(60) days immediately following such event described in clauses (i) through
(iii) above, you elect to terminate your employment voluntarily. For purposes
of this definition and this Agreement, however, a change in title with
substantially the same duties and responsibilities shall not be considered a
Constructive Termination, should this result solely from an acquisition by a
larger company in which you
5
<PAGE>
have continuing responsibilities for the acquiror which are substantially the
same as those you had for the Company when it was independent.
7. You have signed a document entitled "Employee Agreement" (the
"Confidentiality Agreement") substantially in the form attached hereto as
-------------------------
Exhibit B. You hereby represent and warrant to the Company that you have
- ---------
complied with all obligations under the Confidentiality Agreement and agree to
continue to abide by the terms of the Confidentiality Agreement and further
agree that the provisions of the Confidentiality Agreement will survive any
termination of this Agreement or of your employment relationship with the
Company.
8. Upon your involuntary termination of employment other than for
Cause or your voluntary termination following a Constructive Termination, and as
a condition of the receipt of any benefits under this Agreement, you shall
execute an effective release (the "Release") in substantially the form
-------
incorporated herein and attached hereto as Exhibit C (or if you are under forty
---------
(40) years old at the time of such termination, in substantially the form
attached hereto as Exhibit C with appropriate changes to reflect the
inapplicability of the Age Discrimination in Employment Act) as shall ultimately
be determined by the Company. Such Release shall specifically relate to all of
your rights and claims in existence at the time of such execution and shall
confirm your obligations under the Confidentiality Agreement. It is understood
that you have twenty-one (21) days to consider whether to execute such Release,
and you may revoke such Release within seven (7) business days after execution.
In the event you do not execute such Release within the twenty-one (21) day
period, or if you revoke such Release within the subsequent seven (7) business
day period, no benefits shall be payable under this Agreement and this Agreement
shall be null and void. Notwithstanding the foregoing, in addition to or in lieu
of the Release attached hereto as Exhibit C, you may be required to execute and
deliver an effective release in such other form as the Company may, in its sole
discretion, determine to be necessary or appropriate in order to comply with the
requirements of the laws of any jurisdiction applicable to you in order to make
a general release of claims effective and enforceable.
9. You represent that you have not entered into any agreements,
understandings, or arrangements with any other person or entity which would be
breached by you as a result of, or that would in any way preclude or prohibit
you from entering into this Agreement or performing any of the duties and
responsibilities provided for herein.
10. Any successor to the Company as a result of the occurrence of a
Change of Control (whether direct or indirect and whether by purchase, lease,
merger, consolidation, liquidation or otherwise) or otherwise which succeeds to
all or substantially all of the Company's business and/or assets shall assume
the obligations under this Agreement and agree expressly to perform the
obligations under this Agreement in the same manner and to the same extent as
the Company would be required to perform such obligations in the absence of a
succession. For all purposes under this Agreement, the term "Company" shall
include any successor to the Company's business and/or assets which executes and
delivers the assumption agreement described in this paragraph or which becomes
bound by the terms of this Agreement by operation of law.
The terms of this Agreement and all of your rights hereunder shall
inure to the benefit of, and be enforceable by, your personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees or legatees.
6
<PAGE>
11. This Agreement, including any Exhibits hereto, constitutes the
sole agreement of the parties and supersedes all negotiations and prior
agreements with respect to the subject matter hereof, i.e., the rights and
responsibilities of you and the Company in the event of certain terminations of
your employment with the Company relating to the occurrence of a Change of
Control.
12. Any term of this Agreement may be amended or waived only with the
written consent of the parties.
13. Any notice required or permitted by this Agreement will be in
writing and will be deemed sufficient upon receipt, when delivered personally,
by facsimile or by a nationally-recognized delivery service (such as Federal
Express or Express Mail), or 72 hours after being deposited in the U.S. mail as
certified or registered mail with postage prepaid, if such notice is addressed
to the party to be notified at such party's address as set forth below or as
subsequently modified by written notice.
14. The validity, interpretation, construction and performance of
this Agreement will be governed by the laws of the State of California, without
giving effect to the principles of conflict of laws.
15. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, the parties agree to re-negotiate such
provision in good faith. In the event that the parties cannot reach a mutually
agreeable and enforceable replacement for such provision, then (i) such
provision will be excluded from this Agreement or a legal authority of competent
jurisdiction (including an arbitrator) will have the authority to modify or
replace the invalid or unenforceable provision with a valid and enforceable
provision that most accurately embodies the parties' intention with respect to
the invalid or unenforceable provision, (ii) the balance of the Agreement will
be interpreted as if such provision were so excluded, modified or replaced and
(iii) the balance of the Agreement will be enforceable in accordance with its
terms.
16. You and the Company agree to attempt to settle any disputes
arising in connection with this Agreement through good faith consultation. In
the event that we are not able to resolve any such disputes within fifteen (15)
days after notification in writing to the other, we agree that any dispute or
claim arising out of or in connection with this Agreement will be finally
settled by binding arbitration in Santa Clara County, California in accordance
with the rules of the American Arbitration Association by one arbitrator
appointed in accordance with said rules. The arbitrator will apply California
law, without reference to rules of conflicts of law or rules of statutory
arbitration, to the resolution of any dispute. Judgment on the award rendered by
the arbitrator may be entered in any court having jurisdiction thereof.
Notwithstanding the foregoing, the parties may apply to any court of competent
jurisdiction for preliminary or interim equitable relief, or to compel
arbitration in accordance with this paragraph, without breach of this
arbitration provision. You agree that punitive damages will not be awarded. This
paragraph will not apply to the Confidentiality Agreement.
If there is termination of your employment with the Company
followed by a dispute as to whether you are entitled to the benefits provided
under this Agreement, then, during the period of that dispute the Company shall
pay you fifty percent (50%) of the amount specified in Section 4 hereof (except
that the Company shall pay one hundred percent (100%) of any insurance premiums
provided for in Section 4), if, and only if, you agree in writing that if the
dispute is resolved against you, you shall promptly refund to the Company
7
<PAGE>
all payments you receive plus interest at the rate provided in Section 1274(d)
of the Code, compounded quarterly. If the dispute is resolved in your favor,
promptly after resolution of the dispute the Company shall pay you the sum that
was withheld during the period of the dispute plus interest at the rate provided
in Section 1274(d) of the Code, compounded quarterly.
Notwithstanding any other provisions of this Agreement, if you
either (i) bring any action to enforce your rights pursuant to this Agreement,
or (ii) defend any legal challenge to your rights hereunder, you shall be
entitled to recover reasonable attorneys' fees and costs incurred in connection
with such action from the Company, payable on a monthly basis, regardless of the
outcome of such action; provided, however, that in the event such action is
commenced by you, the court finds the claim was brought in good faith.
17. You acknowledge that, in executing this Agreement, you have had
the opportunity to seek the advice of independent legal counsel, and have read
and understood all of the terms and provisions of this Agreement.
Please indicate your agreement with the above terms by signing below.
Sincerely,
Aspect Communications Corporation
By: /name/
Title: /title/
Address: 1310 Ridder Park Drive
San Jose, CA 95131
Facsimile Number: (408) 325-2261
My signature below signifies my agreement with the above terms.
By: __________________________________________________
Address: _____________________________________________
Facsimile Number:_____________________________________
8
<PAGE>
EXHIBIT A
---------
Description of Job Duties
And Responsibilities
/name and tile and description/
- ---------------
<PAGE>
EXHIBIT B
---------
CONFIDENTIALITY AGREEMENT
--------------------------
<PAGE>
EXHIBIT C
---------
RELEASE
-------
<PAGE>
RELEASE
[NOTE: INCLUDES ADEA LANGUAGE]
Certain capitalized terms used in this Release are defined in the letter
agreement between me and the Company dated _/date/____________, (the
"Agreement") which I have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's Confidentiality
Agreement.
Except as otherwise set forth in this Release, I hereby release, acquit and
forever discharge the Company, its parents and subsidiaries, and their officers,
directors, agents, servants, employees, shareholders, successors, assigns and
affiliates, of and from any and all claims, liabilities, demands, causes of
action, costs, expenses, attorneys fees, damages, indemnities and obligations of
every kind and nature, in law, equity, or otherwise, known and unknown,
suspected and unsuspected, disclosed and undisclosed (other than any claim for
indemnification I may have as a result of any third party action against me
based on my employment with the Company), arising out of or in any way related
to agreements, events, acts or conduct at any time prior to the date I execute
this Release, including, but not limited to: all such claims and demands
directly or indirectly arising out of or in any way connected with my employment
with the Company or the termination of that employment, including but not
limited to, claims of intentional and negligent infliction of emotional
distress, any and all tort claims for personal injury, claims or demands related
to salary, bonuses, commissions, stock, stock options, or any other ownership
interests in the Company, vacation pay, fringe benefits, expense reimbursements,
severance pay, or any other form of disputed compensation; claims pursuant to
any federal, state or local law or cause of action including, but not limited
to, the federal Civil Rights Act of 1964, as amended; the federal Age
Discrimination in Employment Act of 1967, as amended ("ADEA"); the federal
Employee Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; tort law; contract law; statutory law;
common law; wrongful discharge; discrimination; fraud; defamation; emotional
distress; and breach of the implied covenant of good faith and fair dealing;
provided, however, that nothing in this paragraph shall be construed in any way
to release the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or applicable law.
In giving this release, which includes claims that may be unknown to me at
present, I acknowledge that I have read and understand Section 1542 of the
California Civil Code which reads as follows: "A general release does not
extend to claims which the creditor does not know or suspect to exist in his
favor at the time of executing the release, which if known by him must have
materially affected his settlement with the debtor." I expressly waive and
relinquish all rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any unknown or
unsuspected claims I may have against the Company.
I acknowledge that I am knowingly and voluntarily waiving and releasing any
rights I may have under ADEA. I also acknowledge that the consideration given
under this Agreement for the waiver and release in the preceding paragraph
hereof is in addition to anything of value to which I was already entitled. I
further acknowledge that I have been advised by this writing, as required by the
ADEA, that: (A) my waiver and release do not apply to any rights or claims that
may arise on or after the date I execute this Release; (B) I have the right to
consult with an attorney prior to executing this Release; (C) I have twenty-one
(21) days to consider this Release (although I may choose to voluntarily execute
this Release earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release shall not be
effective until the date upon which the revocation period has expired, which
shall be the eighth day after this Release is executed by me.
By: _________/name/_____________________
Date: _______/date/_______________________
<PAGE>
Exhibit 10.72
February 16, 2000
Ms. Beatriz V. Infante
Co-President
Aspect Communications
San Jose, Ca 95131
Dear Beatriz:
This letter agreement (the "Agreement") is to confirm the terms of your
ongoing employment with Aspect Communications Corporation (the "Company") and
supersedes and replaces all prior oral and/or written agreements regarding the
subject matter hereof between you and the Company, including the letter
agreement dated March 1, 1999.
1. This Agreement will commence on the date hereof and continue until
February 28, 2002 (the "Original Term"), unless extended for one or more
-------------
additional one-year terms upon mutual written agreement between you and the
Company or unless terminated pursuant to the terms described herein. Approval
by the Company shall be evidenced by the adoption of resolutions by the
Compensation Committee of the Board of Directors of the Company (the
"Committee"). In the event that the Company has entered into discussions with a
---------
third party regarding a Change of Control in the beneficial ownership of the
Company (as defined below) and such Change of Control discussions are ongoing at
the end of the Original Term or any extension, this Agreement automatically
shall be extended until the later of (a) the end of a period of eighteen (18)
months following the closing of such Change of Control transaction or (b) at the
time that the parties have ceased their discussions.
2. You are employed as Co-President of the Company, and as such report to
the Company's Chairman and Chief Executive Officer. Your job duties and
responsibilities are described on Exhibit A attached hereto. You agree to the
---------
best of your ability and experience that you will, to the reasonable
satisfaction of the Company and its Board, at all times loyally and
conscientiously perform all of the duties and obligations required of you
pursuant to the terms of this Agreement; provided, however, that you shall not
be precluded from engaging in civic, charitable or religious activities, from
devoting a reasonable amount of time to private investments, or from serving on
the boards of directors of other business entities with the prior written
approval of the Board of Directors of the Company (the "Board"), so long as such
activities or service do not interfere with your responsibilities to the Company
hereunder. You will comply with and be bound by the Company's operating
policies, procedures and practices in effect from time to time during the term
of your employment.
3. You acknowledge that your employment is and will continue to be at-
will, as defined under applicable law, and that your employment with the Company
may be terminated by either party at any time for any or no reason, with or
without cause, and with or without notice. If your employment terminates for
any reason, you will not be entitled to any payments, benefits, damages, award
or compensation other than as provided in this Agreement. Notwithstanding the
foregoing, you still shall have the right to receive (i)
<PAGE>
payment of regular monthly salary and any bonus that has accrued but is unpaid
on the date of termination, (ii) payment of all of your accrued and unused
vacation through the date of termination, (iii) following your submission of
proper expense reports, reimbursement by the Company for all expenses reasonably
and necessarily incurred by you in connection with the business of the Company
prior to termination, (iv) vested contributions and earnings from the Company's
401(k) plan, and (v) your rights under any of the Company's employee benefit
plans, policies or arrangements in accordance with the terms of such plans,
policies and arrangements. Any payments described in this paragraph shall be
made promptly upon termination, but in any event in compliance with applicable
law and any applicable terms of the Company's plans, policies, and arrangements.
The rights and duties created by this paragraph may not be modified in any way
except by a written agreement executed by you and the Chief Executive Officer on
behalf of the Company.
4. If your employment is involuntarily terminated other than for Cause (as
defined below) or terminated by you following a Constructive Termination (as
defined below) at any time upon or within twelve (12) months following a Change
of Control (the "Coverage Period"), you will be entitled to receive payment of
severance benefits equal to 24 months of your regular monthly salary plus your
annual target bonus (subject to any applicable tax withholding) in effect on the
date of your termination or upon the occurrence of the Change of Control,
whichever is greater. (Effective January 1, 2001, the Coverage Period shall be
expanded to include the period beginning three (3) months prior to the
occurrence of a Change of Control and ending thirteen (13) months following a
Change of Control.) Payment will be made in a lump sum not more than thirty (30)
days following the date of termination. Provided that you make a timely election
to continue coverage under the Company's group health plans pursuant to the
Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"), health
insurance benefits with the same coverage provided to you prior to the
termination (e.g., medical, dental, optical, mental health) will be provided at
the Company's cost for eighteen (18) months following the termination date, but
not longer than until you are covered by comparable health insurance benefits
from another employer or are otherwise ineligible for COBRA continuation
coverage. Nothing in this Section 4 shall restrict the ability of the Company or
its successor from changing some or all of the terms of such health insurance
benefits, the cost to participants, or other features of such benefits;
provided, however, that all similarly situated participants are treated the
same. In addition, and except as otherwise determined below, each stock option
and share of restricted stock you hold that is not otherwise fully exercisable
and/or vested (i.e., released from the Company's repurchase option) as of the
termination date shall become immediately exercisable and/or vested in full as
of such date.
Notwithstanding the foregoing, you shall not be required to mitigate
the amount of any payment provided for in this Agreement by seeking other
employment or otherwise nor, except for your eligibility for COBRA continuation
coverage, shall the amount of any payment or benefit provided for in this
paragraph be reduced or otherwise affected by any compensation or benefits
received by you as a result of employment by another employer or self-
employment, by any retirement benefits regardless of source, by offset against
any amount claimed to be owed by you to the Company, or otherwise.
5. If any change of management of the Company occurs, without a Change of
Control, which either (i) creates an additional level of management between you
and the Chairman (not existing at the date hereof), or (ii) replaces the
existing Chief Executive Officer (other than by a person employed by the Company
on the date hereof or employed by the Company for at least one (1) year at the
time of replacement), and within six (6) months following such change of
management there is either a material reduction of your duties and
2
<PAGE>
responsibilities or a reduction of your base compensation, then in the event of
either a voluntary termination by you or an involuntary termination other than
for Cause within sixty (60) days following such reduction of duties,
responsibilities or base compensation you shall be entitled to receive payment
of severance benefits equal to one hundred fifty percent (150%) of your then
current annual base salary (subject to any applicable tax withholding) in effect
on the date of your termination or upon the occurrence of such change of
management, whichever is greater. Payment will be made in a lump sum not more
than thirty (30) days following the date of termination. Provided that you make
a timely election to continue coverage under the Company's group health plans
pursuant to COBRA, health insurance benefits with the same coverage provided to
you prior to the termination date (e.g., medical, dental, optical, mental
health) will be provided at the Company's cost for eighteen (18) months
following the termination date, but not longer than until you are covered by
comparable health insurance benefits from another employer or are otherwise
ineligible for COBRA continuation coverage. Nothing in this Section 5 shall
restrict the ability of the Company or its successor from changing some or all
of the terms of such health insurance benefits, the cost to participants, or
other features of such benefits; provided, however, that all similarly situated
participants are treated the same.
Notwithstanding the foregoing, you shall not be required to mitigate
the amount of any payment provided for in this Agreement by seeking other
employment or otherwise nor, except for your eligibility for COBRA continuation
coverage, shall the amount of any payment or benefit provided for in this
paragraph be reduced or otherwise affected by any compensation or benefits
received by you as a result of employment by another employer or self-
employment, by any retirement benefits regardless of source, by offset against
any amount claimed to be owed by you to the Company, or otherwise.
In the event both Sections 4 and 5 are triggered, you shall be
entitled to receive the greater of the amounts specified in Sections 4 or 5, but
not both.
6. In the event that the severance and other benefits provided to you by
this Agreement (i) constitute "parachute payments" within the meaning of Section
280G of the Internal Revenue Code of 1986, as amended (the "Code"), or any
----
comparable successor provisions, and (ii) but for this paragraph would be
subject to the excise tax imposed by Section 4999 of the Code, or any comparable
successor provisions (the "Excise Tax"), then your benefits hereunder shall be
either
(i) provided to you in full, or
(ii) provided to you as to such lesser extent which
would result in no portion of such benefits being
subject to the Excise Tax,
whichever of the foregoing amounts, when taking into account applicable federal,
state, local and foreign income and employment taxes, the Excise Tax, and any
other applicable taxes, results in the receipt by you, on an after-tax basis, of
the greatest amount of benefits, notwithstanding that all or some portion of
such benefits may be taxable under the Excise Tax. Unless the Company and you
agree otherwise in writing, any determination required under this paragraph
shall be made in writing in good faith by a qualified third party (the
"Professional Service Firm"). In the event of a reduction of benefits
- --------------------------
hereunder, you shall be given the choice of which benefits to reduce, in the
event that the reduction to zero dollars ($0) of all benefits paid in cash is
insufficient to avoid liability under the Excise Tax. For purposes of making
the calculations required by this paragraph, the Professional Service Firm
3
<PAGE>
may make reasonable assumptions and approximations concerning applicable taxes
and may rely on reasonable, good faith interpretations concerning the
application of the Code, and other applicable legal authority. The Company and
you shall furnish to the Professional Service Firm such information and
documents as the Professional Service Firm may reasonably request in order to
make a determination under this Section 6. The Company shall bear all costs the
Professional Service Firm may reasonably incur in connection with any
calculations contemplated by this paragraph.
If, notwithstanding any reduction described in this paragraph, the
Internal Revenue Service ("IRS") determines that you are liable for the Excise
---
Tax as a result of the receipt of the payment of benefits described above, then
you shall be obligated to pay back to the Company, within thirty (30) days after
a final IRS determination or in the event that you challenge the final IRS
determination, a final judicial determination, a portion of the payment equal to
the "Repayment Amount." The Repayment Amount with respect to the payment of
benefits shall be the smallest amount, if any, as shall be required to be paid
to the Company so that your net after-tax proceeds with respect to any payment
of benefits (after taking into account the payment of the Excise Tax and all
other applicable taxes imposed on such payment) shall be maximized. The
Repayment Amount with respect to the payment of benefits shall be zero if a
Repayment Amount of more than zero would not result in your net after-tax
proceeds with respect to the payment of such benefits being maximized. If the
Excise Tax is not eliminated pursuant to this paragraph, you shall pay the
Excise Tax.
Notwithstanding any other provision of this paragraph, if (i) there is
a reduction in the payment of benefits as described in this paragraph, (ii) the
IRS later determines that you are liable for the Excise Tax, the payment of
which would result in the maximization of your net after-tax proceeds
(calculated as if your benefits previously had not been reduced), and (iii) you
pay the Excise Tax, then the Company shall pay to you those benefits which were
reduced pursuant to this paragraph contemporaneously or as soon as
administratively possible after you pay the Excise Tax so that your net after-
tax proceeds with respect to the payment of benefits is maximized.
7. For purposes of this Agreement, the following definitions will apply:
(a) "Cause" for your termination will exist if the Company terminates
-----
your employment for any of the following reasons: (i) you willfully fail to
substantially perform your duties hereunder (other than any such failure due to
your physical or mental illness), and such willful failure is not remedied
within ten (10) business days after written notice from the Company's Chief
Executive Officer, which written notice shall state that failure to remedy such
conduct may result in an involuntary termination for Cause; (ii) you engage in
willful and serious misconduct (including, but not limited to, an act of fraud
or embezzlement) that has caused or is reasonably expected to result in material
injury to the Company or any of its affiliates, (iii) you are convicted of or
enter a plea of guilty or nolo contendere to a crime that constitutes a felony
related to your employment with the Company or which materially adversely
affects your ability to perform your duties on behalf of the Company, or (iv)
you willfully breach any of your obligations hereunder or under any other
written agreement or covenant with the Company or any of its affiliates,
including, but not limited to, the Confidentiality Agreement, and such willful
breach is not remedied within ten (10) business days after written notice from
the Company's Chief Executive Officer, which written notice shall state that
failure to remedy such conduct may result in an involuntary termination for
Cause.
4
<PAGE>
(b) "Change of Control" will mean (i) a dissolution or
-----------------
liquidation of the Company; (ii) a sale, lease or other disposition of all or
substantially all of the assets of the Company so long as the Company's
stockholders of record immediately prior to such transaction will, immediately
after such transaction, hold less than fifty percent (50%) of the voting power
of the acquiring entity; (iii) an acquisition of the Company by another entity
by means of any transaction or series of related transactions (including,
without limitation, any reorganization, merger or consolidation but excluding
any merger effected exclusively for the purpose of changing the domicile of the
Company), so long as the Company's stockholders of record immediately prior to
such transaction or series of related transactions will, immediately after such
transaction or series of related transactions, hold less than fifty percent
(50%) of the voting power of the surviving or acquiring entity; or (iv) the
individuals who, as of the date of this Agreement, are members of the Board (the
"Incumbent Board"), cease for any reason to constitute at least fifty percent
(50%) of the Board. If the election, or nomination for election by the Company's
stockholders, of any new director was approved by a vote of at least fifty
percent (50%) of the Incumbent Board, such new director shall be considered as a
member of the Incumbent Board.
Effective January 1, 2001, "Change of Control" will mean
(i) a dissolution or liquidation of the Company; (ii) a sale, lease or other
disposition of all or substantially all of the assets of the Company so long as
the Company's stockholders immediately prior to such transaction will,
immediately after such transaction, fail to possess direct or indirect
beneficial ownership of more than fifty percent (50%) of the voting power of the
acquiring entity (for purposes of this clause 7(b)(ii), any person who acquired
securities of the Company prior to the occurrence of such asset transaction in
contemplation of such transaction and who after such transaction possesses
direct or indirect ownership of at least ten percent (10%) of the securities of
the acquiring entity immediately following such transaction shall not be
included in the group of stockholders of the Company immediately prior to such
transaction); (iii) either a merger or consolidation in which the Company is not
the surviving corporation and the stockholders of the Company immediately prior
to the merger or consolidation fail to possess direct or indirect beneficial
ownership of more than fifty percent (50%) of the voting power of the securities
of the surviving corporation (or if the surviving corporation is a controlled
affiliate of another entity, then the required beneficial ownership shall be
determined with respect to the securities of that entity which controls the
surviving corporation and is not itself a controlled affiliate of any other
entity) immediately following such transaction, or a reverse merger in which the
Company is the surviving corporation and the stockholders of the Company
immediately prior to the reverse merger fail to possess direct or indirect
beneficial ownership of more than fifty percent (50%) of the securities of the
Company (or if the Company is a controlled affiliate of another entity, then the
required beneficial ownership shall be determined with respect to the securities
of that entity which controls the Company and is not itself a controlled
affiliate of any other entity) immediately following the reverse merger (for
purposes of this clause 6(b)(iii), any person who acquired securities of the
Company prior to the occurrence of a merger, reverse merger, or consolidation in
contemplation of such transaction and who after such transaction possesses
direct or indirect beneficial ownership of at least ten percent (10%) of the
securities of the Company or the surviving corporation (or if the Company or the
surviving corporation is a controlled affiliate, then of the appropriate entity
as determined above) immediately following such transaction shall not be
included in the group of stockholders of the Company immediately prior to such
transaction); (iv) an acquisition by any person, entity or group within the
meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), or any comparable successor provisions (excluding
any employee benefit plan, or related trust, sponsored or maintained by the
Company or a subsidiary or other controlled affiliate of the Company) of the
beneficial ownership (within
5
<PAGE>
the meaning of Rule 13d-3 promulgated under the Exchange Act, or comparable
successor rule) of securities of the Company representing at least fifty percent
(50%) of the combined voting power entitled to vote in the election of
directors; or (v) the individuals who, as of the date of this Agreement, are
members of the Board (the "Incumbent Board"), cease for any reason to constitute
at least fifty percent (50%) of the Board. If the election, or nomination for
election by the Company's stockholders, of any new director was approved by a
vote of at least fifty percent (50%) of the Incumbent Board, such new director
shall be considered as a member of the Incumbent Board.
(c) "Constructive Termination" will be deemed to occur if (A)(i) your
------------------------
duties and responsibilities as Co-President of the Company (or a successor
corporation) are materially diminished from your duties and responsibilities as
in effect at any time from the time immediately prior to the occurrence of a
Change of Control or at any time thereafter, without your prior written consent;
(ii) any reduction in the total value of your base compensation and benefits
occurs; (iii) your new business office location is either (a) more than thirty
(30) miles in distance from your current business office location or (b) greater
than your current commute to and from your current business office location; and
(B) within sixty (60) days immediately following such event described in clauses
(i) through (iii) above, you elect to terminate your employment voluntarily.
For purposes of this definition and this Agreement, however, a change in title
with substantially the same duties and responsibilities shall not be considered
a Constructive Termination, should this result solely from an acquisition by a
larger company in which you have continuing responsibilities for the acquiror
which are substantially the same as those you had for the Company when it was
independent.
8. You have signed a document entitled "Employee Agreement" (the
"Confidentiality Agreement") substantially in the form attached hereto as
-------------------------
Exhibit B. You hereby represent and warrant to the Company that you have
- ---------
complied with all obligations under the Confidentiality Agreement and agree to
continue to abide by the terms of the Confidentiality Agreement and further
agree that the provisions of the Confidentiality Agreement will survive any
termination of this Agreement or of your employment relationship with the
Company.
9. Upon your involuntary termination of employment other than for Cause
or your voluntary termination following a Constructive Termination, and as a
condition of the receipt of any benefits under this Agreement, you shall execute
an effective release (the "Release") in substantially the form incorporated
-------
herein and attached hereto as Exhibit C (or if you are under forty (40) years
---------
old at the time of such termination, in substantially the form attached hereto
as Exhibit C with appropriate changes to reflect the inapplicability of the Age
Discrimination in Employment Act) as shall ultimately be determined by the
Company. Such Release shall specifically relate to all of your rights and
claims in existence at the time of such execution and shall confirm your
obligations under the Confidentiality Agreement. It is understood that you have
twenty-one (21) days to consider whether to execute such Release, and you may
revoke such Release within seven (7) business days after execution. In the
event you do not execute such Release within the twenty-one (21) day period, or
if you revoke such Release within the subsequent seven (7) business day period,
no benefits shall be payable under this Agreement and this Agreement shall be
null and void. Notwithstanding the foregoing, in addition to or in lieu of the
Release attached hereto as Exhibit C, you may be required to execute and deliver
an effective release in such other form as the Company may, in its sole
discretion, determine to be necessary or appropriate in order to comply with the
requirements of the laws of any jurisdiction applicable to you in order to make
a general release of claims effective and enforceable.
6
<PAGE>
10. You represent that you have not entered into any agreements,
understandings, or arrangements with any other person or entity which would be
breached by you as a result of, or that would in any way preclude or prohibit
you from entering into this Agreement or performing any of the duties and
responsibilities provided for herein.
11. Any successor to the Company as a result of the occurrence of a Change
of Control (whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) or otherwise which succeeds to all or
substantially all of the Company's business and/or assets shall assume the
obligations under this Agreement and agree expressly to perform the obligations
under this Agreement in the same manner and to the same extent as the Company
would be required to perform such obligations in the absence of a succession.
For all purposes under this Agreement, the term "Company" shall include any
successor to the Company's business and/or assets which executes and delivers
the assumption agreement described in this paragraph or which becomes bound by
the terms of this Agreement by operation of law.
The terms of this Agreement and all of your rights hereunder shall
inure to the benefit of, and be enforceable by, your personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees or legatees.
12. This Agreement, including any Exhibits hereto, constitutes the sole
agreement of the parties and supersedes all negotiations and prior agreements
with respect to the subject matter hereof, i.e., the rights and responsibilities
of you and the Company in the event of certain terminations of your employment
with the Company relating to the occurrence of a Change of Control.
13. Any term of this Agreement may be amended or waived only with the
written consent of the parties.
14. Any notice required or permitted by this Agreement will be in writing
and will be deemed sufficient upon receipt, when delivered personally, by
facsimile or by a nationally-recognized delivery service (such as Federal
Express or Express Mail), or 72 hours after being deposited in the U.S. mail as
certified or registered mail with postage prepaid, if such notice is addressed
to the party to be notified at such party's address as set forth below or as
subsequently modified by written notice.
15. The validity, interpretation, construction and performance of this
Agreement will be governed by the laws of the State of California, without
giving effect to the principles of conflict of laws.
16. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, the parties agree to re-negotiate such
provision in good faith. In the event that the parties cannot reach a mutually
agreeable and enforceable replacement for such provision, then (i) such
provision will be excluded from this Agreement or a legal authority of competent
jurisdiction (including an arbitrator) will have the authority to modify or
replace the invalid or unenforceable provision with a valid and enforceable
provision that most accurately embodies the parties' intention with respect to
the invalid or unenforceable provision, (ii) the balance of the Agreement will
be interpreted as if such provision were so excluded, modified or replaced and
(iii) the balance of the Agreement will be enforceable in accordance with its
terms.
7
<PAGE>
17. You and the Company agree to attempt to settle any disputes arising in
connection with this Agreement through good faith consultation. In the event
that we are not able to resolve any such disputes within fifteen (15) days after
notification in writing to the other, we agree that any dispute or claim arising
out of or in connection with this Agreement will be finally settled by binding
arbitration in Santa Clara County, California in accordance with the rules of
the American Arbitration Association by one arbitrator appointed in accordance
with said rules. The arbitrator will apply California law, without reference to
rules of conflicts of law or rules of statutory arbitration, to the resolution
of any dispute. Judgment on the award rendered by the arbitrator may be entered
in any court having jurisdiction thereof. Notwithstanding the foregoing, the
parties may apply to any court of competent jurisdiction for preliminary or
interim equitable relief, or to compel arbitration in accordance with this
paragraph, without breach of this arbitration provision. You agree that
punitive damages will not be awarded. This paragraph will not apply to the
Confidentiality Agreement.
If there is termination of your employment with the Company followed
by a dispute as to whether you are entitled to the benefits provided under
Section 4 of this Agreement, then, during the period of that dispute the Company
shall pay you fifty percent (50%) of the amount specified in Section 4 hereof
(except that the Company shall pay one hundred percent (100%) of any insurance
premiums provided for in Section 4), if, and only if, you agree in writing that
if the dispute is resolved against you, you shall promptly refund to the Company
all payments you receive plus interest at the rate provided in Section 1274(d)
of the Code, compounded quarterly. If the dispute is resolved in your favor,
promptly after resolution of the dispute the Company shall pay you the sum that
was withheld during the period of the dispute plus interest at the rate provided
in Section 1274(d) of the Code, compounded quarterly.
Notwithstanding any other provisions of this Agreement, if you either
(i) bring any action to enforce your rights pursuant to this Agreement, or (ii)
defend any legal challenge to your rights hereunder, you shall be entitled to
recover reasonable attorneys' fees and costs incurred in connection with such
action from the Company, payable on a monthly basis, regardless of the outcome
of such action; provided, however, that in the event such action is commenced by
you, the court finds the claim was brought in good faith.
8
<PAGE>
18. You acknowledge that, in executing this Agreement, you have had the
opportunity to seek the advice of independent legal counsel, and have read and
understood all of the terms and provisions of this Agreement.
Please indicate your agreement with the above terms by signing below.
Sincerely,
Aspect Communications Corporation
By: /s/ James R. Carreker
----------------------
Title: Chairman & Chief Executive Officer
Address: 1310 Ridder Park Drive
San Jose, CA 95131
Facsimile Number: (408) 325-2261
My signature below signifies my agreement with the above terms.
By: /s/ Beatriz V. Infante
________________________________
Address: __________________________________
Facsimile Number: _________________________
9
<PAGE>
EXHIBIT A
---------
Description of Job Duties
And Responsibilities
/name, title, and description of job duties/
- ---------------------------------------------
<PAGE>
EXHIBIT B
---------
CONFIDENTIALITY AGREEMENT
-------------------------
<PAGE>
EXHIBIT C
---------
RELEASE
-------
<PAGE>
RELEASE
[NOTE: INCLUDES ADEA LANGUAGE]
Certain capitalized terms used in this Release are defined in the letter
agreement between me and the Company dated _/date/_____, (the "Agreement") which
I have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's Confidentiality
Agreement.
Except as otherwise set forth in this Release, I hereby release, acquit and
forever discharge the Company, its parents and subsidiaries, and their officers,
directors, agents, servants, employees, shareholders, successors, assigns and
affiliates, of and from any and all claims, liabilities, demands, causes of
action, costs, expenses, attorneys fees, damages, indemnities and obligations of
every kind and nature, in law, equity, or otherwise, known and unknown,
suspected and unsuspected, disclosed and undisclosed (other than any claim for
indemnification I may have as a result of any third party action against me
based on my employment with the Company), arising out of or in any way related
to agreements, events, acts or conduct at any time prior to the date I execute
this Release, including, but not limited to: all such claims and demands
directly or indirectly arising out of or in any way connected with my employment
with the Company or the termination of that employment, including but not
limited to, claims of intentional and negligent infliction of emotional
distress, any and all tort claims for personal injury, claims or demands related
to salary, bonuses, commissions, stock, stock options, or any other ownership
interests in the Company, vacation pay, fringe benefits, expense reimbursements,
severance pay, or any other form of disputed compensation; claims pursuant to
any federal, state or local law or cause of action including, but not limited
to, the federal Civil Rights Act of 1964, as amended; the federal Age
Discrimination in Employment Act of 1967, as amended ("ADEA"); the federal
Employee Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; tort law; contract law; statutory law;
common law; wrongful discharge; discrimination; fraud; defamation; emotional
distress; and breach of the implied covenant of good faith and fair dealing;
provided, however, that nothing in this paragraph shall be construed in any way
to release the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or applicable law.
In giving this release, which includes claims that may be unknown to me at
present, I acknowledge that I have read and understand Section 1542 of the
California Civil Code which reads as follows: "A general release does not
extend to claims which the creditor does not know or suspect to exist in his
favor at the time of executing the release, which if known by him must have
materially affected his settlement with the debtor." I expressly waive and
relinquish all rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any unknown or
unsuspected claims I may have against the Company.
I acknowledge that I am knowingly and voluntarily waiving and releasing any
rights I may have under ADEA. I also acknowledge that the consideration given
under this Agreement for the waiver and release in the preceding paragraph
hereof is in addition to anything of value to which I was already entitled. I
further acknowledge that I have been advised by this writing, as required by the
ADEA, that: (A) my waiver and release do not apply to any rights or claims that
may arise on or after the date I execute this Release; (B) I have the right to
consult with an attorney prior to executing this Release; (C) I have twenty-one
(21) days to consider this Release (although I may choose to voluntarily execute
this Release earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release shall not be
effective until the date upon which the revocation period has expired, which
shall be the eighth day after this Release is executed by me.
By: /name/
Date: /date/
<PAGE>
EXHIBIT 10.73
PROMISSORY NOTE
$809,890.00 San Jose, California
August 9, 1999
At the times hereinafter stated, for value received, the undersigned
promises to pay Aspect Telecommunications Corporation, a California corporation
(the "Company"), or order, at its principal office the principal sum of Eight
Hundred Nine Thousand, Eight Hundred Ninety dollars ($809,890.00) with interest
from the date hereof at a rate of 6% per annum, compounded annually, on the
unpaid balance of said principal sum. Said principal and interest shall be due
and payable on the earlier of (i) August 9, 2004 or (ii) the next June 1/st/
following the date on which the undersigned ceases to be employed by the
Company. Notwithstanding the foregoing, if amounts have not yet become due and
payable under the preceding sentence, the undersigned shall make principal
payments of $312,445.00 on August 9, 2002 and $156,222.50 on August 9, 2003.
In addition to (and without limiting) the above, the undersigned
acknowledges that he is purchasing or has purchased 154,416 shares of capital
stock of PeopleSoft, Inc., and the undersigned agrees to notify the Company upon
any disposition of such shares. Further, the undersigned agrees that, in the
event of disposition of any of such shares (in one or more transactions), the
undersigned will repay to the Company, within 30 days of disposition, an amount
of principal under this Note equal to (A) the product of (x) $809,890.00 and (y)
a fraction, the numerator of which is the total shares disposed of to date and
the denominator of which is 154,416, minus (B) the principal amount of the Note
repaid prior to the date of disposition; provided, however, that if such formula
-------- -------
results in a negative number, no amount of principal must then be repaid
pursuant to this paragraph.
Principal and interest are payable in lawful money of the United States of
America, AT ANY TIME, THE PRIVILEGE IS RESERVED TO PAY MORE THAN THE SUM DUE.
Should suit be commenced to collect this Note or any portion thereof, such
sum as the Court may deem reasonable shall be added hereto as attorneys' fee.
The makers and endorsers have severally waived presentment for payment, protest,
notice of protest, and notice of non-payment of this Note.
This Note is full recourse.
/s/ Barry Wright
--------------------------
Barry Wright
<PAGE>
EXHIBIT 10.74
CASH BONUS AGREEMENT
--------------------
THIS CASH BONUS AGREEMENT ("Agreement") is entered into this 9th day of
August, 1999, by and between ASPECT TELECOMMUNICATIONS CORPORATION, a California
corporation ("Company") and BARRY WRIGHT ("Executive").
WHEREAS, the board of directors has determined that it is in Company's best
interests to enter into this Agreement for the purpose of retaining Executive as
a valued employee of Company and providing an incentive for him to maximize his
efforts on Company's behalf;
NOW, THEREFORE, Company and Executive agree as follows:
1. Payment of Cash Bonuses. Company agrees to pay Executive cash bonuses
-----------------------
in the following amounts on the following dates:
June 1, 2000 $ 38,000.00
June 1, 2001 $ 38,000.00
June 1, 2002 $ 349,000.00
June 1, 2003 $ 175,000.00
June 1, 2004 $ 166,000.00
provided that Executive continues to serve as an employee of Company as of the
applicable date.
2. Forfeiture of Future Cash Bonuses/Severance Benefits.
----------------------------------------------------
(a) If Executive's employment is terminated voluntarily or for Cause
(as defined in Executive's Employment Letter Agreement dated July 15, 1999),
prior to a bonus payment date specified in Section 1, then he shall not be
entitled to receive any further cash bonuses under this Agreement but shall be
entitled to retain such cash bonuses as have previously been paid to him.
(b) If Executive's employment is terminated involuntarily, other than
for Cause (as defined in Executive's Employment Letter Agreement dated July 15,
1999), or Executive's employment is terminated by Executive following a
Constructive Termination (as defined in Executive's Employment Letter Agreement
dated July 15, 1999) he shall be entitled to receive, on the June 1/st/ next
following such termination, a cash severance payment as follows,
<TABLE>
<S> <C> <C> <C>
if such termination is before June 1, 2002, $663,000.00
if such termination is after May 31, 2002 but before June 1, 2003 $331,000.00
if such termination is after May 31, 2003, but before June 1, 2004 $166,000.00
</TABLE>
and Executive shall be entitled to retain such cash bonuses as have previously
been paid to him.
<PAGE>
3. Tax Withholding. All payments under this Agreement shall be subject
---------------
to and net of all applicable federal, state and local tax withholding
requirements. In the event that Company shall satisfy its obligation hereunder
by setting off such obligation against an obligation of Executive to make a
payment to Company, Company shall be entitled to withhold all applicable
federal, state and local taxes from any other payments due to Executive, and
Executive shall be obligated to pay to the Company the amount of any such taxes.
4. Non-Transferability; Creditor Rights. Executive's right to receive
------------------------------------
cash bonuses under this Agreement may not be sold, pledged assigned
hypothecated, transferred, or disposed of in any manner. Executive shall have no
greater rights pursuant to this Agreement than that of a general unsecured
creditor of Company. Company shall have no obligation to set aside any property
to bind its obligations hereunder and Executive shall have no rights in any
particular property of Company as a result of the award hereunder.
5. Right of Set-Off. To the extent any payments Company is obligated to
----------------
make hereunder are less than amounts Executive has promised to pay to Company
(regardless of whether Executive's indebtedness is then due and payable to
Company by Executive), Company may satisfy any of its obligations hereunder by
setting off its obligations against Executive's indebtedness.
IN WITNESS WHEREOF, this Agreement is made and effective as of the
Effective Date.
ASPECT TELECOMMUNICATIONS
CORPORATION
By: /s/ James R. Carreker
------------------------------
Its: Chairman & CEO
-----------------------------
BARRY WRIGHT, an individual
/s/ Barry Wright
---------------------------------
<PAGE>
EXHIBIT 21.1
ASPECT COMMUNICATIONS CORPORATION
SUBSIDIARIES OF THE REGISTRANT--JURISDICTION OF INCORPORATION
Aspect Telecommunications AG Aspect Telecommunications Technology
Switzerland Ltd.
Cayman Islands
Aspect Communications A/S
Denmark Aspect Communications de Mexico
S. de R.L. de C.V.
Aspect Telecommunications B.V. Mexico
The Netherlands
Aspect Communications Workforce
Management Inc.
Aspect Communications Europe B.V.
The Netherlands United States
Aspect Telecommunications Canada Voicetek Corporation
Company United States
Canada
PakNetX Corporation
Aspect Telecommunications GmbH United States
Germany
Aspect Telecommunications
Aspect Communications K.K. International Corporation
Japan United States
Aspect Communications Ltd.
Hong Kong
Aspect Communications UK Ltd.
United Kingdom
Aspect Telecommunications NV
Belgium
Aspect Communications PTE (S) Ltd.
Singapore
Aspect Communications Pty. Ltd.
Australia
Application Specific Solutions for
Telecommunications SAS
France
<PAGE>
EXHIBIT 23.1
ASPECT COMMUNICATIONS CORPORATION
INDEPENDENT AUDITORS' CONSENT AND REPORT ON SCHEDULE
We consent to the incorporation by reference in Registration Statement Nos.
33-36437, 33-36438, 33-39243, 33-69010, 33-50048, 33-94810, 333-07407, 333-
24315, 333-38041, 333-53195, and 333-57545 on Form S-8 and Nos. 333-91681,
333-19893, 333-31381, 333-38909, 333-52093, 333-66461 and 333-74603 on Form S-
3 of Aspect Communications Corporation of our report dated January 22, 2000
(February 18, 2000 as to Note 16), incorporated by reference in this Annual
Report on Form 10-K of Aspect Communications Corporation for the year ended
December 31, 1999.
Our audits of the financial statements referred to in our aforementioned
report also included the financial statement schedule of Aspect Communications
Corporation, listed in Item 14(a)(2). This financial statement schedule is the
responsibility of the Company's management. Our responsibility is to express
an opinion based on our audits. In our opinion, such financial statement
schedule, when considered in relation to the basic financial statements taken
as a whole, presents fairly in all material respects the information set forth
therein.
/s/ Deloitte & Touche LLP
San Jose, California
March 29, 2000
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AND CONSOLIDATED STATEMENT OF INCOME INCLUDED IN THE
COMPANY'S FORM 10-K FOR THE PERIOD ENDING DECEMBER 31, 1999, AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> DEC-31-1999
<CASH> 84,826
<SECURITIES> 253,979
<RECEIVABLES> 84,318
<ALLOWANCES> 7,180
<INVENTORY> 16,636
<CURRENT-ASSETS> 450,054
<PP&E> 191,053
<DEPRECIATION> 111,656
<TOTAL-ASSETS> 636,212
<CURRENT-LIABILITIES> 136,792
<BONDS> 163,107
0
0
<COMMON> 155,277
<OTHER-SE> 175,922
<TOTAL-LIABILITY-AND-EQUITY> 636,212
<SALES> 282,342
<TOTAL-REVENUES> 489,112
<CGS> 92,991
<TOTAL-COSTS> 243,169
<OTHER-EXPENSES> 285,940
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,095
<INCOME-PRETAX> (41,215)
<INCOME-TAX> 12,364
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (28,851)
<EPS-BASIC> (0.60)
<EPS-DILUTED> (0.60)
</TABLE>
