-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BV9aY4enUJ8kNaQmUj+XPeF6thI3bmTKjB0B9w3LUnQNZ9NcK5zjAdVXjuJtQku9 0nyw0YBoZyE/yAoiCHar6Q== 0001012870-99-001318.txt : 19990430 0001012870-99-001318.hdr.sgml : 19990430 ACCESSION NUMBER: 0001012870-99-001318 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990429 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ASPECT TELECOMMUNICATIONS CORP CENTRAL INDEX KEY: 0000779390 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE & TELEGRAPH APPARATUS [3661] IRS NUMBER: 953962471 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-18391 FILM NUMBER: 99604336 BUSINESS ADDRESS: STREET 1: 1730 FOX DR CITY: SAN JOSE STATE: CA ZIP: 95131 BUSINESS PHONE: 4083252200 MAIL ADDRESS: STREET 1: 1730 FOX DRIVE CITY: SAN JOSE STATE: CA ZIP: 95131 10-Q 1 FORM 10-Q FOR QUARTER ENDED 3/31/99 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _______________ FORM 10-Q (Mark One) [x] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. For the quarterly period ended March 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 ASPECT TELECOMMUNICATIONS CORPORATION (Exact name of registrant as specified in its charter) California 94-2974062 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1730 Fox Drive, San Jose, California 95131-2312 (Address of principal executive offices and zip code) Registrant's telephone number: (408) 325-2200 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 ___ ----- The number of shares outstanding of the Registrant's Common Stock, $.01 par value, was 47,748,837 at April 23, 1999. ASPECT TELECOMMUNICATIONS CORPORATION INDEX
Description Page Number - ------------------------------------------------------------------------------------- ----------- Cover Page 1 Index 2 Part I: Financial Information Item 1: Financial Statements Condensed Consolidated Balance Sheets as of March 31, 1999 and December 31, 1998 3 Condensed Consolidated Statements of Operations for the Three Month Periods Ended March 31, 1999 and 1998 4 Condensed Consolidated Statements of Cash Flows for the Three Month Periods Ended March 31, 1999 and 1998 5 Notes to Condensed Consolidated Financial Statements 6 Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Item 3: Qualitative and Quantitative Disclosures About Financial Market Risk 14 Part II: Other Information Item 6: Exhibits and Reports on Form 8-K 15 Signature 16
2 ASPECT TELECOMMUNICATIONS CORPORATION Part I: Financial Information Item 1. Financial Statements CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share data)
March 31, December 31, 1999 1998 ----------- ----------- ASSETS (unaudited) ** Current assets: Cash and cash equivalents $ 74,304 $ 67,071 Short-term investments 134,431 129,040 Accounts receivable, net 96,224 132,818 Inventories 22,329 18,916 Other current assets 25,239 14,820 ---------- ------------ Total current assets 352,527 362,665 ========== ============ Property and equipment, net 68,999 69,192 Intangible assets, net 114,051 119,052 Other assets 9,499 9,750 ---------- ------------ Total assets $545,076 $560,659 ========== ============ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 14,969 $ 18,239 Current portion of notes payable 1,899 3,300 Accrued compensation and related benefits 18,709 21,049 Other accrued liabilities 35,721 34,729 Customer deposits and deferred revenue 36,525 27,171 ---------- ----------- Total current liabilities 107,823 104,488 Deferred taxes 3,660 4,270 Convertible subordinated debentures 156,036 153,744 Commitments and contingencies Shareholders' equity: Preferred stock, $.01 par value: 2,000,000 shares authorized, none outstanding -- -- Common stock, $.01 par value: 100,000,000 shares authorized, shares outstanding: 48,858,507 in 1999 and 49,309,383 in 1998 135,970 142,132 Accumulated other comprehensive loss (1,578) (420) Retained earnings 143,165 156,445 ---------- ---------- Total shareholders' equity 277,557 298,157 ---------- ---------- Total liabilities and shareholders' equity $ 545,076 $560,659 ========== ==========
** Derived from audited financial statements. See notes to the condensed consolidated financial statements. 3 ASPECT TELECOMMUNICATIONS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data - unaudited)
Three Months Ended March 31, ----------------------------- 1999 1998 ----------- ---------- Net revenues: Product $ 51,196 $ 77,332 Customer support 48,889 36,125 ---------- ---------- Total net revenues 100,085 113,457 ---------- ---------- Cost of revenues: Cost of product revenues 17,740 24,372 Cost of customer support revenues 35,654 24,170 ----------- ---------- Total cost of revenues 53,394 48,542 ----------- ---------- Gross margin 46,691 64,915 Operating expenses: Research and development 19,501 12,830 Selling, general and administrative 45,943 31,084 ----------- ---------- Total operating expenses 65,444 43,914 ----------- ---------- Income (loss) from operations (18,753) 21,001 Interest income (expense), net (219) 1,413 ----------- ---------- Income (loss) before income taxes (18,972) 22,414 (Provision) benefit for income taxes 5,692 (8,517) ----------- ---------- Net income (loss) $ (13,280) $ 13,897 =========== ========== Basic earnings (loss) per share ($0.27) $ 0.28 Weighted average shares outstanding 49,156 50,146 Diluted earnings (loss) per share ($0.27) $ 0.26 Weighted average shares outstanding- assuming dilution 49,156 53,071
See notes to the condensed consolidated financial statements. 4 ASPECT TELECOMMUNICATIONS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited - in thousands)
Three Months Ended March 31, ----------------------------- 1999 1998 -------------- ------------ Cash flows from operating activities: Net income (loss) ($13,280) $ 13,897 Reconciliation of net income to cash provided by operating activities: Depreciation and amortization 10,278 6,710 Noncash interest expense on debentures 2,292 -- Deferred taxes (1,666) 3,908 Changes in assets and liabilities: Accounts receivable 34,187 (7,928) Inventories (3,603) (978) Other current assets and other asset (7,974) (1,858) Accounts payable (3,307) 2,714 Accrued compensation and related benefits (3,519) 1,407 Accrued intellectual property settlement -- (14,000) Other accrued liabilities 1,287 (4,696) Customer deposits and deferred revenue 9,088 7,310 ------------ ------------ Cash provided by operating activities 23,783 6,486 Cash flows from financing activities: Repurchase of common stock (9,751) -- Other common stock transactions - net 3,530 2,192 Payment on note payable (1,401) (250) ------------ ------------ Cash provided by (used in) financing activities (7,622) 1,942 Cash flows from investing activities: Short-term investment purchases (35,110) (75,988) Short-term investment sales and maturities 29,718 28,915 Property and equipment purchases (5,084) (9,006) ------------ ------------ Cash used in investing activities (10,476) (56,079) Effect of exchange rate changes on cash and cash equivalents 1,548 1,168 ------------ ------------ Increase (decrease) in cash and cash equivalents 7,233 (46,483) Cash and cash equivalents: Beginning of period 67,071 106,046 ------------ ------------ End of period $ 74,304 $ 59,563 ============ ============
See notes to the condensed consolidated financial statements. 5 ASPECT TELECOMMUNICATIONS CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Basis of Presentation The consolidated financial statements include the accounts of Aspect Telecommunications Corporation (Aspect or the Company) and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles for annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 1999 are not necessarily indicative of the results that may be expected for the year ending December 31, 1999. For further information, refer to the consolidated financial statements and notes thereto included in the Company's 1998 Annual Report to Shareholders attached as an appendix to the Proxy Statement for the 1999 Annual Meeting of Shareholders. Inventories Inventories, stated at the lower of cost (first-in, first-out) or market, consist of: (in thousands) March 31, December 31, 1999 1998 --------- ------------ Raw materials $ 8,720 $ 9,494 Work in progress 4,514 4,829 Finished goods 9,095 4,593 ------- ------- Total $22,329 $18,916 ======= ======= Notes Payable A note relating to the 1995 acquisition of TCS was payable on October 31, 1998. In November 1998, $1.2 million was paid on this note and in February 1999 the Company paid an additional $1.4 million. Payment of the remaining $1.9 million on the note is being delayed pending resolution of various tax matters relating to periods prior to the Company's acquisition of TCS. Convertible Subordinated Debentures 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. These debentures are priced at a yield to maturity of 6% per annum and are convertible into Aspect Common Stock any time prior to maturity at a conversion rate of 8.713 shares per $1,000 principal amount. Holders can require Aspect to repurchase the debentures on August 10, 2003, August 10, 2008 and August 10, 2013 for cash; or at the election of Aspect, for Aspect Common Stock, if certain conditions are met. Aspect can redeem the debentures any time on or after August 10, 2003. The debentures are not secured by any Aspect assets and are subordinated in right of payment to all of Aspect senior indebtedness and effectively subordinated to the debt of the Company's subsidiaries. On October 30, 1998, the Company filed a registration statement 6 ASPECT TELECOMMUNICATIONS CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS with the Securities and Exchange Commission to register the debentures and shares of Aspect Common Stock issuable upon conversion for resale. The registration statement was declared effective on February 2, 1999. Per Share Information Basic earnings (loss) per share is computed using the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share further includes the dilutive impact of stock options. Basic and diluted earnings (loss) per share for the three months ended March 31 are calculated as follows (in thousands, except per share data):
Three Months Ended March 31 --------------------------- 1999 1998 -------------- ----------- Basic EPS: Weighted average shares outstanding 49,156 50,146 Net income (loss) ($13,280) $13,897 Basic earnings (loss) per share $ (0.27) $ 0.28 ========= ======= Diluted EPS: Weighted average shares outstanding 49,156 50,146 Dilutive effect of options -- 2,925 Weighted average shares issuable upon conversion of debt -- -- --------- ------- Total 49,156 53,071 Net income (loss) ($13,280) $13,897 Diluted earnings (loss) per share $ (0.27) $ 0.26 ========= =======
As of March 31, 1999, the Company had 0.7 million common stock options outstanding which could potentially dilute basic earnings per share in the future, but were excluded from the computation of diluted earnings per share for the three month period ended March 31, 1999 because inclusion of these shares would have had an anti-dilutive effect as the Company had a net loss for that period. Similarly, the Company had 8.7 million options outstanding that were excluded from the computation of diluted earnings per share as the exercise prices were greater than the average market price of the common shares for the three month period ended March 31, 1999. Additionally, as of March 31, 1999, there were 4.3 million shares of common stock issuable upon conversion of debentures. These shares and the effect of accrued interest expense on the debentures was not included in the calculation of diluted earnings per share for the three month period ended March 31, 1999 because this inclusion would have been anti-dilutive. Contingencies The Company is from time to time involved in litigation or claims that arise in the normal course of business. The Company does not expect that any current litigation or claims will have a material adverse effect on the Company's business, operating results, or financial condition. Comprehensive Income (Loss) In the first quarter of 1998, the Company adopted Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive Income," which requires an enterprise to report the change in net assets during the period from non- owner sources. For the three months ended March 31, 1999, comprehensive loss was 7 ASPECT TELECOMMUNICATIONS CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS $14,438,000. Comprehensive income for the same period of the prior year was $13,023,000. Comprehensive income (loss) represents net income (loss) for these periods and changes in unrealized gains on securities and accumulated translation adjustments. Share Repurchase Program In October 1998, the Company's Board of Directors approved a stock repurchase program to acquire up to five million shares of its common stock. The shares may be purchased in the open market or through private transactions. The number of shares to be purchased and the timing of purchases will be based on several conditions, including the price of the Company's common stock, general market conditions and other factors. No time limit was set for the completion of the program. In the quarter ended March 31, 1999, 1,250,000 shares were repurchased at an average acquisition price of $7.80 per share. A total of 3,260,000 shares have been repurchased to date under this program at an average acquisition price of $12.68 per share. The Company has retired all shares repurchased. 8 ASPECT TELECOMMUNICATIONS CORPORATION Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto included in Part I - Item 1 of this Quarterly Report and the audited consolidated financial statements and notes thereto and Management's Discussion and Analysis in the Company's 1998 Annual Report to Shareholders. Overview Aspect Telecommunications Corporation (Aspect or the Company) is a provider of integrated software suites designed to enable companies to deliver responsive and cost-effective customer service using call center solutions to interact with their customers via voice, data, the Internet, and e-mail. Aspect also consults, trains, and delivers systems integration services to help organizations effectively plan, integrate, and manage call centers. The Company markets its products and services worldwide to enterprises in a broad array of industries including financial services, government, health care, retailing, technology, telecommunications, and transportation. In May 1998, the Company completed the acquisition of Voicetek Corporation (Voicetek), a leading supplier of interactive voice response (IVR) and Intelligent Networks (IN) applications, based in Chelmsford, Massachusetts. The transaction was intended to augment Aspect customer premise IVR product offerings, strengthen the Company's position in the network service provider marketplace, and extend the Company's original equipment manufacturers (OEM) sales channel capabilities. The transaction was accounted for as a purchase. The Company paid approximately $72 million in cash for all Voicetek common and preferred shares outstanding and converted all outstanding Voicetek options into options to purchase approximately 450,000 shares of Aspect common stock with a fair value of approximately $11 million plus transaction costs of approximately $3 million, and assumed certain operating assets and liabilities. The Company recorded a one-time charge of $10 million in the second quarter of 1998 for purchased in-process technology related to two development projects that had not reached technological feasibility, had no alternative future use, and for which successful development was uncertain. The conclusion that each in-process development effort, or any material subcomponent, had no alternative future use was reached in consultation with engineering personnel from both Aspect and Voicetek. 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 (convertible subordinated debentures) due 2018. The convertible subordinated 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 share per $1,000 principal amount. Holders can require Aspect to repurchase the debentures on August 10, 2003, August 10, 2008 and August 10, 2013, for cash, or at the election of Aspect, for Aspect common stock, if certain conditions are met. The debentures are not secured by any Aspect assets and are subordinated in right of payment to all of Aspect senior indebtedness and effectively subordinated to the debt of Aspect subsidiaries. On October 30, 1998, the Company filed a registration statement with the Securities and Exchange Commission to register the debentures and shares of Aspect Common Stock issuable upon conversion for resale. The registration statement was declared effective on February 2, 1999. 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. See "Business Environment and Risk Factors" discussed in the Company's Annual Report and Form 10-K 9 ASPECT TELECOMMUNICATIONS CORPORATION for the fiscal year ended December 31, 1998. 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 which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Results of Operations Net Revenues Total revenues decreased by 12% to $100.1 million for the first quarter of 1999 from $113.5 million for the first quarter of 1998. Product revenues for the first quarter of 1999 were $51.2 million, a decrease of 34% from product revenues of $77.3 million for the first quarter of 1998 primarily due to a decline in revenue from sales of new call center systems and add-ons in the United States, partially offset by revenue associated with Voicetek. International product revenues in the first quarter of 1999 decreased modestly from the first quarter of the prior year reflecting increased revenue in Germany offset by a decline in the United Kingdom. Customer support revenues for the first quarter of 1999 were $48.9 million, an increase of 35% over support revenues of $36.1 million for the same period of 1998. Growth in customer support revenues resulted primarily from increases in maintenance revenues as a result of the growth in the Company's installed base, including the installed base added through acquisitions and expanded revenue from consulting and systems integration projects in North America. Customer support revenues include fees for providing contractually agreed-upon system service and maintenance (which typically commence twelve months from the date a system is installed and, accordingly, are primarily affected by growth in the installed base); installation of products; systems integration revenues; and other support services. Gross Margin on Product Revenues Product gross margin was 65.3% for the first quarter of 1999 compared to 68.5% for the first quarter of 1998. The decline in product gross margin from 1998 to 1999 primarily reflects the increased proportional impact of amortization and other fixed production costs due to decreased revenue, as well as an increased mix of revenue from third party products included as part of system integration projects in the most recent quarter (which typically have lower margins). On a forward-looking basis, the Company expects that the following factors, among others, could have a material impact on product gross margins: the shift in the Company's business focus to becoming a provider of customer relationship solutions; variations in the mix and volume of products sold; the channel of distribution; the portion of systems revenues related to accounts purchasing multiple systems; the mix and level of third-party product included as part of systems integration projects; the results of recently acquired subsidiaries; and cross-licensing or royalty arrangements with third parties. Gross Margin on Customer Support Revenues Customer support gross margin was 27.1% for the first quarter of 1999 compared to 33.1% for the first quarter of 1998. The decrease in customer support margins between the periods reflects customer support revenues not growing proportionately with the costs associated with providing the related services, in particular costs associated with consulting and systems integration projects. On a forward-looking basis, the Company anticipates that customer support margins will fluctuate from period to period due to fluctuations in customer support revenues (since many of the costs of providing customer support do 10 ASPECT TELECOMMUNICATIONS CORPORATION not vary proportionately with customer support revenues), ongoing efforts to expand the Company's customer support infrastructure and fluctuations in the level of consulting and systems integration revenue. Research and Development Expenses Research and development (R&D) expenses were $19.5 million for the first quarter of 1999, an increase of 52% over $12.8 million for the first quarter of 1998. R&D expenditures reflect the Company's ongoing efforts to remain competitive through both new product development and expanded features for existing products. The increases across the period presented reflect increased staffing, associated infrastructure costs, and the inclusion of Voicetek's R&D expenses in 1999, including amortization costs associated with developed and core technology intangible assets. As a percentage of net revenues, R&D spending was 19% for the first quarter of 1999 compared to 11% for the first quarter of 1998. Excluding amortization of acquired intangible assets, R&D expenses were $18.4 million for the first quarter of 1999 while the same period of 1998 did not include similar expenses. The Company continues to believe that significant investment in R&D is required to remain competitive and anticipates, on a forward-looking basis, that such expenses in 1999 will increase in absolute dollars, although such expenses as a percentage of net revenues may fluctuate between periods. Selling, General and Administrative Expenses Selling, general and administrative (SG&A) expenses were $45.9 million for the first quarter of 1999, an increase of 48% over $31.1 million in the first quarter of 1998. The increase between these two periods was primarily caused by increased staffing levels, infrastructure expansion, and increased amortization expenses related to the acquisition of Voicetek, partially offset by a decline in legal expenses. SG&A expenses as a percentage of net revenues were 46% for the first quarter of 1999 and 27% for the first quarter of 1998. Excluding amortization of acquired intangible assets, SG&A expenses were $43.1 million and $30.1 million for the first quarters of 1999 and 1998, respectively. The Company anticipates, on a forward-looking basis, that SG&A expenses will continue to increase in absolute dollars for 1999, when compared with 1998, although such expenses as a percentage of net revenues may fluctuate between periods. Net Interest Income (Expense) Net interest expense was $219,000 for the three months ended March 31, 1999 compared to net interest income of $1.4 million for the three months ended March 31, 1998. This decline resulted from interest expense associated with the issuance of approximately $150 million of convertible subordinated debentures in August 1998 (approximately $156 million in principal and accrued interest at March 31, 1999), the utilization of cash associated with the Company's stock repurchase program and generally lower interest rates earned on invested cash. Income Taxes The Company's effective tax rate was a benefit of 30% for the first three months of 1999 compared with a provision of 38% in the same period of 1998. The rate in 1999 is lower primarily due to the nondeductible goodwill amortization from prior years' acquisitions which reduces the amount of tax benefit that can be recognized in a loss period. The Company has sufficient prior year taxable income to allow recognition of the tax benefit. Liquidity and Capital Resources At March 31, 1999, the Company's principal source of liquidity consisted of cash, cash equivalents, and short-term investments totaling $208.7 million, which represented 38% of total assets. The primary sources 11 ASPECT TELECOMMUNICATIONS CORPORATION of cash for the first three months of 1999 were cash provided by operating activities of $23.8 million and proceeds from the issuance of common stock under various stock plans of $3.5 million. The primary uses of cash for the first three months of 1999 were net purchases of short-term investments of $5.4 million, $9.8 million used for the stock repurchase program, $5.1 million for the purchase of property and equipment, and $1.4 million for payments on a note payable. At March 31, 1999, the Company's outstanding borrowings, including current portions of notes payable, totaled $158 million, and comprised $156 million of convertible subordinated debentures and $1.9 million remaining on a $4.5 million note payable incurred in connection with the acquisition of TCS in 1995. Payment of the remaining balance is being delayed pending resolution of various tax matters relating to periods prior to the Company's acquisition of TCS. The Company believes, on a forward-looking basis, that its cash, cash equivalents, short-term investments, and anticipated cash flow from operations will be sufficient to meet the Company's presently anticipated cash requirements during at least the next twelve months. Year 2000 and Proximate Dates The information provided below constitutes a "Year 2000 Readiness Disclosure" for purposes of the Year 2000 Readiness Disclosure Act. Many computer systems are expected to experience problems handling dates around the Year 2000 (Y2K). Described below are the actions we have taken or plan to take to address the potential problems that could result as systems attempt to handle dates around the millennium. State of Readiness: The Company's Y2K activities include the following phases: gathering data and taking inventory; testing systems and products to discover or confirm Y2K compliance; execution of remediation activities to fix non-compliant products and systems; and ongoing monitoring and testing of products and systems. The major business areas impacted are as follows: . Products and Installations: The Company is visiting customers to install Y2K solutions and has furnished test facilities and equipment to allow customers to verify compliance. The Company believes that substantially all of the Company's products are Y2K compliant, or that upgrades available to make them Y2K compliant. . Procurement: The Company has surveyed the Y2K readiness of critical and sole- source suppliers. The Company is monitoring these critical suppliers and will continue to follow up with them on their Y2K readiness. Risk assessments and contingency plans are being prepared for critical suppliers. . Manufacturing: Certain of the Company's manufacturing is outsourced to two primary suppliers and the Company is monitoring their Y2K readiness. The Company's assembly and test equipment is scheduled for ongoing upgrades to Y2K compliant configurations through September 1999. The Company's primary manufacturing application software has been upgraded to a version that has successfully passed Y2K testing. . Information Technology Systems: The Company has conducted a survey of its information technology hardware and software and has a Y2K project team focusing on testing and remediation of necessary components. The Company expects that substantially all nonY2K compliant hardware and software will be upgraded or replaced by September 1999. . Facilities and Infrastructure: An assessment of the Y2K readiness of owned and leased assets was substantially completed in January 1999. The Company is currently confirming compliance status and upgrading components as necessary. The Company anticipates that substantially all non-Y2K compliant facilities components will be upgraded or replaced by September 1999. 12 ASPECT TELECOMMUNICATIONS CORPORATION Costs: The estimated costs of Y2K compliance efforts are not expected to be material to the Company. Risks: Many computer systems are expected to experience problems handling dates around the year 2000. The Company believes the most reasonably likely worst case Y2K scenarios include the following: . Customers could change their buying patterns in a number of ways, including accelerating or delaying purchases of, or replacement of, the Company's products and services. . The Company could experience a disruption in service to its customers as a result of the failure of third party products, including the following: -Third party products which are non-compliant and are incorporated into the Company's products could cause such products to fail; -A breakdown in telephone, e-mail, voicemail, Web or file transfer programs could impact the responsiveness of the Company's help desk; -Y2K problems at a number of the Company's suppliers including banks, telephone companies and transport and mail services could have a pervasive impact on business as a whole; and/or -Product features that rely on date parameters, such as scheduled operating procedures and operating reports, could malfunction. The Company's products may not contain all of the necessary date code or other changes to operate in the Y2K. Any failure of such products to perform could result in: . Claims and lawsuits against the Company; . Significantly impaired customer satisfaction resulting in customers withholding cash owed to the Company and delaying or canceling orders; and/or . Managerial and technical resources being diverted away from product development and other business activities. Any of the above stated consequences, in addition to others that management cannot yet foresee, could have a significant adverse impact on the Company's business, operating results or financial condition. Contingency Plans: The Company is currently developing contingency plans for critical business processes, suppliers, and systems. The Company presently anticipates that contingency plans will be complete by October 1999. Once contingency plans are implemented, however, management cannot be certain that such plans will prevent significant Y2K problems from occurring. 13 ASPECT TELECOMMUNICATIONS CORPORATION Item 3. Quantitative and Qualitative Disclosures About Financial Market Risk Reference is made to the information appearing under the caption "Quantitative and Qualitative Disclosures About Financial Market Risk" on pages F-11 through F-12 of the Registrant's 1998 Annual Financial Report to Shareholders attached as an appendix to the Registrant's 1999 Proxy Statement, which information is hereby incorporated by reference. 14 ASPECT TELECOMMUNICATIONS CORPORATION Part II: Other Information Item 6. Exhibits and Reports on Form 8-K A. Exhibits Exhibit 10.59 Severance Agreement between the Registrant and Robert A. Blatt, dated March 25, 1999 Exhibit 10.60 Employment Agreement between the Registrant and Deborah E. Barber, dated March 1, 1999. Exhibit 10.61 Employment Agreement between the Registrant and James R. Carreker, dated March 1, 1999. Exhibit 10.62 Employment Agreement between the Registrant and Kathleen M. Cruz, dated March 1, 1999. Exhibit 10.63 Employment Agreement between the Registrant and Beatriz V. Infante, dated March 1, 1999. Exhibit 27 Financial Data Schedule B. Reports on Form 8-K No reports on Form 8-K filed during the quarter ended March 31, 1999 15 ASPECT TELECOMMUNICATIONS CORPORATION SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Aspect Telecommunications Corporation (Registrant) Date: April 29, 1999 By /s/ Eric J. Keller ------------------- Eric J. Keller Senior Vice President, Finance and Chief Financial and Accounting Officer (Duly Authorized and Principal Financial and Accounting Officer) 16 EX-10.59 2 SEVERANCE AGREEMENT [Aspect Letterhead] EXHIBIT 10.59 March 25, 1999 Robert A. Blatt 4262 Newberry Court Palo Alto, CA 94602 Dear Robert: This letter is to confirm the agreement between you and Aspect Telecommunications Corporation ("Aspect" or the "Company") regarding your separation from employment with the Company. You will resign your position as an officer of the Company effective March 31, 1999. Commencing on March 31, 1999 and continuing through and until the earlier of: (a) September 30, 1999, 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, not to exceed 40 hours a month. During the Transition Period, Aspect will pay you a monthly salary of $18,750, less applicable withholdings and any other employee benefits that you are eligible to receive with the following exceptions: after March 31, 1999, you will not be eligible to participate in the accrual of flexible time off hours and the Employee Incentive Plan. You agree that, except for any compensation, if any, you may have earned during the first quarter of 1999 under the Executive Incentive Plan, the only payments and benefits that you are entitled to receive from the Company in the future are those specified in this letter. 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 September 30, 1999. In consideration for receiving the Transition Period payments and outplacement services described above, 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. Robert Blatt 03/31/99 Page2 You expressly waive and release any and all rights and benefits under 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." 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. At all times in the future, you will remain bound by Aspect's Proprietary Information and Invention 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 agrees not to engage in any conduct or communications, whether written or verbal , which could be injurious to your personal or professional reputation. 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. 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. You may not disclose to others the fact 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, and you may also disclose such information to your spouse. Based on information provided by Aspect's stock administrator, and assuming no stock option exercises from this date until March 31, 1999, 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 234,636 shares (the "Options"). It is expected that as of September 30, 1999, 184,633 shares of these options will be vested and 50,003 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. Robert Blatt 03/25/99 Page 3 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. 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, President 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. /s/ Robert A. Blatt Dated: March 31, 1999 ______________________________ Robert A. Blatt EX-10.60 3 EMPLOYMENT AGMT. BETWEEN REGISTRANT & BARBER EXHIBIT 10.60 [ASPECT LETTERHEAD] March 1, 1999 Deborah E. Barber Sr. Vice President, Human Resources & Corporate Services Dear Deborah: This letter agreement (the "Agreement") is to confirm the terms of your ongoing employment with Aspect Telecommunications Corporation (the "Company"). 1. This Agreement will commence on the date hereof and continue for a term of two (2) years (the "Original Term"), unless extended for one or more ------------- additional one-year terms upon mutual written agreement of the parties or unless terminated pursuant to the terms described herein. In the event that the Company has entered into discussions with a third party regarding a Change of Control (as defined below) transaction and such Change of Control discussions are ongoing at the end of the Original Term, this Agreement shall be automatically extended pending consummation of such transaction. 2. You are employed as Sr. Vice President, Human Resources & Corporate Services 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 of Directors (the "Board"), at all times loyally and conscientiously perform all of the duties and obligations required of you pursuant to the terms of this Agreement. You will comply with and be bound by the Company's operating policies, procedures and practices from time to time in effect 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. 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. The rights and duties created by this paragraph may not be modified in any way except by a written agreement executed by 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 within twelve (12) months of a Change of Control (as defined below), you will be entitled to receive payment of severance benefits equal to your regular monthly salary (subject to any applicable tax withholding) until the earlier of (i) twelve (12) months following the termination date or (ii) the date on which you commence comparable employment (as defined below) with another employer (the "Severance Period"). Such payments will be made ratably over the Severance Period according to the Company's standard payroll schedule. Health insurance benefits with the same coverage provided to you prior to the termination (e.g. medical, dental, optical, mental health) and in all other respects significantly comparable to those in place immediately prior to the termination will be provided at the Company's cost over the Severance Period. In addition, and except as otherwise determined below, each stock option and share of restricted stock you hold that is not otherwise fully exercisable or vested (released from the Company's repurchase option) as of the termination date shall become immediately exercisable or vested in full as of such date. 5. In the event it is determined by the Board, upon consultation with Company management and the Company's independent auditors, that the enforcement of paragraph 5 of this Agreement, which allows for the acceleration of vesting of option shares and restricted stock upon an involuntary or constructive termination following a Change of Control, would preclude accounting for any proposed business combination of the Company involving a Change of Control as a pooling of interests, and the Board otherwise desires to approve such a proposed business transaction which requires as a condition to the closing of such transaction that it be accounted for as a pooling of interests, then such paragraph shall be null and void. For purposes of this paragraph, the Board's determination shall require the unanimous approval of the non-employee Board members. 6. In the event that the severance and other benefits provided to you by this Agreement constitute "parachute payments" within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the "Code") and, but for this paragraph, would be subject to the excise tax imposed by Section 4999 of the Code, the Company shall reduce the aggregate amount of such payments and benefits such that the present value thereof (as determined under the Code and the applicable regulations) is equal to 2.99 times your "base amount" as defined in Section 280G(b)(3) of the Code. The payment of severance and other benefits provided for in this Agreement shall be subject to all applicable income and employment tax rules and regulations. 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 substantially to perform your duties hereunder (other than any such failure due to your physical or mental illness), and such willful failure is not remedied within 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 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 contender to a crime that constitutes a felony, 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 10 business days after written notice from the Company's Chief Executive Officer, which written -2- notice shall state that failure to remedy such conduct may result in an involuntary termination for cause. (b) "Change of Control" will mean the occurrence of any of the ----------------- following events: (i) 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) or (ii) a sale of all or substantially all of the assets of the Company (collectively, a "Merger"), so long as in either case the Company's shareholders ------ of record immediately prior to such Merger will, immediately after such Merger, hold less than 50% of the voting power of the surviving or acquiring entity. (c) "Comparable Employment" will mean employment or consulting that --------------------- provides compensation, benefits and duties that, in the sole discretion of the Board, are deemed to be generally comparable to those pertaining to your position with the Company at the time of termination of your employment. (d) "Constructive Termination" will be deemed to occur if (A) (i) ------------------------ your duties and responsibilities as Sr. Vice President, Human Resources & Corporate Services of the company are materially diminished without your prior written consent; and/or (ii) any reduction in the total value of your base compensation and benefits occurs; and/or (iii) your new business office location is more than 50 miles or greater than current commute (whichever is greater) from your current business office location. Construction termination does not occur when your reduction in duties, position or responsibilities solely results by virtue of the company being acquired and made a part of a larger entity; and (B) within sixty (60) days immediately following such material change in duties or reduction or refusal to relocate you elect to terminate your employment voluntarily. 8. You have signed a Confidential Information and Invention Assignment 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. You represent that your performance of all the terms of this Agreement will not breach any other agreement to which you are a party. You have not, and will not during the term of this Agreement, enter into any oral or written agreement in conflict with any of the provisions of this Agreement. 10. Any successor to the Company (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company's business and/or assets will assume the obligations under this Agreement and agrees expressly to perform the obligations under this Agreement in the same manner and to the same -3- extent as the Company would be required to perform such obligations in the absence of a succession. The terms of this Agreement and all of your rights hereunder will inure to the benefit of, and be enforceable by, your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. 11. This Agreement, including any Exhibits hereto, constitutes the sole agreement of the parties and supersedes all oral negotiations and prior writings with respect to the subject matter hereof. 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 or by a nationally-recognized delivery service (such as Federal Express or UPS), or 48 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 renegotiate 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, (ii) the balance of the Agreement will be interpreted as if such provision were so excluded 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. The Company agrees to pay, on a monthly basis, the reasonable attorney fees, costs and expenses (as determined by the arbitrator) incurred by you in good faith in connection with the arbitration, regardless of the outcome. You agree that punitive damages will not be awarded. This paragraph will not apply to the Confidentiality Agreement. -4- 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 Telecommunications Corporation /s/ James R. Carreker By:_______________________________ Title: Chairman, President & Chief Executive Officer My agreement with the above terms is signified by my signature below. /s/ Deborah E. Barber ---------------------------- Deborah E. Barber -5- EXHIBIT A --------- DESCRIPTION OF JOB DUTIES AND RESPONSIBILITIES Senior Vice President Human Resources and Corporate Services- Deborah E. Barber - -------------------------------------------------------------------------------- This position is responsible for overseeing the activities of Human Resources and Facilities and Corporate Services functions. These functions encompass world-wide responsibilities for program design and implementation of policy and programs that are cost effective, competitive and conform to applicable local standards and regulations. EXHIBIT B --------- CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT 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 AT WILL I agree that this Agreement is not an employment contract and that I have the right to resign and the Company has the right to terminate my employment at any time, for any reason, with or without cause. This is the full and complete agreement between myself and the Company and no employee or representative of the Company has any authority to enter into any agreement to the contrary. 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 written 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 INVENTIONS Without further compensation, I hereby assign and agree to assign to the Company or its designee, my entire right, title, and interest in and to all Inventions made by me during the period of my employment, unless the Invention was developed entirely on my own time without using the Company's equipment, supplies, facilities, or trade secret information; and (a) the Invention does not relate at the time of conception or reduction to practice of the Invention to the Company's business, or the Company's actual or demonstrably anticipated research or development; and, (b) the Invention does not result from any work performed by me for 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 a sheet attached to and made a part of this Agreement, if any. 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. 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 NONDISCLOSURE I agree to hold in confidence and not directly or indirectly to 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. 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 SOLICITATION I agree that for a period of twelve (12) months immediately following the termination of my relationship with the Company for any reason, I shall not either directly or indirectly solicit, induce, recruit or encourage any of the Company's employees to leave their employment or attempt to solicit, induce, encourage or recruit employees of the Company, either for myself or for any other person or entity. 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 assignees 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. EMPLOYEE Deborah E Barber /s/ Deborah E Barber ----------------------- ----------------------- Print Name Signature April 13, 1998 ----------------------- Date ASPECT TELECOMMUNICATIONS CORPORATION Jen Rios /s/ Jen Rios ----------------------- ----------------------- Print Name Signature Ben Analyst ----------------------- Title EX-10.61 4 EMPLOYMENT AGMT. BETWEEN REGISTRANT & CARREKER Exhibit 10.61 [ASPECT LETTERHEAD] March 1, 1999 James R. Carreker Chairman, President & Chief Executive Officer Dear Jim: This letter agreement (the "Agreement") is to confirm the terms of your ongoing employment with Aspect Telecommunications Corporation (the "Company"). 1. This Agreement will commence on the date hereof and continue for a term of two (2) years (the "Original Term"), unless extended for one or more ------------- additional one-year terms upon mutual written agreement of the parties or unless terminated pursuant to the terms described herein. In the event that the Company has entered into discussions with a third party regarding a Change of Control (as defined below) transaction and such Change of Control discussions are ongoing at the end of the Original Term, this Agreement shall be automatically extended pending consummation of such transaction. 2. You are employed as Chairman, President & Chief Executive Officer of the Company, and as such report to the Company's Board of Directors. 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 of Directors (the "Board"), at all times loyally and conscientiously perform all of the duties and obligations required of you pursuant to the terms of this Agreement. You will comply with and be bound by the Company's operating policies, procedures and practices from time to time in effect 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. 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. The rights and duties created by this paragraph may not be modified in any way except by a written agreement executed by 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 within twelve (12) months of a Change of Control (as defined below), you will be entitled to receive payment of severance benefits equal to your regular monthly salary (subject to any applicable tax withholding) until the earlier of (i) twelve (12) months following the termination date or (ii) the date on which you commence comparable employment (as defined below) with another employer (the "Severance Period"). Such payments will be made ratably over the Severance Period according to the Company's standard payroll schedule. Health insurance benefits with the same coverage provided to you prior to the termination (e.g. medical, dental, optical, mental health) and in all other respects significantly comparable to those in place immediately prior to the termination will be provided at the Company's cost over the Severance Period. In addition, and except as otherwise determined below, each stock option and share of restricted stock you hold that is not otherwise fully exercisable or vested (released from the Company's repurchase option) as of the termination date shall become immediately exercisable or vested in full as of such date. 5. In the event it is determined by the Board, upon consultation with Company management and the Company's independent auditors, that the enforcement of paragraph 4 of this Agreement, which allows for the acceleration of vesting of option shares and restricted stock upon an involuntary or constructive termination following a Change of Control, would preclude accounting for any proposed business combination of the Company involving a Change of Control as a pooling of interests, and the Board otherwise desires to approve such a proposed business transaction which requires as a condition to the closing of such transaction that it be accounted for as a pooling of interests, then such paragraph shall be null and void. For purposes of this paragraph, the Board's determination shall require the unanimous approval of the non-employee Board members. 6. In the event that the severance and other benefits provided to you by this Agreement constitute "parachute payments" within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the "Code") and, but for this paragraph, would be subject to the excise tax imposed by Section 4999 of the Code, the Company shall reduce the aggregate amount of such payments and benefits such that the present value thereof (as determined under the Code and the applicable regulations) is equal to 2.99 times your "base amount" as defined in Section 280G(b)(3) of the Code. The payment of severance and other benefits provided for in this Agreement shall be subject to all applicable income and employment tax rules and regulations. 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 substantially to perform your duties hereunder (other than any such failure due to your physical or mental illness), and such willful failure is not remedied within 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 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 contender to a crime that constitutes a felony, 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 10 business days after written notice from the Company's Chief Executive Officer, which written -2- notice shall state that failure to remedy such conduct may result in an involuntary termination for cause. (b) "Change of Control" will mean the occurrence of any of the ----------------- following events: (i) 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) or (ii) a sale of all or substantially all of the assets of the Company (collectively, a "Merger"), so long as in either case the Company's shareholders ------ of record immediately prior to such Merger will, immediately after such Merger, hold less than 50% of the voting power of the surviving or acquiring entity. (c) "Comparable Employment" will mean employment or consulting that --------------------- provides compensation, benefits and duties that, in the sole discretion of the Board, are deemed to be generally comparable to those pertaining to your position with the Company at the time of termination of your employment. (d) "Constructive Termination" will be deemed to occur if (A) (i) ------------------------ your duties and responsibilities as Chairman, President & Chief Executive Officer of the company are materially diminished without your prior written consent; and/or (ii) any reduction in the total value of your base compensation and benefits occurs; and/or (iii) your new business office location is more than 50 miles or greater than current commute (whichever is greater) from your current business office location. Construction termination does not occur when your reduction in duties, position or responsibilities solely results by virtue of the company being acquired and made a part of a larger entity; and (B) within sixty (60) days immediately following such material change in duties or reduction or refusal to relocate you elect to terminate your employment voluntarily. 8. You have signed a Confidential Information and Invention Assignment 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. You represent that your performance of all the terms of this Agreement will not breach any other agreement to which you are a party. You have not, and will not during the term of this Agreement, enter into any oral or written agreement in conflict with any of the provisions of this Agreement. 10. Any successor to the Company (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company's business and/or assets will assume the obligations under this Agreement and agrees expressly to perform the obligations under this Agreement in the same manner and to the same -3- extent as the Company would be required to perform such obligations in the absence of a succession. The terms of this Agreement and all of your rights hereunder will inure to the benefit of, and be enforceable by, your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. 11. This Agreement, including any Exhibits hereto, constitutes the sole agreement of the parties and supersedes all oral negotiations and prior writings with respect to the subject matter hereof. 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 or by a nationally-recognized delivery service (such as Federal Express or UPS), or 48 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 renegotiate 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, (ii) the balance of the Agreement will be interpreted as if such provision were so excluded 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. The Company agrees to pay, on a monthly basis, the reasonable attorney fees, costs and expenses (as determined by the arbitrator) incurred by you in good faith in connection with the arbitration, regardless of the outcome. You agree that punitive damages will not be awarded. This paragraph will not apply to the Confidentiality Agreement. -4- 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 Telecommunications Corporation By: /s/ Deborah E. Barber __________________________________________ Title: Sr. Vice President, Human Resources & Corporate Services My agreement with the above terms is signified by my signature below. /s/ James R. Carreker ------------------------ James R. Carreker -5- EXHIBIT A --------- DESCRIPTION OF JOB DUTIES AND RESPONSIBILITIES Chairman, President and CEO - James R. Carreker This position is responsible for overseeing all corporate functions and directing the company to ensure attainment of sales and profit goals and maximum return on invested capital. Subject to the approval of the Board of Directors, the position is responsible for the formulation of current and long-range plans and objectives, and represents the organization in relations with its customers and all of its stakeholders. EXHIBIT B - --------- CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT -2- 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: 1. 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 or in any activities detrimental to the best interests of the Company without the prior written consent of the Company. 2. 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. 3. 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. 4. Without further compensation, I hereby agree promptly to 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 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. 5. 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 Inven- tions hereby assigned to the Company as set forth in paragraph 4 above. Such acts may include, but are not limited to, execution of documents and assistance or cooperation in legal proceedings. 6. I agree to hold in confidence and not directly or indirectly to 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. 7. 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. I agree not to enter into any agreement either written or oral in conflict with the provisions of this Agreement. 8. 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 assignees of the Company, and (d) is binding upon my heirs and legal representatives. 9. This Agreement does not apply to an Invention, the assignment of which to the Company would violate applicable law. I agree to disclose all Inventions made by me in confidence to the Company to permit a determination as to whether or not the Inventions should be the property of the Company. 10. 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. 11. 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 Craig W. Johnson By James R Carreker --------------------- ---------------------- Title Secretary Dated: 9/20/85 ------------------ ------------------ -2- ATTACHMENT ---------- List of Inventions ------------------ EX-10.62 5 EMPLOYMENT AGMT. BETWEEN REGISTRANT & CRUZ EXHIBIT 10.62 [ASPECT LETTERHEAD] March 1, 1999 Kathleen M. Cruz Sr. Vice President, Information Technology & Chief Information Officer Dear Kathy: This letter agreement (the "Agreement") is to confirm the terms of your ongoing employment with Aspect Telecommunications Corporation (the "Company"). 1. This Agreement will commence on the date hereof and continue for a term of two (2) years (the "Original Term"), unless extended for one or more ------------- additional one-year terms upon mutual written agreement of the parties or unless terminated pursuant to the terms described herein. In the event that the Company has entered into discussions with a third party regarding a Change of Control (as defined below) transaction and such Change of Control discussions are ongoing at the end of the Original Term, this Agreement shall be automatically extended pending consummation of such transaction. 2. You are employed as Sr. Vice President, Information Technology & Chief Information Officer 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 of Directors (the "Board"), at all times loyally and conscientiously perform all of the duties and obligations required of you pursuant to the terms of this Agreement. You will comply with and be bound by the Company's operating policies, procedures and practices from time to time in effect 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. 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. The rights and duties created by this paragraph may not be modified in any way except by a written agreement executed by 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 within twelve (12) months of a Change of Control (as defined below), you will be entitled to receive payment of severance benefits equal to your regular monthly salary (subject to any applicable tax withholding) until the earlier of (i) twelve (12) months following the termination date or (ii) the date on which you commence comparable employment (as defined below) with another employer (the "Severance Period"). Such payments will be made ratably over the Severance Period according to the Company's standard payroll schedule. Health insurance benefits with the same coverage provided to you prior to the termination (e.g. medical, dental, optical, mental health) and in all other respects significantly comparable to those in place immediately prior to the termination will be provided at the Company's cost over the Severance Period. In addition, and except as otherwise determined below, each stock option and share of restricted stock you hold that is not otherwise fully exercisable or vested (released from the Company's repurchase option) as of the termination date shall become immediately exercisable or vested in full as of such date. 5. In the event it is determined by the Board, upon consultation with Company management and the Company's independent auditors, that the enforcement of paragraph 4 of this Agreement, which allows for the acceleration of vesting of option shares and restricted stock upon an involuntary or constructive termination following a Change of Control, would preclude accounting for any proposed business combination of the Company involving a Change of Control as a pooling of interests, and the Board otherwise desires to approve such a proposed business transaction which requires as a condition to the closing of such transaction that it be accounted for as a pooling of interests, then such paragraph shall be null and void. For purposes of this paragraph, the Board's determination shall require the unanimous approval of the non-employee Board members. 6. In the event that the severance and other benefits provided to you by this Agreement constitute "parachute payments" within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the "Code") and, but for this paragraph, would be subject to the excise tax imposed by Section 4999 of the Code, the Company shall reduce the aggregate amount of such payments and benefits such that the present value thereof (as determined under the Code and the applicable regulations) is equal to 2.99 times your "base amount" as defined in Section 280G(b)(3) of the Code. The payment of severance and other benefits provided for in this Agreement shall be subject to all applicable income and employment tax rules and regulations. 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 substantially to perform your duties hereunder (other than any such failure due to your physical or mental illness), and such willful failure is not remedied within 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 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 contender to a crime that constitutes a felony, 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 10 business days after written notice from the Company's Chief Executive Officer, which written -2- notice shall state that failure to remedy such conduct may result in an involuntary termination for cause. (b) "Change of Control" will mean the occurrence of any of the ----------------- following events: (i) 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) or (ii) a sale of all or substantially all of the assets of the Company (collectively, a "Merger"), so long as in either case the Company's shareholders ------ of record immediately prior to such Merger will, immediately after such Merger, hold less than 50% of the voting power of the surviving or acquiring entity. (c) "Comparable Employment" will mean employment or consulting that --------------------- provides compensation, benefits and duties that, in the sole discretion of the Board, are deemed to be generally comparable to those pertaining to your position with the Company at the time of termination of your employment. (d) "Constructive Termination" will be deemed to occur if (A) (i) ------------------------ your duties and responsibilities as Sr. Vice President, Information Technology & Chief Information Officer of the company are materially diminished without your prior written consent; and/or (ii) any reduction in the total value of your base compensation and benefits occurs; and/or (iii) your new business office location is more than 50 miles or greater than current commute (whichever is greater) from your current business office location. Construction termination does not occur when your reduction in duties, position or responsibilities solely results by virtue of the company being acquired and made a part of a larger entity; and (B) within sixty (60) days immediately following such material change in duties or reduction or refusal to relocate you elect to terminate your employment voluntarily. 8. You have signed a Confidential Information and Invention Assignment 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. You represent that your performance of all the terms of this Agreement will not breach any other agreement to which you are a party. You have not, and will not during the term of this Agreement, enter into any oral or written agreement in conflict with any of the provisions of this Agreement. 10. Any successor to the Company (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company's business and/or assets will assume the obligations under this Agreement and agrees expressly to perform the obligations under this Agreement in the same manner and to the same -3- extent as the Company would be required to perform such obligations in the absence of a succession. The terms of this Agreement and all of your rights hereunder will inure to the benefit of, and be enforceable by, your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. 11. This Agreement, including any Exhibits hereto, constitutes the sole agreement of the parties and supersedes all oral negotiations and prior writings with respect to the subject matter hereof. 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 or by a nationally-recognized delivery service (such as Federal Express or UPS), or 48 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 renegotiate 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, (ii) the balance of the Agreement will be interpreted as if such provision were so excluded 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. The Company agrees to pay, on a monthly basis, the reasonable attorney fees, costs and expenses (as determined by the arbitrator) incurred by you in good faith in connection with the arbitration, regardless of the outcome. You agree that punitive damages will not be awarded. This paragraph will not apply to the Confidentiality Agreement. -4- 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 Telecommunications Corporation /s/ James R. Carreker By:____________________________ Title: Chairman, President & Chief Executive Officer My agreement with the above terms is signified by my signature below. /s/ Kathleen M. Cruz ---------------------- Kathleen M. Cruz -5- EXHIBIT A --------- DESCRIPTION OF JOB DUTIES AND RESPONSIBILITIES Senior Vice President and Chief Information Officer- Kathleen M. Cruz - --------------------------------------------------------------------- This position is responsible for directing the organization's internal information systems function and data processing functions, including all systems design, systems programming, application programming and networks. The position oversees the acquisition and maintenance of all information processing equipment. EXHIBIT B --------- CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT 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. 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 -------------------------- ----------------------- EX-10.63 6 EMPLOYMENT AGMT. BETWEEN REGISTRANT & INFANTE EXHIBIT 10.63 [ASPECT LETTERHEAD] March 1, 1999 Beatriz V. Infante Executive Vice President, Products & Services Dear Beatriz: This letter agreement (the "Agreement") is to confirm the terms of your ongoing employment with Aspect Telecommunications Corporation (the "Company"). 1. This Agreement will commence on the date hereof and continue for a term of two (2) years (the "Original Term"), unless extended for one or more ------------- additional one-year terms upon mutual written agreement of the parties or unless terminated pursuant to the terms described herein. In the event that the Company has entered into discussions with a third party regarding a Change of Control (as defined below) transaction and such Change of Control discussions are ongoing at the end of the Original Term, this Agreement shall be automatically extended pending consummation of such transaction. 2. You are employed as Executive Vice President, Products & Services 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 of Directors (the "Board"), at all times loyally and conscientiously perform all of the duties and obligations required of you pursuant to the terms of this Agreement. You will comply with and be bound by the Company's operating policies, procedures and practices from time to time in effect 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. 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. The rights and duties created by this paragraph may not be modified in any way except by a written agreement executed by 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 within twelve (12) months of a Change of Control (as defined below), you will be entitled to receive payment of severance benefits equal to your regular monthly salary (subject to any applicable tax withholding) until the earlier of (i) twelve (12) months following the termination date or (ii) the date on which you commence comparable employment (as defined below) with another employer (the "Severance Period"). Such payments will be made ratably over the Severance Period according to the Company's standard payroll schedule. Health insurance benefits with the same coverage provided to you prior to the termination (e.g. medical, dental, optical, mental health) and in all other respects significantly comparable to those in place immediately prior to the termination will be provided at the Company's cost over the Severance Period. In addition, and except as otherwise determined below, each stock option and share of restricted stock you hold that is not otherwise fully exercisable or vested (released from the Company's repurchase option) as of the termination date shall become immediately exercisable or vested in full as of such date. 5. In the event it is determined by the Board, upon consultation with Company management and the Company's independent auditors, that the enforcement of paragraph 4 of this Agreement, which allows for the acceleration of vesting of option shares and restricted stock upon an involuntary or constructive termination following a Change of Control, would preclude accounting for any proposed business combination of the Company involving a Change of Control as a pooling of interests, and the Board otherwise desires to approve such a proposed business transaction which requires as a condition to the closing of such transaction that it be accounted for as a pooling of interests, then such paragraph shall be null and void. For purposes of this paragraph, the Board's determination shall require the unanimous approval of the non-employee Board members. 6. In the event that the severance and other benefits provided to you by this Agreement constitute "parachute payments" within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the "Code") and, but for this paragraph, would be subject to the excise tax imposed by Section 4999 of the Code, the Company shall reduce the aggregate amount of such payments and benefits such that the present value thereof (as determined under the Code and the applicable regulations) is equal to 2.99 times your "base amount" as defined in Section 280G(b)(3) of the Code. The payment of severance and other benefits provided for in this Agreement shall be subject to all applicable income and employment tax rules and regulations. 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 substantially to perform your duties hereunder (other than any such failure due to your physical or mental illness), and such willful failure is not remedied within 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 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 contender to a crime that constitutes a felony, 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 10 business days after written notice from the Company's Chief Executive Officer, which written -2- notice shall state that failure to remedy such conduct may result in an involuntary termination for cause. (b) "Change of Control" will mean the occurrence of any of the ----------------- following events: (i) 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) or (ii) a sale of all or substantially all of the assets of the Company (collectively, a "Merger"), so long as in either case the Company's shareholders ------ of record immediately prior to such Merger will, immediately after such Merger, hold less than 50% of the voting power of the surviving or acquiring entity. (c) "Comparable Employment" will mean employment or consulting that --------------------- provides compensation, benefits and duties that, in the sole discretion of the Board, are deemed to be generally comparable to those pertaining to your position with the Company at the time of termination of your employment. (d) "Constructive Termination" will be deemed to occur if (A) (i) ------------------------ your duties and responsibilities as Executive Vice President, Products & Services of the company are materially diminished without your prior written consent; and/or (ii) any reduction in the total value of your base compensation and benefits occurs; and/or (iii) your new business office location is more than 50 miles or greater than current commute (whichever is greater) from your current business office location. Construction termination does not occur when your reduction in duties, position or responsibilities solely results by virtue of the company being acquired and made a part of a larger entity; and (B) within sixty (60) days immediately following such material change in duties or reduction or refusal to relocate you elect to terminate your employment voluntarily. 8. You have signed a Confidential Information and Invention Assignment 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. You represent that your performance of all the terms of this Agreement will not breach any other agreement to which you are a party. You have not, and will not during the term of this Agreement, enter into any oral or written agreement in conflict with any of the provisions of this Agreement. 10. Any successor to the Company (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company's business and/or assets will assume the obligations under this Agreement and agrees expressly to perform the obligations under this Agreement in the same manner and to the same -3- extent as the Company would be required to perform such obligations in the absence of a succession. The terms of this Agreement and all of your rights hereunder will inure to the benefit of, and be enforceable by, your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. 11. This Agreement, including any Exhibits hereto, constitutes the sole agreement of the parties and supersedes all oral negotiations and prior writings with respect to the subject matter hereof. 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 or by a nationally-recognized delivery service (such as Federal Express or UPS), or 48 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 renegotiate 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, (ii) the balance of the Agreement will be interpreted as if such provision were so excluded 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. The Company agrees to pay, on a monthly basis, the reasonable attorney fees, costs and expenses (as determined by the arbitrator) incurred by you in good faith in connection with the arbitration, regardless of the outcome. You agree that punitive damages will not be awarded. This paragraph will not apply to the Confidentiality Agreement. -4- 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 Telecommunications Corporation /s/ James R. Carreker By:_____________________________ Title: Chairman, President & Chief Executive Officer My Agreement with the above terms is signified by my signature below /s/ Beatriz V. Infante ------------------------ Beatriz V. Infante -5- EXHIBIT A --------- DESCRIPTION OF JOB DUTIES AND RESPONSIBILITIES Executive Vice President, Products and Services - Beatriz Infante - ----------------------------------------------------------------- This position is responsible for overseeing all functions relating to product development and delivery of product support and customer education and consulting services. The position is responsible for directing the unit to ensure the attainment of profit and operations goals. 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 AT WILL I agree that this Agreement is not an employment contract and that I have the right to resign and the Company has the right to terminate my employment at any time, for any reason, with or without cause. This is the full and complete agreement between myself and the Company and no employee or representative of the Company has any authority to enter into any agreement to the contrary. 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 written 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 INVENTIONS Without further compensation, I hereby assign and agree to assign to the Company or its designee, my entire right, title, and interest in and to all Inventions made by me during the period of my employment, unless the Invention was developed entirely on my own time without using the Company's equipment, supplies, facilities, or trade secret information; and (a) the Invention does not relate at the time of conception or reduction to practice of the Invention to the Company's business, or the Company's actual or demonstrably anticipated research or development; and, (b) the Invention does not result from any work performed by me for 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 a sheet attached to and made a part of this Agreement, if any. 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. 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 NONDISCLOSURE I agree to hold in confidence and not directly or indirectly to 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. 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 SOLICITATION I agree that for a period of twelve (12) months immediately following the termination of my relationship with the Company for any reason, I shall not either directly or indirectly solicit, induce, recruit or encourage any of the Company's employees to leave their employment or attempt to solicit, induce, encourage or recruit employees of the Company, either for myself or for any other person or entity. 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 assignees 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. EMPLOYEE BEATRIZ V. INFANTE /s/ Beatriz V. Infante ----------------------- ----------------------- Print Name Signature 10/22/98 ----------------------- Date ASPECT TELECOMMUNICATIONS CORPORATION Maria Brailas /s/ Maria Brailas ----------------------- ----------------------- Print Name Signature Staffing Coordinator ----------------------- Title EX-27 7 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM (A) THE CONSOLIDATED BALANCE SHEET AND CONSOLIDATED STATEMENT OF INCOME INCLUDED IN THE COMPANY'S FORM 10-Q FOR THE PERIOD ENDING MARCH 31, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH (B) FINANCIAL STATEMENTS. 1,000 USD 3-MOS DEC-31-1999 JAN-01-1999 MAR-31-1999 1 55,440 74,304 134,431 2,039 22,329 352,527 74,276 5,277 545,076 107,823 156,036 0 0 135,970 (1,578) 545,076 51,196 100,085 17,740 53,394 65,444 0 2,461 (18,972) (5,692) (18,753) 0 0 0 (13,280) (0.27) (0.27)
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