printer-friendly

Sample Business Contracts

Employment Agreement - Centigram Communications Corp. and Robert L. Puette

Employment Forms

  • Employment Contract. Employers can customize an employment agreement that states the salary, benefits, working hours and other important provisions for their new or existing employee.
  • Consulting Agreement. Answer simple questions to build a contract with a consultant. Specify the services rendered, when payment is due, as well as IP rights.
  • Commission Agreement. Employers who compensate their sales employees based on commissions can prepare an agreement to reduce misunderstandings by specifying the base salary and how commissions are calculated.
  • Executive Employment Agreement. Companies may offer their business executives a contract that is different from the one provided to their regular employees. Executive employment agreements may be more complex because the compensation structure may include a combination of salary and commissions, provide for bonuses based on sales, stock or other financial targets, and include non-compete, confidentiality and severance provisions.
  • Sales Representative Contract. Independent sales representatives offer companies the potential to increase the sale of products or services without the burden of increasing headcount. Both parties should understand how commissions are calculated, when commissions will be paid, as well as how the representative will treat confidential information from the company and whether the representative may also sell a competing line of products or services.
  • More Employment Agreements

Sponsored Links

                               EMPLOYMENT AGREEMENT


This Employment Agreement (the "Agreement") is made and entered into 
effective as of October 24, 1997, by and between Centigram Communications 
Corporation, a Delaware corporation (the "Company") and Robert L. Puette 
(the "Employee").

                                 R E C I T A L  S

A.      The Employee has been employed by the Company as the Company's 
President and Chief Executive Officer.

B.      The Company and the Employee desire to enter into this 
Agreement to provide additional financial security and benefits to the 
Employee as an inducement for Employee to be employed by the Company and 
to encourage the Employee to continue his employment with the Company.

C.      Certain capitalized terms used in the Agreement are defined in 
Section 3 below.

                                 A G R E E M E N T

In consideration of the mutual covenants herein contained, and in 
consideration of the continuing employment of the Employee by the Company, 
the parties agree as follows:

        1.      Employment Relationship and Compensation.

(a)     Subject to the terms and conditions hereof, the Employee 
shall be employed as the Company's President and Chief Executive Officer 
with all the duties, authority and responsibilities customary to such 
positions.  The Company and the Employee acknowledge that the Employee's 
employment is and shall continue to be at-will, as defined under 
applicable law.  If the Employee's employment terminates for any reason, 
the Employee shall not be entitled to any payments, benefits, damages, 
awards or compensation other than as provided by this Agreement, or as may 
otherwise be available in accordance with the Company's established 
employee plans and policies at the time of termination.

(b)     Employee's base salary shall initially be $340,000 per 
year at $28,333.33 per month, paid bi-weekly.  Employee shall also 
participate in the Company's Executive Bonus Program pursuant to which 
Employee shall be eligible to receive a bonus of at least fifty percent 
(50%) of Employee's then current base salary upon achievement of one 
hundred percent (100%) of target operating profits and corporate 
objectives as determined by the Company's Board of Directors (the 
"Board").  For fiscal year 1998 (November 1997 to October 1998), Employee 
is guaranteed his bonus of at least $170,000 provided that he is an 
employee at the end of such fiscal year, provided further that, in the 
event Employee is Involuntarily Terminated other than for Cause during 
such fiscal year, such guaranteed bonus shall be prorated to the 
Termination Date.  For fiscal year 1998, $85,000 of Employee's bonus shall 
be paid promptly following the end of the Company's second fiscal quarter 
and the remainder of Employee's bonus shall be paid promptly following the 
end of the Company's fiscal year.  As of the first date of his employment, 
Employee shall also be granted an option to purchase 350,000 shares of the 
Company's Common Stock.  Such option shall vest over four (4) years with 
twenty-five percent (25%) vesting one year after Employee's first date of 
employment and the remaining shares shall vest monthly thereafter.

(c)     Employee shall be eligible to participate in the 
Company's Employee Benefit Program which presently includes medical, 
dental, prescription, vision and hospital coverage, life insurance, long-
term disability income insurance, a 401(k) Plan and the Company's Employee 
Stock Purchase Plan.  Employee shall also receive $500 per month for car 
allowance and reimbursement for tax preparation and an annual executive 
physical exam.

        2.      Severance Benefits.

(a)     Termination Not for Cause.  Subject to Sections 4 and 5 
below, if the Employee's employment with the Company terminates as a 
result of Involuntary Termination other than for Cause at any time prior 
to a Change of Control, then (i) the Employee shall be entitled to receive 
a severance payment equal to one year of the Employee's base compensation 
for the Company's fiscal year then in effect plus Employee's bonus 
calculated at one hundred percent of target for the Company's fiscal year 
then in effect and (ii) for the one year period commencing on the 
Employee's Termination Date, Employee shall continue to receive at 
Company's expense all benefits described in Section 1(c) hereof which are 
provided to Employee on the Termination Date except participation in the 
Company's 401(k) Plan and Employee Stock Purchase Plan.  The Company may 
satisfy the obligation to provide the foregoing benefits by a cash payment 
to Employee equal to the reasonable cost to obtain equivalent benefits.  
Any severance payments to which the Employee is entitled pursuant to 
clause (i) of this Section 2(a) shall be paid to the Employee (or to the 
Employee's estate or beneficiary in the event of the Employee's death) in 
a lump sum within fifteen (15) days of the Employee's Termination Date.

(b)     Termination as Part of or Following A Change of Control.  
Subject to Sections 4 and 5 below, if the Employee's employment with the 
Company terminates at any time within twelve months after a Change of 
Control (or within sixty days prior to a Change in Control if such 
termination is directly caused by such Change of Control) as a result of 
Involuntary Termination other than for Cause, (i) the Employee shall be 
entitled to receive a severance payment equal to the 1.5 times one year of 
the Employee's base compensation for the Company's fiscal year then in 
effect plus 1.5 times Employee's bonus calculated at one hundred percent 
of target for the Company's fiscal year then in effect and (ii) for the 
five hundred and forty day period commencing on the Employee's Termination 
Date, Employee shall continue to receive at Company's expense all benefits 
described in Section 1(c) hereof which are provided to Employee on the 
Termination Date except participation in the Company's 401(k) Plan and 
Employee Stock Purchase Plan.  The Company may satisfy the obligation to 
provide the foregoing benefits by a cash payment to Employee equal to the 
reasonable cost to obtain equivalent benefits.  Any severance payments to 
which the Employee is entitled pursuant to clause (i) of this Section 2(b) 
shall be paid to the Employee (or to the Employee's estate or beneficiary 
in the event of the Employee's death) in a lump sum within fifteen (15) 
days of the Employee's Termination Date.

 (c)    Voluntary Resignation; Termination For Cause.  If the 
Employee voluntarily resigns from the Company (other than as an 
Involuntary Termination), or if the Company terminates the Employee's 
employment for Cause, then the Employee shall not be entitled to receive 
severance or other benefits except for those (if any) as may then be 
established under the Company's then existing severance and benefits plans 
and policies at the time of such resignation or termination.

(d)     Disability; Death.  If the Company terminates the 
Employee's employment as a result of the Employee's Disability, or if the 
Employee's employment terminates due to the death of the Employee, then 
the Employee shall not be entitled to receive severance or other benefits 
except for those (if any) as may then be established under the Company's 
then existing severance and benefits plans and policies at the time of 
such Disability or death.

(e)     Options.  Subject to Sections 4 and 5 below, (i) in the 
event of a Change of Control, the unvested portion of any stock option(s) 
held by the Employee under the Company's stock option plans which, were 
the Employee to remain employed by the Company for all relevant periods, 
would have vested and become exercisable at any time during the two years 
following such Change in Control, shall, as of the date of such Change in 
Control, immediately vest and become exercisable in full, and the Employee 
shall have the right to exercise such additional vested portion of such 
stock option(s) at such time; and (ii) in the event the Employee is 
entitled to severance benefits pursuant to Section 2(b), then in addition 
to any such severance benefits, the unvested portion of all stock 
option(s) held by the Employee granted by the Company or any successor in 
interest thereto shall, as of the Termination Date, immediately vest and 
become exercisable in full, and the Employee shall have the right to 
exercise such additional vested portion of such stock option(s) at such 
time.

3.      Definition of Terms.  The following terms referred to in this 
Agreement shall have the following meanings:

(a)     Cause.  "Cause" shall mean (i) any act of personal 
dishonesty taken by the Employee in connection with his responsibilities 
as an employee and intended to result in substantial personal enrichment 
of the Employee, (ii) conviction of a felony that is demonstrably 
injurious to the Company, (iii) a willful act by the Employee which 
constitutes gross misconduct and which is demonstrably injurious to the 
Company, and (iv) continued violations by the Employee of the Employee's 
obligations as an employee of the Company that are demonstrably willful 
and deliberate on the Employee's part after there has been delivered to 
the Employee a written demand for performance from the Company which 
dearly describes the basis for the Company's belief that the Employee has 
not substantially performed his duties and Employee has been given 
fourteen (14) days to perform after receipt of such written demand.

(b)     Change of Control.  "Change of Control" shall mean the 
occurrence of any of the following events:

(i)     The acquisition by any "person" (as such term is 
used in Sections 13(d) and 14(d) of the Exchange Act) (other than the 
Company or a person that directly or indirectly controls, is controlled 
by, or is under common control with, the Company) of the "beneficial 
ownership" (as defined in Rule 13d-3 under said Act), directly or 
indirectly, of securities of the Company representing fifty percent (50%) 
or more of the total voting power represented by the Company's then 
outstanding voting securities; or

(ii)    A change in the composition of the Board occurring 
within a two-year period, as a result of which fewer than a majority of 
the directors are Incumbent Directors.  "Incumbent Directors" shall mean 
directors who either (A) are directors of the Company as of the date 
hereof, or (B) are elected, or nominated for election, to the Board with 
the affirmative votes of at least a majority of the Incumbent Directors at 
the time of such election or nomination; or

(iii)   A merger or consolidation of the Company with any other corporation,
other than a merger or consolidation which would result in the voting securities
of the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or the approval by
the stockholders of the Company of a plan of complete liquidation of the Company
or of an agreement for the sale or disposition by the Company of all or
substantially all the Company's assets.

(c)     Disability.  "Disability" shall mean that the Employee 
has been unable to substantially perform his duties under this Agreement 
as the result of his incapacity due to physical or mental illness for at 
least 26 weeks and such incapacity is determined to be total and permanent 
by a physician selected by the Company or its insurers and acceptable to 
the Employee or the Employee's legal representative (such Agreement as to 
acceptability not to be unreasonably withheld).

d)     Exchange Act.  "Exchange Act" shall mean the Securities 
Exchange Act of 1934, as amended.

(e)     Involuntary Termination.  "Involuntary Termination" 
shall mean (i) without the Employee's express written consent, the 
significant reduction of the Employee's duties, authority or 
responsibilities relative to the Employee's duties, authority and 
responsibilities granted by this Agreement; (ii) without the Employee's 
express written consent, a substantial reduction, without good business 
reasons, of the facilities and perquisites (including office space and 
location) available to the Employee immediately prior to such reduction; 
(iii) without the Employee's express written consent, a reduction by the 
Company in the base compensation of the Employee as in effect immediately 
prior to such reduction; (iv) a material reduction by the Company in the 
kind or level of employee benefits to which the Employee is entitled 
immediately prior to such reduction with the result that the Employee's 
overall benefits package is significantly reduced; (v) the relocation of 
the Employee to a facility or a location more than 30 miles from the 
Employee's then present location, without the Employee's express written 
consent; (vi) any purported termination of the Employee by the Company 
which is not effected for Disability or for Cause, or any purported 
termination for which the grounds relied upon are not valid; or (vii) the 
failure of the Company to obtain the assumption of this agreement by any 
successors contemplated in Section 6 below.

 (g)    Termination Date.  "Termination Date" shall mean (i) if 
the Employee's employment is terminated by the Company for Death or 
Disability, thirty (30) days after notice of termination is given to the 
Employee (provided that, in the event of Disability, the Employee shall 
not have returned to the performance of the Employee's duties on a 
full-time basis during such thirty (30) day period), (ii) if the 
Employee's employment is terminated by the Company for any other reason, 
the date on which the Company delivers notice of termination to the 
Company or such later date, not to exceed ninety (90) days, specified in 
the notice of termination, or (iii) if the Agreement is terminated by the 
Employee, the date on which the Employee delivers notice of termination to 
the Company.

        4.      Limitation on Payments.

(a)     In the event that the severance and other benefits 
provided for in this Agreement or otherwise payable to the Employee (i) 
constitute "parachute payments" within the meaning of Section 280G of the 
Internal Revenue Code of 1986, as amended (the "Code") and (ii) but for 
this Section 4 would be subject to the excise tax imposed by Section 4999 
of the Code, then the Employee's severance benefits under Section 2 shall 
be payable either (i) in full, or (ii) as to such lesser amount which 
would result in no portion of such severance benefits being subject to 
excise tax under Section 4999 of the Code, whichever of the foregoing 
amounts, taking into account the applicable federal, state and local 
income taxes and the excise tax imposed by Section 4999, results in the 
receipt by the Employee on an after-tax basis, of the greatest amount of 
severance benefits under this Agreement, notwithstanding that all or some 
portion of such severance benefits may be taxable under Section 4999 of 
the Code.

(b)     If a reduction in the payments and benefits that would 
otherwise be paid or provided to the Employee under the terms of this 
Agreement is necessary to comply with the provisions of Section 4(a), the 
Employee shall be entitled to select which payments or benefits will be 
reduced and the manner and method of any such reduction of such payments 
or benefits (including but not limited to the number of options that would 
vest under Section 2(e)) subject to reasonable limitations (including, for 
example, express provisions under the Company's benefit plans) (so long as 
the requirements of Section 4(a) are met).  Within thirty (30) days after 
the amount of any required reduction in payments and benefits is finally 
determined in accordance with the provisions of Section 4(c), the Employee 
shall notify the Company in writing regarding which payments or benefits 
are to be reduced.  If no notification is given by the Employee, the 
Company will determine which amounts to reduce.  If, as a result of any 
reduction required by Section 4(a), amounts previously paid to the 
Employee exceed the amount to which the Employee is entitled, the Employee 
will promptly return the excess amount to the Company.  Subject to the 
terms and conditions of this Section 4, in connection with any reduction 
of benefits pursuant to Section 4(a), the Company will use its 
commercially reasonable efforts to assist Employee in obtaining the 
benefits to which Employee is entitled hereunder to the fullest extent 
practicable.

(c)     Unless the Company and the Employee otherwise agree in 
writing, any determination required under this Section 4 shall be made in 
writing by the Company's independent public accountants (the 
"Accountants"), whose determination shall be conclusive and binding upon 
the Employee and the Company for all purposes.  For purposes of making the 
calculations required by this Section 4, the Accountants may make 
reasonable assumptions and approximations concerning applicable taxes and 
may rely on reasonable, good faith interpretations concerning the 
application of Sections 280G
and 4999 of the Code.  The Company and the Employee shall furnish to the 
Accountants such information and documents as the Accountants may 
reasonably request in order to make a determination under this Section.  
The Company shall bear all costs the Accountants may reasonably incur in 
connection with any calculations contemplated by this Section 4.

         5.  Certain Business Combinations.  In the event it is determined
by the Board, upon receipt of a written opinion of the Company's 
independent public accountants, that the enforcement of any Section or 
subsection of this Agreement, including, but not limited to, Section 2(e) 
hereof, which allows for the acceleration of vesting of options to 
purchase shares of the Company's common stock upon a termination in 
connection with 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 any such Section of this Agreement shall be null and void, 
but only if the absence of enforcement of such Section would preserve the 
pooling treatment.  For purposes of this Section 5, the Board's 
determination shall require the unanimous approval of the disinterested 
Board members.  In such event, if Employee is Involuntarily Terminated 
other than for Cause within twelve months following such Change in 
Control, Employee shall be retained as a consultant to the Company for two 
years and be permitted to continue vesting of all stock options held by 
the Employee on the Termination Date during such period, provided that, 
nothing in this sentence shall require the Company (or any successor 
thereto or acquirer thereof) to take any action which would result in such 
entity incurring a material accounting expense for purposes of such 
entity's financial statements as a result of such continued vesting.

        6.      Successors.

(a)     Companys Successors.  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 shall assume the obligations under 
this Agreement and agree expressly to perform the obligations under this 
Agreement in the same manner and to the same extent as the Company would 
be required to perform such obligations in the absence of a succession.  
For all purposes under this Agreement, the term "Company" shall include 
any successor to the Company's business and/or assets which executes and 
delivers the assumption agreement described in this Section 6(a) or which 
becomes bound by the terms of this Agreement by operation of law.

(b)     Employee's Successors.  The terms of this Agreement and 
all rights of the Employee hereunder shall inure to the benefit of, and be 
enforceable by, the Employee's personal or legal representatives, 
executors, administrators, successors, heirs, devisees and legatees.

        7.      Notice.

(a)     General.  Notices and all other communications 
contemplated by this Agreement shall be in writing and shall be deemed to 
have been duly given when personally delivered or when mailed by U. S. 
registered or certified mail, return receipt requested and postage 
prepaid.  In the case of the Employee, mailed notices shall be addressed 
to him at the home address which he most recently communicated to the 
Company in writing.  In the case of the Company, mailed notices shall be 
addressed to its corporate headquarters, and all notices shall be directed 
to the attention of its Chief Financial Officer.

(b)     Notice of Termination.  Any termination by the Company 
for Cause or by the Employee as a result of an Involuntary Termination 
shall be communicated by a notice of termination to the other party hereto 
given in accordance with Section 7(a) of this Agreement.  Such notice 
shall indicate the specific termination provision in this Agreement relied 
upon, shall set forth in reasonable detail the facts and circumstances 
claimed to provide a basis for termination under the provision so 
indicated, and shall specify the Termination Date (which shall be not more 
than ninety (90) days after the giving of such notice).  The failure by 
the Employee to include in the notice any fact or circumstance which 
contributes to a showing of Involuntary Termination shall not waive any 
right of the Employee hereunder or preclude the Employee from asserting 
such fact or circumstance in enforcing his rights hereunder.

        8.      Miscellaneous Provisions.

(a)     No Duty to Mitigate.  The Employee shall not be required 
to mitigate the amount of any payment contemplated by this Agreement 
(whether by seeking new employment or in any other manner), nor shall any 
such payment be reduced by any earnings that the Employee may receive from 
any other source.

(b)     Waiver.  No provision of this Agreement shall be 
modified, waived or discharged unless the modification, waiver or 
discharge is agreed to in writing and signed by the party hereto whose 
interests are adversely affected thereby (provided that Employee may not 
sign on behalf of the Company for such purpose).  No waiver by either 
party of any breach of, or of compliance with, any condition or provision 
of this Agreement by the other party shall be considered a waiver of any 
other condition or provision or of the same condition or provision at 
another time.

(c)     Whole Agreement.  No agreements, representations or 
understandings (whether oral or written and whether express or implied) 
which are not expressly set forth in this Agreement have been made or 
entered into by either party with respect to the subject matter hereof.  
This Agreement shall replace and supersede any prior agreement between the 
parties hereto relating to the accrual of any benefits to the Employee in 
connection with a change in control or organic change to the Company or 
the cessation of Employee's employment relationship with the Company 
(other than stock option agreements, if any, but including, without 
limitation, that certain letter agreement pursuant to which the Company 
offered Employee the position of President and Chief Executive Officer of 
the Company dated on or about September 24, 1997) and all such agreements 
shall henceforth be void and of no further force and effect.

(d)     Choice of Law.  The validity, interpretation, 
construction and performance of this Agreement shall be governed by the 
laws of the State of California.

 (e)    Severability.  The invalidity or unenforceability of any 
provision or provisions of this Agreement shall not affect the validity or 
enforceability of any other provision hereof, which shall remain in full 
force and effect.

(f)     Arbitration.  Any dispute or controversy arising out of, 
relating to or in connection with this Agreement shall be settled 
exclusively by binding arbitration in San Jose, California, in accordance 
with the California Code of Civil Procedure section 1280 et seq., as 
amended, including, but not limited to, sections 1283, 1283.05 and 1283.1, 
such that the full degree of discovery permitted under the aforementioned 
statutes will be allowed in any dispute hereunder.  Judgment may be 
entered on the arbitrator's award in any court having jurisdiction.  The 
prevailing party shall be awarded its counsel fees and expenses, including 
costs of arbitration.  Punitive damages shall not be awarded.

(g)     No Assignment of Benefits.  The rights of any person to 
payments or benefits under this Agreement shall not be made subject to 
option or assignment, either by voluntary or involuntary assignment or by 
operation of law, including (without limitation) bankruptcy, garnishment, 
attachment or other creditor's process, and any action in violation of 
this Section 8(g) shall be void.

(h)     Employment Taxes.  All payments made pursuant to this 
Agreement will be subject to withholding of applicable income and 
employment taxes.

(i)     Assignment by Company.  The Company may assign its 
rights under this Agreement to an affiliate, and an affiliate may assign 
its rights under this Agreement to another affiliate of the Company or to 
the Company; provided, however, that no assignment shall be made if the 
net worth of the assignee is less than the net worth of the Company at the 
time of assignment.  In the case of any such assignment, the term 
"Company" when used in a section of this Agreement shall mean the 
corporation that actually employs the Employee.

(j)     Counterparts.  This Agreement may be executed in 
counterparts, each of which shall be deemed an original, but all of which 
together will constitute one and the same instrument.

(k)     Attorney's Fees.  The Company shall reimburse Employee 
for his reasonable attorney's fees incurred in connection with this 
Agreement, up to a maximum of $3,500.

IN WITNESS WHEREOF, each of the parties has executed this 
Agreement, in the case of the Company by its duly authorized officer, as 
of the day and year first above written.


COMPANY:
CENTIGRAM COMMUNICATIONS CORPORATION

By:
/s/ D. O. Morton

Title: Chairman




EMPLOYEE:

/s/ Robert L. Puette