Employment Agreement - Comverse Technology Inc. and Raz Alon
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement"), is made and entered into
as of the 14th day of July, 2006, by and between Comverse Technology, Inc., a
New York corporation (together with its successors and assigns permitted under
this Agreement, the "Company"), and Raz Alon (the "Executive").
W I T N E S S E T H
WHEREAS, the Executive has been serving as the Chief Executive Officer
of the Company since April 28, 2006;
WHEREAS, the Company desires to continue the employment of the
Executive as its Chief Executive Officer during the Term of Employment (as
hereinafter defined) by entering into this Agreement; and
WHEREAS, Executive desires to enter into this Agreement and to accept
such employment, subject to the terms and provisions of this Agreement.
NOW, THEREFORE, in consideration of the above premises and mutual
covenants contained herein and for other good and valuable consideration, the
receipt of which is mutually acknowledged, the Company and the Executive
(individually a "Party" and together the "Parties"), intending to be legally
bound, agree as follows:
1. Definitions.
(a) "Base Salary" shall mean the Executive's base
salary as determined in accordance with Section 4 below.
(b) "Board" shall mean the board of directors of the
Company.
(c) "Bonus" shall mean the bonus specified in Section 5
below.
(d) "Cause" shall mean:
(1) a conviction of the Executive, or a plea of nolo contendere,
to a felony or a misdemeanor involving moral turpitude; or
(2) a material violation by the Executive of federal or state
securities laws as determined by a court or other
governmental body of competent jurisdiction; or
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(3) willful misconduct or gross negligence by the Executive with
respect to the Company or any Subsidiary resulting in
demonstrable harm to the Company or any Subsidiary; or
(4) the repeated or continued failure by the Executive to carry
out, in all material respects, the reasonable and lawful
directions of the Board that are within the Executive's
individual control and consistent with the Executive's
status as Chief Executive Officer of the Company and his
duties and responsibilities hereunder after not less than
twenty days' written notice from the Board of their
existence and continuation; or
(5) a material violation by the Executive of (i) the Company's
Code of Ethics and Business Conduct applicable to the
Executive or (ii) any other policy or procedure of the
Company if, in the case of this clause (ii), the Company has
given the Executive written notice of such violation and the
Executive persists in such violation; or
(6) fraud, embezzlement, theft or dishonesty by the Executive
against the Company or any of Subsidiary.
(e) "Code" shall mean the Internal Revenue Code of
1986, as amended from time to time, and the regulations and
rules promulgated thereunder.
(f) "Compensation Committee" shall mean the
Compensation Committee of the Board or another committee of
the Board that performs the functions typically associated
with a compensation committee.
(g) "Competitive Activity" shall mean the Executive's
engaging in an activity - whether as an employee,
consultant, principal, member, agent, officer, director,
partner or shareholder (except for investment(s) in which
the Executive is not personally involved in management or
providing operating direction to management) that is
competitive with any business of the Company or any
Subsidiary conducted by the Company or such Subsidiary at
any time during the Noncompetition/Nonsolicitation Period;
provided, however, that the Executive may be employed by or
otherwise associated with a business of which a subsidiary,
division, segment, unit, etc. is in competition with the
Company or any Subsidiary but as to which such subsidiary,
division, segment, unit, etc. the Executive has no direct or
indirect operating responsibilities or involvement. For the
avoidance of doubt, a business "is competitive with any
business of the Company or any Subsidiary" if such business
offers or sells products or services that are functionally
equivalent
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to, substitutable for or closely related to the products or
services sold by the Company.
(h) "Disability" shall mean the Executive's inability
to substantially perform his duties and responsibilities
under this Agreement for a period of (i) 6 consecutive
months or (ii) 180 days in any 12-month period, as
determined by a licensed physician mutually selected by the
Company and the Executive. If the Parties cannot agree on a
licensed physician, each Party shall select a licensed
physician and the two licensed physicians shall select a
third licensed physician who shall make such determination
for this purpose.
(i) "Effective Date" shall mean the date of this
Agreement.
(j) "Equity Grant" shall mean the award of equity
incentive compensation specified in Section 6 below.
(k) "Good Reason" shall mean, without the Executive's
prior written consent, the occurrence of any of the
following events or actions within the 60-day period
preceding a termination of employment by the Executive:
(1) a reduction of the Executive's Base Salary or Bonus
specified in Sections 4 and 5 below, respectively; or
(2) an actual relocation of the Executive's principal office
outside of the continental United States; or
(3) a material, substantive and adverse diminution of the
Executive's title, duties or responsibilities (including,
without limitation, having the Executive report to anyone
other than the Board); or
(4) a failure of the Company to obtain the assumption in writing
of its obligation under this Agreement by any successor to
all or substantially all of the assets of the Company within
10 days after completion of a sale of assets, merger,
consolidation, or similar transaction; or
(5) a material breach by the Company of any provision of this
Agreement.
(l) "Noncompetition/Nonsolicitation Period" shall mean
the period commencing on the Effective Date and ending on
the first anniversary of the date of the termination of the
Executive's employment as Chief Executive Officer.
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(m) "Subsidiary" shall mean an affiliate controlled by
the Company directly, or indirectly through one or more
intermediaries.
(n) "Term of Employment" shall mean the period
specified in Section 2 below.
(o) "Voting Stock" shall mean capital stock of any
class or classes having general voting power under ordinary
circumstances, in the absence of contingencies, to elect the
directors of a corporation.
2. Term of Employment.
The Company hereby employs the Executive, and the Executive
hereby accepts such employment, for the period commencing on the Effective Date
and ending on April 30, 2007, subject to earlier termination of the Term of
Employment in accordance with the terms of this Agreement.
3. Position, Duties and Responsibilities; Reporting.
As of the Effective Date and continuing for the remainder of the
Term of Employment, the Executive shall be employed as the Chief Executive
Officer of the Company. The Executive shall serve the Company faithfully,
conscientiously and to the best of the Executive's ability and shall promote the
interests and reputation of the Company in a manner consistent with the duties
of chief executive officers of similarly situated companies. Unless prevented by
sickness or Disability, the Executive shall devote substantially all of the
Executive's time, attention, knowledge, energy and skills, during normal working
hours, and at such other times as the Executive's duties may reasonably require,
to the duties of the Executive's employment. The Executive, in carrying out his
duties under this Agreement, shall report to the Board. During the Term of
Employment, the Executive shall serve on the Board, any committees of the Board
(including the Special Committee), the boards of directors of Subsidiaries of
the Company and any committees thereof without additional compensation therefor
and, following the expiration or earlier termination of the Term of Employment,
it is the intention of the Executive to continue serving on the Board and the
Special Committee.
4. Base Salary.
The Executive shall be paid an annualized Base Salary of
$600,000, payable in accordance with the regular payroll practices of the
Company.
5. Bonus.
The Company shall pay to the Executive a bonus of $400,000 (the
"Bonus") at the conclusion of the Term of Employment.
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6. Equity Incentive Compensation Programs.
(a) The parties acknowledge that, pursuant to the Company's 2005 Stock
Incentive Compensation Plan (the "2005 Plan") and a Deferred Stock Award
Agreement dated the date hereof (the "Deferred Stock Award Agreement"), the
Compensation Committee awarded to the Executive forty thousand (40,000) shares
of common stock of the Company in the form of deferred stock (the "Deferred
Stock"), which shall vest in accordance with the provisions of the Deferred
Stock Award Agreement. Shares of common stock in settlement of the Deferred
Stock award (or, at the Company's election, cash in lieu of shares based on the
fair market value thereof) shall be delivered to Executive in accordance with
the provisions of the Deferred Stock Award Agreement.
(b) The Executive shall be granted options to purchase a total of
thirty thousand (30,000) shares of common stock of the Company (the "Stock
Options") within ten (10) days after the first date on which the Company (i) is
eligible to use a registration statement on Form S-8 (or any successor form)
under the Securities Act of 1933, as amended, to register such Stock Options
(and the shares issuable upon the exercise thereof) and (ii) is under no legal
prohibition against granting such Stock Options. The exercise price of the Stock
Options shall equal the fair market value of the shares of the Company's common
stock on the date of grant. All such Stock Options shall vest and become
exercisable on April 30, 2007, subject to accelerated vesting as otherwise
provided herein. The Stock Options shall be granted under, and in accordance
with the terms of, the 2005 Plan.
7. Employee Benefit Programs.
During the Term of Employment, the Executive shall be entitled to
participate in various employee welfare and pension benefit plans, programs
and/or arrangements applicable to senior-level executives.
8. Reimbursement of Business Expenses; State Taxes Equalization
Payment.
(a) Business Expenses. During the Term of Employment,
the Executive is authorized to incur reasonable business
expenses in carrying out his duties and responsibilities
under this Agreement, and the Company shall reimburse him
for all such reasonable business expenses reasonably
incurred in connection with carrying out the business of the
Company, subject to documentation in accordance with the
Company's policy; it being understood that the Company will
pay (or reimburse the Executive for), following the
Executive's demand and in accordance with the Company's
policies, (i) transportation between the Executive's office
or residence in California and the Company's offices and
living expenses while working at the Company's offices or
elsewhere for purposes of the Company's business and (ii)
any taxes payable by the Executive as a result of the
payments or reimbursements referred to in clause (i) above,
such that the Executive incurs no cost (i.e., is
"grossed-up") for such taxes.
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(b) State Tax Equalization Payment. The Company shall
pay to the Executive, reasonably promptly following his
demand therefor, an additional payment (a "State Tax
Equalization Payment") in such amount that, after payment by
the Executive of all income taxes (federal, state and local)
imposed upon the State Tax Equalization Payment, the
Executive receives total after tax compensation for any
calendar year hereunder equal to the amount he would have
received if he had performed services for the Company
hereunder exclusively in the State of California (the
jurisdiction of his residence).
9. Perquisites.
During the Term of Employment, the Executive shall be entitled to
participate in the Company's executive fringe benefits applicable to the
Company's senior-level executives (if any) in accordance with the terms and
conditions of such arrangements as are in effect from time to time. In addition,
the Company shall pay (or reimburse the Executive for) (i) the reasonable fees
and disbursements of counsel to the Executive in connection with such counsel's
review and negotiation of this Agreement and (ii) reasonable accounting and
legal fees and disbursements incurred with respect to the calculation
contemplated by Section 8(b) above.
10. Vacation.
The Executive shall be entitled to four weeks paid vacation to be
taken at such time as the Executive determines at his discretion.
11. Termination of Employment.
(a) Termination of Employment Due to Death. In the
event of the Executive's death during the Term of
Employment, the Term of Employment shall end as of the date
of the Executive's death and his estate and/or
beneficiaries, as the case may be, shall be entitled to the
following:
(1) payment of Base Salary earned but not paid prior to the date
of his death;
(2) the Deferred Stock award and the Stock Options provided for
in Section 6 hereof shall immediately vest in full on the
date of his death;
(3) payment of any amounts earned, accrued or owing to the
Executive but not yet paid under Section 7, 8, 9 or 10
above; and
(4) payment or receipt of such other or additional benefits, if
any, as may be provided under applicable plans, programs
and/or arrangements of the Company.
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(b) Termination of Employment Due to Disability. If the
Executive's employment is terminated due to Disability
during the Term of Employment, by either the Company or the
Executive, the Term of Employment shall end as of the date
of the termination of the Executive's employment and the
Executive shall be entitled to the following:
(1) payment of Base Salary earned but not paid prior to the date
of the termination of the Executive's employment;
(2) the Deferred Stock award and the Stock Options provided for
in Section 6 hereof shall immediately vest in full on the
date of the termination of the Executive's employment;
(3) payment of any amounts earned, accrued or owing to the
Executive but not yet paid under Section 7, 8, 9 or 10
above; and
(4) payment or receipt of such other or additional benefits, if
any, as may be provided under applicable plans, programs
and/or arrangements of the Company.
In no event shall a termination of the Executive's employment for Disability
occur unless the Party terminating the Executive's employment gives written
notice to the other Party in accordance with Section 26 below.
(c) Termination of Employment by the Company for Cause.
If the Company terminates the Executive's employment for
Cause during the Term of Employment, the Term of Employment
shall end as of the date of the termination of the
Executive's employment for Cause and the Executive shall be
entitled to the following:
(1) payment of Base Salary earned but not paid prior to the date
of the termination of the Executive's employment;
(2) payment of any amounts earned, accrued or owing to the
Executive but not yet paid under Section 7, 8, 9 or 10
above; and
(3) payment or receipt of such other or additional benefits, if
any, as are provided under applicable plans, programs and/or
arrangements of the Company.
In no event shall a termination of the Executive's employment for Cause occur
unless the Company, with the approval of the Board, gives written notice to the
Executive in accordance with Section 26 below stating with specificity the
events or actions that constitute Cause and providing the Executive with an
opportunity to cure the same (if curable) within 20 calendar days after first
giving notice.
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(d) Termination of Employment by the Company Without
Cause. If the Executive's employment is terminated by the
Company without Cause, other than due to the Executive's
death or Disability, the Executive shall be entitled to the
following:
(1) payment of Base Salary earned but not paid prior to the date
of the termination of the Executive's employment;
(2) payment of an amount equal to the sum of (A) the Base Salary
otherwise payable through April 30, 2007 plus (B) the Bonus,
which amount shall be paid in a lump sum within five (5)
days after the date of termination of the Executive's
employment;
(3) the Stock Options provided for in Section 6 hereof shall
immediately vest in full on the date of the termination of
the Executive's employment and the Deferred Stock award
shall vest in accordance with the Deferred Stock Award
Agreement;
(4) payment of any amounts earned, accrued or owing to the
Executive but not yet paid under Section 7, 8, 9 or 10
above;
(5) payment of an amount equal to the Executive's costs
associated with COBRA health continuation benefits through
April 30, 2007; and
(6) payment or receipt of such other or additional benefits, if
any, as are provided under applicable plans, programs and/or
arrangements of the Company.
In no event shall a termination of the Executive's employment without Cause
occur unless the Company, with the approval of the Board, gives written notice
to the Executive in accordance with Section 26 below. A termination of the
Executive's employment under this Section 11(d) shall not by itself be a breach
of this Agreement.
(e) Termination of Employment by the Executive for Good
Reason. The Executive may terminate his employment for Good
Reason, provided that the actual date of the termination of
the Executive's employment occurs during the 60-day period
immediately following the date that the events or actions
constituting Good Reason first occur. Upon the Executive's
termination of his employment for Good Reason, the Executive
shall be entitled to the same payments and benefits as
provided in Section 11(d) above. In no event shall a
termination of the Executive's employment for Good Reason
occur unless the Executive gives written notice to the
Company in accordance with Section 26 below stating with
specificity the events or actions that constitute Good
Reason and providing the Company with an opportunity to cure
the same (if curable) within 20 calendar days after first
giving notice.
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(f) Voluntary Termination of Employment by the
Executive Without Good Reason. If the Executive voluntarily
terminates his employment without Good Reason, other than a
termination of employment due to the Executive's death or
Disability, the Executive shall be entitled to the same
payments and benefits as provided in Section 11(c) above. In
no event shall a voluntary termination of the Executive's
employment without Good Reason as described in the
immediately preceding sentence occur unless the Executive
gives written notice to the Company in accordance with
Section 26 below at least 90 days prior to the date of the
actual date of the termination of the Executive's
employment. A termination of the Executive's employment
under this Section 11(f) shall not by itself be a breach of
this Agreement.
(g) No Mitigation; No Offset. In the event of any
termination of the Executive's employment under this Section
11, the Executive shall be under no obligation to seek other
employment and there shall be no offset against amounts due
the Executive under this Agreement on account of any
compensation attributable to any subsequent employment that
he may obtain except as specifically provided in this
Section 11. Notwithstanding anything to the contrary
contained in any severance or change-in-control plan,
program, policy or arrangement of the Company in which the
Executive is a participant, the compensation and benefits
payable under this Section 11 shall be the sole and
exclusive compensation and benefits payable to the Executive
upon termination of employment.
(h) Return of Company Property. Promptly following the
date of any termination of the Executive's employment, the
Executive or his personal representative shall promptly
return all Company property in his possession, including but
not limited to all computer equipment (hardware and
software), telephones, facsimile machines, PDAs and other
communication devices, credit cards, office keys, security
access cards, badges, identification cards and all copies
(including drafts) of any documentation or information
(however stored) relating to the business of the Company,
its customers and clients or its prospective customers and
clients that is not publicly available.
(i) Nature of Payments. Any amounts due under this
Section 11 are in the nature of severance payments
considered to be reasonable by the Company and are not in
the nature of a penalty.
(j) Waiver and Release. As a condition precedent to
receiving the compensation and benefits provided under
Sections 11(d) or 11(e), the Executive shall execute a
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waiver and release substantially in the form attached to
this Agreement as Exhibit A.
12. Confidentiality: Assignment of Rights.
(a) During the Term of Employment and thereafter, the
Executive shall not disclose to anyone or make use of any
trade secret or proprietary or confidential information of
the Company, including such trade secret or proprietary or
confidential information of any customer or other entity to
which the Company owes an obligation not to disclose such
information, which he acquires during the Term of
Employment, including but not limited to records kept in the
ordinary course of business, except (i) as such disclosure
or use may be required or appropriate in connection with his
work as an employee of the Company, (ii) when required to do
so by a court of law, by any governmental agency having
supervisory authority over the business of the Company or by
any administrative or legislative body (including a
committee thereof) with apparent jurisdiction to order him
to divulge, disclose or make accessible such information, or
(iii) as to such confidential information that becomes
generally known to the public or trade without his violation
of this Section 12(a).
(b) The Executive hereby sells, assigns and transfers
to the Company all of his right, title and interest in and
to all inventions, discoveries, improvements and
copyrightable subject matter (the "rights") which during the
Term of Employment are made or conceived by him, alone or
with others, and which are within or arise out of any
general field of the Company's business or arise out of any
work he performs or information he receives regarding the
business of the Company while employed by the Company. The
Executive shall fully disclose to the Company as promptly as
available all information known or possessed by him
concerning the rights referred to in the preceding sentence,
and upon request by the Company and without any further
compensation in any form to him by the Company, but at the
expense of the Company, execute all applications for patents
and for copyright registration, assignments thereof and
other instruments and do all things which the Company may
deem necessary to vest and maintain in it the entire right,
title and interest in and to all such rights.
13. Noncompetition; Nonsolicitation.
(a) The Executive covenants and agrees that during the
Noncompetition/ Nonsolicitation Period he shall not at any
time, without the prior written consent of the Company,
directly or indirectly, engage in a Competitive Activity.
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(b) The Executive covenants and agrees that during the
Noncompetition/ Nonsolicitation Period he shall not at any
time, directly or indirectly, solicit (x) any customer or
client of the Company or any Subsidiary with respect to a
Competitive Activity or (y) any employee of the Company or
any Subsidiary for the purpose of causing such employee to
terminate his or her employment with the Company or such
Subsidiary.
(c) The Parties acknowledge that in the event of a
breach or threatened breach of Section 13(a) and/or Section
13(b) above, the Company shall not have an adequate remedy
at law. Accordingly, in the event of any breach or
threatened breach of Section 13(a) and/or Section 13(b)
above and notwithstanding anything to the contrary contained
in Section 25 hereof, the Company shall be entitled, upon
legally sufficient proof thereof, to such equitable and
injunctive relief as may be available from any court of
competent jurisdiction to restrain the Executive and any
business, firm, partnership, individual, corporation or
entity participating in the breach or threatened breach from
the violation of the provisions of Section 13(a) and/or
Section 13(b) above; provided, however, that the Company
shall never assert in any proceeding against the Executive
any claims of "inevitable disclosure." Nothing in this
Agreement (including Section 25 hereof) shall be construed
as prohibiting the Company from pursuing any other remedies
available at law or in equity from any court of competent
jurisdiction for breach or threatened breach of Section
13(a) and/or Section 13(b) above, including the recovery of
damages.
14. Indemnification.
The Company confirms and acknowledges that the Indemnification
Agreement between the Company and the Executive of even date herewith, a copy of
which is attached as Exhibit B hereto (the "Indemnification Agreement"), remains
in full force and effect.
15. Assignability; Binding Nature.
This Agreement shall be binding upon and inure to the benefit of
the Parties and their respective successors, heirs (in the case of the
Executive) and assigns. No rights or obligations of the Company under this
Agreement may be assigned or transferred by the Company except that such rights
or obligations may be assigned or transferred pursuant to any merger or
consolidation in which the Company is not the continuing entity, or the sale or
liquidation of all or substantially all of the assets of the Company; provided,
however, that the assignee or transferee is the successor to all or
substantially all of the assets of the Company and such assignee or transferee
assumes the liabilities, obligations and duties of the Company, as contained in
this Agreement, either contractually or as a matter of law.
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16. Representation.
The Company represents and warrants that it is fully authorized
and empowered to enter into this Agreement and that the performance of its
obligations under this Agreement will not violate any agreement between it and
any other person, firm or organization. The Executive represents and warrants
that no agreement exists between him and any other person, firm or organization
that would be violated by the performance of his obligations under this
Agreement.
17. Entire Agreement.
This Agreement, together with the Equity Grant and the
Indemnification Agreement, contain the entire understanding and agreement
between the Parties concerning the subject matter hereof and supersedes, merges
and voids all prior agreements, understandings, discussions, negotiations and
undertakings, whether written or oral, between the Parties with respect to the
Executive's employment by the Company; provided, however, that all stock options
and/or restricted stock awarded to the Executive prior to the Effective Date and
all agreements relating thereto shall remain in full force and effect in
accordance with their terms except as otherwise modified hereby.
18. Amendment or Waiver.
No provision in this Agreement may be amended unless such
amendment is agreed to in writing and signed by the Executive and an authorized
officer of the Company. No waiver by either Party of any breach by the other
Party of any condition or provision contained in this Agreement to be performed
by such other Party shall be deemed a waiver of a similar or dissimilar
condition or provision at the same or any prior or subsequent time unless such
waiver, by its express terms, so provides. Any waiver must be in writing and
signed by the Executive or an authorized officer of the Company, as the case may
be.
19. Withholding.
The Company may withhold from any amounts payable under this
Agreement such federal, state and local taxes as may be required to be withheld
pursuant to any applicable law or regulation.
20. Severability.
In the event that any provision or portion of this Agreement
shall be determined to be invalid or unenforceable for any reason, in whole or
in part, the remaining provisions of this Agreement shall be unaffected thereby
and shall remain in full force and effect to the fullest extent permitted by
law.
21. Survivorship.
The respective rights and obligations of the Parties hereunder
shall survive any termination of the Executive's employment to the extent
necessary to the intended preservation of such rights and obligations.
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22. Controlling Document.
If any provision of any agreement, plan, program, policy,
arrangement or other written document between or relating to the Company and the
Executive conflicts with any provision of this Agreement, the provision of this
Agreement shall control and prevail.
23. Beneficiaries/References.
The Executive shall be entitled, to the extent permitted under
any applicable law, to select and change a beneficiary or beneficiaries to
receive any compensation or benefit payable hereunder following the Executive's
death by giving the Company written notice thereof. In the event of the
Executive's death or a judicial determination of his incompetence, reference in
this Agreement to the Executive shall be deemed, where appropriate, to refer to
his beneficiary, estate or other legal representative.
24. Governing Law/Jurisdiction.
This Agreement shall be governed by and construed and interpreted
in accordance with the laws of the State of New York without reference to
principles of conflict of laws unless superseded by federal law.
25. Resolution of Disputes.
Any disputes arising under or in connection with this Agreement
shall be resolved by binding arbitration, to be held in New York City in
accordance with the employment rules and procedures of the American Arbitration
Association ("AAA"). The Executive and the Company shall mutually select the
arbitrator from a panel of persons with experience in arbitrating similar
disputes. If the Executive and the Company cannot agree on the selection of an
arbitrator, the AAA shall select such arbitrator. The arbitrator shall hold all
hearings within 45 days after being selected and shall issue a written decision
regarding any award within two weeks after the last hearing date. Judgment upon
the award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. All arbitration costs and all other costs, including but
not limited to reasonable attorneys' fees incurred by each Party, shall be borne
by the Company; provided, however, that if the arbitrator finds that the
Executive's claims are frivolous or without merit, then the arbitration costs
shall be shared equally by both Parties and all other costs shall be borne by
the Party incurring such cost.
26. Notices.
All notices shall be in writing, shall be sent to the following
addresses listed below using a reputable overnight express delivery service, and
shall be deemed to be received when sent.
If to the Company: 909 Third Avenue, 19th Floor
New York, New York 10022
Attention: General Counsel
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If to the Executive: at the address listed on the
Company's payroll records for Executive's
state of residency for income tax purposes.
27. Headings.
The headings of the sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.
28. Compliance with Code Section 409A.
To the extent applicable, this Agreement shall be interpreted in
accordance with Section 409A of the Code and Department of Treasury regulations
and other interpretive guidance issued thereunder, including without limitation
any such regulations or guidance that may be issued after the Effective Date.
Notwithstanding any provision of the Agreement to the contrary, in the event
that the Company or the Compensation Committee determines that any amounts
payable hereunder will be immediately taxable to the Executive under Section
409A of the Code and related Department of Treasury guidance (or subject the
Executive to a penalty tax), the Company may (a) adopt such amendments to the
Agreement, including amendments with retroactive effect, that the Company or
Compensation Committee determines necessary or appropriate to preserve the
intended tax treatment of the benefits provided by the Agreement and/or (b) take
such other actions as the Company or the Compensation Committee determines
necessary or appropriate to comply with the requirements of Section 409A of the
Code and related Department of Treasury guidance, including such Department of
Treasury guidance and other interpretive materials as may be issued after the
Effective Date.
29. Counterparts.
This Agreement may be executed in two or more counterparts, and
such counterparts shall constitute one and the same instrument. Signatures
delivered by facsimile shall be deemed effective for all purposes to the extent
permitted under applicable law.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement
as of the date first written above.
COMVERSE TECHNOLOGY, INC.
By: /s/ Avi T. Aronovitz
--------------------------------
Name: Avi T. Aronovitz
Title: Interim Chief Financial
Officer, Vice President
of Finance and Treasurer
/s/ Raz Alon
------------------------------------
Raz Alon
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EXHIBIT A
RELEASE
This RELEASE ("Release") dated as of ____________________ between
Comverse Technology, Inc., a New York corporation (the "Company"), and Raz Alon
(the "Executive").
WHEREAS, the Company and the Executive previously entered into an
employment agreement dated July 14, 2006 under which the Executive was employed
to serve as the Company's Chief Executive Officer (the "Employment Agreement");
and
WHEREAS, the Executive's employment with the Company (has been) (will
be) terminated effective
__________________; and
WHEREAS, pursuant to Section 11 of the Employment Agreement, the
Executive is entitled to certain compensation and benefits upon such
termination, contingent upon the execution of this Release;
NOW, THEREFORE, in consideration of the premises and mutual agreements
contained herein and in the Employment Agreement, the Company and the Executive
agree as follows:
1. The Executive, on his own behalf and on behalf of his heirs, estate
and beneficiaries, does hereby release the Company, and any of its Subsidiaries
or affiliates, and each past or present officer, director, agent, employee,
shareholder, and insurer of any such entities, from any and all claims made, to
be made, or which might have been made of whatever nature, whether known or
unknown, from the beginning of time, including those that arose as a consequence
of his employment with the Company, or arising out of the severance of such
employment relationship, or arising out of any act committed or omitted during
or after the existence of such employment relationship, all up through and
including the date on which this Release is executed, including, but not limited
to, those which were, could have been or could be the subject of an
administrative or judicial proceeding filed by the Executive or on his behalf
under federal, state or local law, whether by statute, regulation, in contract
or tort, and including, but not limited to, every claim for front pay, back pay,
wages, bonus, fringe benefit, any form of discrimination (including but not
limited to, every claim of race, color, sex, religion, national origin,
disability or age discrimination), wrongful termination, emotional distress,
pain and suffering, breach of contract, compensatory or punitive damages,
interest, attorney's fees, reinstatement or reemployment. If any court rules
that such waiver of rights to file, or have filed on his behalf, any
administrative or judicial charges or complaints is ineffective, the Executive
agrees not to seek or accept any money damages or any other relief upon the
filing of any such administrative or judicial charges or complaints. The
Executive relinquishes any right to future employment with the Company and the
Company shall have the right to refuse to re-employ the Executive, in each case
without liability of the Executive or the Company. The Executive acknowledges
and agrees that even though claims and facts in addition to those now known or
believed by him to exist may subsequently be discovered, it is his intention to
16
<PAGE>
fully settle and release all claims he may have against the Company and the
persons and entities described above, whether known, unknown or suspected.
2. The Company and the Executive acknowledge and agree that the release
contained in Paragraph 1 does not, and shall not be construed to, release or
limit the scope of any existing obligation of the Company (i) to indemnify the
Executive for his acts as an officer or director of Company in accordance with
the bylaws of Company and the Indemnification Agreement (as defined in Section
14 of the Employment Agreement), or (ii) to the Executive and his eligible,
participating dependents or beneficiaries under any existing group welfare or
retirement plan of the Company in which the Executive and/or such dependents are
participants.
3. The Executive acknowledge that he has been provided at least 21 days
to review the Release and has been advised to review it with an attorney of his
choice. In the event the Executive elects to sign this letter agreement prior to
this 21 day period, he agrees that it is a knowing and voluntary waiver of his
right to wait the full 21 days. The Executive further understand that he has
seven days after the signing hereof to revoke it by so notifying the Company in
writing, such notice to be received by _____________ within the 7 day period.
The Executive further acknowledge that he has carefully read this Release, knows
and understands its contents and its binding legal effect. The Executive
acknowledge that by signing this Release, he does so of his own free will and
act and that it is his intention that he be legally bound by its terms.
IN WITNESS WHEREOF, the parties have executed this Release on the date
first above written.
COMVERSE TECHNOLOGY, INC.
By:
--------------------------------
Name:
Title:
-----------------------------------
Raz Alon