1
EXHIBIT 10.19
VOICETEK CORPORATION
1997 Employee Stock Purchase Plan
1. Purpose
It is the purpose of this 1997 Employee Stock Purchase Plan to provide a
means whereby eligible employees may purchase Common Stock of Voicetek
Corporation (the "Company") and any subsidiaries as defined below through
after-tax payroll deductions. It is intended to provide a further incentive for
employees to promote the best interests of the Company and to encourage stock
ownership by employees in order that they may participate in the Company's
economic growth.
It is the intention of the Company that the Plan qualify as an "employee
stock purchase plan" within the meaning of Section 423 of the Internal Revenue
Code and the provisions of this Plan shall be construed in a manner consistent
with the Code and Treasury Regulations promulgated thereunder.
2. Definitions
The following words or terms, when used herein, shall have the following
respective meanings:
(a) "Plan" shall mean the 1996 Employee Stock Purchase Plan.
(b) "Company" shall mean Voicetek Corporation, a Massachusetts
corporation.
(c) "Account" shall mean the Employee Stock Purchase Account
established for a Participant under Section 7 hereunder.
(d) "Basic Compensation" shall mean the regular rate of salary or
wages in effect immediately prior to a Purchase Period, before any
deductions or withholdings, and
2
including overtime, bonuses and sales commissions, but excluding
amounts paid in reimbursement for expenses.
(e) "Board of Directors" shall mean the Board of Directors of Voicetek
Corporation.
(f) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(g) "Committee" shall mean the Compensation Committee appointed by the
Board of Directors.
(h) "Common Stock" shall mean shares of the Company's common stock,
$.01 par value per share.
(i) "Effective Date" shall mean the date of the closing of the
Company's first public offering of Common Stock made pursuant to
an effective Registration Statement filed with the Securities and
Exchange Commission.
(j) "Eligible Employees" shall mean all persons employed by the
Company or one of its Subsidiaries, but excluding:
(1) Persons who have been employed by the Company or its
Subsidiaries for less than six months on the first day of the
Purchase Period;
(2) Persons whose customary employment is less than twenty hours
per week or five months or less per year; and
(3) Persons who are deemed for purposes of Section 423(b)(3) of
the Code to own stock possessing 5% or more of the total
combined voting power or value of all classes of stock of the
Company or a subsidiary.
For purposes of the Plan, employment will be treated as continuing
intact while a Participant is on military leave, sick leave, or other bona fide
leave of absence, for up to 90 days
- 2 -
3
or so long as the Participant's right to re-employment is guaranteed either by
statute or by contract, if longer than 90 days.
(k) "Exercise Date" shall mean the last day of a Purchase Period;
provided, however, that if such date is not a business day,
"Exercise Date" shall mean the immediately preceding business day.
(l) "Participant" shall mean an Eligible Employee who elects to
participate in the Plan under Section 6 hereunder.
(m) Except as provided below, there shall be two "Purchase Periods" in
each full calendar year during which the Plan is in effect, one
commencing on January 1 of each calendar year and continuing
through June 30 of such calendar year, and the second commencing
on July 1 of each calendar year and continuing through December 31
of such calendar year. The first Purchase Period after the
Effective Date of the Plan shall commence on July 1, 1997. The
last Purchase Period shall commence on January 1, 2007 and end on
June 30, 2007.
(n) "Purchase Price" shall mean the lower of (i) 85% of the fair
market value of a share of Common Stock for the first business day
of the relevant Purchase Period, or (ii) 85% of such value on the
relevant Exercise Date. If the shares of Common Stock are listed
on any national securities exchange, or traded on the National
Association of Securities Dealers Automated Quotation System
("Nasdaq") National Market System, the fair market value per share
of Common Stock on a particular day shall be the closing price, if
any, on the largest such exchange, or if not traded on an
exchange, the Nasdaq National Market System, on such day, and,
- 3 -
4
if there are no sales of the shares of Common Stock on such
particular day, the fair market value of a share of Common Stock
shall be determined by taking a weighted average of the means
between the highest and lowest sales on the nearest date before
and the nearest date after the particular day in accordance with
Treasury Regulations Section 25.2512-2. If the shares of Common
Stock are not then listed on any such exchange or the Nasdaq
National Market System, the fair market value per share of Common
Stock on a particular day shall be the mean between the closing
"Bid" and the closing "Asked" prices, if any, as reported in the
National Daily Quotation Service for such day. If the fair market
value cannot be determined under the preceding sentences, it shall
be determined in good faith by the Board of Directors.
(o) "Subsidiary" shall mean any present or future corporation which
(i) would be a "subsidiary corporation" of the Company as that
term is defined in Section 424(f) of the Code and (ii) is
designated as a participant in the Plan by the Board.
3. Grant of Option to Purchase Shares.
Each Eligible Employee shall be granted an option effective on the first
business day of each Purchase Period to purchase shares of Common Stock. The
term of the option shall be the length of the Purchase Period. The number of
shares subject to each option shall be the quotient of the aggregate payroll
deductions in the Purchase Period authorized by each Participant in accordance
with Section 6 divided by the Purchase Price, but in no event greater than 2,000
shares per option, or such other number as determined from time to time by the
Board of Directors or the Committee (the "Share Limitation"). Notwithstanding
the foregoing, no
- 4 -
5
employee shall be granted an option which permits his right to purchase shares
under the Plan to accrue at a rate which exceeds in any one calendar year
$25,000 of the fair market value of the Common Stock as of the date the option
to purchase is granted.
4. Shares.
There shall be 250,000 shares of Common Stock reserved for issuance to
and purchase by Participants under the Plan, subject to adjustment as herein
provided. The shares of Common Stock subject to the Plan shall be either shares
of authorized but unissued Common Stock or shares of Common Stock reacquired by
the Company and held as treasury shares. Shares of Common Stock not purchased
under an option terminated pursuant to the provisions of the Plan may again be
subject to options granted under the Plan.
The aggregate number of shares of Common Stock which may be purchased
pursuant to options granted hereunder, the number of shares of Common Stock
covered by each outstanding option, and the purchase price for each such option
shall be appropriately adjusted for any increase or decrease in the number of
outstanding shares of Common Stock resulting from a stock split or other
subdivision or consolidation of shares of Common Stock or for other capital
adjustments or payments of stock dividends or distributions or other increases
or decreases in the outstanding shares of Common Stock effected without receipt
of consideration by the Company.
5. Administration.
The Plan shall be administered by the Board of Directors or the
Compensation Committee appointed from time to time by the Board of Directors.
The Board of Directors or the Committee, if one has been appointed, is vested
with full authority to make, administer and interpret such equitable rules and
regulations regarding the Plan as it may deem advisable. The
- 5 -
6
Board of Directors', or the Committee's, if one has been appointed,
determinations as to the interpretation and operation of the Plan shall be final
and conclusive. No member of the Board of Directors or the Committee shall be
liable for any action or determination made in good faith with respect to the
Plan or any option granted under the Plan.
6. Election to Participate.
An Eligible Employee may elect to become a Participant in the Plan for a
Purchase Period by completing a "Stock Purchase Agreement" form prior to the
first day of the Purchase Period for which the election is made. Such Stock
Purchase Agreement shall be in such form as shall be determined by the Board of
Directors or the Committee. The election to participate shall be effective for
the Purchase Period for which it is made. There is no limit on the number of
Purchase Periods for which an Eligible Employee may elect to become a
Participant in the Plan. In the Stock Purchase Agreement, the Eligible Employee
shall authorize regular payroll deductions of any full percentage of his Basic
Compensation, but in no event less than one percent (1%) nor more than ten
percent (10%) of his Basic Compensation, not to exceed $25,000 per year. An
Eligible Employee may not change his authorization except as otherwise provided
in Section 9. Options granted to Eligible Employees who have failed to execute a
Stock Purchase Agreement within the time periods prescribed by the Plan will
automatically lapse.
7. Employee Stock Purchase Account.
An Employee Stock Purchase Account will be established for each
Participant in the Plan for bookkeeping purposes, and payroll deductions made
under Section 6 will be credited to such Accounts. However, prior to the
purchase of shares in accordance with Section 8 or withdrawal from or
termination of the Plan in accordance with the provisions hereof, the Company
may use
- 6 -
7
for any valid corporate purpose all amounts deducted from a Participant's wages
under the Plan and credited for bookkeeping purposes to his Account.
The Company shall be under no obligation to pay interest on funds
credited to a Participant's Account, whether upon purchase of shares in
accordance with Section 8 or upon distribution in the event of withdrawal from
or termination of the Plan as herein provided.
8. Purchase of Shares.
Each Eligible Employee who is a Participant in the Plan automatically
and without any act on his part will be deemed to have exercised his option on
each Exercise Date to the extent that the balance then in his Account under the
Plan is sufficient to purchase at the Purchase Price whole shares of the Common
Stock subject to his option, subject to the Share Limitations and the Section
423(b)(8) limitation described in Section 3. Any balance remaining in the
Participant's Account shall be refunded to him in cash without interest.
9. Withdrawal.
A Participant who has elected to authorize payroll deductions for the
purchase of shares of Common Stock may cancel his election by written notice of
cancellation ("Cancellation") delivered to the office or person designated by
the Company to receive Stock Purchase Agreements, but any such notice of
Cancellation must be so delivered not later than ten (10) days before the
relevant Exercise Date.
A Participant will receive in cash, as soon as practicable after
delivery of the notice of Cancellation, the amount credited to his Account. Any
Participant who so withdraws from the Plan may again become a Participant at the
start of the next Purchase Period in accordance with Section 6.
- 7 -
8
Upon dissolution or liquidation of the Company every option outstanding
hereunder shall terminate, in which event each Participant shall be refunded the
amount of cash then in his Account. If the Company shall at any time merge into
or consolidate with another corporation, the holder of each option then
outstanding will thereafter be entitled to receive at the next Exercise Date,
upon exercise of such option and for each share as to which such option was
exercised, the securities or property which a holder of one share of the Common
Stock was entitled upon and at such time of such merger or consolidation. In
accordance with this paragraph and this Plan, the Board of Directors or
Compensation Committee, if any, shall determine the kind or amount of such
securities or property which such holder of an option shall be entitled to
receive. A sale of all or substantially all of the assets of the Company shall
be deemed a merger or consolidation for the foregoing purposes.
10. Issuance of Stock Certificates.
The shares of Common Stock purchased by a Participant shall, for all
purposes, be deemed to have been issued and sold at the close of business on the
Exercise Date. Prior to that date none of the rights or privileges of a
shareholder of the Company, including the right to vote or receive dividends,
shall exist with respect to such shares.
Within a reasonable time after the Exercise Date, the Company shall
notify the transfer agent and registrar of the Common Stock of the Participant's
ownership of the number of shares of Common Stock purchased by a Participant for
the Purchase Period, which shall be registered either in the Participant's name
or jointly in the names of the Participant and his spouse with right of
survivorship as the Participant shall designate in his Stock Purchase Agreement.
Such
- 8 -
9
designation may be changed at any time by filing notice thereof with the party
designated by the Company to receive such notices.
11. Termination of Employment.
(a) Upon a Participant's termination of employment for any reason,
other than death, no payroll deduction may be made from any
compensation due him and the entire balance credited to his
Account shall be automatically refunded, and his rights under the
Plan shall terminate.
(b) Upon the death of a Participant, no payroll deduction shall be
made from any compensation due him at time of death, the entire
balance in the deceased Participant's Account shall be paid in
cash to the Participant's designated beneficiary, if any, under a
group insurance plan of the Company covering such employee, or
otherwise to his estate, and his rights under the Plan shall
terminate.
12. Rights Not Transferable.
The right to purchase shares of Common Stock under this Plan is
exercisable only by the Participant during his lifetime and is not transferable
by him. If a Participant attempts to transfer his right to purchase shares under
the Plan, he shall be deemed to have requested withdrawal from the Plan and the
provisions of Section 9 hereof shall apply with respect to such Participant.
13. No Guarantee of Continued Employment.
Granting of an option under this Plan shall imply no right of continued
employment with the Company for any Eligible Employee.
- 9 -
10
14. Notice.
Any notice which an Eligible Employee or Participant files pursuant to
this Plan shall be in writing and shall be delivered personally or by mail
addressed to Voicetek Corporation, 19 Alpha Road, Chelmsford, MA 01824, Attn:
Sheldon L. Dinkes. Any notice to a Participant or an Eligible Employee shall be
conspicuously posted in the Company's principal office or shall be mailed
addressed to the Participant or Eligible Employee at the address designated in
the Stock Purchase Agreement or in a subsequent writing.
15. Application of Funds.
All funds deducted from a Participant's wages in payment for shares
purchased or to be purchased under this Plan may be used for any valid corporate
purpose provided that the Participant's Account shall be credited with the
amount of all payroll deductions as provided in Section 7.
16. Government Approvals or Consents.
This Plan and any offering and sales to Eligible Employees under it are
subject to any governmental approvals or consents that may be or become
applicable in connection therewith. Subject to the provisions of Section 17, the
Board of Directors of the Company may make such changes in the Plan and include
such terms in any offering under this Plan as may be necessary or desirable, in
the opinion of counsel, to comply with the rules or regulations of any
governmental authority, or to be eligible for tax benefits under the Code or the
laws of any state.
17. Amendment of the Plan.
The Board of Directors may, without the consent of the Participants,
amend the Plan at any time, provided that no such action shall adversely affect
options theretofore granted hereunder,
- 10 -
11
and provided that no such action by the Board of Directors without approval of
the Company's shareholders may (a) increase the total number of shares of Common
Stock which may be purchased by all Participants, (b) change the class of
employees eligible to receive options under the Plan, or (c) make any changes to
the Plan which require shareholder approval under applicable law or regulations,
including Section 423 of the Code and the regulations promulgated thereunder.
For purposes of this Section 17, termination of the Plan by the Board of
Directors pursuant to Section 18 shall not be deemed to be an action which
adversely affects options theretofore granted hereunder.
18. Term of the Plan.
The Plan shall become effective on the Effective Date, provided that it
is approved within twelve months after adoption by the Board of Directors by the
affirmative vote of holders of a majority of the stock of the Company present or
represented and entitled to vote at a duly held shareholders' meeting. The Plan
shall continue in effect through June 30, 2007, provided, however, that the
Board of Directors shall have the right to terminate the Plan at any time, but
such termination shall not affect options then outstanding under the Plan. It
will terminate in any case when all or substantially all of the unissued shares
of stock reserved for the purposes of the Plan have been purchased. If at any
time shares of stock reserved for the purposes of the Plan remain available for
purchase but not in sufficient number to satisfy all then unfilled purchase
requirements, the available shares shall be apportioned among Participants in
proportion to the amount of payroll deductions accumulated on behalf of each
Participant that would otherwise be used to purchase stock and the Plan shall
terminate. Upon such termination or any other
- 11 -
12
termination of the Plan, all payroll deductions not used to purchase stock will
be refunded, without interest.
19. Notice to Company of Disqualifying Disposition; Legend.
By electing to participate in the Plan, each Participant agrees to
notify the Company in writing immediately after the Participant transfers Common
Stock acquired under the Plan, if such transfer occurs within two years after
the first business day of the Purchase Period in which such Common Stock was
acquired. Each Participant further agrees to provide any information about such
a transfer as may be requested by the Company or any subsidiary corporation in
order to assist it in complying with the tax laws. Such dispositions generally
are treated as "disqualifying dispositions" under Sections 421 and 424 of the
Code, which have certain tax consequences to Participants and to the Company and
its participating Subsidiaries. The Participant further agrees that all stock
certificates for Common Stock purchased under the Plan by the Participant shall
be held in his name or jointly with his spouse, as the case may be, and not in
the name of a broker, nominee or other person or entity for such two-year
period, and agrees that such stock certificates shall bear a legend reflecting
that such Common Stock was obtained upon the purchase of Common Stock under the
Plan. The Participant acknowledges that the Company may send a Form W-2, or
substitute therefor, as appropriate, to the Participant with respect to any
income recognized by the Participant upon a disqualifying disposition of Common
Stock.
20. Withholding of Additional Income Taxes.
By electing to participate in the Plan, each Participant acknowledges
that the Company and its participating Subsidiaries are required to withhold
taxes with respect to the amounts deducted
- 12 -
13
from the Participant's compensation and accumulated for the benefit of the
Participant under the Plan and each Participant agrees that the Company and its
participating Subsidiaries may deduct additional amounts from the Participant's
compensation, when amounts are added to the Participant's account, used to
purchase Common Stock or refunded, in order to satisfy such withholding
obligations. Each Participant further acknowledges that when Common Stock is
purchased under the Plan, the Company and its participating Subsidiaries may be
required to withhold taxes with respect to all or a portion of the difference
between the fair market value of the Common Stock purchased and its purchase
price, and each Participant agrees that such taxes may be withheld from
compensation otherwise payable to such Participant. It is intended that tax
withholding will be accomplished in such a manner that the full amount of
payroll deductions elected by the Participant under Section 6 will be used to
purchase Common Stock. However, if amounts sufficient to satisfy applicable tax
withholding obligations have not been withheld from compensation otherwise
payable to any Participant, then, notwithstanding any other provision of the
Plan, the Company may withhold such taxes from the Participant's accumulated
payroll deductions and apply the net amount to the purchase of Common Stock,
unless the Participant pays to the Company, prior to the exercise date, an
amount sufficient to satisfy such withholding obligations. Each Participant
further acknowledges that the Company and its participating Subsidiaries may be
required to withhold taxes in connection with the disposition of stock acquired
under the Plan and agrees that the Company or any participating subsidiary may
take whatever action it considers appropriate to satisfy such withholding
requirements, including deducting from compensation otherwise payable to such
Participant an amount sufficient to satisfy such withholding requirements or
conditioning any disposition of Common Stock by the
- 13 -
14
Participant upon the payment to the Company or such subsidiary of an amount
sufficient to satisfy such withholding requirements.
21. General.
Whenever the context of this Plan permits, the masculine gender shall
include the feminine and neuter genders.
Adopted by the Board of Directors __________________.
Approved by the Stockholders ___________________.
- 14 -