EXHIBIT 10.16
FEBRUARY 25, 1999
Xxxxxx X. Xxxxxx
TeleTech
0000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, Xxxxxxxx 00000-0000
RE: LETTER AGREEMENT
Dear Xxxxx:
I am writing to confirm your agreement with TeleTech Holdings, Inc.
("TeleTech") regarding the amendment of your employment agreement:
1. EFFECTIVE DATE OF THIS AGREEMENT. The Effective Date of this Agreement
shall be deemed to be January 1, 1999.
2. TERM. The term of this Agreement shall be 3 years from the Effective Date
("Term").
3. JOB RESPONSIBILITIES. Your job duties and responsibilities as Chief
Financial Officer with TeleTech, which are set forth more fully in your
Employment Agreement, dated as of April 1, 1996 ("Employment Agreement")
shall remain as provided in such Employment Agreement.
4. BASE SALARY. Subject to the terms and conditions of this Agreement, as of
the Effective Date, your Annual Base Salary shall be $250,000.00.
5. BONUS. You will be eligible to receive an Annual Discretionary Bonus of up
to 50% of your Annual Base Salary, of which $50,000.00 shall be guaranteed.
6. ADDITIONAL STOCK OPTIONS. You will be entitled to 120,000 additional
Non-Qualified Stock Options upon the following terms and conditions:
a. STRIKE PRICE. $6.00 per share;
b. VESTING. Except as otherwise provided herein, these stock options
will vest in equal monthly installments over a 3-year period,
beginning as of the Effective Date, and continuing thereafter, as long
as you remained employed by TeleTech.
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c. EXERCISE DATE. Subject to the restrictions of the securities laws and
other applicable rules and regulations, only vested stock options are
exercisable. Except as otherwise provided herein, any stock options
which are not vested on the date of termination of your employment for
any reason shall be null, void and of no effect.
d. STOCK PLAN. The stock options granted by this Agreement shall be
subject to TeleTech's Stock Plan as may be amended from time-to-time.
e. CHANGE OF CONTROL. In the event of a Change of Control, all of your
unvested stock options (including any unvested stock options
previously granted to you pursuant to the TeleTech Holdings, Inc.
Non-Qualified Stock Option Agreement dated as of September 7, 1995
(the "Non-Qualified Stock Option Agreement"), as well as any unvested
options granted to you pursuant to this Agreement) will immediately
vest and become exercisable. The meaning of "Change of Control" shall
be as set forth in EXHIBIT 1 attached hereto.
f. NOTICE OF INTENT TO EXERCISE TELETECH OPTIONS OR SELL TELETECH SHARES.
Prior to exercising any vested options or selling any shares owned by
you, you must give TeleTech written notice that you intend to do so.
7. ADDITIONAL FRINGE BENEFITS. You will receive health insurance, vacations
and other employee benefits that are generally made available to executive
employees. In addition, you shall receive life insurance benefits in
amounts not less than $4,000,000.00.
8. OTHER EXISTING AGREEMENTS. Except for those provisions which have been
deleted or modified on the copies attached as Exhibits hereto or as
provided herein, and except as otherwise specifically inconsistent with the
provisions of this Agreement, the parties hereto reaffirm their agreement
to and the effectiveness of the following agreements:
A. The Letter Agreement dated as of September 5, 1995, which is attached
hereto as EXHIBIT 2;
B. The Employment Agreement dated as of April 1, 1996, which is attached
hereto as EXHIBIT 3, (except for paragraph 13.4, which shall be
replaced with the following language: "The Arbitrator's fees shall
be borne by the Company. Notwithstanding the above, the Arbitrator
shall have the discretion to require the losing party to reimburse the
prevailing party for the Arbitrator's fees paid by the prevailing
party");
C. The TeleTech Holdings, Inc. Non-Qualified Stock Option Agreement dated
as of September 7, 1995, which is attached hereto as EXHIBIT 4 (the
"Non-Qualified Stock Option Agreement");
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D. The Special Release and Covenant executed in 1996, which is attached
hereto as EXHIBIT 5, and which you expressly ratify and affirm as in
full force and effect as of the date that you execute this Agreement;
E. The Agreement for At-Will Employment dated as of June 21, 1996, which
is attached hereto as EXHIBIT 6;
F. The Arbitration Agreement dated as of June 22, 1995, which is attached
hereto as EXHIBIT 7 (except for paragraph 10.2, which shall be
replaced with the following language: "The Arbitrator's fees shall
be borne by the Company. Notwithstanding the above, the Arbitrator
shall have the discretion to require the losing party to reimburse the
prevailing party for the Arbitrator's fees paid by the prevailing
party");
G. The Employee Proprietary Information and Invention Agreement dated as
of June 6, 1995, which is attached hereto as EXHIBIT 8;
H. The Confidentiality Agreement dated as of January 10, 1996, which is
attached hereto as EXHIBIT 9; and
I. The miscellaneous agreements executed by you in connection with your
employment, which are attached hereto as EXHIBIT 10.
Each of these agreements shall be deemed to be incorporated into this
Agreement by reference.
9. PAST COMPENSATION. You agree that, except for compensation due to you
under this Agreement, the Non-Qualified Stock Options due to you under the
terms and conditions and vesting schedules of the Non-Qualified Stock
Option Agreement and any unused vacation time, you are owed no additional
compensation of any type whatsoever for any period prior to and up to the
Effective Date.
10. SEVERANCE IN THE EVENT OF TERMINATION BY TELETECH WITHOUT CAUSE. In the
event that you are terminated by TeleTech without cause (i.e., for any
reason other than for the reasons specifically identified as Termination
"For Cause" in paragraph 11 hereof), you shall receive severance benefits
equal to: (a) 6 months of your Annual Base Salary (i.e., $125,000.00); and
(b) a 6-month pro-rata share of all of the Annual Discretionary Bonus for
which you are eligible (i.e., $62,500.00); and (c) the immediate vesting of
any stock options that are scheduled to vest in accordance with the vesting
schedules of the Non-Qualified Stock Option Agreement and this Agreement
within 13 months after the date of your termination. In this regard, you
agree to execute a reasonable and mutually agreeable separation agreement
and mutual release and other related documents in connection with
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your receipt of the severance benefits contained herein.
11. TERMINATION "FOR CAUSE." For purposes of this Agreement, termination by
TeleTech "For Cause" shall be deemed to consist of the following: (a) the
willful refusal to perform your duties as Chief Financial Officer; (b) the
breach of this Agreement; (c) fraud, theft, embezzlement, conviction of a
felony (or a misdemeanor resulting or intended to result in gain or
personal enrichment at the expense of TeleTech); or (d) violations of any
laws or regulations in the conduct of TeleTech's business or on TeleTech's
premises.
12. AT-WILL EMPLOYMENT. You agree that your employment at TeleTech as of and
after the Effective Date of this Agreement shall be "At-Will" and may be
terminated by either Party at any time with or without notice and with or
without cause. Nothing contained herein or otherwise shall be deemed to be
a commitment to or guarantee of future employment.
13. RELEASE OF CLAIMS. Except as otherwise provided in this Agreement, for and
in consideration of the benefits provided herein and your continued
employment hereunder, you on behalf of yourself and any heirs and
dependents, executors, administrators and assigns hereby release and
discharge TeleTech and any of its shareholders, officers, directors,
partners, employees, agents, contractors, attorneys, assigns, parent
companies, subsidiary companies, affiliates, predecessors-in-interest,
successors and assigns (hereinafter, "Releasees") from any and all rights,
claims, causes of action, liability, damages, attorney?s fees and costs of
any kind or nature, whether known or unknown, which you ever had or now
have against Releasees by reason of any actual or alleged act, omission,
transaction, practice, conduct, occurrence or other matter occurring up to
and including the date of this agreement and arising out of, connected with
or incidental to your employment with TeleTech. FOR PURPOSES OF THIS
SECTION, YOU ACKNOWLEDGE THAT THIS RELEASE OF CLAIMS IS EFFECTIVE AS OF THE
DATE OF EXECUTION HEREOF and not as of the Effective Date as defined
herein.
13. MISCELLANEOUS.
a. The parties agree that this Agreement is fair and reasonable and has
been entered into freely and voluntarily after good faith, arms length
negotiations.
b. You agree that you have been advised to seek independent counsel
regarding the terms and conditions and the negotiation of this
Agreement.
c. You agree that you are the owner of any claims, etc. released by this
Agreement and that you have not assigned any claims, etc. related to
TeleTech to anyone.
d. The parties agree that, in entering into this Agreement, they have not
relied upon any representations, warranties, promises and/or any
conditions made
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by the other party which are not specifically set forth in this
Agreement.
e. This Agreement will be governed by Colorado law.
f. This Agreement was negotiated and drafted jointly.
g. This Agreement, including the Exhibits, contains the entire agreement
between the parties relating to its subject matter, supersedes all
prior agreements, negotiations, and oral understandings, if any, and
may not be amended, supplemented, or discharged, except by an
instrument in writing signed by each of the parties.
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h. The parties agree that there are no collateral oral agreements between
them with respect to the subject matter of this Agreement, or
otherwise.
ACCEPTED AND AGREED TO:
TELETECH
/s/ Xxxxxxx X. Xxxxxxx
--------------------------------------
XXXXXXX X. XXXXXXX
PRESIDENT AND
CHIEF EXECUTIVE OFFICER
/s/ Xxxxxx X. Xxxxxx
--------------------------------------
XXXXXX X. XXXXXX
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EXHIBIT 1
CHANGE OF CONTROL
For purposes of this Agreement, "Change of Control" shall mean the any of
the following:
(i) any consolidation, merger or other similar transaction (A)
involving TeleTech, if TeleTech is not the continuing or surviving
corporation, or (B) which contemplates that all or substantially all of the
business and/or assets of TeleTech will be controlled by another corporation;
(ii) any sale, lease, exchange or transfer (in one transaction or
series of related transactions) of all or substantially all of the assets of
TeleTech;
(iii) approval by the stockholders of TeleTech of any plan or
proposal for the liquidation or dissolution of TeleTech, unless such plan or
proposal is abandoned within 60 days following such approval;
(iv) the acquisition by any "person" (as such term is used in
Sections 13(d) and 14(d)(2) of the Exchange Act), or two or more persons
acting in concert, of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 40% or more of the outstanding shares
of voting stock of TeleTech; provided, however, that for purposes of the
foregoing, "person" excludes Xxxxxxx X. Xxxxxxx and his affiliates; or
(v) if, during any period of 15 consecutive calendar months
commencing on the date of this Agreement, those individuals (the "CONTINUING
DIRECTORS") who either (A) were directors of TeleTech on the first day of
each such period, or (B) subsequently became directors of TeleTech and whose
actual election or initial nomination for election subsequent to that date
was approved by a majority of the Continuing Directors then on the board of
directors of TeleTech, cease to constitute a majority of the board of
directors of TeleTech.
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