EXHIBIT 10.28

INTERACTIVE INTELLIGENCE, INC.
EMPLOYEE STOCK PURCHASE PLAN

(As Amended)

 

Section 1. Designation and Purpose of Plan. The name of this Plan is the
Interactive Intelligence, Inc. Employee Stock Purchase Plan. The purpose of the
Plan is to provide incentives, through the ownership of Company common stock,
for employees to enhance Company performance through their services. The Plan is
intended to comply, and should be interpreted where possible to comply, with the
terms of Code section 423.

 

Section 2. Definitions. As used in the Plan, the following terms, when
capitalized, have the following meanings:

 

(a) “Agent” means Norwest Bank Minnesota, N.A., or any successor agent selected
by the Company.

 

(b) “Beneficiary” means, with respect to a Participant, the individual or estate
designated, pursuant to Section 11, to receive the Participant’s Payroll
Deduction Account balance and Investment Account assets in the event of the
Participant’s death.

 

(c) “Board” means the Board of Directors of the Company.

 

(d) “Code” means the Internal Revenue Code of 1986, as amended from time to
time, and its interpretive rules and regulations.

 

(e) “Committee” means the Employee Stock Purchase Plan Committee established
pursuant to Section 12 to administer the Plan.

 

(f) “Common Stock” means the Company’s common stock, $0.01 par value.

 

(g) “Company” means Interactive Intelligence, Inc. and any successor by merger,
consolidation or otherwise.

 

(h) “Compensation” means, with respect to an Eligible Employee for a calendar
year, the Eligible Employee’s wages, salary, commissions, bonuses, and other
remuneration for services, including salary reduction contributions pursuant to
elections under a plan subject to Code sections 125 or 401(k).

 

(i) “Designated Subsidiary” means any Subsidiary of the Company that is
designated from time to time by the Committee to permit the employees of that
Subsidiary to participate in the Plan.

 

(j) “Effective Date” means April 1, 2000, subject to approval of the Plan by the
Company’s shareholders within 12 months of the Plan’s adoption.

 

(k) “Eligible Employee” means any employee of the Company or any Designated
Subsidiary that meets the eligibility requirements of Section 4.

 

(l) “Enrollment Form” means the form filed with the Committee authorizing
payroll deductions pursuant to Section 5.

 

(m) “Entry Date” means the first day of each calendar quarter that coincides
with or follows the Effective Date.

 

(n) “Fair Market Value” means, with respect to any Investment Date, the lower
closing price, as reported on The Nasdaq Stock Market, on the first or last
business day of the immediately preceding calendar quarter.

 

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(o) “Investment Account” means the account established for each Participant to
hold Common Stock purchased under the Plan pursuant to Section 6.

 

(p) “Investment Date” means the first business day of each calendar quarter
after the Effective Date, on which shares of Common Stock are or could be traded
on The Nasdaq Stock Market.

 

(q) “Participant” means an Eligible Employee who elects to participate in the
Plan by filing an Enrollment Form pursuant to Section 5 and who has not ceased
to participate in the Plan pursuant to Section 10.

 

(r) “Payroll Deduction Account” means the account established for a Participant
to hold payroll deductions pursuant to Section 5.

 

(s) “Plan” means this instrument and the employee stock purchase plan
established by this instrument.

 

(t) “Purchase Price” means the price for each whole and fractional share of
Common Stock, including those purchased by dividend reinvestment, which shall be
85% of the Fair Market Value of such whole or fractional share as of the
Investment Date.

 

(u) “Subsidiary” means any corporation which is a “subsidiary corporation” of
the Company as such term is defined in Section 424 of the Code.

 

Section 3. Shares Reserved for the Plan. The Company shall reserve for issuance
and purchase by employees under the Plan an aggregate of 750,000 shares of
Common Stock, subject to adjustment as provided in Section 14. Shares subject to
the Plan shall be authorized but unissued shares, treasury shares or shares
purchased on the open market or in private transactions. Shares needed to
satisfy the Plan may be acquired from the Company or by purchases at the
Company’s expense on the open market or in private transactions.

 

Section 4. Eligible Employees. All employees of the Company or any Designated
Subsidiary are eligible to participate in the Plan, except the following:

 

(a) any employee who had not been employed for more than 30 days prior to the
Entry Date;

 

(b) any employee whose customary employment is 20 hours or less per week; and

 

(c) any employee whose customary employment is for not more than 5 months in a
calendar year.

 

Section 5. Election to Participate. Each Eligible Employee may become a
Participant on the Entry Date that coincides with or follows the date he first
becomes an Eligible Employee, by complying with this Section.

 

(a) The Eligible Employee shall file with the Committee an Enrollment Form
authorizing specified regular payroll deductions from his Compensation.

 

(b) Regular payroll deductions shall be subject to a minimum deduction of 1% and
a maximum deduction of 20% of Compensation for the payroll period and to a
maximum deduction per payroll period of $1,000.

 

(c) The Company shall hold all payroll deduction amounts as part of its general
assets, but shall credit each Participant’s payroll deduction amounts, without
interest, to a Payroll Deduction Account in his name.

 

(d) To begin participation as of an Entry Date, an Eligible Employee must file
his Enrollment Form with the Committee not less than 14 days before that Entry
Date, unless a shorter period of time

 

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is prescribed by the Committee. An Enrollment Form not filed within the
prescribed filing period shall be effective the second Entry Date following the
filing of the Enrollment Form.

 

(e) A Participant may increase or decrease his payroll deduction, effective as
of the next Entry Date, by filing a new Enrollment Form.

 

(f) At any time during the first 2 ½ months of a calendar quarter, a Participant
may elect to terminate his payroll deductions and receive a refund of the
balance in his Payroll Deduction Account accumulated during that calendar
quarter. In that event, he shall not again become a Participant until the second
Entry Date following his election to terminate.

 

Section 6. Participant Purchases and Investment Accounts. On each Investment
Date, each Participant shall be deemed, without further action, to have
purchased shares of Common Stock with the entire balance in his Payroll
Deduction Account, and the Agent shall credit the purchased shares to the
Participant’s Investment Account.

 

(a) The Participant shall be credited with the number of whole and fractional
shares (rounded to three decimal places) that his Payroll Deduction Account
balance can purchase at the Purchase Price on that Investment Date.

 

(b) All dividends paid with respect to the whole and fractional shares of the
Common Stock and shares so purchased shall be reinvested in Common Stock and
added to the shares held for a Participant in his Investment Account.

 

(c) Expenses incurred in the purchase of shares and the expenses of the Agent
shall be paid by the Company.

 

Section 7. Limitation on Purchases. Participant purchases are subject to the
following limitations:

 

(a) During any one calendar year, a Participant may not purchase, under the Plan
or under any other plan qualified under Code section 423, shares of Common Stock
having a Fair Market Value (determined by reference to the Fair Market Value on
each date of purchase) in excess of $25,000.

 

(b) During any one calendar year, all Participants who are corporate officers of
the Company may not purchase, in the aggregate, more than 50% of the Common
Stock purchased under the Plan during that calendar year.

 

(c) A Participant’s Payroll Deduction Account may not be used to purchase Common
Stock on any Investment Date to the extent that, after such purchase, the
Participant would own (or be considered as owning within the meaning of Code
section 424(d)) stock possessing 5% or more of the total combined voting power
of the Company. For this purpose, stock that the Participant may purchase under
any outstanding option shall be treated as owned by such Participant. As of the
first Investment Date on which this paragraph limits a Participant’s ability to
purchase Common Stock, the Participant’s payroll deductions shall terminate, and
he shall receive a refund of the balance in his Payroll Deduction Account.

 

Section 8. Stock Purchases by Agent. As of each Investment Date, the Agent shall
acquire, using the accumulated balances of all Participants’ Payroll Deduction
Accounts, shares of Common Stock to be credited to those Participants’
Investment Accounts.

 

(a) The Agent shall acquire shares issued or held as treasury shares by the
Company or, if directed by the Committee, by purchases on the open market or in
private transactions.

 

(b) If shares are purchased in one or more transactions on the open market or in
private transactions at the direction of the Committee, the Company will pay the
Agent the difference between the Purchase Price and the price at which such
shares are purchased for Participants.

 

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Section 9. Investment Account Withdrawals. Upon 5 business days advance written
notice to the Agent, a Participant may elect as of any Investment Date to
withdraw the assets in his Investment Account.

 

(a) The Participant may elect to obtain a certificate for the whole shares of
Common Stock credited to his Investment Account. As a condition of participation
in the Plan, each Participant agrees to notify the Company if he sells or
otherwise disposes of any of his shares of Common Stock within two years of the
Entry Date immediately preceding the Investment Date on which such shares were
purchased.

 

(b) The Participant may elect that all shares in his Investment Account be sold
and that the proceeds, less expenses of sale, be remitted to him.

 

(c) In either event, the Agent will sell any fractional shares held in the
Investment Account and remit the proceeds of such sale, less selling expenses,
to the Participant.

 

(d) If a Participant withdraws the assets in his Investment Account, he shall
cease to be a Participant and shall not again become a Participant until the
second Entry Date following the withdrawal.

 

Section 10. Cessation of Participation. If a Participant dies, terminates
employment, or withdraws assets from his Investment Account, he shall cease to
participate in the Plan, the Company shall refund the balance in his Payroll
Deduction Account, and the Agent shall distribute the assets in his Investment
Account.

 

(a) In the event of the Participant’s death, his Payroll Deduction Account
balance and his Investment Account assets shall be distributed to his
Beneficiary.

 

(b) If the Participant terminates employment, his Payroll Deduction Account
balance and his Investment Account assets shall be distributed to him.

 

(c) Upon distribution, the Participant or, in the event of his death, his
Beneficiary may elect to obtain a certificate for the whole shares of Common
Stock credited to the Participant’s Investment Account or may elect that any
whole shares in his Investment Account be sold. In that event, the Agent will
sell such whole shares and any fractional shares held in the Investment Account
and remit the proceeds of such sale, less selling expenses.

 

Section 11. Beneficial Interests in Plan. Each Payroll Deduction Account and
each Investment Account shall be in the name of the Participant. A Participant
may designate a Beneficiary to receive his interests in both accounts in the
event of his death by complying with procedures prescribed by the Committee. If
a Participant dies without having designated a Beneficiary, or if the
Beneficiary does not survive the Participant, the Participant’s estate shall be
his Beneficiary.

 

Section 12. Administration of the Plan. The Plan shall be administered by the
Employee Stock Purchase Plan Committee.

 

(a) The Committee shall consist of not less than three members appointed by the
Board. The Board from time to time may fill vacancies in the Committee.

 

(b) Subject to the express provisions of the Plan, the Committee shall have the
authority to take any and all actions (including directing the Agent as to the
acquisition of shares) necessary to implement the Plan and to interpret the
Plan, to prescribe, amend and rescind rules and regulations relating to it, and
to make all other determinations necessary or advisable in administering the
Plan. All of such determinations shall be final and binding upon all persons.

 

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(c) A quorum of the Committee shall consist of a majority of its members and the
Committee may act by vote of a majority of its members at a meeting at which a
quorum is present, or without a meeting by a written consent to their action
taken signed by all members of the Committee.

 

(d) The Committee may request advice or assistance or employ such other persons
as are necessary for proper administration of the Plan.

 

Section 13. Rights Not Transferable. Rights under the Plan are not transferable
by a Participant.

 

Section 14. Change in Capital Structure. Despite anything in the Plan to the
contrary, the Committee may take the following actions without the consent of
any Participant or Beneficiary, and the Committee’s determination shall be
conclusive and binding on all persons for all purposes.

 

(a) In the event of a stock dividend, stock split or combination of shares,
recapitalization or merger in which the Company is the surviving corporation or
other change in the Company’s capital stock (including, but not limited to, the
creation or issuance to shareholders generally of rights, options or warrants
for the purchase of common stock or preferred stock of the Company), the number
and kind of shares of stock or securities of the Company to be subject to the
Plan, the maximum number of shares or securities which may be delivered under
the Plan, the selling price and other relevant provisions shall be appropriately
adjusted by the Committee, whose determination shall be binding on all persons.

 

(b) If the Company is a party to a consolidation or a merger in which the
Company is not the surviving corporation, a transaction that results in the
acquisition of substantially all of the Company’s outstanding stock by a single
person or entity, or a sale or transfer of substantially all of the Company’s
assets, the Committee may take such actions with respect to the Plan as the
Committee deems appropriate.

 

Section 15. Amendment of the Plan. The Board may at any time, or from time to
time, amend the Plan in any respect. The shareholders of the Company, however,
must approve any amendment that would increase the number of shares of Common
Stock that may be issued under the Plan (other than an increase merely
reflecting a change in capitalization of the Company) or a change in the
designation of any corporations (other than a Subsidiary) whose employees become
Eligible Employees under the Plan.

 

Section 16. Termination of the Plan. The Plan and all rights of employees and
beneficiaries under the Plan shall terminate:

 

(a) on the Investment Date that Participants become entitled to purchase a
number of shares greater than the number of reserved shares remaining available
for purchase; or

 

(b) at any date at the discretion of the Board.

 

In the event that the Plan terminates under circumstances described in (a)
above, reserved shares remaining as of the termination date shall be issued to
Participants on a prorata basis. Upon termination of the Plan, each Participant
shall receive the balance in his Payroll Deduction Account and all shares in his
Investment Account.

 

Section 17. Indemnification of Committee. Members of the Committee shall be
entitled to indemnification and reimbursement to the same extent applicable to
directors of the Company pursuant to its Articles of Incorporation and Bylaws.

 

Section 18. Government Regulations. The Plan, the grant and exercise of the
rights to purchase shares under the Plan, and the Company’s obligation to sell
and deliver shares upon the exercise of rights to purchase shares, shall be
subject to all applicable federal, state and foreign laws, rules and
regulations, and to such approvals by any regulatory or government agency as
may, in the opinion of counsel for the Company, be required.

 

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Interactive Intelligence, Inc. has caused this Interactive Intelligence, Inc.
Employee Stock Purchase Plan to be adopted as of April 1, 2000.

 

Amendment approved by the Board of Directors of Interactive Intelligence, Inc.
as of April 1, 2005

 

Amendment approved by the Shareholders of Interactive Intelligence, Inc. as of
May 19, 2005

 

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