**Exhibit 10.10**

 

**SPESCOM SOFTWARE**

 
|   |                                 |
|--------|---------------------------------|
|   |                            |
|   | 10052 Mesa Ridge Ct., Suite 100 |
|   | San Diego, CA 92121-2616        |
|   | Tel: 858.625.3000               |
|   | Fax: 858.625.3010               |
|   | www.spescomsoftware.com         |

 

April 19, 2006

 

Glenn H. Cox II

478 Saybrook Rd.

Haddam, Ct. 06438

 

Dear Glenn:

 

In order to provide you with an incentive to exert your maximum effortsto complete a change of control (“Change in Control”) in the ownership ofSpescom Software Inc. (the “Company”) that will be beneficial to theshareholders of the Company, and in order to retain your services through andafter the time that a Change in Control has occurred, the Company agrees tooffer you a retention bonus (“Retention Bonus”) and severance benefits subjectto the terms contained in this letter agreement (“Agreement”).

 

1.             If at the time of aCIC your employment with the Company has not been terminated voluntarily by youor based on Cause by the Company, then a Retention Bonus will be an amountallocated to you out of a pool equal to seven percent (7%) of the NetAcquisition Proceeds of any Change in Control of the Company and will bepayable in cash or securities of the acquiring entity (the “Acquiror”), or acombination thereof, subject to Sections below; provided, however, that the minimum amount of the Retention Bonus pool shallbe $450,000 and the maximum amount of the Retention Bonus pool will be$675,000, regardless of Net Acquisition Proceeds.

 

2.             At least 50% of theRetention Bonus you receive (if any) will be paid in the form of cash. You willhave the right to demand that all or some portion of any cash component of theRetention Bonus be paid in the form of securities of the Acquiror to the extentthat the Net Acquisition Proceeds consists of securities of the Acquiror.

 

3.             Any securities ofthe Acquiror that you receive as part of the Retention Bonus may be subject tosuch terms and conditions, including restrictions on the transferability ofsuch securities for a period of up to one (1) year, as the Company maydetermine.

 

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4.             The Chief ExecutiveOfficer of the Company shall make recommendations to the Compensation Committeeof the Board regarding the allocation of the Retention Bonus pool described inSection 1, provided that the final allocation and payment of the RetentionBonus is subject to such committee’s approval and ratification. Payment of anyRetention Bonus hereunder shall be made simultaneous with the Closing.

 

5.             In the event thatyou are not employed by the Company or the Acquiror after the Change inControl, the Company agrees to redeem, or to cause the redemption of, for cash,any non-marketable securities of the Acquiror that were paid as part of theRetention Bonus within twelve (12) months after the Closing (the specifictiming of such redemption to be determined by the Company, in its sole discretion).Such redemption shall be at a price equal to the fair market value of thesecurities redeemed at the time of redemption, as reasonably determined by theAcquiror.

 

6.             In addition to theRetention Bonus, you will be entitled to (i) severance benefits equal to six(6) months of your Base Salary, paid in installments based on the Company’sstandard payroll procedures and (ii) payment by the Company of your COBRApremiums (less the Company’s standard employee insurance contributions) underthe Company’s health plan (or a comparable health plan of the Acquiror) for aperiod of six (6) months after the Closing, in any one of the followingcircumstances:

 
| (a)    |   | You are not offered employment at the  Company or with the Acquiror after the Change in Control;                                                                                                                                                |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                            |
| (b)    |   | You are not offered employment at the  Company or with the Acquiror after the Change in Control in a position with  duties and responsibilities that are comparable to those of your current  position and you decline the offered position ;or |
|   |   |                                                                                                                                                                                                                                            |
| (c)    |   | Relocation that increases your commute by  more than twenty five (25) miles is required to ensure continued employment  following a Change in Control and you decline to relocate thus terminating  your employment                             |

 

7.             In the event thatyou accept employment with the Company or with the Acquiror after the Change inControl and are terminated without Cause within twelve (12) months followingthe Closing, you will be entitled to (i) severance benefits equal to six (6)months of your Base Salary, paid in installments based on the Company’sstandard payroll procedures and (ii) payment by the Company of your COBRApremiums (less the Company’s standard employee insurance contributions) underthe Company’s health plan (or a comparable health plan of the Acquiror) for aperiod of six (6) months after the date of termination.

 

8.             Notwithstandinganything contained herein to the contrary, your entitlement to the severancebenefits described in Sections 6 and 7 is conditioned upon your execution of aneffective release of claims (“Release”) and separation agreement (“SeparationAgreement”) containing such restrictive covenants (including, withoutlimitation, non-competition, non-solicitation and non-disclosure covenants) asthe Company lawfully may impose.

 

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9.             The following definitionsapply for purposes of this Agreement:

 
| (a)    | ** ** | **“Base Salary”**  means your base salary in effect immediately prior to the Closing.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|--------|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| (b)    | ** ** | **“Board”** means the  Board of Directors of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| (c)    | ** ** | **“Cause”** means (A)  a material breach by you of any of the terms of the Release or Separation  Agreement; (B) any act of misappropriation, embezzlement, fraud or similar  conduct involving the Company; (C) the conviction or the plea of nolo  contendere or the equivalent in respect of a felony involving moral  turpitude; (D) intentional infliction of any damage of a material nature  to any property of the Company; or (E) any intentional act by you that  has a material detrimental effect on the reputation or business of the  Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| (d)    | ** ** | **“Change in Control”**  means a transaction or related series of transactions involving the sale or  exchange of more than fifty percent (50%) of the stock or assets of the  Company so that the management and operation of the Company is controlled by  one shareholder or group of shareholders which is different than those  shareholders controlling the management and operation of the Company prior to  the Change of Control.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|   |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| (e)    | ** ** | **“Closing”** means  the closing of a transaction constituting a Change in Control.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|   |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| (f)    | ** ** | **“Net Acquisition Proceeds”**  means the sum of all cash and/or the market value of any securities received  by the Company upon a Change in Control, reduced (1) by the selling and  other transactional expenses incurred as a result of the Change in Control  and (2) by the liabilities of the Company, if any, retained by the  Company’s selling shareholders (not including any liabilities created as a  result of this Agreement) provided, however, that the deferred dividend and  related interest payable to Spescom Ltd. on its Series F Preferred Stock and any payables owed to Spescom  Ltd.excluding the 10% promissory notes and related accrued interest shall  not be deemed to be a liability of the Company retained by the Company’s  selling shareholders. Proceeds received with respect to** **any  contingent payments in any transaction constituting a Change in Control, less  any related expenses and liabilities as discussed above, shall be included in  the determination of Net Acquisition Proceeds and additional payments under  the Agreement shall be distributed as such contingent payments are received. |

 

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10.           The determination ofwhether a Change in Control has occurred, the determination of Net AcquisitionProceeds, the calculation of the Retention Bonus, and the determination of theform in which the Retention Bonus is payable shall be made by the Board subjectto the terms of this Agreement.

 

11.           The amounts payablepursuant to this Agreement are not intended to have an impact on any othercompensatory arrangements or employee benefit plans under which you may beentitled to benefits.

 

12.           The Company shallnot be obligated to make any payment pursuant to this Agreement unless anduntil any tax withholding requirement is satisfied.

 

13.           All questionsregarding the construction, validation and interpretation of this Agreementwill be governed by the law of the State of California.

 

 

Please indicate your consent and agreement to the foregoing by signingwhere indicated below.

 

Sincerely,

 

 

Spescom Software Inc.

 

 
|   | By:    |  /s/ Keith Stentiford |   |
|--------|--------|----------------------------|--------|
|   |   |
|   | Name:  |  Keith Stentiford     |   |
|   |   |
|   | Title: | Chief Executive Officer    |   |
|        |        |                            |        |  |  |

 

AGREED AND ACCEPTED

 

this 25th day of April , 2006

 
| By:    |   /s/ Glenn H. Cox II                     |   |
|--------|-----------------------------------------------------|--------|
|   |       Glenn H. Cox II |

 

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