**Exhibit10.9**

** **

**EMPLOYMENTAGREEMENT**

 

 

**           THISEMPLOYMENT AGREEMENT** (“Agreement”), made and enteredinto, effective as of the 11th day of August, 2003, by and between DonnaLeGrand (“Employee”) and Interactive Intelligence, Inc. (“Company”), an Indianacorporation.

 

**WITNESSETH:**

 

**           WHEREAS**, the Employee possesses certain skillswhich the Company wishes to utilize in its business, and the Employee wishes toprovide certain services to the Company upon the terms and conditions set forthin this Agreement;

 

           **NOW, THEREFORE**, in consideration of thepremises and of the mutual promises and agreements contained herein and othergood and valuable consideration, the receipt, legal adequacy and sufficiency ofwhich are hereby acknowledged, the parties agree as follows:

 

           **Section 1. Employment.**  TheCompany engages the Employee to serve the Company, and the Employee agrees toserve the Company as an employee in such capacities as the Board of Directorsof the Company may, from time to time, determine, upon the terms and conditionshereinafter set forth.

 

           **Section 2. Term; Renewal.**  Theterm of the Employee’s employment under this Agreement shall be for an initialterm commencing and ending on the dates set forth on the Addendum attachedhereto and incorporated herein by reference (“Addendum”), which term shallautomatically renew for successive one (1) year terms, on the same terms andconditions set forth herein unless either the Company or the Employee giveswritten notice to the other, at least thirty (30) days prior to the expirationof the initial term or any renewal term, that the term will not renew.

 

**           Section3.  Title, Services and Duties.**

           (a)  During theterm of employment hereunder, the Employee shall serve in the capacitiesdescribed on the Addendum and shall perform the duties and responsibilitiesdescribed on the Addendum or as are normally associated with such a position inthe Company’s industry and as may be delegated to the Employee by the Presidentor the Company’s Board of Directors.

 

           (b) During such employment, the Employee shall devote substantially all ofthe Employee’s  business time,attention, energy and skill to the business of the Company, and shall performsuch services in a faithful, competent and diligent manner at the direction ofthe President and of the Company’s Board of Directors.

 

           (c) During the Employee’s employment, the Company shall provide the Employeewith such office facilities and support services as the Company determines inits business judgment to be appropriate for the Employee to perform theEmployee’s duties and responsibilities hereunder.

 

 

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           (d)  The Employeeshall comply with all policies and procedures adopted by the Company from timeto time, including without limitation, policies regarding reimbursement forbusiness expenses incurred on behalf of the Company, and compliance withapplicable laws.

 

**           Section4.  Compensation as Employee.  **At all times during the initial term or any renewalterm of this Agreement, the Company shall pay the Employee an annual salary inthe amount set forth in the Addendum, payable at the usual payroll paymentdates of the Company, and any other options or benefits set forth in theAddendum.  All amounts paid hereunder byCompany to the Employee shall be subject to all applicable local, state andfederal withholding taxes.  The Companymay increase or decrease the salary set forth herein from time to time, in itssole discretion, but any decrease may only be made upon fifteen (15) days priornotice.

 

           **Section 5. Termination and Severance Payments**

           (a) In the event that the employment of the Employee is terminated for causeor in the event that the Employee resigns his/her employment with the Company,the Employee shall be paid any salary and any other benefits which have thenaccrued and to which the Employee is entitled to at such time.  However, in such event, the Employee shallnot be entitled to any severance compensation as set forth in subparagraph (b)below.

 

           (b) In the event that the employmentof the Employee is terminated by the Company for any reason other than forcause, in addition to receiving all accrued salary and benefits to which theEmployee is entitled to at such time, the Company further agrees to pay theEmployee as severance pay an amount equal to the Employee’s salary as in effectat such time for an additional three (3) months from the date of termination,with payments to be made on the Company’s usual payroll payment dates.

 

           (c) All amounts paid under Subsections (a) or (b) hereof  to the Employee shall be subject to allapplicable local, state or federal withholding taxes, if any.

 

           **Section 6. Employee Benefits**.

           (a) The Employee shall be limited each calendar year to a vacation benefitfor the amount of time shown in the Addendum (prorated from the date of commencementto the end of that applicable calendar year). All vacation benefits must be fully utilized in the calendar year inwhich accrued, provided that (i) no vacation may be taken during the first six(6) months of the initial term hereof without the prior written consent of theCompany, (ii) the Employee must comply with procedures adopted from time totime by the Company with respect to the scheduling of vacations, and (iii) ifbecause of the Company’s requirements, the Company does not approve the Employee’srequested vacation schedule and thus prevents the Employee from fully utilizingall of the Employee’s vacation in the year earned, the Company and the Employeeshall in good faith make arrangements for either the carryover of such unusedvacation to the next calendar year or such other arrangements as are mutuallysatisfactory.

 

           (b) During the term of the Employee’s employment hereunder, the Employeeshall be entitled to participate, upon the same terms and conditions applicableto employees generally in any life, health, hospitalization or any otherinsurance program, or any other pension or benefit 

 

 

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plan which theCompany may from time to time provide or make available to the Company’s employeesand for which the Employee is eligible and qualified; provided that if theinclusion of the Employee under any such program or plan causes or would causeeither such program or plan to be terminated or the Company to incur amaterially disproportionate additional cost, the Company may elect to providebenefits of a substantially similar nature which avoids such adverse effects.

 

**           Section7.**  **Covenant Not to Compete.**

           (a) During the Employee’s service hereunder and for a period of eighteen(18) months thereafter, regardless of the reason or method of termination, theEmployee will not, directly or indirectly, for the Employee’s own benefit orthe benefit of any other person or entity:

 

(i)            solicit in any manner, seek toobtain, or service the business of any customer of the Company, other than forthe Company;

(ii)           become an owner of any business, ifsuch business competes with the Company;

(iii)          become employed by or serve as anagent, independent contractor or representative of any business which competeswith the Company;

(iv)          solicit the employment of or hire anyemployee of the Company, or encourage any employee to terminate his or heremployment with the Company; or

(v)           prepare in any manner to compete withthe Company.

 

           (b)  For purposesof this Agreement, a “customer” shall be deemed to be any person, business,partnership, proprietorship, firm, organization or corporation which has donebusiness with the Company or which has been solicited or serviced in anymanner, directly or indirectly, by the Company within eighteen (18) monthsprior to the date of the termination of the Employee, and the phrase “servicethe business of any customer” means the development, modification, enhancementor improvement of any product or service offered by the Company or which isreasonably related to the products or services offered by the Company.  The Employee hereby acknowledges that, byvirtue of the Employee’s position and access to information, the Employee willhave advantageous familiarity and personal contacts with the Company’scustomers, wherever located, and that the restrictions contemplated hereby arereasonable for the protection of the Company’s goodwill and customer base, andthe Company’s efforts in the development of such customers.

 

           (c) If the Employee does not comply with the provisions of this Section 7,the eighteen (18) month period of non-competition provided herein shall betolled and deemed not to run during any period(s) of noncompliance, theintention of the parties being to provide eighteen (18)  full months of non-competition by theEmployee after the termination or expiration of this Agreement.

 

**           Section8.  Covenant Not to DiscloseConfidential Information.**

           (a) The term “Confidential Information” as used herein shall mean any and allsoftware programs, customer lists, trade secrets and information, know-how,skills, knowledge, ideas, knowledge of customer’s commercial requirements,pricing methods, sales and marketing techniques, dealer relationships andagreements, financial information, intellectual property, 

 

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codes, algorithms,research, development, research and development programs, processes,documentation, inventions, or devices used in or pertaining to the Company’sbusiness (i) which relate in any way to the Company’s business, products orprocesses; or (ii) which are discovered, conceived, developed or reduced topractice by the Employee, either alone or with others either (x) during theterm of this Agreement; or (y) at the Company’s expense; or (z) on theCompany’s premises or with the Company’s equipment.

 

           (b) During the course of his/her services hereunder, the Employee may becomeknowledgeable about, or become in possession of, Confidential Information.  If such Confidential Information were to bedivulged or become known to any competitor of the Company or to any otherperson outside the employ of the Company, or if the Employee were to consent tobe employed by any competitor of the Company or to engage in competition withthe Company, the Company would be harmed. In addition, the Employee has or may develop relationships with theCompany’s customers which could be used to solicit the business of suchcustomers away from the Company.  Theparties have entered into this Agreement to guard against such potential harm.

 

           (c) The Employee shall not, directly or indirectly, use any ConfidentialInformation for any purpose other than the benefit of the Company orcommunicate, deliver, exhibit or provide any Confidential Information to anyperson, firm, partnership, corporation, organization or entity, except otheremployees or agents of the Company as required in the normal course of  the Employee’s service as an employee orexcept as the President or any authorized officer of the Company may direct inwriting.  The covenant contained in thisSection 8 shall be binding upon the Employee during the term of this Agreementand following the termination hereof, for the shorter of the period untileither (i) until such Confidential Information becomes obsolete; or  (ii) until such Confidential Informationbecomes generally known in the Company’s trade or industry by means other thana breach of this covenant.

 

           (d) The Employee agrees that all Confidential Information and all records,documents and materials relating to all of such Confidential Information, shallbe and remain the sole and exclusive property of the Company.

 

**Section 9.****  Remedies.**

           (a) The Employee agrees that the Company will suffer irreparable damage andinjury and will not have an adequate remedy at law in the event of any breachby the Employee of any provision of Sections 7 or 8 hereof.  Accordingly, in the event of a breach or ofa threatened or attempted breach by the Employee of Sections 7 or 8 hereof, inaddition to all other remedies to which the Company is entitled under law, inequity, or otherwise, the Company shall be entitled to a temporary restrainingorder and permanent injunction (without the necessity of showing any actualdamage) or a decree of specific performance of the provisions of Sections 7 or8 hereof and no bond or other security shall be required in thatconnection.  The Company shall beentitled to recover from the Employee, reasonable attorneys’ fees and expensesincurred in any action wherein the Company successfully enforces the provisionsof Sections 7 or 8 hereof against the breach or threatened breach of thoseprovisions by the Employee.

 

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           (b)        TheEmployee acknowledges and agrees that in the event of termination of thisAgreement for any reason whatsoever, the Employee can obtain other engagementsor employment of a kind and nature similar to that contemplated herein and thatthe issuance of an injunction to enforce the provisions of Sections 7 or 8hereof will not prevent the Employee from earning a livelihood.

 

           (c)         Thecovenants on the part of the Employee contained in Sections 7 or 8 hereof areessential terms and conditions to the Company entering into this Agreement, andshall be construed as independent of any other provision in thisAgreement.  The existence of any claimor cause of action the Employee has against the Company, whether predicated onthis Agreement or otherwise, shall not constitute a defense to the enforcement bythe Company of these covenants.

 

           **Section 10.  Inventions.**

           (a) The Employee shall disclose fully to the Company allinventions (as defined below) conceived or discovered by the Employee, whethersolely or jointly with others during the term of this Agreement.  Such inventions shall belong solely to theCompany and shall not belong to the Employee. During the term of this Agreement, the Employee shall assign to theCompany, exclusively and free from any royalty obligation or any other legal orequitable title or right of the Employee, all such inventions referred to aboveand all patents, trademarks, copyrights, and maskworks, and any and allapplications and rights pertaining thereto on a worldwide basis.  The Employee shall assist the Company,during and subsequent to the term hereof, in every proper way, but without anyfurther compensation or additional consideration, to transfer and assign suchinventions to and for the Company’s benefit and enjoyment and to cooperate asmay be reasonably requested to perfect the Company’s ownership therein and, ifrequested by the Company, to prosecute or direct in prosecuting any applicationfor or registration with respect to any patent or other applicable intellectualproperty right, including, but not in limitation thereof, the execution anddelivery of applications for the registration of one or more intellectualproperty rights and assignments of the same as may be deemed necessary ordesirable by the Company in any office selected by the Company.  The judgment of the Company with respect tothe registrability of any particular item of intellectual property shall befinal and conclusive as between the Employee and the Company.

 

           (b) Any improvements made upon such inventions by the Employee subsequent tothe term hereof shall be presumed to have been developed during the term hereofand by and for the benefit of the Company and accordingly shall be the propertyof the Company.

 

           (c) The Employee agrees to execute such other standard forms relating to theinvention or development of inventions and other intellectual properties as theCompany may require of its consultants and employees generally.

           (d) Prior inventions of the Employee, if any, as listed on the Addendum, areexcluded from the scope of this Agreement.

 

           (e) For purposes of this Agreement,“inventions” includes all inventions, creations, developments, softwareprograms, algorithms, routines, patterns, components, compilations, 

 

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devices, orimprovements of any kind or nature, whether or not trade secret, patented,patentable, copyrighted or copyrightable, which the Employee had made orconceived or developed or may make, conceive or develop, either solely orjointly with others, while in the employ of the Company or with the use of theCompany’s time, materials, equipment or facilities or relating in any way tothe  Company’s actual, anticipated, orsubsequently arising business, products, services or activities, or arising outof or suggested by any task assigned to be performed by the Employee, solely orjointly with others, for or on behalf of the Company.

 

           **Section 11.  Surrender of Records.** Upon termination of the Employee’s employment for any reason, theEmployee shall immediately surrender to the Company any and all records, notes,documents, forms, manuals, photographs, instructions, lists, drawings,blueprints, programs, diagrams or other written, printed or electronic material(including any and all copies made at any time whatsoever) in his or herpossession or control which pertain to the business of the Company.

 

           **Section 12.  Termination.**  During the initial term or any renewal term, the employment of theEmployee may be terminated at will for any reason by either the Company or theEmployee, with at least ten (10) days prior written notice by the terminatingparty delivered to the other setting forth whether such termination was forcause or without cause to determine whether the Employee is entitled to anyseverance payment pursuant to Section 5 above. Notwithstanding the foregoing, this Agreement shall be terminatedimmediately, without any notice or waiting period, upon the Employee’sdeath.  This Agreement may be terminatedat any time by mutual agreement of the parties.

 

           **Section 13.  Parties Bound.** All provisions of this Agreement shall inure to the benefit of and bebinding upon the parties hereto, their heirs, personal representatives,successors and assigns.

 

           **Section 14.  Effect and Modification.**  This Agreement comprises the entire agreement between the partieswith respect to the subject matter hereof and supersedes all other earlieragreements relating to the subject matter hereof.  No statement or promise, except as herein set forth, has beenmade with respect to the subject matter of this Agreement.  No modification or amendment hereof shall beeffective unless in writing and signed by the Employee and an officer of theCompany (other than the Employee).

 

           **Section 15.  Non-Waiver.** The Company’s or the Employee’s failure or refusal to enforce all or anypart of, or the Company’s or the Employee’s waiver of any breach of thisAgreement, shall not be a waiver of the Company’s or the Employee’s continuingor subsequent rights under this Agreement, nor shall such failure or refusal orwaiver have any affect on the subsequent enforceability of this Agreement.

 

           **Section 16.  Non-Assignability.** This Agreement contemplates that the Employee will personally providethe services described herein, and accordingly, the Employee may not assign theEmployee’s rights or obligations hereunder, whether by operation of law orotherwise, in whole or in part, without the prior written consent of theCompany.

 

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           **Section 17.  Notice.**  Anynotice, request, instruction or other document to be given hereunder to anyparty shall be in writing and delivered by hand, telegram, registered orcertified United States mail return receipt requested, or other form ofreceipted delivery, with all expenses of delivery prepaid, as follows:

 
|            If to the Employee: |   | To the most recent  address the Company has on its records.  Employees most recent address (please fill in): |
|----------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------|
|                                                                             |   | 11428 Peed Road                                                                                              |
|                                                                             |   | Raleigh, NC 27614                                                                                            |
|                                                                             |   |                                                                                                         |
|            If to the Company:  |   | Interactive  Intelligence, Inc.                                                                              |
|                                                                             |   | 7601 Interactive Way                                                                                         |
|                                                                             |   | Indianapolis, IN 46278                                                                                       |
|                                                                             |   | Attn:  Donald E. Brown, M.D., President                                                                 |

 

Any notice to theemployee shall also be sufficient, if sent to the most recent address of theemployee on the Company’s books and records.

 

           **Section 18.  Governing Law.** This Agreement is being delivered in and shall be governed by the lawsof the State of Indiana.  All actions orproceedings shall be tried in the state or federal courts whose venue includesMarion County or Hamilton County, Indiana.

 

           **Section 19.  Prior Agreements.**

           (a) The Employee represents and warrants to the Company that the Employee isnot a party to or otherwise bound by any agreement that would restrict in anyway the performance by the Employee of the Employee’s duties, services andobligations under this Agreement, that the Employee has disclosed to theCompany all employment type agreements to which the Employee has been bound,including without limitation employment agreements, consulting agreements,non-compete agreements or covenants, confidentiality or non-disclosureagreements or covenants, and intellectual property assignment agreements, andthat the Company will not have any liability to any third party arising out ofthe Employee entering into this Agreement or performing hereunder.

 

           **IN WITNESS WHEREOF**, the parties hereto havecaused this Agreement to be executed as of the day and year first abovewritten.

 
|   |   |   | /s/ Donna LeGrand      |   |
|--------|--------|--------|------------------------|--------|
|   |   |   | Printed: Donna LeGrand |

 

 

                                                                                           **INTERACTIVEINTELLIGENCE, INC.**

 
|   |   |   |   |   |   |   | By: /s/ Keith Midkiff |                                    |
|--------|--------|--------|--------|--------|--------|--------|-----------------------|-----------------------------------------|
|   |   |   |   |   |   |   |                  | Keith Midkiff, Chief  Financial Officer |
|        |        |        |        |        |        |        |                       |                                         |  |

 

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**ADDENDUM TO EMPLOYMENT AGREEMENT**

**BETWEEN INTERACTIVE INTELLIGENCE,INC.**

**AND**

**DONNA LEGRAND, DATED, AUGUST 11, 2003**

 

 

This Addendumrelates to the Employment Agreement between Interactive Intelligence, Inc. and,Donna LeGrand dated August 11, 2003. This Addendum is incorporated therein by reference and shall be anintegral part of the Employment Agreement.

 

 
| 1.  Name of Employee:                                                                                       | Donna LeGrand                                                                               |
|------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------|
|                                                                                                             |                                                                                        |
| 2.  Initial Term:                                                                                           | Two (2) Years                                                                               |
|                                                                                                             |                                                                                        |
| 3.  Date of Commencement:                                                                                   | August 11, 2003                                                                             |
|                                                                                                             |                                                                                        |
| 4.  Date Initial Term Ends:                                                                                 | August 11, 2005                                                                             |
|                                                                                                             |                                                                                        |
| 5.  Title:                                                                                                  | General Corporate  Counsel                                                                  |
|                                                                                                             |                                                                                        |
| 6.  Job Description:                                                                                        | Administration                                                                              |
|                                                                                                             |                                                                                        |
| 7.  Initial Compensation:                                                                                   | $150,000                                                                                    |
|                                                                                                             |                                                                                        |
| 8.  Stock Options:                                                                                          |                                                                                        |
|                 – Plan           | Incentive Stock  Option Plan (“Qualified”)                                        |
|                 – Number         | #15,000 (fifteen  thousand) shares                                                          |
|                 – Exercise Price | Price in effect  as of the grant date                                                       |
|                                                                                                             |                                                                                        |
| 9.  Amount of Vacation:                                                                                     | Three (3) weeks per  calendar year                                                          |
|                                                                                                             |                                                                                        |
| 10.  Other Benefits:                                                                                        | Medical, Vision and  Dental Insurance, 401k Plan,  Long Term Disability, Cafeteria 125 Plan |
|                                                                                                             |                                                                                        |
| 11.  Prior Inventions:                                                                                      |                                                                                        |
|                                                                                                             |                                                                                        |
| Date: August 11, 2003                                                                                            | /s/ KAM                                                                                     |   | /s/ DGL |
|                                                                                                             | Initials                                                                                    |   | Initials |
|                                                                                                             |                                                                                        |
| (#31613 and  40525)

 

RAG/bac/SS-49204-1                                                                  |                                                                                        |

 

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