Document:

exv10w61

 

Exhibit 10.61

EMPLOYMENT AGREEMENT

EFFECTIVE AS OF JANUARY 1, 2006

BETWEEN

VODAVI TECHNOLOGY, INC.

AND

GREGORY K. ROEPER

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	1.	 	Employment
	 	 	1	 
	2.	 	Full Time Occupation
	 	 	1	 
	3.	 	Compensation and other Benefits
	 	 	1	 
	 	 	(a) Salary
	 	 	1	 
	 	 	(b) Bonus
	 	 	1	 
	 	 	(c) Reimbursement
	 	 	1	 
	 	 	(d) Fringe Benefits
	 	 	1	 
	4.	 	Term of Employment
	 	 	2	 
	 	 	(a) Employment Term
	 	 	2	 
	 	 	(b) Termination Under Certain Circumstances
	 	 	2	 
	 	 	(c) Result of Termination
	 	 	3	 
	 	 	(d) Result of Change of Control
	 	 	3	 
	5.	 	Competition and Confidential Information
	 	 	4	 
	 	 	(a) Interests to be Protected
	 	 	4	 
	 	 	(b) Non-Competition
	 	 	4	 
	 	 	(c) Non-Solicitation of Employees
	 	 	5	 
	 	 	(d) Confidential Information
	 	 	5	 
	 	 	(e) Return of Books and Papers
	 	 	5	 
	 	 	(f) Disclosure of Information
	 	 	5	 
	 	 	(g) Assignment
	 	 	6	 
	 	 	(h) Equitable Relief
	 	 	6	 
	 	 	(i) Restrictions Separable
	 	 	6	 
	 	 	(j) Survival
	 	 	6	 
	6.	 	Miscellaneous
	 	 	6	 
	 	 	(a) Notices
	 	 	6	 
	 	 	(b) Indulgences; Waivers
	 	 	7	 
	 	 	(c) Controlling Law
	 	 	7	 
	 	 	(d) Binding Nature of Agreement; Successors and Assigns
	 	 	7	 
	 	 	(e) Execution in Counterparts
	 	 	8	 
	 	 	(f) Provisions Separable
	 	 	8	 
	 	 	(g) Entire Agreement
	 	 	8	 
	 	 	(h) Paragraph Headings
	 	 	8	 
	 	 	(i) Number of Days
	 	 	8	 

 

 

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (“Agreement”) is made as of January 31, 2006, to be effective as of
January 1, 2006 (the “Effective Date”) by and between VODAVI TECHNOLOGY, INC., a Delaware
corporation (“Employer”) and GREGORY K. ROEPER (“Employee”).

RECITALS

     Employer desires to employ Employee and Employee desires to accept such employment, all on the
terms and conditions hereinafter set forth.

AGREEMENT

     NOW, THEREFORE, in consideration of the premises and of the mutual covenants set forth in this
Agreement, the parties hereto agree as follows:

     1. Employment. Employer hereby employs Employee, and Employee hereby accepts such employment,
as President and Chief Executive Officer of Employer and in such other executive capacities and for
such other executive duties and services as shall from time to time be mutually agreed upon by
Employer and Employee.

     2. Full Time Occupation. Employee shall devote Employee’s entire business time, attention,
and efforts to the performance of Employee’s duties under this Agreement, and shall serve Employer
faithfully and diligently and shall not engage in any other employment while employed by Employer.

     3. Compensation and other Benefits.

          (a) Salary. Employer shall pay to Employee, as compensation for the services rendered by
Employee during Employee’s employment under this Agreement, a base salary at a rate of (1) $220,000
per annum (the “Base Salary”). Employer shall pay the Base Salary in accordance with Employer’s
established payroll procedures.

          (b) Bonus. In addition to the Base Salary, Employee shall be eligible to receive annual bonus
compensation (the “Bonus”) in an amount to be set by the Compensation Committee of Employer’s Board
of Directors, at the committee’s sole and exclusive discretion.

          (c) Reimbursement. Employer shall reimburse Employee for all travel and entertainment
expenses and other ordinary and necessary business expenses incurred by Employee in
connection with the business of Employer and Employee’s duties under this Agreement. The term
“business expenses” shall not include any item not at least partially deductible by Employer for
federal income tax purposes. Reimbursements shall be made by Employer in accordance with
Employer’s normal expense policies and procedures.

          (d) Fringe Benefits. Employee shall be entitled to participate in any group insurance,
pension, retirement, vacation, expense reimbursement, and other plans, programs, and benefits
approved by the Board of Directors and made available from time to time

 

 

to executive employees of
Employer generally during the term of Employee’s employment hereunder. The foregoing shall not
obligate Employer to adopt or maintain any particular plan, program, or benefit.

     4. Term of Employment.

          (a) Employment Term. The term of Employee’s employment hereunder shall commence on the
Effective Date and shall continue until December 31, 2006. The term of Employee’s employment
hereunder shall automatically renew for successive one-year terms, unless and until terminated by
either party giving written notice to the other not less than 30 days prior to the end of the
then-current term or as otherwise set forth in Section 4(b).

          (b) Termination Under Certain Circumstances. Notwithstanding anything to the contrary herein
contained:

               (i) Death. Employee’s employment and this Agreement shall be automatically terminated,
without notice, effective upon the date of Employee’s death.

               (ii) Disability. If Employee shall fail to perform any of Employee’s essential job duties
under this Agreement as the result of illness or other incapacity, with or without reasonable
accommodation, for a period of more than 12 consecutive weeks, or for more than 12 weeks within any
12-month period, as determined by Employer for purposes of compliance with the Family and Medical
Leave Act, Employer may, at its option, and upon notice to Employee, terminate Employee’s
employment and this Agreement effective on the date of that notice.

               (iii) Unilateral Decision of Employer. Employer may, at its option, upon notice to Employee,
terminate Employee’s employment and this Agreement effective on the date of that notice. A
reduction in Employee’s responsibilities, as such responsibilities are described in Section
1 of this Agreement, by Employer shall constitute a termination under this Section
4(b)(iii). Employer’s failure to
renew this Agreement upon expiration of the term shall constitute a termination under this
Section 4(b)(iii).

               (iv) Unilateral Decision by Employee. Employee may, at his option and upon notice to
Employer, terminate Employee’s employment and this Agreement effective on the date of that notice.

               (v) Termination
“For Cause”. Employer may terminate Employee’s employment and this Agreement,
and the rights and obligations of the parties hereunder at any time, effective upon written notice
to Employee, if the termination of Employee’s employment is “for cause.” For purposes of this
Section 4(b)(v), “for cause” shall mean discharge resulting from a determination by
Employer that Employee: (A) has been convicted of a felony involving dishonesty, fraud, theft, or
embezzlement; (B) has performed an act or failed to act, which if he were prosecuted and convicted,
would constitute a crime or offense involving money or property of Employer, or which would
constitute a felony in any jurisdiction involved; (C) has violated Employer’s policies prohibiting
sexual harassment or discrimination or harassment or discrimination of any other protected basis
under federal, state, or local law; or (D) has willfully and persistently breached or violated any
of the provisions of

2

 

this Agreement, and such breach or violation shall have continued for a period
of 10 days after Employer shall have given Employee written notice specifying the nature thereof in
reasonable detail.

               (vi) Change of Control. In the event of a Change of Control (as defined below), Employer or
Employee may, at their respective option, upon notice to the other, terminate Employee’s employment
by providing the other party with 30 days’ written notice after the effective date of the Change of
Control. For the purposes of this Agreement, the term “Change of Control” shall mean:

                    (1) The approval by a majority of Employer’s Board of Directors of (A) any merger or
consolidation in which Employer is not the surviving entity; (B) any reverse merger in which the
Company is the surviving entity; or (C) any transaction involving the sale of all or substantially
all of Employer’s assets to any person other than a wholly or majority owned direct or indirect
subsidiary of Employer; or

                    (2) Individuals who, as of the Effective Date, constitute the Board of Directors of the
Company (the “Incumbent Board”) cease for any reason to constitute at least a majority of the
Board, provided that any person becoming a director subsequent to the Effective Date whose
election, or nomination for election by the Company’s stockholders, was approved by a vote of at
least a majority of the directors then comprising the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office is in connection with an actual or
threatened election contest relating to the election of the directors of the Company) shall be, for
purposes of this Agreement, considered as though such person were a member of the Incumbent Board.

          (c) Result of Termination. In the event of the termination of Employee’s employment pursuant
to Sections 4(b)(i), (iv), or (v) above, Employee shall receive no further
compensation under this Agreement and all of Employee’s unvested options shall be cancelled. In
the event of the termination of Employee’s employment pursuant to Section 4(b)(ii) or
(iii) above,

               (i) Employee shall receive his Base Salary plus benefits for a one-year period following the
date of termination of Employee’s employment pursuant to this Agreement. Such Base Salary payments
will be payable in one lump-sum amount within 10 days of the event of termination. Should Employee
become eligible for benefits in connection with a new employer during the one-year period,
Employers obligation for benefits shall cease;

               (ii) Employee’s vested options as of the date of termination shall remain outstanding through
the 120-day period following the then-current term of this Agreement. All of Employee’s unvested
options as of the date of termination shall be cancelled; and

               (iii) Employer shall forgive any balance owed by Employee pursuant to Employer’s funding of
Employee’s Group Life Insurance policy.

          (d) Result of Change of Control. As incentive for Employee to actively pursue the best
interests of Employer’s stockholders, in the event of a Change of Control

3

 

(as that term is defined
in Section 4(b)(vi) of this Agreement), then (i) Employee shall earn the Change in Control
Bonus the , which shall be paid in one lump sum payment within ten business days from the effective
date of the Change of Control in the event of a Change of Control; and (ii) any options held by
Employee that remain unvested as of the effective date of the Change of Control shall become fully
vested and exercisable as of such effective date. For purposes of this Agreement, the “Change in
Control Bonus” shall be based on the value of the transaction resulting in the Change of Control
and, at a minimum, shall be equal to $150,000 plus 1.5% of the transaction value in excess of
$26,000,000.

In addition, in the event of the termination of Employee’s employment pursuant to Section
4(b)(vi) above Employee shall continue to receive his Base Salary and benefits for a one-year
period following the date of termination of Employee’s employment pursuant to this Agreement. Such
Base Salary payments will be payable in one lump-sum amount within 10 days of the event of
termination. Should Employee become eligible for benefits in connection with a new employer during
the one-year period, Employers obligation for benefits shall cease.

Finally, Employer shall forgive any balance owed by Employee pursuant to Employer’s funding of
Employee’s Group Life Insurance policy.

     5. Competition and Confidential Information.

          (a) Interests to be Protected. For purposes of this Section 5, the term “Employer” shall include Vodavi
Technology, Inc. and any entity that is a direct or indirect subsidiary of Vodavi Technology, Inc.
during the term of this Agreement. The parties acknowledge that Employee will perform essential
services for Employer during the term of Employee’s employment with Employer. Employee will be
exposed to, have access to, and be required to work with a considerable amount of Confidential
Information (as defined below). The parties also expressly recognize and acknowledge that the
personnel of Employer have been trained by and are valuable to Employer and that Employer will
incur substantial expense in recruiting and training personnel if it must hire new personnel or
retrain existing personnel to fill vacancies. The parties also expressly recognize that it could
seriously impair the goodwill and diminish the value of Employer’s business should Employee compete
with Employer in any manner whatsoever. The parties acknowledge that this covenant has an extended
duration; however, they agree that this covenant is reasonable, and it is necessary for the
protection of Employer, its stockholders, and employees. For these and other reasons, and the fact
that there are many other employment opportunities available to Employee if his employment with
Employer is terminated, the parties are in full and complete agreement that the following
restrictive covenants are fair and reasonable and are entered into freely, voluntarily, and
knowingly. Furthermore, each party was given the opportunity to consult with independent legal
counsel before entering into this Agreement.

          (b) Non-Competition. During the term of Employee’s employment with Employer and for the
period ending 12 months after the termination of Employee’s employment with Employer, regardless of
the reason therefore, Employee shall not (whether directly or indirectly, as owner, principal,
agent, stockholder, director, officer, manager, employee, partner, participant, or in any other
capacity) engage in or become financially interested in any competitive business conducted within
the Restricted Territory (as defined

4

 

below). As used herein, the term “competitive business” shall
mean any business that designs, develops, markets, or supports commercial telephone systems,
commercial grade telephones, voice processing systems (including, but not limited to, automated
attendant, voice mail, or fax mail), computer-telephony integration products, and related computer
software products; and the term “Restricted Territory” shall mean any area in which Employer
conducts its business during Employee’s employment hereunder.

          (c) Non-Solicitation of Employees. During the term of Employee’s employment and for a period
of 12 months after the termination of Employee’s employment with Employer, regardless of the reason
therefore, Employee shall not directly or indirectly, for himself, or on behalf of, or in
conjunction with, any other person, company, partnership, corporation, or other entity, seek to
hire or hire any of Employer’s personnel or employees, with the exception of his Executive
Assistant, for the purpose of having such employee engage in services that are the same, similar,
or related to the services that such employee provided for Employer.

          (d) Confidential Information. Employee shall maintain in strict secrecy all confidential or
trade secret
information, whether patentable or not, relating to the business of Employer (the
“Confidential Information”) obtained by Employee in the course of Employee’s employment, and
Employee shall not, unless first authorized in writing by Employer, disclose to, or use for
Employee’s benefit or for the benefit of any person, firm, or entity at any time either during or
subsequent to the term of Employee’s employment, any Confidential Information, except as required
in the performance of Employee’s duties on behalf of Employer. For purposes hereof, Confidential
Information shall include without limitation any technical plans and drawings or other
reproductions or materials of any kind; any financial information with respect to Employer or its
business; any trade secrets, knowledge, or information with respect to products, processes,
inventions, formulae, software, source codes, object codes, algorithms, and services provided; any
operating procedures, techniques, or know-how; any business methods or forms; any names, addresses,
or data on suppliers or customers; and any business policies or other information relating to or
dealing with the purchasing, sales, advertising, promotional, or distribution policies or practices
of Employer.

          (e) Return of Books and Papers. Upon the termination of Employee’s employment with Employer
for any reason, Employee shall deliver promptly to Employer all samples or demonstration models,
catalogues, manuals, memoranda, drawings, software, source or object code, formulae, and
specifications, and operating procedures; all cost, pricing, and other financial data; all supplier
and customer information; all other written or printed materials that are the property of Employer
(and any copies of them); and all other materials which may contain Confidential Information
relating to the business of Employer, which Employee may then have in his possession whether
prepared by Employee or not.

          (f) Disclosure of Information. Employee shall disclose promptly to Employer, or its nominee,
any and all ideas, designs, processes, and improvements of any kind relating to the business of
Employer, whether patentable or not, conceived or made by Employee, either alone or jointly with
others, during working hours or otherwise, during the entire period of Employee’s employment with
Employer, or within six months thereafter.

5

 

          (g) Assignment. Employee hereby assigns to Employer or its nominee the entire right, title,
and interest in and to all inventions, discoveries, and improvements, whether patentable or not,
that Employee may conceive or make during Employee’s employment with Employer, or within six months
thereafter, and which relate to the business of Employer. Whenever requested to do so by Employer,
whether during the period of Employee’s employment or thereafter, Employee shall execute any and
all applications, assignments, and other instruments that Employer shall deem necessary or
appropriate to apply for, obtain, or maintain Letters Patent of the United States or of any foreign
country, or to protect otherwise the interest of Employer therein.

          (h) Equitable Relief. In the event a violation of any of the restrictions contained in this Section 5 is
established, Employer shall be entitled to preliminary and permanent injunctive relief as well as
damages and an equitable accounting of all earnings, profits, and other benefits arising from such
violation, which right shall be cumulative and in addition to any other rights or remedies to which
Employer may be entitled. In the event of a violation of any provision of Sections 5(b),
5(c), 5(f), or 5(g) of this Agreement, the period for which those
provisions would remain in effect shall be extended for a period of time equal to that period
beginning when such violation commenced and ending when the activities constituting such violation
shall have been finally terminated in good faith.

          (i) Restrictions Separable. If the scope of any provision of this Section 5 is found
by a Court to be too broad to permit enforcement to its full extent, then such provision shall be
enforced to the maximum extent permitted by law. The parties agree that the scope of any provision
of this Section 5 may be modified by a judge in any proceeding to enforce this Agreement,
so that such provision can be enforced to the maximum extent permitted by law. Each and every
restriction set forth in this Section 5 is independent and severable from the others, and
no such restriction shall be rendered unenforceable by virtue of the fact that, for any reason, any
other or others of them may be unenforceable in whole or in part.

          (j) Survival. Employer and Employee acknowledge and agree that the obligations and rights set
forth in this Section 5 shall survive the termination of this Agreement and Employee’s
employment by either Employer or Employee under Section 4 of this Agreement.

     6. Miscellaneous.

          (a) Notices. All notices, requests, demands, and other communications required or permitted
under this Agreement shall be in writing and shall be deemed to have been duly given, made, and
received (i) if personally delivered, on the date of delivery, (ii) if by facsimile transmission,
24 hours after transmitter’s confirmation of the receipt of such transmission, (iii) if mailed,
three days after deposit in the United States mail, registered or certified, return receipt
requested, postage prepaid and addressed as provided below, or (iv) if by a courier delivery
service providing overnight or “next-day” delivery, on the next business day after deposit with
such service addressed as follows:

6

 

	 	 	 	 	 	 	 
	 

	 	 	(1	)	 	If to Employer:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	Vodavi Technology, Inc.
	 

	 	 	 	 	 	4717 East Hilton Avenue
	 

	 	 	 	 	 	Suite 400
	 

	 	 	 	 	 	Phoenix, Arizona 85034
	 

	 	 	 	 	 	Attention: Chairman of the Board
	 

	 	 	 	 	 	Fax: (480) 483-0144
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	with a copy given in the manner

	 

	 	 	 	 	 	prescribed above, to:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	Greenberg Traurig, LLP
	 

	 	 	 	 	 	2375 E. Camelback Road, Suite 700
	 

	 	 	 	 	 	Phoenix, Arizona 85016
	 

	 	 	 	 	 	Attention: Robert S. Kant, Esq.
	 

	 	 	 	 	 	Fax: (602) 445-8100
	 
	 	 	 	 	 	 
	 

	 	 	(2	)	 	If to Employee:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	Gregory K. Roeper
	 

	 	 	 	 	 	6249 N. 78th Street, Unit 21
	 

	 	 	 	 	 	Scottsdale, Arizona 85250

Either party may alter the address to which communications or copies are to be sent by giving
notice of such change of address in conformity with the provisions of this paragraph for the giving
of notice.

          (b) Indulgences; Waivers. Neither any failure nor any delay on the part of either party to
exercise any right, remedy, power, or privilege under this Agreement shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege
preclude any other or further exercise of the same or of any other right, remedy, power, or
privilege, nor shall any waiver of any right, remedy, power, or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power, or privilege with respect to any
other occurrence. No waiver shall be binding unless executed in writing by the party making the
waiver.

          (c) Controlling Law. This Agreement and all questions relating to its validity,
interpretation, performance, and enforcement shall be governed by and construed in accordance with
the laws of the state of Arizona, notwithstanding any Arizona or other conflict-of-interest
provisions to the contrary.

          (d) Binding Nature of Agreement; Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the
parties hereto and their respective heirs, personal representatives, successors, and assigns;
provided that because the obligations of Employee hereunder involve the performance of personal
services, such obligations shall not be delegated by Employee. For purposes of this Agreement,
successors and assigns shall include, but not be limited to, any individual, corporation, trust,
partnership, or

7

 

other entity that acquires a majority of the stock or assets of Employer by sale,
merger, consolidation, liquidation, or other form of transfer. Employer will require any successor
(whether direct or indirect, by purchase, merger, consolidation, or otherwise) to all or
substantially all of the business and/or assets of Employer to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that Employer would be required to
perform it if no such succession had taken place.

          (e) Execution in Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original as against any party whose signature appears
thereon, and all of which shall together constitute one and the same instrument. This Agreement
shall become binding when one or more counterparts hereof, individually or taken together, shall
bear the signatures of the parties reflected hereon as the signatories.

          (f) Provisions Separable. The provisions of this Agreement are independent of and separable
from each other, and no provision shall be affected or rendered invalid or unenforceable by virtue
of the fact that for any reason any other or others of them may be invalid or unenforceable in
whole or in part.

          (g) Entire Agreement. This Agreement contains the entire agreement and understanding between
the parties hereto with respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements and understandings, inducements and conditions, express or implied, oral
or written, except as herein contained. The express terms hereof control and supersede any course
of performance and/or usage of the trade inconsistent with any of the terms hereof. This Agreement
may not be modified or amended other than by an agreement in writing.

          (h) Paragraph Headings. The paragraph headings in this Agreement are for convenience only;
they form no part of this Agreement and shall not affect its interpretation.

          (i) Number of Days. In computing the number of days for purposes of this Agreement, all days
shall be counted, including Saturdays, Sundays, and holidays; provided, however, that if the final
day of any time period falls on a Saturday, Sunday, or holiday, then the final day shall be deemed
to be the next day that is not a Saturday, Sunday, or holiday.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

8

 

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above
written.

	 	 	 	 	 
	 	VODAVI TECHNOLOGY, INC.

 	 
	 	By:  	/s/ William J. Hinz
 	 
	 	 	William J. Hinz 	 
	 	 	Chairman of the Board 	 
	 
	 	EMPLOYEE

	 
	 	/s/ Gregory K. Roeper 	 
	 	Gregory K. Roeper	 

9exv10w62

 

Exhibit 10.62

EMPLOYMENT AGREEMENT

EFFECTIVE AS OF JANUARY 1, 2006

BETWEEN

VODAVI TECHNOLOGY, INC.

AND

DAVID A. HUSBAND

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	1.Employment
	 	 	1	 
	2. Full Time Occupation
	 	 	1	 
	3. Compensation and other Benefits
	 	 	1	 
	(a) Salary
	 	 	1	 
	(b) Bonus
	 	 	1	 
	(c) Reimbursement
	 	 	2	 
	(d) Fringe Benefits
	 	 	2	 
	4. Term of Employment
	 	 	2	 
	(a) Employment Term
	 	 	2	 
	(b) Termination Under Certain Circumstances
	 	 	2	 
	(c) Result of Termination
	 	 	4	 
	(d) Result of Change of Control
	 	 	4	 
	5. Competition and Confidential Information
	 	 	4	 
	(a) Interests to be Protected
	 	 	4	 
	(b) Non-Competition
	 	 	5	 
	(c) Non-Solicitation of Employees
	 	 	5	 
	(d) Confidential Information
	 	 	6	 
	(e) Return of Books and Papers
	 	 	6	 
	(f) Disclosure of Information
	 	 	6	 
	(g) Assignment
	 	 	6	 
	(h) Equitable Relief
	 	 	6	 
	(i) Restrictions Separable
	 	 	7	 
	(j) Survival
	 	 	7	 
	6. Miscellaneous
	 	 	7	 
	(a) Notices
	 	 	7	 
	(b) Indulgences; Waivers
	 	 	8	 
	(c) Controlling Law
	 	 	8	 
	(d) Binding Nature of Agreement; Successors and Assigns
	 	 	8	 
	(e) Execution in Counterparts
	 	 	8	 
	(f) Provisions Separable
	 	 	9	 
	(g) Entire Agreement
	 	 	9	 
	(h) Paragraph Headings
	 	 	9	 
	(i) Number of Days
	 	 	9	 

 

 

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (“Agreement”) is made as of January 29, 2006, to be effective as of
January 1, 2006 (the “Effective Date”) by and between VODAVI TECHNOLOGY, INC., a Delaware
corporation (“Employer”) and DAVID A. HUSBAND (“Employee”).

RECITALS

     A. Employer and Employee are currently parties to that certain Employment Agreement dated
February 10, 2004 and effective January 1, 2004 (the “Prior Employment Agreement”).

     B. Pursuant to Section 6(g) of the Prior Employment Agreement, the Prior Employment Agreement
may not be modified or amended other than by an agreement in writing.

     C. Employer desires to continue to employ Employee and Employee desires to continue such
employment, all on the terms and conditions hereinafter set forth.

     D. Employer and Employee believe that it is in their mutual best of interests that this
Agreement supersede the Prior Employment Agreement in its entirety pursuant to the terms hereof.

AGREEMENT

     NOW, THEREFORE, in consideration of the premises and of the mutual covenants set forth in this
Agreement, the parties hereto agree as follows:

     1. Employment. Employer hereby employs Employee, and Employee hereby accepts such employment,
as Vice President — Finance and Chief Financial Officer of Employer and in such other executive
capacities and for such other executive duties and services as shall from time to time be mutually
agreed upon by Employer and Employee.

     2. Full Time Occupation. Employee shall devote Employee’s entire business time, attention,
and efforts to the performance of Employee’s duties under this Agreement, and shall serve Employer
faithfully and diligently and shall not engage in any other employment while employed by Employer.

     3. Compensation and other Benefits.

          (a) Salary. Employer shall pay to Employee, as compensation for the services rendered by
Employee during Employee’s employment under this Agreement, a base salary at a
rate of $175,000 per annum (the “Base Salary”). Employer shall pay the Base Salary in
accordance with Employer’s established payroll procedures.

          (b) Bonus. In addition to the Base Salary, Employee shall be eligible to receive annual bonus
compensation (the “Bonus”) in an amount to be set by the Compensation Committee of Employer’s Board
of Directors, at the committee’s sole and exclusive discretion.

 

 

          (c) Reimbursement. Employer shall reimburse Employee for all travel and entertainment
expenses and other ordinary and necessary business expenses incurred by Employee in connection with
the business of Employer and Employee’s duties under this Agreement. The term “business expenses”
shall not include any item not at least partially deductible by Employer for federal income tax
purposes. Reimbursements shall be made by Employer in accordance with Employer’s normal expense
policies and procedures.

          (d) Fringe Benefits. Employee shall be entitled to participate in any group insurance,
pension, retirement, vacation, expense reimbursement, and other plans, programs, and benefits
approved by the Board of Directors and made available from time to time to executive employees of
Employer generally during the term of Employee’s employment hereunder. The foregoing shall not
obligate Employer to adopt or maintain any particular plan, program, or benefit.

     4. Term of Employment.

          (a) Employment Term. The term of Employee’s employment hereunder shall commence on the date
hereof and shall continue until December 31, 2006. The term of Employee’s employment hereunder
shall automatically renew for successive one-year terms, unless and until terminated by either
party giving written notice to the other not less than 30 days prior to the end of the then-current
term or as otherwise set forth in Section 4(b).

          (b) Termination Under Certain Circumstances. Notwithstanding anything to the contrary herein
contained:

               (i) Death. Employee’s employment and this Agreement shall be automatically terminated,
without notice, effective upon the date of Employee’s death.

               (ii) Disability . If Employee shall fail to perform any of Employee’s essential job duties under this
Agreement as the result of illness or other incapacity, with or without reasonable accommodation,
for a period of more than 12 consecutive weeks, or for more than 12 weeks within any 12-month
period, as determined by Employer for purposes of compliance with the Family and Medical Leave Act,
Employer may, at its option, and upon notice to Employee, terminate Employee’s employment and this
Agreement effective on the date of that notice.

               (iii) Unilateral Decision of Employer. Employer may, at its option, upon notice to Employee,
terminate Employee’s employment and this Agreement effective on the date of that notice. A
material reduction in Employee’s responsibilities, as such responsibilities are described in
Section 1 of this Agreement, by Employer shall constitute a termination under this
Section 4(b)(iii).

               (iv) Unilateral Decision by Employee. Employee may, at his option and upon notice to
Employer, terminate Employee’s employment and this Agreement effective on the date of that notice.

               (v) Termination for Cause. Employer may terminate Employee’s employment under this Agreement
at any time, effective upon written notice to

2

 

Employee, if the termination of Employee’s employment
is for Cause. For purposes of this Section 4(b)(v), for Cause shall mean: (A) the failure
or refusal of Employee to perform the duties or render the services reasonably assigned to him from
time to time by the Board of Directors; (B) gross negligence or willful misconduct by Employee in
the performance of his duties as an employee of Employer; (C) the charging or indictment of
Employee in connection with a felony; (D) the association, directly or indirectly, of Employee, for
his profit or financial benefit, with any person, firm, partnership, association, entity or
corporation that competes, in any material way, with Employer; (E) the disclosing or using of any
material “Confidential Information” (as hereinafter defined) of Employer at any time by Employee,
except as required in connection with his duties to Employer; (F) the breach by Employee of his
fiduciary duty or duty of trust to Employer, including the commission by Employee of an act of
fraud or embezzlement against Employer; (G) chronic absenteeism; (H) substance abuse; or (I) any
other material breach by Employee of any of the terms or provisions of this Agreement, which other
material breach is not cured within ten (10) business days of notice by Employer.

               (vi) Change of Control. In the event of a Change of Control (as defined below), Employer or
Employee may, at their respective option, upon notice to the other, terminate Employee’s employment
by providing the other party with 30 days’ written notice after the effective date of the Change of
Control. For the purposes of this Agreement, a “Change in Control” shall mean a change in control
of Employer of a nature that would be required to be reported in response to Item 6(e) of Schedule
14A of Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended, as in
effect on the date of this Agreement, or if Item 6(e) is no longer in effect, any regulations
issued by the Securities and Exchange
Commission pursuant to the Securities Exchange Act of 1934, as amended, which serve similar
purposes; provided further that, without limitation, a Change in Control shall be deemed to have
occurred if and when:

                    (A) Turnover of Board. The following individuals no longer constitute a majority of the
members of the Board of Directors of Employer: (1) the individuals who, as of the date of this
Agreement, constitute the Board of Directors of Employer (the “Current Directors”); (2) the
individuals who thereafter are elected to the Board of Directors of Employer and whose election, or
nomination for election, to the Board of Directors of Employer was approved by a vote of at least a
majority of the Current Directors then still in office (such directors becoming “Additional
Directors” immediately following their election); and (3) the individuals who are elected to the
Board of Directors of Employer and whose election, or nomination for election, to the Board of
Directors of Employer was approved by a vote of at least a majority of the Current Directors and
Additional Directors then still in office (such directors also becoming “Additional Directors”
immediately following their election);

                    (B) Tender Offer. A tender offer or exchange offer is made whereby the effect of such offer
is to take over and control Employer, and such offer is consummated for the equity securities of
Employer representing thirty percent (30%) or more of the combined voting power of Employer’s then
outstanding voting securities;

                    (C) Merger or Consolidation. The stockholders of Employer shall approve a merger,
consolidation, recapitalization, or reorganization of Employer, a reverse stock split of
outstanding voting securities, or consummation of any such transaction if

3

 

stockholder approval is
not obtained, other than any such transaction that would result in at least seventy-five percent
(75%) of the total voting power represented by the voting securities of the surviving entity
outstanding immediately after such transaction being beneficially owned by the holders of
outstanding voting securities of Employer immediately prior to the transaction, with the voting
power of each such continuing holder relative to other such continuing holders not substantially
altered in the transaction; or

                    (D) Liquidation or Sale of Assets. The stockholders of Employer shall approve a plan of
complete liquidation of Employer or an agreement for the sale or disposition by Employer of all or
a substantial portion of Employer’s assets to another person or entity, which is not a wholly owned
subsidiary of Employer (i.e., fifty percent (50%) or more of the total assets of Employer).

          (c) Result of Termination. In the event of the termination of Employee’s employment pursuant
to Sections 4(b)(i), (iv), or (v) above, Employee shall receive no further
compensation under this
Agreement and all of Employee’s unvested options shall be cancelled. In the event of the
termination of Employee’s employment pursuant to Section 4(b)(ii) or (iii) above,

               (i) Employee shall continue to receive his Base Salary and benefits during the Severance
Period. For purposes of this Agreement, the “Severance Period” shall be a period commencing on the
date of termination and ending on the date that is twelve months following the date of termination;
and

               (ii) Employee’s vested options as of the date of termination shall remain outstanding through
the 120-day period following the then-current term of this Agreement. All of Employee’s unvested
options as of the date of termination shall be cancelled.

          (d) Result of Change of Control. As incentive for Employee to actively pursue the best interests
of Employer’s stockholders, in the event of a Change of Control (as that term is defined in
Section 4(b)(vi) of this Agreement), then (i) Employee shall earn the Change of Control
Bonus, which shall be paid in one lump sum payment within ten business days from the effective date
of the Change of Control in the event of a Change of Control; and (ii) any options held by Employee
that remain unvested as of the effective date of the Change of Control shall become fully vested
and exercisable as of such effective date. For purposes of this Agreement, the “Change of
ControlBonus” shall be based on the value of the transaction resulting in the Change of Control
and, at a minimum, shall be equal to $100,000 plus 1% of the transaction value in excess of
$26,000,000. The Change of Control Bonus shall be payable in cash, securities, or other
consideration in the same proportions as paid in the transaction resulting in the Change of
Control. In addition, in the event of the termination of Employee’s employment pursuant to
Section 4(b)(vi) above Employee shall continue to receive his Base Salary during the
Severance Period.

     5. Competition and Confidential Information.

          (a) Interests to be Protected. For purposes of this Section 5, the term “Employer”
shall include Vodavi Technology, Inc. and any entity that is a direct or indirect

4

 

subsidiary of
Vodavi Technology, Inc. during the term of this Agreement. The parties acknowledge that Employee
will perform essential services for Employer during the term of Employee’s employment with
Employer. Employee will be exposed to, have access to, and be required to work with a considerable
amount of Confidential Information (as defined below). The parties also expressly recognize and
acknowledge that the personnel of Employer have been trained by and are valuable to Employer and
that Employer will incur substantial expense in recruiting and training personnel if it must hire
new personnel or retrain existing personnel to fill vacancies. The parties also expressly
recognize that it could seriously impair the goodwill and diminish the value of Employer’s business
should Employee compete with Employer in any manner whatsoever. The parties acknowledge that this
covenant has an extended duration; however, they agree that this covenant is reasonable, and it is
necessary for the protection of Employer, its stockholders, and employees. For these and other
reasons, and the fact that there are many other employment opportunities available to Employee if
his employment with Employer is terminated, the parties
are in full and complete agreement that the following restrictive covenants are fair and
reasonable and are entered into freely, voluntarily, and knowingly. Furthermore, each party was
given the opportunity to consult with independent legal counsel before entering into this
Agreement.

          (b) Non-Competition. During the term of Employee’s employment with Employer and for the
period ending 12 months after the termination of Employee’s employment with Employer, or, in the
alternative, in the event any reviewing court finds 12 months to be overbroad or unenforceable, for
a period of nine months after the termination of Employee’s employment with Employer, or, in the
alternative, in the event any reviewing court finds nine months to be overbroad or unenforceable,
for a period of six months after the termination of Employee’s employment with Employer, or, in the
alternative, in the event any reviewing court finds six months to be overbroad or unenforceable,
for a period of three months after the termination of Employee’s employment with Employer,
regardless of the reason therefor, Employee shall not (whether directly or indirectly, as owner,
principal, agent, stockholder, director, officer, manager, employee, partner, participant, or in
any other capacity) engage in or become financially interested in any competitive business
conducted within the Restricted Territory (as defined below). As used herein, the term
“competitive business” shall mean any business that designs, develops, markets, or supports
commercial telephone systems, commercial grade telephones, voice processing systems (including, but
not limited to, automated attendant, voice mail, or fax mail), computer-telephony integration
products, and related computer software products; and the term “Restricted Territory” shall mean
any area in which Employer conducts its business during Employee’s employment hereunder.

          (c) Non-Solicitation of Employees. During the term of Employee’s employment and for a period
of 12 months after the termination of Employee’s employment with Employer, or, in the alternative,
in the event any reviewing court finds 12 months to be overbroad or unenforceable, for a period of
nine months after the termination of Employee’s employment with Employer, or, in the alternative,
in the event any reviewing court finds nine months to be overbroad or unenforceable, for a period
of six months after the termination of Employee’s employment with Employer, or, in the alternative,
in the event any reviewing court finds six months to be overbroad or unenforceable, for a period of
three months after the termination of Employee’s employment with Employer, regardless of the reason
therefor, Employee shall not directly or indirectly, for himself, or on behalf of, or in
conjunction with, any

5

 

other person, company, partnership, corporation, or other entity, seek to
hire or hire any of Employer’s personnel or employees for the purpose of having such employee
engage in services that are the same, similar, or related to the services that such employee
provided for Employer.

          (d) Confidential Information. Employee shall maintain in strict secrecy all confidential or
trade secret information, whether patentable or not, relating to the business of Employer (the
“Confidential Information”) obtained by Employee in the course of Employee’s employment, and
Employee shall not, unless first authorized in writing by Employer, disclose to, or use for
Employee’s benefit or for the benefit of any person, firm, or entity at any time either during or
subsequent to the term of Employee’s employment, any Confidential Information, except as required
in the performance of Employee’s duties on behalf of Employer. For purposes hereof, Confidential
Information shall include without limitation any technical plans and drawings or other
reproductions or materials of any kind; any financial information with respect to Employer or its
business; any trade secrets, knowledge, or information with respect to products, processes,
inventions, formulae, software, source codes, object codes, algorithms, and services provided; any
operating procedures, techniques, or know-how; any business methods or forms; any names, addresses,
or data on suppliers or customers; and any business policies or other information relating to or
dealing with the purchasing, sales, advertising, promotional, or distribution policies or practices
of Employer.

          (e) Return of Books and Papers. Upon the termination of Employee’s employment with Employer
for any reason, Employee shall deliver promptly to Employer all samples or demonstration models,
catalogues, manuals, memoranda, drawings, software, source or object code, formulae, and
specifications, and operating procedures; all cost, pricing, and other financial data; all supplier
and customer information; all other written or printed materials that are the property of Employer
(and any copies of them); and all other materials which may contain Confidential Information
relating to the business of Employer, which Employee may then have in his possession whether
prepared by Employee or not.

          (f) Disclosure of Information. Employee shall disclose promptly to Employer, or its nominee,
any and all ideas, designs, processes, and improvements of any kind relating to the business of
Employer, whether patentable or not, conceived or made by Employee, either alone or jointly with
others, during working hours or otherwise, during the entire period of Employee’s employment with
Employer, or within six months thereafter.

          (g) Assignment. Employee hereby assigns to Employer or its nominee the entire right, title,
and interest in and to all inventions, discoveries, and improvements, whether patentable or not,
that Employee may conceive or make during Employee’s employment with Employer, or within six months
thereafter, and which relate to the business of Employer. Whenever requested to do so by Employer,
whether during the period of Employee’s employment or thereafter, Employee shall execute any and
all applications, assignments, and other instruments that Employer shall deem necessary or
appropriate to apply for, obtain, or maintain Letters Patent of the United States or of any foreign
country, or to protect otherwise the interest of Employer
therein.

          (h) Equitable Relief. In the event a violation of any of the restrictions contained in this
Section 5 is established, Employer shall be entitled to preliminary and

6

 

permanent
injunctive relief as well as damages and an equitable accounting of all earnings, profits, and
other benefits arising from such violation, which right shall be cumulative and in addition to any
other rights or remedies to which Employer may be entitled. In the event of a violation of any
provision of Sections 5(b), 5(c), 5(f), or 5(g) of this Agreement,
the period for which those provisions would remain in effect shall be extended for a period of time
equal to that period beginning when such violation commenced and ending when the activities
constituting such violation shall have been finally terminated in good faith.

          (i) Restrictions Separable. If the scope of any provision of this Section 5 is found
by a Court to be too broad to permit enforcement to its full extent, then such provision shall be
enforced to the maximum extent permitted by law. The parties agree that the scope of any provision
of this Section 5 may be modified by a judge in any proceeding to enforce this Agreement,
so that such provision can be enforced to the maximum extent permitted by law. Each and every
restriction set forth in this Section 5 is independent and severable from the others, and
no such restriction shall be rendered unenforceable by virtue of the fact that, for any reason, any
other or others of them may be unenforceable in whole or in part.

          (j) Survival. Employer and Employee acknowledge and agree that the obligations and rights set
forth in this Section 5 shall survive the termination of this Agreement and Employee’s
employment by either Employer or Employee under Section 4 of this Agreement.

     6. Miscellaneous.

          (a) Notices. All notices, requests, demands, and other communications required or permitted
under this Agreement shall be in writing and shall be deemed to have been duly given, made, and
received (i) if personally delivered, on the date of delivery, (ii) if by facsimile transmission,
24 hours after transmitter’s confirmation of the receipt of such transmission, (iii) if mailed,
three days after deposit in the United States mail, registered or certified, return receipt
requested, postage prepaid and addressed as provided below, or (iv) if by a courier delivery
service providing overnight or “next-day” delivery, on the next business day after deposit with
such service addressed as follows:

	 	 	 	 	 	 	 
	 

	 	 	(1	)	 	If to Employer:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	Vodavi Technology, Inc.
	 

	 	 	 	 	 	4717 East Hilton Avenue
	 

	 	 	 	 	 	Suite 400
	 

	 	 	 	 	 	Phoenix, Arizona 85034
	 

	 	 	 	 	 	Attention: Chairman of the Board
	 

	 	 	 	 	 	Fax: (480) 483-0144

7

 

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	with a copy given in the manner
	 

	 	 	 	 	 	prescribed above, to:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	Greenberg Traurig, LLP
	 

	 	 	 	 	 	2375 E. Camelback Road, Suite 700
	 

	 	 	 	 	 	Phoenix, Arizona 85016
	 

	 	 	 	 	 	Attention: Robert S. Kant, Esq.
	 

	 	 	 	 	 	Fax: (602) 445-8100
	 
	 	 	 	 	 	 
	 

	 	 	(2	)	 	If to Employee:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	David A. Husband
	 

	 	 	 	 	 	16608 S. 15th Drive
	 

	 	 	 	 	 	Phoenix, Arizona 85045

Either party may alter the address to which communications or copies are to be sent by giving
notice of such change of address in conformity with the provisions of this paragraph for the giving
of notice.

          (b) Indulgences; Waivers. Neither any failure nor any delay on the part of either party to
exercise any right, remedy, power, or privilege under this Agreement shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege
preclude any other or further exercise of the same or of any other right, remedy, power, or
privilege, nor shall any waiver of any right, remedy, power, or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power, or privilege with respect to any
other occurrence. No waiver shall be binding unless executed in writing by the party making the
waiver.

          (c) Controlling Law. This Agreement and all questions relating to its validity,
interpretation, performance, and enforcement shall be governed by and construed in accordance with
the laws of the state of Arizona, notwithstanding any Arizona or other conflict-of-interest
provisions to the contrary.

          (d) Binding Nature of Agreement; Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective heirs, personal
representatives, successors, and assigns; provided that because the obligations of Employee
hereunder involve the performance of personal services, such obligations shall not be delegated by
Employee. For purposes of this Agreement, successors and assigns shall include, but not be limited
to, any individual,
corporation, trust, partnership, or other entity that acquires a majority of the stock or
assets of Employer by sale, merger, consolidation, liquidation, or other form of transfer.
Employer will require any successor (whether direct or indirect, by purchase, merger,
consolidation, or otherwise) to all or substantially all of the business and/or assets of Employer
to expressly assume and agree to perform this Agreement in the same manner and to the same extent
that Employer would be required to perform it if no such succession had taken place.

          (e) Execution in Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original as against any party

8

 

whose signature appears
thereon, and all of which shall together constitute one and the same instrument. This Agreement
shall become binding when one or more counterparts hereof, individually or taken together, shall
bear the signatures of the parties reflected hereon as the signatories.

          (f) Provisions Separable. The provisions of this Agreement are independent of and separable
from each other, and no provision shall be affected or rendered invalid or unenforceable by virtue
of the fact that for any reason any other or others of them may be invalid or unenforceable in
whole or in part.

          (g) Entire Agreement. This Agreement contains the entire agreement and understanding between
the parties hereto with respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements and understandings, inducements and conditions, express or implied, oral
or written, except as herein contained. The express terms hereof control and supersede any course
of performance and/or usage of the trade inconsistent with any of the terms hereof. This Agreement
may not be modified or amended other than by an agreement in writing.

          (h) Paragraph Headings. The paragraph headings in this Agreement are for convenience only;
they form no part of this Agreement and shall not affect its interpretation.

          (i) Number of Days. In computing the number of days for purposes of this Agreement, all days
shall be counted, including Saturdays, Sundays, and holidays; provided, however, that if the final
day of any time period falls on a Saturday, Sunday, or holiday, then the final day shall be deemed
to be the next day that is not a Saturday, Sunday, or holiday.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

9

 

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above
written.

	 	 	 	 	 	 	 
	 	 	VODAVI TECHNOLOGY, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Gregory K. Roeper
 

Gregory K. Roeper
	 	 
	 

	 	Title:
	 	Chief Executive Officer and President	 	 
	 
	 	 	 	 	 	 
	 	 	EMPLOYEE	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ David A. Husband	 	 
	 	 	 	 	 
	 	 	David A. Husband	 	 

10

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