[DIALOGIC CORPORATION LETTERHEAD]
DIALOGIC CONFIDENTIAL
Theodore Weitz May 27, 1999
Dialogic Corporation
Dear Ted:
In the light of the potential that Dialogic will engage in a transaction in
which there is a Change In Control of the Company (as that term is defined in
the 1997 Incentive Compensation Plan) and the importance of your contributions
to achieving both a successful transaction and a smooth transition, the Board
of Directors has approved a special payment plan applicable to you as one of a
select group of employees. Subject to the closing of a Change of Control
transaction approved by the Board of Directors (the "Closing"), and provided
that you are still employed by the Company (except in case of a Termination
Event as defined below) thirty days after the Closing, the Company will make
the following special incentive payment to you, in addition to your normal
compensation:
Payment Number Payment Date Payment Amount
- -------------- ------------ --------------
1 30 days after Closing 50% of Target Total Cash
Compensation
In addition, in order to provide you with the incentive to remain in the
employ of the Company (and its successor) through the transition period
subsequent to any such transaction, and in light of your unique knowledge of the
Company and the industry, the Company will make the following additional special
retention/severance payments to you, provided that you are still employed by the
Company (except in case of a Termination Event as defined below) on the payment
date:
2 90 days after Closing 150% of TTCC
Notwithstanding the requirement of continued employment, if you are subject
to a Termination Event (defined to be an involuntary termination other than for
Cause, or a reduction in compensation) subsequent to the Closing, each of the
above payments shall immediately become payable in full.
In the event that you are paid a severance or special retention payment
(excluding pay increases or bonuses given in the ordinary course of business)
by the acquiring entity, the above payments other than payment Number 1 shall
be pro tanto reduced. Notwithstanding any other provision of this Agreement, to
the extent that the net payment to you after taxes, considering the impact
of Section 280G of the Internal Revenue Code, would be higher if the payments
specified herein were reduced or eliminated, then such payments will be reduced
to achieve the maximum net after tax benefit to you and you shall not be
entitled to the full specified amount. Any such reduction in payments shall
first be made on the latest payment otherwise due to you. The Company will
assist you in calculating the applicable amounts of such payments as close to
the time of Closing as practicable.
For purposes of this Agreement Target Total Cash Compensation ("TTCC")
includes base salary and Target MBO Bonus.
Please acknowledge your acceptance of these terms by signing and returning
one copy to me.
Sincerely yours,
/s/ HOWARD G. BUBB
- -------------------------
Howard G. Bubb
Accepted and Agreed By accepting this offer, you agree this is a
confidential matter between you and Dialogic
Corporation (or its successor). In addition, you will
[Signature Illegible] not disclose this offer or payment nor will you
directly or indirectly cause it to be disclosed to
other employees of Dialogic Corporation (or its
successor).