Amended Employment Agreement Sept. 13, 1999

This Amended Employment Agreement (this "Agreement") is made as of
--------- September 14, 1999 by and among U.S. Audiotex Corporation, a Delaware corporation (the "Company"), Imperial Bank ("Imperial") and Thomas R. Evans
------- -------- ("Executive"). ---------


RECITALS
--------


WHEREAS, the Company desires to continue to employ Executive to serve as Chief Executive Officer and Chairman of the Board of Directors (the "Board")
----- of the Company on the terms and conditions herein provided;


WHEREAS, Executive desires to become an employee of the Company on the terms and conditions herein provided;


WHEREAS, Imperial owns eighty percent (80%) of the shares of common stock of the Company and desires that the Company and Executive enter into this Agreement;


NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:


1. Employment. The Company hereby employs Executive, subject to the
---------- terms and conditions herein provided. During the Employment Period (as defined below), Executive shall faithfully and diligently perform his duties under this Agreement and shall use his best efforts to promote the interests of the Company.


Executive shall be appointed to the Board and elected as the Chairman ("Chairman") of the Board for the duration of the Employment Period. --------


The Company's corporate headquarters shall be located in or around New York City.


2. Term. Subject to the terms and conditions hereof, the initial
---- term of employment of Executive by the Company under this Agreement shall be for the period commencing on August 26, 1999 (the "Commencement Date") and
----------------- expiring when terminated as provided in Section 8 hereof (the "Expiration
---------- Date"). For purposes hereof, such period is referred to herein as the ---- "Employment Period." -----------------


3. Executive's Obligations.
-----------------------


Executive shall serve as Chairman and Chief Executive Officer of the Company with such powers and responsibilities as are customarily accorded to a chairman and chief executive officer in companies of comparable size within the same or similar industry. In his


capacity as Chief Executive Officer of the Company, Executive shall report directly to the Board of the Company. Executive shall at all times comply with and be subject to the Company's policies, procedures, directives and regulations as established by the Company from time to time. Executive accepts such employment, responsibility and authority and agrees to perform the services of Chairman and Chief Executive Officer of the Company and such other services as shall from time to time be reasonably assigned to him by or pursuant to authorization of the Board, and agrees to devote all of his working time, skill and attention to such services.


Notwithstanding the foregoing, the parties agree that the Executive may continue the educational, charitable and community activities (including membership on the board of educational, charitable or community organizations) in which he is engaged on the date hereof and may engage in other educational, charitable and community activities (including membership on the board of educational, charitable or community organizations) and serve on boards of directors of other companies provided such activities do not materially interfere with the performance of his duties to the Company.


4. Executive's Compensation and Benefits. During the Employment
------------------------------------- Period, as full compensation to the Executive for his performance of the services hereunder and for his acceptance of the responsibilities described herein, the Company agrees to pay the Executive, and the Executive agrees to accept, the following salary and other benefits:


4.1 Base Salary. The Company shall pay the Executive a salary at
----------- the annual rate of $200,000. The Board or the compensation committee of the Board (the "Compensation Committee") shall periodically review Executive's base
---------------------- salary on an annual basis beginning on or before the first anniversary of the date on which the Company's initial public offering is consummated (the "IPO
--- Date"), and may increase but not decrease such base salary, from time to time, ---- in their sole discretion. The base salary due the Executive hereunder (the "Base
---- Salary") shall be payable in accordance with the Company's standard payment ------ policy, less any amounts required to be withheld by the Company from such Base Salary pursuant to the benefit plans in which Executive participates pursuant to Section 4.5 and applicable laws and regulations.


4.2 Bonus. (a) The Executive shall be eligible to receive annual
----- bonuses (each a "Bonus") at the discretion of, and in the amounts and at the
----- times determined by, the Compensation Committee. Executive agrees that there can be no assurance that the Compensation Committee will grant a Bonus in any year.


(b) In addition, the Company shall pay a one-time bonus to the Executive in the amount of $500,000, $250,000 of which was paid on the Commencement Date and $250,000 of which shall be payable no later than the first anniversary of the Commencement Date, less any amounts required to be withheld by the Company from such bonus pursuant to applicable laws and regulations.


4.3 Long Term Incentives. On the Commencement Date, the Company will
-------------------- grant Executive options to acquire 250,000 shares of its common stock, which represents 5% of the Company's Fully Diluted Common Stock on the Commencement Date (inclusive of the 250,000 share option grant to Executive). On the IPO Date, the Company will grant executive


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additional options to acquire such number of shares of its common stock so that, when combined with the options granted in the immediately preceding sentence, Executive will have received pursuant to this Section 4.3 options to acquire shares of common stock equal to an aggregate of five percent (5%) of the Fully Diluted Common Stock of the Company outstanding as of the IPO Date (inclusive of the option grant to Executive). For purposes of this Section 4.3, "Fully Diluted
------------- Common Stock" shall mean the aggregate of (i) the number of shares of Company ------------ common stock authorized and outstanding determined on an as-converted basis and (ii) the number of shares of Company common stock subject to outstanding options, warrants and other rights to acquire Company common stock determined on an as-converted basis. Such options will be non-transferable and shall be exercisable at any time for a ten year period after the date of grant. The exercise price of such options shall be equal to $4.00 per share. All of the option shares shall initially be unvested and subject to repurchase by the Company at the exercise price paid per share. Subject to Section 8 hereof, Executive shall acquire a vested interest in, and the Company's repurchase right shall accordingly lapse with respect to one-third of the option shares granted pursuant to this Section 4.3 on the first anniversary of the Commencement Date and the remaining option shares in a series of twenty four (24) successive equal monthly installments during the Employment Period. Following termination of the Employment Period, Executive shall acquire a vested interest in, and the Company's repurchase right shall accordingly terminate with respect to, all of any unvested option shares for which the Company did not exercise its repurchase right within thirty (30) days following such termination. Executive shall be entitled to pay the exercise price of such options in the same manner and on the same terms as the Company offers to members of its senior management who receive similar options.


4.4 On the third anniversary of the Commencement Date, Imperial and/or a guarantor reasonably acceptable to Executive and Imperial shall pay to Executive, in cash, the amount, if any, by which the Guaranteed Amount (as defined below) exceeds the aggregate Value (as defined below) of the option shares which have vested pursuant to Section 4.3 (whether or not the options have been exercised) (the "Guarantee Payment"); provided, however, that if at
----------------- ----------------- any time prior to such third anniversary, the Value exceeds $10,000,000, all obligations under this Section 4.4 shall terminate and be of no further force and effect. In the event that, on or prior to the third anniversary of the Commencement Date, the Company has not consummated an initial public offering or been sold to any Person (as defined in Section 7.1) other than an affiliate of the Company, Imperial shall purchase from Executive, within five days of his request, Executive's interest in all, but not less than all, options or shares received under this Agreement for the amount equal to $10,000,000 less (i) the option exercise price of any unexercised options, and (ii) any net profit received by Executive in connection with any sale or transfer of any shares or options received under this Agreement (i.e., after netting out the option exercise price paid by Executive for the transferred shares); provided, that any options or shares sold or transferred shall be treated as if they were sold at the higher of the price received or fair market value at the time of sale. Executive shall have one week from the date of the third anniversary of the Commencement Date to request such payment. Thereafter, any rights to such payment shall terminate. For purposes of this Section 4.4, "Value" shall mean
----- (i) the product of (A) the highest average price of the common stock of the Company calculated over a period of any 10 consecutive Business Days (as defined below) from the Commencement Date until the third anniversary thereof, multiplied by (B) the number of option


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shares which have vested pursuant to Section 4.3 (whether or not the options have been exercised), less (ii) the product of (A) the weighted average exercise price of such vested options, multiplied by (B) the number of option shares which have vested pursuant to Section 4.3 (whether or not such options have been exercised). The value of the Company's common stock shall be based on the trading price, or other fair market value as mutually agreed by the Board and Executive if the common stock is not traded on a national stock exchange or quotation system. In the event that the Board and Executive are unable to agree upon the fair market value of the Company's common stock for purposes of determining Value under this Section 4.4, then the fair market value shall be determined by an investment banking firm mutually acceptable to the Board and Executive, provided that if the Board and Executive are unable to agree upon a mutually acceptable investment banking firm, each of the Board and Executive shall choose an investment banking firm, and the fair market value for purposes of this Section 4.4 shall be deemed to be the average of the fair market values determined by each investment banking firm. The "Guaranteed Amount" shall be
----------------- $10,000,000, reduced by the amount of the Value of the option shares which have vested on the first or second anniversary of the Commencement Date, whichever is greater, calculated based on the last 10 Business Days prior to such anniversary. "Business Days" shall mean, if the Company's common stock is traded
------------- on a national stock exchange or quotation system, any days on which such exchange or quotation system is open for trading or, if the Company's common stock is not traded on a national stock exchange or quotation system, any days other than a Saturday, Sunday or a day on which banking institutions in the State of New York are authorized or obligated by law or executive order to close; provided, however, that "Business Days" shall not include any day on
-------- ------- which Executive is prohibited from selling the option shares which have vested pursuant to Section 4.3, as a result of securities laws restrictions or an agreement between Executive and the Company or an underwriter relating to restrictions on resale of the common stock, or as a result of any Company- imposed "black-out" period to comply with securities laws.


4.5 Other Benefit Plans. Subject to all eligibility requirements, and
------------------- to the extent permitted by law, the Executive shall be entitled to participate in any and all employee benefit plans (including, but not limited to, retirement, life insurance, medical, dental, disability, and savings plans) established or maintained by the Company from time to time for the benefit of their employees (or executives) in general.


4.6 Vacation. The Executive shall be entitled to four weeks paid
-------- vacation per annum.


4.7 Shareholder Rights. If, at any time, Imperial is granted "piggy-
------------------ back" registration rights with respect to its shares of the Company's common stock, Executive shall, at such time, be granted "piggy-back" registration rights similar to those granted to Imperial, subject to customary underwriters carve-backs and a carve-back in proportion to such shares sold by Imperial, if any. Executive shall have "tag-along" rights, on a proportionate basis, on any sales of Company shares by Imperial prior to consummation of an initial public offering by the Company.


5. Reasonable Expenses. The Company will reimburse the Executive for
------------------- all reasonable business expenses, including travel and lodging, which are properly incurred by him in the performance of his duties hereunder, upon presentation of proper vouchers therefor and in accordance with written policies established from time to time by the Company for such reimbursements.


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6. Assistance. Executive shall make himself reasonably available,
---------- upon the request of the Company, to testify or otherwise assist in litigation, arbitration, or other disputes involving the Company, or any of its officers, directors, employees, subsidiaries or affiliates, during the Employment Period and at reasonable times and locations following the termination of this Agreement.


7. Covenant Not to Compete.
-----------------------


7.1 General Covenant. During the Employment Period and for a period
---------------- of one year after the termination ...