Exhibit 10.19
 
 
                             CEO SEVERANCE AGREEMENT
 
 
     The  Committee  deems it advisable at this time to implement  the following
Severance Agreement. Should Executive's employment with the Company terminate by
reason of an Involuntary  Termination,  then Executive  shall become entitled to
receive the following special severance  benefits and option  acceleration under
this CEO Severance Agreement.  Under no circumstances,  however, shall Executive
be  entitled  to this CEO  Severance  Agreement  if  Executive's  employment  is
terminated for Cause or Change in Control.
 
 
     1. Severance
 
          a. Benefits
 
               (i) Severance  Payment.  Executive shall be entitled to receive a
          cash lump sum  severance  payment  in an  amount  equal to (A) one (1)
          times  the  annual  rate  of  Base  Salary  in  effect  for  Executive
          immediately before the Involuntary  Termination,  plus (B) Executive's
          Target  Bonus  for  the  calendar   year  in  which  the   Involuntary
          Termination  occurs if the Company is on target and provided Executive
          has  completed  six (6) months or more of the Business  Plan year.  If
          less than six (6) months completion occurs,  then he would be eligible
          for 50% of the Target Bonus.  The lump sum severance  payment shall be
          made thirty (30) days following Executive's termination date and shall
          be subject to the Company's  collection of all  applicable  income and
          employment withholding taxes.
 
               (ii)  Health  Care  Coverage.  The  Company  will make a lump sum
          payment  to  Executive  equal to twelve  (12)  months  of the  current
          monthly Internal Revenue Code Section 4980B medical premium  ("COBRA")
          for  Executive  and  Executive's  eligible  dependents.  This lump sum
          payment will be remitted to  Executive  thirty (30) days from the date
          of  Involuntary  Termination.  It  is  Executive's  responsibility  to
          complete the necessary  documents  and make  payments  directly to the
          COBRA administrator to maintain medical coverage throughout the peirod
          Executive are eligible for COBRA benefits.  Any additional health care
          coverage to which Executive and Executive's dependents may be entitled
          under COBRA will be at Executive's sole cost and expense.
 
               (iii) Life  Insurance  Coverage.  If  currently  enrolled  in the
          Company's Group Universal Life ("GUL") insurance program,  the Company
          will make a lump sum payment to Executive  equal to twelve (12) months
          of the current  monthly GUL insurance  premium.  This lump sum payment
          will be  remitted  to  Executive  thirty  (30)  days  from the date of
          Involuntary Termination.  It is Executive's responsibility to complete
          the  necessary  documents  and  make  payments  directly  to  the  GUL
          administrator to maintain coverage.
 
 
 
 
     2.   Option Acceleration
 
          a.   Monthly Acceleration - Stock Option Plan Grants
 
     Should there occur an Involuntary  Termination  of Executive's  employment,
then the Option,  to the extent  outstanding at the time but not otherwise fully
exercisable, shall automatically accelerate so that the Option shall immediately
become  exercisable  for a pro-rata  portion of the Option Shares.  The pro-rata
portion of the Option  Shares will be  calculated  by dividing the sum of months
since the last option vesting date to the date of Involuntary  Termination by 12
and  multiplying  that  result by the Option  Shares  that would have  otherwise
vested as of the next vesting date. The Option shall remain so exercisable until
the  lesser of (i) the  Expiration  Date of the  option or (ii) three (3) months
from the date of  Involuntary  Termination  or (iii) twelve (12) months from the
date of Death or Permanent Disability. However, no additional vesting will occur
and all remaining  unvested options will be cancelled on the date of Involuntary
Termination.
 
          b.   Monthly Acceleration- Non-plan Grants
 
     Should there occur an Involuntary  Termination  of Executive's  employment,
then the Option,  to the extent  outstanding at the time but not otherwise fully
exercisable, shall automatically accelerate so that the Option shall immediately
become  exercisable  for a pro-rata  portion of the Option Shares.  The pro-rata
portion of the Option  Shares will be  calculated  by dividing the sum of months
since the last option vesting date to the date of Involuntary  Termination by 12
and  multiplying  that  result by the Option  Shares  that would have  otherwise
vested as of the next vesting date. The Option shall remain so exercisable until
the  lesser of (i) the  Expiration  Date of the  option or (ii) three (3) months
from the date of  Involuntary  Termination  or (iii) twelve (12) months from the
date of Death or Permanent Disability. However, no additional vesting will occur
and all remaining  unvested options will be cancelled on the date of Involuntary
Termination.
 
 
     3.   Definitions
 
     For  purposes of this CEO  Severance  Agreement,  the  Committee  deems the
following definitions to apply.
 
          a.   Base  Salary  means the annual  rate of base salary in effect for
               the Executive.
 
          b.   Cause  means any of the  following  reasons for which the Company
               may terminate Executive's  employment hereunder:  (i) the willful
               failure or refusal by  Executive to perform his duties under this
               Agreement   (other  than  any  such   failure   attributable   to
               Executive's  incapacity due to physical or mental  illness) which
               is not cured within ten (10) business  days after written  notice
               from the Company in which there is identified the manner in which
               the Company  believes that the  Executive has not performed  such
 
                                       2
 
 
               duties  and  the  steps  required  to  cure  such  failure;  (ii)
               Executive's  conviction of, or entering a plea of nolo contendere
               with respect to, a felony;  (iii) any  intentional  misconduct by
               Executive which has a materially adverse effect upon the Company,
               monetarily  or  otherwise,   or  (iv)  any  unauthorized  use  or
               disclosure of the Company's proprietary information.
 
          c.   Executive means the Chief Executive Officer of the Company.
 
          d.   Involuntary  Termination  means the  involuntary  termination  of
               Executive's  employment  by the Company for any reason other than
               for  Cause  or  Change  In  Control.   However,   an  Involuntary
               Termination will not be deemed to occur in the event  Executive's
               employment  terminates  by  reason  of  his  Death  or  Permanent
               disability.
 
          e.   Target  Bonus  means  the  annual  incentive  bonus to which  the
               Executive may become  entitled under the Company's  Officer Bonus
               Plan for one or more calendar years upon the Company's attainment
               of the performance  milestones  designated for each such year and
               the Executive's  attainment of the personal objectives  specified
               for him for such year, if any.
 
 
     4.   Moving Expenses
 
     Should Executive elect to move back to the Seattle  Washington area, within
six (6)  months  from the date of  Involuntary  Termination,  the  Company  will
reimburse Executive up to $15,000 in connection with his moving expenses.
 
 
                                       3
 
 
                           CEO EXECUTIVE OFFICER GRANT
 
                                   ADDENDUM II
                                       TO
                             STOCK OPTION AGREEMENT
 
 
     The following  provisions are hereby incorporated into, and are hereby made
a part of, that certain Stock Option  Agreement(s)  (the "Option  Agreement") by
and  between  FileNET   Corporation  (the  "Corporation")  and  Lee  D.  Roberts
("Optionee")  identified in the attached Stock Option Personnel Summary and such
provisions  shall be  effective  immediately.  Each Stock  Option  Agreement  so
identified in attached Stock Option  Personnel  Summary shall be herein referred
to as an "Option  Agreement," and each stock option  evidenced by such an Option
Agreement  shall be herein  referred  to as an  "Option"  under the terms of the
Corporation's  1995 Stock Option Plan,  and such  provisions  shall be effective
concurrently with the date of grant of the Option. All capitalized terms in this
Addendum,  to the extent not otherwise  defined herein,  shall have the meanings
assigned to them in the Option Agreement.
 
 
                             INVOLUNTARY TERMINATION
 
     1. Should there occur an  Involuntary  Termination  of Optionee's  Service,
then the Option,  to the extent  outstanding at the time but not otherwise fully
exercisable, shall automatically accelerate so that the Option shall immediately
become  exercisable  for a pro-rata  portion of the Option Shares.  The pro-rata
portion of the Option  Shares  will be  calculated  by  dividing  the sum of the
months since the last option vesting date to the date of Involuntary Termination
by 12 and multiplying that result by the Option Shares that would have otherwise
vested as of the next vesting date. The Option shall remain so exercisable until
the lesser of (i)  Expiration  Date of the option or (ii) three (3) months  from
the date of Involuntary Termination or (iii) twelve (12) months from the date of
Death or Permanent Disability. However, no additional vesting will occur and all
remaining  unvested  options  will  be  cancelled  on the  date  of  Involuntary
Termination.
 
     2. For purposes of this  Addendum,  the following  definitions  shall be in
effect:
 
     -    An  Involuntary  Termination  means  the  involuntary  termination  of
          Executive's  employment  by the Company for any reason  other than for
          Cause or Change In Control.  However, an Involuntary  Termination will
          not be deemed to occur in the event Executive's  employment terminates
          by reason of his Death or Permanent disability..
 
     -    Cause  means any of the  following  reasons  for which the Company may
          terminate Executive's employment hereunder: (i) the willful failure or
          refusal by Executive to perform his duties under this Agreement (other
          than any such failure  attributable  to Executive's  incapacity due to
          physical  or  mental  illness)  which  is not  cured  within  ten (10)
 
                                       4
 
 
          business days after written  notice from the Company in which there is
          identified the manner in which the Company believes that the Executive
          has not  performed  such  duties and the steps  required  to cure such
          failure;  (ii)  Executive's  conviction of, or entering a plea of nolo
          contendere with respect to, a felony; (iii) any intentional misconduct
          by Executive  which has a materially  adverse effect upon the Company,
          monetarily or otherwise, or (iv) any unauthorized use or disclosure of
          the Company's proprietary information.
 
     3. The  provisions of Paragraphs 1 and 2 of this Addendum  shall govern the
period for which the Option is to remain  exercisable  following the Involuntary
Termination  of Optionee's  Service and shall  supersede  any  provisions to the
contrary in the Option Agreement.
 
     4. In the event the Option is designated  an Incentive  Option in the Grant
Notice, then the following terms and conditions shall also apply to the Option:
 
     A.   The Option shall cease to qualify for  favorable  tax  treatment as an
          Incentive  Option if (and to the extent) the Option is  exercised  for
          one or more Option  Shares:  (i) more than three (3) months  after the
          date Optionee ceases to be an Employee for any reason other than Death
          or Permanent Disability or (ii) more than twelve (12) months after the
          date Optionee ceases to be an Employee by reason of Death or Permanent
          Disability.
 
     B.   Should the Option be accelerated, in accordance with the terms of this
          Addendum,  upon an  Involuntary  Termination,  then the  Option  shall
          qualify for favorable tax treatment as an Incentive Option only to the
          extent the aggregate Fair Market Value  (determined at the Grant Date)
          of the Common Stock for which the Option first becomes  exercisable in
          the calendar year in which such  Involuntary  Termination  occurs does
          not,  when  added  to  the  aggregate  value  (determined  as  of  the
          respective  date or  dates  of  grant)  of the  Common  Stock or other
          securities for which the Option or one or more other Incentive Options
          granted to Optionee prior to the Grant Date (whether under the Plan or
          any other option plan of the  Corporation or any Parent or Subsidiary)
          first become  exercisable  during the same calendar  year,  exceed One
          Hundred  Thousand  Dollars  ($100,000)  in the  aggregate.  Should the
          applicable  One  Hundred  Thousand  Dollar  ($100,000)  limitation  be
          exceeded in the calendar  year of such  Involuntary  Termination,  the
          Option may  nevertheless  be exercised  for the excess  shares in such
          calendar year as a Non-Qualified Option.
 
                                       5
 
 
     IN WITNESS  WHEREOF,  FileNET  Corporation  has caused this  Addendum to be
executed  by its duly  authorized  officer as of the  Effective  Date  specified
below.
 
                             FILENET CORPORATION
 
 
 
                             By:      ________________________________________
                                      Sam M. Auriemma
                             Title:   Senior Vice President,
                                      Chief Financial Officer
 
 
EFFECTIVE DATE: ________________________
 
 
 
                                       6
 
 
 
                                                                    Exhibit 31.1
 
      Certification of Chief Executive Officer Pursuant to Section 302 of
                         the Sarbanes-Oxley Act of 2002
 
 
I, Lee D. Roberts, certify that:
 
     1.  I  have  reviewed  this  quarterly  report  on  Form  10-Q  of  FileNet
Corporation;
 
     2. Based on my knowledge, this report does not contain any untrue statement
of a  material  fact or omit to  state a  material  fact  necessary  to make the
statements made, in light of the circumstances  under which such statements were
made, not misleading with respect to the period covered by this report;
 
     3. Based on my knowledge,  the financial  statements,  and other  financial
information included in this report, fairly present in all material respects the
financial  condition,  results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;
 
 
     4. The  registrant's  other  certifying  officer and I are  responsible for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
 
 
          a) designed such disclosure  controls and  procedures,  or caused such
     disclosure controls and procedures to be designed under our supervision, to
     ensure that material information relating to the registrant,  including its
     consolidated  subsidiaries,  is made  known to us by  others  within  those
     entities,  particularly  during the  period in which  this  report is being
     prepared;
 
 
          b) evaluated the effectiveness of the registrant's disclosure controls
     and  procedures  and  presented  in this report our  conclusions  about the
     effectiveness of the disclosure  controls and procedures,  as of the end of
     the period covered by this report based on such evaluation; and
 
 
          c)  disclosed in this report any change in the  registrant's  internal
     control over financial reporting that occurred during the registrant's most
     recent fiscal quarter (the  registrant's  fourth fiscal quarter in the case
     of an annual report) that has materially affected,  or is reasonably likely
     to materially  affect,  the  registrant's  internal  control over financial
     reporting; and
 
 
     5. The registrant's other certifying officer and I have disclosed, based on
our most recent evaluation of internal control over financial reporting,  to the
registrant's  auditors  and the audit  committee  of the  registrant's  board of
directors (or persons performing the equivalent functions):
 
 
          a) all significant  deficiencies and material weaknesses in the design
     or  operation  of  internal  control  over  financial  reporting  which are
     reasonably  likely to adversely affect the registrant's  ability to record,
     process, summarize and report financial information; and
 
 
          b) any fraud,  whether or not material,  that  involves  management or
     other employees who have a significant  role in the  registrant's  internal
     control over financial reporting.
 
 
Date:    August 13, 2003