EXHIBIT 10.7
EMPLOYMENT AGREEMENT
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This Employment Agreement is dated as of January 1, 1995, by and between
Xxx Charter ("Employee") and VISUAL NUMERICS, INC. ("Company").
BACKGROUND:
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WHEREAS, the Company and Employee mutually desire to enter into an
Employment Agreement which will supersede existing agreements with respect to
Employee's employment.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, the Company and Employee agree as follows:
1. Term of Agreement. This Agreement shall commence on the date hereof and
may be terminated by either party, with or without cause, on thirty (30) days
written notice to the other party.
2. Duties. Employee shall be employed as Executive Vice President, European
Operations. A general description of Employee's current duties is attached
hereto as Exhibit A. Employee acknowledges that the Company may change the
description of such duties from time to time.
3. At-Will Employment. The Company and the Employee acknowledge that
Employee's employment is and shall continue to be at-will, as defined under
applicable law. If the Employee's employment terminates for any reason, the
Employee shall not be entitled to any payments, benefits, damages, award or
compensation other than as provided in this Agreement, or as may otherwise be
available in accordance with the Company's established written plans and written
policies at the time of termination.
4. Compensation. For the duties and services to be performed by Employee
hereunder, the Company shall pay Employee, and Employee agrees to accept, the
salary, stock options, bonuses and other benefits described below in this
Section 4.
(a) Salary. Employee shall receive a base salary of $194,295 per
annum, payable twice monthly in equal installments (or at such other times as
the other executive officers of the Company are paid or applicable local law
requires), in accordance with the Company's normal payroll practices. The base
salary shall be reviewed at least annually by the Board, its Compensation
Committee or the Chief Executive Officer of the Company, and any increases will
be effective as of the date determined appropriate by the Board, its
Compensation Committee or the Chief Executive Officer.
(b) Stock Options and Other Incentive Programs. Employee shall be
eligible to participate in any stock option or other incentive programs
available to officers or employees of the Company.
(c) Bonuses. Employee shall participate in and, to the extent earned
or otherwise payable thereunder, receive periodic incentive cash bonuses
pursuant to the incentive
bonus programs currently maintained or hereafter established by the Company for
its executives generally. Employee's entitlement to incentive bonuses is
discretionary and shall be determined by the Board, its Compensation Committee
or the Chief Executive Officer of the Company in good faith based upon the
extent to which Employee's individual performance objectives and the Company's
profitability objectives and other financial and nonfinancial objectives were
achieved during the applicable bonus period. The criteria for Employee's bonus
eligibility for fiscal year 1995 are set forth in Exhibit B, attached hereto. In
the event of Employee's death or disability during the term of this Agreement,
the Company shall pay to Employee or Employee's estate the bonus Employee would
have earned during the entire year in which death or disability occurred.
(d) Healthcare. During the term of this Agreement, Employee shall be
eligible to participate in any health insurance programs available to officers
or employees of the Company.
(e) Insurance. During the term of Employee's employment, Employee
shall be eligible to participate in any life or disability insurance programs
available to officers or employees of the Company.
(f) Vacation and Sick Pay. Employee shall be eligible for vacation and
sick leave in accordance with the policies of the Company in effect from time to
time during the term of this Agreement. All accrued vacation pay shall be paid
to Employee in a lump sum payment on the date of retirement or termination of
employment with the Company.
5. Severance Benefits.
(a) Change of Control; Stock Options. Upon the occurrence of a Change
of Control, notwithstanding any other plan or agreement to the contrary, vesting
of all outstanding stock options, restricted stock and other long-term incentive
compensation awards held by Employee shall be accelerated such that all options,
restricted stock and other long-term incentive compensation awards shall be
fully exercisable or otherwise vested effective as of the date of such Change of
Control and any such options shall remain exercisable until the earlier to occur
of (i) two years from the date of the Change of Control or (ii) the original
expiration date of such option.
(b) Termination of Employment. In the event Employee's employment
terminates for any reason, either prior to or after the occurrence of a Change
of Control, then Employee shall be entitled to receive severance benefits as
follows:
(i) Voluntary Resignation. If Employee's employment terminates by
reason of Employee's voluntary resignation (and is not an Involuntary
Termination or a Termination for Cause), then Employee shall not be entitled to
receive severance payments. Employee's benefits will be continued under the
Company's then existing benefit plans and policies in accordance with such plans
and policies in effect on the date of termination and in accordance with the
terms of this Agreement.
(ii) Involuntary Termination. If Employee's employment is
terminated as a result of Involuntary Termination other than for Cause, Employee
will be entitled to receive
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severance payments equal to the greater of Employee's regular monthly salary for
six (6) months (the "Severance Period") or the benefit set forth in the
Company's severance policy in effect at the time of Employee's termination. Such
payments shall be made ratably over the Severance Period according to the
Company's standard payroll schedule. Health insurance benefits including the
same coverages provided to Employee prior to the termination (e.g. medical,
dental, optical, mental health) and in all other respects significantly
comparable to those in place immediately prior to the termination will be
provided at the Company's cost until six months after the date of termination.
Life insurance providing the same dollar amount of coverage and in all other
respects significantly comparable to that in place immediately prior to the
termination will be provided at the Company's cost until six months after the
date of termination, or as otherwise agreed to by Employee and the Company.
Notwithstanding any other plan or agreement to the contrary, vesting of all
outstanding stock options, restricted stock and other long-term incentive
compensation awards held by Employee shall be accelerated such that all options,
restricted stock and other long-term incentive compensation awards shall be
fully exercisable or otherwise vested effective as of the date of termination
and any such options shall remain exercisable until the earlier to occur of (A)
six months after the date of termination or (B) the original expiration date of
such option. If Employee is working for the Company outside the United States at
the time of Employee's termination, the Company shall pay the normal and
reasonable costs incurred by Employee in re-entering the United States. In
addition, Employee will be entitled to receive reimbursement for all necessary
and reasonable expenses, which must be documented, incurred in connection with
moving himself and his personal possessions back to his home in the United
States from his then-current foreign assignment.
(iii) Involuntary Termination for Cause. If Employee's employment
is terminated for Cause, then Employee shall not be entitled to receive
severance payments. Employee's benefits will be continued under the Company's
then existing benefit plans and policies in accordance with such plans and
policies in effect on the date of termination and in accordance with the terms
of this Agreement. If Employee is working for the Company outside the United
States at the time of Employee's termination, the Company shall pay the normal
and reasonable costs incurred by Employee in re-entering the United States. In
addition, Employee will be entitled to receive reimbursement for all necessary
and reasonable expenses, which must be documented, incurred in connection with
moving himself and his personal possessions back to his home in the United
States from his then-current foreign assignment.
6. Definition of Terms. The following terms referred to in this Agreement
shall have the following meanings.
(a) Change of Control. "Change of Control" shall mean the occurrence of
any of the following events:
(i) Ownership. Any "person" (as such term is used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended) is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing fifty-one percent (51%) or
more of the total voting power represented by the Company's then outstanding
voting securities; or
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(ii) Composition of Board. A change in the composition of the
Board of Directors of the Company, as a result of which fewer than a majority of
the directors are Incumbent Directors. "Incumbent Directors" shall mean
directors who either (A) are directors of the Company as of the date hereof, or
(B) are elected, or nominated for election, to the Board of Directors of the
Company with the affirmative votes of at least a majority of the Incumbent
Directors at the time of such election or nomination (but shall not include an
individual whose election or nomination is in connection with an actual or
threatened proxy contest relating to the election of directors to the Company);
or
(iii) Merger/Sale of Assets. The stockholders of the Company
approve a merger or consolidation of the Company with any other corporation,
other than a merger or consolidation which would result in the voting securities
of the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or the stockholders
of the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or substantially all
of the Company's assets.
(iv) Death of Xxxxxxx X. Xxxxxxx and Xxxxxxxx X. Xxxxxxx. The death
of Xxxxxxx X. Xxxxxxx and Xxxxxxxx X. Xxxxxxx (collectively "the Johnsons") at a
time when the Johnsons own a majority of the total voting power represented by
the Company's then outstanding voting securities. For purposes of this
provision, the term death shall include the disability of the Johnsons which
results in transfer of control of the total voting power represented by the
Company's then outstanding voting securities held by the Johnsons at the time of
such disability to a guardian or a trustee.
(b) Cause. "Cause" shall mean gross negligence or willful misconduct
where such gross negligence or willful misconduct has resulted or is likely to
result in substantial and material damage to the Company or its subsidiaries.
Anything contained in this Section 6(b) to the contrary notwithstanding,
Employee shall not be deemed to have been terminated for Cause unless and until
there shall have been delivered to Employee a copy of a resolution duly adopted
by the Board of Directors of the Company, after reasonable notice to Employee
and an opportunity for Employee, together with Employee's counsel, to be heard
before the Board, finding that in the good faith opinion of the Board, Employee
has engaged in the conduct described in this Section 6(b).
(c) Current Compensation. "Current Compensation" shall mean an amount
equal to the greater of (A) Employee's highest annual base salary for the year
preceding the year in which the termination occurs, or (B) Employee's annual
base salary at any time during the year in which the termination occurs.
7. Excise Tax Payments. If an excise tax is imposed pursuant to Section
4999 of the Internal Revenue Code of 1986 or any corresponding provision of
state income tax law on any payments or benefits received by Employee under any
provision of this Agreement (other than this Section 7), the Company will pay
Employee an additional amount equal to the amount of such
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tax, plus any interest, penalties or additions to tax which may be imposed with
respect thereto. Employee will not be entitled to receive any payment with
respect to any such excise tax which may be imposed on payments received under
this Section 7.
8. Successors. Any successor to the Company (whether direct or indirect
and whether by purchase, lease, merger, consolidation, liquidation or otherwise)
to all or substantially all of the Company's business and/or assets shall assume
the obligations under this Agreement and agree expressly to perform the
obligations under this Agreement in the same manner and to the same extent as
the Company would be required to perform such obligations in the absence of a
succession. The terms of this Agreement and all of Employee's rights hereunder
shall inure to the benefit of, and be enforceable by, Employee's personal or
legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
9. Notice. Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by U.S. registered or certified mail, return
receipt requested and postage prepaid. Mailed notices to Employee shall be
addressed to Employee at the home address from which Employee most recently
communicated to the Company in writing. In the case of the Company, mailed
notices shall be addressed to its company headquarters in Houston, Texas, and
all notices shall be directed to the attention of its Secretary.
10. Miscellaneous Provisions.
(a) No Duty to Mitigate. Employee shall not be required to mitigate
the amount of any payment contemplated by this Agreement (whether by seeking new
employment or in any other manner), nor shall any such payment be reduced by any
earnings that Employee may receive from any other source.
(b) Waivers, etc. No amendment of this Agreement and no waiver of any
one or more of the provisions hereof shall be effective unless set forth in
writing by such person against whom enforcement is sought.
(c) Sole Agreement. This Agreement, including the Exhibits hereto
constitutes the sole agreement of the parties and supersedes all oral
negotiations and prior writings with respect to the subject matter hereof.
(d) Choice of Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Texas.
(e) Severability. If any term or provision of this Agreement or the
application thereof to any circumstance shall, in any jurisdiction and to any
extent, be invalid or unenforceable, such term or provision shall be ineffective
as to such jurisdiction to the extent of such invalidity or unenforceability
without invalidating or rendering unenforceable the remaining terms and
provisions of this Agreement or the application of such terms and provisions to
circumstances other than those as to which it is held invalid or unenforceable,
and a suitable and
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equitable term or provision shall be substituted therefor to carry out, insofar
as may be valid and enforceable, the intent and purpose of the invalid or
unenforceable term or provision.
(f) Legal Fees and Expenses. The Company shall reimburse Employee for
all reasonable professional fees and expenses as incurred by Employee in
connection with negotiating and executing this Agreement. In the event an
action is brought to enforce any provision of this Agreement, Employee's legal
fees and expenses shall be paid by the Company as incurred by Employee, unless
Employee brings a claim which is determined by the arbitrator or court, as the
case may be, to be frivolous, in which case, Employee shall repay the Company
all amounts advanced by the Company to Employee in connection with such claim
within thirty days of such determination.
(g) Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together will
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have executed this Agreement the date first
above written.
"Company"
VISUAL NUMERICS, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx,
President and Chief Executive Officer
"Employee"
/s/ Xxx Charter
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Xxx Charter
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EXHIBIT A
DESCRIPTION OF DUTIES
EXHIBIT B
FISCAL YEAR 1995 BONUS CRITERIA
To be determined by February 1, 1995.
