EMPLOYMENT
AGREEMENT
This Employment Agreement (this
“ Agreement ”), dated as of August 25, 2005, is
entered into between Viewpoint Corporation, a Delaware Corporation
with its principal office at 498 Seventh Avenue, New York, N.Y.
10018 (“ Viewpoint ”), and Patrick Vogt (“
Executive ”).
WHEREAS, Viewpoint desires to retain
Executive’s services as President and Chief Executive
Officer, and Executive desires to be retained by Viewpoint to serve
as President and Chief Executive Officer of Viewpoint.
NOW THEREFORE, for good and valuable
consideration, the sufficiency of which is hereby acknowledged by
the parties, the parties hereto hereby agree as follows:
1. Employment; Term
.
(a) Duties and
Responsibilities . Subject to the terms and conditions of this
Agreement, Viewpoint hereby employs Executive, and Executive hereby
accepts employment with Viewpoint, as President and Chief Executive
Officer. Executive shall devote his full business time and
attention to the business and affairs of Viewpoint and its
subsidiaries. Executive shall observe and comply with
Viewpoint’s policies, rules and regulations regarding the
performance of his duties, shall use his best efforts, skills and
abilities to promote Viewpoint’s interests and shall perform
his duties faithfully, competently and in such manner as
Viewpoint’s Board of Directors (the “ Board
”) may from time to time reasonably direct.
(b) Duty of Loyalty .
Executive will execute the “ Duty of Loyalty Agreement
” that is annexed hereto as Exhibit A and is made a
part of this Agreement.
(c) Principal Place of
Employment . Executive’s principal place of employment
shall be at Viewpoint’s headquarters in New York, New York,
or at such other location as shall be mutually acceptable to
Executive and the Board.
(d) Representations .
Executive affirms and represents that he is under no obligation to
any former employer or other party which is in any way inconsistent
with, or which imposes any restriction upon, Executive’s
acceptance of employment hereunder, the employment of Executive by
Viewpoint, or Executive’s undertakings under this
Agreement.
(e) Executive’s employment
hereunder shall commence on August 25, 2005 (the “
Commencement Date ”), and terminate at 11:59 p.m. on
December 31, 2009, unless terminated earlier pursuant to Section
3 below (the “ Term of Employment
”).
2. Compensation and Benefits
. Viewpoint shall pay the following compensation and provide the
following benefits to Executive during the Term of
Employment:
(a) Base Salary . Executive
shall receive a base salary of $350,000 per annum (the “
Base Salary ”), payable in approximately equal
installments in accordance with the
Page 1 of 9
customary payroll practices of
Viewpoint. If the rate of Base Salary per annum paid to Executive
is increased during the Term of Employment, such increased rate
shall thereafter constitute the Base Salary for all purposes of
this Agreement. Executive’s Base Salary shall not be
decreased during the Term of Employment without the mutual consent
of Executive and Company.
(b) Signing Bonus . Viewpoint
shall pay to Executive a one-time bonus of $50,000 on the date this
Agreement is executed by Executive.
(c) Bonus Compensation
.
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(i)
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Annual Cash Incentive Bonus
. Executive shall be eligible to
receive an annual cash incentive bonus of $128,000 if the Committee
(as defined below) determines in good faith that Viewpoint achieves
annual Revenue Growth and Operating Income targets during the Term
of Employment, starting with the 2006 fiscal year. The annual
Revenue Growth and Operating Income targets shall be set by the
Compensation Committee of the Board (the “ Committee
”) after consultation with the Executive.
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(ii)
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Annual Incentive Option Bonus
. Executive shall be eligible to
receive an annual incentive option grant to acquire 125,000 shares
of Viewpoint common stock if the Committee determines in good faith
that Viewpoint achieves annual Revenue Growth and Operating Income
targets during the Term of Employment, starting with the 2006
fiscal year. The annual Revenue Growth and Operating Income targets
shall be set by the Compensation Committee of the Board after
consultation with the Executive. Any options granted pursuant to
this Section 2(c)(ii) will be subject to the terms of
Viewpoint’s 1996 Nonstatutory Stock Option Plan.
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(iii)
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For purposes of this Section 2(c)(i) and
(ii) , “ Operating Income ” means earnings
per share calculated before interest, depreciation, amortization,
non-cash stock-based compensation charges, and impairment of
goodwill and other intangible assets but after accrual for
performance-based any bonus(es) described in this Section
2(c) .
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(d) Option to Acquire
Viewpoint Common Stock . Viewpoint will grant to Executive an
option to acquire 1,500,000 shares of Viewpoint common stock (the
“ Option ”) at an exercise price equal to the
opening price of Viewpoint’s common stock on the Commencement
Date. The Option shall vest in accordance with the following
schedule, if Executive is employed by the Company on the applicable
date(s) set forth below:
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Vesting Date
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Shares to Vest
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Commencement Date
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33 1 / 3 %
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December 31, 2006
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16 2 / 3 %
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December 31, 2007
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16 2 / 3 %
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December 31, 2008
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16 2 / 3 %
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December 31, 2009
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16 2 / 3 %
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The Option will be subject to the
terms of an award agreement to be executed by Viewpoint and
Executive.
(e) Life Insurance . During
the Term of Employment, Viewpoint will reimburse Executive for the
cost of premiums (as determined on the Commencement Date) for a
term life insurance policy with a death benefit of $5,000,000
payable to Executive’s beneficiaries. This amount shall be
reimbursed in equal monthly installments during the Term of
Employment.
(f) Housing Allowance .
Viewpoint will reimburse Executive for his reasonable expenses
associated with a housing allowance in the form of rent or a
mortgage subsidy in the New York City metropolitan area in an
amount of $3,000 per month during the Term of Employment, but only
up to a maximum of twenty-four (24) months, payable in
approximately equal installments in accordance with the customary
payroll practices of Viewpoint.
(g) Benefit Plans; Vacation.
Executive shall be entitled to participate in all benefit plans
maintained for Viewpoint employees and shall be entitled to four
(4) weeks of paid vacation per annum to be accrued and used in
accordance with Viewpoint’s policies.
(h) Withholdings and
Deductions . The payment of any Base Salary, bonus or other
compensation hereunder shall be subject to income tax, social
security and other applicable withholdings, as well as such
deductions as may be required under Viewpoint’s employee
benefit plans.
(i) Disability Insurance.
During the Term of Employment, Viewpoint will provide, or reimburse
Executive for premiums paid to acquire, a long-term disability
insurance policy which will provide benefits for a qualifying
disability of sixty percent (60%) of Executive’s last
pre-disability Base Salary, on an after tax basis, for the entire
period of Executive’s disability for a maximum period ending
on Executive’s sixty-fifth (65 th ) birthday;
provided , however , that if the foregoing disability
insurance does not result in the payment of monthly disability
benefits that are greater than or equal to Executive’s
monthly Base Salary on an after tax basis, Viewpoint shall pay
Executive a monthly sum representing the difference between the two
amounts, which monthly payments shall continue until the earlier of
the date disability benefits cease and the date that is twenty-four
(24) months following the date the first such payment is
made.
(j) Indemnification.
Viewpoint shall defend, indemnify and hold Executive harmless, to
the fullest extent permitted by law and by Viewpoint’s
by-laws, against all claims that arise from or out of, or are
related to Executive’s actions or inactions while employed
with Viewpoint (including attorneys’ fees, judgments, fines,
defense costs and amounts paid in any settlement). For the
avoidance of doubt, the foregoing indemnification will be provided
with respect to all times during which Executive served as a
director or officer of Viewpoint, regardless of whether any claim
covered by this Section 2(j) is asserted during the Term of
Employment or after Executive’s employment ceases.
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3. Termination; Severance; Change
in Control .
(a) Termination Without Cause or
With Good Reason . If, at any time during the Term of
Employment, Executive’s employment is terminated by Viewpoint
without Cause (as defined below), or if Executive terminates his
employment with Viewpoint for Good Reason (as defined
below),
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(i)
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Viewpoint will pay to Executive an amount equal
to one (1) times Executive’s then current Base Salary, which
shall be payable in a lump sum, and
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(ii)
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One hundred percent (100%) of the vested portion
of the Option and all other vested options, if any, granted to
Executive during the Term of Employment, will remain exe
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