EXHIBIT 10.1
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MANAGEMENT TRANSITION AGREEMENT
This Management
Transition Agreement (the "Agreement") is made as of
February 1, 2005, by and between Alan R.
MacDougall, (the "Employee") and
Datawatch Corporation (the "Company"). This
Agreement supersedes the Severance
Agreement dated April 25, 2002 by and
between the Company and Alan R.
MacDougall.
WHEREAS, the
Company desires to continue to employ the Employee in a
part-time capacity for a period ending on
July 31, 2005 to assist the Company's
incoming Chief Financial Officer ("CFO") in
transitioning to the role of CFO for
the Company and to advise the CFO on such
matters as he determines, including,
but not limited to, SEC rules, regulations,
filings, and compliance; investor
relations, banking facilities, contract
status, and general business advice; and
the Employee desires to be employed by the
Company on the terms specified
herein;
NOW, THEREFORE,
in consideration of the foregoing and the agreements herein
contained, and intending to be legally
bound, the parties hereby agree as
follows:
1. Position and
Responsibilities. The Employee agrees to serve as Advisor
to the CFO of the Company. The Employee
agrees to make himself reasonably
available on an as needed basis to advise
and assist the CFO in his transition
to the position of CFO for the Company. The
Employee shall report to, and his
activities shall be subject to the
reasonable direction and control of the
Company's CFO, and the Employee shall
exercise such powers and comply with and
perform, faithfully and to the best of his
ability, such directions and duties
in relation to his position as Advisor to
the CFO as may from time to time be
reasonably vested in or requested of
him.
2. Resignation
of Officer and Directors Positions. The Employee has
resigned as of January 10, 2005, from any
and all officer and director positions
with the Company.
3. Term. The
parties agree that the Employee's employment with the Company,
under this Agreement, shall end on July 31,
2005 (the "Termination Date").
4. Compensation
and Benefits. As compensation for the satisfactory
performance by the Employee of his duties
and obligations hereunder to the
Company and subject to the provisions of
Section 5, the Employee shall receive:
4.1. Base Salary. The Employee's salary shall be paid at a rate
of
$12,500.00 per month (the "Base Salary") up
until March 31, 2005. Effective
April 1, 2005, the Employee will receive
payment of accrued unused vacation time
at the rate of $4,327.00 per month with the
last payment being July 31, 2005.
The Base Salary shall be payable in
accordance with the customary payroll
practices of the Company as may be
established or modified from time to time.
All payments shall be subject to all
applicable federal, state and/or local
payroll and withholding taxes.
4.2. Benefits. During Employee's employment, and subject to any
contribution generally required of
employees of the Company, the Employee shall
be eligible to participate in all employee
health and benefits plans, to the
extent permitted under the terms of the
plans, as may be from time to time
adopted by the Company and in effect for
employees of the Company in similar
positions. Employee's participation shall
be subject to (i) the terms of the
applicable plan documents, (ii) generally
applicable Company policies, and (iii)
the discretion of the Board or any
administrative or other committee provided
for in, or contemplated by, such plan.
Notwithstanding the above, the Company
may not alter its policies or take any
action during the term of this Agreement
which is designed to affect Employee's
rights only (and not those of other
employees of the Company) to participate in
the employee health and benefit
plans, except as otherwise required due to
a change in governing law or
regulation.
The Company's
plans and policies shall govern all other benefits. The
Company may alter, modify, add to, or
delete its employee benefits plans and
policies, at any time, as the Company, in
its sole judgment, determines to be
appropriate. The Employee's medical and
dental insurance coverage under the
Company's group health plan is scheduled to
terminate on July 31, 2005 - the
date of the "qualifying event" under the
Consolidated Omnibus Budget
Reconciliation Act of 1985 ("COBRA").
Beginning on
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August 1, 2005, if elected by the Employee,
the Company will pay both the
employer and employee portions of COBRA
premium payments for medical and dental
coverage for a period of five (5) months
ending December 31, 2005. The employee
has the right to continue COBRA coverage,
at his own expense, for an additional
13 months. Such benefits may be continued
but only to the extent that Employee
makes timely premium payments for such
continuation of benefits.
Notwithstanding
the above, the Employee will not be eligible for any
bonuses, stock options (other than as
previously granted), or accrual of any
vacation time under this Agreement. The
parties agree that through July 31,
2005, Employee's stock options, as
previously granted, shall continue to vest in
accordance with the vesting schedules set
forth in Employee's Incentive Stock
Option Agreements dated July 23, 2003 and
November 21, 2003. All other of the
Employee's Incentive Stock Option
Agreements dated May 1, 1997, December 11,
1997, May 3, 1999, July 15, 1999, December
11, 2000, November 19, 2001 and March
8, 2002 are fully vested. Employee's rights
to exercise such stock options shall
remain subject to the terms and conditions
of the Datawatch Corporation 1996
Stock Option Plan and the above-referenced
Incentive Stock Option Agreements. It
being agreed, for purposes of this
agreement, that
