QuickLinks -- Click here to rapidly navigate through this document

EXHIBIT 10.26

EMPLOYMENT AGREEMENT

        This Employment Agreement (this "Agreement") is made and entered into as
of October 11, 2001, by and between DuPont Photomasks, Inc., a Delaware
corporation (the "Company"), and Satish Rishi, an individual ("Executive").

RECITALS

        WHEREAS, the Company desires to hire Executive and Executive desires to
become employed by the Company; and

        WHEREAS, the Company and Executive have determined that it is in their
respective best interest to enter into this Agreement on the terms and
conditions as set forth herein.

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

AGREEMENT

1.    EMPLOYMENT TERMS AND DUTIES

        1.1    Employment.    The Company hereby employs Executive, and
Executive hereby accepts employment by the Company, upon the terms and
conditions set forth in this Agreement.

        1.2    Duties.    Executive shall serve as Executive Vice President and
Chief Financial Officer of the Company and shall report solely to the Chief
Executive Officer of the Company (CEO). Executive shall have the authority, and
perform the duties customarily associated with his titles together with such
additional duties of a senior executive nature and commensurate with his titles
as may from time to time be assigned by the Company. Executive shall devote his
full working time and efforts to the performance of his duties and the
furtherance of the legitimate business interests of the Company and shall not be
otherwise employed. Executive may also serve as a director or trustee of other
organizations, or engage in charitable, civic and/or governmental activities
provided that such service and activities do not prevent Executive from
performing the duties required of Executive under this Agreement and further
provided that Executive obtains written consent for all such activities from the
Company. Executive will agree to serve on the Company's Board of Directors if
asked to do so by the Company and the Board.

        1.3    Term.    Subject to the provisions of Section 1.6 below, the term
of employment of Executive under this Agreement shall commence on November 5,
2001, (the "Hire Date") and shall continue for a period of 3 years (the "Initial
Term"). This Agreement, and Executive's employment hereunder, may be terminated
if the Company provides Executive, or Executive provides the Company, with
written notice of termination at least 3 months prior to the end of the Initial
Term. If neither party elects to terminate prior to completion of the Initial
Term, this Agreement shall automatically renew (the "Renewal Term" and together
with the Initial Term, the "Employment Term") and may only be terminated under
Section 1.6.

        1.4    Compensation and Benefits.    

        1.4.1    Base Salary.    In consideration of the services rendered to
the Company hereunder by Executive and Executive's covenants hereunder and in
the Company's Confidentiality, Proprietary Information and Inventions Agreement
(the "Confidentiality Agreement", attached hereto as Annex A), the Company
shall, during the Employment Term, pay Executive a salary at the annual rate of
$235,000 (the "Base Salary"), less statutory deductions and withholdings,
payable in equal installments in accordance with the Company's regular payroll
practices, but no less frequently

--------------------------------------------------------------------------------

than monthly. The initial annual base salary may be increased from time to time
in the sole discretion of the Company.

        1.4.2    The Incentive Compensation.    Pursuant to the Company's
standard bonus plan, Executive will be entitled to an annual target bonus
opportunity of roughly forty-five percent (45%) of Base Salary (the "Incentive
Compensation"). However, the actual Incentive Compensation payable to Executive
will be based upon Executive's performance and the size of the bonus pool as
determined by the Board of Directors. These factors may change the range of the
Incentive Compensation amount by increasing it to over hundred percent (100%) of
Base Salary or decreasing it to zero percent (0%). The Incentive Compensation
will be paid each year after the close of the fiscal year, per the normal
Company schedule.

        1.4.3    Benefits Package.    In addition to the Base Salary, during the
Employment Term, Executive shall receive such employee benefits and holidays as
may be in effect from time to time as are afforded to other senior executives of
the Company.

        1.4.4    Vacation.    Executive shall be entitled to four (4) weeks'
paid vacation each year of the Employment Term.

        1.4.5    Expenses.    The Company shall, upon receipt from Executive of
supporting receipts to the extent required by applicable income tax regulations
and the Company's reimbursement policies, reimburse Executive for all
out-of-pocket business expenses reasonably incurred by Executive in connection
with his employment hereunder, as approved by the Company.

        1.5    Stock Options.    

        1.5.1    Initial Stock Option.    Effective as of the Hire Date, the
Company shall grant to Executive, in accordance with the terms of the Company's
Amended 1997 Stock Option and Restricted Stock Plan (the "Plan") an option to
purchase a total of 50,000 shares of the Company's common stock, par value $0.01
per share (the "Common Stock"), at an exercise price equal to the average of the
high selling price and the low selling price of the Common Stock on the Hire
Date. The option shall vest twenty-five percent (25%) per year on the first
anniversary and each of the next three anniversaries of the Hire Date.

        The Initial Options will be designated incentive stock options to the
maximum extent allowed by law and will expire if not exercised within ten
(10) years of the date of grant, and shall be granted pursuant to option
agreements in the form annexed hereto as Annex B.

        Also Executive shall be granted from the Plan an option to purchase a
total of 7,500 shares of stock with a grant date effective as of July 5, 2002.
These options shall vest as follows: 2,500 shares on July 5, 2003, 2,500 shares
on July 2, 2004 and 2,500 shares on July 5, 2005.

        Lastly, Executive shall be granted from the Plan an option to purchase a
total of 7,500 shares of stock effective as of Nov. 5, 2002. These options shall
vest as follows: 2,500 shares on Nov. 5, 2003; 2500 shares on Nov 5, 2004; and
2,500 shares on Nov. 5, 2005.

        1.5.2    Annual Stock Option Grant.    Executive shall be eligible for
an annual stock option (the "Annual Stock Option") (including ISO's and NQO's).
The target grant for Executive shall be an option to purchase seventeen thousand
shares (17,000) of Common Stock, granted in accordance with the terms of the
Plan, the actual number of shares in the grant to be determined by the CEO and
the Compensation Committee of the Board of Directors. The first Annual Stock
Option shall be in accordance with the normal Company calendar for officers
following the 2001 fiscal year. Options granted to Executive pursuant to this
section shall be designated incentive stock options to the maximum extent
allowed by law.

2

--------------------------------------------------------------------------------

        1.6    Termination.    Executive's employment and this Agreement (except
as otherwise provided hereunder) shall terminate upon the occurrence of any of
the following at the time set forth therefor (the "Termination Date"):

        1.6.1    Death or Disability.    Immediately upon the death of Executive
or the determination by the CEO that Executive shall have been unable to
substantially perform the essential functions of his duties, with or without
reasonable accommodation, for a period of 100 days out of any period of 360
consecutive days ("Disability"); provided that prior to any termination due to
Disability, the Company shall have given Executive at least 14 days' advance
written notice of its intent to terminate Executive's Employment Term due to
Disability, and Executive shall not have returned to full-time employment by the
14th day after such notice (termination pursuant to this Section 1.6.1 being
referred to herein as termination for "Death or Disability"); or

        1.6.2    Voluntary Termination.    Thirty (30) days following the
receipt by the Company of Executive's written notice to the Company of
termination of employment; provided, however, that the Company may waive all or
a portion of the thirty (30) days' notice and accelerate the effective date of
such termination (and the Termination Date) (termination pursuant to this
Section 1.6.2 being referred to herein as "Voluntary Termination"); or

        1.6.3    Termination For Cause.    Immediately following notice of
termination for "Cause" (as defined below), specifying such Cause, given by the
Company (termination pursuant to this Section 1.6.3 being referred to herein as
termination for "Cause"). As used herein, "Cause" shall mean and be limited to
termination based on: (i) Executive's conviction or plea of "guilty" or "no
contest" to any crime constituting a felony in the jurisdiction in which
committed, any crime involving moral turpitude (whether or not a felony), or any
other violation of criminal law involving dishonesty or willful misconduct that
materially injures the Company (whether or not a felony); (ii) Executive's
substance abuse that in any manner materially interferes with the performance of
his duties; (iii) Executive's failure or refusal to perform his duties or to
follow the lawful and proper directives of the CEO that are within the scope of
his duties; (iv) Executive's material intentional breach of the Confidentiality
Agreement; or (v) Executive's violation of the Company's policies against
insider trading or Executive's intentional misconduct that materially injures
the Company.

        1.6.4    Termination Without Cause.    Thirty (30) days following
Executive's receipt of written notice of termination without Cause from the
Board of Directors; provided, however, that during any such thirty (30) day
notice period, the Company may suspend, with no reduction in pay or benefits,
Executive from his duties as set forth herein (including, without limitation,
Executive's position as a representative and agent of the Company) (termination
pursuant to this Section 1.6.4 being referred to herein as termination "Without
Cause").

        1.6.5    Constructive Termination.    Thirty (30) days following a
Constructive Termination (as defined below); provided, however, that during any
such thirty (30) day period, the Company may suspend, with no reduction in pay
or benefits, Executive from his duties as set forth herein (including, without
limitation, Executive's position as a representative and agent of the Company)
(termination pursuant to this Section 1.6.5 being referred to herein as
"Constructive Termination"). For purposes of this Section, a Constructive
Termination shall occur when:

        (a)  for a period of twelve (12) months following a Change in Control
(as defined below), Executive is terminated (other than for Cause) or Executive
voluntarily resigns because his (i) duties, responsibilities or level of
management to which Executive reports are materially reduced, (ii) Executive's
Base Salary is reduced by more than 15% or (iii) place of employment is
relocated by more than fifty (50) miles, in each case without Executive's
consent.

3

--------------------------------------------------------------------------------

          (i)  A "Change in Control" shall be deemed to occur in the event of a
change in ownership or control of the Company effected through any of the
following transactions:

the acquisition, directly or indirectly, by any person or related group of
persons (other than the Company or a person that directly or indirectly
controls, or is controlled by, or is under common control with, the Company) of
beneficial ownership (within the meaning of Rule 13d-3 of the Securities
Exchange Act of 1934, as amended) of securities possessing more than fifty
percent (50%) of the total combined voting power of the Company's outstanding
securities pursuant to a tender or exchange offer made directly to the Company's
stockholders; or

the sale, transfer or other disposition of all or substantially all of the
Company's assets; or

the consummation of a merger or consolidation of the Company with or into
another entity or any other corporate reorganization, if more than fifty percent
(50%) of the combined voting power of the continuing or surviving entity's
securities outstanding immediately after such merger, consolidation or other
reorganization is owned by persons who were not stockholders of the Company
immediately prior to such merger, consolidation or other reorganization.

        A transaction shall not constitute a Change in Control if its sole
purpose is to change the state of the Company's incorporation or to create a
holding company that will be owned in substantially the same proportions by the
persons who held the Company's securities immediately before such transaction.

        (b)  Executive provides written notice to the Company of termination for
Good Reason, which, as used herein, shall mean (A) a reduction in Executive's
titles, authority, duties or responsibilities, or the assignment of duties
inconsistent with Executive's position; (B) a change in reporting contrary to
the provisions of this Agreement; or (C) a failure to grant any equity
participation as provided in this Agreement, or (D) a reduction in Executive's
Base Salary not consistent with other DPI executives, in each case without
Executive's consent and continuing more than thirty (30) days following the
Company's receipt of written notice from Executive identifying the basis of the
alleged termination for Good Reason.

        1.6.6    Other Remedies.    Termination pursuant to this section shall
be in addition to and without prejudice to any other right or remedy to which
the Company or Executive may be entitled at law, in equity, or under this
Agreement.

        1.7    Severance    

        1.7.1    Voluntary Termination, Termination for Cause or Termination for
Death or Disability.    In the case of termination of Executive's employment
hereunder for Death or Disability in accordance with Section 1.6.1 above, or
Executive's Voluntary termination of employment hereunder in accordance with
Section 1.6.2 above, or a termination of Executive's employment hereunder for
Cause in accordance with Section 1.6.3 above, (i) Executive shall not be
entitled to receive payment of, and the Company shall have no obligation to pay,
any severance or similar compensation attributable to such termination, other
than Base Salary earned but unpaid, accrued but unused vacation to the extent
allowed by the Company's policies, vested benefits under any employee benefit
plan, and any unreimbursed expenses pursuant to Section 1.4.4 hereof incurred by
Executive as of the Termination Date; and (ii) the Company's other obligations
under this Agreement shall immediately cease.

        1.7.2    Termination Without Cause.    (a) In the case of a termination
of Executive's employment hereunder Without Cause in accordance with
Section 1.6.4, the Company shall pay Executive,

4

--------------------------------------------------------------------------------

without discount, or any obligation on the part of Executive to mitigate the
amount of such payment (by seeking alternate employment or otherwise),
(hereinafter the "Severance Payment") (i) all accrued compensation and benefits;
provided that, there will be no partial payment of the Incentive Compensation
and (ii) an amount equal to 12 months' salary, in a lump-sum payment subject to
the tax withholding specified in Section 1.4.1 above. Executive shall have
twelve (12) months from the Termination Date to exercise his vested shares.

        (b)  During the twelve months after the Hire Date should Executive be
terminated Without Cause, the stock options scheduled to vest at the end of that
one-year period shall be accelerated and shall vest immediately (there is no
acceleration of any unvested options after Executive's first year with the
Company). The acceleration under this subsection 1.7.2(b) does not fall within
the definition of a "Severance Payment".

        The above amounts represent the entire compensation Executive is
entitled to receive upon termination Without Cause.

        1.7.3    Constructive Termination Due to Change of Control.    In the
case of the Constructive Termination Due to Change of Control of Executive's
employment in accordance with Section 1.6.5(a), the Company shall pay Executive
the Severance Payment and also Executive's outstanding stock options (to the
extent then unexercisable) will all automatically accelerate consistent with the
Plan and become exercisable in full. The above amounts represent the entire
compensation Executive is entitled to receive upon a Constructive Termination.
Executive shall have twelve (12) months from the Termination Date to exercise
his vested shares.

        1.7.4    Constructive Termination for Good Reason.    Constructive
Termination for Good Reason under Section 1.6.5(b), during the twelve
(12) months following the Hire Date, shall entitle Executive to the Severance
Payout set forth in Section 1.7.2. In addition, should Constructive Termination
for Good Reason occur during the twelve (12) months following the Hire Date, the
Executive's stock options scheduled to vest at the end of that one-year period
shall be accelerated and shall vest immediately. Executive shall have twelve
(12) months from the Termination Date to exercise his vested shares.

2.    PROTECTION OF COMPANY'S CONFIDENTIAL, PROPRIETARY INFORMATION AND
INVENTIONS.

        This Agreement, and Executive's employment hereunder, is contingent upon
Executive's execution of the Confidentiality, Proprietary Information and
Inventions Agreement, before the Hire Date.

3.    REPRESENTATIONS AND WARRANTIES

        Each party hereto represents and warrants that (i) this Agreement is
valid and binding upon and enforceable against such party in accordance with the
terms of this Agreement, (ii) such party is not bound by or subject to any
contractual or other obligation that would be violated by such party's execution
or performance of this Agreement, including, but not limited to, any
non-competition agreement presently in effect, and (iii) such party is not
subject to any pending or, to such party's knowledge, threatened, claim, action,
judgment, order, or investigation that could adversely affect such party's
ability to perform its obligations under this Agreement in a material respect.

4.    MISCELLANEOUS

        4.1    Indemnification.    The Company shall indemnify Executive from
any liability arising out of his performance of his duties hereunder to the full
extent permitted by law, and shall provide Executive all

5

--------------------------------------------------------------------------------

benefits under any directors and officers, errors and omissions, or similar
insurance policy from time to time in effect.

        4.2    Notices.    All notices, requests, and other communications
hereunder must be in writing and will be deemed to have been duly given only if
delivered personally against written receipt or by facsimile transmission with
answer back confirmation or mailed (postage prepaid by certified or registered
mail, return receipt requested) or by overnight courier to the parties at the
following addresses or facsimile numbers:

        If to the Executive, to:

        If to the Company, to:

John M. Lynn
DuPont Photomasks, Inc.
131 Old Settlers Blvd.
Round Rock, Texas 78664
(512) 310-6527

All such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section 4.2, be deemed given upon
delivery, and (ii) if delivered by mail in the manner described above to the
address as provided in this Section 4.1. be deemed given upon receipt (in each
case regardless of whether such notice, request, or other communication is
received by any other Person to whom a copy of such notice, request or other
communication is to be delivered pursuant to this Section). Any party from time
to time may change its address or other information for the purpose of notices
to that party by giving written notice specifying such change to the other party
hereto.

        4.3    Authorization to be Employed.    This Agreement, and Executive's
employment hereunder, is subject to Executive providing the Company with legally
required proof of Executive's authorization to be employed in the United States
of America.

        4.4    Entire Agreement.    This Agreement, which includes the Exhibits
hereto, supersedes all prior discussions and agreements, among the parties with
respect to the subject matter hereof and contains the sole and entire agreement
between the parties hereto with respect thereto. In the event of conflict
between the terms of the text of this Agreement (excluding for this purpose the
Exhibits hereto), on the one hand, and the terms of the Confidentiality
Agreement, the Plan, the Bonus Plan, the Relocation Plan, or the form of Option
Agreement, on the other hand, the terms of this Agreement (excluding for this
purpose the Exhibits hereto) shall control. Any provision of this Agreement
which by its terms obliges the Company to make payments subsequent to
termination of Executive's Employment Term shall survive any such termination.

        4.5    Waiver.    Any term or condition of this Agreement may be waived
at any time by the party that is entitled to the benefit thereof, but no such
waiver shall be effective unless set forth in a written instrument duly executed
by or on behalf of the party waiving such term or condition. No waiver by any
party hereto of any term or condition of this Agreement, in any one or more
instances, shall be deemed to be or construed as a waiver of the same or any
other term or condition of this Agreement on any future occasion. All remedies,
either under this Agreement or by law or otherwise afforded, will be cumulative
and not alternative.

        4.6    Amendment.    This Agreement may be amended, supplemented, or
modified only by a written instrument duly executed by or on behalf of each
party hereto.

6

--------------------------------------------------------------------------------

        4.7    No Third Party Beneficiary.    The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto and the
Company's successors or assigns, and it is not the intention of the parties to
confer third-party beneficiary rights upon any other person.

        4.8    No Assignment; Binding Effect.    This Agreement and the
obligations undertaken herein shall be binding upon and shall inure to the
benefit of any successors or assigns of the Company. Executive shall not be
entitled to assign his obligations under this Agreement.

        4.9    Headings.    The headings used in this Agreement have been
inserted for convenience of reference only and do not define or limit the
provisions hereof.

        4.10    Severability.    The Company and Executive intend all provisions
of this Agreement to be enforced to the fullest extent permitted by law.
Accordingly, if a court of competent jurisdiction determines that the scope
and/or operation of any provision of this Agreement is too broad to be enforced
as written, the Company and Executive intend that the court should reform such
provision to such narrower scope and/or operation as it determines to be
enforceable. If, however, any provision of this Agreement is held to be illegal,
invalid, or unenforceable under present or future law, and not subject to
reformation, then (i) such provision shall be fully severable, (ii) this
Agreement shall be construed and enforced as if such provision was never a part
of this Agreement, and (iii) the remaining provisions of this Agreement shall
remain in full force and effect and shall not be affected by illegal, invalid,
or unenforceable provisions or by their severance.

        4.11    Governing Law.    This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas applicable to
contracts executed and performed in such State without giving effect to
conflicts of laws principles.

        4.12    Jurisdiction.    With respect to any suit, action, or other
proceeding arising from (or relating to) this Agreement, the Company and
Executive hereby irrevocably agree to the nonexclusive personal jurisdiction and
venue of the United Status District Court for the Western District of Texas (and
any Texas State Court within Travis County, Texas).

        4.13    Counterparts.    This Agreement may be executed in any number of
counterparts and by facsimile, each of which will be deemed an original, but all
of which together will constitute one and the same instrument.

        [SIGNATURE PAGE TO EMPLOYMENT AGREEMENT FOLLOWS]

7

--------------------------------------------------------------------------------

        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first written above.

    DuPont Photomasks, Inc., as the Company
 
 
By:
 
/s/  PETER S. KIRLIN      

--------------------------------------------------------------------------------

    Name:   Peter S. Kirlin

--------------------------------------------------------------------------------

    Title:   Chief Executive Officer and Chairman

--------------------------------------------------------------------------------

    Date:   October 11, 2001

--------------------------------------------------------------------------------

 
 
                                , as Executive
 
 
/s/  SATISH RISHI      

--------------------------------------------------------------------------------

Signature
 
 
Satish Rishi

--------------------------------------------------------------------------------

    October 11, 2001

--------------------------------------------------------------------------------

Annex A   Confidentiality Agreement   (per §1.4.1) B   Form of Option Agreement
  (per §1.5.1)

8

--------------------------------------------------------------------------------

QuickLinks

EXHIBIT 10.26

EMPLOYMENT AGREEMENT