<PAGE>
                                                                   EXHIBIT 10.26

                                 SCANSOFT, INC.

                                VESTING AGREEMENT

      This Vesting Agreement (the "Agreement") is made and entered into
effective as of June 24, 1999, by and between Wayne Crandall (the "Employee")
and ScanSoft, Inc., a Delaware corporation (the "Company").

                                    RECITALS

      A. It is expected that another company or other entity may from time to
time consider the possibility of acquiring the Company or that a change in
control may otherwise occur, without the approval of the Company's Board of
Directors (the "Board"). The Board recognizes that such consideration can be a
distraction to the Employee and can cause the Employee to consider alternative
employment opportunities. The Board has determined that it is in the best
interests of the Company and its stockholders to assure that the Company will
have the continued dedication and objectivity of the Employee, notwithstanding
the possibility, threat or occurrence of a Change of Control (as defined below)
of the Company.

      B. The Board believes that it is in the best interests of the Company and
its stockholders to provide the Employee with an incentive to continue his or
her employment with the Company.

      C. The Board believes that it is imperative to provide the Employee with
certain benefits, upon termination of the Employee's employment in connection
with a Change of Control, which benefits are intended to provide the Employee
with financial security and provide sufficient income and encouragement to the
Employee to remain with the Company notwithstanding the possibility of a Change
of Control.

      D. To accomplish the foregoing objectives, the Board of Directors has
directed the Company, upon execution of this Agreement by the Employee, to agree
to the terms provided in this Agreement.

      E. Certain capitalized terms used in the Agreement are defined in Section
3 below.

      In consideration of the mutual covenants herein contained, and in
consideration of the continuing employment of Employee by the Company from the
date hereof, the parties agree as follows:

      1. At-Will Employment. The Company and the Employee acknowledge that the
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,
including (without limitation) any termination prior to a Change of Control
(other than as provided herein), the Employee shall not be entitled to any
payments, benefits, damages, awards or compensation other than as provided by
this Agreement, or as may otherwise be available in accordance with the
Company's established employee plans and
<PAGE>
written policies and employment contracts (if any) at the time of termination.
The terms of this Agreement shall terminate upon the earlier of (i) the date
that all obligations of the parties hereunder have been satisfied, or (ii)
twelve (12) months after a Change of Control. A termination of the terms of this
Agreement pursuant to the preceding sentence shall be effective for all
purposes, except that such termination shall not affect the payment or provision
of compensation or benefits on account of a termination of employment occurring
prior to the termination of the terms of this Agreement.

      2. Change of Control.

            (a) Termination Following A Change of Control. Subject to Section 4
below, if the Employee's employment with the Company is terminated at any time
prior to, but in contemplation of, or within twelve (12) months after, a Change
of Control, then the Employee shall be entitled to receive or shall not be
entitled to receive accelerated vesting of stock options or stock grants as
follows:

                  (i) Voluntary Resignation. If the Employee voluntarily resigns
from the Company (other than as an Involuntary Termination (as defined below))
or if the Company terminates the Employee's employment for Cause (as defined
below), then the Employee shall not be entitled to receive any benefits
hereunder.

                  (ii) Involuntary Termination. If the Employee's employment is
terminated as a result of an Involuntary Termination other than for Cause, each
stock option or stock grant granted for the Company's securities held by the
Employee shall become vested on the termination date as to the shares subject to
such stock option or stock grant that have not otherwise vested as of such date
and shall be exercisable in accordance with the provisions of the agreement
and/or the Plan pursuant to which such stock option or stock grant was granted.
All other benefits will be terminated under the Company's then existing benefit
plans and policies in accordance with such plans and policies in effect on the
date of termination or as otherwise determined by the Board of Directors of the
Company.

                  (iii) Involuntary Termination for Cause. If the Employee's
employment is terminated for Cause, then the Employee shall not be entitled to
receive any accelerated vesting hereunder.

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


                                      -2-
<PAGE>
            (b) Cause. "Cause" shall mean (i) gross negligence or willful
misconduct in the performance of the Employee's duties to the Company 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 (ii) repeated
unexplained or unjustified absence from the Company, (iii) a material and
willful violation of any federal or state law; (iv) commission of any act of
fraud with respect to the Company; (v) conviction of a felony or a crime
involving moral turpitude causing material harm to the standing and reputation
of the Company; or (vi) a material and willful violation of any of the
provisions of the Company's Propriety Information Agreement, in each case as
determined in good faith by the Board of Directors of the Company.

            (c) Involuntary Termination. "Involuntary Termination" shall include
any termination by the Company other than for Cause; or the Employee's voluntary
termination, upon 30 days prior written notice to the Company, within three (3)
months following (i) a material reduction or change in job duties,
responsibilities and requirements inconsistent with Employee's position with the
Company and the Employee's prior duties, responsibilities and requirements, (ii)
a greater than 20% reduction in the Employee's annual base compensation, or
(iii) the Employee's refusal to relocate to a facility or location outside of
the metropolitan area in which the Employee is working.

      4. Excise Tax Payment. In the event that any payments or benefits to be
received by Employee pursuant to this Agreement would result in the imposition
of an excise pursuant to Section 4999 of the Internal Revenue Code of 1986, as
amended (the "Code") or any corresponding provisions of state income tax law,
Employee shall receive the entire amount of the payments or benefits to which
Employee is entitled under this Agreement, in which event Employee shall be
responsible for the payment of all excise taxes imposed under the Code with
respect to such payments or benefits.

      5. Successor. Any successor to the Company (whether direct or indirect
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 the Employee's rights
hereunder shall inure to the benefit of and be enforceable by, the Employee's
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.

      6. 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 postage prepaid. Mailed notices to the Employee shall be
addressed to the Employee at the home address which the Employee most recently
communicated to the Company in writing. In the case of the Company, mailed
notices shall be addressed to its corporate headquarters, and all notices shall
be directed to the attention of its Secretary.

      7. Miscellaneous Provisions.


                                      -3-
<PAGE>
            (a) No Duty to Mitigate. The 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, except as otherwise
provided in this Agreement, shall any such payment be reduced by any earnings
that the Employee my receive from any other source.

            (b) Waiver. No provision of this Agreement shall be modified, waived
or discharged unless the modification, waiver or discharge is agreed to in
writing and signed by the Employee and by an authorized officer of the Company
(other than the Employee). No waiver by either party of any breach of, or of
compliance with, any condition or provision of this Agreement by the other party
shall be considered a waiver of any other condition or provision or of the same
condition or provision at another time.

            (c) Whole Agreement. No agreements, representations or
understandings (whether oral or written and whether express or implied) which
are not express set forth in this Agreement have been made or entered into by
either party with respect to the subject matter hereof. This Agreement
supersedes any agreement of the same title and concerning similar subject matter
dated prior to the date of this Agreement, and by execution of this Agreement
both parties agree that any such predecessor agreement shall be deemed null and
void.

            (d) Choice of Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
California without reference to conflict of laws provisions. The parties agree
that all disputes arising among them related to this Agreement, whether arising
in contract, tort, equity or otherwise, shall be resolved only in the United
States federal courts in the Northern District of California or California state
courts located in Peabody, MA. Each party hereby waives any disputes it may have
with respect to the location of any court.

            (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 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) Arbitration. Any dispute or controversy arising under or in
connection with this Agreement may be settled at the option of either party by
binding arbitration in Peabody, MA, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction. Punitive damages shall not
be awarded.

            (g) Legal Fees and Expenses. The parties shall each bear their own
expenses, legal fees and other fees incurred in connection with this Agreement.
The parties agree, however, that the prevailing party in any arbitration
proceeding brought under or in connection with this Agreement shah be awarded
reasonable attorneys' fees and costs.


                                      -4-
<PAGE>
            (h) No Assignment of Benefits. The rights of any person to payment
or benefits under this Agreement shall not be made subject to option or
assignment, either by voluntary or involuntary assignment or by operation of
law, including (without limitation) bankruptcy, garnishment, attachment or other
creditor's process, and any action in violation of this subsection (h) shall be
void.

            (i) Employment Taxes. All payments made pursuant to this Agreement
will be subject to withholding of applicable income and employment taxes.

            (j) Assignment by Company. The Company may assign its rights under
this Agreement to an affiliate, and an affiliate may assign its rights under
this Agreement to another affiliate of the Company or to the Company; provided,
however, that no assignment shall be made if the net worth of the assignee is
less than the net worth of the Company at the time of assignment. In the case of
any such assignment, the term "Company" when used in a section of this Agreement
shall mean the corporation that actually employs the Employee.

            (k) 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.

      IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by its duly authorized officer, as of the day and year
first above written.

SCANSOFT, INC.                                EMPLOYEE

By: /s/ Jill Buckley                          /s/ Wayne Crandall
    --------------------------------          ----------------------------------

Title: Director, Human Resources
       -----------------------------


                                      -5-