**Exhibit10.14**

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**EMPLOYMENT AGREEMENT**

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THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and enteredinto as of the 26th day of August, 2002, by and between EVANS & SUTHERLANDCOMPUTER CORPORATION, a Utah corporation (the “Company”) and Kirk D.Johnson (the “Executive”).

 

W I T N E S S E T H:

 

WHEREAS, the Executive has been providing services to the Company in anexecutive capacity and desires to continue to provide such services;

 

WHEREAS, the Company desires to have the benefit of the Executive’sefforts and services;

 

WHEREAS, the Company and Executive desire to terminate all prioremployment agreements with the Company, if any; and

 

WHEREAS, the Company has determined that it is appropriate and in thebest interests of the Company to provide to the Executive protection in theevent of certain terminations of the Executive’s employment relationship withthe Company in accordance with the terms and conditions contained herein andthe Executive desires to have such protection.

 

NOW, THEREFORE, in consideration of the foregoing and of the mutualcovenants and agreements hereinafter set forth, the Company and the Executivehereto mutually covenant and agree as follows:

 

1.**                                      **DEFINITIONS.

 

Whenever used in this Agreement, the following terms shall have themeanings set forth below:

 

(a)                                  “AccruedBenefits” shall mean the amount equal to the sum of the following to theextent not previously paid:

 

(i)                                     All salary earnedor accrued through the Termination Date;

 

(ii)                                  Reimbursementpursuant to Section 6(d) for any and all monies advanced in connectionwith the Executive’s employment for reasonable and necessary expenses incurredby the Executive through the Termination Date;

 

(iii)                               Any and all other cashbenefits of deferred compensation plans previously earned through theTermination Date unless deferred at the election of the Executive for paymentat another time or the applicable deferred compensation plan provides forpayment at another time;

 

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(iv)                              Thefull amount of any bonus earned in a prior period and payable to the Executivein accordance with Section 6(b) herein, subject to the limitations in Section 10and Section 12; and

 

(v)                                 Allother payments and benefits to which the Executive may be entitled under theterms of any benefit plan of the Company, which as of the Termination Date, isapplicable to all regular full-time employees of the Company generally.

 

(b)                                 “Act”shall mean the Securities Exchange Act of 1934;

 

(c)                                  “Affiliate”shall have the same meaning as given to that term in Rule 12b-2 of Regulation12B promulgated under the Act;

 

(d)                                 “BasePeriod Income” shall be an amount equal to the Executive’s “annualizedincludable compensation” for the “base period” as defined in Sections280G(d)(1) and (2) of the Code and the regulations adopted thereunder;

 

(e)                                  “BeneficialOwner” shall have the same meaning as given to that term in Rule 13d-3 ofthe Act, provided that any pledgee of Company voting securities shall not bedeemed to be the Beneficial Owner thereof prior to its disposition of, oracquisition of voting rights with respect to, such securities;

 

(f)                                    “Board”shall mean the Board of Directors of the Company;

 

(g)                                 “Cause”shall mean any of the following:

 

(i)                                     The engaging bythe Executive in fraudulent conduct, as evidenced by a determination in abinding and final judgment, order or decree of a court or administrative agencyof competent jurisdiction, in effect after exhaustion or lapse of all rights ofappeal, in an action, suit or proceeding, whether civil, criminal,administrative or investigative, which the Chief Executive Officer of theCompany determines, in his sole discretion, has a significant adverse impact onthe Company or on the performance of the Executive’s duties to the Company;

 

(ii)                                  Conviction of afelony, as evidenced by a binding and final judgment, order or decree of acourt of competent jurisdiction, in effect after exhaustion or lapse of allrights of appeal, which the Chief Executive Officer of the Company determines,in his sole discretion, has a significant adverse impact on the Company or onthe performance of the Executive’s duties to the Company;

 

(iii)                               Neglect or refusal bythe Executive to perform the Executive’s duties or responsibilities; or

 

(iv)                              A significant violationby the Executive of the Company’s established policies and procedures;

 

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Notwithstanding theforegoing, Cause shall not exist under Sections 1(g)(iii) and (iv) hereinunless the Company furnishes written notice to the Executive of the specificoffending conduct and the Executive fails to correct such offending conductwithin the thirty (30) day period commencing on the receipt of such notice.

 

(h)                                 “Changeof Control” shall mean a change in ownership or managerial control of thestock, assets or business of the Company resulting from one or more of thefollowing circumstances:

 

(i)                                     A change ofcontrol of the Company, of a nature that would be required to be reported inresponse to Item 6(e) of Schedule 14A of Regulation 14A promulgated underthe Act, or any successor regulation of similar import, regardless of whetherthe Company is subject to such reporting requirement;

 

(ii)                                  A change in ownershipof the Company through a transaction or series of transactions, such that anyPerson or Persons (other than any current officer of the Company or member ofthe Board) become(s), in the aggregate, the Beneficial Owner(s), directly orindirectly, of securities of the Company representing thirty percent (30%) ormore of the Company’s then outstanding securities;

 

(iii)                               Any consolidation ormerger of the Company in which the Company is not the continuing or survivingcorporation or pursuant to which shares of the common stock of the Companywould be converted into cash (other than cash attributable to dissenters’rights), securities or other property provided by a Person or Persons otherthan the Company, other than a consolidation or merger of the Company in whichthe holders of the common stock of the Company immediately prior to theconsolidation or merger have approximately the same proportionate ownership ofcommon stock of the surviving corporation immediately after the consolidationor merger;

 

(iv)                              The shareholders of theCompany approve a sale, transfer, liquidation or other disposition of all orsubstantially all of the assets of the Company to a Person or Persons;

 

(v)                                 During any period oftwo (2) consecutive years, individuals who, at the beginning of such period,constituted the Board of Directors of the Company cease, for any reason, toconstitute at least a majority thereof, unless the election or nomination forelection of each new director was approved by the vote of at least two-thirds(2/3) of the directors then still in office who were directors at the beginningof the period;

 

(vi)                              The filing of aproceeding under Chapter 7 of the Federal Bankruptcy Code (or any successor orother statute of similar import) for liquidation with respect to the Company;or

 

(vii)                           The filing of a proceedingunder Chapter 11 of the Federal Bankruptcy Code (or any successor or otherstatute of similar import) for

 

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reorganization withrespect to the Company if in connection with any such proceeding, thisAgreement is rejected, or a plan of reorganization is approved an element of whichplan entails the liquidation of all or substantially all the assets of theCompany.

 

A “Change of Control”shall be deemed to occur on the actual date on which any of the foregoingcircumstances shall occur; provided, however, that in connection with a “Changeof Control” specified in Section 1(h)(vii), a “Change of Control” shall bedeemed to occur on the date of the filing of the relevant proceeding underChapter 11 of the Federal Bankruptcy Code (or any successor or other statute ofsimilar import).  Notwithstanding theforegoing, a “Change of Control” shall not include any transaction thatconstitutes a “Rule 13e-3 transaction” under Rule 13e-3 of the Act or an “issuertender offer” under Rule 13e-4 of the Act.

 

(i)                                     “Changeof Control Period” shall mean the period commencing 180 days immediatelyprior to the date a Change of Control is deemed to occur pursuant to Section 1(h),herein, and ending on the second anniversary of such date;

 

(j)                                     “Code”shall mean the Internal Revenue Code of 1986, as amended from time to time;

 

(k)                                  “Disability”shall mean a physical or mental condition whereby the Executive is unable toperform on a full-time basis the customary duties of the Executive under thisAgreement;

 

(l)                                     “FederalShort Term-Rate” shall mean the rate defined in Section 1274(d)(1)(C)(i)of the Code;

 

(m)                               “GoodReason” shall mean any of the following:

 

(i)                                     The requiredrelocation of the Executive, without the Executive’s consent, to an employmentlocation which is more than seventy-five (75) miles from the Executive’semployment location on the day preceding the date of this Agreement; or

 

(ii)                                  Breach or violationof any material provision of this Agreement by the Company, which is notremedied within five business days following notice to the Company by theExecutive.

 

(n)                                 “GoodReason During a Change of Control” shall mean any of the following eventsoccurring during a Change of Control Period:

 

(i)                                     The requiredrelocation of the Executive, without the Executive’s consent, to an employmentlocation which is more than seventy-five (75) miles from the Executive’semployment location on the day preceding the date of this Agreement;

 

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(ii)                                  The removal of theExecutive from or any failure to reelect the Executive to any of the positionsheld by the Executive during the 180-day period immediately preceding theChange of Control Period, except in the event that such removal or failure toreelect relates to the termination by the Company of the Executive’s employmentfor Cause or by reason of death, Disability or voluntary retirement;

 

(iii)                               A significant adversechange, without the Executive’s written consent, in the nature or scope of theExecutive’s authority, powers, functions, duties or responsibilities that existedduring the 180-day period immediately preceding the Change of Control Period,or a material reduction in the level of support services, staff, secretarialand other assistance, office space and accoutrements available to a level belowthat which was provided to the Executive during the 180-day period immediatelypreceding the Change of Control Period, and that which is necessary to performany duties assigned to the Executive during the 180-day period immediatelypreceding the Change of Control Period; or

 

(iv)                              Breach or violation ofany material provision of this Agreement by the Company, which is not remediedwithin five business days following notice to the Company by the Executive;

 

(o)                                 “GrossIncome” shall mean the Executive’s current calendar year targetedcompensation under Sections 6(a)-(b) of this Agreement;

 

(p)                                 “Noticeof Termination” shall mean the notice described in Section 14 herein;

 

(q)                                 “Person”shall mean any individual, partnership, joint venture, association, trust,corporation or other entity, other than an employee benefit plan of the Companyor an entity organized, appointed or established pursuant to the terms of anysuch benefit plan;

 

(r)                                    “TerminationDate” shall mean, except as otherwise provided in Section 14 herein,

 

(i)                                     The Executive’sdate of death;

 

(ii)                                  Thirty (30) daysafter the delivery of the Notice of Termination terminating the Executive’semployment on account of Disability pursuant to Section 9 herein, unlessthe Executive returns on a full-time basis to the performance of his or herduties prior to the expiration of such period;

 

(iii)                               Thirty (30) days afterthe delivery of the Notice of Termination if the Executive’s employment isterminated by the Executive voluntarily;

 

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(iv)                              Thirty(30) days after the delivery of the Notice of Termination if the Executive’semployment is terminated by the Company for any reason other than death orDisability; or

 

(v)                                 Thedate the Executive is terminated for Cause.

 

(s)                                  “TerminationPayment” shall mean the payment described in Section 13 herein;

 

(t)                                    “TotalPayments” shall mean the sum of the Termination Payment and any other “paymentsin the nature of compensation” (as defined in Section 280G of the Code andthe regulations adopted thereunder) to or for the benefit of the Executive, thereceipt of which is contingent on a Change of Control and to which Section 280Gof the Code applies.

 

2.**                                      **EMPLOYMENT.

 

The Company hereby agrees to employ the Executive and the Executivehereby agrees to serve the Company, on the terms and conditions set forthherein.

 

3.**                                      **TERM.

 

The employment of the Executive by the Company pursuant to theprovisions of this Agreement shall commence on the date hereof and end on thatdate employment of the Executive is terminated pursuant to the terms andconditions of either Section 8, 9, 10, 11 or 12, herein.

 

4.**                                      **POSITIONSAND DUTIES.

 

The Executive shall serve as Vice President and General Manager,Digital Theater Division of the Company and in such additional capacities asset forth in Section 7 herein.  Inconnection with the foregoing positions, the Executive shall have such duties,responsibilities and authority as may from time to time be assigned to theExecutive by the Chief Executive Officer. The Executive shall devote substantially all the Executive’s workingtime and efforts to the business and affairs of the Company.  The Chief Executive Officer, in his or hersole discretion, may alter, modify, or change the Executive’s duties, offices,positions, responsibilities and obligations set forth in this Agreement at anytime, consistent with the status of a senior executive of the Company.

 

5.**                                      **PLACEOF PERFORMANCE.

 

In connection with the Executive’s employment by the Company, theExecutive shall be based at the principal executive offices of the Company inSalt Lake City, Utah except for required travel on Company business.

 

6.**                                      **COMPENSATIONAND RELATED MATTERS.

 

(a)                                  Salary.  The Company shall pay to the Executive anannualized base salary at a rate of $129,500.00 in equal installments as nearlyas practicable on the

 

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Company’s regular payrolldates, in arrears.  Such annualized basesalary may be increased from time to time in accordance with normal businesspractices of the Company.  The annualizedbase salary of the Executive shall not be decreased below its then existingamount during the term of this Agreement;

 

(b)                                 MIPand MIP-Q.  Subject to the Company’sright to terminate or amend, at any time with or without notice to theExecutive, the Evans & Sutherland Management Incentive Plan (MIP) and theEvans & Sutherland Quarterly Management Incentive Plan (MIP-Q), theExecutive shall be entitled to participate in the Evans & Sutherland MIPand MIP-Q as agreed in writing in a MIP and a MIP-Q document;

 

(c)                                  ExecutiveSavings Plan.  Subject to the Company’sright to terminate or amend, at any time with or without notice to theExecutive, the Company’s Executive Savings Plan, the Executive shall beentitled to participate in the Executive Savings Plan according to the termsand conditions of the Executive Savings Plan.

 

(d)                                 Expenses.  The Executive shall be entitled to receiveprompt reimbursement for all reasonable expenses incurred by the Executive inperforming services hereunder, including all expenses for travel and livingexpenses while away from home on business or at the request of and in theservice of the Company, provided that such expenses are incurred and accountedfor in accordance with the policies and procedures established by the Companyat the time incurred;

 

(e)                                  OtherBenefits.  The Company shall providethe Executive with all other benefits normally provided to an employee of theCompany similarly situated to the Executive, including being added as a namedofficer on the Company’s existing directors’ and officers’ liability insurancepolicy;

 

(f)                                    Vacations.  The Executive shall be entitled to the numberof vacation days in each calendar year, and to compensation in respect ofearned but unused vacation days, determined in accordance with the Company’svacation plan as in effect from time to time. The Executive shall also be entitled to all paid holidays given by theCompany to its executives; and

 

(g)                                 ServicesFurnished.  The Company shall furnishthe Executive with office space, and such other facilities and services asshall be suitable to the Executive’s position and adequate for the performanceof the Executive’s duties as set forth in Section 4 hereof.

 

7.**                                      **OFFICES.

 

The Executive agrees to serve without additional compensation, ifelected or appointed thereto, in one or more executive offices of the Company,or any affiliate or subsidiary of the Company, or as a member of the board ofdirectors of any subsidiary or affiliate of the Company; provided, however,that the Executive is indemnified for serving in any and all such capacities ona basis no less favorable than is currently provided in the Company’s bylaws,or otherwise.

 

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8.                                       TERMINATIONAS A RESULT OF DEATH.

 

If the Executive shall die during the term of this Agreement, theExecutive’s employment shall terminate on the Executive’s date of death and theExecutive’s surviving spouse, or the Executive’s estate if the Executive dieswithout a surviving spouse, shall be entitled to the Executive’s AccruedBenefits as of the Termination Date and the applicable Termination Payment.

 

9.**                                      **TERMINATIONFOR DISABILITY.

 

If, as a result of the Executive’s Disability, the Executive shall havebeen unable to perform the Executive’s duties hereunder on a full-time basisfor four (4) consecutive months and within thirty (30) days after the Companyprovides the Executive with a Termination Notice, the Executive shall not havereturned to the performance of the Executive’s duties on a full-time basis, theCompany may terminate the Executive’s employment, subject to Section 14herein.  During the term of the Executive’sDisability prior to termination, the Executive shall continue to receive allsalary and other benefits payable under Section 6 herein, includingparticipation in all employee benefit plans, programs and arrangements in whichthe Executive was entitled to participate immediately prior to the Disability;provided, however, that the Executive’s continued participation is permittedunder the terms and provisions of such plans, programs and arrangements.  In the event that the Executive’sparticipation in any such plan, program or arrangement is barred as the resultof such Disability, the Executive shall be entitled to receive an amount equalto the contributions, payments, credits or allocations which would have beenpaid by the Company to the Executive, to the Executive’s account or on theExecutive’s behalf under such plans, programs and arrangements.  In the event the Executive’s employment isterminated on account of the Executive’s Disability in accordance with this Section 9,the Executive shall receive the Executive’s Accrued Benefits as of theTermination Date and shall remain eligible for all benefits provided by anylong-term disability programs of the Company in effect at the time of suchtermination.  The Executive shall also beentitled to the Termination Payment described in Section 13(a).

 

10.**                                **TERMINATIONFOR CAUSE.

 

If the Executive’s employment with the Company is terminated by theCompany for Cause, subject to the procedures set forth in Section 14herein, the Executive shall be entitled to receive the Executive’s AccruedBenefits as of the Termination Date, however, the Executive’s Accrued Benefitswill not include any amount for bonus under Section 1(a)(iv).  The Executive shall not be entitled toreceipt of any Termination Payment.

 

11.**                                **OTHERTERMINATION BY COMPANY.

 

If the Executive’s employment with the Company is terminated by theCompany other than by reason of death, Disability or Cause, subject to theprocedures set forth in Section 14 herein, the Executive (or in the eventof the Executive’s death following the Termination Date, the Executive’ssurviving spouse or the Executive’s estate if the Executive dies without asurviving spouse) shall receive the Executive’s Accrued Benefits and theapplicable Termination Payment.  TheExecutive shall not, in connection with any consideration receivable in

 

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accordance with this Section 11, be required tomitigate the amount of such consideration by securing other employment orotherwise and such consideration shall not be reduced by reason of theExecutive securing other employment or for any other reason.

 

12.**                                **VOLUNTARYTERMINATION BY EXECUTIVE.

 

From and after the date of this Agreement, provided that the Executivefurnishes thirty (30) days prior written notice to the Company, the Executiveshall have the right to voluntarily terminate this Agreement at any time.  If the Executive’s voluntary termination iswithout Good Reason or without Good Reason During a Change of Control, theExecutive shall receive the Executive’s Accrued Benefits as of the TerminationDate and shall not be entitled to any Termination Payment, however, theExecutive’s Accrued Benefits will not include any amount for bonus under Section 1(a)(iv).  If the Executive’s voluntary termination isfor Good Reason or Good Reason During a Change of Control, the Executive (or inthe event of the Executive’s death following the Termination Date, theExecutive’s surviving spouse or the Executive’s estate if the Executive dieswithout a surviving spouse) shall receive the Executive’s Accrued Benefits andthe applicable Termination Payment.  TheExecutive shall not, in connection with any consideration receivable inaccordance with this Section 12, be required to mitigate the amount ofsuch consideration by securing other employment or otherwise and suchconsideration shall not be reduced by reason of the Executive securing otheremployment or for any other reason.

 

13.**                                **TERMINATIONPAYMENT.

 

(a)                                  Ifthe Executive’s employment is terminated as a result of death or Disability,the Executive shall receive a Termination Payment equal to one (1.0) times theExecutive’s Gross Income.  The Companywill also pay the full medical, dental and vision premiums for continuationcoverage under COBRA for the Executive and dependents who qualify forcontinuation coverage under COBRA for one year following Termination Date.

 

(b)                                 If,prior to a Change of Control Period, the Executive’s employment is terminatedby the Executive for Good Reason or by the Company for any reason other thandeath, Disability or Cause, the Termination Payment payable to the Executive bythe Company or an affiliate of the Company shall be equal to one (1.0) timesthe Executive’s Gross Income.  TheCompany will pay the full medical, dental and vision premiums for continuationcoverage under COBRA for the Executive and dependents who qualify forcontinuation coverage under COBRA for one year following the Termination Date.

 

(c)                                  If,during a Change of Control Period, the Executive’s employment is terminated bythe Executive for Good Reason During a Change of Control or by the Company forany reason other than death, Disability, or Cause, the Termination Paymentpayable to the Executive by the Company or an affiliate of the Company shall beone (1.0) times the Executive’s Gross Income. The Company will pay the full medical, dental and vision premiums forcontinuation coverage under COBRA for the Executive and dependents who qualifyfor continuation coverage under COBRA for one (1) year following theTermination Date.

 

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(d)                                 Itis the intention of the Company and the Executive that the benefits under thisAgreement shall be capped such that no portion of the Termination Payment andany other “payments in the nature of compensation” (as defined in Section 280Gof the Code and the regulations adopted thereunder) to or for the benefit ofthe Executive under this Agreement, or under any other agreement, plan orarrangement, shall be deemed to be an “excess parachute payment” as defined in Section 280Gof the Code.  It is agreed that thepresent value of the Total Payments shall not exceed an amount equal to two andninety-nine hundredths (2.99) times the Executive’s Base Period Income, whichis the maximum amount which the Executive may receive without becoming subjectto the tax imposed by Section 4999 of the Code or which the Company maypay without loss of deduction under Section 280G(a) of the Code.  Present value for purposes of this Agreementshall be calculated in accordance with the regulations issued under Section 280Gof the Code.  Within sixty (60) daysfollowing delivery of the Notice of Termination or notice by the Company to theExecutive of its belief that there is a payment or benefit due the Executivewhich will result in an excess parachute payment as defined in Section 280Gof the Code, the Executive and the Company shall, at the Company’s expense,obtain such opinions as more fully described hereafter, which need not beunqualified, of legal counsel and certified public accountants or a firm ofrecognized executive compensation consultants. The Executive shall select said legal counsel, certified publicaccountants and executive compensation consultants; provided, however, that ifthe Company does not accept one (1) or more of the parties selected by theExecutive, the Company shall provide the Executive with the names of such legalcounsel, certified public accountants and/or executive compensation consultantsas the Company may select; provided, further, however, that if the Executivedoes not accept the party or parties selected by the Company, the legalcounsel, certified public accountants and/or executive compensation consultantsselected by the Executive and the Company, respectively, shall select the legalcounsel, certified public accountants and/or executive compensation consultants,whichever is applicable, who shall provide the opinions required by this Section 13(d).  The opinions required hereunder shall setforth (a) the amount of the Base Period Income of the Executive, (b) thepresent value of Total Payments and (c) the amount and present value of anyexcess parachute payments.  In the eventthat such opinions determine that there would be an excess parachute payment,the Termination Payment or any other payment determined by such counsel to beincludable in Total Payments shall be reduced or eliminated as specified by theExecutive in writing delivered to the Company within thirty (30) days of his orher receipt of such opinions or, if the Executive fails to so notify theCompany, then as the Company shall reasonably determine, so that under thebases of calculation set forth in such opinions there will be no excessparachute payment.  The provisions ofthis Section 13(d), including the calculations, notices and opinionsprovided for herein shall be based upon the conclusive presumption that thecompensation and other benefits, including but not limited to the Gross Income,earned on or after the date of a Change of Control by the Executive pursuant tothe Company’s compensation programs if such payments would have been made inthe future in any event, even though the timing of such payment is triggered bythe Change of Control, are reasonable compensation for services rendered priorto the Change of Control; provided, however, that in the event legal counsel sorequests in connection with the opinion required by this Section 13(d), afirm of recognized

 

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executive compensationconsultants, selected by the Executive and the Company pursuant to theprocedures set forth above, shall provide an opinion, upon which such legalcounsel may rely, as to the reasonableness of any item of compensation asreasonable compensation for services rendered prior to the Change of Control bythe Executive.  In the event that theprovisions of Sections 280G and 4999 of the Code are repealed withoutsuccession, this Section 13(d) shall be of no further force or effect.

 

(e)                                  TheTermination Payment shall be payable as follows:

 

(i)                                     Inthe event the Executive’s Termination Date is during a Change of ControlPeriod, any Termination Payment shall be paid to the Executive in a lump sumnot later than ten (10) days following the Executive’s Termination Date.  Such lump sum payment shall not be reduced byany present value, interest rate, or similar factor.  Further, the Executive shall not be requiredto mitigate the amount of such payment by securing other employment orotherwise and such payment shall not be reduced by reason of the Executivesecuring other employment or for any other reason.

 

(ii)                                  Inthe event the Executive’s Termination Date is prior to or after a Change ofControl Period, any Termination Payment shall be paid to the Executive in  equal installments on the Company’stwenty-six (26) regular bi-weekly paydays over the twelve-month period followingthe Termination Date.  Such paymentsshall not be reduced or increased by any present value, interest rate, orsimilar factor.  Further, the Executiveshall not be required to mitigate the amount of such payment by securing otheremployment or otherwise and such payment shall not be reduced by reason of theExecutive securing other employment or for any other reason.

 

(f)                                    Notwithstandinganything to the contrary herein, in no event will a termination of Executive’semployment with the Company be deemed to trigger a right to receive aTermination Payment if the termination is effected by the mutual agreement ofthe Company and Executive to accommodate a reassignment of Executive to anentity created or acquired by the Company, or to which the Company hascontributed rights to technology, assets or business plans, if at the time ofsuch termination the Company owns or is acquiring a minimum of a 19% equityinterest in such entity.  In the event ofany such termination, the Executive shall only be entitled to receive theExecutive’s Accrued Benefits as of the Termination Date.

 

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14.**                                **TERMINATIONNOTICE AND PROCEDURE.

 

Any termination by the Company or the Executive of the Executive’semployment during the employment period shall be communicated by written Noticeof Termination (“Notice of Termination”) to the Executive, if such Notice ofTermination is delivered by the Company, and to the Company, if such Notice ofTermination is delivered by the Executive, all in accordance with the followingprocedures:

 

(a)                                  TheNotice of Termination shall indicate the specific termination provision in thisAgreement relied upon and shall set forth in reasonable detail the facts andcircumstances alleged to provide a basis for termination;

 

(b)                                 AnyNotice of Termination by the Company shall be approved by a resolution dulyadopted by a majority of the Board, or a majority of the Board may delegatesuch authority to approve any Notice of Termination to the Chief Executive Officerof the Company;

 

(c)                                  Ifthe Executive shall in good faith furnish a Notice of Termination for GoodReason or for Good Reason During a Change of Control and the Company notifiesthe Executive that a dispute exists concerning the existence of Good Reason orGood Reason During a Change of Control, within the fifteen (15) day periodfollowing the Company’s receipt of such notice, the Executive shall continuethe Executive’s employment during such dispute. If it is thereafter determined that (i) Good Reason or Good ReasonDuring a Change of Control did exist, the Executive’s Termination Date shall bethe earlier of (A) the date on which the dispute is finally determined, eitherby mutual written agreement of the parties or pursuant to Section 16, (B)the date of the Executive’s death or (C) one day prior to the second (2nd)anniversary of a Change of Control, if any, and the Executive’s TerminationPayment, if applicable, shall reflect events occurring after the Executivedelivered the Executive’s Notice of Termination; or (ii) Good Reason orGood Reason During a Change of Control did not exist, the employment of theExecutive shall continue after such determination as if the Executive had notdelivered the Notice of Termination asserting Good Reason or Good Reason Duringa Change of Control; and

 

(d)                                 Ifthe Executive gives Notice of Termination of his or her employment for GoodReason or Good Reason During a Change of Control and a dispute arises as to theexistence of Good Reason or Good Reason During a Change of Control, and theExecutive does not continue his employment during such dispute, and it isfinally determined that the reason for termination set forth in such Notice ofTermination did not exist, if such notice was delivered by the Executive, the Executiveshall be deemed to have voluntarily terminated the Executive’s employment otherthan for Good Reason or Good Reason During a Change of Control.

 

15.**                                **NON-COMPETE.

 

The Executive hereby agrees that during the term of this Agreement andfor the period of one year****from thetermination hereof, that the Executive will not:

 

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(a)                                  Withinany jurisdiction or marketing area in the United States in which the Company orany subsidiary thereof is doing business, own, manage, operate or control anybusiness of the type and character engaged in and competitive with the Companyor any subsidiary thereof.  For purposesof this Section 15, ownership of securities of not in excess of fivepercent (5%) of any class of securities of a public company shall not beconsidered to be competition with the Company or any subsidiary thereof; or

 

(b)                                 Withinany jurisdiction or marketing area in the United States in which the Company orany subsidiary thereof is doing business, act as, or become employed as, anofficer, director, employee, consultant or agent of any business of the typeand character engaged in and competitive with the Company or any of itssubsidiaries; or

 

(c)                                  Solicitany similar business to that of the Company’s for, or sell any products thatare in competition with the Company’s products to, any company in the UnitedStates, which is, as of the date hereof or through the Termination Date, acustomer or client of the Company or any of its subsidiaries, or was such acustomer or client thereof within two years prior to the Termination Date; or

 

(d)                                 Solicitthe employment of (i) any employee of the Company or its subsidiaries that isan employee at anytime during this term of this Agreement or during the oneyear period following the termination of this Agreement, or (ii) any formeremployee of the Company or its subsidiaries who was employed by the Company orits subsidiaries during the one (1) year period preceding the Termination Date.

 

For purposes of this Section 15, any business inthe 3D visualization simulation market shall be deemed to be competitive withthe Company.

 

16.**                                **REMEDIESAND JURISDICTION.

 

(a)                                  TheExecutive hereby acknowledges and agrees that a breach of the agreementscontained in this Agreement will cause irreparable harm and damage to theCompany, that the remedy at law for the breach or threatened breach of theagreements set forth in this Agreement will be inadequate, and that, inaddition to all other remedies available to the Company for such breach orthreatened breach (including, without limitation, the right to recoverdamages), the Company shall be entitled to injunctive relief for any breach orthreatened breach of the agreements contained in this Agreement.  To enforce the provisions of this Section 16(a),the Company may seek relief from any court with proper jurisdiction and theprovisions of Section 16(b)-(d) shall not be applicable for purposes ofthis Section 16(a).

 

(b)                                 Allclaims, disputes and other matters in question between the parties arisingunder this Agreement, shall, unless otherwise provided herein, be decided bybinding arbitration before a single independent arbitrator selected pursuant toSection 16(d).  TO THE EXTENTALLOWABLE UNDER APPLICABLE LAW, ALL DISPUTES INVOLVING ALLEGED UNLAWFULEMPLOYMENT DISCRIMINATION, BREACH OF CONTRACT OR POLICY, OR EMPLOYMENT TORTCOMMITTED BY THE COMPANY OR A REPRESENTATIVE OF THE

 

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COMPANY, INCLUDING CLAIMSOF VIOLATIONS OF FEDERAL OR STATE DISCRIMINATION STATUTES OR PUBLIC POLICY,SHALL BE RESOLVED PURSUANT TO THIS POLICY AND THERE SHALL BE NO RECOURSE TOCOURT, WITH OR WITHOUT A JURY TRIAL.  Thearbitration hearing shall occur at a time and place convenient to the partiesin Salt Lake County, Utah, within thirty (30) days of selection or appointmentof the arbitrator.  If the Company hasadopted a policy that is applicable to arbitration with employees, thearbitration shall be conducted in accordance with said policy to the extentthat the policy is consistent with this Agreement and the Federal ArbitrationAct, 9 U.S.C. §§ 1-16.  If no suchpolicy has been adopted, the arbitration shall be governed by the NationalRules for the Resolution of Employment Disputes of AAA in effect on the date ofthe first notice of demand for arbitration. The arbitrator shall issue written findings of fact and conclusions oflaw, and an award, within fifteen (15) days of the date of the hearing unlessthe parties otherwise agree.

 

(c)                                  Incases of breach of contract or policy, damages shall be limited to contractdamages.  In cases of discriminationclaims prohibited by statute, the arbitrator may direct payment consistent withthe applicable statute.  Issues ofprocedure, arbitrability, or confirmation of award shall be governed by theFederal Arbitration Act, 9 U.S.C. §§ 1-16, except that court review of thearbitrator’s award shall be that of an appellate court reviewing a decision ofa trial judge sitting without a jury.

 

(d)                                 Theparties shall select the arbitrator from a panel list made available by theAAA.  If the parties are unable to agreeto an arbitrator within ten (10) days of receipt of a demand for arbitration,the arbitrator will be chosen by alternatively striking from a list of five (5)arbitrators obtained by the Company from AAA. The Executive shall have the first strike.

 

17.**                                **ATTORNEYS’FEES.

 

In the event that either party hereunder institutes any legalproceedings in connection with its rights or obligations under this Agreement,each party in such proceeding shall be responsible for all of its own costsincurred in connection with such proceeding, including attorneys’ fees and anyother fees, expenses, or costs.

 

18.**                                **SUCCESSORS.

 

This Agreement and all rights of the Executive shall inure to thebenefit of and be enforceable by the Executive’s personal or legalrepresentatives, estates, executors, administrators, heirs andbeneficiaries.  In the event of theExecutive’s death, all amounts payable to the Executive under this Agreementshall be paid to the Executive’s surviving spouse, or the Executive’s estate ifthe Executive dies without a surviving spouse. This Agreement shall inure to the benefit of, be binding upon and beenforceable by, any successor, surviving or resulting corporation or otherentity to which all or substantially all of the business and assets of theCompany shall be transferred whether by merger, consolidation, transfer orsale.

 

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19.**                                **ENFORCEMENT.

 

The provisions of this Agreement shall be regarded as divisible, and ifany of said provisions or any part hereof are declared invalid or unenforceableby a court of competent jurisdiction, the validity and enforceability of theremainder of such provisions or parts hereof and the applicability thereofshall not be affected thereby.

 

20.**                                **AMENDMENTOR TERMINATION.

 

This Agreement may not be amended or terminated during its term, exceptby written instrument executed by the Company and the Executive.

 

21.**                                **SURVIVABILITY.

 

The provisions of Sections 15, 16, 17, 18 and 19 shall survivetermination of this Agreement.

 

22.**                                **ENTIREAGREEMENT.

 

Except for the Confidentiality, Proprietary Information, and InventionsAgreement between the Executive and the Company, this Agreement sets forth theentire agreement between the Executive and the Company with respect to thesubject matter hereof, and supersedes all prior oral or written agreements,negotiations, commitments and understandings with respect thereto.** **Prior EmploymentAgreements between the Executive and the Company are hereby terminated in theirentirety and superceded by this Agreement.

 

23.**                                **VENUE;GOVERNING LAW.

 

This Agreement and the Executive’s and Company’s respective rights andobligations hereunder shall be governed by and construed in accordance with thelaws of the State of Utah without giving effect to the provisions, principles,or policies thereof relating to choice or conflicts of laws.

 

24.**                                **NOTICE.

 

All notices,requests, instructions or other documents to be given under this Agreementshall be in writing and shall be deemed given (i) three business days followingsending by registered or certified mail, postage prepaid, (ii) when sent ifsent by facsimile; provided, however, that the facsimile is promptly confirmedby telephone confirmation thereof, (iii) when delivered, if deliveredpersonally to the intended recipient, and (iv) one business day followingsending by overnight delivery via a national courier service, and in each case,addressed to a party at the following address for such party:

 

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| Company:   |   | Evans & Sutherland  Computer Corporation                                                                                        |
|------------|--------|-------------------------------------------------------------------------------------------------------------------------------------|
|       |   | 600 Komas Drive                                                                                                                     |
|       |   | Salt Lake City, Utah  84108                                                                                                         |
|       |   | Attn: Vice President of  Human Resources                                                                                            |
|       |   | Fax: (801) 588-4517                                                                                                                 |
|       |   | Tel: (801) 588-1609                                                                                                                 |
|       |   |                                                                                                                                |
|       |   |                                                                                                                                |
| Executive: |   | Kirk D. Johnson                                                                                                                     |
|       |   | 2542 Kentucky Ave                                                                                                                   |
|       |   | Salt Lake City, Utah  84117                                                                                                         |
|       |   |                                                                                                                                |
|       |   | Fax:  (      )        -         |
|       |   | Tel: (801) 277-7103                                                                                                                 |

 

or to such other address as the Company shall havegiven to the Executive or, if to the Executive, to such address as theExecutive shall have given to the Company or facsimile number as the party towhom notice is given may have previously furnished to the other in writing inthe manner set forth above.

 

25.**                                **NOWAIVER.

 

No waiver by either party at any time of any breach by the other partyof, or compliance with, any condition or provision of this Agreement to beperformed by the other party shall be deemed a waiver of similar or dissimilarprovisions or conditions at the same time or any prior or subsequent time.

 

26.**                                **HEADINGS.

 

The headings herein contained are for reference only and shall notaffect the meaning or interpretation of any provision of this Agreement.

 

27.**                                **COUNTERPARTS.

 

This Agreement may be executed in one or more counterparts, each ofwhich shall be deemed to be an original but all of which together willconstitute one and the same instrument.

 

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IN WITNESS WHEREOF, the Company has caused this Agreement to beexecuted by its duly authorized officer, and the Executive has executed thisAgreement, on the date and year first above written.

 
| ** ** | ** ** | **“COMPANY”**                                              |
|------------|------------|----------------------------------------------------------------------|
| ** ** | ** ** | ** **                                                           |
| ** ** | ** ** | ** **                                                           |
| ** ** | ** ** | EVANS & SUTHERLAND  COMPUTER****CORPORATION, a Utah  Corporation |
|       |       |
|       |       |                                                                 |
|       |       |                                                                 |
|       |       | By:                                                                  | /s/ James R. Oyler |   |
|       |       |                                                                 | James R. Oyler |
|       |       |                                                                 | President and Chief Executive Officer |
|       |       |                                                                 |
|       |       |                                                                 |
| ** ** | ** ** | **“EXECUTIVE”**                                            |
| ** ** | ** ** | ** **                                                           |
| ** ** | ** ** | ** **                                                           |
|       |       | /s/  Kirk Johnson                                                    |   |
| ** ** | ** ** | ** **                                                           | **Kirk D. Johnson** |
|            |            |                                                                      |  |  |  |  |  |

** **

** **

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