Document:

f8k112208ex10ii_chinavalves.htm

     

     

    
      

      Exhibit
10.2

       

       

      

      CHINA
VALVES TECHNOLOGY, INC.

      INDEPENDENT
DIRECTOR AGREEMENT WITH WILLIAM HAUS

      

       China Valves Technology,
Inc

       

      Nov 22,
2008

      Dear Mr.
Bill Haus,

       

      Re.: Independent
directorship

       

      We are
writing to confirm your appointment as an independent director of China Valves
Technology, Inc. (the “Company”), which is listed on
the OTCBB under CVVT.OB.

       

      Following
your acceptance, your appointment will be effective as of Dec 01, 2008. You are
entitled to a monthly director’s fee of US$1,000, or its RMB equivalent. Your
monthly fee will be payable monthly. In addition,  you will be granted
10,000 shares of Restricted Common Stock, this Restricted Stock Grant will be
returned to the company should Bill Haus voluntary resign within 18 months. Your
grant date will be Dec 01, 2008. This Restricted Common Stock will be subject to
a lock-up agreement of 30 months in which it cannot be sold or
transferred.  Finally, the company will pay for customary reimbursable
items including one visit per year to the company’s headquarters
facility.

       

      You
hereby agree to maintain the confidentiality of the confidential information and
trade secrets of the Company, including but not limited to, any confidential
information and statistics, business plans, operations, technologies, know-how,
systems and/or the proposed sale, purchase and use of services and products
furnished in oral, visual, written and/or other tangible form and not to
disclose such information to any third party without the prior consent of the
Company.

       

      Please
confirm your acceptance of the appointment as an independent director of the
Company by signing, dating and returning to us the attached copy of this
letter.

       

      Yours
faithfully

       

      /s/ Siping
Fang            

      Fang
Siping

      Chairman
of the Board

       

      I hereby
confirm my acceptance to act as an independent director of the Company upon the
terms contained in this letter.

       

      /s/ William
Haus          

      William
Haus

       

      Date: Nov
22, 2008EX-10.6

EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (the “Agreement”) is entered into and is effective as of
November 20, 2008, by and between Robert Beauchamp, an individual resident of Sugarland, Texas (the
“Executive”) and BMC Software, Inc., a Delaware corporation (the “Employer”). The Employer and
Executive are each a “party” and are together “parties” to this Agreement.

BACKGROUND

The Employer and the Executive previously entered into that certain employment agreement dated
January 5, 2001, and last amended on January 31, 2004 (the “Prior Employment Agreement”). The
Employer and the Executive now desire to amend and restate the Prior Employment Agreement to
reflect necessary changes for the Agreement to comply with Code Section 409A and to make certain
other changes.

AGREEMENT

In consideration of the employment compensation to be paid to Executive and other good and
valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties,
intending to be legally bound, agree as follows:

1. DEFINITIONS.

For the purposes of this Agreement, the following terms have the meanings specified or
referred to in this Section 1.

“Affiliate” means a person or entity that directly or indirectly controls, is controlled by,
or is under common control with, the Employer.

“Agreement” refers to this Executive Employment Agreement, including all Exhibits attached
hereto, as amended from time to time.

“Base Salary” as defined in Section 3.1.

“Benefits” as defined in Section 3.3.

“Board of Directors” or “Board” refers to the board of directors of the Employer.

“Cause” as defined in Section 6.3(a).

“Change of Control” means the occurrence of one or more of the following events:

(a) the acquisition, directly or indirectly, by any person or related group of persons
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”) of beneficial ownership (within the meaning of Rule 13d-3 of
the Exchange Act) of securities possessing at least fifty percent (50%) of the total
combined voting power of the Employer’s outstanding securities;

(b) a change in the composition of the Board of Directors such that a majority of the
Board members ceases by reason of one or more contested elections for Board membership to be
comprised of individuals who either (i) are Board members as of the Effective Date (the
“Incumbent Directors”) or (ii) after the Effective Date, are elected or nominated for
election as Board members by at least a majority of the Incumbent Directors who are still in
office at the time such election or nomination is approved by the Board (such individuals
will also be considered “Incumbent Directors” upon election to the Board), but excluding for
purposes of clauses (i) and (ii) any such individual whose initial assumption of office
occurs as a result of an actual or threatened election contest (within the meaning of Rule
14a-11 of the Exchange Act) with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a Person other
than the Board of Directors;

(c) a merger, consolidation, or similar corporate transaction in which the Employer’s
shareholders immediately prior to the transaction do not own more than sixty percent (60%)
of the voting stock of the surviving corporation in the transaction;

(d) shareholder approval of the Employer’s liquidation, dissolution, or sale of
substantially all of its assets; or

(e) if Executive’s primary employment duties are with a subsidiary, division or
business unit of the Employer, the sale, merger, contribution, transfer or any other
transaction in conjunction with which the Employer’s ownership interest in the subsidiary,
division or business unit decreases below a majority interest.

“Confidential Information” means any and all:

(a) Trade Secrets (as defined herein) concerning the business and affairs of the
Employer, product specifications, data, know-how, formulae, compositions, processes,
designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past,
current, and planned research and development, current and anticipated customer
requirements, price lists, market studies, business plans, computer software and programs
(including object code and source code), computer software and database technologies,
systems, structures, and architectures (and related formulae, compositions, processes,
improvements, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods
and information), and any other information, however documented, that is a trade secret;

(b) information which has value in the Employer’s business and which the Employer takes
reasonable steps to keep confidential; this consists of information concerning the business
and affairs of the Employer, such as, historical financial statements, financial projections
and budgets, historical and projected sales, capital spending budgets and plans, marketing
and sales plans, business plans, the names and backgrounds of key personnel, personnel
training and techniques and materials, however documented; and

(c) notes, analysis, compilations, studies, summaries, and other material prepared by
or for the Employer containing or based, in whole or in part, on any information included in
the foregoing.

“Disability” as defined in Section 6.2.

“Effective Date” is the date stated in the first paragraph of the Agreement.

“Employee Invention” shall mean any idea, invention, technique, modification, process, or
improvement (whether patentable or not), any industrial design (whether registerable or not), any
mask work, however fixed or encoded, that is suitable to be fixed, embedded or programmed in a
semiconductor product (whether recordable or not), and any work of authorship (whether or not
copyright protection may be obtained for it) created, conceived, or developed by Executive, either
solely or in conjunction with others, during the Employment Period, or a period that includes a
portion of the Employment Period, that relates in any reasonable way to, or is useful in any manner
in, the business then being conducted or proposed to be conducted by the Employer, and any such
item created by Executive, either solely or in conjunction with others, following termination of
Executive’s employment with the Employer, that is based upon or uses Confidential Information.

“Employer Group” shall mean the Employer and any other corporation or trade or business
required to be aggregated with the Employer which constitutes a single employer under Code Section
414(b) or Code Section 414(c) with the Employer, except that in applying Code Section 1563(a)(1),
(2), and (3), the language “at least 50 percent” is used instead of “at least 80 percent”.

“Employment Period” as is the term of the Executive’s employment under this Agreement.

“Fiscal Year” shall mean the Employer’s fiscal year, which shall end on March 31 of each
calendar year, or as changed from time to time.

“Good Reason” as defined in Section 6.3(b).

“Person” is any individual, corporation (including any non-profit corporation), general or
limited partnership, limited liability company, joint venture, estate, trust, association,
organization, or governmental body.

“Proprietary Items” as defined in Section 7.2(a)(iv).

“Separation from Service” shall mean the Executive’s termination of employment with the
Employer Group for any reason which constitutes a “separation from service” under Code Section
409A. Notwithstanding the foregoing, the Executive’s employment relationship with the Employer
Group is considered to remain intact while the individual is on military leave, sick leave or other
bona fide leave of absence if there is a reasonable expectation that the Executive will return to
perform services for the Employer Group and the period of such leave does not exceed six months, or
if longer, so long as the Executive retains a right to reemployment with the Employer under
applicable law or contract. Solely for purposes of determining whether a Separation from Service
has occurred, the Employer will determine whether the Executive has terminated employment with the
Employer Group based on whether it is reasonably anticipated by the Employer and the Executive that
the Executive will permanently cease providing services to the Employer Group, whether as an
employee or independent contractor, or that the services to be performed by the Executive, whether
as an employee or independent contractor, will permanently decrease to no more than 20% of the
average level of bona fide services performed, whether as an employee or independent contractor,
over the immediately preceding 36-month period or such shorter period during which the Executive
was performing services for the Employer Group. If a leave of absence occurs during such 36-month
or shorter period which is not considered a Separation from Service, unpaid leaves of absence shall
be disregarded and the level of services provided during any paid leave of absence shall be
presumed to be the level of services required to receive the compensation paid with respect to such
leave of absence.

“Trade Secrets” shall mean the whole or any part of any scientific or technical information,
design, process, procedure, formula, or improvement that has value and that the owner has taken
measures to prevent from becoming available to persons other than those selected by the owner to
have access for limited purposes.

2. EMPLOYMENT TERMS AND DUTIES.

2.1 EMPLOYMENT

Employer hereby employs Executive, and the Executive hereby accepts employment by the
Employer, upon the terms and conditions set forth in this Agreement.

2.2 POSITION

Executive shall hold the position of Chief Executive Officer. Executive shall report directly
to the Board of Directors. The Employer will also recommend, and take all reasonable steps to
ensure, that Executive is elected to the Board of Directors.

2.3 EMPLOYMENT PERIOD

Subject to the provisions of Section 6, the term of the Executive’s employment under this
Agreement will commence upon the Effective Date and shall continue in effect through the third
anniversary of the Effective Date (the “Employment Period”); provided, however, that, subject to
the provisions of Section 6, commencing on the day following the Effective Date and on each day
thereafter, the Employment Period shall be automatically extended for one additional day unless the
Employer shall give written notice to Executive that the Employment Period shall cease to be so
extended, in which event the Employment Period shall terminate on the third anniversary of the date
such notice is given.

2.4 DUTIES

Executive will have such duties as are typically performed by the chief executive officer of
any company, including those assigned or delegated to Executive by the Board of Directors.
Executive shall devote his entire business time, attention, skill, and energy exclusively to the
business of the Employer, will use his reasonable best efforts to promote the success of the
Employer’s business, and will cooperate fully with the Board of Directors in the advancement of the
best interests of the Employer. Executive’s employment will be subject to the policies maintained
and established by the Employer from time to time. Executive will not render commercial or
professional services of any nature to any person or organization, whether or not for compensation,
during his employment with the Employer without advance written approval of the Employer’s Board of
Directors, which will not be unreasonably withheld or delayed, and Executive will not directly or
indirectly engage or participate during the Employment Period in any business that is competitive
in any manner with the business of the Employer; provided, however, that nothing in this Section
2.4 will prevent Executive (i) from engaging in additional activities in connection with passive
personal investments and community affairs that are not inconsistent with Executive’s duties under
this Agreement; (ii) from serving on the boards of directors of other companies or organizations,
or engaging in other activities, so long as such participation does not conflict with the interests
or business of the Employer or require such involvement as to interfere with the performance of
Executive’s duties hereunder. If Executive is elected as a director of the Employer or as a
director or officer of any of its Affiliates, Executive will fulfill his duties as such director or
officer without additional compensation. Executive acknowledges and agrees that he owes a fiduciary
duty of loyalty, fidelity and allegiance to act at all times in the best interests of the Employer.

2.5 PERFORMANCE REVIEW

Executive’s performance will be reviewed from time to time by the Board of Directors.

3. COMPENSATION

3.1 BASE SALARY

During the Employment Period, the Employer shall pay Executive an annual base salary in the
amount of Nine Hundred Fifty Thousand Dollars ($950,000), less applicable taxes and withholdings,
payable in accordance with the Employer’s standard payroll practices and procedure. Executive’s
base salary shall be reviewed at least annually and, if deemed appropriate by the Compensation
Committee of the Board of Directors in its sole discretion, shall be increased from time to time.
(The annual base salary specified in this Section 3.1, together with any changes to such
compensation that the Employer may make from time to time, are referred to in this Agreement as the
“Base Salary.”)

3.2 CASH BONUS

Executive will be eligible for a cash bonus as described in Exhibit B incorporated herein by
reference and such other bonus programs as may be authorized by the Compensation Committee and the
Board of Directors of Employer.

3.3 BENEFITS

The Executive will, during the Employment Period, be permitted to participate in such pension,
profit sharing, life insurance, hospitalization, major medical, and other employee benefit plans of
the Employer that may be in effect from time to time, to the extent Executive is eligible under the
terms of those plans (collectively, the “Benefits”).

3.4 EQUITY

(a) Awards. Executive will be entitled to receive awards granted by the
Compensation Committee of the Board of Directors pursuant to any equity program or long-term
incentive plan that may be maintained by the Employer from time to time. Executive’s rights
respecting any awards granted to the Executive prior to the Effective Date pursuant to any
such equity program or long-term incentive plan maintained by the Employer shall continue
under the terms of the awards and the applicable plans or programs under which the awards
were granted.

(b) Amendment of Certain Outstanding Stock Options. Each Out-of-the-Money
Option (as hereinafter defined) is hereby amended to provide that, at any time and from time
to time prior to the termination of such option, the Executive may surrender all or a
portion of such option to the Employer for no consideration by providing written notice to
the Employer at its principal executive office addressed to the attention of the President
or the Treasurer. Such notice shall specify the number of shares with respect to which the
Out-of-the-Money Option is being surrendered and, if such option is being surrendered with
respect to less than all of the shares then subject to such option, then such notice shall
also specify the date upon which such option became (or would become) exercisable in
accordance with the terms thereof with respect to the shares being surrendered. The term
“Out-of-the-Money Option” means each stock option granted to the Executive by the Employer
prior to January 31, 2004 (the “Option Date”) with respect to which the purchase price per
share of common stock of the Employer under such option (as adjusted through the Option
Date) is greater than the fair market value of a share of common stock of the Employer
(determined under the plan pursuant to which such option was granted) as of the Option Date.
The provisions of this Section 3.4(b) shall survive the termination of this Agreement.

4. FACILITIES AND EXPENSES

4.1 FACILITIES

During the Employment Period, the Employer will furnish Executive office space, equipment,
supplies, and such other facilities and personnel as the Employer deems reasonably necessary or
appropriate for the performance of Executive’s duties under this Agreement.

4.2 EXPENSES

The Employer will pay on behalf of Executive (or reimburse Executive in a timely manner for)
reasonable expenses incurred by Executive at the request of, or on behalf of, the Employer in the
performance of Executive’s duties pursuant to this Agreement, and in accordance with the Employer’s
employment policies, including reasonable expenses incurred by Executive in attending business
meetings, in appropriate business entertainment activities, and for promotional expenses. Executive
must file expense reports with respect to such expenses in accordance with the Employer’s policies
then in effect.

4.3 TIMING

All in-kind benefits provided and expenses eligible for reimbursement under this Section 4
must be provided by the Employer or incurred by the Executive during the term of this Agreement.
All reimbursements shall be paid as soon as administratively practicable, but in no event shall any
reimbursement be paid after the last day of the taxable year following the taxable year in which
the expense was incurred. The amount of in-kind benefits provided or reimbursable expenses
incurred in one taxable year shall not affect the in-kind benefits to be provided or the expenses
eligible for reimbursement in any other taxable year. Such right to reimbursement or in-kind
benefits is not subject to liquidation or exchange for another benefit.

5. VACATIONS AND HOLIDAYS

Executive will be entitled to paid vacation during the Employment Period in accordance with
the vacation policies of the Employer in effect for its employees from time to time. Executive will
also be entitled to the paid holidays and other paid leave set forth in the Employer’s policies.

6. TERMINATION

6.1 EVENTS OF TERMINATION

Executive’s employment, the Employment Period, the Base Salary, and any and all other rights
of Executive under this Agreement or otherwise as an employee of the Employer will terminate
(except as otherwise provided in this Section 6):

(a) upon the death of the Executive;

(b) upon termination of employment due to the Disability of the Executive;

(c) upon termination by the Employer for Cause;

(d) upon resignation of employment by the Executive without Good Reason;

(e) upon termination by the Employer without Cause;

(f) upon the resignation of employment by Executive for Good Reason.

Upon termination of Executive’s employment, as provided above or otherwise, Executive’s rights
respecting benefits, stock options, restricted stock, and other equity awards will be determined
under the applicable plan or program providing the same.

6.2 DEFINITION OF DISABILITY

For purposes hereof, the term “Disability” shall mean an incapacity by accident, illness or
other circumstances which renders Executive mentally or physically incapable of performing the
duties and services required of Executive hereunder on a full-time basis for a period of at least
120 consecutive days, or 180 days during any twelve-month period. Upon the occurrence of
Disability, the Employer may then terminate Executive’s employment due to Disability by providing
written notice to Executive of such termination of employment. Nothing herein shall be interpreted
as preventing the Employer from terminating Executive’s employment for any other reason or at any
time.

6.3 DEFINITION OF “CAUSE” AND “GOOD REASON”

(a) Definition of “Cause”. For all purposes under this Agreement, “Cause”
shall mean the occurrence of any one or more of the following events:

(i) Executive’s continued and material failure to perform satisfactorily his
work duties after receipt of a written warning and at least thirty (30) days to
improve;

(ii) Executive’s material violation of any Employer policy or code of conduct;

(iii) the appropriation (or attempted appropriation) of a material business
opportunity of the Employer without first presenting it to the Employer in writing
and giving it a reasonable opportunity to accept or reject such opportunity,
including attempting to secure or securing any personal profit in connection with
any transaction entered into on behalf of the Employer;

(iv) Executive’s engaging in conduct that is materially injurious to the
Employer;

(v) the misappropriation (or attempted misappropriation) of any of the
Employer’s funds or property;

(vi) the conviction of, the indictment for (or its procedural equivalent), or
the entering of a guilty plea or plea of no contest with respect to, a felony, the
equivalent thereof, or any other crime with respect to which imprisonment is a
punishment; or

(vii) the conviction of Executive by a court of competent jurisdiction of a
crime involving moral turpitude.

The determination of whether the Executive’s employment is terminable for Cause
shall be made solely by the Employer, which shall act in good faith in making such
determination. A termination of Executive’s employment by the Employer for any other
reason or in any other circumstances, except due to Disability, will be a
termination “without Cause.”

(b) Definition of “Good Reason”. For all purposes under this Agreement, “Good
Reason” shall mean the occurrence of one or more of the following events arising without the
express written consent of the Executive, but only if the Executive notifies the Employer in
writing of the event within sixty (60) days following the occurrence of the event, the event
remains uncured after the expiration of thirty (30) days from receipt of such notice, and
the Executive resigns effective no later than thirty (30) days following the Employer’s
failure to cure the event:

(i) a material diminution in the Executive’s Base Salary;

(ii) a material diminution in the Executive’s authority, duties, or
responsibilities;

(iii) a material diminution in the authority, duties, or responsibilities of
the supervisor to whom the Executive is required to report, including a requirement
that the Executive report to a corporate officer or employee instead of reporting
directly to the board of directors of the Employer;

(iv) a material diminution in the budget over which the Executive retains
authority;

(v) the Employer or a subsidiary thereof requiring the Executive to be
permanently based anywhere other than within fifty (50) miles of the Executive’s job
location immediately prior to the reassignment;

(vi) any other action that constitutes a material breach by the Employer of the
Agreement; or

(vii) the occurrence of one or more of the following events that results in a
material negative change in the Executive’s employment relationship with the
Employer:

(A) a reduction in the Executive’s Target Bonus from that provided to
him immediately on the Effective Date of this Agreement or as the same may
be increased from time to time; or

(B) the Executive ceasing to be the highest ranking officer of the
Employer.

A resignation of employment by Executive for any other reason or under any other
circumstances will be a resignation “without Good Reason.”

6.4 SEVERANCE

Should Executive’s employment with the Employer be terminated by the Employer Without Cause or
should Executive resign his employment with the Employer for Good Reason, then, subject to
Executive executing, and failing to revoke during any applicable revocation period, the Severance
Agreement and General Release attached as Exhibit A to this Agreement within forty-five (45) days
after Executive’s termination of employment, the Employer will provide to Executive the following:

(i) a lump sum payment equal to two (2) times his Base Salary; and

(ii) a lump sum payment equal to two (2) times his then current cash bonus target
amount.

Subject to Section 6.7, such lump sum payments under this Section 6.4 will be made no later
than sixty (60) days following the Executive’s Separation from Service on or after the date the
Executive’s employment is terminated. Severance payments do not result in extending employment
beyond the termination date.

6.5 CHANGE OF CONTROL

(a) If, within 12 months after a Change of Control, Executive’s position is terminated
by the Employer without Cause or Executive resigns his employment for Good Reason, then,
subject to Executive executing, and failing to revoke during any applicable revocation
period, the Severance Agreement and General Release attached as Exhibit A to this Agreement
within forty-five (45) days after Executive’s termination of employment, the Executive shall
be entitled to the following in lieu of the amounts set forth in Section 6.3:

(i) a lump sum payment equal to two (2) times his Base Salary;

(ii) a lump sum payment equal to two times his then current cash bonus target
amount; and

(iii) a lump sum payment equal to the cost of COBRA coverage for eighteen (18)
months for continued medical benefits for the Executive and his dependents
(including his spouse) who were covered as of such termination event under the
medical benefit plan as in effect for employees of the Employer during the coverage
period, or the substantial equivalence.

Subject to Section 6.7, such lump sum payments under this Section 6.5 will be made no
later than sixty (60) days following the Executive’s Separation from Service on or after the
date the Executive’s employment is terminated. Upon Executive’s execution and delivery of
Exhibit A, a Company representative will execute and deliver to Executive Exhibit A,
assuming the requirements of this Agreement have been met. Severance payments do not result
in extending employment beyond the termination date.

(b) Notwithstanding anything to the contrary in this Agreement, if the Executive is a
“disqualified individual” (as defined in Section 280G(c) of the Internal Revenue Code of
1986, as amended (the “Code”)), and the severance benefits provided for in this Section 6.5,
together with any other payments and benefits which the Executive has the right to receive
from the Employer and its Affiliates (the “Aggregate Severance”), would be subject to the
excise tax imposed by Section 4999 of the Code, including any interest and penalties imposed
with respect to such excise tax (the “Excise Tax”), then the Executive shall be entitled to
receive an additional payment (the “Gross-Up Payment”) in an amount such that, after payment
by the Executive of all taxes (and any interest or penalties imposed with respect to such
taxes) including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, the
Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the
Aggregate Severance. Any Gross-Up Payment shall be paid by the Employer to the Executive or
the applicable taxing authorities on or before the date in which such taxes are due, but,
for purposes of Section 409A of the Code, in all events by the end of the Executive’s
taxable year following the Executive’s taxable year in which the Executive remits the
related taxes.

Notwithstanding the foregoing, if it shall be determined that the Executive is entitled
to the Gross-Up Payment, but that the Aggregate Severance does not exceed one hundred and
ten percent (110%) of the Safe Harbor Amount (as defined below), then no Gross-Up Payment
shall be made to the Executive and the amounts payable under this Agreement shall be reduced
so that the Aggregate Severance equals the Safe Harbor Amount. The reduction of the amounts
payable hereunder, if applicable, shall be made by first reducing the cash payments pursuant
to this Section, and in any event shall be made in such a manner as to maximize the value of
the Aggregate Severance actually paid to the Executive.

The determination as to whether the Executive is entitled to a Gross-Up Payment or any
such reduction in the Aggregate Severance is necessary shall be made initially by the
Employer in good faith.

For purposes of this Section “Safe Harbor Amount” means an amount equal to one dollar
($1.00) less than three (3) times the Executive’s “base amount” for the “base period,” as
those terms are defined under Section 280G of the Code.

(c) The Executive shall notify the Employer in writing of any claim by the Internal
Revenue Service that, if successful, would require the payment by the Employer of the
Gross-Up Payment. Such notification shall be given as soon as practicable, but no later
than ten (10) business days after the Executive is informed in writing of such claim. The
Executive shall apprise the Employer of the nature of such claim and the date on which such
claim is requested to be paid. The Executive shall not pay such claim prior to the
expiration of the thirty (30) day period following the date on which the Executive gives
such notice to the Employer (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due). If the Employer notifies the Executive in writing
prior to the expiration of such period that the Employer desires to contest such claim, the
Executive shall:

(i) give the Employer any information reasonably requested by the Employer
relating to such claim,

(ii) take such action in connection with contesting such claim as the Employer
shall reasonably request in writing from time to time, including, without
limitation, accepting legal representation with respect to such claim by an attorney
reasonably selected by the Employer,

(iii) cooperate with the Employer in good faith in order to effectively contest
such claim, and

(iv) permit the Employer to participate in any proceedings relating to such
claim;

provided, however, that the Employer shall bear and pay directly all costs and expenses
(including additional interest and penalties) incurred in connection with such contest, and
shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax
or income tax (including interest and penalties) imposed as a result of such representation
and payment of costs and expenses. Without limitation on the foregoing provisions of this
Section (c), the Employer shall control all proceedings taken in connection with such
contest, and, at its sole discretion, may pursue or forgo any and all administrative
appeals, proceedings, hearings and conferences with the applicable taxing authority in
respect of such claim and may, at its sole discretion, either direct the Executive to pay
the tax claimed and sue for a refund or contest the claim in any permissible manner, and the
Executive agrees to prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the
Employer shall determine; provided, however, that if the Employer directs the Executive to
pay such claim and sue for a refund, the Employer shall advance the amount of such payment
to the Executive, on an interest-free basis, and shall indemnify and hold the Executive
harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or
penalties) imposed with respect to such advance or with respect to any imputed income in
connection with such advance; and provided, further, that any extension of the statute of
limitations relating to payment of taxes for the taxable year of the Executive with respect
to which such contested amount is claimed to be due is limited solely to such contested
amount. Furthermore, the Employer’s control of the contest shall be limited to issues with
respect to which the Gross-Up Payment would be payable hereunder, and the Executive shall be
entitled to settle or contest, as the case may be, any other issue raised by the Internal
Revenue Service or any other taxing authority.

(d) If, after the receipt by the Executive of a Gross-Up Payment or an amount advanced
by the Employer pursuant to Section (c) hereof, the Executive becomes entitled to receive
any refund with respect to the Excise Tax to which such Gross-Up Payment relates or with
respect to such claim, the Executive shall (subject to the Employer’s complying with the
requirements of Section (c) hereof, if applicable) promptly pay to the Employer the amount
of such refund (together with any interest paid or credited thereon after taxes applicable
thereto). If, after the receipt by the Executive of an amount advanced by the Employer
pursuant to Section (c) hereof, a determination is made that the Executive shall not be
entitled to any refund with respect to such claim and the Employer does not notify the
Executive in writing of its intent to contest such denial of refund prior to the expiration
of thirty (30) days after such determination, then such advance shall be forgiven and shall
not be required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.

(e) Notwithstanding any other provision of this Section 6.5, the Employer may, in its
sole discretion, withhold and pay over to the Internal Revenue Service or any other
applicable taxing authority, for the benefit of the Executive, all or any portion of any
Gross-Up Payment, and the Executive hereby consents to such withholding.

6.6 NO MITIGATION

Any remuneration received by Executive from a third party following the Employment Period
shall not apply to reduce the Employer’s obligations to make payments hereunder.

6.7 CODE SECTION 409A

Notwithstanding any provision to the contrary in this Agreement, if the Executive is deemed at
the time of his Separation from Service from the Employer to be a “specified employee” for purposes
of Section 409A(a)(2)(B)(i) of the Code and if any amounts otherwise payable pursuant to this
Agreement within the first six (6) months following the Executive’s Separation from Service would
be subject to the excise tax imposed by Section 409A of the Code, then payment of such portion of
the benefits subject to the excise tax shall be suspended and shall be paid in a lump sum to the
Executive on the first business day following the expiration of six (6) months from the date of the
Executive’s Separation from Service.

7. NON-DISCLOSURE COVENANT; EMPLOYEE INVENTIONS

7.1 ACKNOWLEDGMENTS BY EXECUTIVE

The Executive acknowledges that (a) prior to and during the Employment Period and as a part of
his employment, Executive has been and will be afforded access to Confidential Information; (b)
public disclosure of such Confidential Information could have an adverse effect on the Employer and
its business; (c) because Executive possesses substantial technical expertise and skill with
respect to the Employer’s business, the Employer desires to obtain exclusive ownership of each
Employee Invention, and the Employer will be at a substantial competitive disadvantage if it fails
to acquire exclusive ownership of each Employee Invention; and (d) the provisions of this Section 7
are reasonable and necessary to prevent the improper use or disclosure of Confidential Information
and to provide the Employer with exclusive ownership of all Employee Inventions.

7.2 AGREEMENTS OF THE EXECUTIVE

In consideration of the compensation and benefits to be paid or provided to Executive by the
Employer under this Agreement, the Executive covenants the following:

(a) Confidentiality.

(i) Executive will hold in confidence the Confidential Information and will not
disclose it to any person except with the specific prior written consent of the
Employer or except as otherwise expressly permitted by the terms of this Agreement.

(ii) Any Trade Secrets of the Employer will be entitled to all of the
protections and benefits under any applicable law. If any information that the
Employer deems to be a trade secret is found by a court of competent jurisdiction
not to be a trade secret for purposes of this Agreement, such information will,
nevertheless, be considered Confidential Information for purposes of this Agreement.
Executive hereby waives any requirement that the Employer submit proof of the
economic value of any trade secret or post a bond or other security.

(iii) None of the foregoing obligations and restrictions applies to any part of
the Confidential Information that the Executive demonstrates was or became generally
available to the public other than as a result of a disclosure by Executive.

(iv) Executive will not remove from the Employer’s premises (except to the
extent such removal is for purposes of the performance of Executive’s duties at home
or while traveling, or except as otherwise specifically authorized by the Employer)
any document, record, notebook, plan, model, component, device, or computer software
or code, whether embodied in a disk or in any other form (collectively, the
“Proprietary Items”). The Executive recognizes that, as between the Employer and the
Executive, all of the Proprietary Items, whether or not developed by Executive, are
the exclusive property of the Employer. Upon termination of this Agreement by either
party, or upon the request of the Employer during the Employment Period, Executive
will return to the Employer all of the Proprietary Items in the Executive’s
possession or subject to the Executive’s control, and the Executive shall not retain
any copies, abstracts, sketches, or other physical embodiment of any of the
Proprietary Items.

(b) Employee Inventions. Each Employee Invention will belong exclusively to the
Employer. Any idea, invention, technique, modification, process or improvement developed by
Executive that does not constitute an Employee Invention shall belong exclusively to the
Executive. The Executive acknowledges that all of the Executive’s writings, works of
authorship, and other Employee Inventions are works made for hire and the property of the
Employer, including any copyrights, patents, or other intellectual property rights
pertaining thereto. If it is determined that any such works are not works made for hire, the
Executive hereby assigns to the Employer all of the Executive’s right, title, and interest,
including all rights of copyright, patent, and other intellectual property rights, to or in
such Employee Inventions. The Executive covenants as follows:

(i) he will promptly disclose to the Employer in writing any Employee
Invention;

(ii) he hereby assigns to the Employer or to a party designated by the
Employer, all of the Executive’s rights to the Employee Invention for the United
States and all foreign jurisdictions;

(iii) that he will execute and deliver to the Employer such applications,
assignments, and other documents as the Employer may reasonably request in order to
apply for and obtain patents or other registrations with respect to any Employee
Invention in the United States and any foreign jurisdictions;

(iv) that he will sign all other papers reasonably necessary to carry out the
above obligations; and

(v) that he will give testimony and render any other assistance in support of
the Employer’s rights to any Employee Invention.

Notwithstanding the foregoing, Employer shall pay for all reasonable out-of-
pocket expenses incurred by Executive in carrying out the foregoing duties.

(c) Non-disparagement. Executive shall not disparage the Employer or any of its
shareholders, directors, officers, employees, or agents.

(d) Creative Works. Executive shall not create, assist with or consult on any
creative works which discuss, describe, or reference the Employer or any executive of the
Employer. Creative works includes but is not limited to novels, nonfiction writings, any
authored work, plays, screenplays, musicals or the like.

7.3 DISPUTES OR CONTROVERSIES

Executive recognizes that should a dispute or controversy arising from or relating to this
Agreement be submitted for adjudication to any court, arbitration panel, or other third party, the
preservation of the secrecy of Confidential Information may be jeopardized. All pleadings,
documents, testimony, and records relating to any such adjudication will be maintained in secrecy
and will be available for inspection by the Employer, the Executive, and their respective attorneys
and experts, who will agree, in advance and in writing, to receive and maintain all such
information in secrecy, except as may be limited by them in writing.

8. NON-COMPETITION AND NON-INTERFERENCE

8.1 ACKNOWLEDGMENTS OF THE EXECUTIVE

The Executive acknowledges that: (a) the services to be performed by him under this Agreement
are of a special, unique, unusual, extraordinary, and intellectual character; (b) the Employer’s
business is international in scope and its products are marketed throughout the United States and
the world; (c) the Employer competes with other businesses that are or could be located in any part
of the world; (d) the provisions of this Section 8 are reasonable and necessary to protect the
Employer’s business; and (e) in connection with the fulfillment of his duties hereunder and as an
employee of the Employer, the Employer will provide Executive with Confidential Information
necessitating the execution of the covenants contained in this Section 8.

8.2 COVENANTS OF EXECUTIVE

In consideration of the acknowledgments by Executive, and in consideration of the compensation
and benefits to be paid or provided to Executive by the Employer, Executive covenants that during
and for two (2) years following the termination of his employment for any reason, he will not,
directly or indirectly:

(a) engage or invest in, own, manage, operate, finance, control, or participate in the
ownership, management, operation, financing, or control of, be employed by, associated with,
or in any manner connected with, lend Executive’s name or any similar name to, lend
Executive’s credit to or render services or advice to, any business whose products or
activities compete in whole or in part with the products or activities of the Employer
anywhere in the world, provided, however, that Executive may purchase or otherwise acquire
up to (but not more than) five percent (5%) of any class of securities of any enterprise
(but without otherwise participating in the activities of such enterprise) if such
securities are listed on any national or regional securities exchange or have been
registered under Section 12(g) of the Securities Exchange Act of 1934, as amended;

(b) whether for Executive’s own account or for the account of any other person, solicit
business of the same or similar type being carried on by the Employer, from any person known
by Executive to be a customer or a potential customer of the Employer, whether or not the
Executive had personal contact with such person during and by reason of Executive’s
employment with the Employer; or

(c) whether for Executive’s own account or the account of any other person, (y)
solicit, employ, or otherwise engage as an employee, independent contractor, or otherwise,
any person who is an employee (or was an employee within twelve (12) months of the date in
question) of the Employer at any time during Executive’s employment or in any manner induce
or attempt to induce any employee of the Employer to terminate his employment with the
Employer; or (z) interfere with the Employer’s relationship with any person, including any
person who at any time during the Employment Period was an employee, contractor, supplier,
or customer of the Employer.

If any covenant in this Section 8.2 is held to be unreasonable, arbitrary, or against public
policy, such covenant will be considered to be divisible with respect to scope, time, and
geographic area, and such lesser scope, time or geographic area, or all of them, as a court of
competent jurisdiction may determine to be reasonable, not arbitrary, and not against public
policy, will be effective, binding, and enforceable against the Executive.

The period of time applicable to any covenant in this Section 8.2 will be extended by the
duration of any violation by the Executive of such covenant.

9. INDEMNIFICATION

Executive and Employer have executed an Indemnification Agreement dated November 4, 1996. That
Agreement will continue in effect as per its terms.

10. GENERAL PROVISIONS

10.1 INJUNCTIVE RELIEF AND ADDITIONAL REMEDY

The Executive acknowledges that the injury that would be suffered by the Employer as a result
of a breach of the provisions of this Agreement (including any provision of Sections 7 and 8) would
be irreparable and that an award of monetary damages to the Employer for such a breach would be an
inadequate remedy. Consequently, the Employer will have the right, in addition to any other rights
it may have, to obtain injunctive relief to restrain any breach or threatened breach or otherwise
to specifically enforce any provision of this Agreement, and the Employer will not be obligated to
post bond or other security in seeking such relief.

10.2 COVENANTS OF SECTIONS 7 AND 8 ARE ESSENTIAL AND INDEPENDENT COVENANTS

The covenants by Executive in Sections 7 and 8 are essential elements of this Agreement, and
without Executive’s agreement to comply with such covenants, the Employer would not have entered
into this Agreement or employed Executive. The Employer and the Executive have independently
consulted with their respective counsel and have been advised in all respects concerning the
reasonableness and propriety of such covenants, with specific regard to the nature of the business
conducted by the Employer.

If Executive’s employment hereunder expires or is terminated, this Agreement will continue in
full force and effect as is necessary or appropriate to enforce the covenants and agreements of
Executive in Sections 7 and 8.

10.3 REPRESENTATIONS AND WARRANTIES BY THE EXECUTIVE

The Executive represents and warrants to the Employer that the execution and delivery by the
Executive of this Agreement do not, and the performance by the Executive of Executive’s obligations
hereunder will not, with or without the giving of notice or the passage of time, or both: (a)
violate any judgment, writ, injunction, or order of any court, arbitrator, or governmental agency
applicable to the Executive; or (b) conflict with, result in the breach of any provisions of or the
termination of, or constitute a default under, any agreement to which the Executive is a party or
by which the Executive is or may be bound. Executive further specifically represents and warrants
that he is not subject to, nor will he violate, any agreement not to compete upon the execution and
delivery by him of this Agreement.

Executive represents and warrants that he will not utilize or divulge any proprietary
materials or information from his previous employers.

10.4 OBLIGATIONS CONTINGENT ON PERFORMANCE

The obligations of the Employer hereunder, including its obligation to pay the compensation
provided for herein, are contingent upon Executive’s performance of Executive’s obligations
hereunder.

10.5 WAIVER

The rights and remedies of the parties to this Agreement are cumulative and not alternative.
Neither the failure nor any delay by either party in exercising any right, power, or privilege
under this Agreement will operate as a waiver of such right, power, or privilege, and no single or
partial exercise of any such right, power, or privilege will preclude any other or further exercise
of such right, power, or privilege or the exercise of any other right, power, or privilege. To the
maximum extent permitted by applicable law, (a) no claim or right arising out of this Agreement can
be discharged by one party, in whole or in part, by a waiver or renunciation of the claim or right
unless in writing signed by the other party; (b) no waiver that may be given by a party will be
applicable except in the specific instance for which it is given; and (c) no notice to or demand on
one party will be deemed to be a waiver of any obligation of such party or of the right of the
party giving such notice or demand to take further action without notice or demand as provided in
this Agreement.

10.6 BINDING EFFECT; DELEGATION OF DUTIES PROHIBITED

This Agreement shall inure to the benefit of, and shall be binding upon, the parties hereto
and their respective successors, assigns, heirs, and legal representatives, including any entity
with which the Employer may merge or consolidate or to which all or substantially all of its assets
may be transferred. The duties and covenants of the Executive under this Agreement, being personal,
may not be delegated or assigned.

10.7 NOTICES

All notices, consents, waivers, and other communications under this Agreement must be in
writing and will be deemed to have been duly given when (a) delivered by hand (with written
confirmation of receipt), (b) sent by facsimile (with written confirmation of receipt), provided
that a copy is mailed by registered mail, return receipt requested and signed for by the party
required to receive notice, or (c) when received by the addressee, if sent by a nationally
recognized overnight delivery service (receipt requested), in each case to the appropriate
addresses and facsimile numbers set forth below (or to such other addresses and facsimile numbers
as a party may designate by notice to the other parties):

If to the Employer:

BMC Software, Inc.

2101 City West Blvd

Houston, Texas 77042

Telephone No. (713) 918-8800 Facsimile No. (713) 918-8000

Attn: Board of Directors

If to Executive: at most recent home address in personnel files, or other address more
recently provided to the Employer by Executive.

10.8 ENTIRE AGREEMENT; AMENDMENTS

Except as provided in (a) plans and programs of the Employer referred to in Sections 3.3 and
3.4, and (b) any signed written agreement contemporaneously or hereafter executed by the Employer
and Executive, this Agreement contains the entire agreement between the parties hereto with respect
to the subject matter hereof. All prior understandings and agreements relating to the subject
matter of this Agreement, including, without limitation, the Prior Employment Agreement, are hereby
superseded and expressly terminated. Notwithstanding the foregoing, this Agreement shall not be
construed to supersede any stock option agreements or restricted stock agreements entered into
between Executive and the Employer at any time prior to the execution of this Agreement. This
Agreement may not be amended orally, but only by an agreement in writing signed by the parties
hereto.

10.9 GOVERNING LAW

This Agreement will be governed by the laws of the State of Texas without regard to conflicts
of laws principles.

10.10 ARBITRATION

In the event that there shall be any dispute arising out of or in any way relating to
Executive’s employment with the Employer, this Agreement, the contemplated transactions, any
document referred to or incorporated herein by reference or centrally related to the subject matter
hereof, or the subject matter of any of the same, the parties covenant and agree as follows:

(a) The parties shall first use their reasonable best efforts to resolve such dispute
among themselves, with or without mediation.

(b) If the parties are unable to resolve such dispute among themselves, such disputes
shall be submitted to binding arbitration in Houston, Texas, under the auspices of, and
pursuant to the rules of, the American Arbitration Association’s Commercial Arbitration
Rules as then in effect, or such other procedures as the parties may agree to at the time,
before one arbitrator. Any award issued as a result of such arbitration shall be final and
binding between the parties, and shall be enforceable by any court having jurisdiction over
the party against whom enforcement is sought. The parties agree to abide by and perform any
award rendered by the arbitrators. If either Executive or the Employer seeks enforcement of
the terms of this Agreement or seeks enforcement of any award rendered by the arbitrators,
then the prevailing party (designated by the arbitrators) to such proceeding(s) shall be
entitled to recover its costs and expenses (including applicable travel expenses) from the
non-prevailing party, in addition to any other relief to which it may be entitled. Either
Executive or the Employer may cause an arbitration proceeding to commence by giving the
other party notice in writing of such arbitration. Executive and the Employer covenant and
agree to act as expeditiously as practicable in order to resolve all disputes by
arbitration. Notwithstanding anything in this Section to the contrary, neither Executive nor
the Employer shall be precluded from seeking court action in the event the action sought is
either injunctive action, a restraining order or other equitable relief. The arbitration
proceeding shall be held in English.

(c) Legal process in any action or proceeding referred to in the preceding section may
be served on any party anywhere in the world.

(d) Except as expressly provided herein and except for injunctions and other equitable
remedies that are required in order to enforce this Agreement, no action may be brought in
any court of law and EACH OF THE PARTIES WAIVES ANY RIGHTS THAT IT MAY HAVE TO BRING A CAUSE
OF ACTION IN ANY COURT OR IN ANY PROCEEDING INVOLVING A JURY TO THE MAXIMUM EXTENT PERMITTED
BY LAW. Each party acknowledges that it has been represented by legal counsel of its own
choosing and has been advised of the intent, scope and effect of this Section 10.10 and has
voluntarily entered into this Agreement and this Section 10.10.

(e) Excluded from this Section 10.10 are any claims for workers compensation,
unemployment insurance, or for temporary injunctive relief to enforce Sections 7 and 8 of
this Agreement.

10.11 SECTION HEADINGS; CONSTRUCTION

The headings of Sections in this Agreement are provided for convenience only and will not
affect its construction or interpretation. All references to “Section” or “Sections” refer to the
corresponding Section or Sections of this Agreement unless otherwise specified. All words used in
this Agreement will be construed to be of such gender or number as the circumstances require.
Unless otherwise expressly provided, the word “including” does not limit the words or terms it
precedes.

10.12 SEVERABILITY

If any provision of this Agreement is held invalid or unenforceable by any court of competent
jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any
provision of this Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.

10.13 COUNTERPARTS

This Agreement may be executed in one or more counterparts, each of which will be deemed to be
an original copy of this Agreement and all of which, when taken together, will be deemed to
constitute one and the same agreement.

10.14 WAIVER OF JURY TRIAL

THE PARTIES HERETO WAIVE A JURY TRIAL IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT.

10.15 WITHHOLDING OF TAXES AND OTHER EMPLOYEE DEDUCTIONS

The Employer may withhold from any payments and benefits made pursuant to this Agreement all
federal, state, city, and other taxes as may be required pursuant to any law or governmental
regulation or ruling and all other normal deductions made with respect to the Employer’s employees
generally.

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the date
first written above.

EMPLOYER:

BMC Software, Inc.

	 	 	 
	By: /s/ MICHAEL VESCUSO

	 

	Name: Michael Vescuso

	Title:

	 	Sr. Vice President of Administration

	 	 	EXECUTIVE:

/s/ ROBERT BEAUCHAMP

	 	 	Robert Beauchamp

1

EXHIBIT A TO EXECUTIVE EMPLOYMENT AGREEMENT

SEVERANCE AGREEMENT AND GENERAL RELEASE

This Severance Agreement and General Release (“Agreement”) is entered into by and between
Robert Beauchamp (“Executive”) and BMC Software, Inc. (hereinafter the “Employer”) (Executive and
the Employer are each a “party” to this Agreement and, when collectively referenced herein,
Executive and the Employer shall be referred to as the “Parties”), and is made and entered into
with reference to the following facts:

RECITALS

WHEREAS, Executive was hired by the Employer in 1988 and has held the position of the
Employer’s Chief Executive Officer since January 5, 2001, and

WHEREAS, Executive’s employment with the Employer has been terminated effective      
(the “Termination Date”); and

WHEREAS, the Employer and Executive desire to resolve, fully and finally, any and all claims
or disputes that exist or may exist between them through the date of this Agreement.

AGREEMENT

NOW THEREFORE, in consideration of the covenants and promises contained herein, the Parties
hereto agree as follows:

1. Agreement by the Employer. Prior to the execution of this Agreement, Employer will
pay Executive all Base Salary and for the value of all unused vacation earned through the date of
termination. Employer will also pay Executive for any Target Bonus awarded by the Board of
Directors but not yet paid. In exchange for Executive’s agreement to the releases and other terms
and conditions of this Agreement, the Employer agrees to provide Executive, after the Effective
Date (as defined below) of this Agreement, a total gross lump sum payment of $     , which is
equal to (a) 2 years of his Base Salary based upon his current Base Salary of $     ; (b) plus
$     , which is equal to either (i) the average of the yearly cash bonus amounts received by
Executive in each of the 3 years preceding the Termination Date; or alternatively and as applicable
(ii) if the Termination Date is fewer than 3 years from the date on which Executive became Chief
Executive Officer, the Target Bonus. (Insert other benefits if applicable.]

2. Agreement by the Executive. By signing this Agreement and accepting the payment set
forth in Section 1 above, Executive agrees to be bound by the terms of this entire Agreement.
Executive further agrees to be bound by the surviving terms of the agreements he entered into as an
employee of the Employer.

3. Release of Claims. In exchange for the consideration provided in Section 1 above,
Executive hereby expressly waives, releases, acquits and forever discharges the Employer and its
parents, successors, assigns, divisions, subsidiaries, affiliates, partners, officers, directors,
executives, investors, shareholders, managers, supervisors, employees, agents, attorneys and
representatives (hereinafter the “Released Parties” or “Releasees”), from any and all claims,
demands, and causes of action which Executive has or claims to have, whether known or unknown, of
whatever nature, which exist or may exist as of the date of Executive’s execution of this
Agreement. As used in this paragraph, “claims,” “demands,” and “causes of action” include, but are
not limited to, contract claims, equitable claims, fraud claims, tort claims, discrimination
claims, harassment claims, retaliation claims, personal injury claims, constructive discharge
claims, emotional distress claims, public policy claims, wage claims, claims for debts, accounts,
attorneys’ fees, compensatory damages, punitive damages, and/or liquidated damages, claims for the
Employer’s stock or options to purchase the Employer’s stock, claims for vesting or accelerated
vesting of options to purchase the Employer’s Common Stock, claims for defamation, and any and all
claims arising under the Americans with Disabilities Act, the Family and Medical Leave Act, or any
other federal or state statute governing employment, including but not limited to Title VII of the
Civil Rights Act of 1964, the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq., the
Texas Commission on Human Rights Act, the Texas Labor Code, as such statutes may have been or may
be amended from time to time and any other federal, state or local statute governing any aspect of
the employer/employee relationship.

4. Release of Claims for Age Discrimination. Without in any way limiting the
generality or scope of Section 3 of this Agreement, Executive hereby understands and agrees to
release any and all claims, rights or benefits Executive has or may have for age discrimination
arising out of or under the Age Discrimination in Employment Act of 1967 (“ADEA”), 29 U.S.C. § 621,
et seg., as the ADEA may have been or may be amended, or any equivalent or comparable provision of
state or local law, including, without limitation, the Texas Commission on Human Rights Act.

5. Release of Unknown Claims. Executive understands and agrees, in compliance with any
statute or ordinance which requires a specific release of unknown claims or benefits, that this
Agreement includes a release of unknown claims, and Executive hereby expressly waives and
relinquishes any and all claims, rights or benefits that Executive may have which are unknown to
Executive at the time of the execution of this Agreement.

6. Indemnification Agreement. Executive’s and Employer’s rights and responsibilities
under the Indemnification Agreement dated November 4, 1996 between Executive and Employer will
continue in effect and will not be affected by this Agreement.

7. Sufficiency of Consideration. Executive acknowledges and agrees that absent this
Agreement, Executive has no legal entitlement to the consideration provided in this Agreement and
that the consideration represents good and sufficient value for the releases and other agreements
of Executive set forth in this Agreement.

8. Non-Admission of Liability. Executive understands that the Employer denies that it
has engaged in any wrongdoing whatsoever in connection with its dealings with Executive and that
nothing in this Agreement shall constitute or be treated as an admission of any wrongdoing or
liability on the part of the Employer and/or the Released Parties.

9. Consultation with an Attorney. Executive is advised to consult with an attorney of
his choosing prior to entering into this Agreement.

10. Acceptance of Agreement. Executive has up to twenty-one (21) days after the
Termination Date to consider this Agreement and Executive may revoke this Agreement at any time
during the first seven (7) days following Executive’s execution of this Agreement by delivering
written notice of revocation to the Secretary of the Employer’s Board of Directors, no later than
five (5:00) p.m. on the seventh (7th) day after execution. Executive received this Agreement on
     , 200_. The settlement offer contained in this Agreement will automatically expire if this
Agreement, fully executed by Executive, is not received by the Secretary of the Employer’s Board of
Directors, on or before      , 200_.

11. Effective Date of Agreement. This Agreement will become effective, irrevocable and
fully enforceable upon the expiration of seven (7) days following the date of Executive’s execution
of this Agreement (the “Effective Date”), provided that Executive has executed and submitted to the
Company the executed original of this Agreement in a timely manner as set forth in Section 10 and
Executive has not exercised Executive’s right to revoke this Agreement as set forth in Section 10.

12. No Filing of Claims. Executive represents and warrants that Executive does not
presently have on file, and further represents and warrants that Executive will not hereafter file,
any claims, charges, grievances or complaints against the Employer and/or the Released Parties in
or with any administrative, state, federal or governmental entity, agency, board or court, or
before any other tribunal or panel or arbitrators, public or private, based upon any actions or
omissions by the Employer and/or the Released Parties occurring prior to the date of Executive’s
execution of this Agreement.

13. Ownership of Claims. Executive represents and warrants that Executive is the sole
and lawful owner of all rights, title and interest in and to all released matters, claims and
demands arising out of or in any way related to Executive’s employment with the Employer and/or the
resignation thereof.

14. Successors and Assigns. Executive understands and agrees that this Agreement and
all of its terms shall be binding upon Executive’s representatives, heirs, executors,
administrators, successors and assigns.

15. Tax Liability. Executive acknowledges and agrees that he has obtained no advice
from Releasees (defined above) and that neither Releasees, nor their attorneys, have made any
representation regarding the tax consequences, if any, of Executive’s receipt of the settlement
amounts and other consideration provided for in this Agreement. Executive further acknowledges and
agrees that he is personally responsible for the payment of all federal, state and local taxes that
are due, or may be due, for any payments and other consideration received by Executive under this
Agreement. Executive agrees to indemnify the Employer and hold the Employer harmless for any and
all taxes, penalties and/or other assessments that the Employer is, or may become, obligated to pay
on account of any payments and other consideration made to Executive under this Agreement.

16. Attorneys’ Fees. Executive understands and agrees that in any dispute between
Executive and the Employer regarding the terms of this Agreement and/or any alleged breach thereof,
that the prevailing party will be entitled to recover its costs and reasonable attorneys’ fees
arising out of such dispute.

17. Confidentiality. Executive understands and agrees that the terms and existence of
this Agreement and any other terms or information relating to the resignation of Executive’s
employment with the Employer are strictly confidential and may not be disclosed to any other person
or entity, with the exception of Executive’s immediate family members and legal and financial
advisors.

18. Continuing Obligations. Executive and Employer understand and agree that certain
obligations set forth in the Executive Employment Agreement between the Parties of January 5, 2001,
as it may have been amended from time to time, a copy of which is attached hereto (at the time of
execution) as Exhibit A and incorporated herein by this reference, continue beyond termination of
his employment with the Employer. Those obligations include those set forth in Sections 9, 10, 11
and 12 of that Agreement. Executive further understands and agrees that a breach of any continuing
obligation contained in the Employer’s Executive Employment Agreement shall also constitute a
breach of this Agreement.

19. Non-Disparagement. Executive agrees that he will not disparage or in any way
criticize the Employer and/or its officers, managers, supervisors, employees, investors, products,
services, or technology at any time in the future. Nothing contained in this Section is intended to
prevent Executive from testifying truthfully in any legal proceeding.

20. Headings. The headings in each section herein are for convenience of reference
only and shall be of no legal effect in the interpretation of the terms hereof.

21. Integration. This Agreement, and the surviving provisions of the accompanying
Exhibit A, constitute an integrated; written contract, expressing the entire agreement between the
Parties with respect to the subject matter hereof. In this regard, Executive represents and
warrants that he is not relying on any promises or representations which do not appear written
herein. Executive further understands and agrees that this Agreement can be amended or modified
only by a written agreement, signed by all of the Parties hereto.

22. Texas Law Applies. This Agreement shall, in all respects, be interpreted, enforced
and governed under the laws of the State of Texas applicable to contracts executed and performed in
Texas without giving effect to conflicts of law principles.

23. Severability. Executive agrees that if any provision, or portion thereof, of this

Agreement is held to be invalid or unenforceable or to be contrary to public policy or any
law, for any reason, the remainder of the Agreement shall not be affected thereby.

24. Execution by Counterparts/Facsimile. This Agreement may be executed in separate
counterparts and by facsimile, and each such counterpart shall be deemed an original with the same
effect as if all parties signed the same document.

[SIGNATURE PAGE TO SEVERANCE AGREEMENT AND GENERAL RELEASE]

EXECUTIVE UNDERSTANDS AND AGREES THAT EXECUTIVE MAY BE WAIVING SIGNIFICANT LEGAL RIGHTS BY SIGNING
THIS AGREEMENT, AND REPRESENTS THAT EXECUTIVE HAS ENTERED INTO THIS AGREEMENT VOLUNTARILY, AFTER
HAVING THE OPPORTUNITY TO CONSULT WITH AN ATTORNEY OF EXECUTIVE’S OWN CHOOSING, WITH A FULL
UNDERSTANDING OF AND IN AGREEMENT WITH ALL OF ITS TERMS.

IN WITNESS WHEREOF, the Parties have executed this Agreement on the date provided below.

ROBERT BEAUCHAMP

Date:

BMC SOFTWARE, INC.

By:

Its:

Date:

2

Exhibit B

BMC SOFTWARE, INC.

Executive Employment Agreement

Cash Bonus Description

The Executive will, during the Employment Period, be permitted to participate in the BMC
Short-term Incentive Performance Award Program that may be in effect from time to time. During the
employment period, the Executive will be eligible to receive a target incentive, which currently is
150% of base salary. The actual amount received is not guaranteed and is dependent on the
performance of the Company and the Executive in accordance with the BMC Short-term Incentive
Performance Award Program established for each fiscal year during the employment period.

Each fiscal year, the Executive will receive a detailed description of the BMC Short-term
Incentive Performance Award Program and the targeted measures and objectives for that year.

3

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