Document:

Exhibit 10.2

 

Schedule of
Executive Officer Compensation

 

Set forth below is a
description of the compensation that the Board of Directors of Vital Images, Inc.
determined to pay to its named executive officers (defined in Item 402(a)(3) of
Regulation S-K) in their current positions for the year ending December 31,
2006.

 

 

	
  Name

  	
   

  	
  2006 Base

  Salary(1)

  	
   

  	
  Securities Underlying 2006

  Stock Option Awards(#)(2)

  	
   

  	
  Securities Underlying 2006

  Restricted Stock Awards(#)(3)

  	
   

  
	
  Jay
  D. Miller, President and Chief Executive Officer

  	
   

  	
  $

  	
  320,000

  	
   

  	
  25,000

  	
   

  	
  4,000

  	
   

  
	
  Michael
  H. Carrel, Chief Operating Officer and Chief Financial Officer

  	
   

  	
  $

  	
  240,000

  	
   

  	
  10,000

  	
   

  	
  —

  	
   

  
	
  Susan
  A. Wood, Executive Vice President, Marketing and Clinical Development

  	
   

  	
  $

  	
  195,000

  	
   

  	
  5,000

  	
   

  	
  —

  	
   

  
	
  Philip
  I. Smith, Executive Vice President, Corporate Development

  	
   

  	
  $

  	
  195,000

  	
   

  	
  10,000

  	
   

  	
  —

  	
   

  
	
  Steven
  P. Canakes, Executive Vice President, Global Sales

  	
   

  	
  $

  	
  190,000

  	
   

  	
  10,000

  	
   

  	
  1,000

  	
   

  
	
  Stephen
  S. Andersen, Vice President, Vital Images Europe

  	
   

  	
  $

  	
  170,000

  	
   

  	
  5,000

  	
   

  	
  500

  	
   

  
	
  Jeremy
  A. Abbs, Vice President, Quality and Customer Satisfaction

  	
   

  	
  $

  	
  155,000

  	
   

  	
  7,500

  	
   

  	
  500

  	
   

  

 

(1)  In addition,
each Executive Officer has a bonus target equal to up to 50% of his base salary
(60% in the case of the President and Chief Executive Officer). Of the total
amount of the potential bonus, 75% is based on the Company achieving certain
financial targets, and 25% is based on the achievement of individual goals and
objectives. All Executive Officer bonuses are subject to the discretion of the
Board.

 

(2)  Under the Vital
Images, Inc. 1997 Stock Option and Incentive Plan, each Executive Officer
has been granted stock option awards for the number of shares noted. Stock option awards vest at 28% in the first
year from the grant date, and 2% per month thereafter. The stock options have a
term expiring on March 9, 2014, and the $32.14 per share exercise price of
the options is equal to the fair market value of the Company’s common stock on
the date each option was granted.

 

(3)  Under the Vital
Images, Inc. 1997 Stock Option and Incentive Plan, each Executive Officer has been granted restricted stock awards for the
number of shares noted. Restricted stock awards vest as to 25% of the number of
shares subject to the restricted stock award per year, beginning one year from
the date of grant and continuing until four years from the date of grant.Exhibit 10.32

 

EMPLOYMENT
AGREEMENT

 

THIS AGREEMENT, made and entered into as of the 24th day of October,
2005, by and between Vital Images, Inc. (“Company”) and Jeremy Abbs (“Executive”).

 

W I T N E
S S E T H:

 

WHEREAS, Company desires to retain the services of Executive for and on
behalf of Company on the terms and subject to the conditions set forth herein.

 

WHEREAS, each of the parties acknowledge that they are receiving good
and valuable consideration for entering into this Employee Agreement and Executive
acknowledges that this Employment Agreement, including the non-disclosure
agreement set forth herein, was negotiated between the parties hereto and that
Executive received bargained for consideration in the form of benefits
resulting to Executive from the terms and conditions of such employment, in
exchange for entering into this Employment Agreement.

 

NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:

 

ARTICLE I.

 

EMPLOYMENT
AND TERM

 

1.1                                 EMPLOYMENT.  Upon the terms subject to the conditions
herein contained, Company hereby employs Executive as Vice President, Quality
and Customer Satisfaction, and Executive hereby accepts such employment, subject
to the supervision of the Chief Financial Officer and Chief Operating Officer. Executive
shall devote his best skill and efforts (reasonable sick leave and vacations
excepted) to the performance of his duties under this Agreement.

 

1.2                                 TERM.  This Agreement shall take effect upon the
date first above written, and shall remain in effect as “at-will” employment
until terminated in accordance with Article IV.  Upon termination of this Agreement, except as
otherwise provided herein, neither the Company nor Executive shall have any
further rights, duties, privileges, or obligations hereunder.

 

1.3                                 COMPLIANCE WITH COMMITMENTS AND OBLIGATIONS.    Executive represents and warrants as follows: (i) he is not a party to any other agreement or obligation for personal services; (ii) there exist no impediments or restraints, contractual or otherwise on Executive’s power, right or ability to enter into this Agreement and to perform his duties and obligations hereunder; and (iii) the performance of his obligations under this Agreement do not and will not violate or conflict with any agreement relating 

 

 

to confidentiality, non-competition or exclusive employment to which Executive is or was subject.
 
1.4                                 INSIDER TRADING POLICY.  Executive will be required, as a condition of employment with the Company, to sign and comply in every respect with the Company’s Insider Trading Policy, a signed copy of which is in your personnel file.
 

ARTICLE II.

 

COMPENSATION

 

2.1                                 BASE SALARY.  In exchange for the provision of services,
Company agrees that it will pay Executive commencing October 24th, 2005,
at the rate of $144,000 per year, payable in accordance with standard pay
practices of Company, less any applicable withholdings or deductions.

 

2.2                                 BENEFITS.  In addition to the compensation set forth
under Section 2.1, Executive shall be entitled to participate in any of
Company’s standard benefit policies or plans, including its Employee Stock
Purchase plan, according to their terms. 
Subject to the provisions of Section 4.1(d) of this Agreement,
these policies may be modified or terminated from time to time by Company, but
not retroactively.  The written terms of
the policies shall govern any questions of eligibility, coverage, or duration
of coverage.

 

2.3                                 INCENTIVE COMPENSATION.  As an incentive to performance, Executive
shall be eligible to receive initiative compensation and/or benefits as
follows:

 

a.                                       Executive
shall be eligible to participate in Company’s Management Incentive Plan (the “Plan”)
as it is established annually by the Board of Directors.  Pursuant to the Plan, Executive’s incentive
target for calendar year 2005 shall be fifty percent (50%) of Executive’s base
salary for calendar year 2005.  Executive’s
incentive compensation for calendar year 2005 under the Plan, if any, will be
determined as soon as practical after December 31, 2005, and will be paid
to Executive in a lump sum, less any withholdings or deductions, on or before March 15,
2006.

 

2.4                                 VACATION.  Executive shall initially receive twenty (20)
days of vacation per year.

 

2.5                                 BUSINESS EXPENSES.  The Company will reimburse Executive for all
reasonable, ordinary, and necessary expenses incurred by him in the performance
of his duties hereunder, provided that Executive accounts to Company for such
expenses in a manner normally prescribed by Company for reimbursement of
expenses.  Such reimbursement requests
must be accompanied by the appropriate documentation and shall be subject to
review by Company’s Chief Financial Officer and Chief Operating Officer.

 

2

 

ARTICLE III.

 

DUTIES OF
EXECUTIVE

 

3.1                                 SERVICES.  Executive shall perform all duties and
obligations charged to Executive by the Company’s Chief Financial Officer and
Chief Operating Officer of Company, as the same may be determined from time to
time.  The Chief Financial Officer and
Chief Operating Officer shall assure adequate time, resources, and authority
for Executive to reach goals mutually agreed upon with Executive.

 

3.2                                 TIME AND EFFORT.  Executive shall devote his full time and
effort to the business of Company. 
Executive shall perform the duties and obligations required of Executive
hereunder in a competent, efficient, and satisfactory manner at such hours and
work conditions as the performance of these duties may require.

 

3.3                                 ARTICLES AND BY-LAWS.  Executive shall act in accordance with so as
to abide by the Articles of Incorporation of Company, the Bylaws of Company and
all decisions of the Board of Directors of Company.

 

3.4                                 CONFIDENTIALITY AND LOYALTY.  Executive acknowledges that during the course
of his employment he has produced and may produce and have access to material,
records, data, and information not generally available to the public (“Confidential
Information”) regarding Company, its customers and affiliates.  Accordingly, during and subsequent to the
termination of this Agreement, Executive shall hold in confidence and not
directly or indirectly disclose, use, copy, or make lists of any such confidential
information, except to the extent authorized in writing by Company, or as
required by law or any competent administrative agency or as otherwise is
reasonable necessary or appropriate in connection with the performance by
Executive of his duties pursuant to this Agreement.  Upon termination of his employment under this
Agreement, Executive shall promptly deliver to Company (i) all records,
manuals, books, documents, letters, reports, data, calculations, and all copies
of any of the foregoing which are the property of Company and (ii) all
other property of Company and Confidential Information which in any of these
cases are in his possession or under his control.  Executive agrees to abide by Company’s
reasonable policies as in effect from time to time, respecting avoidance of
interests conflicting with those of Company.

 

3.5                                 WORKS MADE FOR HIRE.  Executive acknowledges and agrees that any
and all works of authorship by Executive made pursuant to this Agreement or any
prior agreements are within the scope of services to be provided to Company and
shall constitute “works made for hire” as defined by the Copyright Act of 1976,
Title 17 of the United States Code, as now enacted or hereinafter amended.  To the
extent Employee retains any rights of any nature in any Work Product, Employee
hereby assigns to Company all of Employee’s right, title, and interest
(including but not limited to all patent, copyright, trade secret, and moral
rights) in and to all Work Products prepared by Employee, whether patentable or
not, made or conceived in whole or in part by Employee within the scope of
Employee’s employment by Company, or that involve the use of Confidential
Information.  Accordingly,
Executive acknowledges and agrees that Company shall be the sole and exclusive
owner of any and all copyright(s) with respect to such works of authorship and
that Executive shall not be entitled to any additional compensation over and
above the compensation set forth herein or otherwise already received by
Executive unless otherwise agreed in writing by Company.  If any work of 

 

3

 

authorship created hereunder or prior to
hereto is not deemed to be a “work made for hire,” Executive hereby assigns all
right, title, and interest therein to Company. 
Executive is hereby notified that
this assignment of Work Product does not include any invention where (i) Executive
did not use the equipment, supplies, facility or trade secret information of
Company; (ii) Executive developed the invention on his own time; (iii) the
invention does not directly relate to the business of Company or Company’s
actual or anticipated research or development; and (iv) the invention did
not result from any work performed for Company.

 

3.6                                 COMPANY TO HOLD PROPRIETARY RIGHTS.  Furthermore, and without limiting the
foregoing, Executive acknowledges and agrees that all proprietary rights,
including, without limitation, all patent, trademark, trade secret, copyright,
and other rights, which may exist in connection with any and all inventions,
ideas, and works created or conceived by Executive for Company, either before
or after the date hereof, shall be the sole and exclusive property of Company
and Executive shall have no further rights therein and, to the extent
necessary, assigns all such rights to Company. 
All patent, copyright, and other rights in such inventions, ideas, and
works shall be the property of Company, who shall have the sole right to seek
patent, copy, registered design or other protection in connection
therewith.  Executive shall at Company’s
reasonable expense do all things and execute all such documents as Company may
reasonably require to vest in Company the rights and protection herein
described.

 

3.7                                 RESTRICTION ON COMPETITION.  Executive agrees that for a period of eighteen (18) months from the date of Executive’s termination of employment with the Company, irrespective of the reasons for termination, Executive shall not, directly or indirectly, and regardless of whether Executive is acting as owner, partner, stockholder, employee, broker, agent, principal, trustee, corporate officer, director, consultant or in any other capacity, (1) develop, market, or distribute any products competitive with the Company’s products, or (2) provide services for any person or entity that is developing, marketing or distributing products competitive with the Company’s products, or (3)  solicit or attempt to solicit the employment of any employee of the Company or any of the Company’s affiliates, whether on his own behalf or on behalf of any other person or entity, provided, however, that this Agreement will not prevent Executive from holding for passive investment purposes up to 1% of any class of stock or other securities of a publicly held company with products that are competitive with the Company’s products.  The term “employment” for purposes of this Article 3.7 means to enter into an arrangement for services as a full-time or part-time employee, independent contractor, agent or otherwise. You and the Company agree that this provision is reasonably enforced as to any geographic area in which the Company conducts its business.
 

3.8                                 REMEDIES.  Executive agrees and understands that any
breach of any of the covenants or agreements set forth in this ARTICLE III
of this Agreement will cause Company irreparable harm for which there is no
adequate remedy at law, and, without limiting whatever other rights and
remedies Company may have under this paragraph, Executive consents to the
issuance of an injunction in favor of Company enjoining the breach of any of
the aforesaid covenants or agreements by any court of competent
jurisdiction.  If any or all of the
aforesaid covenants or agreements are held to be unenforceable because of 

 

4

 

the scope or duration of such covenant or
agreement or the area covered thereby, the parties agree that the court making
such determination shall have the power to reduce or modify the scope,
duration, and/or area of such covenant to the extent that allows the maximum
scope, duration, and/or area permitted by applicable law.

 

ARTICLE IV.

 

TERMINATION

 

4.1                                 RESIGNATION OF EXECUTIVE.  Executive may resign his employment at any
time for any reason upon fifteen (15) days advance written notice to the Chief
Financial Officer and Chief Operating Officer. 
If Executive resigns his employment without Good Reason (as that term is
defined below), he shall not be entitled to severance pay.  If Executive resigns his employment for Good
Reason, the Company shall pay Executive the severance pay set forth in Section 4.2
below provided Executive agrees to release any claims he may have against the
Company in exchange for receipt of severance pay.  For purposes of the Agreement, Good Reason
shall mean the occurrence of any of the following events, which the Company has
not cured within thirty (30) days of notice thereof:

 

a.                                       A
material breach of this Agreement by the Company;

 

b.                                      A
material adverse change in Executive’s status or position as an executive
officer of the Company as a result of a material diminution in Executive’s
duties, responsibilities, or authority as of the date of this Agreement (except
in connection with the termination of Executive’s employment in accordance with
Section 4.3 hereof);

 

c.                                       A
reduction by the Company of the Executive’s base salary as the same may be
increased from time to time;

 

d.                                      Without
replacement by a plan providing benefits to Executive equal to or greater than
those discontinued or by payment of cash in lieu of such benefits, the failure
by the Company to continue in effect, within its maximum stated term, any
employee benefit plan in which Executive is participating in prior to the date
of this Agreement or taking of any action by the Company that would adversely
affect Executive’s participation or materially reduce Executive’s benefits
under all such plans; provided, however, that Good Reason shall not include
changes, modifications, and terminations of the Company’s standard benefit
policies and plans which are generally applicable to the Company’s officers and
employees; or

 

e.                                       The
Company’s requiring Executive to be based anywhere other than that
Minneapolis/St. Paul, Minnesota metropolitan statistical area, except for
required travel on the Company’s business.

 

4.2                                 TERMINATION BY COMPANY.  Company shall have the right to terminate
Executive’s employment without notice and with or without Cause, as that term
is defined below.  If Company terminates
Executive’s employment without cause, 

 

5

 

Company shall pay Executive six (6) months
of severance pay based on Executive’s base salary at the time of termination
provided Executive agrees to release any claims he may have against the company
in exchange for the receipt of severance pay. 
Executive’s severance pay, if any, shall be payable in one lump sum,
less any applicable withholdings or deductions, within ten (10) days after
the expirations of any applicable rescission periods.  If Company terminates Executive’s employment
with Cause, Executive shall not receive severance pay.

 

4.3                                 TERMINATION FOR CAUSE.  Notwithstanding anything contained in this
Agreement to the contrary, Company shall have the right to terminate the
employment of Executive for Cause.  Cause
means:

 

a.                                       Executive’s
gross misconduct;

 

b.                                      Executive
shall inexcusably violate or willfully refuse to obey the lawful and reasonable
instructions of the Chief Financial Officer and Chief Operating Officer or the
Board of Directors of the Company; or

 

c.                                       Executive’s
conviction (including a plea of nolo contendere) of willfully engaging in
illegal conduct constituting a felony or gross misdemeanor under federal or
state law which is materially and demonstrably injurious to the Company or
which impairs Executive’s ability to perform substantially his duties for the
Company.

 

An act, or failure to act, will be considered
“gross” or “willful” for this purpose only if done, or omitted to be done, by
Executive in bad faith and without reasonable belief that it was in, or not
opposed to, the best interests in the Company. 
Any act, or failure to act, based upon authority given pursuant to a
resolution duly adopted by the Company’s Board of Directors (or a committee
thereof) or based upon the advice of counsel for the Company will be
conclusively presumed to be done, or omitted to be done, by Executive in good
faith and in the best interests of the Company. 
It is also expressly understood that Executive’s attention to matters
not directly related to business of the Company will not provide a basis for
termination for Cause so long as the Board did not expressly disapprove in
writing of Executive’s engagement in such activities either before or within a
reasonable period of time after the Board knew or could have reasonably known
the Executive engaged in those activities. 
Notwithstanding the foregoing, Executive may not be terminated for Cause
unless and until there has been delivered to him a copy of a resolution duly
adopted by the affirmative vote of not less than a majority of the entire
membership of the Board at a meeting of the Board called and held for the
purpose (after reasonable notice to Executive and an opportunity for him,
together with his counsel, to be heard before the Board), finding that in the
good faith opinion of the Board Executive was guilty of the conduct set forth above
in clauses a., b., or c. of this definition and specifying the particulars
thereof in detail.

 

Where the employment of the Executive is
terminated pursuant to this Article IV, Section 4.3 of this
Agreement, such termination shall be effective upon the delivery of notice
thereof to Executive.

 

6

 

4.4.                              SURVIVING RIGHTS.  Notwithstanding the termination of Executive’s
employment, the parties shall be required to carry out any provisions hereof
which contemplate performance subsequent to such termination; and such
termination shall not affect any liability or other obligation which shall have
accrued prior to such termination, including, but not limited to, any liability
for loss or damage on account of a prior default.

 

4.5.                              COOPERATION AND NON-DISPARAGEMENT.    Executive agrees that, during the term of
this Agreement and for three (3) years following the termination of his
employment, Executive will (i) assist and cooperate with the Company
regarding any claims or disputes involving matters within the knowledge or
responsibilities of Executive; and (ii) not in any way or by any means
disparage the Company, the members of the Company’s Board of Directors or the
Company’s officers and employees.

 

4.6.                              DISCLOSURE.    Executive agrees that, during the term of
this Agreement and for three (3) years following the termination of his
employment, Executive will inform any new employer or other person or entity
with whom he enters into a business relationship, before accepting employment
or entering into a business relationship, of the post-employment restrictions
and obligations contained in this Agreement, including but not limited to the
existence of Articles 3.7, and 4.5 above.

 

ARTICLE V.

 

GENERAL
PROVISIONS

 

5.1                                 NOTICES.  All notices, requests, and other
communications shall be in writing and except as otherwise provided herein,
shall be considered to have been delivered if personally delivered or when
deposited in the United States mail, first class, or certified or registered,
postage prepaid, return receipt requested, addressed to the proper party at its
address set forth below, or to such other address as such party may hereafter
designate by written notice to the other party:

 

	
  a.

  	
   

  	
  If to
  Company, to:

  	
   

  	
  Vital Images, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
  5850 Opus
  Parkway, Suite 300

  
	
   

  	
   

  	
   

  	
   

  	
  Minnetonka,
  MN 55343

  
	
   

  	
   

  	
   

  	
   

  	
  Attention:
  Chief Financial Officer and

  
	
   

  	
   

  	
   

  	
   

  	
  Chief
  Operating Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  b.

  	
   

  	
  If to
  Executive, to:

  	
   

  	
  Jeremy Abbs

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

7

 

5.2                                 WAIVER, MODIFICATION, or AMENDMENT.  No waiver, modification, or amendment of any
term, condition, or provision of this Agreement shall be valid or of any effect
unless made in writing, signed by the party to be bound or its duly authorized
representative and specifying with particularity the nature and extent of such
waiver, modification, or amendment.  Any
waiver by any party of any default of the other shall not effect, or impair any
right arising from, any subsequent default. 
Nothing herein shall limit the rights and remedies of the parties hereto
under and pursuant to this Agreement, except as hereinbefore set forth.

 

5.3                                 ENTIRE AGREEMENT.  This Agreement contains the entire
understanding of the parties hereto in respect of transactions contemplated hereby
and supersedes all prior agreements and understandings between the parties with
respect to such subject matter.

 

5.4                                 INTERPRETATION AND SEVERANCE.  The provisions of this Agreement shall be
applied and interpreted in a manner consistent with each other so as to carry
out the purposes and intent of the parties hereto, but if for any reason any
provision hereof is determined to be unenforceable or invalid, such provision
or such part thereof as may be unenforceable or invalid shall be deemed severed
from this Agreement and the remaining provisions shall be carried out with the
same force and effect as if the severed provision or part thereof had not been
a part of this Agreement.

 

5.5                                 GOVERNING LAW.  This Agreement shall be construed and
enforced in accordance with the laws of the State of Minnesota.

 

5.6                                 ASSIGNMENT.  Executive acknowledges that Executive’s
services are unique and personal. 
Accordingly, Executive may not assign Executive’s rights or delegate
Executive’s duties or obligations under this Agreement.  Company’s rights and obligations under this
Agreement shall inure to the benefit of and shall be binding on Company’s
successors and assigns.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

 

 

	
   

  	
  VITAL IMAGES, INC.:

  
	
   

  	
  By 

  	
  /s/ Michael H. Carrel

  	
   

  
	
   

  	
   

  	
  Michael Carrel

  
	
   

  	
   

  	
  Chief Financial Officer and

  
	
   

  	
   

  	
  Chief Operating Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  EXECUTIVE:

  
	
   

  	
   

  	
   

  
	
   

  	
  By 

  	
  /s/ Jeremy Abbs

  	
   

  
	
   

  	
   

  	
  Jeremy Abbs

  
					

 

8

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