Document:

Exhibit
10.27

 

EXHIBIT B

 

EXECUTIVE
SEVERANCE AGREEMENT

 

THIS AGREEMENT is entered
into this            day
of                  ,
2005 by and between Euramax International, Inc., a Delaware corporation,
and                         (“Executive”).

 

WITNESSETH

 

WHEREAS, the Company
considers the establishment and maintenance of a sound and vital management to
be essential to protecting and enhancing the best interests of the Company and
its stockholders; and

 

WHEREAS, Executive
currently serves as an officer of the Company or a Subsidiary thereof and the
Company recognizes that the possibility of a Change of Control may arise and
that such possibility, and the uncertainty and questions which it may raise
among management, may result in the departure or distraction of management
personnel to the detriment of the Company and its stockholders; and

 

WHEREAS, the Board (as
defined in Section 1) has determined that it is in the best interests of
the Company and its stockholders to secure Executive’s continued services and
to ensure Executive’s continued and undivided dedication to his duties; and

 

WHEREAS, the Board has
authorized the Company to enter into this Agreement.

 

NOW, THEREFORE, for and
in consideration of the premises and the mutual covenants and agreements herein
contained, the Company and Executive hereby agree as follows:

 

1.             Definitions:  As used in this Agreement, the following
terms shall have the respective meanings set forth below:

 

(a)           “Affiliate”
means, with respect to any Person, any other Person who directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under
common control with, such Person including, without limitation, any employee of
such Person.  The term “control” means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities or other ownership interests, by contract or
otherwise, and the terms “controlled” and “controlling” have meanings
correlative thereto.

 

(b)           “Board”
means the Board of Directors of the Company.

 

(c)           “Business
Day” means any day other than a Saturday or Sunday or a day on which commercial
banks are required or authorized to close in New York, New York.

 

 

(d)           “Cause”
means (i) conviction of the Executive for a felony, a crime involving
moral turpitude (excluding in each case vehicular offenses) or other act or
willful omission involving dishonesty or fraud with respect to any member of
the Company Group, in each case, which causes material harm to the standing and
reputation of any member of the Company Group and after written notice to
Executive or (ii) other than by reason of death, Permanent Disability or
termination of employment by Executive based on the occurrence of an event
constituting Good Reason, Executive’s continued failure to perform his duties
(consistent with those duties previously performed by Executive in his capacity
as an executive officer of the Company and those of an executive officer in an organization
of similar size and structure as the Company) to the Company and/or deliberate
failure or deliberate refusal by Executive to comply with a reasonable written
directive of the Board or the Chief Executive Officer of the Company which is
consistent with the method and manner of conducting the business of the Company
as it is now being conducted, after written notice and, if susceptible to
remedy or cure is not cured or remedied and continues for fifteen (15) Business
Days after the Board has given written notice to the Executive specifying in
reasonable detail the manner in which Executive has continued to fail to
perform his duties or refused to comply with such reasonable directive and
after the Executive has been afforded an opportunity to be heard by the Board
in respect thereto.  The Company must
notify Executive of any event constituting Cause within ninety (90) calendar
days following the Company’s knowledge of its existence or such event shall not
constitute Cause under this Agreement.

 

(e)           “Change
of Control” means, in a single transaction or a series of related transactions,
the consummation within the term of this Agreement set forth in Section 5
hereof, of any of the following:

 

(1) a
majority of the outstanding voting power of the Company shall have been
acquired or otherwise become beneficially owned by any Person (other than the
Existing Owner Group, Company, any other member of the Company Group, or any
Affiliate of any member of the Company Group) or any two or more Persons acting
as a partnership, limited partnership, syndicate or other group, entity or
association acting in concert for the purpose of voting, acquiring, holding or
disposing of voting stock of the Company (the “Company Voting Securities”); or

 

(2) 
there shall have occurred:

 

(A) 
a merger or consolidation of the Company with or into another corporation,
other than (i) a merger or consolidation with any other member of the
Company Group or (ii) a merger or consolidation in which the holders of
Company Voting Securities immediately prior to the merger as a class hold
immediately after the merger at least a majority of all outstanding voting
power of the surviving or resulting corporation or its parent; or

 

(B) 
a statutory exchange of shares of one or more classes or series of outstanding
Company Voting Securities for cash, securities or other property, other than an
exchange in which the holders of Company Voting Securities immediately prior to
the exchange as a class hold immediately after the exchange

 

2

 

at least a majority of
all outstanding voting power of the entity with which the Company Voting
Securities are being exchanged; or

 

(C) 
the sale or other disposition of more than 80% of the consolidated assets of
the Company and its Subsidiaries (based on the net book value of the
consolidated assets of the Company and its Subsidiaries in the most recent
audited financial statements of the Company), in one transaction or a series of
transactions, other than a sale or disposition in which the holders of Company
Voting Securities immediately prior to the sale or disposition as a class hold
immediately after the sale or disposition at least a majority of all
outstanding voting power of the entity to which such assets of the Company are
being sold.

 

Notwithstanding anything
in this Agreement to the contrary, if Executive’s employment is terminated
prior to a Change of Control, and Executive reasonably demonstrates that such
termination was at the request or suggestion of a third party who has indicated
an intention or taken steps reasonably calculated to effect a Change of Control
(a “Third Party”) and a Change of Control involving such Third Party occurs,
then for all purposes of this Agreement, a “Change of Control” shall be deemed
to have occurred and the date of a Change of Control shall mean the date
immediately prior to the date of such termination of employment.

 

(f)            “Company”
means Euramax International, Inc., a Delaware corporation.

 

(g)           “Company
Group” means, collectively, the Company, its Subsidiaries and their respective
successors and assigns.

 

(h)           “Date
of Termination” means (1) the effective date on which Executive’s
employment by the Company terminates as specified in a prior written notice by
the Company or Executive, as the case may be, to the other, delivered pursuant
to Section 9, or (2) if Executive’s employment by the Company
terminates by reason of death, the date of death of Executive.

 

(i)            “Existing
Owner Group” means Citigroup Venture Capital Equity Partners, L.P., the current
executive officers of the Company and its Subsidiaries and
any combination of the foregoing and their Affiliates.

 

(j)            “Good
Reason” means the occurrence of any of the following events after a Change of
Control, without Executive’s express written consent:

 

(1)           the
assignment to Executive of any duties or responsibilities inconsistent in any
material respect with Executive’s position(s), duties, responsibilities or
status with the Company or any other member of the Company Group immediately
prior to such Change of Control (including any material diminution of his
duties, responsibilities or authority and including without limitation, the
Executive ceasing to serves as the sole [Lewis: Executive Vice
President and Corporate Business Development Director] [Vansant: Chief Financial Officer] of the Company);

 

3

 

(2)           a
reduction in Executive’s rate of annual base salary or annual bonus opportunity
as in effect immediately prior to such Change of Control or failure to promptly
pay him any such compensation;

 

(3)           any
requirement that Executive (i) be based anywhere more than twenty-five
(25) miles from the facility where Executive is located at the time of the
Change of Control or (ii) travel on Company business to an extent that
requires extended, overnight travel which is substantially greater than the
travel obligations of Executive immediately prior to such Change of Control; or

 

(4)           the
failure of the Company or any other member of the Company Group to continue to
make available to Executive a package of benefits including employee benefit
plans, welfare benefits, fringe benefits, vacation and sick pay plans which are
substantially equivalent, in the aggregate, to those plans in which Executive
is participating immediately prior to such Change of Control.

 

Any event or condition
described in this Section 1(j)(1) through (4) which occurs prior
to a Change of Control, but was at the request or suggestion of a Third Party
who effectuates a Change of Control, shall constitute Good Reason following a
Change of Control for purposes of this Agreement notwithstanding that it
occurred prior to the Change of Control, and any termination of employment by
Executive for such Good Reason in accordance with this Agreement after the date
hereof, whether prior to or after a Change of Control, shall be deemed to have
occurred during the Termination Period. 
An action taken in good faith and which is remedied by the Company within
fifteen (15) Business Days after receipt of notice thereof given by Executive
shall not constitute Good Reason. 
Executive must provide notice of termination of employment within ninety
(90) calendar days of Executive’s knowledge of an event constituting Good
Reason or such event shall not constitute Good Reason under this Agreement.

 

(k)           “Nonqualifying
Termination” means a termination of Executive’s employment (1) by the
Company for Cause, (2) by Executive for any reason other than Good Reason,
(3) as a result of Executive’s death, or (4) by the Company due to
Executive’s Permanent Disability.

 

(l)            “Permanent
Disability” means Executive is unable to perform, in the written opinion of a
medical doctor mutually agreed to by the Company and by the Executive or his
legal representative (and if the Company and Executive are unable to agree upon
a medical doctor, a third doctor selected by the doctor selected by the Company
and the doctor selected by Executive or his legal representative), by reason of
physical or mental incapacity, his duties or obligations under this Agreement,
for a period of one hundred twenty (120) consecutive calendar days or a total
period of one hundred fifty (150) calendar days in any three hundred sixty
(360) calendar day period.

 

(m)          “Person”
means an individual, a partnership, a corporation, an association, a joint
stock company, a limited liability company, a trust, a joint venture, an
unincorporated organization, a governmental entity, or any department, agency
or political subdivision thereof, or any other entity.

 

4

 

(n)           “Subsidiary”
means, with respect to any Person, any corporation, partnership, association or
other business entity of which (i) if a corporation, a majority of the
total voting power of shares of stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers
or trustees thereof is at the time owned or controlled, directly or indirectly,
by that Person or one or more of the other Subsidiaries of that Person or a
combination thereof, or (ii) if a partnership, association or other
business entity, a majority of the partnership or other similar ownership
interest thereof is at the time owned or controlled, directly or indirectly, by
any Person or one or more Subsidiaries of that Person or a combination
thereof.  For purposes hereof, a Person
or Persons shall be deemed to have a majority ownership interest in a
partnership, association or other business entity if such Person or Persons
shall be allocated a majority of partnership, association or other business
entity gains or losses or shall be or control the managing director or general
partner of such partnership, association or other business entity.

 

(o)           “Termination
Period” means the period of time beginning with a Change of Control and ending
on the second anniversary of the effective date of such Change of Control.

 

2.             Payments
Upon Termination of Employment. If during the Termination Period
the employment of Executive shall terminate, other than by reason of a
Nonqualifying Termination, and Executive agrees upon such termination to
execute a release, in the same form as attached hereto as Exhibit A,
with respect to all tort and contract claims, as well as claims brought under
all applicable federal, state or local statutes, laws, regulations or
ordinances, then the Company shall pay to Executive (or Executive’s beneficiary
or estate) within thirty (30) calendar days after the Company’s receipt of the
signed release (and upon the expiration of any revocation rights in the
release), as compensation for services rendered to the Company, a lump-sum cash
amount equal to the sum of:

 

(a)           Executive’s
base salary through the Date of Termination and any unpaid bonus for the fiscal
year ending prior to the Date of Termination to the extent not theretofore
paid;

 

(b)           A
pro rata portion of Executive’s annual bonus in an amount at least equal
to:  (i) the greater of (A) 50%
(or such higher percentage as shall then be applicable to Executive pursuant to
the Euramax Incentive Bonus Plan (such plan being the “Bonus Plan” and such
higher percentage being the “Higher Percentage”) for the fiscal year in which
the Change of Control occurs) of Executive’s annualized base salary for the
fiscal year in which the Change of Control occurs, and (B) 50% (or such
Higher Percentage for the fiscal year in which the Date of Termination occurs)
of Executive’s annualized base salary for the fiscal year in which Executive’s
Date of Termination occurs, in either case, multiplied by (ii) a fraction,
the numerator of which is the number of calendar days in the fiscal year in
which the Date of Termination occurs through the Date of Termination and the
denominator of which is three hundred sixty-five (365);

 

(c)           Any
accrued vacation pay  to the extent not
theretofore paid;

 

5

 

(d)           Three
times Executive’s annualized rate of base salary in effect 30 days prior to the
Date of Termination (disregarding any change therein which constitutes Good
Reason hereunder); and

 

(e)           Three
times 50% of Executive’s annualized base salary for the fiscal year in which
Executive’s Date of Termination occurs (disregarding any change therein which
constitutes Good Reason hereunder).

 

Any amount paid pursuant
to Section 2 shall be in lieu of any other amount of severance relating to
salary or bonus continuation to be received by Executive upon termination of
employment of Executive under any severance plan or policy of the Company
during the Termination Period.  After the
Termination Period, if Executive’s employment is terminated by the Company
without Cause or by the Executive for Good Reason, the Executive shall be
entitled to receive severance in accordance with whatever severance plans and
policies that the Company or the surviving entity after the Change of Control
has in place for similarly situated employees on the Date of Termination,
giving full service credit under all such plans for the period prior to the
Change of Control during which Executive was employed by the Company.

 

3.             Certain
Additional Payments by the Company.

 

(a)           Excess
Parachute Payment.    If any payments to be received by the
Executive, including payments under this Agreement, either alone or in
conjunction with any other payments or benefits made available to the Executive
in connection with the termination of the Executive’s employment or a Change of
Control of the Company result in Executive’s incurring the tax (the “Excise Tax”)
imposed by Section 4999 of the Internal Revenue Code of 1986 (the “Code”)
on “excess parachute payments” within the meaning of Section 280G(b)(1) of
the Code, the Company will pay to Executive an additional amount (the “Gross Up
Payment”) necessary to reimburse Executive on an after-tax basis (including
FICA, excise taxes, interest and penalties) for the Excise Tax.  In determining the amount of the Gross Up
Payment, Executive will be deemed to pay federal income taxes at the highest
marginal rate of federal income taxation in the calendar year in which the
Gross Up Payment is to be made and state and local income taxes at the highest
marginal rates of taxation in the state and locality of Executive’s residence
on the Date of Termination, net of the maximum reduction in federal income
taxes that could be obtained from deduction of such state and local taxes.

 

(b)           The
Executive agrees that he will not report any payments received from the Company
following a Change of Control to the IRS as being subject to the Excise Tax;
provided that, if Executive receives and provides to the Company a written
opinion from Executive’s tax counsel or from an accounting firm reasonably
acceptable to the Company that it is reasonably likely that Executive will be
subject to the Excise Tax or a penalty as a result of reporting such payments
on such basis, the Company shall within 30 days after the receipt of such
opinion, either (i) promptly pay the amount of the Excise Tax and the
Gross-Up Payment as provided in Section 3(a) hereof prior to the time
such Excise Tax is due to Executive, which Excise Tax amount Executive
covenants to pay to the IRS within 10 days after Executive’s receipt thereof
from the Company or (ii) provide Executive with an opinion effective as of
the time of Executive’s filing of his return relating to such payments,
addressed to Executive from a

 

6

 

tax advisor or counsel
reasonably acceptable to Executive, which provides that there is a reasonable
basis as defined in Treasury Regulation Section 1.6662-3(b)(3) for
reporting the payments received by Executive from the Company following a
Change of Control to the IRS as not being subject to the Excise Tax.  If the IRS challenges Executive’s position
that the payments are not subject to the Excise Tax, the Company has the right,
in its sole discretion and at its sole expense and with the Executive’s
co-operation, to defend that position and negotiate, dispute or litigate with
the IRS in whatever forums the Company considers appropriate.  Any Gross-Up Payment will only be made when
such dispute is finally resolved or determined by final non-appealable
authority.

 

4.             Withholding
Taxes.  The Company may withhold from
all payments due to Executive (or his beneficiary or estate) hereunder all
taxes which, by applicable federal, state, local or other law, the Company is
required to withhold therefrom.

 

5.             Term
of Agreement.  This Agreement shall
be effective on the date hereof and shall continue in effect until the first
anniversary of the date hereof; provided, however, if on the first anniversary
of the date hereof, the Company or its shareholders are party to a definitive
agreement the consummation of which would result in a Change of Control, the
term of this Agreement shall be automatically extended through the consummation
of such Change of Control or its earlier abandonment or termination.  This Agreement shall continue in effect for a
period of twenty-four (24) months after a Change of Control, if such Change of
Control shall have occurred during the term of this Agreement provided above.  Notwithstanding anything in this Section 5
to the contrary, this Agreement shall terminate if Executive or the Company
terminates Executive’s employment prior to a Change of Control, except as
provided in the last paragraph of Section 1(e) or the last paragraph
of Section 1(j).

 

6.             Termination
of Agreement.  This Agreement shall
be effective on the date hereof and shall continue until the first to occur of (a) termination
of Executive’s employment with the Company prior to a Change of Control (except
if such termination is pursuant to the last paragraph of Section 1(e) or
the last paragraph of Section 1(j) hereof), (b) a Nonqualifying
Termination, (c) the end of the Termination Period, or (d) expiration
in accordance with Section 5.

 

7.             Scope
of Agreement.  Nothing in this
Agreement shall be deemed to entitle Executive to continued employment with the
Company or its Subsidiaries, and if Executive’s employment with the Company
shall terminate prior to a Change of Control, Executive shall have no further
rights under this Agreement (except if such termination is pursuant to the last
paragraph of Section 1(e) or the last paragraph of Section 1(j)
hereof)); provided, however, that any termination of Executive’s
employment during the Termination Period shall be subject to all of the
provisions of this Agreement.

 

8.             Successors;
Binding Agreement.

 

(a)           This
Agreement shall not be terminated by any merger, consolidation, share exchange
or similar form of corporate reorganization of the Company or any such type of
transaction involving the Company or any other member of the Company Group (a “Business

 

7

 

Combination”).  In the event of any Business Combination, the
provisions of this Agreement shall be binding upon the surviving or resulting
corporation or the Person to which such assets are transferred (the “Surviving
Company”) and such Surviving Company shall be treated as the Company hereunder.

 

(b)           This
Agreement shall inure to the benefit of and be enforceable by Executive’s
personal or legal representatives, executors, administrators, successors,
heirs, distributees, devisees and legatees. 
If Executive shall die and, under the terms of this Agreement, any
payment would be required to Executive hereunder, , all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to such Person or Persons appointed in writing by Executive to
receive such amounts or, if no Person is so appointed, to Executive’s estate.

 

9.             Notice.

 

(a)           For
purposes of this Agreement, all notices and other communications required or
permitted hereunder shall be in writing and shall be deemed to have been duly
given when delivered or five (5) Business Days after deposit in the United
States mail, certified and return receipt requested, postage prepaid, addressed
as follows:

 

	
  If to the Executive:

  	
  At the last known
  address shown in the Company’s

  personnel records

  
	
   

  	
   

  
	
  If to the Company:

  	
  Euramax
  International, Inc.

  
	
   

  	
  5445 Triangle Parkway

  
	
   

  	
  Suite 350

  
	
   

  	
  Norcross, Georgia 30092

  
	
   

  	
  ATTN: Corporate
  Secretary

  

 

or to such other address
as either party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon
receipt.

 

(b)           A
written notice of Executive’s Date of Termination by the Company or Executive,
as the case may be, to the other, shall (1) indicate the specific
termination provision in this Agreement relied upon, (2) to the extent
applicable, set forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of Executive’s employment under the
provision so indicated and (3) specify the termination date.  The failure by Executive or the Company to
set forth in such notice any fact or circumstance which contributes to a
showing of Good Reason or Cause shall not waive any right of Executive or the
Company hereunder or preclude Executive or the Company from asserting such fact
or circumstances in enforcing Executive’s or the Company’s rights hereunder.

 

10.           Full
Settlement. Payment by the Company of its obligations hereunder and
performance of the Company’s other obligations hereunder shall be in lieu and
in full settlement of all other severance obligations to Executive under any
severance or employment agreement between the Executive and any member of the
Company Group, excluding other benefits

 

8

 

specifically provided by
the Company to Executive contingent upon a Change of Control, if any, as
approved by the Board and any payments to which Executive is entitled under the
Company’s Supplemental Executive Retirement Plan.  In no event shall Executive be obligated to
seek other employment or take other action by way of mitigation of the amounts
payable to Executive under any of the provisions of this Agreement and such
amounts shall not be reduced whether or not Executive obtains other employment
and shall not be reduced by offset against any amount claimed to be owed by the
Executive to the Company.

 

11.           Governing
Law, Validity.  The interpretation,
construction and performance of this agreement shall be governed by and
construed and enforced in accordance with the internal laws of the state of
Delaware without regard to the principle of conflicts of laws.  The invalidity or unenforceability of any
provision of this agreement shall not affect the validity or enforeceability of
any other provision of this agreement, which other provisions shall remain in
full force and effect.

 

12.           Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.

 

13.           Miscellaneous.  No provision of this Agreement may be
modified or waived unless such modification or waiver is agreed to in writing
and signed by Executive and by a duly authorized officer of the Company.  No waiver by either party hereto at any time
of any breach by the other party hereto of, or compliance with, any condition
or provision of this Agreement to be performed by such other party shall be
deemed a waiver of similar or dissimilar provisions or conditions at the same
or at any prior or subsequent time. 
Failure by Executive or the Company to insist upon strict compliance
with any provision of this Agreement or to assert any right Executive or the
Company may have hereunder shall not be deemed to be a waiver of such provision
or right or any other provision or right of this Agreement.  Except as otherwise specifically provided
herein, the rights of, and benefits payable to, Executive, Executive’s estate
or Executive’s beneficiaries pursuant to this Agreement are in addition to any
rights of, or benefits payable to, Executive, Executive’s estate or Executive’s
beneficiaries under any other employee benefit plan or compensation program of
the Company.

 

14.           Confidential
Information.  Executive hereby agrees
that, if there is a Change of Control and Executive’s employment with the
Company is terminated for any reason other than a Nonqualifying Termination
either prior to the Change of Control pursuant to the last paragraph of Section 1(e) or
the last paragraph of Section 1(j) hereof or after the Change of Control
during the Termination Period, Executive agrees that he will not disclose any
Confidential Information of the Company, its Subsidiaries and/or Affiliates
that came into his knowledge during his employment by the Company without the
prior written consent of the Company.  “Confidential
Information” means any data or information that the Company treats as
confidential, that is valuable to the Company and that is not known to the
public or to vendors or to competitors of the Company, its Subsidiaries or
Affiliates.

 

15.           Required
Approval.  The obligations of the
Company hereunder are contingent upon approval of this Agreement by more than
75% of the voting power of the Company’s

 

9

 

outstanding stock (as
determined under Section 280G(b)(5)(B)(i) of the Internal Revenue
Code of 1986, as amended (the “Code”), and the Treasury Regulations promulgated
under Code Section 280G), which approval the Company shall obtain prior to
the execution of a binding contract for a merger or other transaction which
would result in a Change of Control.. The Executive and the Company acknowledge
that in seeking such approval, they will use their best efforts to satisfy the
requirements of Code Section 280G(b)(5)(A)(ii) and the Treasury
Regulations promulgated under Code Section 280G.

 

IN WITNESS WHEREOF, the
Company has caused this Agreement to be executed by a duly authorized officer
of the Company and Executive has executed this Agreement as of the day and year
first above written.

 

 

	
  EURAMAX INTERNATIONAL,
  INC.

  	
   

  	
  EXECUTIVE:

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
					

 

10

 

EXHIBIT A
-RELEASE

 

THIS RELEASE (the “Release”)
is entered into by and between [insert name of employer]
(the “Company”) and                 (“Employee”),
a resident of the state and country of                 .

 

WITNESSETH

 

Employee and the
Company are terminating their employment relationship, effective         ,
        , and desire to settle fully
and finally all differences between them that may arise out of or relate to
Employee’s employment with the Company and all other claims Employee has or may
have through the Effective Date of this Release; and

 

NOW, THEREFORE, in
consideration of this recital, the agreements, warranties, and representations
contained herein and other good and valuable consideration, the receipt, adequacy
and sufficiency of which is hereby acknowledged, the parties to this Release
hereby agree as follows:

 

1.             Execution.
Employee represents and warrants that he or she is competent to enter into this
Release, is relying on independent judgment and the opportunity to seek the
advice of legal counsel, and has not been influenced in making this Release by
any representations made by or on behalf of the Company.

 

2.             Specific
Consideration. In exchange for the release provided hereunder and other
good and valuable consideration, and upon the execution of this Release,
Employee shall be paid in accordance with that certain Executive Severance
Agreement between Employee and the Company (or the Company’s predecessor) dated
              ,
2005 (“Severance Agreement”), which payment includes all amounts, if any, which
are owed to Employee pursuant to any agreement, plan or policy of the Company
arising from a “Change of Control” of the Company, as defined in the Severance
Agreement, if such amount has not been previously paid to Employee.

 

Employee agrees
that no further amount is or shall be due or claimed to be due from the Company
and/or from any other person or entity released in paragraph 3 below except for
any post-termination payment amounts owed to Employee pursuant to employee
benefit plans qualified under the Employee Retirement Income Security Act of
1974, as amended (“ERISA”), or pursuant to the applicable requirements of Part 6
of Subtitle B of Title I of ERISA and Section 4980B of the Internal
Revenue Code of 1986, as amended (“COBRA”), or any payments to or rights of
Employee hereunder or under the Employee’s Supplemental Executive Retirement
Plan dated April 15, 2003, the 1999 Phantom Stock Plan, the Euramax
International, Inc. 2003 Equity Compensation Plan (the “Equity Plan”) (or
underlying agreements), the Restricted Stock Agreement pursuant to the Equity
Plan, the Euramax International, Inc. 2005 Retention Bonus Program or any
shareholder agreement relating to Euramax International, Inc. to which Employee
is a party, or any rights Employee may have pursuant to any indemnification
provided by Euramax International, Inc. (such payments or rights set forth
in this paragraph collectively the “Surviving Obligations”).

 

3.             Release
. In consideration of the payment provided for in paragraph 2 above and
other good and valuable consideration, the receipt, adequacy, and sufficiency
of which are hereby acknowledged, Employee and his or her heirs, executors,
administrators, agents, assigns, and any other representative or entity acting
on his, her or their behalf, do hereby now and forever unconditionally release,
discharge, acquit and hold harmless the Company [and Euramax
International, Inc. (“Parent”),] and any of their affiliates or
related companies, and any and all of their employees, directors, officers,
shareholders, agents, administrators, assigns, and any other representative or
entity acting on their behalf (collectively the “Released Parties”), from any
and all claims, rights, demands, actions, suits, damages, losses, expenses,
liabilities, indebtedness, and

 

 

causes of action, of
whatever kind or nature that existed from the beginning of time through the
date he or she executes this Release, regardless of whether known or unknown,
and regardless of whether asserted by Employee to date, other than any rights
under the Surviving Obligations.

 

4.             Enforcement.
In the event of a default or breach of this Release, each party may pursue
whatever legal or equitable remedies that may be available to such party to
seek judicial enforcement of this Release, whether by injunction, specific
performance, an action for damages or otherwise.

 

5.             Jurisdiction.
The laws of the State of Delaware shall govern this Release, unless pre-empted
by any applicable federal law.

 

6.             General.
This Release may be signed in counterparts with the same force and effect as if
signed in a single document. No provision of this Release may be modified or
waived except by a written agreement signed by each of the parties hereto. This
Release contains the entire agreement of the parties, and supersedes any and
all prior or contemporaneous understandings, agreements, representations and/or
promises, whether oral or written, which are not expressly set forth herein or
expressly referred to herein.

 

7.             OWBPA
Rights. Employee is advised to seek legal counsel regarding the terms of
this Release.  Employee acknowledges that
he or she has either sought legal counsel or has consciously decided not to
seek legal counsel regarding the terms and effect of this Release. Employee
acknowledges that this Release releases only those claims which exist as of the
date he or she executes this Release.

 

(a)           Employee
acknowledges that he or she make take up to a period of forty-five (45) days
from the date of receipt of this Release within which to consider and sign this
Release, but he or she may also choose to sign and return it earlier.

 

(b)           Employee
acknowledges that he or she will have seven (7) days from the date of
signing this Release to revoke the Release in writing in its entirety (“Revocation
Period”).  Employee acknowledges that the
Release will not become effective or enforceable until the Revocation Period
has expired.  In the event the Employee
chooses to revoke this Release, within the Revocation Period, he or she will:

 

(i).           Revoke the entire Release in a signed
writing, delivered to the following person on or before the seventh (7th)
day after he or she executed the Release:

 

	
   

  
	
   

  

 

(ii)           Forfeit
all severance payments rights that are contemplated by this Release.

 

(c)           The
Effective Date of this Release shall be the eight (8th) day after
the date Employee signs the Release, assuming the Employee has not properly
revoked the Release in writing within the Revocation Period.

 

(d)           Employee
acknowledges receipt, in Schedule 1 attached hereto, of a list of
job titles and ages of all the employees of the Company and of all entities
controlled by or under common control with the Company who were selected for
participation in the employment

 

2

 

termination program (as
such term is entitled in 29 USC §626(f)(1)(F)(ii)) in which Employee
participates and a list of job titles and ages of all such employees in the
same job classification(s) as such participants but who were not selected for
such participation.

 

(e)           Employee
expressly acknowledges that the payments and the other consideration that he or
she is receiving under the Release constitute material consideration for his or
her execution of this Release, and represent valuable consideration to which he
or she would not otherwise be entitled.

 

3

 

IN
WITNESS WHEREOF, the undersigned have executed this Release
on the date set forth below.

 

	
   

  	
  EMPLOYEE:

  
	
  Subscribed before me
  this the

  	
   

  
	
          
  day of                             ,
            

  	
   

  	
   

  
	
   

  	
  Signature of Employee

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Notary Public

  	
  Printed Name of
  Employee

  
	
   

  	
   

  
	
  My commission expires:

  	
  Date:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [Insert Name of Employer]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  
													

 

4

 

Schedule 1

 

Participants

 

	
  Job Title

  	
   

  	
  Ages

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

Non Participants

 

	
  Job Title

  	
   

  	
  Ages

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

5Exhibit
10.13

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered
into effective as of the 19th day of August, 2004, by and between EVANS &
SUTHERLAND COMPUTER CORPORATION, a Utah corporation (the “Company”) and
Kevin A. Paprzycki (the “Executive”).

 

W I T N E S S E T H:

 

WHEREAS, the Executive has provided services to the Company in an
executive capacity and desires to continue to provide such services;

 

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

 

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

 

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

 

NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements hereinafter set forth, the Company and the Executive
hereto mutually covenant and agree as follows:

 

1.                                       DEFINITIONS.

 

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

 

(a)                                  “Accrued
Benefits” shall mean the amount equal to the sum of the following to the
extent not previously paid:

 

(i)                                     All salary earned
or accrued through the Termination Date;

 

(ii)                                  Reimbursement
pursuant to Section 6(d) for any and all monies expended by the Executive
and not advanced by Company in connection with the Executive’s employment for
reasonable and necessary expenses incurred by the Executive through the
Termination Date;

 

(iii)                               Any and all other cash
benefits of deferred compensation plans previously earned through the
Termination Date unless deferred at the election of

 

 

the
Executive for payment at another time or the applicable deferred compensation
plan provides for payment at another time;

 

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

 

(v)                                 All
other payments and benefits to which the Executive may be entitled under the
terms of any benefit plan of the Company, which as of the Termination Date, is
applicable to all regular full-time employees of the Company generally.

 

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

 

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

 

(d)                                 “Base
Period Income” shall be an amount equal to the Executive’s “annualized
includable compensation” for the “base period” as defined in Sections
280G(d)(1) and (2) of the Code and the regulations adopted thereunder;

 

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

 

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

 

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

 

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

 

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

 

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

 

2

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

3

 

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

 

(vii)                           The filing of a proceeding
under Chapter 11 of the Federal Bankruptcy Code (or any successor or other
statute of similar import) for reorganization with respect to the Company if in
connection with any such proceeding, this Agreement is rejected, or a plan of
reorganization is approved an element of which plan entails the liquidation of
all or substantially all the assets of the Company.

 

A “Change of Control”
shall be deemed to occur on the actual date on which any of the foregoing
circumstances shall occur; provided, however, that in connection with a “Change
of Control” specified in Section 1(h)(vii), a “Change
of Control” shall be deemed to occur on the date of the filing of the relevant
proceeding under Chapter 7 or Chapter 11 of the Federal Bankruptcy Code (or any
successor or other statute of similar import). 
Notwithstanding the foregoing, a “Change of Control” shall not include
any transaction that constitutes a “Rule 13e-3 transaction” under Rule 13e-3 of
the Act or an “issuer tender offer” under Rule 13e-4 of the Act.

 

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

 

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

 

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

 

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

 

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

 

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

 

(ii)                                  Breach or violation
of any material provision of this Agreement by the Company, which is not
remedied within five business days following notice to the Company by the
Executive.

 

(n)                                 “Good
Reason During a Change of Control” shall mean any
of the following events occurring during a Change of Control Period:

 

4

 

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

 

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

 

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

 

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

 

(o)                                 “Gross
Income” shall mean the Executive’s current calendar year targeted
compensation under Sections 6(a) and (b) of this Agreement;

 

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

 

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

 

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

 

(i)                                     The Executive’s
date of death;

 

(ii)                                  Thirty (30) days
after the delivery of the Notice of Termination terminating the Executive’s
employment on account of Disability pursuant to Section 9 herein, unless
the Executive returns on a full-time basis to the performance of his or her
duties prior to the expiration of such period;

 

5

 

(iii)                               Thirty
(30) days after the delivery of the Notice of Termination if the Executive’s
employment is terminated by the Executive voluntarily;

 

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

 

(v)                                 The
date the Executive is terminated for Cause.

 

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

 

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

 

2.                                       EMPLOYMENT.

 

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

 

3.                                       TERM.

 

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

 

4.                                       POSITIONS
AND DUTIES.

 

The Executive shall serve as Chief Financial Officer and Secretary of
the Company and in such additional capacities as set forth in Section 7
herein.  In connection with the foregoing
positions, the Executive shall have such duties, responsibilities and authority
as may from time to time be assigned to the Executive by the Chief Executive
Officer.  The Executive shall devote
substantially all the Executive’s working time and efforts to the business and
affairs of the Company.  The Chief
Executive Officer, in his or her sole discretion, may alter, modify, or change
the Executive’s duties, offices, positions, responsibilities and obligations
set forth in this Agreement at any time, consistent with the status of a senior
executive of the Company.

 

5.                                       PLACE
OF PERFORMANCE.

 

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

 

6

 

6.                                       COMPENSATION
AND RELATED MATTERS.

 

(a)                                  Salary.  The Company shall pay to the Executive an
annualized base salary at a rate of $135,000.00 in equal installments as nearly
as practicable on the Company’s regular payroll dates, in arrears.  Such annualized base salary may be increased
from time to time in accordance with normal business practices of the
Company.  The annualized base salary of
the Executive shall not be decreased below its then existing amount during the
term of this Agreement;

 

(b)                                 MIP.  Subject to the Company’s right to terminate
or amend, at any time with or without notice to the Executive, the Evans &
Sutherland Management Incentive Plan (the “MIP”), the Executive shall be
entitled to participate in the MIP as agreed in writing in a MIP document;

 

(c)                                  Executive
Savings Plan.  Subject to the Company’s
right to terminate or amend, at any time with or without notice to the
Executive, the Company’s Executive Savings Plan, the Executive shall be
entitled to participate in the Executive Savings Plan according to the terms
and conditions of the Executive Savings Plan.

 

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

 

(e)                                  Other
Benefits.  The Company shall provide
the Executive with all other benefits normally provided to an employee of the
Company similarly situated to the Executive, including being added as a named officer on the Company’s existing
directors’ and officers’ liability insurance policy.  Such D&O policy and replacement or
successor policies, including any extended reporting period for a current
policy in the event the current policy is written on a claims made basis, shall
provide continuous coverage for claims which may be brought against Executive
in connection with Executive’s employment while a named officer of the Company
regardless of when a claim is made, including claims brought post-termination.
 In the event of a Change of Control, the Executive will be a named
officer under a policy that provides continuous coverage comparable to coverage
in effect before the Change of Control.

 

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

 

(g)                                 Services
Furnished.  The Company shall furnish
the Executive with office space, and such other facilities and services as
shall be suitable to the Executive’s position and adequate for the performance
of the Executive’s duties as set forth in Section 4 hereof.

 

7

 

7.                                       OFFICES.

 

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

 

8.                                       TERMINATION
AS A RESULT OF DEATH.

 

If the Executive shall die during the term of this Agreement, the
Executive’s employment shall terminate on the Executive’s date of death and the
Executive’s surviving spouse, or the Executive’s
estate if the Executive dies without a surviving spouse, shall be entitled to
the Executive’s Accrued Benefits as of the Termination Date and the applicable
Termination Payment.

 

9.                                       TERMINATION
FOR DISABILITY.

 

If, as a result of the Executive’s Disability, the Executive shall have
been unable to perform the Executive’s duties hereunder on a full-time basis
for four (4) consecutive months and within thirty (30) days after the Company
provides the Executive with a Termination Notice, the Executive shall not have
returned to the performance of the Executive’s duties on a full-time basis, the
Company may terminate the Executive’s employment, subject to Section 14
herein.  During the term of the Executive’s
Disability prior to termination, the Executive shall continue to receive all
salary and other benefits payable under Section 6 herein, including
participation in all employee benefit plans, programs and arrangements in which
the Executive was entitled to participate immediately prior to the Disability; provided,
however, that the Executive’s continued participation is permitted under the
terms and provisions of such plans, programs and arrangements.  In the event that the Executive’s
participation in any such plan, program or arrangement is barred as the result
of such Disability, the Executive shall be entitled to receive an amount equal
to the contributions, payments, credits or allocations which would have been
paid by the Company to the Executive, to the Executive’s account or on the
Executive’s behalf under such plans, programs and arrangements.  In the event the Executive’s employment is
terminated on account of the Executive’s Disability in accordance with this Section 9,
the Executive shall receive the Executive’s Accrued Benefits as of the Termination
Date and shall remain eligible for all benefits provided by any long-term
disability programs of the Company in effect at the time of such termination.  The Executive shall also be entitled to the
Termination Payment described in Section 13(a).

 

10.                                 TERMINATION
FOR CAUSE.

 

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

 

8

 

11.                                 OTHER
TERMINATION BY COMPANY.

 

From and after the date of this Agreement, provided that the Company
furnishes thirty (30) days prior written notice to the Executive, the Company
shall have the right to terminate this Agreement at any time, with or without
Cause.  If the Executive’s employment
with the Company is terminated by the Company other than by reason of death,
Disability or Cause, subject to the procedures set forth in Section 14
herein, the Executive (or in the event of the Executive’s death following the
Termination Date, the Executive’s surviving spouse or the Executive’s estate if
the Executive dies without a surviving spouse) shall receive the Executive’s
Accrued Benefits and the applicable Termination Payment.  The Executive shall not, in connection with
any consideration receivable in accordance with this Section 11, be
required to mitigate the amount of such consideration by securing other
employment or otherwise and such consideration shall not be reduced by reason
of the Executive securing other employment or for any other reason.

 

12.                                 VOLUNTARY
TERMINATION BY EXECUTIVE.

 

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

 

13.                                 TERMINATION
PAYMENT.

 

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

 

(b)                                 If,
prior to a Change of Control Period, the Executive’s employment is terminated
by the Executive for Good Reason or by the Company other than by reason of
death, Disability or Cause, the Termination Payment payable to the Executive by
the Company or an affiliate of the Company shall be one (1.0) times the
Executive’s Gross Income.  The Company
will pay the full medical, dental, and vision premiums for continuation
coverage under COBRA for the Executive and dependents who qualify for continuation
coverage under COBRA for one year following the Termination Date.

 

9

 

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

 

(d)                                 It
is the intention of the Company and the Executive that the benefits under this
Agreement shall be capped such that no portion of the Termination Payment and
any other “payments in the nature of compensation” (as defined in Section 280G
of the Code and the regulations adopted thereunder) to or for the benefit of
the Executive under this Agreement, or under any other agreement, plan or
arrangement, shall be deemed to be an “excess parachute payment” as defined in Section 280G
of the Code.  It is agreed that the
present value of the Total Payments shall not exceed an amount equal to two and
ninety-nine hundredths (2.99) times the Executive’s Base Period Income, which
is the maximum amount which the Executive may receive without becoming subject
to the tax imposed by Section 4999 of the Code or which the Company may
pay without loss of deduction under Section 280G(a)
of the Code.  Present value for purposes
of this Agreement shall be calculated in accordance with the regulations issued
under Section 280G of the Code. 
Within sixty (60) days following delivery of the Notice of Termination
or notice by the Company to the Executive of its belief that there is a payment
or benefit due the Executive which will result in an excess parachute payment
as defined in Section 280G of the Code, the Executive and the Company
shall, at the Company’s expense, obtain such opinions as more fully described
hereafter, which need not be unqualified, of legal counsel and certified public
accountants or a firm of recognized executive compensation consultants.  The Executive shall select said legal
counsel, certified public accountants and executive compensation consultants;
provided, however, that if the Company does not accept one (1) or more of the
parties selected by the Executive, the Company shall provide the Executive with
the names of such legal counsel, certified public accountants and/or executive
compensation consultants as the Company may select; provided, further, however,
that if the Executive does not accept the party or parties selected by the
Company, the legal counsel, certified public accountants and/or executive
compensation consultants selected by the Executive and the Company,
respectively, shall select the legal counsel, certified public accountants
and/or executive compensation consultants, whichever is applicable, who shall
provide the opinions required by this Section 13(d).  The opinions required hereunder shall set
forth (a) the amount of the Base Period Income of the Executive, (b) the
present value of Total Payments and (c) the amount and present value of any
excess parachute payments.  In the event
that such opinions determine that there would be an excess parachute payment,
the Termination Payment or any other payment determined by such counsel to be
includable in Total Payments shall be reduced or eliminated as specified by the
Executive in writing delivered to the Company within thirty (30) days of his or
her receipt of such opinions or, if the Executive fails to so notify the
Company, then as the Company shall reasonably determine, so that under the
bases of calculation set forth in such opinions there will be no excess
parachute payment.  The provisions of
this Section 13(d), including the

 

10

 

calculations, notices and
opinions provided for herein shall be based upon the conclusive presumption
that the compensation and other benefits, including but not limited to the
Gross Income, earned on or after the date of a Change of Control by the
Executive pursuant to the Company’s compensation programs if such payments
would have been made in the future in any event, even though the timing of such
payment is triggered by the Change of Control, are reasonable compensation for
services rendered prior to the Change of Control; provided, however, that in
the event legal counsel so requests in connection with the opinion required by
this Section 13(d), a firm of recognized executive compensation
consultants, selected by the Executive and the Company pursuant to the procedures
set forth above, shall provide an opinion, upon which such legal counsel may
rely, as to the reasonableness of any item of compensation as reasonable
compensation for services rendered prior to the Change of Control by the
Executive.  In the event that the
provisions of Sections 280G and 4999 of the Code are repealed without
succession, this Section 13(d) shall be of no further force or effect.

 

(e)                                  The
Termination Payment shall be paid to the Executive as follows:

 

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

 

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

 

(f)                                    Notwithstanding
anything to the contrary herein, in no event will a termination of the
Executive’s employment with the Company be deemed to trigger a right to receive
a Termination Payment if the termination is effected by the mutual written agreement
of the Company and the Executive to accommodate a reassignment of the Executive
to an entity created or acquired by the Company, or to which the Company has
contributed rights to technology, assets or business plans, if at the time of
such termination the Company owns or is acquiring a minimum of a 19% equity
interest in such entity.  In the event of
any such termination, the Executive shall only be entitled to receive the
Executive’s Accrued Benefits as of the Termination Date.

 

11

 

14.                                 TERMINATION
NOTICE AND PROCEDURE.

 

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

 

(a)                                  The
Notice of Termination shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail the facts and circumstances
alleged to provide a basis for termination;

 

(b)                                 Any
Notice of Termination by the Company shall be approved by a resolution duly
adopted by a majority of the Board, or a majority of the Board may delegate
such authority to approve any Notice of Termination to the Chief Executive
Officer of the Company;

 

(c)                                  If
the Executive shall in good faith furnish a Notice of Termination for Good
Reason or for Good Reason During a Change of Control and the Company notifies
the Executive that a dispute exists concerning the existence of Good Reason or Good
Reason During a Change of Control, within the fifteen (15) day period following
the Company’s receipt of such notice, the Executive shall continue the
Executive’s employment during such dispute. 
If it is thereafter agreed by the parties to this Agreement or
determined by arbitration that (i) Good Reason or Good Reason During a Change
of Control did exist, the Executive’s Termination Date shall be the earlier of
(A) the date on which the dispute is finally determined, either by mutual
written agreement of the parties or pursuant to Section 16, (B) the date
of the Executive’s death or (C) one day prior to the second (2nd) anniversary
of a Change of Control, if any,  or
(ii) Good Reason or Good Reason During a Change of Control did not exist,
the employment of the Executive shall continue after such determination as if
the Executive had not delivered the Notice of Termination asserting Good Reason
or Good Reason During a Change of Control; and

 

(d)                                 If
the Executive gives Notice of Termination of his or her employment for Good
Reason or Good Reason During a Change of Control and a dispute arises as to the
existence of Good Reason or Good Reason During a Change of Control, and the
Executive does not continue his employment during such dispute, and it is
finally determined that the reason for termination set forth in such Notice of
Termination did not exist, if such notice was delivered by the Executive, the
Executive shall be deemed to have voluntarily terminated the Executive’s
employment other than for Good Reason or Good Reason During a Change of
Control.

 

15.                                 NON-COMPETE.

 

The Executive hereby agrees that during the term of this Agreement and
for the period of one (1) year from the
termination hereof, that the Executive will not:

 

(a)                                  Own,
manage, operate or control any business within the United States of the type
and character engaged in and competitive with the Company or any subsidiary

 

12

 

thereof.  For purposes of this Section 15,
ownership of securities of not in excess of five percent (5%) of any class of
securities of a public company shall not be considered to be competition with
the Company or any subsidiary thereof; or

 

(b)                                 Act
as, or become employed as, an officer, director, employee, consultant or agent
of any business within the United States of the type and character engaged in
and competitive with the Company or any of its subsidiaries; or

 

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

 

(d)                                 Solicit
the employment of (i) any employee of the Company or its subsidiaries that is
an employee at anytime during this term of this Agreement or during the one
year period following the termination of this Agreement or (ii) any former
employee of the Company or its subsidiaries who was employed by the Company or
its subsidiaries during the one (1) year period preceding the Termination Date.

 

For purposes of this Section 15, any business in
the design, production, sale or support of 3D visualization simulation hardware
or software systems shall be deemed to be competitive with the Company.

 

16.                                 REMEDIES
AND JURISDICTION.

 

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

 

(b)                                 All
claims, disputes and other matters in question between the parties arising
under this Agreement, shall, unless otherwise provided herein, be decided by
binding arbitration before a single independent arbitrator selected pursuant to
Section 16(d).  TO THE EXTENT
ALLOWABLE UNDER APPLICABLE LAW, ALL DISPUTES INVOLVING ALLEGED UNLAWFUL
EMPLOYMENT DISCRIMINATION, BREACH OF CONTRACT OR POLICY, OR EMPLOYMENT TORT
COMMITTED BY THE COMPANY OR A REPRESENTATIVE OF THE COMPANY, INCLUDING CLAIMS
OF VIOLATIONS OF FEDERAL OR STATE DISCRIMINATION STATUTES OR PUBLIC POLICY,
SHALL BE RESOLVED PURSUANT TO THIS POLICY AND THERE SHALL BE NO RECOURSE TO

 

13

 

COURT, WITH OR WITHOUT A
JURY TRIAL.  The arbitration hearing
shall occur at a time and place convenient to the parties in Salt Lake County,
Utah, within thirty (30) days of selection or appointment of the
arbitrator.  The arbitration shall be
governed by the National Rules for the Resolution of Employment Disputes of AAA
in effect on the date of the first notice of demand for arbitration.  The arbitrator shall issue written findings
of fact and conclusions of law, and an award, within fifteen (15) days of the
date of the hearing unless the parties otherwise agree.

 

(c)                                  In
cases of breach of contract or policy, damages shall be limited to contract
damages.  In cases of discrimination
claims prohibited by statute, the arbitrator may direct payment consistent with
the applicable statute.  Issues of
procedure, arbitrability, or confirmation of award shall be governed by the
Federal Arbitration Act, 9 U.S.C. §§ 1-16.

 

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

 

17.                                 ATTORNEYS’
FEES.

 

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

 

18.                                 SUCCESSORS.

 

This Agreement and all rights of the Executive shall inure to the
benefit of and be enforceable by the Executive’s personal or legal
representatives, estates, executors, administrators, heirs and
beneficiaries.  In the event of the
Executive’s death, all amounts payable to the Executive under this Agreement
shall be paid to the Executive’s surviving spouse, or
the Executive’s estate if the Executive dies without a surviving spouse.  This Agreement shall inure to the benefit of,
be binding upon and be enforceable by, any successor, surviving or resulting
corporation or other entity to which all or substantially all of the business
and assets of the Company shall be transferred whether by merger,
consolidation, transfer or sale.

 

19.                                 ENFORCEMENT.

 

The provisions of this Agreement shall be regarded as divisible, and if
any of said provisions or any part hereof are declared invalid or unenforceable
by a court of competent jurisdiction, the validity and enforceability of the
remainder of such provisions or parts hereof and the applicability thereof
shall not be affected thereby.

 

14

 

20.                                 AMENDMENT
OR TERMINATION.

 

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

 

21.                                 SURVIVABILITY.

 

The provisions of Sections 15, 16, 17, 18 and 19 and the Company’s
obligation to pay Executive monies or benefits due hereunder shall survive
termination of this Agreement.

 

22.                                 ENTIRE
AGREEMENT.

 

Except for the Confidentiality, Proprietary Information, and Inventions
Agreement between the Executive and the Company, this Agreement sets forth the
entire agreement between the Executive and the Company with respect to the terms
of the Executive’s employment with the Company. 
This Agreement supersedes all prior oral or written agreements,
negotiations, commitments and understandings with respect thereto, and in the
event of conflict between the terms of this Agreement and any other agreement,
the terms of this Agreement govern.  Prior Employment Agreements
between the Executive and the Company are hereby terminated in their entirety
and superceded by this Agreement.

 

23.                                 GOVERNING
LAW.

 

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

 

24.                                 NOTICE.

 

All notices,
requests, instructions or other documents to be given under this Agreement
shall be in writing and shall be deemed given (i) three business days following
sending by registered or certified mail, postage prepaid, (ii) when delivered,
if delivered personally to the intended recipient and (iv) one business day
following sending by overnight delivery via a national courier service, and in
each case, addressed to a party at the following address for such party:

 

	
  Company:

  	
   

  	
  Evans & Sutherland
  Computer Corporation

  
	
   

  	
   

  	
  600 Komas Drive

  
	
   

  	
   

  	
  Salt Lake City, Utah
  84108

  
	
   

  	
   

  	
  Attn: Vice President of
  Human Resources

  
	
   

  	
   

  	
  Fax: (801) 588-4517

  
	
   

  	
   

  	
  Tel: (801) 588-1609

  

 

15

 

	
  Executive:

  	
   

  	
  Kevin A. Paprzycki

  
	
   

  	
   

  	
  6413 W. Ketchum Drive

  
	
   

  	
   

  	
  West Valley City, Utah
  84128

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tel: (801) 508-1589

  

 

or
to such other address as the Company shall have given to the Executive or the
Executive shall have given to the Company in writing in the manner set forth
above.

 

25.                                 NO
WAIVER.

 

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

 

26.                                 HEADINGS.

 

The headings herein contained are for reference only and shall not
affect the meaning or interpretation of any provision of this Agreement.

 

16

 

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

 

	
   

  	
   

  	
  “COMPANY”

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  EVANS & SUTHERLAND
  COMPUTER

  CORPORATION, a Utah
  Corporation

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ James R. Oyler

  	
   

  
	
   

  	
   

  	
   

  	
  James R. Oyler

  
	
   

  	
   

  	
   

  	
  President and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “EXECUTIVE”

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Kevin A. Paprzycki

  	
   

  
	
   

  	
   

  	
   

  	
  Kevin A. Paprzycki

  
							

 

17

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