MACROVISION CORPORATION EXECUTIVE SEVERANCE AND ARBITRATION AGREEMENT

 

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                                                                    Exhibit 10.1

 

 

                             MACROVISION CORPORATION

                  EXECUTIVE SEVERANCE AND ARBITRATION AGREEMENT

 

 

        THIS EXECUTIVE SEVERANCE AND ARBITRATION AGREEMENT (the "Agreement") is

made and entered into as of February 3, 2005 by and between Macrovision

Corporation, a Delaware corporation (the "Company") and James Wickett

("Executive").

 

        WHEREAS, the Board of Directors (the "Board") of the Company has

recommended and authorized the Company to enter into a severance agreement in

the form hereof with Executive; and

 

        WHEREAS, the Board has determined that, in the event of a possible

threatened or pending sale or other change in control of the Company, it is

imperative that the Company and the Board be able to rely upon Executive to

continue in Executive's position, and that the Company be able to receive and

rely upon Executive's advice, if requested, as to the best interests of the

Company and its stockholders without concern that Executive might be distracted

by the personal uncertainties and risks created by any such possible

transactions; and

 

        WHEREAS, in connection with the foregoing, Executive may, in addition to

Executive's regular duties, be called upon to assist in the assessment of any

such possible transactions, advise management and the Board as to whether such

proposals would be in the best interests of the Company and its stockholders,

and to take such other actions as the Board might determine to be appropriate;

 

        NOW, THEREFORE, to assure the Company that it will have the continued

dedication of Executive and the availability of Executive's advice and counsel

through the occurrence of any Change in Control (as defined in Section 1(b)

below) of the Company, and to induce Executive to remain in the employ of the

Company, and for other good and valuable consideration, the Company and

Executive agree as follows:

 

        1.      PAYMENT OF SEVERANCE BENEFIT.

 

                (a)     In the event that a Change in Control (as hereinafter

defined) occurs and, within the period beginning ninety (90) days before the

date of the Change in Control and ending twelve (12) months thereafter, (a)

Executive's employment is terminated by the Company or a Subsidiary (as

hereinafter defined) without Cause (as hereinafter defined) or (b) Executive

voluntarily terminates his/her employment with Company and its Subsidiaries with

Good Reason (as hereinafter defined), then the Company shall pay to Executive

severance pay under this Agreement. Transfer of Executive's employment from the

Company to a Subsidiary (or to an entity of which the Company is a Subsidiary)

or from a Subsidiary to the Company or to another Subsidiary (or to an entity of

which the Company is a Subsidiary), shall not be considered a termination of

Executive's employment. Such severance pay shall be in the form of salary

continuation of Executive's regular base pay in effect ninety (90) days before

the time of

 

 

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the Change in Control or at the time of the termination of his employment,

whichever is greater. The Company shall pay such severance pay during the twelve

(12) month period immediately following the date on which Executive's employment

with the Company terminates; provided, however, that, if Executive commences new

employment within such twelve (12) month period, such severance pay shall cease

on the later of (i) the date six (6) months after Executive's employment with

the Company terminates or (ii) the date Executive commences new employment.

 

                (b)     "CHANGE IN CONTROL" means any of the following events:

(i) any "person" or "group" (as defined in or pursuant to Sections 13(d) or

14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"))

other than the Company, is or becomes the "beneficial owner" (as defined in Rule

13d-3 promulgated under the Exchange Act), directly or indirectly (including by

holding securities which are exercisable for or convertible into shares of

capital stock of the Company), of securities of the Company representing 50% or

more of the voting power of the outstanding shares of capital stock of the

Company entitled to vote generally in the election of directors; (ii) the

Company sells or exchanges, through merger, assignment or otherwise, in one or

more transactions, other than in the ordinary course of business, assets which

provided at least seventy percent (70%) of the revenues or pre-tax net income of

the Company and its Subsidiaries on a consolidated basis during the most

recently completed fiscal year; or (iii) Continuing Directors cease to

constitute at least a majority of the Board. "Continuing Directors" are (A) each

director serving on the Board on January 1, 2005, and (B) any successor to any

such director whose nomination or selection was approved by a majority of the

directors in office at the time of the director's nomination or selection.

Notwithstanding the foregoing, the following events shall not constitute a

Change in Control: any acquisition of beneficial ownership pursuant to (i) a

reclassification, however effected, of the Company's authorized common stock, or

(ii) a corporate reorganization involving the Company or a Subsidiary which does

not result in a material change in the ultimate ownership by the stockholders of

the Company (through their ownership of the Company or its successor resulting

from the reorganization) of the assets of the Company and its Subsidiaries, but

only if such reclassification or reorganization has been approved by the Board.

 

                (c)     "CAUSE" means the occurrence of any one or more of the

following: (i) conviction of any felony or any act of fraud, misappropriation or

embezzlement which has an immediate and materially adverse effect on the Company

or a Subsidiary; (ii) engaging in a fraudulent act to the material damage or

prejudice of the Company or a Subsidiary or in conduct or activities materially

damaging to the property, business or reputation of the Company or a Subsidiary;

(iii) failure to comply in any material respect with the terms of any applicable

employment agreement or any written policies or directives of the Board which

have an immediate and materially adverse effect on the Company or a Subsidiary

and which has not been corrected within 30 days after written notice from the

Company of such failure; (iv) any material act or omission involving malfeasance

or negligence in the performance of employment duties which has an immediate and

materially adverse effect on the Company or a Subsidiary and which has not been

corrected within 30 days after written notice from the Company; or (v) material

breach of any other agreement with the Company, which has an immediate and

materially adverse effect on the Company or a Subsidiary and which has not been

cured within 30 days after written notice from the Company of such breach.

 

 

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                (d)     "GOOD REASON" means the occurrence of any of the

following without the Executive's consent: (i) a substantial diminution in the

Executive's status, position or responsibilities, or the assignment to the

Executive of any duties or responsibilities that are inconsistent with the

Executive's status, position or responsibilities; (ii) a reduction in the

Executive's base salary; or (iii) a relocation of the Executive's principal

place of employment to a new work site requiring an increase in one-way commute

from Executive's residence of more than thirty-five (35) miles.

 

                (e)     "SUBSIDIARY" means (i) any corporation, foreign or

domestic, in which the Company directly or indirectly owns 50% or more of the

issued and outstanding voting stock on an "as converted basis" or (ii) any

partnership, foreign or domestic, in which the Company owns a direct or indirect

interest equal to 50% or more of the outstanding equity interests.

 

        2.      WELFARE BENEFITS.

 

                (a)     During the period that Company is obligated to pay

Executive severance pay pursuant to Section 1(a) above, or, if sooner, until

Executive is entitled to Welfare Benefits (as defined below) under any plan

maintained by any entity employing Executive after Executive's employment with

the Company terminates, Company shall provide to Executive (and his/her spouse

and other qualified dependents) all Welfare Benefits that Company provided to

Executive (and his/her spouse and qualified dependents) immediately prior to the

Change in Control. For purposes of this Agreement, the term "Welfare Benefits"

shall include, without limitation, all life, dental, health, accident and

disability benefit plans, other similar welfare plans, and any equivalent

successor policy, plan, program or arrangement that may now exist or be adopted

hereafter by the Company or a Subsidiary. Notwithstanding the foregoing, with

respect to any Welfare Benefits provided thr