Exhibit 10.78

 

May 20, 2005

 

Howard E. Goldberg

 

Re: Severance Agreement and General Release

 

Dear Howard:

 

We are interested in resolving amicably your separation of employment with
InterDigital Communications Corporation (“the Company”), effective May 2, 2005
(“Termination Date”). Toward this end, we propose the following Severance
Agreement, which includes a General Release (“Agreement”).

 

The terms and conditions set forth in Paragraph 1 below will apply regardless of
whether you elect to sign this Agreement. However, the severance payments and
other benefits set forth in Paragraph 2 below are contingent on your signing
this Agreement.

 

You may consider for forty-five (45) days whether you wish to sign this
Agreement. You are encouraged to review the proposed Agreement with your
attorney.

 

1. As noted above, regardless of whether you sign this Agreement:

 

(a) Your last day of employment will be your Termination Date. You will be paid
for all time worked up to and including your Termination Date.

 

(b) You will be paid for accrued but unused Paid Time Off (PTO) on the next
regular pay period following payroll’s receipt of your final timesheet, in
accordance with Company policy.

 

(c) Your eligibility to participate in Company sponsored medical, dental and/or
vision insurance plans will cease effective your last day of employment.
However, you will be eligible to continue such benefits, at your sole expense,
pursuant to the Consolidated Omnibus Budget Reconciliation Act (“COBRA”),
subject to COBRA’s terms, conditions and restrictions. (Please see Paragraph
2(b) below for what will occur in the event you sign this Agreement.)

 

(d) Your participation in all other Company sponsored group benefits including
group life, disability and accidental death and dismemberment coverage will
cease effective your last day of employment. However, you may be eligible to
convert your life insurance coverage to a private policy, at your sole expense,
subject to the insurer’s terms, conditions and restrictions. If you wish to
convert your life insurance policy to a private policy, please contact Human
Resources to receive the appropriate paperwork.

--------------------------------------------------------------------------------

(e) Your active participation in the Company’s 401(k) Savings Plan or Employee
Stock Purchase Plan shall cease effective your Termination Date provided,
however, that all amounts due to your 401k plan account or stock purchase plan
account with reference to contributions relating to periods on or before the
Termination Date shall nevertheless be made in accordance with relevant plan
provisions and statutory requirements and limitations. You will receive detailed
information from the Company’s 401K Plan provider (Diversified Investments
Advisors) regarding your 401(k) Plan fund status and disbursement options.

 

(f) Your active participation in the Company’s Flexible Reimbursement Account
will cease effective on your Termination Date. You will have a set amount of
time following your last day of employment to submit claims for reimbursement
under this Plan. Details will be provided by Human Resources.

 

(g) All vested stock options previously granted to you by the Board will
terminate in accordance with the terms of the applicable Stock Option Plan under
which they were granted. Any non-vested options will terminate effective your
last day of employment. A schedule setting forth your holdings has been provided
to you. You are responsible for reviewing the applicable Stock Option Plan and
Option Grant and determining the expiration date of your options. If you need
assistance, please contact the Company’s stock plan administrator.

 

(h) You will receive a pro-rata portion of your LTIP cash bonus and RSU award
under the two Program cycles currently in effect in accordance with the terms of
the InterDigital Corporation Long Term Compensation Program.

 

(i) The restricted stock granted as part of your annual bonus in the last two
fiscal years will remain restricted as to transferability as set forth in the
related award agreements.

 

2. If you sign this Agreement, agreeing to be bound by the General Release set
forth in Paragraph 3 below and the other terms and conditions of this Agreement,
the Company agrees as follows, intending to be legally bound:

 

(a) To pay you eighteen (18) months of severance pay at a rate equal to your
current monthly base salary, less withholding of all applicable income, social
security and other taxes and charges which are required to be withheld by the
Company. The severance payments will be paid to you in accordance with the
Company’s regular payroll practices. The first severance payment will be made to
you consistent with the first regular pay period following the expiration of the
Revocation Period set forth in paragraph 17 below, provided that the Company has
received an executed copy of this Agreement.

 

(b) To pay you as additional severance a total amount of $123,953.50, which is
equal to fifty percent (50%) of your current target bonus, payable in eighteen

--------------------------------------------------------------------------------

(18) equal monthly installments, less withholding of all applicable income,
social security and other taxes and charges which are required to be withheld by
the Company. These severance payments will commence and be paid along with the
payments to be made under paragraph 2(a) above, following expiration of the
Revocation Period set forth in Paragraph 17 below.

 

(c) To bear the cost of continuing your group health insurance benefits
(medical, dental and vision) under COBRA (except for that portion which would be
contributory by you if you were still employed by the Company) for 18 months
provided that you elect COBRA coverage and that you satisfy the statutory
eligibility criteria. Thereafter, your continued participation in the Company’s
group health plan pursuant to COBRA shall be at your sole expense. Your
execution of this Agreement confirms that upon receipt of the COBRA enrollment
forms you will elect to continue coverage and you authorize the deduction of the
applicable co-payment from your severance payments, unless you notify Human
Resources, in writing, of your intent not to elect COBRA. The Company’s
obligation to continue medical, dental and vision coverage will cease if you are
eligible to participate in a comparable medical plan (without a relevant
pre-existing condition exclusion) with a new employer. In such case, you agree
immediately to notify the Company by written notice to Gary Isaacs, Sr. Human
Resources Officer of this Company.

 

(d) To continue to provide reimbursement to you for the automobile lease
payments in the amount of $741.23 per month on the vehicle leased pursuant to
your employment contract through the automobile lease’s termination date
provided the terms of the lease remain unchanged and you provide the Company
with copies of monthly invoices through the lease’s termination date.

 

(e) To permit you to retain the iPAQ, the IBM Thinkpad T30 laptop computer and
the Samsung E105 cell phone provided to you by the Company, provided, however,
the Company shall have no obligation with respect to phone service past the
Termination Date.

 

(f) To lift the restrictions on transferability on the shares of restricted
stock referenced in paragraph 1.(i) above following expiration of the Revocation
Period.

 

(g) To reimburse you for outstanding, approved expense reports incurred on or
before the Termination Date which have not yet been processed provided such
expenses are reimbursable under Company policy and are accompanied by proper
documentation.

 

3. In consideration for the Company’s payments and other benefits set forth
above in Paragraph 2, you agree, intending to be legally bound, to release and
forever discharge the Company and its related or affiliated companies, and each
of their past, present and future officers, directors, attorneys, employees,
owners, partners, insurers,

--------------------------------------------------------------------------------

benefit plan fiduciaries and agents, and their respective successors and assigns
(collectively “Releasees”), jointly and severally, from any and all actions,
complaints, causes of action, lawsuits or claims of any kind (collectively
“Claims”), known or unknown, asserted or unasserted, which you, your heirs,
agents, successors or assigns ever had, now have or hereafter may have against
any Releasee arising out of any matter, occurrence, omission or event existing
or occurring prior to your execution of this Agreement, including, without
limitation: any claims relating to or arising out of your employment with and/or
termination of employment by the Company and/or any of its related and/or
affiliated companies; any claims for unpaid or withheld wages, severance,
benefits, bonuses, commissions and/or other compensation of any kind; any claims
for reimbursement of expenses of any kind; any claims arising under the Employee
Retirement Income Security Act; any claims for attorneys’ fees, costs or
expenses; any claims of discrimination and/or harassment based on age, sex,
race, religion, color, creed, disability, handicap, citizenship, national
origin, ancestry, sexual orientation, or any other factor protected by Federal,
State or Local law (such as the Age Discrimination in Employment Act, 29 U.S.C.
§621 et. sec ., Title VII of the Civil Rights Act of 1964, as amended, the
Americans with Disabilities Act, the Pennsylvania Human Relations Act and the
New York Human Rights Law) and any claims for retaliation thereunder; any claims
under the Family Medical Leave Act or any other federal, state or local laws
governing leaves of absence; any claims under the National Labor Relations Act;
any claims for violation of public policy; any claims arising under the
Sarbanes-Oxley Act of 2002, as amended from time to time; any claims for
retaliation and/or any whistleblower claims; any claims for emotional distress
or pain and suffering; and/or any other statutory or common law claims, now
existing or hereinafter recognized, known or unknown, including, but not limited
to, breach of contract, libel, slander, fraud, wrongful discharge, promissory
estoppel, equitable estoppel and misrepresentation.

 

4. You acknowledge and agree that the Company’s severance payments and other
benefits under Paragraph 2 above are adequate consideration to support your
General Release in Paragraph 3 above.

 

5. Nothing in this Agreement shall result in the forfeiture of any vested
benefits, or waive any Claims with regard to any vested benefits, under any
Company 401 (k) Savings Plan, Employee Stock Purchase Plan, deferred
compensation plans, or any other employee benefit plans of the Company or your
right to indemnity pursuant to your Indemnity Agreement dated as of March 19,
2003 for your conduct as an Officer or Director through your Termination Date.
The terms of this Agreement shall not be deemed to preclude your ability to
bring an action to enforce the Company’s obligations under this Agreement.

 

6. Regardless of whether you execute this Agreement, you are prohibited from
using or disclosing, directly or indirectly, for you own benefit or the benefit
of any person or entity, any of the confidential and proprietary information of
the Company (the “Confidential Information”). Such Confidential Information
includes but is not limited to, information regarding the Company’s sales and
marketing information and techniques,

--------------------------------------------------------------------------------

business plans, financial data, trade secrets (including without limitation any
technical information, hardware, software, algorithms, source code, object code,
drawings, sketches, designs, processes, procedures, formulae, data, reports,
computer programs, charts, improvements and any other technical information or
knowledge relating to the development, design and implementation of the
Company’s products and services), pricing lists, supplier lists and other
confidential supplier data, customer lists and other confidential customer data,
and any other information or knowledge concerning the Company and its business
or others that the Company does business with, whether or not in tangible form,
that is not otherwise publicly available. Further, you are required to execute
further documents or instruments required for patent prosecution. You are
reminded of your obligations under Sections 7, 8 and 9 of your Amended and
Restated Employment Agreement dated as of November 20, 2000 as well as your
obligations under your Non-Disclosure and Assignment of Ideas Agreement dated as
of February 28, 2005. Section 7, 8, 9, 11, 12, 13, 14, 19, 23 and 24 of the
Amended and Restated Employment Agreement survive termination of your employment
as well as your obligations under your Non-Disclosure and Assignment of Ideas
Agreement dated as of February 28, 2005, regardless of whether you execute this
Agreement.

 

7. You agree that in the event you receive from a third party a request or
demand, orally, in writing, electronically or otherwise, for the disclosure or
production of information which you acquired in the course of your employment
which is not generally known by or readily accessible to the public, you must
notify immediately, in writing, via certified mail, the Company’s General
Counsel at the following address: 781 Third Avenue, King of Prussia,
Pennsylvania 19406. Any and all documents relating to the request or demand
shall be included with the notification. You shall wait a minimum of ten (10)
days (or the maximum time permitted by such legal process, if less) after
sending the letter before making a disclosure or production to give the Company
time to determine whether the disclosure or production involves confidential
and/or proprietary information, in which event the Company may seek to prohibit
and/or restrict the production and/or disclosure and/or to obtain a protective
order with regard thereto. This provision covers, but is not limited to,
requests or demands in connection with judicial, administrative, arbitration and
all other adversarial proceedings. If the request or demand is in conjunction
with judicial, administrative, arbitration or other adversarial proceedings,
copies of all correspondence in your possession or control regarding the request
or demand shall be included with the information sent to the General Counsel.

 

8. Prior to the termination of your employment and as a condition precedent to
receiving the payments and other benefits set forth in paragraph 2 above, you
must return to the Company, retaining no copies, all Confidential Information,
keys, documents, correspondence, access cards, computer equipment, computer
tapes, disks, CDs, DVDs, manuals, engineering notebooks, customer information,
and any other property and information in either printed or electronic formats
which you obtained as a result of or in connection with your employment by the
Company (including, without limitation, data contained on PDAs and computers).

--------------------------------------------------------------------------------

9. You agree that you will not make any negative comments or disparaging
remarks, in writing, orally or electronically, about the Company or any other
Releasee and their respective officers, directors, shareholders, employees and
agents and their respective products and services. However, nothing in this
Agreement shall be interpreted to restrict your right and obligation to testify
truthfully.

 

10. In response to any inquiries by employees of the Company or third parties
concerning any of the terms or circumstances of your termination, you agree (i)
that you will state only that your employment with and position as a director of
the Company have terminated by mutual agreement or to state information publicly
disclosed by the Company, whether in press releases, public filings or
otherwise, or (ii) if information publicly disclosed by the Company, whether in
press releases, public filings or otherwise, concerning this Agreement is
inaccurate in any material respect, you may respond to the inquiry with accurate
corrective information so long as you have previously notified the Company of
the material inaccuracy and requested the Company to issue a corrective
disclosure and the Company has failed to issue such a corrective disclosure
within five days of your notification and request. The foregoing shall not apply
to communications with (i) your wife or (ii) legal and tax advisors to the
extent it is for the purpose of rendering professional advice.

 

11. While you are not prevented from applying for employment or reemployment
with the Company or any related or affiliated company, in the event that you
seek employment and/or reemployment, the Company or any related or affiliated
company shall have no obligation to employ you or reemploy you, and the failure
or refusal to employ you or reemploy you shall not in itself be deemed unlawful
retaliation or discrimination against you.

 

12. You will be provided at the Company’s expense with outplacement services
designed for executive level personnel for a period of six (6) months if you so
request. Thereafter, you may extend the outplacement, at the Company’s expense,
for up to two immediately subsequent three (3) month periods; provided, however,
that such outplacement shall cease on your acceptance of an offer of full-time
employment in a senior executive position.

 

13. This Agreement may be amended only in writing signed by you and me, Sr.
Human Resources Officer, of the Company.

 

14. This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Pennsylvania, without reference to conflicts of law
principles.

 

15. Nothing in this Agreement shall be construed as an admission or concession
of liability or wrongdoing by the Company or any other Releasee. Rather, the
proposed Agreement is being offered for the sole purpose of settling amicably
any and all possible disputes between the parties.

--------------------------------------------------------------------------------

16. If any provision in this Agreement or the application thereof is construed
to be overbroad, then the court making such determination shall have the
authority to narrow the provision as necessary to make it enforceable and the
provision shall then be enforceable in its narrowed form. In the event that any
provision in this Agreement is determined to be legally invalid or unenforceable
by any court of competent jurisdiction and cannot be modified to be enforceable,
the affected provision(s) shall be stricken from the Agreement, and the
remaining terms of the Agreement and its enforceability shall remain unaffected
thereby.

 

17. You agree and represent that:

 

(a) You have read carefully the terms of this Agreement, including the General
Release;

 

(b) You have had an opportunity to and have been encouraged to review this
Agreement, including the General Release, with an attorney;

 

(c) You understand the meaning and effect of the terms of this Agreement,
including the General Release;

 

(d) You were given at least 45 days to determine whether you wished to enter
into this Agreement, including the General Release;

 

(e) The entry into and execution of this Agreement, including the General
Release, is of your own free and voluntary act without compulsion of any kind;

 

(f) No promise or inducement not expressed herein has been made to you; and

 

(g) You have adequate information to make a knowing and voluntary waiver.

 

18 If you sign this Agreement, you will retain the right to revoke it for seven
(7) calendar days (“Revocation Period”). The Agreement shall not be effective
until after the Revocation Period has expired without you having revoked it. To
revoke this Agreement, you must send a letter to my attention. The letter must
be post-marked within 7 days of your execution of this Agreement. If the seventh
day is a Sunday or federal holiday, then the letter must be post-marked on the
following business day. If you revoke this Agreement on a timely basis, you
shall not be eligible for the payments and other benefits set forth in paragraph
2 above.

 

19. As noted above, you have 45 days to decide whether you wish to execute this
Agreement. If you do not sign this Agreement on or before July 4, 2005, then
this offer is withdrawn and you will not be eligible for the payments and other
benefits set forth in paragraph 2 above.

--------------------------------------------------------------------------------

20. In connection with this Agreement we are providing you with a list of the
ages and job titles of those employees whose employment is being terminated on
the Termination Date. Please see Attachment A.

 

If you agree with the proposed terms as set forth above, please sign this letter
indicating that you understand, agree with and intend to be legally bound by
such terms.

 

We wish you the best in the future.

 

Sincerely,

/s/ G. D. Isaacs

Gary Isaacs, Sr. Human Resources Officer

UNDERSTOOD AND AGREED,

INTENDING TO BE LEGALLY BOUND:

/s/ Howard E. Goldberg

Howard E. Goldberg

May 26, 2005

Date

/s/ G. D. Isaacs

Witness

--------------------------------------------------------------------------------

ATTACHMENT A

TO SEVERANCE AGREEMENT AND GENERAL RELEASE

INFORMATION MADE AVAILABLE PURSUANT TO

THE OLDER WORKER BENEFIT PROTECTION ACT OF 1990

 

The following information is provided in accordance with the Older Worker
Benefit Protection Act of 1990 to permit affected employees age forty (40) and
older to evaluate whether to execute a Severance Agreement and General Release
in return for the receipt of severance benefits.

 

1. For purposes of this Attachment, the Decisional Unit consists of the
following two (2) positions: Chief Executive Officer and Chief Operating
Officer.

 

2. Both employees in the Decisional Unit are being terminated and are eligible
for and have been selected for the applicable severance payments and other
benefits.

 

3. Both employees who are being terminated are eligible for the severance
payments and other benefits set forth in paragraph 2 of his Severance Agreement
and General Release. However, to receive the severance payments and other
benefits set forth in paragraph 2 of his Severance Agreement and General
Release, the employee must sign the Severance Agreement and General Release and
return it to Gary Isaacs, the Company’s Senior Human Resources Officer,
InterDigital Communications Corporation, 781 Third Avenue, King of Prussia, PA
19406, no later than forty-five (45) days after receiving the Severance
Agreement and General Release. Once the signed Severance Agreement and General
Release is returned to Mr. Isaacs, an employee has seven (7) days to revoke it.

 

4. The following is a listing of the ages and job titles of employees in the
Decisional Unit who were and were not selected for termination and the offer of
severance payments and other benefits as set forth in paragraph 2 of his
Severance Agreement:

 

(a) Employees who were not selected for termination so that they are not
eligible for severance payments and other benefits:

 

None

 

(b) Employees who were selected for termination and are eligible for the
severance payments and other benefits set forth in paragraph 2 of his Severance
Agreement:

 

Chief Executive Officer

  Age 59

Chief Operating Officer

  Age 51