Exhibit 10.1

LOGICVISION, INC.

CHANGE OF CONTROL SEVERANCE AGREEMENT

          This Change of Control Severance Agreement (this “Agreement”) is made
and entered into effective as of February 15, 2006 (the “Effective Date”), by
and between [NAME OF INDIVIDUAL] (the “Executive”) and LogicVision, Inc., a
Delaware corporation (the “Company”).  Certain capitalized terms used in this
Agreement are defined in Section 1 below.

RECITALS

          A.          It is expected that the Company from time to time will
consider the possibility of a Change of Control.  The Board of Directors of the
Company (the “Board”) recognizes that such consideration can be a distraction to
the Executive and can cause the Executive to consider alternative employment
opportunities.

          B.          The Board believes that it is in the best interests of the
Company and its shareholders to provide the Executive with an incentive to
continue his employment and to maximize the value of the Company upon a Change
of Control for the benefit of its shareholders.

          C.          In recognition of Executive’s service with the Company
during which time Executive’s leadership has been fundamental to the Company’s
development and in order to provide the Executive with enhanced financial
security and sufficient encouragement to remain with the Company notwithstanding
the possibility of a Change of Control, the Board believes that it is imperative
to provide the Executive with certain severance benefits upon the Executive’s
termination of employment in connection with a Change of Control.

AGREEMENT

          In consideration of the mutual covenants herein contained and the
continued employment of the Executive by the Company, the parties agree as
follows:

          1.          Definition of Terms.  The following terms referred to in
this Agreement shall have the following meanings:

                       (a)          Cause.  “Cause” shall mean (i) commission of
a felony, an act involving moral turpitude, or an act constituting common law
fraud, and which has a material adverse effect on the business or affairs of the
Company or its affiliates or stockholders; (ii) intentional or willful
misconduct or refusal to follow the lawful instructions of the Board; or (iii)
intentional breach of Company confidential information obligations which has an
adverse effect on the Company or its affiliates or stockholders.  For these
purposes, no act or failure to act shall be considered “intentional or willful”
unless it is done, or omitted to be done, in bad faith without a reasonable
belief that the action or omission is in the best interests of the Company.

                       (b)          Change of Control.  “Change of Control”
shall mean the occurrence of any of the following events:

                                      (i)          the approval by the
shareholders of the Company of a plan of complete liquidation or dissolution of
the Company or the closing of a sale or disposition by the Company of all or
substantially all of the Company’s assets, other than a sale or disposition to a
subsidiary of the Company or to an entity, the voting securities of which are
owned by the stockholders of the Company in substantially the same proportions
as their ownership of the Company’s voting securities immediately prior to such
sale or disposition;

                                      (ii)          a merger or consolidation of
the Company with any other corporation, other than a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent directly or indirectly (either
by remaining outstanding or by being converted into voting securities of the
surviving entity) more than fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or

                                      (iii)          any “person” (as such term
is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended) becoming the “beneficial owner” (as defined in Rule 13d-3 under said
Act), directly or indirectly, of securities of the Company representing fifty
percent (50%) or more of the total voting power represented by the Company’s
then outstanding voting securities.

          Notwithstanding the foregoing, the term “Change of Control” shall not
be deemed to have occurred if the Company files for bankruptcy protection, or if
a petition for involuntary relief is filed against the Company.

                       (c)          Involuntary Termination.  “Involuntary
Termination” shall mean:

                                      (i)          without the Executive’s
express written consent, a material reduction in the Executive’s title,
authority, duties, position or responsibilities relative to the Executive’s
title, authority, duties, position or responsibilities in effect immediately
prior to the Change of Control provided that no such material reduction shall be
deemed to occur solely by reason of the Company becoming a subsidiary or
division of an acquiring entity;

                                      (ii)          without the Executive’s
express written consent, a reduction by the Company of the Executive’s base
salary or target bonus as in effect immediately prior to the Change of Control;

                                      (iii)          without the Executive’s
express written consent, the relocation of the Executive’s principal place of
employment to a facility or a location more than fifty (50) miles from his
current location;

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                                      (iv)          any termination of the
Executive by the Company which is not effected for Cause; or

                                      (v)          the failure of the Company to
obtain the assumption of this Agreement or any other agreement between the
Company and Executive by any successors contemplated in Section 7 below.

                       (d)          Termination Date.  “Termination Date” shall
mean the effective date of any notice of termination delivered by one party to
the other hereunder.

          2.          Term of Agreement.  This Agreement shall terminate upon
the date that all obligations of the parties hereto under this Agreement have
been satisfied.

          3.          At-Will Employment.  The Company and the Executive
acknowledge that the Executive’s employment is and shall continue to be at-will,
as defined under applicable law.

          4.          Severance Benefits.

                       (a)          Involuntary Termination in Connection with a
Change of Control.  Subject to Section 4(b), if the Executive’s employment with
the Company terminates as a result of an Involuntary Termination on or at any
time within three (3) months before or twelve months (12) months after a Change
of Control, and the Executive signs and does not revoke a standard release of
claims with the Company in a form acceptable to the Company, then the Executive
shall be entitled to the following severance benefits (it being understood that
no such benefits shall accrue and be payable (or take effect, as the case may
be) unless and until a Change in Control occurs):

                                      (i)          150% of the Executive’s
annual base salary as in effect as of the Termination Date, less applicable
withholding, payable in a lump sum within thirty (30) days of the Involuntary
Termination or, if later, the Change in Control;

                                      (ii)          150% of the Executive’s
target bonus plus target commission for the fiscal year in which the Termination
Date occurs, less applicable withholding, payable in a lump sum within thirty
(30) days of the Involuntary Termination or, if later, the Change in Control;

                                      (iii)          acceleration of the vesting
and exercisability of all of the Executive’s options to acquire common stock of
the Company or its successor, or the parent of either, to the extent
outstanding, or of any deferred compensation into which the Executive’s stock
options were converted upon the Change of Control; and

                                      (iv)          reimbursement by the Company
of the group health continuation coverage premiums for the Executive and the
Executive’s eligible dependents under Title X of the Consolidated Budget
Reconciliation Act of 1985, as amended (“COBRA”) as in effect through the lesser
of (x) twelve (12) months from the date of such termination, (y) the date upon
which the Executive and the Executive’s eligible dependents become covered under
similar plans or (z) the date the Executive no longer constitutes a “Qualified
Beneficiary” (as such term is

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defined in Section 4980B(g) of the Code); provided, however, that the Executive
will be solely responsible for electing such coverage within the required time
period; and provided further,  however, that payment of the reimbursement shall
not be made prior to the Change in Control.

                       (b)          Limitation on Benefits Following Certain
Changes of Control.  If (i) with respect a Change of Control described in
Section 1(c)(i) involving a plan of liquidation or dissolution of the Company,
the amount (as projected in good faith by the Company’s Board of Directors) to
be distributed in respect of one share of the Company’s common stock (“Common
Stock”) is less than the closing price per share of the Common Stock on the
Nasdaq National Market on the date of this Agreement, (ii) with respect to a
Change in Control described in Section 1(c)(i) involving the sale of all or
substantially all of the Company’s assets, the aggregate consideration to be
received by the Company in such sale is less than the aggregate market value of
the fully diluted outstanding Common Stock as of the date of this Agreement
(based on the closing price per share of the Common Stock on the Nasdaq National
Market on the date of this Agreement and using the treasury stock method), or
(iii) with respect to a Change in Control described in Section 1(c)(ii), the
consideration per share of Common Stock is less than the closing price per share
of the Common Stock on the Nasdaq National Market on the date of this Agreement,
then the percentages set forth in subsections 4(a)(i) and (ii) shall be 50%
rather than 150% and the number of months after the date of termination set
forth in Section 9 shall be six (6) rather than eighteen (18).  In valuing
consideration per share and aggregate consideration, (x) the value of any
securities delivered as consideration, for which there are quotations available
in the public markets, shall be the closing market price on the last trading day
prior to the closing of the Transaction, (y) the value of securities or other
non-cash consideration for which there are not quotations available in the
public markets shall be the fair market value thereof as determined in good
faith by the Company’s Board of Directors upon such closing, and (z) the value
of any contingent future payment obligations, such as earn-outs, shall be the
expected present value of such obligations, as determined in good faith by the
Company’s Board of Directors.

                       (c)          Termination Apart from a Change of Control. 
If the Executive’s employment with the Company terminates other than as a result
of an Involuntary Termination on or within three (3) months before or twelve
(12) months after a Change of Control then the Executive shall not be entitled
to receive severance or other benefits hereunder.

                       (d)          Accrued Wages and Vacation; Expenses. 
Without regard to the reason for, or the timing of, the Executive’s termination
of employment: (i) the Company shall pay the Executive any unpaid wages due for
periods prior to the Termination Date; (ii) the Company shall pay the Executive
all of the Executive’s accrued and unused vacation through the Termination Date;
and (iii) following submission of proper expense reports by the Executive, the
Company shall reimburse the Executive for all expenses reasonably and
necessarily incurred by the Executive in connection with the business of the
Company prior to the Termination Date.  These payments shall be made promptly
upon termination and within the period of time mandated by law.

          5.          Limitation on Payments.  In the event that the severance
and other benefits provided for in this Agreement or otherwise payable to the
Executive (i) constitute “parachute

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payments” within the meaning of Section 280G of the Code and (ii) would be
subject to the excise tax imposed by Section 4999 of the Code (the “Excise
Tax”), then the Executive’s benefits under this Agreement shall be either:

                       (a)          delivered in full or

                       (b)          delivered as to such lesser extent which
would result in no portion of such benefits being subject to the Excise Tax,

whichever of the foregoing amounts, taking into account the applicable federal,
state and local income taxes and the Excise Tax, results in the receipt by the
Executive on an after-tax basis, of the greatest amount of benefits,
notwithstanding that all or some portion of such benefits may be taxable under
Section 4999 of the Code.

          Unless the Company and the Executive otherwise agree in writing, any
determination required under this Section 5 shall be made in writing by the
Company’s independent public accountants (the “Accountants”), whose
determination shall be conclusive and binding upon the Executive and the Company
for all purposes.  For purposes of making the calculations required by this
Section 5, the Accountants may make reasonable assumptions and approximations
concerning applicable taxes and may rely on reasonable, good faith
interpretations concerning the application of Sections 280G and 4999 of the
Code.  The Company and the Executive shall furnish to the Accountants such
information and documents as the Accountants may reasonably request in order to
make a determination under this Section 5.  The Company shall bear all costs the
Accountants may reasonably incur in connection with any calculations
contemplated by this Section 5.

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          6.          Delayed Commencement of Benefits.  Notwithstanding any
provision to the contrary in this Agreement, no cash severance and no
Company-paid health care coverage to which the Executive otherwise becomes
entitled under this Agreement shall be made or provided to the Executive prior
to the earlier of (i) the expiration of the six (6)-month period measured from
the date of the Executive’s “separation from service” with the Company (as such
term is defined in Treasury Regulations issued under Code Section 409A) or (ii)
the date of the Executive’s death, if the Executive is deemed at the time of
such separation from service to be a “key employee” within the meaning of that
term under Code Section 416(i) and such delayed commencement is otherwise
required in order to avoid a prohibited distribution under Code Section
409A(a)(2).  Upon the expiration of the applicable Code Section 409A(a)(2)
deferral period, all payments and benefits deferred pursuant to this Section 6
(whether they would have otherwise been payable in a single sum or in
installments in the absence of such deferral) shall be paid or reimbursed to the
Executive in a lump sum, and any remaining payments and benefits due under this
Agreement shall be paid or provided in accordance with the normal  payment dates
specified for them herein.  The Executive shall be entitled to interest on the
deferred benefits and payments for the period the commencement of those benefits
and payments is delayed by reason of Code Section 409A(a)(2), with such interest
to accrue at the prime rate in effect from time to time during that period and
to be paid in a lump sum upon the expiration of the deferral period.

          7.          Successors.

                       (a)          Company’s Successors.  Any successor to the
Company (whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company’s business and/or assets shall assume the Company’s obligations under
this Agreement and agree expressly to perform the Company’s obligations under
this Agreement in the same manner and to the same extent as the Company would be
required to perform such obligations in the absence of a succession.  For all
purposes under this Agreement, the term “Company” shall include any successor to
the Company’s business and/or assets which executes and delivers the assumption
agreement described in this subsection (a) or which becomes bound by the terms
of this Agreement by operation of law.

                       (b)          Executive’s Successors.  Without the written
consent of the Company, the Executive shall not assign or transfer this
Agreement or any right or obligation under this Agreement to any other person or
entity.  Notwithstanding the foregoing, the terms of this Agreement and all
rights of the Executive hereunder shall inure to the benefit of, and be
enforceable by, the Executive’s personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.

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          8.          Notices.

                       (a)          General.  Notices and all other
communications contemplated by this Agreement shall be in writing and shall be
deemed to have been duly given when personally delivered or when mailed by U.S. 
registered or certified mail, return receipt requested and postage prepaid.  In
the case of the Executive, mailed notices shall be addressed to him at the home
address which he most recently communicated to the Company in writing.  In the
case of the Company, mailed notices shall be addressed to its corporate
headquarters, and all notices shall be directed to the attention of its
Secretary.

                       (b)          Notice of Termination.  Any termination by
the Company for Cause or by the Executive as a result of an Involuntary
Termination shall be communicated by a notice of termination to the other party
hereto given in accordance with this Section 8.  Such notice shall indicate the
specific termination provision in this Agreement relied upon, shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination under the provision so indicated, and shall specify the Termination
Date (which shall be not more than thirty (30) days after the giving of such
notice).  The failure by the Executive to include in the notice any fact or
circumstance which contributes to a showing of Involuntary Termination shall not
waive any right of the Executive hereunder or preclude the Executive from
asserting such fact or circumstance in enforcing his rights hereunder.

          9.          Non-Solicitation and Non-Competition.

                       (a)          Non-Solicitation.  Subject to Section 4(b),
until the date that is eighteen (18) months from the date of termination of the
Executive’s employment with the Company, the Executive agrees and acknowledges
that the Executive shall not either directly or indirectly solicit, induce,
attempt to hire, recruit, encourage, take away, hire any employee of the Company
or cause an employee to leave his or her employment either for the Executive or
for any other entity or person.  Upon any breach of this Section 9, all
severance payments pursuant to this Agreement shall immediately cease.

                       (b)          Non-Competition.  Until the date Executive
ceases to provide services to the Company (or any parent or subsidiary of the
Company) or, if later, the date through which severance is payable pursuant to
Section 4, Executive agrees to not, directly or indirectly, engage in (whether
as an employee, consultant, agent, proprietor, principal, partner, stockholder,
corporate officer, director or otherwise), nor have any ownership interest in or
participate in the financing, operation, management or control of, any person,
firm, corporation or business that competes with Company (or any parent or
subsidiary of the Company); provided, however, that Executive shall not be
prohibited from owning, solely as an investment, up to 1% of the stock of a
publicly traded corporation or up to 5% of the equity of a non-publicly traded
company.

          10.          Arbitration.

                         Any controversy involving the construction or
application of any terms, covenants or conditions of this Agreement, or any
claims arising out of any alleged breach of this Agreement, will be governed by
the rules of the American Arbitration Association and submitted

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to and settled by final and binding arbitration in Santa Clara County,
California, except that any alleged breach of the Executive’s confidential
information obligations shall not be submitted to arbitration and instead the
Company may seek all legal and equitable remedies, including without limitation,
injunctive relief.

          11.         Miscellaneous Provisions.

                        (a)          No Duty to Mitigate.  The Executive shall
not be required to mitigate the amount of any payment contemplated by this
Agreement, nor shall any such payment be reduced by any earnings that the
Executive may receive from any other source.

                        (b)          Waiver.  No provision of this Agreement may
be modified, waived or discharged unless the modification, waiver or discharge
is agreed to in writing and signed by the Executive and by an authorized officer
of the Company (other than the Executive).  No waiver by either party of any
breach of, or of compliance with, any condition or provision of this Agreement
by the other party shall be considered a waiver of any other condition or
provision or of the same condition or provision at another time.

                        (c)          Integration.  This Agreement represents the
entire agreement and understanding between the parties with respect to the
payment of severance or other benefits if the Executive’s employment with the
Company terminates as a result of an Involuntary Termination within twelve (12)
months following a Change of Control, and supersedes all prior or
contemporaneous agreements, whether written or oral, with respect thereto;
provided, however, that this Agreement does not supersede any agreement in
respect of the payment of severance or other benefits in circumstances pursuant
to which benefits would not be payable hereunder.

                        (d)          Choice of Law.  The validity,
interpretation, construction and performance of this Agreement shall be governed
by the internal substantive laws, but not the conflicts of law rules, of the
State of California.

                        (e)          Severability.  The invalidity or
unenforceability of any provision or provisions of this Agreement shall not
affect the validity or enforceability of any other provision hereof, which shall
remain in full force and effect.

                        (f)          Employment Taxes.  All payments made
pursuant to this Agreement shall be subject to withholding of applicable income
and employment taxes.

                        (g)          Counterparts.  This Agreement may be
executed in counterparts, each of which shall be deemed an original, but all of
which together will constitute one and the same instrument.

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          IN WITNESS WHEREOF, each of the parties has executed this Agreement,
in the case of the Company by its duly authorized officer, as of the day and
year first above written.

COMPANY:

 LOGICVISION, INC.

 

 

 

 

 

 

 

By:

 

 

 

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Title:

 

 

 

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EXECUTIVE:

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 Signature

 

 

 

 

 

 

 

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Printed Name

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