**EXHIBIT 10.1**
**EMPLOYMENT AGREEMENT**
     EMPLOYMENT AGREEMENT (the “Agreement”) dated as of March 23, 2004 betweenOPENTV CORP., a corporation organized under the laws of the British VirginIslands (the “Company”), and James Chiddix (“Executive”).
     This Agreement sets forth the terms and conditions of the employment bythe Company of Executive.
     In consideration of the mutual covenants and agreements herein containedand for other good and valuable consideration, the receipt and sufficiency ofwhich is hereby acknowledged, the parties, intending to be legally bound, dohereby agree as follows:
     1. Term and Place of Employment.
          (a) The term of Executive’s employment under this Agreement (the“Employment Term”) shall initially commence on April 1, 2004 (the “EffectiveDate”) and end on the first anniversary thereof and, unless and untilExecutive’s employment is terminated as provided herein, shall be extendeddaily so that the remainder of the Employment Term shall at all times on andprior to the effective date of such termination be the one (1) year anniversaryof the date from which it has been extended pursuant to this provision. Duringthe Employment Term, the Company agrees to employ Executive, and Executiveagrees to serve the Company, upon and subject to the terms and conditions setforth in this Agreement.
          (b) Unless otherwise agreed in writing by Executive, Executive’s principalplace of work, subject to reasonable and customary travel, shall be theCompany’s principal executive offices located in, San Francisco, California.
     2. Title and Duties; Power and Authority.
          (a) Subject to the provisions of this Agreement, the Company and Executiveagree that, during the Employment Term, Executive shall serve the Company asthe Executive Chairman of the Board of Directors of the Company (the “Board”),and in such other positions as may be agreed upon from time to time byExecutive and the Board. Executive shall have the rights, powers, duties andobligations relating to such office(s) as are customarily associated with suchoffice(s) and such other rights, powers, duties and obligations as may beagreed upon from time to time by Executive and the Board.
          (b) The Company and Executive acknowledge and agree that Executive shallreport directly to the Board. The Chief Executive Officer of the Company shallreport directly to the Executive.
          (c) Executive agrees to devote his full business time and efforts to theCompany. Nothing herein shall prevent Executive from (i) participating inindustry, trade, professional, charitable and community activities, (ii)serving on corporate, civic or charitable boards or committees, and (iii)managing his personal investments and affairs, in each case so
 

 

long as such activities do not conflict with the Company’s interests orinterfere with the performance of Executive’s responsibilities to the Companyin accordance with this Agreement. Upon any termination of Executive’semployment with the Company, Executive shall resign from any positions he mayhold at the time on the Board or on the board of directors of any other companyon which he serves at the request of the Company.
     3. Compensation; Benefits; Stock Options.
          (a) Salary. During the Employment Term, the Company shall pay toExecutive a salary at the rate of $450,000 per annum (as increased from time totime pursuant to the terms hereof, “Salary”), with a non-negative annualadjustment based on the Consumer Price Index for all urban Consumers, U.S. CityAverage, for all items as published by the Bureau of Labor Statistics of theDepartment of Labor with the first adjustment on the first anniversary of theEffective Date, and subsequent adjustments on subsequent anniversaries of theEffective Date. Executive’s Salary shall be paid to Executive in regularintervals in accordance with the Company’s customary payroll schedules forsalaried employees, but in no event less frequently than twice each month. Inaddition to any annual adjustment provided for in the first sentence of thisparagraph, Executive’s Salary may be reviewed annually and increased, at anytime, in the sole discretion of the Board.
          (b) Annual Bonus. In addition to Salary, Executive shall be entitled toreceive an annual bonus (the “Annual Bonus”) as follows:
               (i) for the year ending December 31, 2004, an amount equal to thirty-threepercent (33%) of the Salary, prorated for the actual weeks during such yearthat Executive was employed by the Company (the “First Year Bonus”), payable incash, or, as provided below, by issuance to Executive of an equivalent numberof freely tradable (subject to Company policies regarding trading by insiders)Class A Ordinary Shares, no par value (the “Class A Ordinary Shares”), of theCompany. The First Year Bonus shall be payable or issuable, as applicable, inarrears in three installments within five business days after the end of thecalendar quarter for which the First Year Bonus was earned, commencing with thequarter ending June 30, 2004, and, thereafter, the quarters ending September30, 2004 and December 31, 2004; provided, that if Executive commencesemployment prior to March 31, 2004, then, in such event, the bonus accrual inrespect of the period from the Effective Date through March 31, 2004 shall bepaid together with the installment otherwise payable on June 30, 2004 and,provided, further, that, no bonus payment shall be due unless Executive isemployed with the Company on the last day of the calendar quarter to whichsuch payment relates. Executive may make an irrevocable election to receivepayment of all or any portion of the First Year Bonus in the form of Class AOrdinary Shares issued pursuant to the Company’s Stock Incentive Plan (the“Incentive Plan”) and valued at the Fair Market Value (as defined below) of theClass A Ordinary Shares on the last day of the calendar quarter for which theportion of the First Year Bonus was earned, with any fractional shares paid incash. Any election by Executive to receive all or any portion of the FirstYear Bonus in Class A Ordinary Shares must be made no later thanthe 30thcalendar day prior to the end of the calendar quarter to which the electionapplies by written notice to the Secretary of the Company, and the Company’sobligation to issue such shares shall be conditioned upon the shares beingregistered under the Securities Act of 1933 on an effective RegistrationStatement on Form S-8 or other appropriate form.
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          “Fair Market Value” of a Class A Ordinary Share on any day means the lastsale price (or, if no last sale price is reported, the average of the high bidand low asked prices) for a Class A Ordinary Share on such day (or, if such dayis not a trading day, on the next preceding trading day) as reported on TheNasdaq National Market (“Nasdaq”), or, if not reported on Nasdaq, as quoted bythe National Quotation Bureau Incorporated, or if Class A Ordinary Shares arelisted on an exchange, on the principal exchange on which the Class A OrdinaryShares are listed. If for any day the Fair Market Value of a Class A OrdinaryShare is not determinable by any of the foregoing means (or if the CompensationCommittee of the Board (the “Committee”) determines for any purpose that theFair Market Value of a Class A Ordinary Share should be determined on anintra-day basis), then the Fair Market Value for such day (or at a given timeon such day) shall be determined in good faith by the Committee on the basis ofsuch quotations and other considerations as the Committee deems appropriate.
               (ii) for each of the calendar years in the Employment Term following theyear ended December 31, 2004, Executive shall be eligible for annualdiscretionary bonus awards (the target amount of which shall be established bythe Committee prior to the commencement of any calendar year to which itrelates), based on financial and strategic objectives agreed to annually by theCommittee and Executive, such discretionary bonus, if any, to be paid toExecutive in a lump sum cash payment or, at the option of the Committee, ClassA Ordinary Shares issued pursuant to the Incentive Plan and valued at the FairMarket Value of a Class A Ordinary Share on the day immediately preceding thedate such bonus is determined by the Committee, with any fractional shares paidin cash. Such annual discretionary bonus awards shall be payable or issuable,as applicable, as soon as practicable after the Committee can determinewhether, and the degree to which, such financial and strategic objectives havebeen reached, but in no event later than any discretionary performance bonusespaid to other senior executives of the Company.
          (c) Benefits. During the Employment Term, the Company shall provideExecutive with the right to participate in and to receive benefits from allpresent and future life, accident, disability, medical, pension and savingsplans and all similar benefits made available generally to executives of theCompany. The amount and extent of benefits to which Executive is entitledshall be governed by the specific benefit plan, as it may be amended from timeto time.
          (d) Vacation. During the Employment Term, Executive shall be entitled tofour weeks of paid vacation per year or such longer period as may be providedby the Company in accordance with the most favorable plans, policies, programsand practices of the Company. Such vacation shall be taken at such times andintervals as shall be determined by Executive, subject to the reasonablebusiness needs of the Company. Executive shall not be entitled to defer morethan two weeks’ vacation time not taken to a later calendar year. In the eventof any termination of this Agreement, Executive shall be entitled to cashcompensation for vacation time not used as of the date of termination to theextent that such vacation time has been accrued during the calendar year oftermination (“Final Vacation Pay”).
          (e) Equity Compensation.
               *(i) Initial Stock Option Grant*. On the Effective Date, the Company willgrant to the Executive a nonqualified stock option under the Incentive Plan topurchase one
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million (1,000,000) Class A Ordinary Shares (the “Initial Option”), withan exercise price equal to the Fair Market Value of the Class A Ordinary Shareson the last trading day immediately preceding the first public announcement bythe Company of Executive’s employment with the Company (the “AnnouncementDate”). The Initial Option shall vest in equal annual installments on each ofthe second, third, fourth and fifth anniversaries of the Effective Date andshall be evidenced by a standard stock option agreement approved by theCommittee for the grant of other stock options under the Incentive Plan, a copyof which is attached hereto as Exhibit A and by this reference incorporatedherein (the “Option Agreement”); provided, that to the extent there are anyinconsistencies between the terms of this Agreement and the terms of such formof stock option agreement, the terms of this Agreement shall govern, and, tothe extent necessary, the form of option agreement entered into by Executiveand the Company will be revised to make it consistent herewith.
               *(ii) Performance Based Options*. On the Effective Date, the Company willgrant to the Executive non-qualified stock options to purchase an aggregate offive hundred thousand (500,000) Class A Ordinary Shares (the “Performance BasedOptions”) at an exercise price equal to the Fair Market Value of a Class AOrdinary Share on the last trading day immediately preceding the AnnouncementDate. The Performance Based Options shall have the terms and conditions setforth in Exhibit B attached hereto, which is hereby incorporated by referenceas if set forth herein, and shall be evidenced by an Option Agreement;provided, that to the extent there are any inconsistencies between the terms ofthis Agreement and the terms of such form of Option Agreement, the terms ofthis Agreement shall govern, and, to the extent necessary, the form of optionagreement entered into by Executive and the Company will be revised to make itconsistent herewith.
     4. Reimbursement of Business and Other Expenses; Perquisites.
          (a) Expense Reimbursement. The Company shall pay or reimburse Executivepromptly for all reasonable expenses and other disbursements incurred or paidby Executive in the performance of his duties and responsibilities under thisAgreement, including those incurred or paid in connection with business relatedtravel, telecommunications and entertainment, subject to reasonablesubstantiation by Executive in accordance with the Company’s policies.
          (b) Office and Support Staff. During the Employment Term, Executive shallbe entitled to an office or offices of a size and with furnishings and otherappointments, and to his choice of secretary and secretarial arrangement, andother assistance to the extent needed to fulfill his corporateresponsibilities, in San Francisco, California, all of which shall be at leastequal to the most favorable of the foregoing provided to any other executiveofficer by the Company at any time during the Employment Term.
          (c) Relocation Expenses. The Company will reimburse Executive, on anafter-tax basis, for the following expenses: (i) reasonable moving expensesincurred by Executive and Executive’s family during Executive’s relocation fromhis primary residence to the San Francisco area, (ii) reasonable costs incurredduring the relocation of Executive and Executive’s family to the San Franciscoarea, including reasonable costs associated with the sale of Executive’scurrent primary residence and purchase of Executive’s primary residence in theSan Francisco area (*e.g.*, reasonable brokerage costs, etc.), and (iii)reasonable costs (including,
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but not limited to, origination fees and interest) incurred by Executivein connection with his obtaining a bridge loan (which loan shall not exceed$1,250,000 and shall have a term of no more than six months) to facilitate thesale of his current primary residence and the purchase of a new primaryresidence in the San Francisco area. Subject to the foregoing, Executive shallbe reimbursed up to a maximum of $60,000 in respect of rent or lease paymentsincurred in connection with a temporary residence in the San Francisco area.
     5. Termination. Notwithstanding the provisions of Section 2 hereof,Executive’s employment hereunder shall terminate prior to the expiration of theEmployment Term under the following circumstances:
               (a) Death. If Executive dies while employed by the Company and prior tothe expiration of the Employment Term, Executive’s employment hereunder shallimmediately terminate.
               (b) Disability. The Company may terminate Executive’s employment, uponten (10) business days prior written notice to Executive, in the event of anillness, injury, accident or condition of either a physical or psychologicalnature, which prevents Executive from performing his essential duties hereunderas determined in good faith by the Board and there is no reasonableaccommodation that can be provided by the Company that would allow Executive toperform such essential duties as determined under applicable law, for a periodof not less than one hundred twenty (120) working days (whether or notconsecutive) during the twelve calendar months preceding the month in whichsuch notice is given (a “Disability”).
               (c) By the Company For Cause. The Company may terminate Executive’semployment during the Employment Term for Cause at any time upon written noticeof such termination to Executive setting forth in reasonable detail the natureof such Cause.
               For purposes of this Agreement, “Cause” shall be deemed to have occurredon the happening of any of the following: (i) the Executive’s conviction of,or a plea of “guilty” or “no contest” to a felony under the laws of the UnitedStates or any state thereof (other than a traffic violation); provided,however, that after indictment, the Company may suspend Executive from therendition of services, but without limiting or modifying in any other way theCompany’s obligations under this Agreement; (ii) the Executive’s fraud, theft,embezzlement, other material dishonesty or any material breach by Executive ofa fiduciary duty owed to the Company that is injurious to the reputationCompany; (iii) Executive’s willful failure to perform (other than by reason ofa Disability), or gross neglect in the performance of, his duties andresponsibilities to the Company, (iv) material breach by Executive of Section 7or 8 hereof, or (v) Executive’s agreement to settle any charge brought againsthim by the Securities and Exchange Commission with respect to any act oromission by Executive, which charge involves an allegation of fraud or, in thegood faith opinion of the Board, would have reasonably likely resulted in aconviction had the matter proceeded; provided, however, that the Company mayterminate Executive for “Cause” within the meaning of clause (iii) or (iv)above only upon 20 days prior written notice to Executive during which periodExecutive may cure the breach or neglect, if curable.
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               (d) By the Company Other Than For Cause. The Company may terminateExecutive’s employment during the Employment Term other than for Cause at anytime upon giving not less than 20 days’ prior written notice of suchtermination to Executive.
               (e) By Executive.
                    (i) Executive may terminate his employment during the Employment Term atany time upon giving written notice of such termination to the Board not lessthan 60 days prior to the effective date of termination (which shall be the60th day after the giving of such written notice, or earlier if the Company’sdesignated successor to Executive commences employment with the Company priorto the end of such 60-day period).
                    (ii) Executive may terminate his employment, at any time, hereunder forGood Reason, as defined below, upon 20 days’ prior written notice of suchtermination to the Board setting forth in reasonable detail the basis of suchGood Reason.
                    For purposes of this Agreement, “Good Reason” shall be deemed to haveoccurred on the happening of any of the following: (i) a material reduction ofExecutive’s Salary; (ii) a change in the Executive’s title or position; or(iii) a change in the Executive’s principal place of business to a locationmore than 50 miles from the city of San Francisco.
     6. Obligations of the Company upon Termination.
          (a) Termination due to Death or Disability. If, during the EmploymentTerm, Executive’s employment is terminated in accordance with Section 5(a) or5(b) hereof, the Company shall pay or provide to or in respect of Executive,within 10 days after the date of termination, the following amounts andbenefits:
               (i) a lump sum in an amount equal to the sum of (a) Executive’s Salarythrough the date of termination, (b) Final Vacation Pay, calculated based uponExecutive’s Salary at the date of termination, and (c) business expensesreimbursable under Section 4(a), in each case to the extent not theretoforepaid (the sum of the amounts described in clauses (a), (b) and (c) shall behereinafter referred to as the “Accrued Obligation”);
               (ii) a lump sum in cash in an amount equal to the Salary that would havebeen payable to Executive pursuant to this Agreement for the period beginningon the date of termination and ending on the 180th day thereafter (such Salaryto be calculated at the annual rate of Executive’s Salary in effect on the dateof termination);
               (iii) as soon as practical following the fiscal year in which the death orDisability occurs, payment of an amount equal to the product of (x) the AnnualBonus (based on the target established prior to the commencement of therelevant year to which it applies) that would have been paid to Executive withrespect to the year in which Executive’s employment was terminated by reason ofdeath or Disability, and (y) a fraction, the numerator of which is the numberof days in the fiscal year through the date of termination and the denominatorof which is 365;
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               (iv) immediate vesting of all stock options granted pursuant to Section3(e) in accordance with the Incentive Plan, except for any Performance BasedOptions, which had not commenced vesting prior to the date of termination; and
               (v) all vested stock options held by Executive following the terminationof Executive’s employment by reason of death or Disability shall remainexercisable for a period of one year following the date of termination (but notlater than the scheduled expiration of such stock option) in accordance withthe Incentive Plan.
          (b) Termination by the Company for Cause. If, during the Employment Term,Executive’s employment is terminated in accordance with Section 5(c), (i) theCompany shall pay to Executive in a lump sum in cash on the date of terminationthe Accrued Obligation, and (ii) all stock options granted pursuant to Section3(e), notwithstanding any prior vesting, shall immediately terminate.
          (c) Termination by the Company Other than for Cause or By Executive forGood Reason. If, during the Employment Term, Executive’s employment isterminated in accordance with Section 5(d) by the Company or in accordance withSection 5(e)(ii) by the Executive, the Company shall pay or provide toExecutive, the following amounts and benefits:
               (i) the Accrued Obligation;
               (ii) Salary continuation, payable in accordance with the normal payrollpractices of the Company in effect on the date of termination, for theremainder of the Employment Term, unless the date of such termination is within12 months following the date of any “Approved Transaction”, “Board Change” or“Control Purchase” (as such terms are defined in the Incentive Plan, andcollectively referred to herein as “Change in Control”), in which case theamount due to Executive pursuant to this Section 6(c)(ii) shall be equal to 18months of Salary, payable, in Executive’s discretion, in either a lump sumwithin 15 days following the date of termination or by the continuation ofSalary payments for the duration of such 18 month period (such Salary or lumpsum payment to be calculated at the annual rate of Executive’s Salary in effecton the date of termination);
               (iii) as soon as practical following the fiscal year in which thetermination of employment occurs, payment of an amount equal to the product of(x) the Annual Bonus (based on the target established prior to the commencementof the relevant year to which it applies) that would have been paid toExecutive with respect to the year in which Executive’s employment wasterminated without Cause, and (y) a fraction, the numerator of which is thenumber of days in the fiscal year through the date of termination and thedenominator of which is 365;
               (iv) continued vesting of the Initial Option and any Performance BasedOptions granted pursuant to Section 3(e) that had begun to vest prior to thetermination date for a period of one year from the date of termination;provided, however, that if a termination to which this Section 6(c) appliesoccurs within 12 months after a Change in Control (and the vesting of suchoptions have not otherwise been accelerated pursuant to the terms of theIncentive Plan), then, in such event, vesting of the Initial Option and anyPerformance Based Options granted
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pursuant to Section 3(e) that had begun to vest prior to such terminationshall continue for a period of 18 months from the date of termination; and
               (v) for the period during which Executive receives Salary pursuant toSection 6(c)(ii) or until such earlier time as Executive receives alternativehealth coverage, reimbursement of the difference between (A) monthly COBRApayments actually made by Executive for continued health benefits during suchperiod, and (B) the amount Executive would have paid for health coverage forhimself and his dependents under the Company’s plan had he remained an employeeof the Company during such period.
               (vi) all vested stock options held by Executive following the terminationof Executive’s employment with the Company pursuant to Section 5(d) or 5(e)(ii)(including any stock options that vest following the date of terminationpursuant to clause (iv) above) shall remain exercisable for a period of 90 daysfollowing the date on which the last options vest in accordance with thecontinued vesting provisions of Section 6(c)(iv) (but not later than thescheduled expiration of such stock option).
          (d) Termination by Executive without Good Reason. If, during theEmployment Term, Executive’s employment is terminated in accordance withSection 5(e)(i):
               (i) the Company shall pay to Executive, within 10 days after the date oftermination, a lump sum payment in an amount equal to the Accrued Obligation;
               (ii) all unvested stock options granted pursuant to Section 3(e) shallterminate on the date of termination; and
               (iii) all vested stock options held by Executive following the terminationof Executive’s employment with the Company pursuant to Section 5(e) shallremain exercisable for a period of 90 days following the date of termination(but not later than the scheduled expiration of such stock option).
          (e) Survival. Upon termination of Executive’s employment and payment ofthe amounts due Executive pursuant to Sections 5 and 6 of this Agreement, theobligations of the Company and Executive under this Agreement shall terminate,except that the Company’s obligations hereunder with respect to the paymentsand continuation of benefits set forth in this Section 6, and Executive’sobligations under Section 7 (Non-Competition; Non-Solicitation), Section 8(Confidentiality) and Section 9 (Delivery of Materials), will survive (inaccordance with the terms and conditions thereof) any such termination.
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     7. Non-Competition; Non-Solicitation.
          (a) During the Employment Term and for a period of 12 months following thetermination of Executive’s employment with the Company (the “RestrictedPeriod”), Executive shall not, except as permitted by the Company upon itsprior written consent, (i) enter, directly or indirectly, into the employ of orrender or engage in, directly or indirectly, any services to any person, firm,corporation or other entity that is in competition (or is actively planning toengage in competition) with the Company with respect to (x) any businessactively conducted by the Company on the date of Executive’s termination or (y)any business which, on the date of Executive’s termination, the Company plansto enter pursuant to a business strategy in the development of which Executiveactively participated and which was adopted by the Board before the Executive’stermination of employment (any of the foregoing being referred to herein as a“Competitive Business”), or (ii) become interested, directly or indirectly, inany such person, firm, corporation or other entity as an individual, partner,member, shareholder, creditor, director, officer, principal, agent, employee,trustee, consultant, advisor or in any other relationship or capacity. Theownership of three percent (3%) of any class of the outstanding securities ofany corporation, even though such corporation may conduct (or be planning toconduct) a Competitive Business, shall not be deemed as constituting aninterest which violates clause (ii) of the immediately preceding sentence.Further, the Executive shall not be deemed to have violated the first sentenceof this Section 7(a) solely by reason of the fact that the Executive isemployed by, or rendering services to, a person, firm, corporation or otherentity which conducts or provides services to (or may be planning to conduct orprovide services to) a Competitive Business, so long as the Executive’semployment is, or his services rendered are, solely in connection withbusinesses of such person, firm, corporation or other entity which are notCompetitive. Notwithstanding the foregoing, the provisions of this Section7(a) shall not apply to Executive if Executive’s employment is terminated bythe Company without Cause, unless the Company shall be making Salarycontinuation payments to Executive under the terms of this Agreement, in whichevent such provisions shall remain effective and apply to Executive.
          (b) During the Restricted Period, Executive shall not, directly orindirectly, whether for his own account or for the account of any otherindividual, partnership, firm, corporation or other business organization(other than the Company), (i) solicit, hire or engage in any capacity,encourage to terminate, endeavor to entice away from the Company, or otherwiseinterfere with the relationship of any individual who is employed by, orotherwise engaged to perform services for, the Company or (ii) solicit, hire orengage in any capacity or encourage any person or entity who is, or was withinthe then most recent twelve-month period, a customer of the Company or theentity which has a business relationship with the Company to terminate orreduce its relationship with the Company.
          (c) If any court determines that any provision of this Section 7 isinvalid or unenforceable, the remainder of this Section 7 shall not thereby beaffected and shall be given full effect, without regard to the invalid portion.In addition, if any court or arbitrator construes any portion of this Section7 to be unenforceable because of the duration of such provision or the areacovered thereby, such court shall have the power to reduce the duration or areaof such provision and, in its reduced form, such provision shall then beenforceable and shall be enforced. The Executive agrees that this Section 7,as so amended, shall be valid and binding as though any invalid orunenforceable provision had not been included herein. Notwithstanding
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any arbitration provisions contained in this Agreement, the Company shallhave the right and remedy to have the provisions of this Section 7 specificallyenforced by a court of competent jurisdiction without any requirement to firstseek a remedy through arbitration, including by temporary and/or permanentinjunction, it being acknowledged and agreed that any such violation may causeirreparable injury to the Company and that money damages will not provide anadequate remedy to the Company. The Company shall also have the right to seekdamages for any breach of this Section 7.
          (d) Upon written notice to Executive in accordance with Section 10 thatExecutive is in breach of any covenant contained in this Section 7, and withoutlimiting any other remedy available to the Company at law or in equity, allstock options granted to Executive pursuant to Section 3(e), notwithstandingany prior vesting, shall immediately terminate unless such breach is capable ofcure and the Executive remedies such breach within 20 days of notification orotherwise objects to the claim that he is in violation of this Section 7, inwhich case such options shall terminate only upon a finding by an arbitratorthat he was in breach; provided that all vesting during any such period ofdispute shall be suspended for the period of such dispute and Executive shalleffect no transfers or exercises of any options during the period of suchdispute. . The Company shall also be entitled to cease making any payments andproviding any benefits otherwise required under this Agreement.
     8. Confidentiality. Executive agrees that while in the employ of theCompany (otherwise than in the performance of his duties hereunder), he shallnot, disclose to any person, firm, corporation, entity or business organizationany Confidential Information (as hereinafter defined), but this Section 8 shallnot prevent Executive from responding to any subpoena, court order or threat ofother legal duress. The term “Confidential Information” shall mean informationdisclosed to Executive by the Company during the Executive’s employmenthereunder relating to the business of the Company, to the extent that (i) suchinformation is considered proprietary by the Company and (ii) disclosure ofsuch information by the Company would be materially adverse to the Company;provided, however, that the following shall not be deemed to be ConfidentialInformation: (a) information which is or becomes publicly known other than as aresult of a breach of this provision by Executive; (b) information lawfully inthe possession of Executive prior to disclosure to him by the Company; or (c)information disclosed to Executive by any third party who is not affiliatedwith the Company or otherwise subject to a confidentiality obligation in favorof the Company.
     9. Delivery of Materials. Executive agrees that within 10 days of thetermination of his employment for any reason he will deliver to the Company alldocuments, papers, materials and other tangible property of the Companyrelating to its affairs which may then be in his possession or under hiscontrol.
     10. Notices. All notices to be given hereunder shall be deemed duly givenas of the date delivered if in writing and delivered in person or bytelecopier, or mailed by registered or certified mail, return receiptrequested, postage prepaid, or sent by overnight courier with guaranteed nextday delivery, and addressed as follows:
          (a) If to be given to the Company:
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        OPENTV CORP.   275 Sacramento Street   San Francisco, California 94111   Attention: General Counsel   Fax: (415) 962-5364      (b) If to be given to Executive:        Mr. James Chiddix   40 E. 94th St., #20-A   New York, New York 10128
                    or to such other address as either of the parties may have furnished tothe other in writing in accordance with this Section 10, except that notices ofchanges of address shall not be deemed given until actually received by theaddressee.
     11. Successors.
               (a) This Agreement is personal to Executive and without the prior writtenconsent of the Company shall not be assignable by Executive otherwise than bywill or the laws of descent and distribution. This Agreement shall inure tothe benefit of and be enforceable by Executive’s heirs, executors and otherlegal representatives. However, no rights or obligations of the Company underthis Agreement may be assigned or transferred by the Company except that suchrights or obligations may be assigned or transferred pursuant to a merger orconsolidation in which the Company is not the continuing entity or the sale orliquidation of all or substantially all of the assets of the Company.
               (b) This Agreement shall inure to the benefit of and be binding upon theCompany and its successors and assigns.
     12. Indemnification. As promptly as practicable after the Effective Date,the Company and Executive shall enter into an indemnity agreement providing forthe indemnification of Executive consistent with the form of indemnityagreement provided to other senior executives of the Company.
     13. Miscellaneous.
               (a) Entire Agreement. This Agreement constitutes the entire agreementbetween the parties with respect to the subject matter hereof, replacing andsuperseding as of the date hereof any and all negotiations, discussions,agreements and understandings, including all term sheets, with respect to thesubject matter hereof, whether oral or written, between the parties hereto.
               (b) Severability. If any of the provisions of this Agreement shall, forany reason, be declared invalid, illegal or unenforceable in any respect byfinal judgment of any court or administrative body of competent jurisdiction,(i) such invalidity, illegality or unenforceability shall not affect thevalidity, legality or enforceability of any other provision of this Agreement,
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and (ii) this Agreement shall be construed as if such invalid, illegal orunenforceable provision had never been contained herein.
               (c) Tax Withholding. The Company may withhold from any amounts payableunder this Agreement such Federal, state or local taxes as shall be required tobe withheld pursuant to any applicable law or regulation.
               (d) No Waiver. Executive’s or the Company’s failure to insist upon strictcompliance with any provision hereof or any other provision of this Agreementor the failure 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 otherprovision or right of this Agreement.
               (e) Headings. The headings of Sections and subsections hereof areincluded for convenience of reference only and are not to be considered whenconstruing the provisions of this Agreement.
               (f) Amendments; Waivers. This Agreement may not be amended, modified orotherwise changed nor may any provision hereof be waived except by aninstrument in writing duly executed by the parties hereto or their respectivesuccessors and heirs, executors and other legal representatives.
               (g) Governing Law. This Agreement shall be governed by and construed inaccordance with the internal laws of the State of California, without referenceto principles of conflict of laws.
               (h) Arbitration. Subject to the final sentence of this Section 13(h), alldisputes concerning Executive’s employment with the Company, the terminationthereof, the breach by either party of the terms of this Agreement or any othermatters relating to or arising from Executive’s employment with the Companyshall be resolved in binding arbitration in a proceeding in San Francisco,California, administered by and under the rules and regulations of the AmericanArbitration Association. Both parties and the arbitrator will treat thearbitration process and the activities that occur in the proceedings asconfidential. Nothing contained in this Section 12(h) shall limit theCompany’s right to seek equitable relief in any court of competent jurisdictionin respect of the matters set forth in Section 7.
               (i) Construction. The definitions of capitalized terms used herein shallapply equally to both the singular and plural forms of the terms defined.Whenever the context may require, any pronoun shall include the correspondingmasculine, feminine and neuter forms. As used herein, the term “mostfavorable” shall, when used with reference to any plans, practices, policies orprograms of the Company and its affiliates, be deemed to refer to the plans,practices, policies or programs of the Company and its affiliates, as in effectat any time during the Employment Term and provided to employees of the Companygenerally or to any other executive officer or key employee of the Company orits affiliates, which are most favorable to Executive. The words “include”,“includes” and “including” shall be deemed to be followed by the phrase“without limitation”. The words “herein”, “hereof” and “hereunder” and wordsof similar import refer to this Agreement in its entirety and not to any parthereof unless the context shall otherwise require. All references herein toSections shall be deemed references to Sections
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of this Agreement unless the context shall otherwise require. Unless thecontext shall otherwise require, any references to any statute or regulationare to it (and any successor thereof) as amended and supplemented from time totime. Any reference in this Agreement to a “day” or number of “days” (withoutthe explicit qualification of “business”) shall be interpreted as a referenceto a calendar day or number of calendar days. If any action or notice is to betaken or given on or by a particular calendar day, and such calendar day is nota business day, then such action or notice shall be deferred until, or may betaken or given on, the next business day.
               (j) Counterparts. This Agreement may be executed in counterparts, each ofwhich shall be deemed to be an original, and all of which together shall bedeemed to be one and the same instrument.
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     IN WITNESS WHEREOF, this Agreement has been executed as of the day andyear first above written.         OPENTV CORP.        By: /s/ Wesley Hoffman           Name: Wesley Hoffman