Exhibit 10.1


 


MUTUAL TERMINATION
AGREEMENT


 


MUTUAL TERMINATION AGREEMENT, dated as of November 18,
2005 (this “Agreement”), by and among BroadVision, Inc. (the “Company”),
a Delaware corporation, Bravo Holdco (“Parent”), an exempted company
with limited liability incorporated under the laws of the Cayman Islands and
Bravo Merger Sub, LLC (“Merger Sub”), a Delaware limited liability
company.


 


RECITALS


 


WHEREAS, the Company, Parent and Merger Sub
are parties to an Agreement and Plan of Merger, dated as of July 25, 2005
(as amended, the “Merger Agreement”) (capitalized terms used herein but
not otherwise defined herein shall have the meanings ascribed to them in the
Merger Agreement); and


 


WHEREAS, the Company, Parent and Merger Sub
wish to terminate the Merger Agreement.


 


NOW THEREFORE, in consideration of the
foregoing and the mutual covenants and agreements contained herein, and
intending to be legally bound hereby, the Company, Parent and Merger Sub hereby
agree as follows:


 


1.                                       The
Company, Parent and Merger Sub hereby agree that (i) subject to Section 3
hereof, the Merger Agreement is terminated as of the date hereof by mutual
written consent in accordance with Section 7.1(a) thereof without any
liability on the part of Parent, Merger Sub, the Company, or any of their
respective parents, subsidiaries, directors, officers, agents, representatives,
shareholders and other affiliates (“Related Parties”) (and each of their
respective Related Parties), except as provided herein, and (ii) the
Company shall pay to Parent an amount of cash equal to $980,000 plus interest
accruing at an annual rate of 6% ($161.10 per day) from and after the date
hereof until the date such amount is paid in full (collectively, the “Expense
Reimbursement”) on or before January 17, 2006 by wire transfer in
immediately available funds to Parent pursuant to the written instructions
provided to the Company by Parent.  If
the Company fails to make the required payment in a timely manner, Parent and
Merger Sub shall be entitled to exercise the rights and shall be entitled to
indemnification set forth in Section 7.3(h) of the Merger Agreement.


 


2.                                       Each
of the Company, Parent and Merger Sub, on behalf of itself and all present or
former parents, subsidiaries and other affiliates, hereby releases the other
parties and their Related Parties (and each of their respective Related
Parties) from all claims, demands, debts, liabilities, obligations, agreements,
promises, losses, damages, demands, rights, actions or causes of action,
whether known or unknown, whether at law or equity, whether direct or
derivative (herein “Claim” or “Claims”) arising under or relating
to the Merger Agreement or any of the transaction(s) described or referred to
in the Merger Agreement; provided however, that nothing in this Agreement shall
be


 


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construed to
release any Claim arising under or relating to the Non-Disclosure Agreement,
this Agreement or the Transfer Agreement (as defined below).


 


3.                                       It
is a condition precedent to the effectiveness of this Agreement that Pehong
Chen enter into that certain transfer agreement with Vector Capital III, L.P.,
an affiliate of Parent and Merger Sub (“Vector III”), in the form
attached hereto as Exhibit A  (the “Transfer
Agreement”), pursuant to which Pehong Chen agrees to cause Honu Holdings
LLC to acquire the entire rights, title and interest in, to and under those
certain Senior Subordinated Secured Convertible Notes (the “Note”) of
the Company of an aggregate principal amount of $12,799,999 held by Vector III
and consummate the transactions contemplated thereby, including the full
payment of the Purchase Price (as defined in the Transfer Agreement) to Vector
III.


 


4.                                       Each
of the Company, Parent and Merger Sub hereby represents and warrants to the
other parties that: (a) it has full power and authority to enter into this
Agreement and to perform its obligations hereunder in accordance with its
provisions, (b) this Agreement has been duly authorized, executed and
delivered by such party, and (c) this Agreement constitutes a legal, valid
and binding obligation of such party, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, moratorium or
other similar laws affecting creditors’ rights generally and by general
principles of equity.


 


5.                                       This
Agreement shall be construed and enforced in accordance with, and be governed
by, the laws of the State of Delaware without regard to its conflict of law
provisions, and it may not modified, amended or terminated, nor may the
provisions hereof be waived, other than in a written instrument executed by all
parties hereto.


 


6.                                       This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, all of which together shall constitute one and the same
instrument.


 


[The remainder of this page is intentionally left blank.]


 


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IN WITNESS WHEREOF, each of the undersigned
has duly executed this Mutual Termination Agreement as an agreement as of the
date first above written.


 


	
   

  	
  BRAVO HOLDCO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christopher Nicholson

  
	
   

  	
   

  	
  Name:

  	
  Christopher Nicholson

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BRAVO MERGER SUB, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christopher Nicholson

  
	
   

  	
   

  	
  Name:

  	
  Christopher Nicholson

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BROADVISION, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Pehong Chen

  
	
   

  	
   

  	
  Name:

  	
  Pehong Chen

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  



 


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EXHIBIT A


 


TRANSFER AGREEMENT


 


THIS TRANSFER AGREEMENT, dated as of November 18,
2005 (this “Agreement”), is between Vector Capital III, L.P.  (the “Seller”), Pehong Chen (the “Buyer”)
and BroadVision, Inc., a Delaware corporation (the “Issuer”).


 


WHEREAS, on November 9, 2005, the Seller
acquired the entire rights, title and interest in, to and under those certain
Senior Subordinated Secured Convertible Notes of the Issuer of an aggregate
principal amount of $12,799,999 (the “Note”); and,


 


WHEREAS, the Seller desires to sell and
assign to the Buyer, and the Buyer desires to purchase from the Seller, the
Seller’s entire rights, title and interest in, to and under the Note (such
sale, assignment and purchase, the “Transaction”).


 


NOW, THEREFORE, in consideration of the
mutual agreements set forth herein, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:


 


1.                                       Pursuant to the
terms hereof, the Seller hereby sells, transfers, assigns, delegates and
conveys unto the Buyer’s assignee, Honu Holdings LLC, a Delaware limited
liability company wholly owned by the Buyer (“Holdings”), without
recourse, any and all rights, title, interests, duties and obligations to the
Note, including, without limitation, all rights, title, interests, duties and
obligations arising out of or incurred in connection with such assets, for an
aggregate purchase price equal to the sum of (i) $15,359,999 (equal to
120% of the Principal to be assigned), and (ii) accrued and unpaid
interest (including default interest) on such Principal equal to $120,526 as of
November 21, 2005 and accruing at a rate of $2,104.11 per day for each day
thereafter (the “Purchase Price”), payable no later than the close of
business on the first business day after the date hereof. The Buyer, on behalf
of himself and Holdings, hereby accepts the foregoing assignment and
delegation, accepts the Note and assumes all of the Seller’s rights, title,
interests, duties and obligations (whether arising before or after execution of
this Agreement) with respect to the Note. Each of the Buyer and the Seller
shall take all necessary actions to consummate the sale and transfers
contemplated hereunder and to vest legal title to the Note in Holdings,
including (a) complying with the requirements of Section 2(f) of
the Securities Purchase Agreement, dated as of November 10, 2004, by and
among the Issuer, the Seller and certain other parties (the “Securities
Purchase Agreement”), and (b) surrendering the Note to the Issuer and
requesting that the Issuer issue and deliver a replacement Senior Subordinated
Secured Convertible Note of the Issuer in the name of Holdings in accordance
with the procedures described in Section 19 of the Note.


 


2.                                       Each of the
Buyer and the Seller has, or may have obtained, material non-public information
concerning the Issuer and the Note (“Excluded Information”) and is
precluded from sharing any such Excluded Information with the other party. In
connection therewith, the Buyer and the Seller each acknowledge, understand and
agree,


 


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as follows: (a) the
Buyer has requested that the Seller not disclose to it any of the Seller’s
Excluded Information, and the Seller has requested that the Buyer not disclose
to it any of the Buyer’s Excluded Information, and (b) the Seller has
complied with the Buyer’s request not to disclose to the Buyer the Seller’s
Excluded Information, and the Buyer has complied with the Seller’s request not
to disclose to the Seller the Buyer’s Excluded Information. As a consequence of
such non-disclosure of each party’s Excluded Information, there may exist a
disparity of information between the Buyer and the Seller with respect to the
Note and/or the Issuer. Each of the Buyer and the Seller acknowledges that if
it had been informed of the other party’s Excluded Information, the Note may
have a lesser or greater value than the Purchase Price. Each of the Buyer and
the Seller acknowledges it may not be in such party’s best interest to proceed
with the Transaction at this time.


 


3.                                       As a condition
to the Buyer’s agreement to buy, and the Seller’s agreement to sell, the Note: (a) the
Buyer, on behalf of himself and Holdings, expressly releases the Seller from
any and all liabilities arising from the Seller’s failure to disclose the
Seller’s Excluded Information, or the Buyer’s inability to review the Seller’s
Excluded Information, and (b) the Seller expressly releases the Buyer and
Holdings from any and all liabilities arising from the Buyer’s failure to
disclose the Buyer’s Excluded Information, or the Seller’s inability to review
the Buyer’s Excluded Information, provided, however, in either case, that the
Seller’s Excluded Information shall not and does not affect the truth or
accuracy of the Seller’s representations and warranties made herein and the
Buyer’s Excluded Information shall not and does not affect the truth or
accuracy of the Buyer’s representations and warranties made herein.


 


4.                                       The Buyer
represents, warrants and acknowledges, as applicable, that each of the Buyer and
Holdings: (a) is a sophisticated purchaser with respect to the Note, (b) has
adequate information concerning the Note, (c) has adequate information
concerning the business and financial condition of the Issuer and any
affiliates of the Issuer, (d) has conducted, to the extent he or it deemed
necessary, an independent investigation of such matters as, in his or its
judgment, is necessary for it to make an informed investment decision with
respect to the Note, the Issuer and the Transaction, (e) has not relied
upon the Seller for any investigation into, assessment of, or evaluation with
respect to the Note, the Issuer and/or the Transaction, (f) is buying the
Note as principal, for his or its own account and not as a broker or agent for
another party, and for investment purposes only, and not with a view toward
distribution or resale, and (g) is an accredited investor, as defined in Rule 501
under the Securities Act of 1933, as amended.


 


5.                                       The Seller
represents, warrants and acknowledges, as applicable, that it: (a) is a
sophisticated seller with respect to the Note, (b) has adequate
information concerning the Note, (c) has adequate information concerning
the business and financial condition of the Issuer and any affiliates of the
Issuer, (d) has conducted, to the extent it deemed necessary, an
independent investigation of such matters as, in its judgment, is necessary for
it to make an informed investment decision with respect to the Note, the Issuer
and the Transaction, (e) has not relied upon the Buyer or Holdings for any
investigation into, assessment of, or evaluation with respect to the Note, the
Issuer and/or the Transaction, (f) acquired the Note as principal, for its
own account and not as a broker 


 


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or agent for
another party, and for investment purposes only and not with a view toward
distribution or resale, (g) holds good and valid legal title to the Note
free and clear of all liens, claims and encumbrances, and (h) has not
engaged in any form of general solicitation or advertising in connection with
the sale of the Note.


 


6.                                       Notwithstanding
anything in this Transfer Agreement, the Securities Purchase Agreement, the
Note or the Noteholders Agreement dated as of October 21, 2005, between
the Issuer and certain other parties thereto (collectively, the “Notes
Documents”) to the contrary, the Buyer agrees that he shall not deliver to
the Issuer any Event of Default Redemption Notice for any reason or exercise
any other remedies under the Notes Documents from and after the date hereof
until the second business day after the Expense Reimbursement (as defined in
the Mutual Termination Agreement referred to below) (including interest, fees,
expenses, charges or other amounts accruing on or after the filing of any
petition in bankruptcy or for reorganization at the rate or in the amount
otherwise applicable thereto, whether or not any such interest, fees, expenses,
charges or other amount is an allowed claim, the “Termination Payment”)
is paid in full in cash to Bravo Holdco, an exempted company with limited
liability incorporated under the laws of the Cayman Islands and affiliate of
Vector III, pursuant to that certain Mutual Termination Agreement entered into
by and among the Issuer, Bravo Holdco, and Bravo Merger Sub, LLC, a Delaware
limited liability company and wholly owned subsidiary of Bravo Holdco, dated as
of the date hereof (the “Mutual Termination Agreement”).


 


7.                                       Notwithstanding
anything in the Notes Documents to the contrary, each of the Buyer, the Seller
and the Issuer agree that from and after the date hereof and until two business
days after the Termination Payment is paid in full in cash (the “Expiration
Date”): (a) the Buyer agrees to defer, and hereby gives notice to the
Issuer of his election to defer, all principal and interest and any other fees,
payments or penalties that are due or become due under the Note from and after
the date hereof until the Expiration Date; and (b) the Issuer agrees not
to pay any principal, interest or any other fees, payments or penalties that
are due under the Note or become due from and after the date hereof until the
Expiration Date.


 


8.                                       The
Buyer further covenants and agrees that the Issuer’s obligations to make any
payments under the Note, including principal, interest or any other fees,
payments or penalties (the “Subordinated Payments”) are hereby expressly
made subordinate and subject in right of payment to the prior payment in full
of the Termination Payment in cash, all to the extent and in the manner provided
in the Mutual Termination Agreement. The Issuer shall not make any Subordinated
Payments until the Expiration Date.  Upon
any payment or distribution of assets of the Issuer of any kind or character,
whether in cash, securities or other property, to creditors of the Issuer in a
bankruptcy, insolvency, receivership, assignment for the benefit of creditors,
marshalling of assets or similar proceeding of or relating to the Issuer or its
property, assets or creditors, the Seller shall be entitled to receive payment
in full, in cash, of the Termination Payment before the Buyer shall be entitled
to receive any payment of principal or interest or any other payment or
distribution of assets with respect to any Subordinated Payments, and until the
Termination Payment is paid in full as provided herein, any payment or
distribution of assets of the Issuer of any kind or character,


 


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whether in
cash, securities or property, to which the Buyer would be entitled but for the
subordination provisions in this Agreement shall be made by the Issuer or by
any receiver, trustee in bankruptcy, liquidating trustee, agent or other person
making such payment or distribution directly to the Seller to the extent
necessary to pay the Termination Payment in full in cash.  In the event that, notwithstanding the
provisions of this Agreement, the Issuer shall make any Subordinated Payment to
the Buyer not expressly authorized under the terms hereof, such Subordinated
Payment shall be held in trust by the Buyer for the benefit of the Seller and
shall be paid over immediately (without necessity of demand) to the Seller, for
application to the payment of the Termination Payment until the same shall have
been paid in full in cash.


 


9.                                       The Buyer agrees
that each of the representations, covenants and agreements of the Buyer herein
(including without limitation the prohibitions and limitations set forth in
Sections 6, 7 and 8 hereof) shall also be deemed to be a representation,
covenant and agreement of Holdings as if originally made by Holdings herein and
that any breach thereof by Holdings shall be deemed to be a breach thereof by
the Buyer. The Buyer shall indemnify and hold harmless the Seller against any
breach by Holdings of any such representation, covenant or agreement.


 


10.                                 Each of the Buyer and
the Seller hereby represents and warrants to the other party that: (a) it
has full power and authority to enter into this Agreement and to perform its
obligations hereunder in accordance with its provisions, (b) this
Agreement has been duly authorized, executed and delivered by such party, and (c) this
Agreement constitutes a legal, valid and binding obligation of such party,
enforceable in accordance with its terms, except as enforceability may be limited
by applicable bankruptcy, moratorium or other similar laws affecting creditors’
rights generally and by general principles of equity.


 


11.                                 Each party
acknowledges that the other party is relying on this Agreement in engaging in
the Transaction, and would not engage in the Transaction in the absence of this
Agreement and the provisions contained herein.


 


12.                                 The foregoing
representations, warranties, acknowledgments and agreements shall be deemed
made as of the date of this Agreement and shall survive the sale and delivery
of the Note hereunder.


 


13.                                 This Agreement may be
executed by manual or facsimile signature, and in one or more counterparts,
each of which shall be deemed an original, but all of which when taken together
shall be deemed to be one and the same instrument.


 


[Remainder of Page Intentionally Left Blank; Signature Page Follows]


 


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IN WITNESS WHEREOF, the undersigned have
caused this Agreement to be duly executed as of the date set forth above.


 


 


	
   

  	
  SELLER:

  
	
   

  	
   

  
	
   

  	
  VECTOR
  CAPITAL III, L.P.

  
	
   

  	
   

  
	
   

  	
  By: Vector
  Capital Partners III, L.L.C., its

  General Partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BUYER:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PEHONG CHEN

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Signed:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ISSUER:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BROADVISION, INC.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
								



 


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