Document:

Exhibit 10.2

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (“Agreement”) is entered into by and between Jeffrey W. Kip  (“Executive”) and IAC/InterActiveCorp, a Delaware corporation (the “Company”), and is effective as of March 20, 2012 (the “Effective Date”).

 

WHEREAS, the Company desires to establish its right to the services of Executive, in the capacity described below, on the terms and conditions hereinafter set forth, and Executive is willing to accept such employment on such terms and conditions.

 

NOW, THEREFORE, in consideration of the mutual agreements hereinafter set forth, Executive and the Company have agreed and do hereby agree as follows:

 

1A.          EMPLOYMENT.  During the Term (as defined below), the Company shall employ Executive, and Executive shall be employed, as the Company’s Executive Vice President and Chief Financial Officer.  During Executive’s employment with the Company, Executive shall do and perform all services and acts necessary or advisable to fulfill the duties and responsibilities as are commensurate and consistent with Executive’s position and shall render such services on the terms set forth herein.  During Executive’s employment with the Company, Executive shall report directly to the Chief Executive Officer of the Company or such person as may from time to time be designated by the Company (hereinafter referred to as the “Reporting Officer”).  Executive shall have such powers and duties with respect to the Company as may reasonably be assigned to Executive by the Reporting Officer, to the extent consistent with Executive’s position.  Executive agrees to devote all of Executive’s working time, attention and efforts to the Company and to perform the duties of Executive’s position in accordance with the Company’s policies as in effect from time to time.    Executive’s principal place of employment shall be at the Company’s offices located in New York, New York.

 

2A.          TERM.  The term of this Agreement shall commence on the Effective Date and shall continue for a period of one (1) year.  This Agreement shall automatically be renewed for successive one-year periods in perpetuity unless one party hereto provides written notice to the other, at least ninety (90) days prior to the end of the then current one-year employment period, that it elects not to extend this Agreement, which notice shall be irrevocable (any such notice, a “Non-Renewal Notice”).  The period beginning on the date hereof and ending on the first anniversary hereof or, if the Agreement is renewed pursuant to the prior sentence, the last day of the last one-year renewal period, shall be referred to hereinafter as the “Term.”

 

Notwithstanding anything to the contrary in this Section 2A, Executive’s employment hereunder may be terminated in accordance with the provisions of Section 1 of the Standard Terms and Conditions attached hereto.

 

3A.          COMPENSATION.

 

(a)           BASE SALARY.  During the period that Executive is employed with the Company hereunder, the Company shall pay Executive an annual base salary of $575,000 (the “Base Salary”), payable in equal biweekly installments (or, if different, in accordance with the Company’s payroll practice as in effect from time to time).  The Base Salary may be increased from time to time in the discretion of the Compensation and Human Resources Committee of the

 

 

Company (the “Compensation Committee”). For all purposes under this Agreement, the term “Base Salary” shall refer to the Base Salary as in effect from time to time.

 

(b)           DISCRETIONARY BONUS.  During the period that Executive is employed with the Company hereunder, Executive shall be eligible to receive discretionary annual bonuses.

 

(c)           GRANT OF IAC EQUITY AWARDS.   On the Effective Date, Executive shall be granted, under and subject to the provisions of IAC’s 2008 Stock & Annual Incentive Plan (the “2008 Plan”), (i) an award of 20,000 IAC Restricted Stock Units (the “RSU Award”), (ii) an award of 150,000  options to purchase shares of common stock of IAC with an exercise price equal to the fair market value on the grant date (the “FMV Stock Option Award”) and (iii) an award of 50,000  options to purchase shares of common stock of IAC with an exercise price equal to the greater of (x) the fair market value on the grant date and (y) $60.00 (the “Premium Stock Option Award”).  The actual vesting and other terms and conditions of  the RSU Award, the FMV Stock Option Award  and the Premium Option Award will be governed by the award notices and related terms and conditions attached as Exhibit A and the 2008 Plan.  Executive shall remain eligible for future equity grants during the Term of his employment with the Company.

 

(d)          BENEFITS.  From the Effective Date through the date of termination of Executive’s employment with the Company for any reason, Executive shall be entitled to participate in any welfare, health and life insurance, pension benefit and incentive programs as may be adopted from time to time by the Company on the same basis as that provided to similarly situated employees of the Company.  Without limiting the generality of the foregoing, Executive shall be entitled to the following benefits:

 

(i)            Reimbursement for Business Expenses.  During the period that Executive is employed with the Company hereunder, the Company shall reimburse Executive for all reasonable, necessary and documented expenses incurred by Executive in performing Executive’s duties for the Company, on the same basis as similarly situated employees generally and in accordance with the Company’s policies as in effect from time to time; and

 

(ii)           Vacation.  During the period that Executive is employed with the Company hereunder, Executive shall be entitled to paid vacation each year, in accordance with the plans, policies, programs and practices of the Company applicable to similarly situated employees of the Company generally.

 

4A.          NOTICES.  All notices and other communications under this Agreement shall be in writing and shall be given by first-class mail, certified or registered with return receipt requested, or by hand delivery, or by overnight delivery by a nationally recognized carrier, in each case to the applicable address set forth below, and any such notice is deemed effectively given when received by the recipient (or if receipt is refused by the recipient, when so refused):

 

	
If to the Company:
    	
 
    	
c/o   IAC/InterActiveCorp
    
	
 
    	
 
    	
555   West 18th Street, 6th Floor
    
	
 
    	
 
    	
New   York, NY 10011
    
	
 
    	
 
    	
Attention:   General Counsel
    

 

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If to Executive:
    	
 
    	
At   the most recent address for Executive on file at the Company.
    

 

Either party may change such party’s address for notices by notice duly given pursuant hereto.

 

5A.          GOVERNING LAW; JURISDICTION.  This Agreement and the legal relations thus created between the parties hereto (including, without limitation, any dispute arising out of or related to this Agreement) shall be governed by and construed under and in accordance with the internal laws of the State of New York without reference to its principles of conflicts of laws.  Any such dispute will be heard exclusively and determined before an appropriate federal court located in the State of New York in New York County, or, if not maintainable therein, then in an appropriate New York state court located in New York County, and each party hereto submits itself and its property to the exclusive jurisdiction of the foregoing courts with respect to such disputes.  The parties hereto acknowledge and agree that this Agreement was executed and delivered in the State of New York, that the Company is headquartered in New York City and that, in the course of performing duties hereunder for the Company, Executive shall have multiple contacts with the business and operations of the Company, as well as other businesses and operations in the State of New York, and that for those and other reasons this Agreement and the undertakings of the parties hereunder bear a reasonable relation to the State of New York.  Each party hereto (i) agrees that service of process may be made by mailing a copy of any relevant document to the address of the party set forth above, (ii) waives to the fullest extent permitted by law any objection which it may now or hereafter have to the courts referred to above on the grounds of inconvenient forum or otherwise as regards any dispute between the parties hereto arising out of or related to this Agreement, (iii) waives to the fullest extent permitted by law any objection which it may now or hereafter have to the laying of venue in the courts referred to above as regards any dispute between the parties hereto arising out of or related to this Agreement and (iv) agrees that a judgment or order of any court referred to above in connection with any dispute between the parties hereto arising out of or related to this Agreement is conclusive and binding on it and may be enforced against it in the courts of any other jurisdiction.

 

6A.          COUNTERPARTS.  This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

 

7A.          STANDARD TERMS AND CONDITIONS.  Executive expressly understands and acknowledges that the Standard Terms and Conditions attached hereto are incorporated herein by reference, deemed a part of this Agreement and are binding and enforceable provisions of this Agreement.  References to “this Agreement” or the use of the term “hereof” shall refer to this Agreement and the Standard Terms and Conditions attached hereto, taken as a whole.

 

[The Signature Page Follows]

 

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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed and delivered by its duly authorized officer and Executive has executed and delivered this Agreement on February 7, 2012.

 

	
 
    	
IAC/INTERACTIVECORP
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Gregg Winiarski
    
	
 
    	
By:
    	
Gregg   Winiarski
    
	
 
    	
Title:
    	
Senior   Vice President, General Counsel and Secretary
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Jeffrey W. Kip
    
	
 
    	
JEFFREY   W. KIP
    

 

 

STANDARD TERMS AND CONDITIONS

 

1.             TERMINATION OF EXECUTIVE’S EMPLOYMENT.

 

(a)           DEATH.  In the event Executive’s employment hereunder is terminated by reason of Executive’s death, the Company shall pay Executive’s designated beneficiary or beneficiaries, within thirty (30) days of Executive’s death in a lump sum in cash, (i) Executive’s Base Salary through the end of the month in which death occurs and (ii) any other Accrued Obligations (as defined in paragraph 1(f) below).

 

(b)           DISABILITY.  If, as a result of Executive’s incapacity due to physical or mental illness (“Disability”), Executive shall have been absent from the full-time performance of Executive’s duties with the Company for a period of four (4) consecutive months and, within thirty (30) days after written notice is provided to Executive by the Company (in accordance with Section 4A hereof), Executive shall not have returned to the full-time performance of Executive’s duties, Executive’s employment under this Agreement may be terminated by the Company for Disability.  During any period prior to such termination during which Executive is absent from the full-time performance of Executive’s duties with the Company due to Disability, the Company shall continue to pay Executive’s Base Salary at the rate in effect at the commencement of such period of Disability, offset by any amounts payable to Executive under any disability insurance plan or policy provided by the Company.  Upon termination of Executive’s employment due to Disability, the Company shall pay Executive within thirty (30) days of such termination (i) Executive’s Base Salary through the end of the month in which termination occurs in a lump sum in cash, offset by any amounts payable to Executive under any disability insurance plan or policy provided by the Company; and (ii) any other Accrued Obligations (as defined in paragraph 1(f) below).

 

(c)           TERMINATION FOR CAUSE.  Upon the termination of Executive’s employment by the Company for Cause (as defined below), the Company shall have no further obligation hereunder, except for the payment of any Accrued Obligations (as defined in paragraph 1(f) below).  As used herein, “Cause” shall mean:  (i) the plea of guilty or nolo contendere to, or conviction for, the commission of a felony offense by Executive; provided, however, that after indictment, the Company may suspend Executive from the rendition of services, but without limiting or modifying in any other way the Company’s obligations under this Agreement; provided, further, that Executive’s employment shall be immediately reinstated if the indictment is dismissed or otherwise dropped and there is not otherwise grounds to terminate Executive’s employment for Cause; (ii) a material breach by Executive of a fiduciary duty owed to the Company; provided that the Reporting Officer determines, in his/her good faith discretion, that such material breach undermines his/her confidence in Executive’s fitness to continue in his position, as evidenced in writing from the Reporting Officer (it being understood that the determination as to whether such material breach occurred is not in the good faith discretion of the Reporting Officer); (iii) a material breach by Executive of any of the covenants made by Executive in Section 2 hereof; (iv) Executive’s continued willful or gross neglect of the material duties required by this Agreement; or (v) a knowing and material violation by Executive of any material Company policy pertaining to ethics, wrongdoing or conflicts of interest;

 

 

provided, that in the case of conduct described in clauses (iii), (iv) or (v) above which is capable of being cured, Executive shall have a period of ten (10) days after Executive is provided with written notice thereof in which to cure.

 

(d)           TERMINATION BY THE COMPANY OTHER THAN FOR DEATH, DISABILITY OR CAUSE OR RESIGNATION BY EXECUTIVE FOR GOOD REASON.  If Executive’s employment hereunder is terminated prior to the expiration of the Term by the Company for any reason other than Executive’s death or Disability or for Cause or if Executive resigns for Good Reason (as defined below) prior to the expiration of the Term, then

 

(i)            the Company shall continue to pay to Executive the Base Salary for twelve (12) months from the date of such termination or resignation (the “Severance Period”), payable in equal biweekly installments (or otherwise based on the Company’s payroll practice as in effect from time to time) over the course of such twelve (12) months;

 

(ii)           the Company shall pay Executive within thirty (30) days of the date of such termination in a lump sum in cash any Accrued Obligations (as defined in paragraph 1(f) below); and

 

(iii)          if such termination of employment occurs before the first anniversary of the Effective Date, then the RSU Award shall accelerate and vest as of the date of termination of employment.

 

The payment to Executive of the severance benefits described in this Section 1(d) (including any accelerated vesting) shall be subject to Executive’s execution and non-revocation within thirty (30) days following the date of termination of Executive’s employment with the Company of a general release of the Company and its affiliates, in a form substantially similar to that used for similarly situated executives of the Company and its affiliates (the “Release”) and Executive’s compliance with the restrictive covenants set forth in Section 2 hereof.  Executive acknowledges and agrees that the severance benefits described in this Section 1(d) constitute good and valuable consideration for such release.  In the event that Executive does not execute and deliver the Release within thirty days following the date of termination of employment, or in the event that Executive revokes the Release, the Company may require Executive to repay any amounts or benefits previously paid or provided to him pursuant to Section 1(d) (other than the Accrued Obligations) and the Company shall cease making additional payments or providing additional benefits pursuant to Section 1(d).

 

For purposes of this Agreement, “Good Reason” shall mean actions taken by the Company resulting in a material negative change in the employment relationship.  For these purposes, a “material negative change in the employment relationship” shall include the occurrence of any of the following without Executive’s prior written consent:  (A) a material diminution in the authorities, duties or responsibilities of the person to whom the Executive is required to report, (B) the material reduction in Executive’s title, duties or level of responsibilities as of the Effective Date, excluding for this purpose any such reduction that is an isolated and inadvertent action not taken in bad faith or that is authorized pursuant to this Agreement, but including any circumstances under which the Company is no longer publicly traded and is controlled by another company, (C) any material reduction in Executive’s Base

 

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Salary, (D) the relocation of Executive’s principal place of employment outside of the metropolitan area of Executive’s principal place of employment as of the Effective Date or (E) any other action or inaction that constitutes a material breach bythe Company of the Agreement, provided that in no event shall Executive’s resignation be for “Good Reason” unless (x) an event or circumstance constituting “Good Reason” shall have occurred and Executive provides the Company with written notice thereof within thirty (30) days after Executive has knowledge of the occurrence or existence of such event or circumstance, which notice specifically identifies the event or circumstance that Executive believes constitutes Good Reason, (y) the Company fails to correct the circumstance or event so identified within thirty (30) days after the receipt of such notice, and (z) Executive resigns within ninety (90) days after the date of delivery of the notice referred to in clause (x) above.

 

(e)           OFFSET.  If Executive obtains other employment during the Severance Period, the amount of any such remaining payments or benefits to be provided to Executive shall be reduced by the amount of compensation and benefits earned by Executive from such other employment through the end of such period.  For purposes of this Section 1(e), Executive shall have an obligation to inform the Company regarding Executive’s employment status during the Severance Period.

 

(f)            ACCRUED OBLIGATIONS.  As used in this Agreement, “Accrued Obligations” shall mean the sum of (i) any portion of Executive’s accrued but unpaid Base Salary through the date of death or termination of employment for any reason, as the case may be; (ii) any compensation previously earned but deferred by Executive (together with any interest or earnings thereon) that has not yet been paid and that is not otherwise to be paid at a later date pursuant to the executive deferred compensation plan of the Company, if any, and (iii) any reimbursements that Executive is entitled to receive under Section 3A(d)(i) of the Agreement.

 

(g)           NOTICE OF NON-RENEWAL.  If the Company delivers a Non-Renewal Notice to Executive then, provided Executive’s employment hereunder continues through the expiration date then in effect, effective as of such expiration date the Company and Executive shall have the same rights and obligations hereunder as they would if the Company had terminated Executive’s employment hereunder prior to the end of the Term for any reason other than Executive’s death, Disability or Cause.  Notwithstanding the foregoing, in no event shall the delivery of a Non-Renewal Notice by Executive to the Company in and of itself be deemed to be a resignation by Executive for Good Reason.

 

2.                                       CONFIDENTIAL INFORMATION; NON-COMPETITION; NON-SOLICITATION; AND PROPRIETARY RIGHTS.

 

(a)           CONFIDENTIALITY.  Executive acknowledges that, while employed by the Company, Executive will occupy a position of trust and confidence.  The Company, its subsidiaries and affiliates shall provide Executive with “Confidential Information” as referred to below.  Executive shall not, except as may be required to perform Executive’s duties hereunder or as required by applicable law, without limitation in time, communicate, divulge, disseminate, disclose to others or otherwise use, whether directly or indirectly, any Confidential Information regarding the Company or any of its subsidiaries or affiliates.

 

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“Confidential Information” shall mean information about the Company or any of its subsidiaries or affiliates, and their respective businesses, employees, consultants, contractors, clients and customers that is not disclosed by the Company or any of its subsidiaries or affiliates for financial reporting purposes or otherwise generally made available to the public (other than by Executive’s breach of the terms hereof) and that was learned or developed by Executive in the course of employment by the Company or any of its subsidiaries or affiliates, including (without limitation) any proprietary knowledge, trade secrets, data, formulae, information and client and customer lists and all papers, resumes, and records (including computer records) of the documents containing such Confidential Information.  Executive acknowledges that such Confidential Information is specialized, unique in nature and of great value to the Company and its subsidiaries or affiliates, and that such information gives the Company and its subsidiaries or affiliates a competitive advantage.  Executive agrees to deliver or return to the Company, at the Company’s request at any time or upon termination or expiration of Executive’s employment or as soon thereafter as possible, all documents, computer tapes and disks, records, lists, data, drawings, prints, notes and written information (and all copies thereof) furnished by the Company and its subsidiaries or affiliates or prepared by Executive in the course of Executive’s employment by the Company and its subsidiaries or affiliates.  As used in this Agreement, “subsidiaries” and “affiliates” shall mean any company controlled by, controlling or under common control with the Company.

 

(b)           NON-COMPETITION.  In consideration of this Agreement, and for other good and valuable consideration provided hereunder, the receipt and sufficiency of which are hereby acknowledged by Executive, Executive hereby agrees and covenants that, during Executive’s employment hereunder and for a period of twelve (12) months thereafter (the “Restricted Period”), Executive shall not, without the prior written consent of the Company, directly or indirectly, engage in or become associated with a Competitive Activity.  For purposes of this Section 2(b),  (i) a “Competitive Activity” means any business or other endeavor involving products or services that are the same or similar to products or services (the “Company Products or Services”) that any business of the Company is engaged in providing as of the date hereof or at any time during the Term, provided such business or endeavor is in the United States, or in any foreign jurisdiction in which the Company provides, or has provided during the Term, the relevant Company Products or Services, and (ii) Executive shall be considered to have become “associated with a Competitive Activity” if Executive becomes directly or indirectly involved as an owner, principal, employee, officer, director, independent contractor, representative, stockholder, financial backer, agent, partner, member, advisor, lender, consultant or in any other individual or representative capacity with any individual, partnership, corporation or other organization that is engaged in a Competitive Activity.

 

Notwithstanding anything else in this Section 2(b), (i) Executive may become employed by a partnership, corporation or other organization that is engaged in a Competitive Activity so long as Executive has no direct or indirect responsibilities or involvement in the Competitive Activity, (ii) Executive may own, for investment purposes only, up to five percent (5%) of the outstanding capital stock of any publicly-traded corporation engaged in a Competitive Activity if the stock of such corporation is either listed on a national stock exchange or on the NASDAQ National Market System and if Executive is not otherwise affiliated with such corporation, (iii) if Executive’s employment hereunder is terminated by the Company for any reason other than Executive’s death, Disability or Cause, or by Executive for Good Reason, then the restrictions

 

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contained in this Section 2(b) shall lapse, and (iv) Executive shall only be subject to the restrictions contained in this Section 2(b) to the extent the activity that would otherwise be prohibited by this section poses a reasonable competitive threat to the Company, which determination shall be made by the Company in good faith.

 

(c)           NON-SOLICITATION OF EMPLOYEES.  Executive recognizes that he will possess Confidential Information about other employees, consultants and contractors of the Company and its subsidiaries or affiliates relating to their education, experience, skills, abilities, compensation and benefits, and inter-personal relationships with suppliers to and customers of the Company and its subsidiaries or affiliates.  Executive recognizes that the information he will possess about these other employees, consultants and contractors is not generally known, is of substantial value to the Company and its subsidiaries or affiliates in developing their respective businesses and in securing and retaining customers, and will be acquired by Executive because of Executive’s business position with the Company.  Executive agrees that, during Executive’s employment hereunder and for a period of eighteen (18) months thereafter, Executive will not, directly or indirectly, solicit or recruit any employee of the Company or any of its subsidiaries or affiliates (or any individual who was an employee of the Company or any of its subsidiaries or affiliates at any time during the six (6) months prior to such act of hiring, solicitation or recruitment) for the purpose of being employed by Executive or by any business, individual, partnership, firm, corporation or other entity on whose behalf Executive is acting as an agent, representative or employee and that Executive will not convey any such Confidential Information or trade secrets about employees of the Company or any of its subsidiaries or affiliates to any other person except within the scope of Executive’s duties hereunder.  Notwithstanding the foregoing, Executive is not precluded from soliciting any individual who (i) initiates discussions regarding employment on his or her own, (ii) responds to any public advertisement or general solicitation or (iii) has been terminated by the Company prior to the solicitation.

 

(d)           NON-SOLICITATION OF BUSINESS PARTNERS.  During Executive’s employment hereunder, and for a period of twelve (12) months thereafter, Executive shall not, without the prior written consent of the Company, persuade or encourage any business partners or business affiliates of  the Company or any of its subsidiaries or affiliates to cease doing business with the Company or any of its subsidiaries or affiliates or to engage in any business competitive with the Company or its subsidiaries or affiliates.

 

(e)           PROPRIETARY RIGHTS; ASSIGNMENT.  All Employee Developments (defined below) shall be considered works made for hire by Executive for the Company or, as applicable, its subsidiaries or affiliates, and Executive agrees that all rights of any kind in any Employee Developments belong exclusively to the Company.  In order to permit the Company to exploit such Employee Developments, Executive shall promptly and fully report all such Employee Developments to the Company.  Except in furtherance of his obligations as an employee of the Company, Executive shall not use or reproduce any portion of any record associated with any Employee Development without prior written consent of the Company or, as applicable, its subsidiaries or affiliates.  Executive agrees that in the event actions of Executive are required to ensure that such rights belong to the Company under applicable law, Executive will cooperate and take whatever such actions are reasonably requested by the Company, whether during or after the Term, and without the need for separate or additional compensation.

 

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“Employee Developments” means any idea, know-how, discovery, invention, design, method, technique, improvement, enhancement, development, computer program, machine, algorithm or other work of authorship, whether developed, conceived or reduced to practice during or following the period of employment, that: (i) concerns or relates to the actual or anticipated business, research or development activities, or operations of the Company or any of its subsidiaries or affiliates, (ii) results from or is suggested by any undertaking assigned to Executive or work performed by Executive for or on behalf of the Company or any of its subsidiaries or affiliates, whether created alone or with others, during or after working hours, or (iii) uses, incorporates or is based on Company equipment, supplies, facilities, trade secrets or inventions of any form or type.  All Confidential Information and all Employee Developments are and shall remain the sole property of the Company or any of its subsidiaries or affiliates.  Executive shall acquire no proprietary interest in any Confidential Information or Employee Developments developed or acquired during the Term.  To the extent Executive may, by operation of law or otherwise, acquire any right, title or interest in or to any Confidential Information or Employee Development, Executive hereby assigns and covenants to assign to the Company all such proprietary rights without the need for a separate writing or additional compensation.  Executive shall, both during and after the Term, upon the Company’s request, promptly execute, acknowledge, and deliver to the Company all such assignments, confirmations of assignment, certificates, and instruments, and shall promptly perform such other acts, as the Company may from time to time in its discretion deem necessary or desirable to evidence, establish, maintain, perfect, enforce or defend the Company’s rights in Confidential Information and Employee Developments.

 

(f)            COMPLIANCE WITH POLICIES AND PROCEDURES.  During the period that Executive is employed with the Company hereunder, Executive shall adhere to the policies and standards of professionalism set forth in the policies and procedures of the Company and IAC as they may exist from time to time.

 

(g)           SURVIVAL OF PROVISIONS.  The obligations contained in this Section 2 shall, to the extent provided in this Section 2, survive the termination or expiration of Executive’s employment with the Company and, as applicable, shall be fully enforceable thereafter in accordance with the terms of this Agreement.  If it is determined by a court of competent jurisdiction that any restriction in this Section 2 is excessive in duration or scope or is unreasonable or unenforceable under applicable law, it is the intention of the parties that such restriction may be modified or amended by the court to render it enforceable to the maximum extent permitted by applicable law.

 

3.             TERMINATION OF PRIOR AGREEMENTS.  This Agreement constitutes the entire agreement between the parties and, as of the Effective Date, terminates and supersedes any and all prior agreements and understandings (whether written or oral) between the parties with respect to the subject matter of this Agreement.  Executive acknowledges and agrees that neither the Company nor anyone acting on its behalf has made, and is not making, and in executing this Agreement, Executive has not relied upon, any representations, promises or inducements except to the extent the same is expressly set forth in this Agreement.  Executive hereby represents and warrants to the Company that Executive is not party to any contract, understanding, agreement or policy, whether or not written, with Executive’s most-recent employer before the Company (the “Previous Employer”) or otherwise, that would be breached by Executive’s entering into, or

 

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performing services under, this Agreement.  Executive further represents that, prior to the Effective Date, (i) he has disclosed in writing to the Company all material existing, pending or threatened claims against him, if any, as a result of his employment with the Previous Employer or his membership on any boards of directors and (ii) no breach by Executive of any of his covenants in Section 2 of the Standard Terms and Conditions of the Previous Employment Agreement has occurred.

 

4.             ASSIGNMENT; SUCCESSORS.  This Agreement is personal in its nature and none of the parties hereto shall, without the consent of the others, assign or transfer this Agreement or any rights or obligations hereunder; provided, that the Company may assign this Agreement to, or allow any of its obligations to be fulfilled by, or take actions through, any affiliate of the Company and, in the event of the merger, consolidation, transfer, or sale of all or substantially all of the assets of the Company (a “Transaction”) with or to any other individual or entity, this Agreement shall, subject to the provisions hereof, be binding upon and inure to the benefit of such successor and such successor shall discharge and perform all the promises, covenants, duties, and obligations of the Company hereunder, and in the event of any such assignment or Transaction, all references herein to the “Company” shall refer to the Company’s assignee or successor hereunder.

 

5.             WITHHOLDING.  The Company shall make such deductions and withhold such amounts from each payment and benefit made or provided to Executive hereunder, as may be required from time to time by applicable law, governmental regulation or order.

 

6.             SECTION 409A OF THE INTERNAL REVENUE CODE.

 

(a)           This Agreement is not intended to constitute a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, and the rules and regulations issued thereunder (“Section 409A”).  It is intended that any amounts payable under this Agreement and the Company’s and Executive’s exercise of authority or discretion hereunder shall comply with and avoid the imputation of any tax, penalty or interest under Section 409A of the Code.  This Agreement shall be construed and interpreted consistent with that intent.

 

(b)           For purposes of this Agreement, a “Separation from Service” occurs when Executive dies, retires or otherwise has a termination of employment with the Company that constitutes a “separation from service” within the meaning of Treasury Regulation Section 1.409A-1(h)(1), without regard to the optional alternative definitions available thereunder.

 

(c)           If Executive is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of the date of Executive’s Separation from Service, Executive shall not be entitled to any payment or benefit pursuant to clause (i) of Section 1(d) until the earlier of (i) the date which is six (6) months after his or her Separation from Service for any reason other than death, or (ii) the date of Executive’s death.  The provisions of this paragraph shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Section 409A.  Any amounts otherwise payable to Executive upon or in the six (6) month period following Executive’s Separation from Service that are not so paid by reason of this Section 6(b) shall be paid (without interest) as soon as practicable after the date that is six (6) months after

 

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Executive’s Separation from Service (or, if earlier, as soon as practicable after the date of Executive’s death).

 

(d)           To the extent that any reimbursement pursuant to this Agreement is taxable to Executive, Executive shall provide the Company with documentation of the related expenses promptly so as to facilitate the timing of the reimbursement payment contemplated by this paragraph, and any reimbursement payment due to Executive pursuant to such provision shall be paid to Executive on or before the last day of Executive’s taxable year following the taxable year in which the related expense was incurred.  Such reimbursement obligations pursuant to this Agreement are not subject to liquidation or exchange for another benefit and the amount of such benefits that Executive receives in one taxable year shall not affect the amount of such benefits that Executive receives in any other taxable year.

 

(e)           In no event shall the Company be required to pay Executive any “gross-up” or other payment with respect to any taxes or penalties imposed under Section 409A with respect to any benefit paid to Executive hereunder.  The Company agrees to take any reasonable steps requested by Executive to avoid adverse tax consequences to Executive as a result of any benefit to Executive hereunder being subject to Section 409A, provided that Executive shall, if requested, reimburse the Company for any incremental costs (other than incidental costs) associated with taking such steps.  All payments to be made upon a termination of employment under this Agreement may only be made upon a “separation from service” under Section 409A.

 

7.             HEADING REFERENCES.  Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose.  References to “this Agreement” or the use of the term “hereof” shall refer to these Standard Terms and Conditions and the Employment Agreement attached hereto, taken as a whole.

 

8.             REMEDIES FOR BREACH.  Executive expressly agrees and understands that Executive will notify the Company in writing of any alleged breach of this Agreement by the Company, and the Company will have thirty (30) days from receipt of Executive’s notice to cure any such breach.  Executive expressly agrees and understands that in the event of any termination of Executive’s employment by the Company during the Term, the Company’s contractual obligations to Executive shall be fulfilled through compliance with its obligations under Section 1 of the Standard Terms and Conditions.

 

Executive expressly agrees and understands that the remedy at law for any breach by Executive of Section 2 of the Standard Terms and Conditions will be inadequate and that damages flowing from such breach are not usually susceptible to being measured in monetary terms.  Accordingly, it is acknowledged that, upon Executive’s violation of any provision of such Section 2, the Company shall be entitled to obtain from any court of competent jurisdiction immediate injunctive relief and obtain a temporary order restraining any threatened or further breach as well as an equitable accounting of all profits or benefits arising out of such violation.  Nothing in this Agreement shall be deemed to limit the Company’s remedies at law or in equity for any breach by Executive of any of the provisions of this Agreement, including Section 2, which may be pursued by or available to the Company.

 

8

 

9.             WAIVER; MODIFICATION.  Failure to insist upon strict compliance with any of the terms, covenants, or conditions hereof shall not be deemed a waiver of such term, covenant, or condition, nor shall any waiver or relinquishment of, or failure to insist upon strict compliance with, any right or power hereunder at any one or more times be deemed a waiver or relinquishment of such right or power at any other time or times.  This Agreement shall not be modified in any respect except by a writing executed by each party hereto.

 

10.           SEVERABILITY.  In the event that a court of competent jurisdiction determines that any portion of this Agreement is in violation of any law or public policy, only the portions of this Agreement that violate such law or public policy shall be stricken.  All portions of this Agreement that do not violate any statute or public policy shall continue in full force and effect.  Further, any court order striking any portion of this Agreement shall modify the stricken terms as narrowly as possible to give as much effect as possible to the intentions of the parties under this Agreement.

 

[The Signature Page Follows]

 

9

 

	
ACKNOWLEDGED   AND AGREED:
    	
 
    
	
 
    	
 
    
	
Date:   February 7, 2012
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
IAC/INTERACTIVECORP
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Gregg Winiarski
    
	
 
    	
By:
    	
Gregg   Winiarski
    
	
 
    	
Title:
    	
Senior   Vice President, General Counsel and Secretary
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Jeffrey W. Kip
    
	
 
    	
JEFFREY   W. KIPQuickLinks
 -- Click here to rapidly navigate through this document

 
 

  EXHIBIT 10.2    
    

 
 

  EXECUTIVE EMPLOYMENT AGREEMENT    
    

        This Executive Employment Agreement ("Agreement") is made effective as of March 26, 2012 ("Effective Date"), by and between
DTS, Inc. ("Company") and Kris Graves ("Executive") with respect to the following facts: 

        A.    The
Company desires to retain the services of Executive as Senior Vice President, Human Resources of the Company. 

        B.    Executive
is willing to be employed by the Company on the terms and subject to the conditions set forth in this Agreement. 

        THEREFORE,
in consideration of the promises and mutual agreements hereinafter set forth, it is agreed by and between the undersigned as follows: 

        1.    Employment.    Company hereby employs Executive, and Executive hereby accepts such employment, upon the terms
and conditions set forth herein. 

        2.    Duties.    

        2.1    Position.    Executive shall be employed as Senior Vice President, Human Resources and shall have the duties
and responsibilities set forth in the Company's job description for the position or as otherwise assigned by Company's Chief Executive Officer ("CEO") from time to time. Executive shall perform
faithfully and diligently all duties assigned to Executive. Subject to Section 7.3, Company reserves the right to modify Executive's duties at any time in its sole and absolute discretion
provided that the duties assigned are consistent with the position of Senior Vice President, Human Resources. 

        2.2    Best Efforts/Full-time.    Executive will expend Executive's best efforts on behalf of Company, and
will abide by all policies and decisions made by Company, as well as all applicable federal, state and local laws, regulations or ordinances. Executive will act in the best interest of Company at all
times. Executive shall devote Executive's full business time and efforts to the performance of Executive's assigned duties for Company, unless Executive notifies CEO in advance of Executive's intent
to engage in other paid work and receives the CEO's express written consent to do so. 

        2.3    Work Location.    Executive's principal place of work shall be located in Calabasas, California, or such other
location as Company may direct from time to time, subject to Section 7.3. 

        3.    Term.    

        3.1    Initial Term.    The Agreement shall be for an initial term commencing on the Effective Date set forth above
and continuing for a period of three (3) years following such date ("Initial Term"). 

        3.2    Renewal.    On expiration of the Initial Term specified in subsection 3.1 above, this Agreement will
automatically renew for subsequent one year terms ("Renewal Terms") unless Company provides Executive with advance written notice of its intent not to renew at least 180 days prior to the
scheduled expiration date. In the event Company gives notice of nonrenewal pursuant to this subsection 3.2, this Agreement will (a) expire at the end of the then current term and
(b) provided that Executive continues to fulfill his duties set forth in this Agreement in all material respects prior to expiration, Executive shall (x) be paid six (6) months of
Executive's Base Salary then in effect on the date of expiration and (y) receive up to six (6) months of senior executive level outplacement services paid by the Company provided,
however, that no cash payment will be made to Executive in lieu of such services . 

        3.3   Both
the Initial Term or any subsequent Renewal Terms may be earlier terminated in accordance with section 7 below. 

        4.    Compensation.    

        4.1    Base Salary.    As compensation for Executive's performance of Executive's duties hereunder, Company shall pay
to Executive a Base Salary of Two Hundred Fifty Five Thousand dollars per year ($255,000.00), payable in accordance with the normal payroll practices of Company, less required deductions for state and
federal withholding tax, social security and all other employment taxes and payroll deductions. In the event Executive's employment under this Agreement is terminated by either party, for any reason,
Executive will earn the Executives' then in effect Base Salary prorated to the date of termination. 

        4.2    Incentive Compensation.    Executive will be eligible to participate in Company's annual cash incentive
compensation plan. Executive will also be eligible to participate in any equity incentive programs established for senior executives by the Board of Directors and/or Compensation Committee. The
Company reserves the right to modify such incentive plans from time to time. 

        4.3    Performance and Salary Review.    The Company will periodically review Executive's performance and salary on no
less than an annual basis. Adjustments to salary or other compensation, if any, will be made by the Company in its sole and absolute discretion. 

        5.    Customary Fringe Benefits.    Executive will be eligible for all customary and usual fringe benefits generally
available to senior executives of Company subject to the terms and conditions of Company's benefit plan documents. Company reserves the right to change or eliminate the fringe benefits on a
prospective basis, at any time, effective upon notice to Executive. Executive will be eligible to take up to 160 hours of vacation per year and shall be credited with 160 hours of
accrued vacation at all times. 

        6.    Business Expenses.    Executive will be reimbursed promptly for all reasonable,
out-of-pocket business expenses incurred in the performance of Executive's duties on behalf of Company. To obtain reimbursement, expenses must be submitted promptly with
appropriate supporting documentation and will be reimbursed in accordance with Company's policies. Any reimbursement Executive is entitled to receive shall (a) be paid no later than the last
day of Executive's tax year following the tax year in which the expense was incurred, (b) not be affected by any other expenses that are eligible for reimbursement in any tax year and
(c) not be subject to liquidation or exchange for another benefit. 

        7.    Termination of Executive's Employment.    

        7.1    Termination for Cause by Company.    Although Company anticipates a mutually rewarding employment relationship
with Executive, Company may terminate Executive's employment immediately at any time for Cause. For purposes of this Agreement, "Cause" is defined as: (a) acts or omissions constituting
negligence, recklessness or willful misconduct on the part of Executive with respect to Executive's obligations or otherwise relating to the business of Company; (b) any acts or conduct by
Executive that are materially adverse to Company's interests; (c) Executive's material breach of this Agreement; (d) Executive's breach of Company's Proprietary Information and
Inventions Agreement; (e) Executive's conviction or entry of a plea of nolo contendere for fraud, misappropriation or embezzlement, or any felony
or crime of moral turpitude or that otherwise negatively impacts Executive's ability to effectively perform Executive's duties hereunder; (f) Executive's willful neglect of duties as determined
in the sole and exclusive discretion of the Board of Directors; (g) Executive's inability to perform the essential functions of Executive's position due to a mental or physical disability; or
(h) Executive's death. In the event of termination based on (b), (c) or (f), Executive will have fifteen (15) days from receipt of notice from Company to cure the issue, if
curable. In the event Executive's employment is terminated in accordance with this subsection 7.1, Executive shall be entitled to receive only Executive's Base Salary then in effect, prorated
to the date of termination and all benefits accrued through the date of termination, including any vested equity compensation awards ("Accrued Benefits"). All other Company obligations to Executive
pursuant to this Agreement will become automatically terminated and completely extinguished. In the event of Executive's termination of employment by 

the
Company for Cause, Executive will not be entitled to receive the Severance Package described in subsection 7.2 below. 

        7.2    Termination by Company without Cause or a Forced Relocation after a Change in Control/Severance.    Company
may terminate Executive's employment under this Agreement without Cause at any time. In the event of Termination without Cause, Executive will receive Executive's Base Salary then in effect, prorated
to the date of termination, and Accrued Benefits. In addition, Executive will receive a "Severance Package" that shall include (a) a "Severance Payment" equivalent to nine (9) months of
Executive's Base Salary then in effect on the date of termination, payable in a lump sum 60 days following the termination date; (b) payment by Company of the premiums required to
continue Executive's group health care coverage for a period of nine (9) months following Executive's termination, under the applicable provisions of the Consolidated Omnibus Budget
Reconciliation Act ("COBRA"), provided that Executive elects to continue and remains eligible for these benefits under COBRA, and does not become eligible for health coverage through another employer
during this period; (c) full acceleration of vesting of Executive's then outstanding stock options, and an extension of the exercise period of Executive's stock options or stock appreciation
rights grants until the earlier of
(i) three (3) years from the date of Executive's termination, or (ii) the remaining life of the equity grants; and (d) six (6) months of senior executive
outplacement services provided by an outplacement vendor selected by Company, provided, however, that no cash payment will be made to Executive in lieu of such services. In no event will Executive
receive a Severance Package unless Executive: (x) complies with all surviving provisions of this Agreement as specified in subsection 12.9 below; (y) executes a full, unilateral,
general release of all claims, known or unknown, that Executive may have against Company arising out of or any way related to Executive's employment or termination of employment with Company (in a
form substantially similar to that attached as Exhibit A), and such release has become effective in accordance with its terms prior to the 60th day following the termination date and
(z) agrees as part of the release agreement to not make any voluntary statements, written or oral, or cause or encourage others to make any such statements that defame, disparage or in any way
criticize the personal and/or business reputations, practices or conduct of Company ((x)-(z) are collectively referred to as "Severance Conditions"). All other Company obligations to Executive will be
automatically terminated and completely extinguished. 

        In
the event of Executive's voluntary resigns due to a Forced Relocation after a Change of Control, Executive will: (1) receive Executive's Base Salary then in effect, prorated to
the date of termination, (2) Accrued Benefits, (3) the Severance Package (as defined and subjected to the Severance Conditions set forth above), (4) full acceleration of vesting
of Executive's then outstanding restricted stock units or equity awards with performance based vesting subject to the applicable documents governing such awards, and (5) an extension of the
exercise period of Executive's stock options or stock appreciation rights grants until the earlier of (i) three (3) years from the date of Executive's termination, or (ii) the
remaining life of the equity grants. All other Company obligations to Executive will be automatically terminated and completely extinguished. 

        A
"Change of Control" is defined as any one of the following occurrences: (i) any person or entity, including a "group" as contemplated by Section 13(d)(3) of the Exchange
Act, acquires securities holding 30% or more of the total combined voting power or value of the Company, (ii) a merger or consolidation in which the Company is not the surviving corporation
(other than a merger or consolidation with a wholly-owned subsidiary, a reincorporation of the Company in a different jurisdiction, or other transaction in which there is no substantial change in the
stockholders of the Company or their relative stock holdings, or (iii) as a result of or in connection with a contested election of Company Directors, the persons who were Company Directors
immediately before the election cease to constitute a majority of the Board of Directors. 

        A
"Forced Relocation" is defined as the non-voluntary relocation of Executive's principal place of employment, post a Change in Control (as defined above) to a location more
than 30 miles from the Executive's principal place of employment immediately prior to a Change in Control requiring Executive to be based anywhere other than such principal place of employment 

(or
permitted relocation thereof) except for required travel on the Company's business to an extent substantially consistent with Executive's present business travel obligations. 

        7.3    Voluntary Resignation by Executive.    Executive may voluntarily resign Executive's position with Company at
any time on thirty (30) days' advance written notice. In the event of Executive's resignation, Executive will be entitled to receive only Executive's Base Salary and Accrued Benefits through
the thirty-day notice period and no other amount. All other Company obligations to Executive pursuant to this Agreement will become automatically terminated and completely extinguished. In
addition, Executive will not be entitled to receive the Severance Package described in subsection 7.2 above. 

        7.4    Pay in Lieu of Notice Period.    Should Executive resign Executive's employment upon thirty (30) days'
advance written notice in accordance with subsection 7.3 above, Company reserves the right to immediately relieve Executive of all job duties, positions and responsibilities and provide
Executive with payment of Executive's then current Base Salary in lieu of any portion of the notice period. 

        7.5    Resignation of Board or Other Positions.    Should Executive's employment terminate for any reason, Executive
agrees to immediately resign all other positions (including board membership) Executive may hold on behalf of Company. 

        7.6    Termination of Employment Upon Nonrenewal.    In the event Company decides not to renew this Agreement for a
subsequent one year term in accordance with subsection 3.2 above, this Agreement will expire, Executive's employment with Company will terminate and Executive will only be entitled to
Executive's Base Salary and Accrued Benefits through the last day of the current term, together with any payments required under Section 3.2. All other Company obligations to Executive pursuant
to this Agreement will become automatically terminated and completely extinguished. Executive will not be entitled to receive the Severance Package described in subsection 7.2 above. 

        7.7    Application of Section 409A.    

        (a)   Notwithstanding
anything set forth in this Agreement to the contrary, no amount payable pursuant to this Agreement which constitutes a "deferral of compensation" within
the meaning of the Treasury Regulations issued pursuant to Section 409A of the Code (the "Section 409A Regulations") shall be paid
unless and until Executive has incurred a "separation from service" within the meaning of the Section 409A Regulations. Furthermore, to the extent that Executive is a "specified employee"
within the meaning of the Section 409A Regulations as of the date of Executive's separation from service, no amount that constitutes a deferral of compensation which is payable on account of
Executive's separation from service shall be paid to Executive before the date (the "Delayed Payment Date") which is first day of the seventh month after the date of Executive's separation from
service or, if earlier, the date of Executive's death following such separation from service. All such amounts that would, but for this Section, become payable prior to the Delayed Payment Date will
be accumulated and paid on the Delayed Payment Date. 

        (b)   Company
intends that income provided to Executive pursuant to this Agreement will not be subject to taxation under Section 409A of the Code. The provisions of
this Agreement shall be interpreted and construed in favor of satisfying any applicable requirements of Section 409A of the Code. However, Company does not guarantee any
particular tax effect for income provided to Executive pursuant to this Agreement. In any event, except for Company's responsibility to withhold applicable income and
employment taxes from compensation paid or provided to Executive, Company shall not be responsible for the payment of any applicable taxes on compensation paid or provided to Executive pursuant to
this Agreement. 

        (c)   Notwithstanding
anything herein to the contrary, the reimbursement of expenses or in-kind benefits provided pursuant to this Agreement shall be subject to
the following conditions: (1) the expenses eligible for reimbursement or in-kind benefits in one taxable year shall not affect the expenses eligible for reimbursement or
in-kind benefits in any other taxable year; (2) the 

reimbursement
of eligible expenses or in-kind benefits shall be made promptly, subject to Company's applicable policies, but in no event later than the end of the year after the year in
which such expense was incurred; and (3) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit. 

        (d)   For
purposes of Section 409A of the Code, the right to a series of installment payments under this Agreement shall be treated as a right to a series of separate
payments. 

        8.    No Conflict of Interest.    During the term of Executive's employment with Company, Executive must not engage in
any work, paid or unpaid, or other activities that create a conflict of interest which materially and substantially disrupt the operations of Company. Such work and/or activities shall include, but is
not limited to, directly or indirectly competing with Company in any way, or acting as an officer, director, employee, consultant, stockholder, volunteer, lender, or agent of any business enterprise
of the same nature as, or which is in direct competition with, the business in which Company is now engaged or in which Company becomes engaged during the term of Executive's employment with Company,
as may be determined by the Board of Directors in its sole discretion. If the Board of Directors believes such a conflict exists during the term of this Agreement, the Board of Directors may ask
Executive to choose to discontinue the other work and/or activities or resign employment with Company. 

        9.    Confidentiality and Proprietary Rights.    As a condition of continuing employment, Executive agrees to read,
sign and abide by Company's Proprietary Information and Inventions Agreement, which is provided with this Agreement and incorporated herein by reference. 

        10.    Nonsolicitation of Company's Employees.    Executive agrees that during the term of this Agreement and for a
period of one (1) year after the termination of this Agreement, Executive will not, either directly or indirectly, separately or in association with others, interfere with, impair, disrupt or
damage Company's business by soliciting, encouraging or recruiting any of Company's employees or causing others to solicit or encourage any of Company's employees to discontinue their employment with
Company. 

        11.    Injunctive Relief.    Executive acknowledges that Executive's breach of the covenants contained in
sections 8-10 (collectively "Covenants") would cause irreparable injury to Company and agrees that in the event of any such breach, Company shall be entitled to seek temporary,
preliminary and permanent injunctive relief, without the necessity of proving actual damages or posting any bond or other security. 

        12.    General Provisions.    

        12.1    Successors and Assigns.    The rights and obligations of Company under this Agreement shall inure to the
benefit of and shall be binding upon the successors and assigns of Company. Executive shall not be entitled to assign any of Executive's rights or obligations under this Agreement. 

        12.2    Waiver.    Either party's failure to enforce any provision of this Agreement shall not in any way be construed
as a waiver of any such provision, or prevent that party thereafter from enforcing each and every other provision of this Agreement. 

        12.3    Attorneys' Fees.    Each side will bear its own attorneys' fees in any dispute unless a statutory section at
issue, if any, authorizes the award of attorneys' fees to the prevailing party. 

        12.4    Severability.    In the event any provision of this Agreement is found to be unenforceable by an arbitrator or
court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall
receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision
shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby. 

        12.5    Interpretation; Construction.    The headings set forth in this Agreement are for convenience only and shall
not be used in interpreting this Agreement. This Agreement has been drafted by legal counsel representing Company, but Executive has participated in the negotiation of its terms. Furthermore,
Executive acknowledges that Executive has had an opportunity to review and revise the Agreement and have it reviewed by legal counsel, if desired, and, therefore, the normal rule of construction to
the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement. 

        12.6    Governing Law.    This Agreement will be governed by and construed in accordance with the laws of the United
States and the State of California. 

        12.7    Arbitration.    Executive and the Company agree that any dispute arising under or in connection with this
Agreement, including any dispute involving Executive's employment or the termination of that employment (whether based on contract, tort or statutory duty or prohibition, including any prohibition
against discrimination or harassment), shall be submitted to binding arbitration in accordance with California Code of Civil Procedure
§§ 1280 - 1294.2 before a single neutral arbitrator. Executive and the Company understand that each is waiving its rights to a jury trial. The
party demanding arbitration shall submit a written claim to the other party setting out the basis of the claim. Demands shall be presented in the same manner as notices under this Agreement. Executive
and the Company will attempt to reach agreement on an arbitrator within ten (10) business days of delivery of the arbitration demand. After this ten (10) business day period, either
Executive or the Company may request a list of seven professional arbitrators from the American Arbitration Association or another mutually agreed service. Executive and the Company will alternately
strike names until only one person remains and that person shall be designated as the arbitrator. The party demanding arbitration shall make the first strike. The arbitration shall take place in or
within five miles of Calabasas, California, at a time and place determined by the arbitrator. Each party shall be entitled to discovery of essential documents and witnesses and to deposition
discovery, as determined by the arbitrator, taking into account the mutual desire to have a fast, cost-effective, dispute-resolution mechanism. Executive and the Company will attempt to
cooperate in the discovery process before seeking the determination of the arbitrator. Except as otherwise determined by the arbitrator, Executive and the Company will each be limited to no more than
three (3) depositions. The
arbitrator shall have the powers provided in California Code of Civil Procedure §§ 1282.2 - 1284.2 and may provide all appropriate remedies at
law or equity. The arbitrator will have the authority to entertain a motion to dismiss and/or a motion for summary judgment by either Executive or the Company and shall apply the standards governing
such motions under California law. The Arbitrator shall render, within sixty (60) days of the completion of the arbitration, an award and a written, reasoned opinion in support of that award.
Judgment on the award may be entered in any court having jurisdiction. The Company and Executive will each pay one-half of (a) the arbitrator's expenses and fees and (b) all
meeting room charges. Unless otherwise ordered by the arbitrator pursuant to law or this Agreement, each party shall pay its own attorney fees, witness fees and other expenses incurred by the party
for his or her own benefit. 

        12.8    Notices.    Any notice required or permitted by this Agreement shall be in writing and shall be delivered as
follows with notice deemed given as indicated: (a) by personal delivery when delivered personally; (b) by overnight courier upon written verification of receipt; (c) by telecopy
or facsimile transmission upon acknowledgment of receipt of electronic transmission; or (d) by certified or registered mail, return receipt requested, upon verification of receipt. Notice shall
be sent to the addresses set forth below, or such other address as either party may specify in writing. 

        12.9    Survival.    Sections 8 ("No Conflict of Interest"), 9 ("Confidentiality and Proprietary Rights"), 10
("Nonsolicitation"), 11 ("Injunctive Relief"), 12 ("General Provisions") and 13 ("Entire Agreement") of this Agreement shall survive Executive's employment by Company. 

        13.    Entire Agreement.    This Agreement, including the Proprietary Information and Inventions Agreement
incorporated herein by reference, constitutes the entire agreement between the parties 

relating
to this subject matter and supersedes all prior or simultaneous representations, discussions, negotiations, and agreements, whether written or oral. This agreement may be amended or modified
only with the written consent of Executive and the Board of Directors of Company. No oral waiver, amendment or modification will be effective under any circumstances whatsoever. 

THE
PARTIES TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES HAVE EXECUTED THIS AGREEMENT ON THE DATES SHOWN
BELOW. 

 

									
	Dated:	 	3/8/12

 	 	 	 	/s/ JON KIRCHNER  

  Jon Kirchner

Chairman of the Board of Directors &

Chief Executive Officer

DTS, Inc.
	

 	
 	

 	
 	

 	
 	

 	
 	

 
	Dated:	 	3/1/12

 	 	 	 	By:	 	/s/ KRIS GRAVES  

  Kris Graves

535 Nobletree Court

Oak Park, CA 91377

 

 

 
 

  Exhibit A    
    

        1.    General Release by Employee.    Employee unconditionally, irrevocably and absolutely releases and discharges
Company, and any parent and subsidiary corporations, divisions and affiliated corporations, partnerships or other affiliated entities of Company, past and present, as well as Company's employees,
officers, directors, agents, successors and assigns (collectively, "Released Parties"), from all claims related in any way to the transactions or occurrences between them to date, to the fullest
extent permitted by law, including, but not limited to, Employee's employment with Company, the termination of Employee's employment, and all other losses, liabilities, claims, charges, demands and
causes of action, known or unknown, suspected or unsuspected, arising directly or indirectly out of or in any way connected with Employee's employment with Company. This release is intended to have
the broadest possible application and includes, but is not limited to, any tort, contract, common law, constitutional or other statutory claims arising under local state or federal law, including, but
not limited to alleged violations of the California Labor Code, the California Fair Employment and Housing Act, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, and the
Age Discrimination in Employment Act of 1967, as amended, and all claims for attorneys' fees, costs and expenses. Employee expressly waives Employee's right to recovery of any type, including damages
or reinstatement, in any administrative or court action, whether state or federal, and whether brought by Employee or on Employee's behalf, related in any way to the matters released herein. However,
this general release is not intended to bar any claims that, by statute, may not be waived, such as claims for workers' compensation benefits, unemployment insurance benefits, statutory indemnity, any
challenge to the validity of Employee's release of claims under the Age Discrimination in Employment Act of 1967, as amended, as set forth in this Separation Agreement; any claims for payment or
benefits under the Separation Agreement; any claim or cause of action for indemnification pursuant to any applicable indemnification agreement, any D&O insurance policy applicable to Executive and/or
Company's certificates of incorporation, charter and by-laws or any claim for contribution or any rights Executive may have to vested benefits under any health and welfare plans or other
employee benefit plans or programs sponsored by the Company. 

Employee
acknowledges that Employee may discover facts or law different from, or in addition to, the facts or law that Employee knows or believes to be true with respect to the claims released in this
Separation Agreement and agrees, nonetheless, that this Separation Agreement and the release
contained in it shall be and remain effective in all respects notwithstanding such different or additional facts or the discovery of them. 

Employee
declares and represents that Employee intends this Separation Agreement to be complete and not subject to any claim of mistake, and that the release herein expresses a full and complete
release and Employee intends the release herein to be final and complete. Employee executes this release with the full knowledge that this release covers all possible claims against the Released
Parties, to the fullest extent permitted by law. 

        2.    California Civil Code Section 1542 Waiver.    Employee expressly acknowledges and agrees that all rights
under Section 1542 of the California Civil Code are expressly waived. That section provides: 

A
GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE
MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. 

        3.    Representation Concerning Filing of Legal Actions.    Employee represents that, as of the date of this
Separation Agreement, Employee has not filed any lawsuits, charges, complaints, petitions, claims or other accusatory pleadings against Company or any of the other Released Parties in any court or
with any governmental agency. 

        4.    Nondisparagement.    Employee agrees that Employee will not make any voluntary statements, written or oral, or
cause or encourage others to make any such statements that defame, disparage or in any way criticize the personal and/or business reputations, practices or conduct of Company or any of 

the
other Released Parties. Company agrees that Company, will direct its officers and directors not to make any voluntary statements, written or oral, or cause or encourage others to make any such
statements that defame, disparage or in any way criticize the personal and/or business reputation, practices or conduct of Executive. 

        5.    Confidentiality and Return of Company Property.    Employee understands and agrees that as a condition of
receiving the Severance Package, all Company property must be returned to Company on or before the Separation Date. By signing this Separation Agreement, Employee represents and warrants that
Employee has returned to Company on or before the Separation Date, all Company property, data and information belonging to Company and agrees that Employee will not use or disclose to others any
confidential or proprietary information of Company or the Released Parties. In addition, Employee agrees to keep the terms of this Separation Agreement confidential between Employee and Company,
except that Employee may tell Employee's immediate family and attorney or accountant, if any, as needed, but in no event should Employee discuss this Separation Agreement or its terms with any current
or prospective employee of Company. 

        6.    Continuing Obligations.    Employee further agrees to comply with the continuing obligations regarding
confidentiality set forth in the surviving provisions of Company's Proprietary Information and Inventions Agreement previously signed by Employee. 

        7.    No Admissions.    By entering into this Separation Agreement, the Released Parties make no admission that they
have engaged, or are now engaging, in any unlawful conduct. The parties understand and acknowledge that this Separation Agreement is not an admission of liability and shall not be used or construed as
such in any legal or administrative proceeding. 

        8.    Older Workers' Benefit Protection Act.    This Separation Agreement is intended to satisfy the requirements of
the Older Workers' Benefit Protection Act, 29 U.S.C. sec. 626(f). Employee is advised to consult with an attorney before executing this Separation Agreement. 

        8.1    Acknowledgments/Time to Consider.    Employee acknowledges and agrees that (a) Employee has read and
understands the terms of this Separation Agreement; (b) Employee has been advised in writing to consult with an attorney before executing this Separation Agreement; (c) Employee has
obtained and considered such legal counsel as Employee deems necessary; (d) Employee has been given twenty-one (21) days to consider whether or not to enter into this
Separation Agreement (although Employee may elect not to use the full 21-day period at Employee's option); and (e) by signing this Separation Agreement, Employee acknowledges that
Employee does so freely, knowingly, and voluntarily. 

        8.2    Revocation/Effective Date.    This Separation Agreement shall not become effective or enforceable until the
eighth day after Employee signs this Separation Agreement. In other words, Employee may revoke Employee's acceptance of this Separation Agreement within seven (7) days after the date Employee
signs it. Employee's revocation must be in writing and received by DTS, Inc. on or before the seventh day in order to be effective. If Employee does not revoke acceptance within the seven
(7) day period, Employee's acceptance of this Separation Agreement shall become binding and enforceable on the eighth day ("Effective Date"). The Severance Package will become due and payable
after the Effective Date, provided Employee does not revoke. 

        8.3    Preserved Rights of Employee.    This Separation Agreement does not waive or release any rights or claims that
Employee may have under the Age Discrimination in Employment Act that arise after the execution of this Separation Agreement. In addition, this Agreement does not prohibit Employee from
challenging the validity of this Separation Agreement's waiver and release of claims under the Age Discrimination in Employment Act of 1967, as amended. 

        9.    Severability.    In the event any provision of this Separation Agreement shall be found unenforceable, the
unenforceable provision shall be deemed deleted and the validity and enforceability of the remaining provisions shall not be affected thereby. 

        10.    Full Defense.    This Separation Agreement may be pled as a full and complete defense to, and may be used as a
basis for an injunction against, any action, suit or other proceeding that may be prosecuted, instituted or attempted by Employee in breach hereof. 

        11.    Applicable Law.    The validity, interpretation and performance of this Separation Agreement shall be construed
and interpreted according to the laws of the United States of America and the State of California. 

        12.    Entire Agreement; Modification.    This Separation Agreement, including the surviving provisions of Company's
Proprietary Information and Invention Agreement previously executed by Employee, is intended to be the entire agreement between the parties and supersedes and cancels any and all other and prior
agreements, written or oral, between the parties regarding this subject matter. This Separation Agreement may be amended only by a written instrument executed by all parties hereto. 

QuickLinks

EXHIBIT 10.2

EXECUTIVE EMPLOYMENT AGREEMENT

Exhibit A

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