Document:

Exhibit

Exhibit 10.1
SETTLEMENT AGREEMENT
This Settlement Agreement (“Agreement”) is entered into as of January 26, 2016, (the “Effective Date”) by and between Overstock.com, Inc., Keith Carpenter, Olivier Chang, Fern Bailey and Wendy Mather, as Co-Personal Representatives of the Estate of Mary Helburn, Elizabeth Foster, Hugh D. Barron, David Trent and Mark Montag, on the one hand (collectively the “Overstock Parties”), and Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Pierce”) and Merrill Lynch Professional Clearing Corporation (“Merrill Pro”), on the other hand (collectively the “Merrill Parties”).  The Overstock Parties and the Merrill Parties are referred to collectively herein as the “Settling Parties.”  
RECITALS
A.Whereas, on or about February 2, 2007, the Overstock Parties filed a lawsuit, captioned Overstock.com, Inc. et al. v. Morgan Stanley & Co., Incorporated et al., Case No. CGC-07-460147 in the Superior Court of California for the County of San Francisco (the “Action”) in which the Overstock Parties asserted claims for, among other things, alleged violations of California Corporations Code Sections 25400 and 25500, California Business & Professions Code Sections 17200 and 17500, et seq., and New Jersey’s RICO statute;
B.Whereas judgment was entered in favor of the Merrill Parties in the Action on or about April 12, 2012, including for costs;
C.Whereas on November 13, 2014, the California Court of Appeal issued two decisions ruling on appeals from the Action, Court of Appeal No. A135682 (the “Main Appeal”) and Court of Appeal Case Nos. A133487 and A135180 (the “Sealing Appeal”), in which judgment was affirmed as to Merrill Pierce and reversed as to Merrill Pro on the Overstock Parties’ claim for violations of California Corporations Code Sections 25400 and 25500;

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D.Whereas Merrill Pro is thus the sole remaining defendant in the Action and Merrill Pierce was a former defendant in the Action;
E.Whereas, on remand, the Overstock Parties and Merrill Pro continue to litigate the claim for violations of California Corporations Code Sections 25400 and 25500, and the Overstock Parties and Merrill Pierce dispute if, and in what amount, Merrill Pierce should be awarded its costs of the Action;
F.Whereas, in order to avoid the additional expenditure of time, money, and resources, the Parties desire to compromise and resolve fully and settle the Action and all disputed matters between them and have agreed to do so on the terms and conditions set forth in this Agreement;  
NOW, THEREFORE, in consideration of the mutual promises, obligations, and covenants set forth in this Agreement, the Parties agree as follows:
SETTLEMENT TERMS
1.Payment.   The Merrill Parties agree to pay $20,000,000 ($20 million) to Overstock.com, Inc. (the Settling Parties understand that the allocation of the Payment among the Overstock Parties is set forth in a separate agreement among the Overstock Parties).  Specifically, after receiving executed copies of the Agreement from each of the Overstock Parties and appropriate W-9(s) and wiring instructions, the Merrill Parties will (a) immediately provide an executed copy of the Agreement and (b) within ten (10) business days cause the $20 million to be wired to Lubin Olson & Niewiadomski LLP.    
2.Dismissals with Prejudice.  Within two (2) business days of receipt of the Payment set forth in Paragraph 1, the Overstock Parties shall dismiss with prejudice the Action and all of their claims therein.  These dismissals shall result in the dismissal with prejudice of the entire Action.  

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3.Mutual Waiver of Costs.  The Settling Parties agree to bear their own costs and to waive any and all claims to costs, expenses, or fees that arise out of or relate to the Action, including but not limited to any and all costs previously awarded to Merrill Pierce.
4.Non-Opposition to Motion to Seal.  The Merrill Parties agree that they will not continue their opposition to Plaintiffs’ Motion to Seal Materials Submitted with Defendants’ Oppositions to Plaintiffs’ Motions to Tax filed on or about January 29, 2013, as well as any other motions to seal related to this Action.  The Merrill Parties further agree to file a timely Statement of Non-Opposition in the form attached hereto as Exhibit A.
5.Press Release.  Overstock will issue a press release concerning this settlement in the form attached hereto as Exhibit B.     
6.Mutual Releases.  
a.    Release of Merrill Parties.  Except as to the obligations created by this Agreement, including the $20 million payment, the Overstock Parties, on behalf of themselves and each of their past, present and future corporate parents, subsidiaries, affiliates, partners, predecessors, and successors and their respective licensees, assigns, attorneys, insurers, officers, directors, representatives, shareholders controlled by the Overstock Parties, employees, agents, trusts, beneficiaries, estates, heirs, executors, and administrators (collectively, the “Overstock Releasors”), do hereby release, remise, discharge, and forever acquit the Merrill Parties, including their past, present, and future corporate parents, subsidiaries, affiliates, predecessors, and successors and their respective trusts, beneficiaries, estates, heirs, executors, administrators, licensees, assigns, principals, representatives, insurers, agents, attorneys, employees, partners, officers, and directors (collectively, the “Merrill Releasees”), from any and all claims, demands, liabilities, damages, causes of action, costs, expenses, and compensation of any kind or nature whatsoever, including without limitation claims for sanctions and claims for attorneys’ fees, whether known or unknown, suspected or unsuspected, claimed or unclaimed, liquidated or unliquidated, matured or unmatured, fixed or contingent, that the Overstock Releasors now have, could have claimed, 

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have claimed, or may claim to have against the Merrill Releasees, relating to, arising out of, or in any way involving the Action or any claims therein, all claims that were or could have been raised in the Action, and any purchase, holding, sale, pricing, clearance, or settlement of, or other transaction in, Overstock.com, Inc. securities, bonds, options, or derivatives (collectively, “Overstock Securities”), short sales or short selling of Overstock Securities, lending of Overstock Securities, failures to deliver or receive Overstock Securities, or the facilitation or brokering of such transactions or activities, or any other conduct to which the claims in the complaints in the Action are related, from the history of the world to the date hereof.
b.    Release of Overstock Parties.  Except as to the obligations created by this Agreement, the Merrill Parties, on behalf of their past, present and future corporate parents, subsidiaries, affiliates, predecessors, and successors and their respective representatives, agents, attorneys, estates, heirs, executors, administrators, licensees, and assigns (collectively, the “Merrill Releasors”) do hereby release, remise, discharge, and forever acquit the Overstock Parties, including their past, present and future corporate parents, subsidiaries, affiliates, predecessors, and successors and their respective trusts, beneficiaries, estates, heirs, executors, administrators, licensees, assigns, principals, representatives, insurers, agents, attorneys, current employees, partners, officers, and directors (collectively, the “Overstock Releasees”), from any and all claims, demands, liabilities, damages, causes of action, costs expenses, and compensation, including claims for sanctions and claims for attorneys’ fees, whether known or unknown, suspected or unsuspected, claimed or unclaimed, liquidated or unliquidated, matured or unmatured, fixed or contingent, that the Merrill Releasors now have, could have claimed, have claimed, or may claim to have against the Overstock Releasees relating to, arising out of, or in any way involving the Action or any claims therein, including without limitation any allegedly improper or inappropriate institution, prosecution, or settlement of the Action.
c.    Mutual Waiver of Section 1542.  The Settling Parties expressly waive and relinquish all rights and benefits afforded to them by section 1542 of the Civil Code of the State of 

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California (“Section 1542”), and all rights and benefits conferred by any law of any state or territory of the United States or principle of common law that is similar, comparable, or equivalent to Section 1542, and do so understanding and acknowledging the significance and consequence of such specific waiver of Section 1542.  Section 1542 states as follows:

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.

Each of the Settling Parties warrants that it has read this Agreement, including this waiver of Section 1542, and that each of them has had the opportunity to consult counsel about the Agreement and specifically about the waiver of Section 1542, and each of them understands the Agreement and the Section 1542 waiver and freely and knowingly enters into this Agreement.  The Settling Parties acknowledge that they may hereafter discover facts different from or in addition to those they know or now believe to be true with respect to the matters released or described in this Agreement, and they agree to the releases and agreements notwithstanding any later discovery of any such different or additional facts.  The Settling Parties hereby assume any and all risk of any mistake in connection with the true facts involved in the matters, disputes, or controversies described in this Agreement or with regard to any facts which are now unknown to them.  
GENERAL PROVISIONS
7.Warranty of Reliance Solely on this Agreement As Written.  None of the Settling Parties is entering into this Agreement in reliance upon any express or implied representation, agreement, or understanding of any kind, except as to representations contained in this Agreement.
8.No Transfer of Claims.  Each party acknowledges, represents, and warrants that, as of the date of its execution of this Agreement, it has not voluntarily or involuntarily transferred any of its claims, demands, or rights in the Lawsuit.

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9.Investigation of Facts.  Each party acknowledges, represents, and warrants as of the date of its execution of this Agreement that it has made such investigation of the facts pertaining to this Agreement as it deems necessary.
10.Representation by Counsel.  Each of the Settling Parties acknowledges that it has had the opportunity to seek advice of independent legal counsel in connection with this Agreement and that it understands the meaning of every term of this Agreement and the consequences of signing this Agreement.
11.Preparation of Agreement.  This Agreement is the product of negotiation and preparation by and among the Settling Parties and their respective attorneys.  The Settling Parties, therefore, expressly acknowledge and agree that this Agreement shall not be deemed prepared or drafted by one party or another, or its attorneys, and will be construed accordingly.
12.Integrated Agreement.  This Agreement, as now written, constitutes the final expression of the entire agreement among the Settling Parties with respect to its subject matter, and supersedes all prior, contemporaneous, oral or written agreements and discussions, if any.  This Agreement may be changed, revised, or altered only by amendment or modification in writing signed by each of the Settling Parties and signifying their agreement to such changes, revisions or alterations.
13.Parties Bound and Benefited by Agreement.  This Agreement binds the signatories to this Agreement and the persons identified herein and shall inure to their benefit to the extent permitted by law.  Except as to those persons and entities identified in this Agreement, no other person or entity shall be a direct or indirect beneficiary of or have any direct or indirect cause of action or claim in connection with this Agreement.
14.Governing Law, Jurisdiction, and Enforceability.  This Agreement shall be governed by, construed, and interpreted in accordance with the laws of the State of California without regard to its principles of conflicts of laws.  The Settling Parties agree that, pursuant to California Code of Civil Procedure section 664.6, the Superior Court of the State of California for the County of San 

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Francisco shall retain continuing and exclusive jurisdiction of this action and any and all subsequent actions arising out of or related to the interpretation or enforcement of this Agreement.  The Settling Parties agree that this Agreement is binding, enforceable, and admissible in order to enforce this Agreement.  The Settling Parties agree that exclusive jurisdiction to enforce this Agreement shall be retained by the Hon. Suzanne Ramos Bolanos of the San Francisco Superior Court, or, if for any reason Judge Bolanos is unavailable to preside, then another judge of the San Francisco Superior Court.
15.Authority.  Each person who signs this Agreement and all related agreements on behalf of a party represents and warrants that he or she has full and complete authority to execute this Agreement and all related agreements and that any necessary Board of Director resolutions, partnership votes, or other approvals have been obtained.
16.Counterparts.  This Agreement may be executed in separate counterparts, which together constitute one instrument.  This Agreement may be transmitted by facsimile or email.
17.Inability to Use this Agreement If Not Effective.  If this Agreement does not become effective for any reason, it shall be deemed negotiations for settlement purposes only and will not be admissible in evidence or usable for any purposes whatsoever. 
18.No Evidence or Admission of Liability.  This Agreement is a compromise and settlement of the Lawsuit.  The Settling Parties acknowledge that by entering into this Agreement, each party intends only to reach an amicable resolution of their differences.  This Agreement shall not be deemed to be, nor construed to be, evidence of any matter.  No party in any way admits liability to any other party or to any other person or entity. 
19.Construction.  All provisions of this Agreement are intended to be interpreted and construed in a manner to make such provisions valid, legal, and enforceable.  If any portion or term of this Agreement is held unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall not be affected and shall remain fully in force and enforceable.  The terms of this Agreement are contractual, and not merely a recital.

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20.Attorneys’ Fees.  All Settling Parties shall bear their own costs and attorneys’ fees incurred in connection with this Lawsuit.  If any action or proceeding at law or in equity is necessary to enforce or interpret the terms of this Agreement, the Settling Parties agree that the prevailing parties shall be entitled to recover attorneys’ fees and costs spent in connection with any such action or proceeding, in addition to any other relief to which said parties may be entitled.
21.Further Documentation.  The Settling Parties each understand and agree that the terms of this Agreement shall constitute a binding settlement upon all of them.  They shall do, execute and deliver, or shall cause to be done, executed, and delivered, all such further acts, documents, or instruments as shall be necessary and appropriate to carry out the purposes of this Agreement.
22.Notices.   All notices served on a party under this Agreement shall also be served on the counsel for the party listed below, or, if that counsel cannot be located, on such other counsel as is known to have represented the party during this Lawsuit.
23.No Confidentiality.  The Settling Parties agree that this Agreement is not confidential.
24.Non-Disparagement Agreement.     Overstock.com Inc. will issue a press release, in the form of Exhibit B, as referenced above in paragraph 5 of the Settlement Terms, and agrees to issue no other formal public statement concerning the Action.  In addition, the Settling Parties agree that for 24 months from the Effective Date neither they nor any of their representatives, executives, members of senior management, or anyone else acting on their behalf, shall make any public statement about the conduct or role of the Settling Parties in the Action, the claims and defenses asserted by any of the Settling Parties in the Action, any documents produced by any of the Settling Parties in the Action, or any testimony provided in the Action by an employee or former employee of any of the Settling Parties, other than repeating or summarizing some or all of the contents of the press release.  To the extent Overstock.com or its representatives wishes to make public statements regarding the topics contained in the penultimate paragraph of Exhibit B (beginning “Overstock feels the fight . . .”) it shall not be 

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constrained by this Paragraph 24 if those public statements do not reference the conduct or role of the Merrill Parties in the Action, the claims and defenses asserted by the Merrill Parties in the Action, any documents produced by the Merrill Parties in the Action, or any testimony provided in the Action by an employee or former employee of the Merrill Parties.  The Settling Parties agree that irreparable harm would result to the Merrill Parties and their affiliates on the one hand, or the Overstock Parties on the other, if any part of the covenant contained in this Paragraph 24 is not fully performed and that the relevant non-breaching party shall be entitled to an injunction or injunctions to prevent breaches of this provision or to enforce it specifically in addition to any other remedy to which that party is entitled at law or in equity.  The Settling Parties acknowledge that legal damages arising out of this covenant will not adequately compensate the other Settling Parties for the harm caused by the breach of this covenant, including due to the uncertain risks and liabilities to which such a breach could potentially expose the non-breaching party.
AGREED TO AND ACCEPTED BY:

	
					
	Dated:
	1/27/2016
	 
	OVERSTOCK.COM, INC.,

	 
	 
	 
	a Delaware corporation

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Jonathan E. Johnson III

	 
	 
	 
	Name:
	Jonathan E. Johnson

	 
	 
	 
	Title:
	Chairman

	
					
	Dated:
	 
	 
	Keith Carpenter

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Keith Carpenter

	
					
	Dated:
	1/28/2016
	 
	Olivier Cheng

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Olivier Cheng

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	Dated:
	1/27/2016
	 
	Estate of Mary Helburn

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Fern L. Bailey

	 
	 
	 
	Name:
	Fern L. Bailey

	 
	 
	 
	Title:
	Attorney-In-Fact

	
					
	Dated:
	1/27/2016
	 
	Estate of Mary Helburn

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Wendy Mather

	 
	 
	 
	Name:
	Wendy Mather

	 
	 
	 
	Title:
	Co-Executor

	
					
	Dated:
	1/28/2016
	 
	Elizabeth Foster

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Elizabeth Foster

	
					
	Dated:
	1/27/2016
	 
	Hugh D. Barron

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Hugh D. Barron

	
					
	Dated:
	1/27/2016
	 
	David Trent

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ David Trent

	
					
	Dated:
	1/27/2016
	 
	Mark Montag

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Mark Montag

	
					
	Dated:
	1/28/2016
	 
	MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Brendan Dowd

	 
	 
	 
	Name:
	Brendan Dowd

	 
	 
	 
	Title:
	Attorney-In-Fact

	
					
	Dated:
	1/28/2016
	 
	MERRILL LYNCH PROFESSIONAL CLEARING CORPORATION

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ John K. McCarthy

	 
	 
	 
	Name:
	John K. McCarthy

	 
	 
	 
	Title:
	Executive Vice President

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APPROVED AS TO FORM:

	
					
	Dated:
	1/27/2016
	 
	LUBIN OLSON & NIEWIADOMSKI LLP

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Theodore Griffinger

	 
	 
	 
	 
	Theodore Griffinger

	 
	 
	 
	 
	Attorneys for Plaintiffs

	
					
	Dated:
	1/27/2016
	 
	O’MELVENY & MYERS LLP

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Andrew Frackman

	 
	 
	 
	 
	Andrew Frackman

	 
	 
	 
	 
	Attorneys for Merrill, Lynch, Pierce, Fenner & Smith Incorporated and Merrill Lynch Professional Clearing Corporation

    

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Exhibit A

Statement of Non-Opposition

[Intentionally omitted]

Exhibit B

Press Release dated January 28, 2016

[Intentionally omitted]EX-10.1

FORM OF MIP AGREEMENT FOR EXECUTIVE OFFICERS

February 2016

[Name of Executive]

[Address]

Re: Lionbridge Technologies, Inc. 2016 Management Incentive Plan (MIP)

Dear :

I am pleased to inform you that you are invited to participate in the 2016 Lionbridge Management
Incentive Plan (“MIP”). As a participant, you are entitled to receive a cash incentive payment upon
the achievement by the Company in 2016 of the applicable following performance metrics set by the
Nominating and Compensation Committee:

Corporate-wide Revenue Target for 2016

Corporate-wide Profitability Target for 2016

Objectives related to the business or function you lead in your capacity as [title] at
Lionbridge (“MBO”)

Other Product Line Performance Objectives.

Your potential MIP award is determined based on a percent of your annual based salary (“MIP
Percentage”), and your personal MIP Percentage is set forth in Exhibit A. Exhibit A also sets out
your personal MBO (if applicable), as well as the specific Revenue and Profitability targets set by
the Nominating and Compensation Committee.

Achievement of the MIP objectives will be determined by our Compensation Committee following the
completion of the audit of our 2016 financial results. The Committee has the sole discretion in
determining achievement of all objectives, including the MBO. In addition, the Committee has sole
discretion to adjust any award to reflect the impact of foreign currency exchange rate fluctuations
or any other extraordinary events.

The term “Revenue” means the revenue as reported in the Corporation’s financial statements for the
year ending December 31, 2016. The term “Profitability” means the Corporation’s adjusted EBITDA for
the Corporation’s fiscal year ending December 31, 2016, determined as follows:

	 	 	 
	•
	 	Income from Operations, plus

	•
	 	Merger, Restructuring & other charges

	•
	 	Amortization of Acquisition Related Intangibles

	•
	 	Depreciation

	•
	 	Amortization, and

	•
	 	Stock Based Compensation Expense

To receive a payment under the MIP, you must continue to be employed by the Company in your current
position at the time payment is determined and authorized by the Compensation Committee. In
addition, your participation in the MIP is conditioned on your acknowledgement that: (a) your
participation in the MIP is voluntary; (b) participation in the MIP and any award thereunder is not
part of normal or expected compensation for any purpose, including without limitation for
calculating any benefits, severance, resignation, termination, redundancy, end of service payments,
bonuses, or similar payments; (c) neither the MIP, nor the issuance or potential issuance of award
under the MIP confers upon you any right to continue in the service of (or any other relationship
with) the Company and (d) you reconfirm your contractual and legal obligations of confidentiality
to the Company and your obligations not to compete with the Company, as such are described in your
Non-Disclosure Agreement, Non-Competition Agreement and/or Business Protection Agreement with the
Company.

You agree and understand that your participation in the MIP is conditioned on your agreement and
consent that the Board of Directors of the Company or its Nominating and Compensation Committee has
the sole discretion to require you or your estate to repay to the Company, in cash and upon demand,
any MIP award made to you (a) in the event of a restatement (other than a restatement due to a
change in accounting policies) of the Company’s financial results where the restatement results in
a material impact on the financial statements for the period affecting the achievement of the
performance conditions for the award of any portion or all of your MIP award or (b) if the Board or
the Committee determines that you have engaged in fraud or misconduct (“Misconduct”) that resulted
in or substantially resulted in the achievement of the performance conditions for the award of any
portion or all of your MIP award. The amount to be repaid shall be determined by the Committee in
its sole discretion. Any determination by the Committee with respect to the foregoing shall be
final, conclusive and binding on all interested parties. This provision expires on the earlier of
(a) a Change of Control (as defined under the Company’s Change of Control Plan) or (b) three years
from the date of grant of the MIP award.

This letter agreement is governed under the laws of the Commonwealth of Massachusetts.

Please indicate your acceptance to the terms contained in this letter agreement and participation
in the MIP by signing below and returning one copy of the letter agreement to me.

Sincerely,

Rory J. Cowan

Chief Executive Officer

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Exhibit A

MIP Percentage:

Revenue Payout Target: $     Million

Revenue Payout Thresholds (minimum and maximum):

Minimum: 87.5% of the Revenue Target

Maximum: 125% of the Revenue Target

Profitability Payout Target: $     Million

Profitability Payout Thresholds (minimum and maximum)

Minimum: 80% of the Profitability Target

Maximum: 125% of the Profitability Target

MBO:

Other Product Line Performance Metrics:

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