Exhibit 10.37
(IMMERSION LOGO) [f42365f4236501.gif]
FY2008
Executive Incentive Plan
Victor Viegas

 

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OBJECTIVES
The specific aim of the 2008 Executive Incentive Plan is to focus Immersion’s
executive management on Immersion’s revenue, operating profit, gross margin
goals and business objectives, and to reward achievement of those goals.
ELIGIBILITY
In addition to your base salary, you are eligible to earn an incentive payment
under Immersion’s 2008 Executive Incentive Plan as set out in this Plan and the
attached document titled Attachment A. In order to be eligible to receive any
payment under this Plan, you must sign and date a copy of the Plan on the space
provided below and return it to Human Resources. An executive’s eligibility to
participate in this Plan will be subject to the review and approval of the CEO
and CFO of the Company, and any payments under this Plan will be subject to the
review and approval of the Company’s CEO, which approval may be withheld in
his/her sole discretion. This Plan supersedes all prior executive bonus,
incentive, and/or variable compensation plans of the Company, which are of no
further force or effect.
Employees hired after January 1, and during the Plan Period who are permitted to
participate in the Plan shall be eligible to participate on a pro-rata basis,
based upon their start date and contingent upon continued active employment
through the date when the Bonus Plan payout occurs. The proration will be based
on the number of work days during the plan year.
PLAN ADMINISTRATION
This Plan is effective for the Company’s 2008 fiscal year. The Company may
cancel, suspend, amend, or revise all or any part of the Plan for any reason at
any time.
To the extent earned, payments hereunder will be wages and will be subject to
withholding of federal and state income and employment taxes. Earned payments
under this Plan will be paid on the next regular payroll date following the
later of (a) 45 days after the end of the fiscal year, (b) the date on which the
Company’s Income Statement for the year has been finalized, or (c) the date on
which the Company’s earnings for the year have been publicly disclosed (the
“Payment Date”).
Nothing in this Plan shall in any way alter the at-will employment relationship
between the Company and its executives. All employees of the company are
employed on an “at-will” basis, which means that either the employee or the
Company may terminate the relationship at any time, with or without cause or
notice.
For purposes of this Plan, a participant’s employment with Immersion terminates
on the last day on which work duties are actually performed by the participant.
Periods of pay in lieu of notice, severance, or any other post-termination
benefits or compensation period shall not be deemed periods of employment for
purposes of this Plan. In order to earn any payment under the Plan, a
participant must have been continuously employed by Immersion from January 1,
2008 through the Payment Date. A participant who resigns from his employment
with Immersion prior to the Payment Date, or whose employment is terminated
prior to the Payment Date, will not earn any payment under this Plan.
Provided they meet the other eligibility requirements described in this Plan,
participants who are on an approved leave of absence at any time during the 2008
fiscal year will earn a pro rated payment under this Plan based upon the portion
of the year that they are actively employed and not on leave status. To the
extent that a participant is on an approved leave of absence on the Payment
Date, he/she will not earn any payment under this Plan unless he/she returns to
active employment with Immersion, at which time he/she will receive his/her Plan
payment.

 

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PLAN DEFINITIONS
Revenue is revenue that is recognized by Immersion for the applicable period in
accordance with generally accepted accounting principles and as reported in the
Company’s audited financial statements.
Cost of Goods Sold is the direct and allocated indirect production costs of
producing goods and services.
Gross Margin (GM) is determined by subtracting the Cost of Goods Sold
(COGS) from the actual sale price of the product. The net result is the GM. GM
excludes non cash stock compensation expense for the purposes of this Executive
Incentive Plan.
Operating Profit (Loss) is Business Unit Operating Profit (Loss) less corporate
support costs, litigation expenses, and intangible amortization. Operating
Profit (Loss) excludes non cash stock compensation expense for the purposes of
this Executive Incentive Plan.
Business Unit Operating Profit (Loss) is the revenue less departmental cost of
goods sold and direct operating expenses for a business unit. Direct operating
expenses are the expenses directly charged to a business unit including all
variable compensation accruals and all allocated departmental expenses. Business
Unit Operating Profit (Loss) excludes non cash stock compensation expense for
the purposes of this Executive Incentive Plan.
Target Incentive is a percentage determined by management of the participant’s
annual base salary as of February 4, 2008. The actual bonus amount will vary
depending on the extent to which Company performance targets, Business Unit
targets, and milestones are met as determined by the Company at its sole
discretion.
MBO’s are specific business milestones which must be completed, in strict
accordance with the stated terms and conditions associated with each MBO, to the
satisfaction of the CFO and CEO.

     
/s/ Victor Viegas
  March 27, 2008
 
   
Executive
  Date
 
   
/s/ Janice Passarello
  April 16, 2008
 
   
VP of Human Resources
  Date
 
   
/s/ S M Ambler
  April 7, 2008
 
   
CFO
  Date
 
   
/s/ Jack L Saltich
  April 21, 2008
 
   
Lead Director
  Date

 

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Attachment A
EXECUTIVE INCENTIVE PLAN STATEMENT OF GOALS FOR YEAR 2008
Victor Viegas
Percent of Base Salary Payment at Plan: 100%
The following is a statement of financial, strategic and tactical objectives for
2008 that will serve as a basis for overall performance evaluation and
determination of year-end executive incentive award.
Board of Directors Discretionary Multiplier: The Board of Directors will
determine a performance “weighting” to be applied to the Executive’s initial
incentive payment calculation (as determined based on the goals and objectives
below),which weighting will be based on the Executive’s overall annual
performance as determined solely by the Board. The weighting factor will
typically range from 0.80 to 1.20, which factor is then multiplied by the
executive’s initial incentive payment calculation to determine the executive’s
incentive payment.
Plan Components: The Plan has one Corporate financial performance component.
Within the Corporate component you will be measured against specific goals.
A. 100% of your target bonus will be based on Corporate performance as follows.

  •   (40%) Achieve GAAP Revenue of $42.900M. Achieve GAAP Operating Profit
(Loss) of $(16.100)M. Operating Profit (Loss) includes non cash stock
compensation expense. Operating Profit (Loss) amounts are stated prior to taking
account of Executive Incentive Plan payment amounts. Payment amounts are not
pro-rated between matrix levels.

                                          Revenue / Operating Profit (Loss)
Targets   $38.600M   $40.750M   $42.900M   $45.900M   $48.900M
$(12.900)M
    100 %     110 %     120 %     150 %     200 %
$(14.000)M
    90 %     100 %     110 %     120 %     150 %
$(16.100)M
    50 %     80 %     100 %     110 %     120 %
$(16.900)M
    0 %     50 %     80 %     90 %     90 %
$(17.700)M
    0 %     0 %     50 %     80 %     80 %

  •   (40%) Corporate Initiatives

  1.   M&A Activity: During FY2008 identify, conduct due diligence, close, and
assimilate at least one acquisition for the corporation that is greater than
$10M in Revenue or greater than $5M in Operating Income.     2.   Oracle
Implementation: Implement a company-wide ERP system by upgrading to Oracle 11i
in FY2008 from current version. A company-wide system will help to integrate the
majority of the data and processes of the organization into a unified system and
aid in the company attaining an overarching goal of integrating the businesses
more completely for operational and strategic efficiencies.     3.   Increase
International presence across all businesses: FY2008 International Revenue is
equal to or greater than 45% or $19M of total revenue.     4.   During 2008
generate at least 20 non financial or administrative press releases.

  •   (20%) MBO’s — to be agreed upon with Board of Directors.