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Exhibit 10.23
 
VIEWSONIC CORPORATION
Long Term Incentive Program
Summary of Terms

TERM
DESCRIPTION
Objectives of the Long Term Incentive Program (the “Incentive Program”)
The objectives of the Incentive Program are to motivate the executive team of
ViewSonic Corporation (the “Company”) to achieve key financial metrics and
increase stockholder value as well as to enhance employee retention.
 
Eligible Participants
Employees who are director level and above and who are designated by the
Compensation Committee of the Company’s Board of Directors (the “Compensation
Committee”) as participants under the Incentive Program (the “Eligible
Participants”).
 
Type of Award
A stock option (the “Performance Award”) to purchase the Company’s common stock
under the Company’s 2004 Equity Incentive Plan (the “2004 Plan”).
 
Timing of Grant
Anticipated to be in February 2007 (the “Grant Date”).
 
Number of Shares Subject to the Performance Award
The number of shares subject to each Eligible Participant’s Performance Award
shall be based on the Tiers indicated on Exhibit A hereto, into which each
Eligible Participant shall be placed at the sole discretion of the Compensation
Committee.
 
On the Grant Date, Eligible Participants shall be granted the maximum number of
options in which they could potentially vest under the Performance Award if 150%
of the Performance Targets (as defined below) is achieved (the “Maximum Award”)
(e.g., for a Tier 1 Eligible Participant, an option to purchase 450,000 shares
of common stock would be granted on the Grant Date). The portion of the
Performance Award in which an Eligible Participant could potentially vest if
100% of the Performance Targets (as defined below) is achieved is referred to as
the “Target Award.”
 
Performance Targets
The initial vesting of each Performance Award shall be based on the achievement
of both a revenue target (the “Revenue Target”) and an income target (the
“Income Target”) as set by the Compensation Committee (collectively, the
“Performance Targets”), which shall be based on the Company’s financial
performance for the fiscal year ending December 31, 2007.
 
The determination of whether the Performance Targets have been met shall be made
by the Compensation Committee, in its sole discretion, after the completion of
the Company’s audit for fiscal 2007 (the “Determination Date”).
 

 
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TERM
DESCRIPTION
Failure to Achieve the Minimum Performance Targets
Both the minimum Revenue Target and the minimum Income Target must be met for
any vesting of the Performance Award to occur. If either the minimum Revenue
Target or the minimum Income Target is not met, the Performance Award shall be
automatically cancelled and forfeited in its entirety.
 
Vesting of the Performance Award
If both of the minimum Performance Targets are met, the Performance Award shall
vest as follows:
 
The Target Award is first multiplied by the percentage of achievement of the
Performance Targets as determined by the Compensation Committee (a range of
between 100%-150% based on the levels achieved against both the Revenue and
Income Targets as reflected on Exhibit B hereto) (the “Eligible Award”) and then
divided by 3. This portion of the Eligible Award shall vest on the Determination
Date. The difference between the Maximum Award and the Eligible Award, if any,
shall be cancelled and forfeited on the Determination Date.
 
The remainder of the Eligible Award shall vest 1/3 on the second anniversary of
the Grant Date (the “Second Vesting Date”) and 1/3 on the third anniversary of
the Grant Date (the “Third Vesting Date”).
 
The vesting described above is subject to there being no break prior to the
relevant date in the Eligible Participant’s “Continuous Service” to the Company
as an employee as such term is defined in the 2004 Plan (“Service”).
 
Termination of Service
If an Eligible Participant’s Service terminates for any reason (other than
death) before the Determination Date, the Performance Award shall be cancelled
and forfeited in its entirety.
 
If an Eligible Participant’s Service terminates for any reason (other than
death) after the Determination Date, the Eligible Award shall cease vesting, and
any unvested portion of such Eligible Award shall be cancelled and forfeited in
its entirety.
 
Death of an Eligible Participant
If an Eligible Participant dies before the Determination Date, a portion of the
Performance Award shall vest on such date of death as follows:
 
The portion that shall vest is equal to the Target Award divided by 3, with such
quotient multiplied by a fraction, the numerator of which is the aggregate
number of full months of Service provided by the Eligible Participant from the
Grant Date to the date of death and the denominator of which is 12.
 
If an Eligible Participant dies after the Determination Date but before the
Second Vesting Date or the Third Vesting Date, as applicable, the following
portion of the Eligible Award shall vest on such date of death (in addition to
the portion of the Eligible Award already vested as described above under
“Vesting of the Performance Award”):
 
One third (⅓) of the Eligible Award shall be multiplied by a fraction, the
numerator of which is the aggregate number of full months of Service provided by
the Eligible Participant from either (a) the first anniversary of the Grant Date
to the date of death or (b) the second anniversary of the Grant Date to the date
of death, as applicable, and the denominator of which is 12.
 

 
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TERM
DESCRIPTION
Change in Control
If the effective date of a Change in Control (as such term is defined under the
2004 Plan) (the “Effective Date”) occurs before the Determination Date, the
Target Award shall vest on the Effective Date as follows:
 
The portion that shall vest is equal to the Target Award divided by 3, with such
quotient multiplied by a fraction, the numerator of which is the aggregate
number of full months of Service provided by the Eligible Participant from the
Grant Date to the Effective Date and the denominator of which is 12.
 
If the Effective Date occurs after the Determination Date but before the Second
Vesting Date or the Third Vesting Date, as applicable, the following portion of
the Eligible Award shall vest on such date (in addition to the portion of the
Eligible Award already vested as described above under “Vesting of the
Performance Award”):
 
One third (⅓) of the Eligible Award shall be multiplied by a fraction, the
numerator of which is the aggregate number of full months of Service provided by
the Eligible Participant from either (a) the first anniversary of the Grant Date
to the Effective Date or (b) the second anniversary of the Grant Date to the
Effective Date, as applicable, and the denominator of which is 12.
 

 
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TERM
DESCRIPTION
Compensation Committee
The Compensation Committee shall be the administrator of the Incentive Program
and shall be entitled to the amend the Incentive Program, subject to the
limitations set forth in the 2004 Plan.
 
Non-Binding; Governing Plan
This Summary of Terms is non-binding and is only intended to be summary of the
Incentive Program. It does not constitute an employment contract nor does it
represent the grant of a Performance Award or any entitlement thereto. Each
individual Performance Award granted by the Compensation Committee shall be
governed by the applicable Grant Notice, the Stock Option Agreement and the 2004
Plan.

 
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EXHIBIT A
 
LEVEL OF ELIGIBLE PARTICIPANT
TARGET AWARD
MAXIMUM AWARD
 
Tier 1
 
300,000 shares
450,000 shares
 
Tier 2
 
150,000 shares
225,000 shares
 
Tier 3
 
100,000 shares
150,000 shares
 
Director levels
To be determined
To be determined

 

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EXHIBIT B

PERFORMANCE TARGETS

Performance Award As a Percentage of the Performance Targets
 

[revenue.jpg]
125.0%
131.3%
137.5%
143.8%
150.0%
118.8%
125.0%
131.3%
137.5%
143.8%
112.5%
118.8%
125.0%
131.3%
137.5%
106.3%
112.5%
118.8%
125.0%
131.3%
100.0%
106.3%
112.5%
118.8%
125.0%

 
 [netincome.jpg]
Net Income

 
 

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