Exhibit 10.37


 


March 25, 2005


 


 


William C. Bousema


1815 Port Tiffin Place


Newport Beach, CA  92660


 


Dear Bill:


We are pleased to offer you the position of Senior
Vice President and Chief Financial Officer with Primal Solutions, Inc., a
Delaware Corporation (“Primal”). 
Additionally, you have agreed to serve as Corporate Secretary.   This is an exempt position based at our
Irvine office, located at 18881 Von Karman Avenue, Suite 500, Irvine, California.  You will report directly to me.  Your
start date is retroactive to February 1, 2005.


Our normal office hours are Monday through Friday,
8:30 am to 5:30 pm.  We maintain a
business casual office environment. 
Client meetings may require more formal business attire.


As a condition of employment, you will be required to
sign our standard Employee Confidentiality & Invention Assignment
Agreement, which is enclosed.  Further,
this offer of employment is contingent on verification of your right to work in
the United States, as required by the Immigration Reform and Control Act of
1986.


Your compensation will include:


	
  Base Salary

  	
  $7,291.66 paid
  semi-monthly based on Primal’s payroll schedule ($175,000 annualized amount
  working full time).

  
	
  Executive Incentive Compensation

  	
  You may be entitled to
  receive, in the form of additional compensation, an amount not less than 35%
  of your base salary upon meeting or exceeding certain Company Performance
  Goals.  The Company Performance Goals
  for Fiscal Year 2005 incentive compensation purposes will include both
  individual and company-wide targets. The Company Performance Goals for Fiscal
  Year 2005 are still under development and are expected to be finalized by
  March 31, 2005.

  
	
  Duties

  	
  In
  addition to those duties and responsibilities set forth on Exhibit A
  hereto, you will have such duties as are assigned or delegated to you by the Chief
  Executive Officer or the Company’s Board of Directors.

  
	
  Stock Options

  	
  Following
  commencement of employment, a recommendation will be made to the Board of
  Directors to grant to you options to purchase 1,081,062 shares of common
  stock under our 2004 Flexible Incentive Plan, which Primal stock options are
  scheduled to vest over a three year period.

  You
  will receive credit for your service as a consultant in calculating your 

   

  



 





















 


	
   

  	
  stock option
  vesting.  Additionally, if at any time
  during your employment by Primal, (i) you are terminated without Cause, or
  (ii) you terminate your employment for Good Reason, all outstanding unvested
  stock options granted to you will accelerate and vest.

  
	
  Paid Time-Off

  	
  As an employee
  of Primal, you are eligible for paid vacations, personal holidays, and sick
  leave.  The Employee Handbook describes
  Primal’s current policies regarding these benefits.  As a member of Primal’s  senior management team, you will be
  eligible to accrue up to four (4) weeks annual paid vacation in addition to
  those paid holidays recognized in Primal’s employment policies. 

  
	
  Benefits

  	
  Primal
  provides medical, dental, life, AD&D, short- and long- term disability
  insurance and a 401(k) program. You will be eligible to participate in the
  Primal benefits plan per Primal’s standard benefits policy.  You will receive credit for your 4 months
  of service as a consultant to Primal.

  Primal
  will pay or reimburse you for reasonable expenses incurred and expenditures made
  by you on behalf of or at the request of Primal in the performance of your
  duties as Senior Vice President, Chief Financial Officer and Secretary, in
  accordance with the Primal’s employment policies, including attending
  conventions, seminars, and other business meetings, in appropriate business
  entertainment activities and for promotional expenses. 

  
	
  Termination

  	
  A
  description of benefits you may be entitled to receive in the event of a
  change in control has been separately addressed in that certain Change in
  Control Agreement between you and Primal, of even date herewith.

  The
  following paragraphs of this Termination section (the “Severance Provisions”)
  shall expire on the 1st anniversary of your employment with Primal
  and are applicable to circumstances other than a Change in Control:

  (A)          Other than in the event of a Change
  in Control, if Primal terminates your employment without Cause or if you
  terminate your employment for Good Reason (as those capitalized terms are
  defined in the Change in Control Agreement), Primal will pay you (i) your
  salary for the remainder, if any, of the calendar month in which such
  termination is effective and for an additional 9-month period, (ii) 75% of
  your incentive compensation for the Fiscal Year during which the termination
  is effective and calculated assuming that 100% of the targets under such
  bonus plans are achieved,  (iii)
  accrued vacation through the date of termination, (iv) accrued but unpaid
  incentive compensation from the previous Fiscal Year, if any, (v) executive
  outplacement assistance for a period of 9 months, and (vi) continued coverage
  under Primal’s medical, dental, life and disability plans or under a COBRA
  plan providing similar benefits if continued coverage under Primal’s

   

  



 


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  benefits
  plans is not permitted, for you and your dependents on the same terms as in
  effect at the time of termination of employment, for the period from the date
  of termination until you obtain replacement coverage through other employment
  or for a period of 9 months after such employment termination, whichever is
  less.  Payments will only be made for
  termination for Good Reason if you terminate within 1 month of the occurrence
  of Good Reason. In no event will payments under (i), (ii), (iv) and (v),
  above extend beyond 2-1/2 months following the close of the calendar year in
  which termination under this paragraph occurs, and payments will be
  accelerated, if necessary, to prevent such 2-1/2 month period to be exceeded.

  (B)           If Primal terminates you for Cause,
  or if you terminate your employment other than for Good Reason or disability,
  Primal will pay you (i) your salary plus accrued vacation through the date
  such termination is effective, and (ii) accrued and unpaid incentive compensation
  from the previous Fiscal Year and for the then-current Fiscal Year (but only
  to the extent such incentive compensation has been earned and appropriate
  Company Performance Goals have been achieved prior to the termination of
  employment), if any.

  (C)           Upon Disability (as defined in the
  Change in Control Agreement) for 120 consecutive days, or 180 days in any
  12-month period, your employment may be terminated by either you or Primal
  and upon such termination you will be entitled to (i) your salary, offset by
  any payments made or benefits received by you in connection with any Company
  disability policy, disability insurance or state disability program, plus
  accrued vacation through the date of such termination, (ii) your
  incentive compensation, if any, for the Fiscal Year in which the Disability
  occurs, prorated through the end of the calendar month in which the
  disability is deemed to have occurred, provided that the Company Performance
  Goals for such Fiscal Year have been met, (iii) accrued and unpaid incentive
  compensation, if any, from the previous Fiscal Year, and (iv) continued
  coverage under Primal’s medical, dental, life and disability plans or under a
  COBRA plan providing similar benefits if continued coverage under Primal’s
  benefits plans is not permitted, for you and your dependents on the same
  terms as in effect at the time of termination of employment, for a period of
  3 months after such employment termination. 
  Payments under  (ii) and (iii),
  above will be made no later than 2-1/2 months following the close of the
  calendar year in which termination under this paragraph occurs.

  (D)          Upon death, your designated
  beneficiary will be entitled to

  (i) your salary plus accrued vacation through the date of such termination,
  (ii) your incentive compensation, if any, for the Fiscal Year in which your
  death occurs, prorated through the end of the calendar month in which such
  death occurs, provided that the Company Performance Goals for such Fiscal
  Year have been met, 

   

  



 


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  (iii)
  accrued and unpaid incentive compensation, if any, from the previous Fiscal
  Year, and (iv) continued coverage under Primal’s medical, dental, life and
  disability plans or under a COBRA plan providing similar benefits if
  continued coverage under Primal’s benefits plans is not permitted, for your
  dependents on the same terms as in effect at the time of termination of
  employment, for a period of 3 months after such employment termination.

  As
  a condition of and prior to you receiving any unvested pay or benefits
  hereunder, Primal may require you to execute a release of all claims that you
  may have against Primal or its affiliates arising from your employment with
  Primal or its affiliates or the termination thereof, in a form reasonably
  satisfactory to Primal.

  Notwithstanding
  the foregoing, for the 60 day period prior to the expiration of the 1st
  anniversary of your employment with Primal, Primal will commence negotiations
  with you in good faith regarding the new terms of this Termination section
  (the “New Severance Provisions”).  If,
  following such good faith negotiations of the New Severance Provisions, you
  and Primal are unable to reach agreement regarding the New Severance
  Provisions, the Severance Provisions contained herein shall expire on their
  terms.  If Primal does not negotiate in
  good faith, this letter agreement will expire on the one year anniversary of
  your employment, your employment with Primal will be terminated and you will
  be paid the severance benefits provided for in paragraph A of this
  Termination section and all outstanding unvested stock options granted to you
  will accelerate and vest.

  
	
  Non-Interference

  	
  In consideration of the compensation and benefits to
  be paid or provided to you by Primal, you hereby covenant that you will not,
  directly or indirectly during your employment with Primal and for as long as
  you are entitled to severance benefits thereafter (i)  solicit business of the same or similar
  type being carried on by Primal, (ii) solicit as an employee, independent contractor,
  or otherwise, any person who is an employee of Primal or in any manner induce
  or attempt to induce any employee of Primal to terminate his or her
  employment with Primal, or (iii) interfere with Primal’s relationship with
  any person, including any person who at any time during your period of
  employment with Primal was an employee, contractor, supplier, or customer of
  Primal.

  If you breach any of the terms and provisions of
  this Non-Interference section following the termination of your employment, Primal
  may, in addition to any other remedies that Primal may have for any such
  breach, immediately terminate the payment of any severance payments or
  benefits then being paid to you hereunder, other than payments vested prior
  to the date of termination of your employment.

  



 


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  Miscellaneous

  	
   

  Arbitration.

  (A)          Arbitration
  shall be the sole and exclusive remedy for any dispute, claim, or controversy
  of any kind or nature (a “Claim”) arising out of, related to, or connected
  with this letter agreement or the termination of the your employment
  relationship with Primal. This mutual agreement to arbitrate includes any
  Claim by you against any parent, subsidiary, or affiliated entity of Primal,
  or any director, officer, general or limited partner, employee or agent of
  Primal or of any such parent, subsidiary or affiliated entity. It also
  includes any claim against you by Primal, or any parent, subsidiary or
  affiliated entity of Primal.

  (B)           This
  section does not apply to any claims by you: (1) for workers’ compensation
  benefits; (2) for unemployment insurance benefits; (3) under a benefit plan
  where the plan specifies a separate arbitration procedure; (4) filed with an
  administrative agency which are not legally subject to arbitration under this
  letter agreement; or (5) which are otherwise expressly prohibited by law from
  being subject to arbitration under this letter agreement.

  (C)           Any
  arbitration proceedings shall be conducted in Orange County, California. Any
  Claim submitted to arbitration shall be decided by a single, neutral
  arbitrator (the “Arbitrator”). The parties to the arbitration shall mutually
  select the Arbitrator not later than 45 days after service of the demand for
  arbitration. If the parties for any reason do not mutually select the
  Arbitrator within the 45 day period, then any party may apply to any court of
  competent jurisdiction to appoint a retired judge as the Arbitrator. The
  parties agree that arbitration shall be conducted in accordance with California
  Code of Civil Procedure sections 1280 et seq., including Code of Civil
  Procedure section 1283.05 regarding discovery, except as modified in
  this Agreement. The Arbitrator shall apply the substantive federal, state, or
  local law and statute of limitations governing any Claim submitted to
  arbitration. In ruling on any Claim submitted to arbitration, the Arbitrator
  shall have the authority to award only such remedies or forms of relief as
  are provided for under the substantive law governing such Claim. The Arbitrator
  shall issue a written decision revealing the essential findings and
  conclusions on which the decision is based. Judgment on the Arbitrator’s
  decision may be entered in any court of competent jurisdiction.

  (D)          Primal
  shall be responsible for paying the fees and costs incurred in the
  arbitration (e.g., filing fees, transcript costs and Arbitrator’s fees). The
  parties shall be responsible for their own attorneys’ fees and costs, except
  that the Arbitrator shall have the authority to award attorneys’ fees and
  costs to the prevailing party in accordance with the applicable 

  



 


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  law governing the dispute.

  (E)           The
  Arbitrator, and not any federal or state court, shall have the exclusive
  authority to resolve any issue relating to the interpretation, formation or
  enforceability of this letter agreement, or any issue relating to whether a
  Claim is subject to arbitration under this letter agreement, except that any
  party may bring an action in any court of competent jurisdiction to compel
  arbitration in accordance with the terms of this letter agreement.

  Severability.  In the
  event any provision of this letter agreement or the application thereof to
  any circumstance shall be held by a court of competent jurisdiction to be
  invalid, illegal or unenforceable, then such provision shall be deemed to be
  deleted herefrom in any action before that court, and all other provisions of
  this letter agreement shall remain in full force and effect.

  



You acknowledge that this offer letter is not intended
to be construed as an employment agreement for any specific term, and that
Primal is an “at-will” employer. Either you or Primal are free to terminate
your employment relationship at any time, with or without cause and with or without
notice. This is the full and complete agreement between us concerning duration
of employment and termination of employment. The “at-will” nature of your
employment may only be changed in an expressed writing signed by you and the
President of Primal.


If you have any questions concerning the terms of this
offer, please do not hesitate to contact me. 
I feel the position will be a challenging, exciting and rewarding one
for you, and I personally look forward to working with you.  Please acknowledge your acceptance and
understanding of these terms by signing and returning the following endorsement
no later than March   , 2005. 
If possible, please fax a copy of the signed letter and the last page of
the Confidentiality Agreement within the next day to (949) 221-8590.  This offer is valid through March   ,
2005.  The additional copy is for your
records. Congratulations!


 


	
  Sincerely,

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Joseph R. Simrell

  	
   

  	
   

  
	
  Joseph R. Simrell

  	
   

  	
   

  
	
  President & Chief Executive Officer

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Attachment:   Employee
  Confidentiality and Invention Assignment Agreement

  	
   

  
	
   

  	
   

  	
   

  
	
  Accepted and Agreed to: 

  	
  /s/ Bill Bousema

  	
  3/25/04

  
	
   

  	
  Signature

  	
  Date

  
	
   

  	
   

  	
   

  
					



 


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Exhibit A


 


 


7