Exhibit 10.45
 SETTLEMENT AGREEMENT
    Microsoft Corporation v. Immersion Corp.,
   1.
    
    Payment. On or before October 1, 2008, Immersion shall cause to be transmitted to
Microsoft a one time payment by wire transfer in the amount of Twenty Million Seven
Hundred Fifty Thousand Dollars and no cents ($20,750,000). Such wire transfer shall
be made pursuant to wire instructions Microsoft provides in writing to Immersion.2.
    
    Dismissal of The Action. Not later than five days after Immersions payment pursuant
to Section 2 above, Microsoft and Immersion shall direct their counsel of record in the
Action to sign a Stipulation and Order For Dismissal With Prejudice (Stipulation) in
the form attached hereto as Exhibit A. Immersion and Microsoft shall cause the
signed Stipulation to be filed with the United States District Court for the Western
District of Washington as soon as practicable. The Parties agree to take all actions
reasonably necessary to effect the above-described Stipulation and obtain the
dismissal of the Action, including all claims and counterclaims therein, with prejudice.3.
    
    Termination of Sublicense Agreement. The Sublicense Agreement between the
Parties dated July 25, 2003, is terminated and is of no further force and effect. For the
avoidance of doubt, all of Immersions obligations under the Sublicense Agreement
are deemed satisfied, discharged and terminated in full.




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4.
    
    Certified Partner Program  Gold Level. Microsoft agrees to admit Immersion into
Microsofts Gold Certified Partner Program, at no cost for a period of five years,
provided that Immersion meets all of the other requirements for inclusion in that
program, including any necessary training, certification, competency participation and
partner points. The above-described five year period shall begin to run from the date
on which Immersion has reached the Gold Certified Partner Level, or eighteen (18)
months from the Effective Date, whichever is earlier, although in the latter case
Immersion shall not be admitted at the Gold Certified Partner Level until it qualifies.
Services or resources available to Gold Certified Partners for additional fees will be
available to Immersion under the normal terms and conditions applicable to the
Program, including any additional fee (but with the exception of any annual
membership or program fees, which such fees are expressly waived). Microsoft
further agrees to enter into a Microsoft Services OEM Foundation Service Agreement
with Immersion (the Service Agreement), under which Microsoft agrees to provide
Immersion, at no cost to Immersion, with up to 100 hours of support during a 12-
month period commencing from the execution of the Service Agreement.5.
    
    Mutual Releases. As of the Effective Date, Microsoft and Immersion each hereby
mutually release and forever discharge the other Party (and the other Partys current
and former officers, directors, employees, and attorneys), from any and all claims,
causes of action, demands, liabilities, damages, costs, attorneys fees, or losses of any
kind or nature (hereafter Claims), whether known or unknown, which were asserted
or could have been asserted in the Action, or which relate to the Sublicense
Agreement, or which Microsoft or Immersion now has, or may hereafter acquire, by
reason of any matter, cause or thing whatsoever accruing, occurring or arising at any
time prior to the Effective Date. Nothing herein shall be deemed to release either
Party from an action to enforce the terms of this Settlement Agreement or any other
agreement that remains in effect between the Parties. For the avoidance of doubt,
Microsoft hereby agrees that the Releases provided herein now and forever discharge
Immersion from any and all obligations under the Sublicense Agreement, and that
pursuant to Section 4 above such Sublicense Agreement has no further force or effect.6.
    
    Waiver of Statutory or Other Rights Regarding Unknown Claims. The Parties agree
and acknowledge that they may have sustained damages, losses, fees, costs or
expenses that are presently unknown and unsuspected, and that such damages, losses,
fees, costs or expenses as either of them may have sustained might give rise to
additional damages, losses, fees, costs, or expenses in the future. The Parties further
acknowledge that they have been advised of and are familiar with the provisions of
Section 1542 of the California Civil Code, and like or similar provisions of other
States laws, which provide:
 A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.
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Notwithstanding such provision, this Agreement shall constitute a full release in accordance
with its terms. Each of the Parties knowingly and voluntarily waives the provisions of § 1542,
as well as any other statute, law, or rule of similar effect, and acknowledges and
agrees that this waiver is an essential and material term of this Agreement, and without such
waiver, the Agreement would not have been accepted. Each Party hereby represents that it has
been advised by his or its legal counsel, and that it understands and acknowledges the
significance and consequence of this release and of this specific waiver of § 1542 and other
such laws.7.
    
    No Other Asserted Claims. Microsoft and Immersion each represent and warrant that
other than the Action, as of the Effective Date of this Agreement, neither Microsoft
nor Immersion has filed or asserted in any state or federal court, administrative
agency, or other tribunal any claim against the other.8.
    
    Other or Additional Facts. Each of the Parties expressly and knowingly acknowledges
that it may hereafter discover facts different from and/or in addition to those which it
now knows and/or believes to be true with respect to its respective Claims released
under this Agreement, and which, if known to it at the time it executed this
Agreement, may have materially affected its decision to execute this Agreement.
Each of the Parties acknowledges and agrees that by reason of this Agreement and the
releases contained herein, it is voluntarily, knowingly, and after receiving the advice
of counsel assuming any risk of such unknown facts and such unknown and
unsuspected claims and that this Agreement shall be and shall remain in full force and
effect in all respects.9.
    
    Other Agreements. All agreements currently in effect between the Parties other than
the Sublicensing Agreement including without limitation, the License Agreement
between the Parties dated July 25, 2003, and the Confidentiality Agreement between
the Parties dated May 11, 2007, remain in full force and effect. The Parties will
continue to abide by the Protective Order issued by the Court in this case, including
the provisions regarding return or destruction of documents.10.
    
    Parties to Bear Own Fees and Costs. Each Party shall bear all of its fees, expenses,
and costs incurred in connection with the Action and with this Settlement Agreement.11.
    
    Authority to Enter into Agreement. Each individual signing this Agreement warrants
and represents that he or she has full authority to execute the same on behalf of the
Party on whose behalf he or she signs. Each Party hereto agrees to execute all
documents and instruments necessary to implement this Agreement.12.
    
    Governing law: This Agreement, including all matters of construction, validity and
performance, shall be governed by, and construed and enforced in accordance with,
the law of the State of Washington as applicable to contracts entered into and to be
performed wholly within the State of Washington between citizens of Washington,
and without reference to any rules governing conflicts of law.
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13.
    
    Integration: This Agreement sets forth the entire agreement between the
Parties
relating to the subject matter of this Agreement and supersedes all prior and
contemporaneous written and oral understandings and agreements.14.
    
    Representations and Warranties:
 (a)
    
    Each of the Parties represents and warrants (i) that no other person
or
entity has, or has had, any interest in any Claims released in this
Agreement; (ii) that it has the rights and authority to execute this
Agreement; and (iii) that it has not sold, assigned, transferred, conveyed or
otherwise disposed of any of the Claims released in this Agreement.(b)
    
    Each of the Parties hereto acknowledges that no other Party, nor any
agent
or attorney of any other Party, has made any promise, representation, or
warranty, whatsoever, express or implied, not contained herein,
concerning the subject matter hereof, to induce it to execute this
instrument. Each of the Parties acknowledges that it has not executed this
instrument in reliance on any such promise, representation, or warranty
not contained herein.(c)
    
    Each of the Parties hereto has read this Agreement carefully and
knows
and understands the contents thereof. Each of the Parties is fully aware of
the legal and binding effect of this Agreement. Each of the Parties has
made such an investigation of the facts pertinent to this Agreement and of
all the matters pertaining thereto as it deemed necessary.(d)
    
    Each of the Parties hereto acknowledges that it has been represented
by
counsel in the preparation, negotiation and execution of this Agreement,
and that it has executed this document with the consent and the advice of
such legal counsel.(e)
    
    Each of the Parties hereto acknowledges and agrees that the terms of
this
Agreement are contractual and not merely recitals and are the result of
negotiations between Parties represented by sophisticated counsel. All
recitals are incorporated by reference into this Agreement.
 15.
    
    Amendment: This Agreement may be amended only by a writing signed by
authorized representatives of both Parties.16.
    
    Waiver: To be effective, the waiver of any right of either Party under this Agreement
must be in writing. The failure of either Party to require performance of any obligation under
this Agreement shall not affect such Partys right at a later time, to enforce the same.
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17.
    
    Confidentiality: The negotiations leading to this Settlement Agreement,
including
proceedings before the mediator and all facts or assertions made therein, and the
provisions of this Settlement Agreement relating to the Certified Partner Program
(paragraph 4 above) are confidential (confidential matters). The Parties agree to
maintain confidentiality and not disclose these confidential matters to any person or
entity. The confidential matters shall not be disclosed to the general public by either
Party except as required by law or in response to a valid subpoena or
court order.
Notwithstanding the foregoing, the Parties may disclose the existence and terms of
confidential matters to their accountants, attorneys or as otherwise necessary within
their respective organizations, or as they may otherwise mutually agree. Violations of
the confidentiality requirement of this Section are actionable in a binding arbitration
before James A. Smith, Jr., who shall have the discretion to award the prevailing party
attorneys fees, arbitrator fees, and costs.18.
    
    Successors and Assigns. This Agreement shall bind and inure to the benefit of the
Parties hereto and their respective predecessors, successors, and permitted assigns.
Immersion shall have the right to assign its rights and/or obligations hereunder to any
acquirer of all or substantially all of the business or assets of Immersion, to the
surviving entity of a merger involving Immersion, or in connection with a change of
control of Immersion. Any assignment of rights under the Certified Partner Program
shall be governed by the provisions of that program. Notwithstanding anything to the
contrary in this Settlement Agreement, in the event of a permitted assignment, in no
event will the assignee be deemed to have released any claims that such assignee may
have other than the claims of the assigning Party which are expressly released by that
Party hereunder.19.
    
    No Admission of Liability.This Settlement Agreement is a compromise settlement
and does not constitute an admission of liability by any Party. Neither Party is
admitting liability to the other with respect to any matter.20.
    
    Notices: Any notice given pursuant to this Settlement Agreement shall be in writing,
addressed as set forth below, and sent by registered or certified mail.
  
  
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21.
    
    Captions: The section headings contained herein are for reference purposes only
and shall not in any way affect the meaning or interpretation of this Agreement.22.
    
    Counterparts; Signatures: This Agreement may be executed in one or more
counterparts, each of which will be an original, but all or which shall constitute one
and the same document. Facsimile signatures of this Agreement shall be treated as
original signatures.ACCEPTED AND AGREED to by the undersigned authorized representatives:
 MICROSOFT CORPORATION
    
    
    
    IMMERSION CORPORATIONBy:
    
    /s/ Steven J. Aeschbacher
    
    
    
    By:
    
    /s/ Clent RichardsonName:
    
    Steven J. Aeschbacher
    
    
    
    Name:
    
    Clent RichardsonTitle:
    
    Associate General Counsel
    
    
    
    Title:
    
    President and CEO
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