DEF 14A 1 immr2021proxystatement.htm DEF 14A
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Schedule 14A Information (Rule 14a-101)
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
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Immersion Corporation

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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April 1, 2021
TO THE STOCKHOLDERS OF IMMERSION CORPORATION
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders (the “Annual Meeting”) of Immersion Corporation, which will be held at our principal executive offices located at 330 Townsend Street, Suite 234, San Francisco, CA 94107, on May 13, 2021, at 9:30 a.m. Pacific Time.
At the Annual Meeting, stockholders will be asked to vote on each of the three (3) proposals set forth in the Notice of Annual Meeting of Stockholders and the Proxy Statement, which describe the formal business to be conducted at the Annual Meeting and follow this letter.
It is important that your shares be represented and voted at the Annual Meeting regardless of the size of your holdings. please complete, sign, date and return the accompanying proxy card in the enclosed postage-paid envelope. Voting electronically, by telephone, or by returning your proxy card in advance of the Annual Meeting does not deprive you of your right to attend the Annual Meeting.
On behalf of the Board of Directors, I would like to express our appreciation for your continued support for and interest in the affairs of our company. We look forward to seeing you at the Annual Meeting.
Sincerely,
Jared Smith
Interim Chief Executive Officer and Vice President, Worldwide Sales

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 13, 2021

The Annual Meeting will be held at our corporate offices located at 330 Townsend Street, Suite 234, San Francisco, CA 94107, on May 13, 2021, at 9:30 a.m. Pacific Time for the following purposes:
1.To elect four (4) directors to hold office for the applicable term and until their successor is elected and qualified;
2.To ratify the appointment of Armanino LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2021;
3.To hold an advisory vote to approve the compensation of our named executive officers; and
4.To transact such other business as may properly come before the Annual Meeting or any adjournments or postponements thereof.
Only stockholders of record at the close of business on March 19, 2021 are entitled to notice of, and to vote at, the Annual Meeting and at any adjournments or postponements thereof.
The vote of each eligible stockholder is important. Please vote as soon as possible to ensure that your vote is recorded promptly even if you plan to attend the Annual Meeting.
BY ORDER OF THE BOARD OF DIRECTORS,
JARED SMITH
Interim Chief Executive Officer and Vice President, Worldwide Sales
San Francisco, California
April 1, 2021
We intend to hold our Annual Meeting in person. However, we are actively monitoring the coronavirus (COVID-19) situation and are sensitive to the public health and travel concerns our stockholders may have and the protocols that federal, state, and local governments may impose. In the event it is not possible or advisable to hold our Annual Meeting in person, we will announce alternative arrangements for the meeting as promptly as practicable, which may include holding the meeting solely by means of remote communication. If we take this step, we will announce the decision to do so in advance by filing Definitive Additional Materials with the SEC along with notice of the change(s) to the Annual Meeting, and details on how to participate will be available at www.envisionreports.com/IMMR and https://ir.immersion.com/financials-and-filings/annual-reports-and-proxies.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 13, 2021: THIS PROXY STATEMENT AND THE ANNUAL REPORT ARE AVAILABLE AT
https://ir.immersion.com/financials-and-filings/annual-reports-and-proxies

IMMERSION CORPORATION
2021 ANNUAL MEETING OF STOCKHOLDERS
NOTICE OF ANNUAL MEETING AND PROXY STATEMENT
TABLE OF CONT
TABLE OF CONTENTS

Contents |
PROXY STATEMENT | 2
QUESTIONS AND ANSWERS | 2
ELECTION OF DIRECTORS (PROPOSAL 1) | 8
DIRECTOR COMPENSATION | 14
CORPORATE GOVERNANCE | 18
RELATED PERSON TRANSACTIONS | 26
OWNERSHIP OF OUR EQUITY SECURITIES | 27
Directors and Executive Officers | 28
Principal Stockholders | 29
Delinquent Section 16(a) Reports | 29
EXECUTIVE OFFICERS | 30
COMPENSATION DISCUSSION AND ANALYSIS | 31
Executive Summary | 32
Compensation Philosophy | 37
Compensation Determination Process | 38
Elements of Compensation | 41
Additional Compensation Policies and Practices | 46
COMPENSATION COMMITTEE REPORT | 48
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION | 49
EXECUTIVE COMPENSATION | 50
2020 Summary Compensation Table | 51
2020 Grants of Plan-Based Awards | 53
Outstanding Equity Awards at December 31, 2020 | 54
Stock Vested In Fiscal 2020 | 55
Stock Options Exercised In Fiscal 2020 | 55
Potential Payments upon Termination or Change in Control | 55
CEO Pay Ratio | 57
EQUITY COMPENSATION PLAN INFORMATION | 58
AUDIT COMMITTEE REPORT | 59
RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PROPOSAL 2) | 60
Audit Fees and All Other Fees | 62
Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors | 62
Other Information | 63
ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS (PROPOSAL 3) | 63

PROXY STATEMENT
We are providing you with these proxy materials in connection with the solicitation by the Board of Directors of (the “Board” or the “Board of Directors”) Immersion Corporation, of proxies to be used at our 2021 Annual Meeting of Stockholders (“Annual Meeting”). The Annual Meeting will be held at our corporate offices located at 330 Townsend Street, Suite 234, San Francisco, CA 94107 on May 13, 2021 at 9:30 a.m. Pacific Time. This proxy statement contains important information regarding our Annual Meeting, the proposals on which you are being asked to vote, information you may find useful in determining how to vote, and information about voting procedures.
This proxy statement, any accompanying proxy card or voting instruction form, and our Annual Report on Form 10-K for the year ended December 31, 2020 (the “Annual Report”) to Stockholders will be mailed to or otherwise made available to our stockholders on or about April 1, 2021.

QUESTIONS AND ANSWERS
What is included in the proxy materials?

The proxy materials for our Annual Meeting include this proxy statement and our Annual Report. If you received a paper copy of these materials, the proxy materials also include a proxy card or voting instruction form.
Who is soliciting my vote?

The Board of Directors of Immersion Corporation is soliciting your vote at our Annual Meeting.
Who is entitled to vote?

You may vote if you were the record owner of Immersion Corporation common stock as of the close of business on March 19, 2021. Each share of common stock is entitled to one vote. As of March 19, 2021, we had 30,867,177 shares of common stock outstanding and entitled to vote. There is no cumulative voting.
Who can attend the Annual Meeting?

Stockholders of record at the close of business on March 19, 2021 may attend the Annual Meeting. You must bring with you a form of government-issued photo identification, such as a driver’s license, state-issued ID card, or passport to gain entry to the Annual Meeting. If you are a beneficial owner of our common stock, you must also bring with you to the Annual Meeting a legal proxy from the organization that holds your shares or a brokerage statement showing your ownership of shares as of the close of business on the record date. If you are a representative of an institutional stockholder, you must also bring a legal proxy or other proof that you are a representative of a firm that held shares as of the close of business on the record date and that you are authorized to vote on behalf of the institution.
We intend to hold our Annual Meeting in person. However, we are actively monitoring the coronavirus (COVID-19) situation and are sensitive to the public health and travel concerns our stockholders may have and the protocols that federal, state, and local governments may impose. In the event it is not possible or advisable to hold our Annual Meeting in person, we will announce alternative arrangements for the meeting as promptly as practicable, which may include holding the meeting solely by means of remote communication. If we take this step, we will announce the decision to do so in advance by filing Definitive Additional Materials with the SEC along with notice of the change(s) to the Annual Meeting, and details on how to participate will be available at www.envisionreports.com/IMMR and https://ir.immersion.com/financials-and-filings/annual-reports-and-proxies.
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How many votes must be present to hold the Annual Meeting?

Your shares are counted as present at the Annual Meeting if you attend the meeting and vote in person or if you properly return a proxy by Internet, telephone or mail. For us to hold our Annual Meeting, holders of a majority of our outstanding shares of common stock entitled to vote at the Annual Meeting as of March 19, 2021, must be present in person or by proxy at the meeting. This is referred to as a quorum. Abstentions and broker non-votes will be counted for purposes of establishing a quorum at the meeting.
What is the difference between holding shares as a stockholder of record and as a beneficial stockholder?

If your shares are registered directly in your name with our registrar and transfer agent, Computershare Trust Company, N.A. (“Computershare”), you are considered a stockholder of record with respect to those shares. If your shares are held in a brokerage account or bank, you are considered the “beneficial owner” or “street name” holder of those shares.
What is a broker non-vote?

Applicable rules permit brokers to vote shares held in street name on routine matters when the brokers have not received voting instructions from the beneficial owner on how to vote those shares. Brokers may not vote shares held in street name on non-routine matters unless they have received voting instructions from the beneficial owners on how to vote those shares. Shares that are not voted on non-routine matters are called broker non-votes. Broker non-votes will have no effect on the vote for any matter properly introduced at the meeting.
What routine and non-routine matters will be voted on at the Annual Meeting?

The ratification of Armanino LLP as our independent registered public accounting firm for 2021 is the only routine matter to be presented at the Annual Meeting on which brokers may vote in their discretion on behalf of beneficial owners who have not provided voting instructions. The non-routine matters that will be voted on at the Annual Meeting include the election of four (4) directors, and the advisory vote to approve compensation of our named executive officers.
How are withhold votes, abstentions and broker non-votes counted?

Abstentions, withhold votes and broker non-votes are included in determining whether a quorum is present. Abstentions will have the same effect as a vote “AGAINST” on the advisory vote on executive compensation and the vote to ratify the independent public accounting firm because an abstention represents a share entitled to vote on such proposal. Withhold votes will have no effect on any director nominee proposals. Broker non-votes will have no effect on the vote for any matter properly introduced at the Annual Meeting.
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What are my voting choices for each of the proposals to be voted on at the Annual Meeting and how does the Board recommend that I vote my shares?

|  | More Information | Voting Choices and Board Recommendation
PROPOSAL 1 | Election of four Directors | Page 8 | • vote FOR the nominees; or • withhold your vote for the nominees. The Board recommends a vote FOR the nominees.
PROPOSAL 2 | Ratification of Independent Registered Public Accounting Firm | Page 60 | • vote FOR the ratification; • vote against the ratification; or • abstain from voting on the ratification, which will have the same effect as a vote AGAINST. The Board recommends a vote FOR the ratification.
PROPOSAL 3 | Advisory vote on the compensation of our named executive officers | Page 63 | • vote FOR, the advisory proposal; • vote against the advisory proposal; or • abstain from voting on the advisory proposal, which will have the same effect as a vote AGAINST. The Board recommends an advisory vote FOR the compensation of our named executive officers.

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How many votes are needed to approve each proposal?

The director nominees shall be elected by a plurality of the votes cast (meaning that the four director nominees who receive the highest number of votes cast “FOR” their election will be elected as directors). There is no cumulative voting with respect to the election of directors. All other proposals submitted require the affirmative “FOR” vote of the majority of the shares present in person or presented by proxy at the Annual Meeting and entitled to vote thereon. As an advisory vote, the proposal to approve the compensation of our named executive officers is not binding upon us. However, the Compensation Committee, which is responsible for designing and administering our executive compensation programs, values the opinions expressed by stockholders and will consider the outcome of the vote when making future compensation decisions.
How do I vote?

Stockholders of Record: You can vote either in person at the Annual Meeting or by proxy. Persons who vote by proxy need not, but are entitled to, attend the Annual Meeting. Even if you plan to attend the Annual Meeting, we encourage you to vote your shares by proxy.
This proxy statement, the accompanying proxy card and the Annual Report are being made available to our stockholders on the Internet at www.envisionreports.com/IMMR.
You may vote your shares as follows – in all cases, have your proxy card in hand:

| Vote over the Internet 24/7 at www.envisionreports.com/IMMR |  | Dial toll-free 24/7 (800) 652-VOTE within the USA, US territories & Canada
| Vote using your tablet or smartphone |  | If you elected to receive a hard copy of your proxy materials, fill out the enclosed proxy card, date and sign it, and return it in the enclosed postage-paid envelope.

Beneficial Stockholders: If you hold your shares of Immersion Corporation common stock in a brokerage account (that is, in “street name”), your ability to vote by telephone or over the Internet depends on your broker’s voting process. Please follow the directions on your proxy card or voting instruction card carefully. Please note that brokers may not vote your shares on Proposal 1 (Election of Directors) or Proposal 3 (Advisory vote on executive compensation). Please provide your voting instructions so your vote can be counted on these matters.
If you plan to vote in person at the Annual Meeting and you hold your shares of Immersion Corporation common stock in street name, you must obtain a proxy from your broker and bring that proxy to the Annual Meeting.
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How can I revoke my proxy or change my vote?

You can revoke your proxy or change your vote at any time before they are exercised in any of the following ways:
•by submitting written notice of revocation of your proxy to our Corporate Secretary at Immersion Corporation, 330 Townsend Street, Suite 234, San Francisco, CA 94107 so that it is received prior to the Annual Meeting;
•voting again by telephone or over the Internet prior to 11:59 p.m. Eastern Time on May 12, 2021;
•submitting a later-dated vote or another properly executed proxy of a later date prior to the Annual Meeting; or
•voting in person at the Annual Meeting.
Who counts the votes?

We have hired Computershare to count the votes represented by proxies and cast by ballot, and our General Counsel and Corporate Secretary, or other individual as appointed by the Board of Directors, will act as Inspector of Election.
When will we announce the voting results?

We will announce the preliminary voting results at the Annual Meeting. Within four business days of the Annual Meeting, we will report the final results in a Current Report on Form 8-K filed with the SEC, a copy of which will also be posted available on our websites.
Will my shares be voted if I don’t provide my proxy and don’t attend the Annual Meeting?

If you do not provide a proxy or vote your shares held in your name, your shares will not be voted. If you hold your shares in street name, your broker has the authority to vote your shares for “routine” matters even if you do not provide the broker with voting instructions.
Without instructions from you, the broker may not vote on any proposals other than the ratification of Armanino LLP as our independent registered public accounting firm for 2021, which is a routine matter.
What if I am a stockholder of record and return my proxy but don’t vote for some of the matters listed on my proxy card?

If you return a signed proxy card without indicating your vote, your shares will be voted “FOR” the director nominees listed on the card, (Proposal 1), “FOR” the ratification of Armanino LLP as our independent registered public accounting firm (Proposal 2), and “FOR” the advisory vote to approve the compensation of our named executive officers (Proposal 3).
What if I am a beneficial owner and do not give voting instructions to my broker?

As a beneficial owner, in order to ensure your shares are voted in the way you would like, you must provide voting instructions to your bank or broker by the deadline provided in the materials you receive from your bank or broker. If you do not provide voting instructions to your bank or broker, whether your shares can be voted by such person depends on the type of item being considered for vote. Brokers may not vote shares held in street name on non-routine matters unless they have received voting instructions
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from the beneficial owners on how to vote those shares. The ratification of Armanino LLP as our independent registered public accounting firm for 2021 is the only routine matter to be presented at the Annual Meeting on which brokers may vote in their discretion on behalf of beneficial owners who have not provided voting instructions. All other matters are considered “non-routine”.
Could other matters be decided at the Annual Meeting?

We are not aware of any other matters to be presented at the Annual Meeting. If any matters are properly brought before the Annual Meeting, the persons named in your proxies will vote in accordance with their best judgment. Discretionary authority to vote on other matters is included in the proxy.
Do we have a policy about directors’ attendance at the Annual Meeting?

Pursuant to the Corporate Governance Principles, directors are strongly encouraged, but not required, to attend the Annual Meeting. Five of our then-current director nominees attended the 2020 Annual Meeting of Stockholders.
How can I access Immersion Corporation’s proxy materials and annual report electronically?

This proxy statement, the accompanying proxy card and the Annual Report are being made available to our stockholders on the Internet at www.envisionreports.com/IMMR. Most stockholders can elect to view future proxy statements and annual reports over the Internet instead of receiving paper copies in the mail.
If you own Immersion Corporation common stock in your name, you can choose this option and reduce the cost of producing and mailing these documents and help the environment by checking the box for electronic delivery on your proxy card, or by following the instructions provided when you vote by telephone or over the Internet. If you hold your Immersion Corporation common stock through a bank, broker or other holder of record, please refer to the information provided by that entity for instructions on how to elect to view future proxy statements and annual reports over the Internet.
If you choose to view future proxy statements and annual reports over the Internet, you will receive a Notice of Internet Availability next year in the mail containing the Internet address to use to access our proxy statement and annual report. Your choice will remain in effect unless you change your election following the receipt of a Notice of Internet Availability. You do not have to elect Internet access each year. If you later change your mind and would like to receive paper copies of our proxy statements and annual reports, you can request both by following the directions set forth on the Notice of Internet Availability.
Who bears the cost of this proxy solicitation?

The Company will pay the costs of preparing, printing, assembling and mailing the proxy materials used in the solicitation of proxies. Our directors, officers and employees may solicit proxies by mail, by email, by telephone or in person. Those persons will receive no additional compensation for any solicitation activities. We will request banking institutions, brokerage firms, custodians, trustees, nominees and fiduciaries to forward solicitation materials to the beneficial owners of Immersion Corporation common stock held of record by those entities, and we will, upon the request of those record holders, reimburse reasonable forwarding expenses.
How do I submit a proposal for action at the 2022 Annual Meeting of Stockholders?

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A proposal for action to be presented by any stockholder at the 2022 Annual Meeting of Stockholders will be acted upon only:
•if the proposal is to be included in the proxy statement, pursuant to Rule 14a-8 under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), the proposal is received by our Corporate Secretary on or before December 2, 2021;
•if the proposal or a director nomination is not to be included in the proxy statement, pursuant to our Bylaws, the written proposal is delivered to, or mailed and received by, our Corporate Secretary on or before December 2, 2021 and such proposal is, under Delaware General Corporation Law (“Delaware Law”), an appropriate subject for stockholder action and is submitted in accordance with our Bylaws; or
•also in the case of nominating directors, if we increase the number of directors to be elected at our 2022 Annual Meeting of Stockholders and there is no public announcement by us naming all of the nominees for director or specifying the size of the increased Board by November 22, 2021, our Corporate Secretary must receive nominations (but only from a stockholder who had previously submitted in proper form a timely director nomination notice by December 2, 2021) for any new positions created by such increase no later than the close of business on the 10 th calendar day following the day on which such public announcement is first made by us.
In addition, the stockholder proponent, or a representative who is qualified under state law, must appear in person at the 2022 Annual Meeting of Stockholders to present such proposal. Our Bylaws, which are publicly available as an exhibit to the Annual Report, provide detailed information on how to properly submit stockholder proposals and director nominations, and should be read carefully.
Proposals should be sent to our Corporate Secretary, Immersion Corporation, 330 Townsend Street, Suite 234, San Francisco, CA 94107.
How can I view or request copies of our corporate documents and SEC filings?

Our website contains our Certificate of Incorporation, Bylaws, Corporate Governance Principles, Stock Ownership Policy, Board Committee Charters, the Code of Business Conduct and Ethics, Environmental, Social & Governance Statement and our SEC filings. To view these documents, go to ir.immersion.com, click on “Download Library” and click on “Governance.” To view our SEC filings and Forms 3, 4 and 5 filed by our directors and executive officers, go to www.immersion.com/about, click on “Investor Relations” and click on “Financials and Filings.”
We will promptly deliver free of charge a copy of our Annual Report to any stockholder requesting a copy. Requests should be directed to our Corporate Secretary, Immersion Corporation, 330 Townsend Street, Suite 234, San Francisco, CA 94107.
What is householding?

As permitted by the Exchange Act, only one copy of this proxy statement is being delivered to stockholders residing at the same address, unless the relevant stockholders have notified us of their desire to receive multiple copies of the proxy statement. This is known as householding.
We will promptly deliver, upon oral or written request, a separate copy of the proxy statement to any stockholder residing at an address to which only one copy was mailed. Requests for additional copies for the current year or future years should be directed to our Corporate Secretary, Immersion Corporation, 330 Townsend Street, Suite 234, San Francisco, CA 94107.
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Stockholders of record residing at the same address and currently receiving multiple copies of the proxy statement may contact our registrar and transfer agent, Computershare, to request that only a single copy of the proxy statement be mailed in the future. Contact Computershare by phone at (800) 962-4284 or by mail at 462 South 4th Street, Suite 1600, Louisville, KY 40202.
Beneficial owners should contact their broker or bank.
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ELECTION OF DIRECTORS (PROPOSAL 1)
The Board of Directors is elected by the stockholders to oversee their interest in the long-term health and the overall success of our business and its financial strength. The Board serves as our ultimate decision-making body, except for those matters reserved to or shared with the stockholders. The Board selects and oversees the members of senior management, who are charged by the Board with conducting our business.
In the first quarter of 2021, the Board evaluated the size of the Board and whether a seven-person board was necessary or appropriate for the size and scope of the Company. The directors considered the Company’s streamlined operations and footprint, and the fact that, as of February 2, 2021, it had less than 50 full-time employees. The directors also weighed the use of the Company’s cash for director fees, against the Company’s burn rate and operating expenses. In connection with these discussions about right-sizing the Board to better align with the structure of the company, on April 1, 2021, directors Stephen Domenik, Franz Fink, Matthew Frey and Sharon Holt notified the Board that they would decline to stand for re-election at the 2021 Annual Meeting. Furthermore, on April 1, 2021, the Board approved reducing the size of the Board to four directors, effective immediately prior to the start of the 2021 Annual Meeting.
Election Process

In accordance with our Amended and Restated Certificate of Incorporation all directors will be elected at the 2021 Annual Meeting, and each director elected at the 2021 Annual Meeting will hold office until his or her successor is elected and qualified or until his or her earlier death, resignation, or removal. If a quorum is present and voting, the nominees for directors receiving the greatest number of votes will be elected as director. Withheld votes and broker non-votes have no effect on the vote.
Nomination of Directors

The entire Board of Directors is responsible for nominating members for election to the Board and for filling vacancies on the Board that may occur between annual meetings of stockholders, upon the recommendation of the Nominating and Corporate Governance Committee or the independent members of the Board. The Nominating and Corporate Governance Committee is responsible for identifying, screening, and recommending candidates to the entire Board for Board membership. The Nominating and Corporate Governance Committee works with the Board to determine the appropriate characteristics, skills, and experience for the Board as a whole and its individual members. In evaluating the suitability of individual Board members, the Board considers many factors, which are described in further detail below. The Board evaluates each individual in the context of the Board as a whole with the objective of retaining a group of directors with diverse and relevant experience that can best perpetuate our success and represent stockholder interests through sound judgment.
The Nominating and Corporate Governance Committee may seek the input of other members of the Board or management in identifying candidates who meet the criteria outlined above. In addition, the Nominating and Corporate Governance Committee may use the services of consultants or a search firm. The Nominating and Corporate Governance Committee will consider recommendations by our stockholders of qualified director candidates for possible nomination by the Board. Stockholders may recommend qualified director candidates by writing to our Corporate Secretary at Immersion Corporation, 330 Townsend Street, Suite 234, San Francisco, CA 94107. Submissions should include information regarding a candidate’s background, qualifications, experience, and willingness to serve as a director. Based on a preliminary assessment of a candidate’s qualifications, the Nominating and Corporate Governance Committee may conduct interviews with the candidate or request additional information from the candidate. The Nominating and Corporate Governance Committee uses the same process for evaluating all candidates for nomination by the Board, including those recommended by stockholders. Our Bylaws permit persons to be nominated as directors directly by stockholders if certain timing, information and other requirements are met.
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Qualifications of Directors and Nominees

When evaluating potential director nominees, the Nominating and Corporate Governance Committee considers each individual’s professional expertise and educational background in addition to the individual’s general qualifications. The Nominating and Corporate Governance Committee works with the Board to determine the appropriate mix of backgrounds and experiences in order to establish and maintain a Board that is strong in its collective knowledge and that can fulfill its responsibilities and oversee our business consistent with its fiduciary duty to stockholders.
The Nominating and Corporate Governance Committee communicates with the Board to identify backgrounds, qualifications, professional experiences, and areas of expertise that impact our business that are particularly desirable for our directors to possess in order to help meet specific Board needs, including:
•Public company board and corporate governance experience, which provides directors a solid understanding of their extensive and complex oversight responsibilities and furthers our goals of greater transparency and accountability for management and the Board;
•Stockholder alignment, which helps to ensure the Board acts in the best interests of our stockholders;
•Operating experience as current or former executives, which gives directors specific insight, and expertise that will foster active participation in the development of our business strategy and provide the appropriate tools for overseeing the implementation of our operating plan;
•Industry knowledge, especially in our key markets of mobile devices, gaming, VR/AR and automotive, which is vital in understanding and reviewing our strategy;
•Executive leadership experience, which gives directors who have served in significant leadership positions strong abilities to motivate and manage others and to identify and develop leadership qualities in others;
•Accounting and financial expertise, which enables directors to analyze our financial statements and oversee our accounting and financial reporting processes; and
•Technology licensing and IP monetization experience, which is an important component of our business.
The following table highlights each director’s or director nominee’s specific skills, knowledge and experience. A particular director may possess other skills, knowledge or experience even though they are not indicated below.

Director | Industry | Operating | Leadership | Accounting and Financial | Public Company Board/ Corporate Governance | Technology Licensing and IP Monetization
Sumit Agarwal | P | P | P | P |  | P
William Martin | P | P | P | P | P |
Eric Singer | P | P | P | P | P |
Mary Dotz | P | P | P | P | P | P

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The Board does not have a specific diversity policy, but considers diversity of race, ethnicity, gender, age, cultural background and professional experience in evaluating candidates for Board membership. Diversity is important because a variety of perspectives contribute to a more effective decision-making process.
2021 Nominees for Director

Our Board’s nominees for election at the Annual Meeting are Sumit Agarwal, William Martin, Eric Singer and Mary Dotz. If elected, these nominees will hold office until the 2022 Annual Meeting of Stockholders and until his or her successor is elected and qualified.
We have no reason to believe that the nominees listed above will be unable or unwilling to serve if elected. However, if any of these nominees should become unable for any reason or unwilling for good cause to serve, proxies may be voted for another person nominated as a substitute by the Board, or the Board may reduce the number of directors. The Board believes that the nominees’ qualifications, skills and experiences would contribute to an effective and well-functioning Board.
Included in each nominee’s biography below is an assessment of his specific qualifications, attributes, skills, and experience based on the qualifications described above.
There are no family relationships between the nominees, or any directors, or any of our executive officers.
Nominees for Directors – To Be Elected for a Term Expiring in 2022

Sumit Agarwal
Director since 2019
Age: 45
Board Committee(s): Audit, Nominating and Corporate Governance
Education: B.S. in Chemical Engineering from Massachusetts Institute of Technology; Masters from Air Force Academy (Air University)
Professional Experience: Mr. Agarwal is currently Vice-President of Analytic Products at F5 Networks. Prior to that, Mr. Agarwal served from 2011 to 2020 as Co-Founder and ultimately Chief Operating Officer of Shape Security, a security company defending consumer brands in the Fortune 500 from internet fraud and cyber-attacks, which was acquired by F5 Networks. From 2010 to 2011 Mr. Agarwal was with the US Department of Defense where he served as Deputy Assistant to the Secretary of Defense as well as Senior Advisor for Cyber Innovation. From 2003 to 2009, Mr. Agarwal was at Google LLC where he held several product management roles including Head of Mobile Product Management, North America. He held various other roles earlier in his career in technology companies. Mr. Agarwal was also a Reserve Officer in the United States Air Force and retired as a Major.
Director Qualifications: Mr. Agarwal brings to the Board many years of experience in product management which will be invaluable as we begin to focus more of our efforts on delivering technological solutions to our customers.
William Martin
Director since 2019
Age: 43
Board Committee(s): Compensation (Chair), Strategy
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Professional Experience: William C. Martin is Chairman, Chief Investment Officer and Founder of Raging Capital Management, LLC, a private investment partnership based near Princeton, New Jersey that was founded in 2006. Mr. Martin has co-founded a number of financial information companies, including RagingBull.com in 1997 and InsiderScore.com in 2004. He has served on numerous public company boards, including nine years on the board of Bankrate, Inc., a consumer finance company, which was acquired in 2009; the board of Salary.com, Inc., a compensation data, software, consulting and resource company, which was acquired in 2010; and the board of Vitesse Semiconductor Corp., a semiconductor company, which was acquired in 2015.
Director Qualifications: Mr. Martin's extensive experience and successful track record as an investor, entrepreneur and public company director, coupled with his significant financial stake in the Company, will enable him to provide the Board and management with valuable perspectives on executing strategies to maximize stockholder value.
Eric Singer
Director since 2020 and Executive Chairman since 2020
Age: 47
Board Committee(s): Compensation, Strategy
Education: B.A. in History from Brandeis University
Professional Experience: : Mr. Singer has served as a member of our Board of Directors since March 2020, and has served as our Executive Chairman since August 2020. Since July 2019, Mr. Singer has served as a director of A10 Networks (ATEN), an application controller and firewall cloud security company, and has served as its lead independent director since September 2021. Mr. Singer is a founder and Managing Member of VIEX Capital Advisors, a securities investment firm. In addition to a long track record as a successful investor in technology companies, Mr. Singer has substantial experience serving on public boards and in assisting them in creating and expanding shareholder value. Mr. Singer previously served on the boards of directors of Quantum Corporation, a video data storage and management company, Numerex Corp., a provider of managed machine-to-machine enterprise solutions enabling the Internet of Things, RhythmOne plc and YuMe, Inc., each a provider of brand video advertising software and audience data, Support.com, Inc., a provider of tech support and support center services, Meru Networks, Inc., a Wi-Fi network solutions company, PLX Technology, Inc., a PCI Express and ethernet semiconductor company, and Sigma Designs, Inc., an integrated circuit provider for the home entertainment market, among other companies. Mr. Singer has a B.A. from Brandeis University. Mr. Singer has specific attributes that qualify him to serve as a member of our board of directors, including his extensive financial and operating experience and knowledge of the technology industry gained through his service on numerous public company boards.
Director Qualifications: Mr. Singer’s extensive public company board experience enables him to contribute significantly to our Board.
Mary Dotz
Age: 62
Education: B.S. in Business Administration from San Diego State University and a M.B.A. from University of Southern California
Professional Experience: Mary L. Dotz has been the Chief Operating Officer, Chief Financial Officer, and a member of the Board of Directors of Twist Investment Corporation since its inception. Ms. Dotz has over 30 years of business experience as a senior finance executive and board member, including senior management positions at several public companies. Currently, Ms. Dotz is a member of the Board of Directors of A10 Networks (NYSE: ATEN), a provider of secure application solutions securing customers’ applications across multi-cloud networks. Ms. Dotz has served as an independent business
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advisor to public and private technology companies since December 2013. In connection with such advisory services, from August 2019 to July 2020, Ms. Dotz served as Interim Chief Financial Officer of Anatomage, a pioneer in 3D anatomy visualization. From March 2012 to November 2013, Ms. Dotz served as Chief Financial Officer of Alpha and Omega Semiconductor Inc. (NASDAQ: AOSL), a global supplier of power semiconductors. Prior to joining Alpha and Omega Semiconductor Inc., Ms. Dotz, served as Chief Financial Officer of Adaptec, Inc. (formerly, NASDAQ: ADPT), a global provider of data center storage solutions, from March 2008 until May 2011 following its acquisition. Ms. Dotz served as Chief Financial Officer of Beceem Communications, Inc., a wireless base station provider, from October 2005 to March 2008. In addition, Ms. Dotz served as Chief Financial Officer of Pinnacle Systems, Inc. (formerly, NASDAQ: PCLE), a supplier of digital video products, from January 2005 until August 2005 until it was acquired. From October 2000 to January 2005, Ms. Dotz held management positions in finance, including Interim Chief Financial Officer, Corporate Controller and Vice President Finance, at NVIDIA Corporation (NASDAQ: NVDA), a global semiconductor company. Ms. Dotz also previously held finance positions at Advanced Micro Devices, Inc. (NASDAQ: AMD), Nissan North America, Inc. (OTC: NSANY) and Unocal Corporation (formerly, NYSE: UCL). Ms. Dotz holds a Bachelor of Science degree in Business Administration from San Diego State University and a Master of Business Administration degree from the University of Southern California.
Director Qualifications: Ms. Dotz’s significant financial and management experience makes her well qualified to serve as a member of our Board of Directors.
The Board of Directors recommends a vote FOR the election of Messrs. Agarwal, Martin and Singer and Ms. Dotz, as directors.
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DIRECTOR COMPENSATION
The Compensation Committee is responsible for reviewing and making recommendations to the Board regarding all matters pertaining to compensation paid to directors for Board, committee and committee chair services. Under the Compensation Committee charter, the Compensation Committee is authorized to engage consultants or advisors in connection with its review and analysis of director compensation. In 2020, the Compensation Committee engaged an independent compensation consultant, Compensia, Inc., in its review and analysis. Directors who also serve as our employees do not receive payment for services as directors.
2020 Annual Compensation

Cash Compensation
In 2020, our policy was that non-employee directors each received an annual retainer fee of $25,000, paid in quarterly installments on the date of each quarterly Board meeting. In addition, the Chairman of our Board received a retainer fee of $20,000. The Chairman of our Audit Committee received a $14,000 annual committee fee, the Chairman of our Compensation Committee received an $8,000 annual committee fee, and the Chairman of our Nominating and Corporate Governance Committee received a $3,000 annual committee fee. The other members of our Audit and Compensation Committees each received a $3,000 annual committee fee and the other members of our Nominating and Corporate Governance Committee each received a $2,000 annual committee fee. These annual committee fees are paid in quarterly installments on the date of the quarterly Board meetings. Fees for partial year service are pro-rated. Directors are entitled to reimbursement of reasonable travel expenses (as set forth in the Company’s Travel and Expense Reimbursement Policy) they incur in connection with attending Board and committee meetings.
As disclosed in the Company’s Form 8-K, filed with the SEC on April 7, 2020, the Board enacted a 25% reduction in each director’s cash compensation for service on the Board and each of its committees, with such reduction effective April 1, 2020. This reduction was part of broader cash conservation efforts to mitigate the impact of the COVID-19 pandemic on the Company.
On August 4, 2020, the Board appointed Mr. Singer to the role of Executive Chairman. In connection with Mr. Singer’s appointment, on November 10, 2020, the Compensation Committee approved additional compensation for the Executive Chairman in the amount of $10,000 per month, effective August 4, 2020. Mr. Singer was not present during the discussion or approval of the additional compensation.
Equity Compensation
Upon the commencement of each non-employee director’s service on the board and at each annual stockholder meeting thereafter (if they serve on the Board at such time), each non-employee director receives an annual grant of restricted stock awards (“RSAs”) having a value equal to $125,000 on the date of the annual stockholder meeting, 100% of which vests on the earlier of: (i) the one-year anniversary of the date of grant of the RSA, and (ii) the date of the next annual stockholders’ meeting, provided that such annual stockholders’ meeting is at least 50 weeks apart from the previous annual stockholders’ meeting. If a director commences service between the annual stockholder meetings, the director receives a prorated initial equity grant based on the number of days before the next annual stockholder meeting. The RSAs fully vest on a corporate transaction (as defined in the 2011 Equity Incentive Plan).
On February 10, 2021, the Compensation Committee amended the vesting terms of RSAs granted to non-employee directors such that vesting of future grants will occur at the earlier of: (i) the one-year
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anniversary of the date of grant of the RSA, and (ii) immediately prior to the next annual stockholders’ meeting.
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2020 Director Compensation Table

The following table sets forth information concerning the compensation earned during 2020 by each non-executive director who served during the year ended December 31, 2020:

Director | Fees Earned or Paid in Cash(1) ($) | Stock Awards(2) ($) | Option Awards(2) ($) | Total ($)
Sumit Agarwal(3) | 23,961 |  | 120,993 |  | — | 144,954 |
Matthew Frey(4) | 31,688 |  | 120,993 |  | — | 152,681 |
Sidney Ganis(5) | 130,081 |  | — |  | — | 130,081 |
Sharon Holt(6) | 33,343 |  | 120,993 |  | — | 154,336 |
William Martin(7) | 27,226 |  | 120,993 |  | — | 148,219 |
Jonathan Visbal(8) | 130,833 |  | — |  | — | 130,833 |
Stephen Domenik(9) | 18,785 |  | 143,908 |  | — | 162,693 |
Eric Singer(10) | 72,586 |  | 143,908 |  | — | 216,494 |
Franz Fink(11) | 17,425 |  | 143,908 |  | — | 161,333 |

(1) Consists of meeting fees earned in 2020 for service as a member of our Board. Fees earned by directors vary depending on the number of committees on which the director served and whether the director was Chairman of our Board or served as chair of certain committees. See “2020 Annual Compensation-Cash Compensation” above for more information.
(2) Represents the grant date fair value of each stock award granted in 2020 in accordance with Financial Accounting Standard Board’s Accounting Standards Codification Topic 718 (FASB ASC Topic 718), disregarding for this purpose the estimate of forfeitures related to service-based vesting conditions. For a discussion of assumptions used to calculate the FASB ASC Topic 718 grant date fair value, refer to Note 6 (Stock-based Compensation) to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020. See “2020 Annual Compensation-Equity Compensation” above for more information.
(3) Mr. Agarwal was granted 18,543 RSAs (with a grant date fair value equal to $120,993) in accordance with the Company’s director compensation policy.
(4) Mr. Frey was granted 18,543 RSAs (with a grant date fair value equal to $120,993) in accordance with the Company’s director compensation policy.
(5) Mr. Ganis was granted 15,923 RSAs (with a grant date fair value equal to $115,760) in June 2019; however, these were cancelled as of his resignation date of March 8, 2020 and he was instead paid $125,000 in cash for his service, which amount is also reflected in Immersion’s Proxy Statement filed with the SEC on April 23, 2020.
(6) Ms. Holt granted 18,543 RSAs (with a grant date fair value equal to $120,993) in accordance with the Company’s director compensation policy.
(7) Mr. Martin was granted 18,543 RSAs (with a grant date fair value equal to $120,993) in accordance with the Company’s director compensation policy.
(8) Mr. Visbal was granted 15,923 RSAs (with a grant date fair value equal to $115,760) in June 2019; however, these were cancelled as of his resignation date of March 8, 2020 and he was instead paid $125,000 in cash for his service, which amount is also reflected in Immersion’s Proxy Statement filed with the SEC on April 23, 2020.
(9) Mr. Domenik was granted 4,220 RSAs (with a grant date fair value equal to $22,915) in March 2020 upon his appointment to the Board on March 9, 2020 and 18,543 RSAs (with a grant date fair value equal to $120,993) in June 2020 upon his election at the 2020 Annual Meeting in accordance with the Company’s director compensation policy.
(10) Mr. Singer was granted 4,220 RSAs (with a grant date fair value equal to $22,915) in March 2020 upon his appointment to the Board on March 9, 2020 and 18,543 RSAs (with a grant date fair value equal to $120,993) in June 2020 upon his election at the 2020 Annual Meeting in accordance with the Company’s director compensation policy.
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(11) Mr. Fink was granted 4,220 RSAs (with a grant date fair value equal to $22,915) in March 2020 upon his appointment to the Board on March 9, 2020 and 18,543 RSAs (with a grant date fair value equal to $120,993) in June 2020 upon his election at the 2020 Annual Meeting in accordance with the Company’s director compensation policy.
Director Stock Ownership Guidelines
We have established stock ownership guidelines to further align our non-employee directors’ interests with those of our stockholders. The guidelines require each non-employee director to acquire and hold shares of our common stock equal in value to three times the non-employee directors’ annual cash retainer. Each non-employee director must meet such requirement prior to the five-year anniversary of the date he or she joins the Board.
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CORPORATE GOVERNANCE
We are committed to good corporate governance, which promotes the long-term interests of stockholders, strengthens Board and management accountability and helps build public trust. The Board of Directors has established Corporate Governance Principles which provide a framework for our effective governance. The principles address matters such as the director responsibilities, director qualifications, determination of director independence, Board committee structure, Chief Executive Officer performance evaluation and management succession. The Board regularly reviews developments in corporate governance and updates the Corporate Governance Principles and other governance materials as it deems necessary and appropriate.
The corporate governance section of our website makes available our corporate governance materials, including the Corporate Governance Principles, our Stock Ownership Policy, the charters for each Board committee and our Code of Business Conduct and Ethics. To access these documents on our website, https://ir.immersion.com/corporate-governance.
Board Leadership Structure

Our Board has determined that having an independent director serve as Executive Chairman of our Board is in our best interests and those of our stockholders. This Board structure enhances the independence of our Board from our management by ensuring a greater role for the independent directors in our oversight and active participation of the independent directors in setting agendas and establishing priorities and procedures for our Board. In addition, separating these roles allows our Chief Executive Officer to focus his efforts on running our business and managing our day-to-day operations, while allowing our Board to benefit from our Executive Chairman’s extensive experience serving on public boards and in creating and expanding shareholder value. Every regular meeting of our Board includes a meeting of our independent non-executive directors without management present.

Board Leadership Structure •Executive Chairman of the Board: Eric Singer •All of our non-employee directors are independent

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Independence of Directors

In accordance with the standards for independence set forth in the rules of The Nasdaq Stock Market, our Board has determined that each of the members of our Board has no relationship that would interfere with the exercise of independent judgment in carrying out his or her responsibilities as a director and is otherwise “independent” in accordance with the applicable rules of The Nasdaq Stock Market.
Risk Management

Our Board recognizes the importance of effective risk oversight in running a successful business and in fulfilling its fiduciary responsibilities for us and our stockholders. Consistent with our Board leadership structure, our Chief Executive Officer and other members of our executive team are responsible for the day-to-day management of risk, while our Board is responsible for ensuring that we have an appropriate culture of risk management, set the right “tone at the top,” oversee our aggregate risk profile and assist management in addressing specific risks.
Our Board exercises its oversight responsibility for risk both directly and through its standing committees. Strategic, operational and competitive risks also are presented and discussed at our Board’s quarterly meetings, and more often as needed. On at least an annual basis, our Board conducts a review of our long-term strategic plans and members of our executive team report on our top risks and the steps management has taken or will take to mitigate these risks. On a regular basis between Board meetings, our Chief Executive Officer provides updates to the Board on the critical issues we face and recent developments in our principal markets.

Risk Management •Our Board oversees risk management. •Our Board and standing committees spend a portion of their time reviewing and discussing specific risk topics. •Company management is charged with managing risk through internal processes and controls.

Our Audit Committee is responsible for reviewing our risk management framework and programs, as well as the framework by which management discusses our risk profile and risk exposures with our full Board and its committees. Our Audit Committee meets regularly with our Chief Financial Officer, our independent auditor, our General Counsel, and other members of senior management to discuss our major financial risk exposures, financial reporting, internal controls, credit and liquidity risk, compliance risk, key operational risks, cybersecurity risk and our risk management framework and programs. Other responsibilities include at least annually reviewing the implementation and effectiveness of our compliance and ethics program and our business continuity plan and test results. Our Audit Committee meets regularly in separate executive sessions with the independent auditor, as well as with Audit Committee members only, to facilitate a full and candid discussion of risk and other issues.
Our Compensation Committee is responsible for overseeing human capital and compensation risks, including evaluating and assessing risks arising from our compensation policies and practices for all employees and ensuring executive compensation is aligned with performance. Our Compensation Committee also is charged with monitoring our incentive and equity-based compensation plans, including
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employee benefit plans. For additional information regarding the Compensation Committee’s review of compensation-related risk, please see the section of this proxy statement entitled “Compensation Discussion and Analysis—Risk Assessment of Compensation Programs.”
Our Nominating and Corporate Governance Committee oversees risks related to our overall corporate governance, including Board and committee composition, Board size and structure, director independence, and our corporate governance profile and ratings. Our Nominating and Corporate Governance Committee also is actively engaged in overseeing risks associated with succession planning for our Board and management.
Our Strategy Committee provides assistance to our Board in various matters, including fulfilling its responsibilities with respect to reviewing, evaluating and making recommendations to the Board regarding the Company’s corporate strategy, capital allocation, cost structure, business opportunities and related matters.
Our Board believes that one of its primary responsibilities is to oversee the development and retention of executive talent and to ensure that an appropriate succession plan is in place for our Chief Executive Officer and other members of management. Each year, the Nominating and Corporate Governance Committee meets with our Human Resources department and our executives to discuss management succession planning and to address potential vacancies in senior leadership. The Nominating and Corporate Governance Committee also annually reviews with the Board succession planning for our Chief Executive Officer. In addition to executive and management succession, the Nominating and Corporate Governance Committee regularly oversees and plans for director succession and refreshment of the Board to ensure a mix of skills, experience, tenure, and diversity that promote and support our long-term strategy. In doing so, the Nominating and Corporate Governance Committee takes into consideration the overall needs, composition and size of the Board, as well as the criteria adopted by the Board regarding director candidate qualifications. Individuals identified by the Nominating and Corporate Governance Committee as qualified to become directors are then recommended to the Board for nomination or election.
Company Policies

Our Board has adopted several policies governing directors, employees, and/or officers: (i) the Code of Business Conduct and Ethics that outlines the principles of legal and ethical business conduct, which was updated as of September 2020; (ii) the Stock Ownership Policy, which requires our executives and non-employee directors to have a direct ownership in Immersion’s common stock; (iii) the Insider Trading Policy, which outlines the procedures and guidelines governing securities trades by our employees; and (iv) the Immersion Environmental and Social Policy.
The Code of Business Conduct and Ethics is applicable to all of our directors, employees, and officers and is available on our website at https://ir.immersion.com/corporate-governance. Any substantive amendment or waiver of this policy may be made only by our Board upon a recommendation of the Audit Committee and, as required by applicable SEC rules, we intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K by disclosing such information on our website.
The Stock Ownership Policy is applicable to our executives and non-employee directors and is available on our website at https://ir.immersion.com/corporate-governance. This policy requires that these individuals hold stock equal in value to, in the case of our CEO and non-employee directors, three times, and our other executives, one times, the amount of their annual cash retainer/base salary. This is calculated once a year and there is a five-year period in which to comply. If it is determined that a particular person does not comply with the policy, the individual will be notified and will be required to retain 50% of the net shares received as a result of any exercise, vesting or payment of any equity awards until he or she becomes compliant.
The Insider Trading Policy applies to all of our current and former employees, directors, independent contractors, agents and consultants. The Insider Trading Policy prohibits short sales, the buying or selling
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of puts, calls or other derivative or similar securities of the Company or engaging in any other hedging transaction, using the Company’s securities as collateral in a margin account, or pledging the Company’s securities as collateral for a loan (or modifying an existing pledge).
Communications by Stockholders with Directors

Stockholders may communicate with any and all directors by transmitting correspondence by mail, facsimile, or e-mail, addressed as follows: Board or individual director, c/o Corporate Secretary, Immersion Corporation, 330 Townsend Street, Suite 234, San Francisco, CA 94107; Fax: (408) 467-1901; E-mail Address: corporate.secretary@immersion.com. Our Corporate Secretary will maintain a log of such communications and transmit as soon as practicable such communications to the identified director addressee(s). The acceptance and forwarding of a communication to any director does not imply that the director owes or assumes any fiduciary duty to the person submitting the communication, all such duties being only as prescribed by applicable law.
Board Meetings and Committees of the Board

Attendance at Board, Committee and Annual Stockholder Meetings
Our Board and its committees meet throughout the year on a set schedule, hold special meetings as needed, and act by written consent from time to time. The Board met eleven times during 2020. Each director attended at least 75% of the meetings of the Board and of any committees of the Board on which he serves. The total number of meetings held by each committee is set forth below under “Committees of the Board.”
We make every effort to schedule our annual meeting of stockholders at a time and date to accommodate attendance by directors, taking into account the directors’ schedules. All directors are encouraged to attend the annual meeting of stockholders. Five (5) of our then-current director nominees attended our 2020 annual meeting of stockholders.
Executive Sessions of the Board
The non-executive members of our Board and all committees of our Board meet in executive session without management present at each regularly scheduled in-person Board and committee meeting.
Committees of the Board
The Board has a separately-designated standing Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee, and Strategy Committee.
The Board has also adopted a written charter for each of the Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee. Each written charter is available on our website at https://ir.immersion.com/corporate-governance.
In each case, our Board has delegated the responsibilities set forth below to the respective committee; however, our Board may from time to time, perform the duties itself.
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The table below provides current membership (M) and chairmanship (C) information for each standing committee.

Name | Audit | Compensation | Nominating and Corporate Governance | Strategy Committee
Sumit Agarwal | M |  | M |
Stephen Domenik |  | M | C | M
Franz Fink | M |  |  |
Matthew Frey | C |  |  |
Sharon Holt |  |  | M |
William Martin |  | C |  | M
Eric Singer |  | M |  | M

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Audit Committee and Audit Committee Financial Expert

Members: |  | Mathew Frey (Chairman) Franz Fink Sumit Agarwal
Number of Meetings in Fiscal Year 2020: |  | 8
Independence: |  | Our Board has determined that each member of the Audit Committee meets the independence criteria set forth in the applicable rules of The Nasdaq Stock Market and the SEC for Audit Committee membership.
Financial Expert: |  | Our Board has determined that all members of the Audit Committee possess the level of financial literacy required by applicable Nasdaq Stock Market and SEC rules and that in accordance with section 407 of the Sarbanes-Oxley Act of 2002, at least one member of the Audit Committee, Mr. Frey, is an “audit committee financial expert,” as defined in the rules of the SEC.
Responsibilities: |  | Our Audit Committee provides assistance to our Board in various matters, including fulfilling its responsibilities with respect to the following: •retaining, overseeing, compensating, communicating with, determining the independence of, and, if necessary, terminating and replacing our independent registered public accounting firm; •reviewing the scope of audit and pre-approving permissible non-audit services by our independent registered public accounting firm; •reviewing the accounting principles and auditing practices and procedures to be used for our financial statements and related disclosures; •preparing the audit committee report to be included in our annual proxy statement as required by the SEC; •overseeing cybersecurity initiatives; •overseeing procedures for the treatment of complaints on accounting, internal controls, or audit matters; •reviewing the results of the audits of our financial statements; •reviewing risk management framework and programs; and •reviewing related party transactions.

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Compensation Committee

Members: |  | William Martin (Chairman) Eric Singer Stephen Domenik
Number of Meetings in Fiscal Year 2020: |  | 4
Independence: |  | Our Board has determined that each member of the Compensation Committee meets the independence criteria set forth in the applicable Nasdaq Stock Market rules as a “non-employee director,” as defined in Rule 16b-3 under Section 16 of the Exchange Act.
Responsibilities: |  | Our Compensation Committee provides assistance to our Board in various matters, including with respect to the following: •overseeing our general compensation structure, policies and programs, and assessing whether our compensation structure establishes appropriate incentives for management and employees and properly aligning executive compensation with stockholder interests and business performance; •making recommendations to the Board with respect to and administration of our equity-based compensation plans, including our equity incentive plans and employee stock purchase plan; •reviewing the “Compensation Discussion and Analysis” to be included in the Company’s public filings; •reviewing and approving compensation packages for our executive officers; •reviewing and approving employment and retention agreements and severance arrangements for executive officers, including change-in-control provisions, plans or agreements; and •reviewing the compensation of directors for service on the Board and its committees and recommending changes in compensation to the Board. Other than the delegation to the Chief Executive Officer of the authority to grant awards under certain equity plans pursuant to guidelines set by the Board, our Compensation Committee has not delegated any of its duties under its charter. The Compensation Committee may, however, from time to time, delegate duties or responsibilities to subcommittees or to one member of the Compensation Committee.

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Nominating and Corporate Governance Committee

Members: |  | Stephen Domenik (Chairman) Sharon Holt Sumit Agarwal
Number of Meetings in Fiscal Year 2020: |  | 3
Independence: |  | Our Board has determined that each member of the Nominating and Corporate Governance Committee meets the criteria for independent Board members set forth in the applicable Nasdaq Stock Market rules.
Responsibilities: |  | Our Nominating and Corporate Governance Committee provides assistance to our Board in various matters, including fulfilling its responsibilities with respect to the following: •identifying, evaluating, recruiting, and recommending candidates for Board positions to our Board and recommending to our Board policies on Board and committee composition and criteria for Board membership; •recommending to our Board, and reviewing on a periodic basis, our succession plan, including policies and principles for selection and succession of the Chief Executive Officer in the event of an emergency or the resignation or retirement of our Chief Executive Officer; •reviewing the independence of each director; •periodically reviewing policies and the compliance of senior executives with respect to these policies; •reviewing our compliance with corporate governance listing requirements of The Nasdaq Stock Market; and •assisting our Board in developing criteria for the annual evaluation of our Chief Executive Officer, director and committee performance.

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Strategy Committee

Members: |  | Eric Singer William Martin Stephen Domenik
Number of Meetings in Fiscal Year 2020: |  | 8
Independence: |  | Our Board has determined that each member of the Strategy Committee meets the criteria for independent Board members set forth in the applicable Nasdaq Stock Market rules.
Responsibilities: |  | Our Strategy Committee provides assistance to our Board in various matters, including fulfilling its responsibilities with respect to the following: · •reviewing, evaluating and making recommendations to the Board regarding the Company’s corporate strategy, capital allocation, cost structure, business opportunities and related matters.

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RELATED PERSON TRANSACTIONS
In accordance with our Audit Committee charter, our Audit Committee is responsible for reviewing and approving the terms and conditions of any related party transactions. Review of any related party transaction would include reviewing each such transaction for potential conflicts of interests and other improprieties. Except as described in “Director Compensation” above and in “Executive Compensation” below, since January 1, 2020, there has not been, nor is there currently proposed, any transaction or series of similar transactions, to which we are or were a party, in which the amount involved exceeds $120,000 and in which any of our directors, executive officers, or holders of more than 5% of our capital stock, or any of the immediate family members of such persons, had or will have a direct or indirect material interest.
In addition to indemnification provisions in our Bylaws, we have entered into agreements to indemnify our directors and executive officers. These agreements provide for indemnification of our directors and executive officers for certain types of expenses, including attorneys’ fees, judgments, fines, and settlement amounts incurred by persons in any action or proceeding, including any action by us or in our right, arising out of their services as our director or executive officer. We believe that these provisions and agreements are necessary to attract and retain qualified persons as directors and executive officers.
Interest of Certain Persons in Matters to Be Acted Upon
No person who has served as an officer or director of the Company since January 1, 2020 nor any director nominee, and no associate of such a person, has any substantial interest in the matters to be acted upon at the Annual Meeting, other than (i) as a result of his or her role as an officer or director of the Company, or (iii) in his or her role as a shareholder in proportion to his or her percentage shareholding.
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OWNERSHIP OF OUR EQUITY SECURITIES
Directors and Executive Officers

The following table sets forth information regarding beneficial ownership of Immersion Corporation common stock by each director, each director nominee, each individual named in the 2020 Summary Compensation Table on page 51, and our directors, director nominees and executive officers as a group, all as of March 19, 2021. Unless otherwise noted, voting power and investment power in Immersion Corporation common stock are held solely by the named person. The address of each of the individuals named below is c/o Immersion Corporation, 330 Townsend Street, Suite 234, San Francisco, CA 94107.

Name | Aggregate Number of Shares Beneficially Owned | Percent of Outstanding Shares(1) | Additional Information
Sumit Agarwal(2) | 45,466 |  | * |
Stephen Domenik(3) | 22,763 |  | * |
Franz Fink(4) | 22,763 |  | * |
Matthew Frey(5) | 32,030 |  | * |
Ramzi Haidamus(6) | 65,008 |  | * |
Sharon Holt(7) | 51,390 |  | * |
William Martin(8) | 2,254,119 |  | 7.3% |
Michael Okada(9) | 32,067 |  | * |
Aaron Akerman(10) | 52,388 |  | * |
Eric Singer(11) | 521,642 |  | 1.7% |
Jared Smith(12) | 67,909 |  | * |
Len Wood | — |  | * |
Mary Dotz | — |  | * |
All directors, director nominees and executive officers as a group (15 persons) | 3,167,545 |  | 10.2% |

* Less than 1% of issued and outstanding shares of Immersion Corporation common stock.
(1) Calculated on the basis of 30,867,177 shares of common stock outstanding as of March 19, 2021, provided that any additional shares of common stock that a stockholder has the right to acquire within 60 days after March 19, 2021 are deemed to be outstanding for the purpose of calculating that stockholder’s percentage of beneficial ownership.
(2) Consists of (i) 26,923 shares of common stock and (ii) 18,543 RSAs.
(3) Consists of (i) 4,220 shares of common stock and (ii) 18,543 RSAs.
(4) Consists of (i) 4,220 shares of common stock and (ii) 18,543 RSAs.
(5) Consists of (i) 13,487 shares of common stock and (ii) 18,543 RSAs.
(6) Consists of 65,008 shares of common stock.
(7) Consists of 51,390 shares of common stock.
(8) Consists of (i) 2,235,576 shares of common stock and (ii) 18,543 RSAs. Includes common stock held directly by Raging Capital Master Fund, Ltd. ("Raging Master"). Raging Capital Management, LLC ("Raging Capital") is the Investment Manager of Raging Master. William C. Martin is the Chairman, Chief Investment Officer and Managing Member of Raging Capital. William Martin may be deemed to beneficially own the securities held by Raging Master and Raging Capital.
(9) Consists of (i) 21,817 shares of common stock, (ii) options to purchase 3,417 shares of common stock and (iii) options to purchase 6,833 shares of common stock subject to vesting conditions expected to occur within 60 days of March 19, 2021.
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(10) Consists of (i) 5,722 shares of common stock, (ii) options to purchase 40,833 shares of common stock and (iii) options to purchase 5,833 shares of common stock subject to vesting conditions expected to occur within 60 days of March 19, 2021.
(11) Consists of (i) 503,099 shares of common stock and (ii) 18,543 RSAs. Includes common stock beneficially owned directly by VIEX Opportunities Fund, LP - Series One (“Series One”). VIEX GP, LLC, as the general partner of Series One, may be deemed the beneficial owner of the shares of common stock beneficially owned by Series One. VIEX Capital Advisors, LLC, as the investment manager of Series One, may be deemed the beneficial owner of the shares of common stock beneficially owned by Series One. Mr. Singer, as the managing member of each of VIEX GP, LLC, and VIEX Capital Advisors, LLC, may be deemed the beneficial owner of the shares of Common Stock beneficially owned by Series One.
(12) Consists of (i) 26,034 shares of common stock, (ii) options to purchase 35,625 shares of common stock and (iii) options to purchase 6,250 shares of common stock subject to vesting conditions expected to occur within 60 days of March 19, 2021.
Principal Stockholders

Set forth in the table below is information about the number of shares held by persons we know to be the beneficial owners of more than 5% of the issued and outstanding Immersion Corporation common stock. Unless otherwise noted, to our knowledge, voting power and investment power in Immersion Corporation common stock are held solely by the named entity.

Name and Address | Aggregate Number of Shares Beneficially Owned | Percent of Outstanding Shares(1) | Additional Information
Raging Capital Management, LLC Ten Princeton Ave., P.O. Box 228 Rocky Hill, NJ 08553 | 2,254,119 | 7.3% | Based solely on a Schedule 13D/A filed with the SEC on March 11, 2021, Raging Capital Management LLC and William C. Martin have shared voting and dispositive power with respect to 2,222,089 shares, and William C. Martin has sole voting power with respect to 32,030 shares.
Acacia Research Corporation 4 Park Plaza, Suite 550 Irvine, CA 92614 | 1,533,991 | 5.0% | Based solely on a Schedule 13D/A filed with the SEC on December 26, 2019, Acacia Research Corporation has sole voting and disposition power with respect to 1,533,991 shares.

(1) Calculated on the basis of 30,867,177 shares of common stock outstanding as of March 19, 2021.
Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act requires executive officers and directors and persons who beneficially own more than 10% of our common stock (the “Reporting Persons”) to file initial reports of ownership and reports of changes in ownership with the SEC. Reporting Persons are required by SEC rules to furnish the Company with copies of all Section 16(a) forms they file. Based solely on a review of the copies of such forms furnished to the Company and written representations from the executive officers and directors, the Company believes that the Reporting Persons complied with all Section 16(a) filing requirements since January 1, 2020, except that Mr. Fink filed late reports on Forms 3 and 4 with respect to his appointment as a director and his initial RSA grant in connection with such appointment.
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EXECUTIVE OFFICERS

This section includes biographical information for our current executive officers.

Name | Age | Positions | Officer Since
Michael Okada | 56 | General Counsel and Senior Vice President, IP Licensing and Legal Affairs | 2019
Jared Smith | 59 | Interim Chief Executive Officer and Vice President, Worldwide Sales | 2019
Aaron Akerman | 52 | Chief Financial Officer and Treasurer | 2020

Michael Okada
Education: J.D. from the University of Southern California and an A.B. in Economics from Columbia University
Professional Experience: Prior to joining Immersion Corporation in May 2019, Mr. Okada held the position of Vice President, IP Transactions and Legal Affairs, at Dolby Laboratories, Inc., an audio, visual and voice technologies company, from December 2006 to May 2019, where he led a global team supporting the company’s audio and imaging technology businesses. Prior to working at Dolby, Mr. Okada was a partner at Wilson, Sonsini, Goodrich & Rosati from 1994-2006 where he was a member of the firm's Technology Transactions Group where his practice focused on domestic and international intellectual property and commercial transactions.
Jared Smith
Education: M.B.A. from Santa Clara University and a BSChE in Chemical Engineering from the University of Michigan.
Professional Experience: Prior to joining Immersion Corporation in June 2019, Mr. Smith held the position of Vice President, Strategic Alliances, at Arm Limited, a semiconductor and software design company, from March 2016 to May 2019. Prior to working at Arm, Mr. Smith held the position of Vice President, Business Development, at Pelican Imaging Corporation, a camera technology company, from January 2013 until July 2015. From 2001 to 2012, Mr. Smith held the position of Vice President of Licensing & Business Development at Rambus Incorporated, a semiconductor IP company.
Aaron Akerman
Education: Bachelor of Commerce, Finance and Accounting and a Graduate Diploma in Public Accountancy from McGill University
Professional Experience: Prior to joining Immersion Corporation in January 2020, Mr. Akerman was CFO of Hypertec Group, a global provider of IT solutions, products and services from May 2019 to January 2020 and VP of Finance of Hypertec Group from November 2017 to May 2019. From February 2010 to October 2016, Mr. Akerman served as CFO of Lasik MD Group, a provider of laser vision correction services. As CFO of Lasik MD Group, Mr. Akerman played an active role in the M&A team, including overseeing the completion of several acquisitions. From 2003 to 2009, Mr. Akerman served as the VP of Finance of OZ Communications Inc., a developer of mobile messaging software. Mr. Akerman is also a Chartered Professional Accountant and CFA® charterholder.
CFA® is a registered trademark owned by CFA Institute.
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COMPENSATION DISCUSSION AND ANALYSIS
In this Compensation Discussion and Analysis (“CD&A”), we summarize our objectives regarding the compensation of our named executive officers, including how we determine the elements and amounts of their compensation. Included below are discussions regarding how our executive compensation program ties to our strategic goals and objectives and supports stockholder value creation. Specifically, we will discuss our compensation philosophy (including our pay-for-performance philosophy), our compensation approach, our compensation determinations and our policies and practices related to executive compensation. Our executive compensation program reflects a commitment to:
•align compensation with our annual and long-term business objectives and performance;
•enable us to attract, retain and reward executive officers and other key employees who contribute to our long-term success;
•motivate our executive officers to enhance long-term stockholder value; and
•position us competitively among the companies against which we recruit and compete for talent..
Our named executive officers for fiscal 2020 were as follows:

Name | Title
Jared Smith(1) | Interim Chief Executive Officer and Vice President, Worldwide Sales
Aaron Akerman(2) | Chief Financial Officer
Michael Okada | General Counsel and Senior Vice President, IP Licensing and Legal Affairs
Ramzi Haidamus(3) | Former Chief Executive Officer
Len Wood(4) | Former Interim Chief Financial Officer

(1) Mr. Smith was appointed Interim Chief Executive Officer effective November 3, 2020.
(2) Mr. Akerman was appointed Chief Financial Officer effective January 13, 2020.
(3) Mr. Haidamus resigned as Chief Executive Officer effective November 3, 2020, at which time Jared Smith, Vice President, Worldwide Sales, was appointed Interim Chief Executive Officer.
(4) Mr. Wood served as Interim Chief Financial from July 30, 2019 through January 13, 2020 at which point Aaron Akerman was appointed Chief Financial Officer.
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Executive Summary

The past year was a pivotal time for Immersion’s transition. We have had change at the top of the organization including the appointment of our Interim Chief Executive Officer in late 2020 and our Chief Financial Officer joining in early 2020. We have an opportunity for our talented team to capitalize on our intellectual property assets and lead the widespread adoption of touch feedback and related technologies in a broad array of products and markets.
As will be shown throughout this CD&A, the Board and the Compensation Committee made difficult compensation-related decisions in this transitional year. We believe that the decisions made were not only appropriate for our circumstances but also have enabled Immersion to stabilize and retain a talented management team to lead our growth going forward.
Shareholder Feedback and Executive Compensation Re-Design
Beyond communicating our perspectives, we also believe in the value of listening to our shareholders. Over the past several years, feedback from shareholders has helped the Board evaluate and improve Immersion’s executive compensation program. Each year, we conduct outreach to shareholders to receive feedback on matters regarding our executive compensation and corporate governance practices. T hroughout the year our CFO also engages with our shareholders, frequently along with our CEO. Additionally, our two largest shareholders (as of April 7, 2020) are represented on our Compensation Committee and have played a significant role in re-designing our compensation practices.
To communicate broadly with our shareholders, we also seek to transparently share information relevant to our shareholders through our Investor Relations website, our Annual Report, and this Proxy Statement.
During fiscal year 2020, our Board and members of management engaged with a cross-section of shareholders to solicit meaningful feedback on our executive compensation program. Based on the feedback received, we concluded that the following two items were of most concern to our shareholders:
•The allocation of equity grants among performance shares, stock options and restricted stock units; and
•A lack of alignment between total shareholder returns and our incentive awards.
Considering this feedback and the results of the advisory vote on executive compensation at our 2020 Annual Meeting, senior management and the Compensation Committee conducted a comprehensive review of our executive compensation program as applicable to our named executive officers. Following this review, significant changes were made to the allocation among our incentive award components. In particular, the Compensation Committee approved the following changes to further align pay and performance:
•A change to the long-term incentive award mix by increasing the overall weighting of performance-based restricted stock units that vest based on the achievement of time-based and price-based targets;
•The cancellation of our former CEO’s annual housing and transportation allowance;
•The cancellation of our short-term incentive awards with respect to fiscal year 2020; and
•A modification to the peer group to add four companies that match well to Immersion.
•We expect that these modifications will enhance the link between pay and performance and will better align management with our shareholders. The modifications are explained in more detail in the pages that follow.
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Ongoing Business Transformation
Over the past few years, we have undertaken a strategic transformation of our business, and in turn, our executive leadership team and organizational structure, to effectively position ourselves to compete in a rapidly-evolving technology environment. Our overarching executive compensation objectives are to effectively align our compensation program design to our business strategy, and to attract, develop and retain executives with the background and experience required to lead us forward and provide the best opportunity to achieve sustained growth and profitability. This goal is difficult to accomplish for any business, but it can be particularly complicated when facing a global pandemic and challenging and volatile industry and business dynamics.
As of a result of our ongoing transformation efforts, we have two key leadership team members who are relatively new to their current roles. As described below, at the end of 2020, we promoted Jared Smith to be our Interim Chief Executive Officer, in addition to serving as our Vice President, Worldwide Sales. Mr. Smith is a seasoned executive who has held numerous senior management positions in licensing and business development roles in the technology industry. Additionally, at the beginning of 2020, Aaron Akerman joined the Company as Chief Financial Officer. Mr. Akerman has extensive industry experience in finance, strategic planning and corporate development experience. We have also made other changes within our executive leadership team and broader organization over the past few years.
To understand the design of our executive compensation program, it is important to consider our guiding compensation objectives in the context of our evolving business and management team transition. For 2020, the Compensation Committee focused on attracting, developing and retaining our executive team while incentivizing them to focus on building long-term value for stockholders. These considerations, along with a review of peer group and industry practices, resulted in a portion of our equity awards for 2020 being issued in the form of awards that vest based on the achievement of time-based and price-based targets.
2020 Chief Executive Officer Transition
The past year involved a managerial transition at the Chief Executive Officer position. As disclosed in the Company’s Form 8-K, filed with the SEC on November 5, 2020, Ramzi Haidamus departed as Chief Executive Officer and director of the Company, effective November 3, 2020. Jared Smith, the Company’s Vice President, Worldwide Sales, was appointed as Interim Chief Executive Officer, effective November 3, 2020. In connection with Mr. Smith’s appointment as Interim Executive Officer, the Compensation Committee approved an increase to Mr. Smith’s then-current annual base salary from $283,500 to $365,000, effective as of November 10, 2020. Additionally, Mr. Smith was granted an award of PSUs covering 100,000 shares of common stock.
2020 Chief Financial Officer
The past year also involved the successful conclusion of a search for a permanent Chief Financial Officer, which began in March 2019. Mr. Aaron Akerman was appointed as Chief Financial Officer effective as of January 13, 2020. Previously, Mr. Len Wood served as Interim Chief Financial Officer since July 2019. Our Board believes Mr. Akerman’s financial expertise is vital to our ongoing business transformation.
In connection with Mr. Akerman’s appointment, he received a base salary of CAD $310,000 per year (which was reduced to CAD $279,000 in light of the Company’s COVID-19-related cost-cutting initiatives described below), a sign-on bonus in the amount of CAD $40,000 and a target annual bonus opportunity under the Company’s Executive Incentive Plan of 50% of his then-current base salary.
Additionally, in connection with his appointment, the Company granted Mr. Akerman an option to purchase 140,000 shares of common stock with an exercise price equal to the fair market value of the Company’s common stock on his January 13, 2020 employment start date that will vest over four years
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with 1/4th of the total shares subject to the option vesting on the first anniversary of his employment start date and an additional 1/48th of the total shares subject to the option vesting each month thereafter, subject to Mr. Akerman’s continued employment on the applicable vesting dates. Mr. Akerman also received an RSU award covering 70,000 shares of common stock. The RSU will vest over three years, with one third of the total shares subject to the RSU vesting on each of the first, second and third anniversaries of Mr. Akerman’s employment start date, subject to his continued employment with the Company on the applicable vesting dates. Mr. Akerman was also granted an award of performance-based restricted stock units covering 30,000 shares of common stock.
COVID-19 Responsive Actions
On March 11, 2020, the World Health Organization declared a novel strain of coronavirus (“COVID-19”) a pandemic, and on March 13, 2020, the United States declared a national emergency with respect to COVID-19. Management responded quickly during the year to safeguard employees, avoid layoffs, preserve capital and maintain operations, while protecting shareholder interests. In response to the economic challenges resulting from COVID-19, the Company engaged in several initiatives designed to mitigate the impact of COVID-19 on the Company and to position the Company for longer-term growth while preserving our financial strength throughout this period of global uncertainty.
As part of the broader effort to address the near-term economic challenges brought on by the pandemic, the Company approved a reduction of officers’ salaries and its non-employee directors’ cash compensation. Specifically, effective as of April 1, 2020, the Board enacted a 25% reduction in each director’s cash compensation for service on the Board and each of its committees and, effective as of April 25, 2020, the Company implemented a 10% reduction in the base salaries of the Company’s executive officers along with other members of the Company’s senior management. Additionally, effective as of June 25, 2020, the Compensation Committee exercised its discretion to cancel the Company’s 2020 Executive Incentive Plan.
Finally, the Company also suspended its 401(k) matching program.
The Compensation Committee will continue to evaluate whether and when to reverse any of these changes and whether to make any changes to our compensation program for 2021.
2020 Business Highlights
The following are some of the highlights of our business results in 2020:
•Net income for 2020 was $5.4 million, or $0.19 per diluted share, compared to net loss of $20.0 million, or $0.64 per diluted share, for 2019.
•Announced commercial partnership with Faurecia for the use of Immersion’s haptic technologies and solutions for interactive haptic user interfaces for the car.
•Signed a multi-year license agreement with Woory Industrial Co. Ltd., a leading automotive supplier in Korea, for haptic technology use in automotive touchscreens.
•Executed renewal agreement with Abtivan, an innovative game peripheral OEM that offers force feedback steering wheel and related racing and flight simulator equipment.
•Signed a multi-year licensing agreement with SenseArena, a provider of VR products for athletes designed to improve reaction time and performance.
•Announced a collaboration agreement with StrikerVR, a developer of cutting-edge force feedback peripherals for the use of new adaptive trigger capabilities in StrikerVR’s next generation VR and gaming peripheral devices.
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•Named a Top 100 Global Innovator 2021 by Clarivate for the second year in a row. Clarivate is a global leader in providing trusted insights and analytics on research and intellectual property.
2020 Compensation Highlights
The following are some of the highlights related to the 2020 compensation of our named executive officers:
•The Compensation Committee granted PSUs to our executive officers and changed the long-term incentive award mix by increasing the overall weighting of PSUs in order to better align the compensation of our named executive officers with the creation of long-term stockholder value.
•The Compensation Committee exercised its discretion to cancel the 2020 Executive Incentive Plan, in light of COVID-19 and related events.
•The Board approved a 10% reduction in the base salaries of our executive officers.
•Based on the feedback we received from shareholders and the results of the advisory vote on executive compensation at our 2020 Annual Meeting, we made a number of changes to our executive compensation program to further align pay and performance. These changes included the cancellation of our former CEO’s annual housing and transportation allowance and a modification to the peer group to add four companies that match well to Immersion.
Overview of our Executive Compensation Program.
In determining the compensation of our named executive officers, the Compensation Committee evaluates various factors, including the following:
•our overall business and financial performance;
•how our compensation program can drive our strategic goals and support stockholder value creation;
•the individual’s performance, experience and skills;
•compensation previously paid or awarded to the individual; and
•competitive market data for similar positions based on an analysis consisting of a blend of data from our compensation peer group and the technology survey data from Radford Associates, a unit of Aon Consulting.
The Compensation Committee has established an executive compensation program that consists of three principal elements: base salary, short term cash incentive awards under our executive incentive plan (“EIP”) and long-term equity-based incentive awards (“LTI”). The Compensation Committee believes that by allocating compensation among these elements, our overall executive compensation program appropriately balances compensation-related risk and the desire to focus our named executive officers on specific short-term and long-term goals important to our overall success.
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Base Salary |  | Base salaries are fixed pay set with consideration of responsibilities, market data and individual contribution, in order to attract and retain talented executives.
Annual Cash Incentives |  | Annual cash incentives are intended to motivate and reward our executives for the achievement of corporate, litigation and individual objectives. For 2020, corporate goals were based on Revenue and non-GAAP Operating Expenses.
Long-Term Equity Incentives |  | Long-term equity awards incentivize executives to deliver long-term shareholder value, while also providing a retention vehicle for our top executive talent. In 2020, equity awards were delivered as stock options, restricted stock units and performance-based restricted stock units.

Executive Compensation Governance Policies and Best Practices
In designing our executive compensation program, we have implemented policies and practices to create alignment with our stockholders and that support our commitment to good corporate governance as follows:
•Clawback. Our Executive Incentive Plan provides the Company with the authority to require repayment of annual cash incentive awards in instances of fraudulent activity and/or misstated financials or otherwise inaccurate financial reporting.
•No Tax Gross-Ups. Tax gross-ups are not provided to our executive officers for personal expenses or if excise taxes are incurred following a qualifying termination of employment in connection with a change in control of the Company.
•Independent Compensation Consultant. The Compensation Committee has engaged Compensia, Inc. (“Compensia”) to act as its independent compensation consultant. Compensia provides services only to the Compensation Committee and provided no other services to us during fiscal 2020.
•Stock Ownership Guidelines. We have established stock ownership guidelines to further align our executive officers’ interests with those of our stockholders. The guidelines require our executive officers to acquire and hold shares of our common stock having a value equal to three, in the case of our CEO, and one, in the case of our other executive officers, times their base salary divided by the average closing price for the 12-month period ending on December 31.
•Capped Award Payouts. We set maximum award levels on our executive cash incentive plans.
•No Repricing of Underwater Options. Repricing of stock options is expressly prohibited by our equity incentive plan without the approval of our stockholders.
•No Executive Pension Benefits. Named executive officers participate in the same defined contribution retirement plans as our other employees.
•Anti-Hedging and Anti-Pledging Policy. Our named executive officers are subject to our Insider Trading Policy, which prohibits short sales, hedging or pledging of stock.
•Double Trigger Vesting. The equity awards held by our named executive officers are subject to “double trigger” vesting meaning that there needs to be both a termination of employment and change in control for the awards to vest.
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•Annual Say-on-Pay. We annually submit “say on pay” advisory votes for shareholder consideration and vote.
The Compensation Committee believes that the policies and practices described above clearly demonstrate our commitment to, and consistent execution of, an effective performance-oriented executive compensation program.
2020 Say on Pay Vote
At the annual meeting of our stockholders held in June 2020, approximately 72% of the total stockholders’ votes cast were voted in favor of the fiscal 2020 compensation of our named executive officers. While this vote was not binding on the Company, the Board, or the Compensation Committee, we believe that it is important for our shareholders to have an opportunity to vote on this proposal on an annual basis to express their views regarding executive compensation.
Additionally, in evaluating our compensation program, we routinely have discussions with our largest shareholders regarding many topics, which include discussions related to our compensation strategies.
We have determined that our stockholders should vote on a say on pay proposal each year, consistent with the preference expressed by our stockholders at the 2017 annual meeting.
Compensation Philosophy

The primary objective of our executive compensation program is to align compensation with our overall business goals and stockholder interests. Our compensation objective is to attract and retain top tier executive talent capable of managing in a dynamic business environment and motivate them to achieve above-market performance with a long-term view in creating stockholder value. To this end, our executive compensation philosophy reflects:
•a pay-for-performance model that delivers a significant portion of an executive’s total cash compensation based on overall Company and individual performance;
•an emphasis on long-term equity-based incentive awards that link a meaningful portion of executive compensation to the appreciation in value of our common stock; and
•evaluation of our pay levels and compensation practices against a peer group that is reasonable and appropriate for our Company.
Although the Compensation Committee has not established a fixed policy for the allocation between cash and equity compensation or short-term and long-term compensation, the Compensation Committee, as part of its evaluation of the compensation of our executive officers, reviews not only the individual elements of compensation, but also total compensation.
Pay-for-Performance
Our executive compensation program rewards executive officers for achievement of annual and long-term goals, based on their individual performance and their contribution to the overall performance of the Company. It is intended to balance annual performance incentives through salary and annual cash incentives with rewards for long-term performance through an equity incentive plan. In prior years, the equity incentive plan has utilized primarily stock option awards and awards of time-based restricted stock unit awards. As discussed below, commencing in 2020, we will also use performance-based restricted stock unit awards that vest over four years for long-term incentive compensation.
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While performance drives all aspects of our executive officers’ total direct compensation, in 2020, approximately 78% of the target total direct compensation of our CEO and other named executive officers was variable or performance-based, reflecting our pay-for-performance philosophy.
(1) The charts reflect the value of the 2020 target total direct compensation opportunity as considered by our Compensation Committee as follows with respect to our CEO and other NEOs: (i) annual salary for 2020; (ii) target 2020 Executive Incentive Plan bonus opportunity; and (ii) the grant date fair value of equity awards granted during 2020 under the 2011 Equity Incentive Plan.
As described under “Long-Term Equity Incentive Awards – PSUs”, in 2020, the Company altered its practices with respect to long-term equity incentive compensation. Our long-term incentive plan now employs a combination of stock options, restricted stock units and performance-based restricted stock units which vest over time to motivate and reward long-term, multi-year performance and facilitate retention of our executives. Stock options (which generally vest ratably over a four-year period) and restricted stock units awards (which generally vest ratably over a three or four-year period) create a balanced focus on the achievement of short-term and long-term financial and operational goals and stock price performance. Performance-based restricted stock units are earned based on multi-year performance over a four-year performance cycle. The performance-based restricted stock units vest based on attainment of stock price targets. The use of stock price targets as the vesting criteria for the performance-based restricted stock units ensures alignment between shareholders and participants. The Compensation Committee believes that by adopting this practice, it will serve to incentivize and reward executives for strong performance over the long-term.
Compensation Determination Process

Role of Compensation Committee
The Compensation Committee reviews and recommends to the Board for approval all compensation programs (including equity compensation) applicable to our named executive officers and directors, our overall strategy for employee compensation, and the specific compensation of our Chief Executive Officer.
The Compensation Committee approves the compensation of all other executive officers. The Compensation Committee has the sole authority to select and retain consultants, consulting firms, legal counsel, accounting and other advisers, as it deems appropriate.
Role of Chief Executive Officer in Compensation Decisions
While the Compensation Committee determines our overall compensation philosophy, our Board sets the compensation for our Chief Executive Officer. Our Chief Executive Officer also provides our Board and
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the Compensation Committee with his perspective on the performance of our named executive officers as part of the determination of the individual portion payable under the executive incentive plans (as described below) and the annual personnel review as well as a self-assessment of his own performance. Our Chief Executive Officer is not present during discussions by the Compensation Committee or our Board relating to his own compensation. Our Chief Executive Officer recommends to the Compensation Committee specific compensation amounts for named executive officers other than himself, and the Compensation Committee considers those recommendations and the information provided by its compensation consultant concerning peer group comparisons and industry trends when making its compensation decisions. Our Chief Executive Officer, members of our Human Resources department, and General Counsel regularly attend portions of the Compensation Committee’s meetings to provide perspectives on the competitive landscape and the needs of the business, information regarding our performance, and technical advice. Members of the Compensation Committee also participate in our Board’s annual review of the Chief Executive Officer’s performance and its setting of annual performance goals, in each case led by our independent Executive Chairman of the Board or previously our Lead Independent Director.
Role of the Compensation Consultant
The Compensation Committee uses a compensation consultant primarily to provide input on compensation trends and developments and to assist with the analysis of competitive executive compensation levels and trends. The compensation consultant also provides a valuable outside perspective on executive compensation practices.
In establishing executive compensation for fiscal 2020, the Compensation Committee engaged Compensia to serve as its compensation consultant. During fiscal 2020, Compensia advised the Compensation Committee on executive compensation matters, including performing an executive compensation assessment, a peer group review and development, the structure of our compensation program, risk mitigation, advice on CEO and CFO compensation and disclosure about executive compensation. Compensia was engaged directly by the Compensation Committee and does not provide any other unrelated products or services to us. Based on its review of the factors set forth in the Nasdaq listing standards, the Compensation Committee has determined that the work performed by Compensia during fiscal year 2020 did not raise a conflict of interest.
Peer Group and Competitive Positioning
In performing the executive compensation assessment for our Chief Executive Officer and Chief Financial Officer, Compensia used market data that reflected a 50/50 blend of (1) compensation data from the peer group below and (2) national Radford technology survey data for companies with $50 to $200 million in revenues. In performing the executive compensation assessment for all other executive officers, Compensia used the national Radford technology survey data for companies with $50 to $200 million in revenues. Compensia also reviewed for all executive officers the same blend using Bay Area Radford technology survey data.
The companies comprising the peer group used by Compensia to aid in evaluating the compensation of our executive officers for 2020 were:
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Acacia Research | CEVA | CyberOptics
Digimarc | Finjan Holdings | GSI Technologies (new)
Impinj | Intelligent Systems (new) | Luna Innovations (new)
Mitek Systems | MobileIron | NVE
PDF Solutions | Pixelworks | SeaChange International (new)
VirnetX Holding Corp (new) |  |

In determining the peer group for 2020, the Compensation Committee reviewed the peer group used in fiscal 2019 against the objective criteria used for selecting peers in 2019 including companies in the IP licensing, semiconductor, software, technology hardware, storage and peripherals, and other technology/hardware equipment industries with revenues that were approximately one-half to three times our revenues for 2019 and market capitalizations equal to approximately one-half to three times our market capitalization. The following companies were deleted from the peer group in 2020: Aquantia, Datawatch, Agilysys, Mesa Laboratories and USA Technologies.
While the Compensation Committee believes that comparisons to competitive market data are a useful tool, it does not believe that it is appropriate to establish executive compensation levels based solely on a comparison to market data. Due to the variations between companies’ reporting and the roles for which compensation for these companies is ultimately disclosed, directly comparable information is not available from each peer group company with respect to each of our named executive officers. In considering market compensation data, the Compensation Committee recognizes that executives at different companies can play significantly different roles, with different responsibilities and scopes of work, even though they may hold similar titles or nominal positions. The Compensation Committee therefore uses the competitive market data as a starting point while also considering subjective factors such as experience, skills, competencies and performance.
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Elements of Compensation

Our named executive officers’ total compensation includes base salary, short term cash incentive awards under our executive incentive plan (other than for our Interim Chief Executive Officers), and long-term equity incentive compensation.

Element | Objectives | Key Features
Base Salary | • To provide a fixed level of cash compensation to attract and retain executive officers, and reward demonstrated experience, skills and competencies relative to the market value of the job. | •Adjustments are considered annually based on individual performance, level of pay relative to market and internal pay equity.
Short-Term Cash Incentive Awards | • Rewards annual corporate and individual performance. • Aligns compensation with performance against the board-approved annual operating plan | •Short-term cash incentive payments are based on financial, litigation and individual performance •For 2020, financial measures were: ◦Revenue ◦Non-GAAP Operating Expenses •Earned annual incentive awards can vary from 0% to 240% of the target amount for our CEO and 0% to 204% for all named executive officers. With respect to the fiscal 2020 Executive Incentive Plan, no awards were paid out to our named executive officers because the 2020 Executive Incentive Plan was cancelled.
Long-Term Incentive Awards (Equity Awards) | • Aligns named executive officers’ interests with long-term stockholder interests by linking part of executive compensation to stock price performance. • Provides opportunities for wealth creation and ownership which promotes retention and enables us to attract and motivate our named executive officers. • Provides a retention vehicle through multi-year vesting of equity granted and multi-year performance periods. | •Uses different equity types, including stock options, restricted stock unit (“RSU”) awards and performance-based restricted stock unit awards (“PSU”) to balance stockholder interests and retention. •Long-term equity awards generally vest in increments over three years for RSUs or four years for stock options and PSUs.

Base Salary
In determining base salaries for our named executive officers, the Compensation Committee considered the market data for executives serving in similar positions, as well as individual performance, experience and skills.
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The named executive officers’ base salaries for 2020, as compared to 2019, were as follows:

Name |  | 2019 Base Salary ($) | 2020 Base Salary ($)(1) | % Increase
Ramzi Haidamus |  | 525,000 | 525,000 | —
Aaron Akerman(2) |  | — | 231,386 | —
Michael Okada |  | 375,000 | 381,000 | 1.6%
Jared Smith(3) |  | 310,000 | 315,000 | 1.6%
Len Wood(4) |  | — | — | —

(1) These base salaries were prior to the 10% base salary reduction noted above in “COVID-19 Responsive Actions.”
(2) Amounts paid in Canadian dollars have been converted to U.S. dollars using the average daily exchange rates from January 1, 2020 to December 31, 2020 of CAD $1 to USD $0.75.
(3) The Compensation Committee approved an increase to Mr. Smith’s base salary to $365,000, effective as of November 10, 2020, in connection with Mr. Smith’s service as Interim Chief Executive Officer.
(4) Mr. Wood was paid as an hourly contractor.
As noted above in “COVID-19 Responsive Actions,” in light of COVID-19 and related events and their impact on the Company’s business, the Board approved a 10% reduction in the base salaries of the Company’s executive officers, including Messrs. Haidamus, Akerman, Okada, and Smith, along with other members of the Company’s senior management reporting directly to Mr. Haidamus, with such reduction effective April 15, 2020.
As disclosed in the Company’s Form 8-K, filed with the SEC on November 16, 2020, in connection with Mr. Smith’s appointment as Interim Executive Officer, the Compensation Committee approved an increase to Mr. Smith’s then-current annual base salary from $283,500 to $365,000, effective as of November 10, 2020, representing a 28.7% increase over his then-current base salary and a 17.7% increase over his base salary in fiscal year 2019.
Mr. Wood billed at $200 per hour during the time that he served as Interim Chief Financial Officer.
Annual Cash Incentives
The 2020 Executive Incentive Plan is a cash incentive program designed to align executive compensation with annual performance and to enable us to attract, retain, and reward individuals who contribute to our success and to motivate such individuals to enhance our value. The Compensation Committee believes that aggregate incentive payouts should be closely linked to our overall financial performance, with individual compensation differentiated based on individual performance. Thus, funding and payouts under such plan is dependent and based on both corporate and individual performance further reinforcing our pay-for-performance philosophy.
The Compensation Committee established a target award value as a percentage of base cash compensation for Messrs. Okada, Smith, Haidamus and Akerman for fiscal 2020 based on its review of competitive market data for similar positions and various other factors, including the terms of employment arrangements with the individual. Mr. Wood did not participate in the 2020 Executive Incentive Plan. Thus, the remainder of this section sets forth the Company’s annual cash incentive compensation philosophy generally and describes the specific metrics and criteria that were established by the Compensation Committee for 2020 prior to the onset of COVID-19.
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Messrs. Haidamus’, Smith’s and Okada’s target award percentages for 2020 remained the same as 2019 at 100%, 60% and 50% of their base salary as of March 2, 2020, respectively. Mr. Akerman’s target award percentage was set at 50% of his base salary.
As noted in “COVID-19 Responsive Actions,” the Compensation Committee exercised its discretion to cancel the Company’s 2020 Executive Incentive Plan, effective June 25, 2020, in light of COVID-19 and related events and their impact on the Company’s business. As a result, Messrs. Haidamus, Smith, Okada and Akerman did not receive any payouts under the 2020 Executive Incentive Plan. As discussed in “Elements of Compensation – Long-Term Equity Incentive Awards”, the Compensation Committee reserved its discretion to approve other incentives that better aligned with performance and stockholder interests, and in November 2020, the Compensation Committee granted performance-based restricted stock units tied to the Company’s stock price to each of Messrs. Smith, Okada, and Akerman.
2020 Executive Incentive Plan Payments
The following table sets forth the determinations of the Compensation Committee in February 2020 with respect to the Executive Incentive Plan targets for fiscal 2020 prior to the emergence of COVID-19, as well as the actual amount of the cash incentive awards received by our named executive officers upon payout of the fiscal 2020 Executive Incentive Plan (which was $0 since the 2020 Executive Incentive Plan was cancelled).

Name(1) | Target Incentive Opportunity (as a % of base salary) | Target Award Value) ($)(2) | 2020 Earned Awards ($)
Ramzi Haidamus | 100% | 525,000 | —
Michael Okada | 50% | 190,500 | —
Jared Smith | 60% | 186,000 | —
Aaron Akerman | 50% | 115,693 | —

(1) Mr. Wood did not participate in the 2020 Executive Incentive Plan
(2) Amounts payable in Canadian dollars have been converted to U.S. dollars using the average daily exchange rates from January 1, 2020 to December 31, 2020 of CAD $1 to USD $0.75.
The Compensation Committee, with input from our Chief Executive Officer, establishes (1) the performance measures based on business criteria and target levels of performance and (2) a formula for calculating each participant’s award based on our actual performance compared to the pre-established performance goals.
Our 2020 Executive Incentive Plan for our named executive officers, except for Messrs. Haidamus and Akerman, was based on two independent components: (i) corporate financial metrics and (ii) the achievement of individual management objectives. For payment to have been made under the corporate component and individual management objectives of the plans, we must have met the minimum GAAP revenue and Non-GAAP Operating Expenses target levels set forth in the matrix below. If minimum GAAP revenue and Non-GAAP Operating Expenses were not achieved, then the plan would not be funded. The maximum level of payout for the corporate component of the bonus was 200%. In addition, the Compensation Committee determined the performance weighting factor to be applied to the calculation of each named executive officer’s bonus, which weighting factor was based on each named executive officer’s overall individual annual performance as determined by the Compensation Committee. The standard weighting factor was 1.0 but could be increased or decreased by 0.2 at the Compensation Committee’s discretion. If such weighting factor was increased or decreased from the standard weighting factor of 1.0, then such modified weighting factor was applied to (i) corporate financial metrics and (ii) the achievement of individual management objectives to determine the total incentive payment. As a result, our named executive officers were eligible to receive a maximum cash award of 204% ((70% corporate bonus x 200% maximum payout = 140% x 1.2 maximum weighting factor = 168%) plus (30% maximum individual component x 1.2 maximum weighting factor = 36%) = 204% aggregate maximum bonus) of
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their respective target award based on the achievement of corporate financial goals and individual performance goals.
Our 2020 Executive Incentive Plan for Messrs. Haidamus and Akerman did not include the individual management objectives component and instead was entirely based on the corporate financial metrics component. As a result, Messrs. Haidamus and Akerman were eligible to receive a maximum cash award of 240% (100% corporate bonus x 200% maximum payout = 200% x 1.2 maximum weighting factor = 240% aggregate maximum bonus) of their respective target awards.
The GAAP revenue and Non-GAAP Operating Expenses matrix for the corporate objectives of the 2020 Executive Incentive Plans was set by the Compensation Committee and was based on our annual operating plan. The matrix was as follows:

Revenue (Weighted 50%) | Threshold |  | Target |  | Maximum
Revenue | $28,700,800 | $32,288,400 | $35,876,000 | $39,463,600 | $43,051,200
% of target achievement | 80% | 90% | 100% | 110% | 120%
Payout (as % of target) | 50% | 75% | 100% | 150% | 200%
Non-GAAP Operating Expenses (Weighted 50%) | Threshold |  | Target |  | Maximum
Non GAAP Operating Expenses | $28,621,317 | $27,320,348 | $26,019,380 | $24,718,411 | $23,417,442
% of target achievements | 90% | 95% | 100% | 105% | 110%
Payout (as % of target) | 50% | 75% | 100% | 150% | 200%

For purposes of the fiscal 2020 Executive Incentive Plan, “GAAP revenues” means revenue recognized by us for the applicable period in accordance with GAAP and as reported in our audited financial statements, and “Non-GAAP Operating Expenses” is GAAP Operating Expenses adjusted to exclude stock-based compensation, litigation, restructuring, depreciation, executive incentive plan bonus and rank-and-file employee bonus payments and other charges as determined by the Compensation Committee. By excluding certain one-time items from the calculations, the Compensation Committee sought to utilize an operating performance metric that excludes certain non-cash expenses and other special charges that many investors feel may obscure our true operating performance.
Our performance for fiscal 2020 resulted in GAAP revenues of $30.18 million and Non-GAAP Operating Expenses of $20.81 million. Thus, our revenue fell between $28.70 million and $32.29 million and our Non-GAAP Operating Expenses fell below $23.42 million.
For the individual performance of each named executive officer except for Messrs. Haidamus and Akerman, the Compensation Committee in February 2020 approved the structure of each named executive officer’s respective 2020 Executive Incentive Plan in terms of what percentage of the target bonus award would be based on corporate financial metrics and what percentage of the target bonus award would be based on MBOs (which the Board had set for Messrs. Okada and Smith in December 2019). Mr. Okada’s MBOs included elements related to subsidiary restructuring, patent review and cost management, and matters relating to ongoing legal proceedings. Mr. Smith’s MBOs included initiatives related to strategic customer and partner engagements and sales strategy in China.
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Long-Term Equity Incentive Awards
Stock Options
Stock options are intended to align our named executive officers’ interests with the interests of stockholders in increasing sustainable, long-term stockholder value. We view stock options as an element of performance-based compensation because they only deliver value to a recipient if the price of our common stock increases above the price of our common stock at the time of grant and the vesting requirements have been met. Our stock options are granted with an exercise price equal to the closing market price for our common stock on the date of grant. Our stock options typically vest over a period of four years with 25% of the shares of our common stock subject to the grant vesting after the first year and 1/48 th of the shares subject to the grant vesting monthly thereafter.
RSUs
RSUs are intended primarily to aid in management retention, and ensure that, coupled with our stock ownership guidelines, executives maintain an ownership stake in our company that is tied to stock price performance. The Compensation Committee believes that by providing an ownership stake, RSUs incentivize executives to drive our stock price performance, aid in retention and provide value to our executive officers directly aligned with stockholder value. Our RSUs typically vest over a period of three or four years.
The Compensation Committee approved annual equity awards to our named executive officers in fiscal 2020 after considering individual and corporate performance generally, the total compensation levels of our executive officers and our retention objectives. The Compensation Committee also considered the compensation practices and levels of the companies in our peer group when determining the size of equity awards.
PSUs
PSUs are intended to align our named executive officers’ interests with the interests of stockholders in increasing sustainable, long-term stockholder value. The Compensation Committee views PSUs as an element of performance-based compensation because they only deliver value to a recipient if the weighted average price of our common stock meets certain stock price targets and the vesting requirements have been met.
As disclosed in the Company’s Form 8-K, filed with the SEC on November 16, 2020, the Compensation Committee granted PSUs to Messrs. Smith, Okada and Akerman in order to better align the compensation of our named executive officers with the creation of long-term stockholder value, thereby further reinforcing our pay-for-performance philosophy.
Mr. Smith was granted an award of PSUs covering 100,000 shares of common stock, and each of Messrs. Okada and Akerman were granted awards of PSUs covering 30,000 shares of common stock
Each PSU will become eligible to vest upon the achievement of certain stock price targets as set forth below (each, a “Performance Milestone”). Vesting is also subject to continued employment with the Company through the applicable vesting dates, which occur upon the later of: (i) the date of achievement of the applicable Performance Milestone, or (ii) the service vesting date, which service vesting date occurs over a four-year period commencing on November 10, 2020, with 25% of the shares eligible to vest on November 10, 2021 and the remaining shares eligible to vest in equal installments each quarterly anniversary thereafter.

Stock Price Target | Amount of PSU Award Eligible to Vest
$8.00 | 33.33%
$9.25 | 33.33%
$10.50 | 33.34%

Each stock price target will be achieved if the volume weighted average price of the Common Stock meets or exceeds such stock price target in any one hundred calendar day-period falling within the period beginning on November 10, 2020 and ending on November 10, 2025.
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Notwithstanding the foregoing, upon a change of control, the PSUs will immediately vest with respect to any stock price target achieved by such transaction, and any unvested portion of the PSUs will be cancelled upon the consummation of such change of control.
Additional Compensation Policies and Practices

Severance and Change in Control Payments
We have entered into retention and change in control agreements with our named executive officers with the goal of retaining such executive officers during the pendency of a proposed change of control transaction, and in order to align the interests of the executive officers with the interests of our stockholders in the event of a potential change in control of the Company. These arrangements are intended to attract and retain qualified executives who could have other job alternatives that may appear to them to be less risky absent these arrangements, particularly given the significant level of acquisition activity in our industry. Our severance arrangements for our named executive officers, except for Len Wood, Ramzi Haidamus, and Aaron Akerman, outside of a change of control of the Company provide for cash severance equal to six months’ base salary and reimbursement of health insurance premiums for up to six months. In the case of Mr. Haidamus, cash severance equals 12 months’ base salary, we reimburse for 12 months of health insurance premiums, provide 100% of his bonus for the then-current fiscal year, and immediately vest the stock options and RSUs that would have vested during the following 12 months. In the case of Mr. Akerman, cash severance equals 12 months’ base salary and we reimburse for 12 months of health insurance premiums.
All of our change of control arrangements are “double trigger,” meaning that severance payments and acceleration of vesting of equity awards are not awarded upon a change of control unless, within 12 months following the change of control, the executive’s employment is terminated without cause or as a result of good reason, each as defined in the applicable agreement.
We believe the structure of our “double trigger” change of control arrangements protects stockholder value by allowing us the opportunity to deliver an intact and motivated management team to any potential acquirer. If we did not offer any such change of control arrangements, our executives could be less motivated to pursue a potential acquisition even if such a transaction would benefit our stockholders, because of the possibility that they would lose the potential value of their unvested equity compensation or future cash compensation upon an acquisition. If we offered “single trigger” change of control arrangements, meaning that our executives would receive benefits upon an acquisition even if their employment was not terminated, we could become less attractive to potential acquirers, who may place significant value on retaining members of our executive team and who may perceive this goal to be undermined if executives receive acceleration payments in connection with such a transaction and would no longer be required to continue employment to earn the remainder of their equity awards. We believe the “double trigger” structure strikes an appropriate balance between these alternatives because it motivates our executives to both pursue transactional opportunities that would provide the greatest benefit to stockholders, and to continue providing services to the surviving Company following such a transaction, increasing our value to potential acquirers and, as a result, to our stockholders. The Compensation Committee believes that these payments and benefits serve to enhance stockholder value and align our executive officers’ interests with those of our stockholders in change in control transactions. All such agreements with the named executive officers are described in “Potential Payments upon Termination or Change in Control” elsewhere in this proxy statement.
Perquisites and Other Benefits
We provide certain named executive officers with perquisites and other personal benefits that the Compensation Committee believes are reasonable and consistent with our overall compensation programs and philosophy and which benefits are generally available to all our employees. These benefits are provided to enable us to attract and retain these executive officers. The Compensation Committee periodically reviews the levels of these benefits provided to our executive officers. These benefits include participation in our health and benefits plans, retirement savings plans, housing assistance, reimbursement of certain living and education-related expenses, travel expense assistance, immigration assistance, relocation assistance, and our employee stock purchase plan.
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Stock Ownership Policy
Our executive officers and non-employee directors are subject to a stock ownership policy that is available on our website at https://ir.immersion.com/corporate-governance. See “Corporate Governance—Company Policies” above.
Impact of Accounting and Tax Requirements on Compensation
Section 162(m) of the Internal Revenue Code limits the deductibility of certain items of compensation paid to the CEO and certain other highly compensated executive officers (together, the “covered officers”) to $1,000,000 annually, but in years prior to 2018 there was an exception to such limit for compensation that qualified as “performance-based compensation”. Effective for 2018, the Tax Cuts and Jobs Act amended Section 162(m) to, among other things, extend the deduction limitation to the Chief Financial Officer and eliminate the exception for performance-based compensation, except for certain qualifying arrangements in place as of November 2, 2017.
Favorable accounting and tax treatment of the various elements of our total compensation program was an important, but not the sole, consideration in its design. The Committee reserves the right to provide for compensation to executive officers that may not be deductible pursuant to Section 162(m).
Risk Assessment of Compensation Programs
The Compensation Committee considers potential risks when reviewing and approving our compensation programs. We have designed our compensation programs, including our incentive compensation plans, with specific features to address potential risks while rewarding our employees for achieving financial and strategic objectives through prudent business judgment and appropriate risk taking. The following elements have been incorporated in our compensation programs for our named executive officers:
•A Balanced Mix of Compensation Components – The target compensation mix for our named executive officers is composed of base salary, short-term cash incentive awards and long-term equity incentives, representing a mix that is not overly weighted toward short-term cash incentives.
•Multiple Performance Factors – Our short-term and long-term incentive compensation plans use both Company-wide metrics and individual performance, which encourage focus on the achievement of objectives for our overall benefit.
◦The executive incentive plan is designed to use multiple performance metrics including GAAP revenue and Non-GAAP Operating Expenses, as well as individual performance goals related to specific strategic or operational objectives and the corporate metric portion of the incentive plan does not pay out unless the target levels of the pre-established financial metrics are met.
◦The long-term incentives are equity-based, generally with three- or four-year vesting to complement our short-term cash incentive awards.
•Capped Incentive Awards – Awards under the executive incentive plans are generally capped at the sum of: (1) 200% of the target bonus attributable to Company-wide metrics (with a maximum multiplier of 1.2), plus (2) 100% of the target bonus attributable to individual performance (with a maximum multiplier of 1.2).
•Clawback – Our Board has the authority to recoup past incentive compensation in the event of a material restatement of our financial results due to fraud, intentional misconduct or gross negligence of the named executive officer.
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Additionally, the Compensation Committee considered an assessment of the compensation-related risks arising from our compensation programs for all our employees. Based on this assessment and the factors noted above, the Compensation Committee concluded that our compensation programs do not create risks that are reasonably likely to have a material adverse effect on us. In making this evaluation, the Compensation Committee reviewed the key design elements of our compensation programs in relation to industry “best practices” as presented by Compensia, as well as how any potential risks may be mitigated, such as through our internal controls and oversight by management and our Board.
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COMPENSATION COMMITTEE REPORT
The following report of the Compensation Committee shall not be deemed to be “soliciting material” or to otherwise be considered “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933, as amended, or the Exchange Act except to the extent that we specifically incorporate it by reference into such filing.
We, the Compensation Committee of the Board of Directors of Immersion Corporation, have reviewed and discussed the Compensation Discussion and Analysis contained in this proxy statement with management. Based on such review and discussion, we have recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement and incorporated by reference into our Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

| COMPENSATION COMMITTEE
| William Martin, Chairman Eric Singer Stephen Domenik

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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
William Martin, Eric Singer, Stephen Domenik, Jonathan Visbal, and Sharon Holt were members of our Compensation Committee during the 2020 fiscal year. None of the individuals serving on our Compensation Committee were at any time during 2020, or at any other time, an officer or employee of us, nor did they have any relationships requiring disclosure by us under the SEC’s rules requiring disclosure of certain relationships and related party transactions. None of our executive officers serve as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of our Board or our Compensation Committee.
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EXECUTIVE COMPENSATION
2020 Summary Compensation Table

The following table sets forth information concerning the compensation earned during the years ended December 31, 2020, 2019, and 2018 by our named executive officers for 2020.

Name and Principal Position |  | Fiscal Year |  | Salary ($) |  | Bonus ($) |  | Stock Awards(1) ($) |  | Option Awards(1) ($) |  | Non-Equity Incentive Plan Compensation(2) ($) |  | All Other Compensation ($) |  | Total ($)
Jared Smith Interim Chief Executive Officer and Vice President, Worldwide Sales |  | 2020 |  | 303,517 |  | — |  | 907,931 | (7) | — |  | — |  | 2,118 | (19) | 1,213,566
|  | 2019 |  | 180,536 |  | — |  | 596,800 | (8) | 489,990 | (14) | 80,158 |  | 25,000 | (20) | 1,372,484
Aaron Akerman(3) Chief Financial Officer |  | 2020 |  | 214,871 |  | 29,856 | (6) | 722,900 | (9) | 452,102 | (15) | — |  | 193 | (21) | 1,419,923
Michael Okada General Counsel and SVP, IP Licensing and Legal Affairs |  | 2020 |  | 352,822 |  | — |  | 484,987 | (10) | — |  | — |  | 1,925 | (22) | 839,734
|  | 2019 |  | 211,207 |  | — |  | 580,388 | (11) | 535,722 | (16) | 90,819 |  | — |  | 1,418,136
Ramzi Haidamus(4) President and Chief Executive Officer |  | 2020 |  | 411,784 |  | — |  | 239,876 | (12) | 559,008 | (17) | — |  | 552,467 | (23) | 1,763,136
|  | 2019 |  | 496,839 |  | — |  | 2,766,903 | (13) | 1,250,000 | (18) | 397,471 |  | 47,318 | (24) | 4,958,531
Len Wood(5) Interim Chief Financial Officer |  | 2020 |  | — |  | — |  | — |  | — |  | — |  | 309,058 | (25) | 309,058
|  | 2019 |  | — |  | — |  | — |  | — |  | — |  | 271,658 | (26) | 271,658

(1) The amounts in this column represent the aggregate grant date fair value of the awards, computed in accordance with FASB ASC Topic 718. See Note 6 of the notes to our consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2020 for a discussion of our assumptions in determining the FASB ASC Topic 718 values.
(2) Consists of bonus awards under our Executive Incentive Plan. See “Compensation Discussion and Analysis” above for a description of our 2020 Executive Incentive Plan. However, effective June 25, 2020, the Compensation Committee exercised its discretion to cancel the 2020 Executive Incentive Plan, in light of COVID-19 and related events and their impact on the Company’s business.
(3) Amounts paid in Canadian dollars have been converted to U.S. dollars using the average daily exchange rates from January 1, 2020 to December 31, 2020 of CAD $1 to USD $0.75.
(4) Mr. Haidamus served as our Chief Executive Officer from January 21, 2019 to November 3, 2020.
(5) Mr. Wood was paid as an hourly contractor.
(6) Mr. Akerman received a sign-on bonus of CAD $40,000.
(7) Consists of (i) 53,026 RSUs with a grant date fair value of $287,931, and (ii) 100,000 PSUs with a grant date fair value of $620,000. Assuming that the highest level of performance conditions with respect to the PSUs will be achieved, the value of the PSUs at grant date was $925,013.
(8) Mr. Smith received RSUs with a grant date fair value of $596,800 upon joining Immersion.
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(9) Consists of (i) 70,000 RSUs with a grant date fair value of $536,900, and (ii) 30,000 PSUs with a grant date fair value of $186,000. Assuming that the highest level of performance conditions with respect to the PSUs will be achieved, the value of the PSUs at grant date was $277,504.
(10) Consists of (i) 55,062 RSUs with a grant date fair value of $298,987, and (ii) 30,000 PSUs with a grant date fair value of $186,000. Assuming that the highest level of performance conditions with respect to the PSUs will be achieved, the value of the PSUs at grant date was $277,504.
(11) Mr. Okada received RSUs with a grant date fair value of $580,388 upon joining Immersion.
(12) Consists of 44,176 RSUs with a grant date fair value of $239,876.
(13) Mr. Haidamus received RSUs with a grant date fair value of $2,766,903 upon joining Immersion.
(14) Upon joining Immersion, Mr. Smith received an option to purchase 150,000 shares with an exercise price of $7.46 per share, which option expires on July 15, 2026.
(15) Upon joining Immersion, Mr. Akerman received an option to purchase 140,000 shares with an exercise price of $7.67 per share, which option expires on January 13, 2027.
(16) Upon joining Immersion, Mr. Okada received an option to purchase 164,000 shares with an exercise price of $7.46 per share, which option expires on July 15, 2026.
(17) Consists of an option to purchase 316,056 shares with an exercise price of $7.54 per share, which option expires on March 9, 2027.
(18) Upon joining Immersion, Mr. Haidamus received an option to purchase 268,992 shares with an exercise price of $9.82 per share, which option expires on February 14, 2026.
(19) Consists of: (i) $1,923 in contributions by the Company to Mr. Smith's 401(k) account; and (ii) $194 in premiums paid by the Company with respect to life insurance for the benefit of Mr. Smith.
(20) Mr. Smith received a $25,000 one-time relocation payment upon joining Immersion.
(21) Consists of CAD $258 in premiums paid by the Company with respect to life insurance for the benefit of Mr. Akerman.
(22) Consists of: (i) $1,731 in contributions by the Company to Mr. Okada's 401(k) account; and (ii) $194 in premiums paid by the Company with respect to life insurance for the benefit of Mr. Okada.
(23) Consists of: (i) $537,961 in certain severance payments pursuant to that certain Separation Agreement and General Release, dated November 3, 2020, by and between Mr. Haidamus and the Company; and ADEA Release, dated November 3, 2020, by and between Mr. Haidamus and the Company; (ii) $1,923 in contributions by the Company to Mr. Haidamus' 401(k) account; (iii) $178 in premiums paid by the Company with respect to life insurance for the benefit of Mr. Haidamus; and (iv) $12,404.58 in travel and housing allowance, which allowance was terminated on March 31, 2020.
(24) Mr. Haidamus received a pro rata portion of a $50,000 annual housing and transportation allowance. This allowance was terminated on March 31, 2020.
(25) Consists of hourly fees paid to Mr. Wood.
(26) Consists of hourly fees paid to Mr. Wood.
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2020 Grants of Plan-Based Awards

The following table sets forth information concerning each grant of an award made to a named executive officer during the year ended December 31, 2020:

|  |  | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | All Other Stock Awards: Number of Shares of Stock or Units(2) (#) | All Other Option Awards: Number of Securities Underlying Options(3) (#) | Exercise or Base Price of Option Awards ($/sh) | Grant Date Fair Value of Stock and Option Awards(4) ($)
Name | Compensation Committee Approval Date | Grant Date | Threshold ($) | Target ($) | Maximum ($)
Ramzi Haidamus | 3/4/2020 | 3/4/2020 | — | — | — |  |  |  |
| 3/4/2020 | 3/9/2020 |  |  |  |  | 316,056 | 7.54 | 559,008
| 3/4/2020 | 3/9/2020 |  |  |  | 44,176 |  |  | 239,876
Michael Okada | 2/24/2020 | 2/24/2020 | — | — | — |  |  |  |
| 2/25/2020 | 3/9/2020 |  |  |  | 55,062 |  |  | 298,987
| 11/10/2020 | 11/10/2020 |  |  |  | 30,000 |  |  | 186,000
Jared Smith | 2/24/2020 | 2/24/2020 | — | — | — |  |  |  |
| 2/25/2020 | 3/9/2020 |  |  |  | 53,026 |  |  | 287,931
| 11/10/2020 | 11/10/2020 |  |  |  | 100,000 |  |  | 620,000
Aaron Akerman | 11/22/2019 | 1/13/2020 |  |  |  |  | 140,000 | 7.67 | 452,102
| 11/22/2019 | 1/13/2020 |  |  |  | 70,000 |  |  | 536,900
| 2/24/2020 | 2/24/2020 | — | — | — |  |  |  |
| 11/10/2020 | 11/10/2020 |  |  |  | 30,000 |  |  | 186,000

(1) Effective June 25, 2020, the Compensation Committee exercised its discretion to cancel the 2020 Executive Incentive Plan, in light of COVID-19 and related events and their impact on the Company’s business. Mr. Wood did not participate in the 2020 Executive Incentive Plan. For a description of the criteria upon which the awards are determined, see “Compensation Discussion and Analysis” above.
(2) Consists of RSUs and PSUs granted pursuant to our 2011 Equity Incentive Plan. RSUs typically vest over a period of three or four years. PSUs become eligible to vest upon the achievement of certain stock price targets. Vesting is also subject to continued employment with the Company through the applicable vesting dates, with 25% of the shares eligible to vest on the one-year anniversary of the grant date and the remaining shares eligible to vest in equal installments each quarterly anniversary thereafter. For more information related to these awards, see “Compensation Discussion and Analysis” above.
(3) These options are long-term equity incentive awards granted pursuant to our 2011 Equity Incentive Plan and vest as to 25% of the shares on the one-year anniversary of the grant date and 1/48 th of the shares monthly thereafter. For more information related to these awards, see “Compensation Discussion and Analysis” above.
(4) The amounts in this column represent the aggregate grant date fair value of the awards computed in accordance with FASB ASC Topic 718. See Note 6 of the notes to our consolidated financial statements contained in our Annual Report on form 10-K for the year ended December 31, 2020 for a discussion of our assumptions in determining the FASB ASC Topic 718 values.
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Outstanding Equity Awards at December 31, 2020
The following table sets forth information concerning the outstanding equity awards held as of December 31, 2020 by our named executive officers:

|  |  | Option Awards(1) |  | Stock Awards
|  |  | Number of Securities Underlying Unexercised Options |  |  |  |  |  | Number of Shares or Units of Stock that Have Not Vested (#) |  | Market Value of Shares or Units of Stock that Have Not Vested(4) ($)
Name | Stock Option Grant Date |  | Exercisable (#) |  | Unexercisable (#) |  | Option Exercise Price ($/share) |  | Options Expiration Date |  |
Ramzi Haidamus | 2/14/2019 |  | 128,892 |  |  | — |  |  | 9.82 |  | 2/14/2026 |  |  |  |
Michael Okada | 7/15/2019 |  | — |  | 102,500 |  |  | 7.46 |  | 7/15/2026 |  |  |  |
| 7/15/2019 |  |  |  |  |  |  |  |  |  | 51,866 |  | (2) | 585,567 |
| 3/9/2020 |  |  |  |  |  |  |  |  |  | 55,062 |  | (2) | 621,650 |
| 11/10/2020 |  | — |  | — |  | — |  | — |  | 30,000 |  | (3) | 338,700 |
Jared Smith | 7/15/2019 |  | 56,250 |  |  | 93,750 |  |  | 7.46 |  | 7/15/2026 |  |  |  |
| 7/15/2019 |  |  |  |  |  |  |  |  |  | 53,333 |  | (2) | 602,130 |
| 3/9/2020 |  |  |  |  |  |  |  |  |  | 53,026 |  | (2) | 598,664 |
| 11/10/2020 |  |  |  |  |  |  |  |  |  | 100,000 |  | (3) | 1,129,000 |
Aaron Akerman | 1/13/2020 |  | — |  |  | 140,000 |  |  | 7.67 |  | 1/13/2027 |  |  |  |
| 1/13/2020 |  |  |  |  |  |  |  |  |  | 70,000 |  | (2) | 790,300 |
| 11/10/2020 |  |  |  |  |  |  |  |  |  | 30,000 |  | (3) | 338,700 |

(1) Except as otherwise indicated, options vest as to 25% of the shares on the one-year anniversary of the grant date and the remaining vest at a rate of 1/36 th of the shares monthly thereafter. Vesting is subject to continued service through each vesting date.
(2) These RSUs vest in three equal installments on each of the first three anniversaries of the date of grant.
(3) PSUs become eligible to vest upon the achievement of certain stock price targets. Vesting is also subject to continued employment with the Company through the applicable vesting dates, with 25% of the shares eligible to vest on the one-year anniversary of the grant date and the remaining shares eligible to vest in equal installments each quarterly anniversary thereafter. For more information related to these awards, see “Compensation Discussion and Analysis” above.
(4) Based on the closing price of our common stock of $11.29 per share on The Nasdaq Global Market on December 31, 2020.
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Stock Vested in Fiscal 2020

The following table provides information concerning the vesting of restricted stock units issued to our named executive officers during the year ended December 31, 2020:

|  | Stock Awards
Name |  | Number of Shares Acquired on Vesting (#) |  | Value Realized on Vesting(1) ($)
Ramzi Haidamus |  | 123,271 |  | 889,841
Michael Okada |  | 25,934 |  | 177,129
Jared Smith |  | 26,667 |  | 181,336
Len Wood |  | — |  | —
Aaron Akerman |  | — |  | —

(1) Calculated by multiplying the number of vested RSUs by the market value of our common stock on the vesting date, which was the closing price of our common stock on such date as traded on the Nasdaq Global Market
Stock Options Exercised in Fiscal 2020

The following table provides information concerning the exercise of stock options issued to our named executive officers during the year ended December 31, 2020:

|  | Stock Options Exercised
Name |  | Number of Shares Acquired on Exercise (#) |  | Value Realized on Exercise(1) ($)
Ramzi Haidamus |  | — |  | —
Michael Okada |  | 61,500 |  | 94,276
Jared Smith |  | — |  | —
Len Wood |  | — |  | —
Aaron Akerman |  | — |  | —

(1) Calculated by multiplying the number of exercised stock options by the sale price of our common stock on the exercise date, less the exercise price for the stock option.
Potential Payments upon Termination or Change in Control
We have entered into the following agreements with each of Messrs. Smith, Okada and Akerman that provide for severance and additional benefits in connection with termination or change in control:
Mr. Jared Smith and Mr. Michael Okada
We entered into Retention and Ownership Change Event Agreements with Mr. Smith and Mr. Okada, which provide that in the event their employment is terminated without cause or they resign for good reason, they would be entitled to receive (i) a lump sum severance payment equal to 6 months base salary at their final base salary rate; and (ii) payments for COBRA premiums for up to 6 months following their termination date.
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In the event that, within one year following a change in control, Mr. Smith or Mr. Okada’s employment is terminated without cause or they resign for good reason, they would be entitled to receive (a) a lump sum severance payment equal to 12 months base salary at their final base salary rate; (b) health insurance premium payments for up to 12 months following their terminate date; and (c) immediate vesting of 100% of their then-unvested equity awards.
Payment of the foregoing benefits is conditioned upon execution of a general release of claims.
Mr. Aaron Akerman
We entered into a Retention and Ownership Change Event Agreement with Mr. Akerman, which provides that in the event his employment is terminated without cause or he resigns for good reason, he would be entitled to receive (i) a lump sum severance payment equal to 12 months base salary at his final base salary rate; and (ii) health insurance premium payments for up to 12 months following his termination date.
In the event that, within one year following a change in control, Mr. Akerman’s employment is terminated without cause or he resigns for good reason, he would be entitled to receive (a) a lump sum severance payment equal to 12 months base salary at his final base salary rate; (b) health insurance premium payments for up to 12 months following his terminate date; and (c) immediate vesting of 100% of his then-unvested equity awards.
Payment of the foregoing benefits is conditioned upon execution of a general release of claims.
The following table sets forth the benefit that would have been realized by our named executive officers as of December 31, 2020, if such officer’s employment had been terminated on that date (other than for cause), and the benefit that would have been realized by each named executive officer as of December 31, 2020, if a change in control had occurred on or before such date:

|  | Event
Named Executive Officer |  | Termination without cause or resignation for “good reason” or constructive reason |  | Termination without cause or resignation for “good reason” or constructive reason occurs due to a change in control
Michael Okada |  |  |  |
Severance |  | 171,450 |  | 342,900
COBRA Benefits |  | 15,957 |  | 31,915
Equity Acceleration |  | — |  | 1,938,492
TOTAL |  | 187,407 |  | 2,313,307
Jared Smith |  |  |  |
Severance |  | 182,500 |  | 365,000
COBRA Benefits |  | 24,847 |  | 49,693
Equity Acceleration |  | — |  | 2,688,856
TOTAL |  | 207,347 |  | 3,103,549
Aaron Akerman(1) |  |  |  |
Severance |  | 208,247 |  | 208,247
Health Insurance Benefits |  | 4,110 |  | 4,110
Equity Acceleration |  | — |  | 1,635,800
TOTAL |  | 212,357 |  | 1,848,157

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(1) Amounts payable in Canadian dollars have been converted to U.S. dollars using the average daily exchange rates from January 1, 2020 to December 31, 2020 of CAD $1 to USD $0.75.
Dollar amounts include potential severance payout, potential health insurance payments and potential equity award acceleration based on the fair market value of our common stock on December 31, 2020 less the exercise price in the case of stock options.
Mr. Ramzi Haidamus
Effective on November 3, 2020, Mr. Haidamus departed as Chief Executive Officer and director of the Company. In connection with his departure, the Company and Mr. Haidamus entered into a Separation Agreement and General Release, dated November 3, 2020 (the “Separation Agreement”), pursuant to which, in consideration for a general release in favor of the Company and Mr. Haidamus’ continuing observation and performance of the terms of the Separation Agreement:
•Mr. Haidamus received a lump sum payment in the amount of $472,498, subject to all legally required payroll withholdings; and
•Mr. Haidamus will be reimbursed for COBRA premiums (inclusive of medical, dental and vision) for the thirteen-month period from December 1, 2020 through December 31, 2021, subject to conditions set forth in the Separation Agreement.
In consideration for a release of claims from Mr. Haidamus relating to the Age Discrimination in Employment Act of 1967 in favor of the Company, Mr. Haidamus received a lump sum payment of approximately $65,463.36, subject to all legally required payroll withholdings. In addition, 11,208 unvested shares of the Company’s common stock subject to an option granted to Mr. Haidamus on February 14, 2019 accelerated and became vested.
CEO Pay Ratio

As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of Regulation S-K, we are providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of our Chief Executive Officer (CEO) for 2020. We had two CEOs during 2020: Mr. Ramzi Haidamus, our former CEO, and Mr. Jared Smith, our current Interim CEO. In accordance with Item 402(u) of Regulation S-K, we have elected to identify the median employee as of December 31, 2020. Accordingly, we have used Mr. Smith’s compensation for purposes of calculating our CEO pay ratio, as described below.
For 2020:
•the annual total compensation of the employee identified at the median of our company (other than our current CEO) was $117,710;
•the annual total compensation of our CEO (Mr. Smith, as described below) for purposes of determining the CEO Pay Ratio was $1,275,049;
•the ratio of the annual total compensation of our CEO to the median of the annual total compensation of our median employee was estimated to be 11 to 1.
We believe this ratio which was calculated in a manner consistent with SEC rules to be a reasonable estimate based upon the assumptions and adjustments described below.
.
Multiple CEOs. We had two CEOs during 2020: Mr. Ramzi Haidamus, our former CEO, served until November 3, 2020 at which time we appointed Mr. Jared Smith as Interim Chief Executive Officer. Due to
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the fact that Mr. Smith was our CEO on the date we used to identify our median employee, we have used Mr. Smith’s compensation as Interim CEO (including his base salary as of December 31, 2020), but annualized, as if he had been employed as Interim CEO for the entire measurement period, to calculate the pay ratio listed above.
Calculation Methodology. For 2020, we identified the employee with compensation at the median of the annual total compensation of all our employees using the following methodology:
In determining our employee population, we considered the individuals, excluding our CEO, who were employed by us and our consolidated subsidiaries on December 31, 2020, whether employed on a full-time, part-time, seasonal or temporary basis. We did not include any contractors or other non-employee workers in our employee population. Our employee population consisted of 53 individuals globally (excluding our CEO) as of December 31, 2020.
To identify the “median employee” from our employee population, we chose to use a consistently-applied compensation measure, which we selected as base salary or wages paid to each of our employees during the 12-month period ending December 31, 2020. For employees paid other than in U.S. dollars, we converted their compensation to U.S. dollars using foreign exchange rates in effect on December 31, 2020. For permanent employees hired during 2020, we annualized their base salary or wages as if they had been employed for the entire measurement period. We did not make any cost-of-living adjustments for employees outside of the United States.
Using this methodology, we identified the individual at the median of our employee population who was based in the United States. We then calculated the annual total compensation for this individual using the same methodology we use to calculate the amount reported for our CEO as described above.
The SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.
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EQUITY COMPENSATION PLAN INFORMATION
The following table provides information as of December 31, 2020 concerning our equity compensation plans:

Plan Category |  | Number of Securities to be Issued Upon Exercise of Outstanding Options Warrants and Rights (a) |  | Weighted- Average Exercise Price of Outstanding Options Warrants and Rights (b) |  | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c) |
Equity Compensation Plans Approved by Security Holders(1) |  | 828,188 |  | 8.16 |  | 3,252,702 | (2)
Equity Compensation Plans Not Approved by Security Holders(3) |  | — |  | — |  | — |
TOTAL |  | 828,188 |  | 8.16 |  | 3,252,702 |

(1) Consists of two plans: the Immersion Corporation 2007 Equity Incentive Plan and the 2011 Equity Incentive Plan. Excludes purchase rights under the Employee Stock Purchase Plan.
(2) Includes 230,881 shares available for future issuance under the Employee Stock Purchase Plan.
(3) As of December 31, 2020, there were no equity compensation plans not approved by security holders.
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AUDIT COMMITTEE REPORT
This report of the Audit Committee is required by the Securities and Exchange Commission, and is not to be deemed “soliciting material,” is not to be deemed “filed” with the Securities and Exchange Commission and is not to be incorporated by reference in any filing of Immersion Corporation under the 1933 Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any filing.
Under the guidance of a written charter adopted by our Board, the purpose of our Audit Committee is to retain an independent registered public accounting firm, to make such examinations as are necessary to monitor the corporate financial reporting of the internal and external audits and its subsidiaries, to provide to the Board the results of its examinations and recommendations derived there from, to outline to the Board the improvements made, or to be made, in internal accounting controls, and to provide the Board with such additional information and materials as it may deem necessary to make the Board aware of significant financial matters that require the attention of the Board.
Management is primarily responsible for the system of internal controls and the financial reporting process. The independent registered public accounting firm is responsible for expressing an opinion on the financial statements based on an audit conducted in accordance with generally accepted auditing standards. Our Audit Committee is responsible for monitoring and overseeing these processes.
In this context and in connection with the audited financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2020, our Audit Committee:
•reviewed and discussed the audited financial statements with management;
•discussed with Armanino LLP, with and without management present, the matters required to be discussed by Auditing Standard No. 1301 adopted by the Public Company Accounting Oversight Board (United States) regarding “Communications with Audit Committees”;
•received the written disclosures and the letter from Armanino LLP required by the applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountant's communications with the Audit Committee concerning independence; discussed with the independent registered public accounting firm its independence; and concluded that the non-audit services performed by Armanino LLP are compatible with maintaining its independence; and
•based on the foregoing reviews and discussions, recommended to the Board that the audited financial statements be included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 for filing with the SEC.

| AUDIT COMMITTEE
| Mathew Frey (Chairman)
| Franz Fink
| Sumit Agarwal

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RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PROPOSAL 2)
We are asking our stockholders to ratify the Audit Committee’s engagement of Armanino LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2021. In the event the stockholders fail to ratify the appointment, our Audit Committee will reconsider its engagement. Even if the engagement is ratified, our Audit Committee, in its discretion, may direct the engagement of a different independent registered public accounting firm at any time during the year if our Audit Committee feels that such a change would be in our and our stockholders’ best interest.
In accordance with standing policy, Armanino LLP periodically changes the personnel who work on the audit.
On April 8, 2020, the Audit Committee dismissed Deloitte & Touche LLP as the Company’s independent registered public accounting firm, effective upon completion of Deloitte’s review of the Company’s interim condensed consolidated financial information as of and for the three-month period ended March 31, 2020.
On April 8, 2020, the Audit Committee appointed Armanino LLP as the Company’s independent registered public accounting firm for the fiscal year ended December 31, 2020.
Deloitte’s reports on the Company’s consolidated financial statements for the fiscal year ended December 31, 2019 did not contain an adverse opinion or a disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principle.
During the fiscal year ended December 31, 2019, and the subsequent interim periods through April 8, 2020, there were (i) no disagreements with Deloitte on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, any of which, if not resolved to Deloitte’s satisfaction, would have caused Deloitte to make reference thereto in their report on the financial statements for such fiscal year, and (ii) no “reportable events” within the meaning of Item 304(a)(1)(v) of Regulation S-K.
Other than as disclosed in the next paragraph, during the fiscal year ended December 31, 2019, and the subsequent interim periods through April 8, 2020, neither the Company nor anyone on its behalf consulted with Armanino regarding (i) the application of accounting principles to a specific transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company’s financial statements, and neither a written report or oral advice was provided to the Company that Armanino concluded was an important factor considered by the Company in reaching a decision as to any accounting, auditing, or financial reporting issue, (ii) any matter that was the subject of a disagreement within the meaning of Item 304(a)(1)(iv) of Regulation S-K, or (iii) any reportable event within the meaning of Item 304(a)(1)(v) of Regulation S-K.
During the fiscal year ended December 31, 2019, and the subsequent interim periods through April 8, 2020, Armanino provided tax services to the Company consisting of a review of the Company’s quarterly and annual tax provision calculations, preparation of our annual tax returns and providing advice regarding the Company’s international tax structure. In approving the selection of Armanino as the Company’s independent registered public accounting firm, the Audit Committee considered these services previously provided by Armanino and concluded that such services would not adversely affect the independence of Armanino.
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Audit Fees and All Other Fees

The following table sets forth the aggregate fees billed to us for the fiscal years ended December 31, 2020 and 2019 by Deloitte:

|  | 2020 Fees |  | 2019 Fees
Audit Fees |  | $ 57,750 |  | $ 930,949
Audit-Related Fees |  | 87,450 |  | 172,668
Tax Fees |  | — |  | 14,125
All Other Fees |  | 2,099 |  | —
Total Fees |  | $ 147,299 |  | $ 1,117,742

The following table sets forth the aggregate fees billed to us for the fiscal year ended December 31, 2020 by Armanino:

|  | 2020 Fees
Audit Fees |  | $ 321,750
Audit-Related Fees |  | —
Tax Fees |  | 54,574
All Other Fees |  | 180,857
Total Fees |  | $ 557,182

Audit Fees. This category consists of the aggregate fees billed, or expected to be billed, for professional services rendered for the audits of our consolidated financial statements and the effectiveness of our internal controls over financial reporting, along with reviews of interim condensed consolidated financial statements included in quarterly reports, services that are normally provided by our independent registered accounting firm in connection with statutory and regulatory filings or engagements, and attestation services.
Audit-Related Fees. This category consists of the aggregate fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements and are not reported under “Audit Fees.”
Tax Fees. This category consists of the aggregate fees billed for tax compliance/preparation and other tax services. Tax compliance/preparation includes tax return preparation, claims for refunds, and tax payment planning services related to federal, state, and international taxes. Other tax services include tax advice, tax strategy and other miscellaneous tax consulting and planning primarily related to our reorganization of international operations.
All Other Fees. This category consists of the aggregate fees for all other services other than those reported above. Our intent is to minimize services in this category.
Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors

Our Audit Committee has determined that all services performed by Armanino are compatible with maintaining the independence of Armanino. In addition, since the effective date of the SEC rules stating that an independent public accounting firm is not independent of an audit client if the services it provides to the client are not appropriately approved, our Audit Committee has approved, and will continue to pre-
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approve all services provided by the independent registered public accounting firm. These services may include audit services, audit-related services, tax services, and other services. None of the services described above were approved by our Audit Committee pursuant to the waiver of pre-approval provisions set forth in applicable rules of the SEC.
Our Audit Committee has adopted a policy for the pre-approval of services provided by the independent registered public accounting firm, pursuant to which it may pre-approve certain audit fees, audit-related fees, tax fees, and fees for other services. Under the policy, our Audit Committee may also delegate authority to pre-approve certain specified audit or permissible non-audit services to one or more of its members. A member to whom pre-approval authority has been delegated must report his pre-approval decisions, if any, to our Audit Committee at its next meeting. Unless our Audit Committee determines otherwise, the term for any service pre-approved by a member to whom pre-approval authority has been delegated is twelve months.
Other Information

We have been advised by Armanino LLP that neither the firm, nor any member of the firm, has any financial interest, direct or indirect, in any capacity in us or our subsidiaries.
One or more representatives of Armanino will be present at this year’s Annual Meeting. The representatives will have an opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions.
Ratification of the appointment of the independent public accounting firm requires the affirmative vote of the majority of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote on Proposal 2. Abstentions will have the same effect as a vote “AGAINST” Proposal 2.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF Armanino LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.
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ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS (PROPOSAL 3)
In accordance with Section 14A of the Exchange Act, we seek a non-binding advisory vote from our stockholders to approve the compensation of our named executive officers as disclosed pursuant to Item 402 of Regulation S-K in the Compensation Discussion and Analysis section beginning on page 31 and the Executive Compensation section beginning on page 50. We have designed our compensation programs to align compensation with our annual and long-term business objectives and performance and to motivate executive officers to enhance long-term stockholder value. Consistent with the stockholders’ 2017 advisory vote on the frequency of holding an advisory vote on the compensation of our named executive officers, we are seeking an advisory vote on executive compensation every year until the next required stockholder vote on the frequency of stockholder votes on executive compensation.
At the annual meeting of our stockholders held in June 2020, approximately 72% of the total stockholders’ votes cast were cast in favor of the fiscal 2019 compensation of our named executive officers. The Compensation Committee has and will consider this result in future executive compensation decisions.
The Board recommends that the stockholders vote FOR the following resolution:
“RESOLVED, that the stockholders approve, on an advisory basis, the compensation of our named executive officers, as disclosed in this proxy statement, including the Compensation Discussion and Analysis, the executive compensation tables and the related narrative.”
Because your vote is advisory, it will not be binding upon the Company, the Board or the Compensation Committee. However, the Board values stockholders’ opinions and the Compensation Committee will consider the outcome of the vote when considering future executive compensation decisions.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ADVISORY VOTE TO APPROVE COMPENSATION OF THE NAMED EXECUTIVE OFFICERS.
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William Martin 03 - Eric Singer
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Annual Meeting Proxy Card
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1. Election of four (4) directors.
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ANNUAL MEETING OF STOCKHOLDERS
to be held on May 13, 2021
This Proxy is solicited on behalf of the Board of Directors
The undersigned stockholder of IMMERSION CORPORATION, a Delaware corporation (the “Company”), hereby acknowledges receipt of the Proxy Statement,
dated April 1, 2021, and hereby appoints Michael Okada, Jared Smith and any person then-serving in the role of Chief Executive Officer or General Counsel of
the Company, or any of them, proxies and attorneys-in-fact, with full power to each of substitution, on behalf and in the name of the undersigned, to represent
the undersigned at the Annual Meeting of Stockholders of IMMERSION CORPORATION to be held on Thursday, May 13, 2021, at 9:30 a.m., Pacific Time, at 330
Townsend Street, Suite 234, San Francisco, CA 94107, and for any adjournment or adjournments thereof, and to vote all shares of common stock, which the
undersigned would be entitled to vote if then and there personally present, on the matters set forth on the reverse side. Under Delaware law and the Company’s
bylaws, no business shall be transacted at an annual meeting other than the matters stated in the accompanying Notice of Meeting, which matters are set forth
on the reverse side. However, should any other matter or matters properly come before the Annual Meeting, or any adjournment or adjournments thereof, it
is the intention of the proxy holders named above to vote the shares they represent upon such other matter or matters at their discretion.
THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY DIRECTION IS INDICATED, WILL BE VOTED FOR APPROVAL OF THE PROPOSAL TO ELECT FOUR
DIRECTORS AND FOR PROPOSALS 2 AND 3 AND AT THE DISCRETION OF THE PROXIES UPON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING.
Please mark, sign, date and return the proxy card promptly, using the enclosed return-addressed postage-paid envelope.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
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Stockholder Meeting Notice
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Important Notice Regarding the Availability of Proxy Materials for the
Immersion Corporation Stockholder Meeting to be Held on May 13, 2021
Under Securities and Exchange Commission rules, you are receiving this notice that the proxy materials for the annual
stockholders’ meeting are available on the Internet. Follow the instructions below to view the materials and vote online or
request a copy. The items to be voted on and location of the annual meeting are on the reverse side. Your vote is important!
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Immersion Corporation Annual Meeting of Stockholders will be held on May 13, 2021 at 330 Townsend Street, Suite 234,
San Francisco, CA 94107, at 9:30 a.m. Pacific Time.
Proposals to be voted on at the meeting are listed below along with the Board of Directors’ recommendations.
The Board of Directors recommend a vote FOR all the nominees listed and FOR the following proposals:
1. Election of four (4) directors.
2. Ratification of appointment of Armanino LLP as Immersion Corporation’s independent registered public accounting firm for fiscal 2021.
3. Advisory vote on the compensation of our named executive officers.
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Stockholder Meeting Notice
Directions to the Immersion Corporation 2021 Annual Meeting
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