8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 23, 2012

INVENSENSE, INC.

(Exact Name of Registrant as Specified in Charter)

Delaware	001-35269	01-0789977
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
1197 Borregas Avenue Sunnyvale, California		94089
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code (408) 988-7339

(Former Name or Former Address, if Changed Since Last Report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

Effective October 24, 2012, Steven Nasiri, founder of InvenSense Inc. (the “Company”), stepped down as Chief Executive Officer, President and Secretary of the Company, and Behrooz Abdi, a director of the Company, was appointed as Chief Executive Officer and President. Mr. Nasiri will serve as Technical Advisor to the Company through the end of the calendar year to provide for an orderly transition, and he also continues to serve on the Company’s Board of Directors.

Mr. Abdi, age 50, has served on the Company’s Board of Directors since June 2011 and has worked extensively with the Board of Directors and the Company for the past 15 months. Prior to accepting the role as Chief Executive Officer and President of the Company, Mr. Abdi was an Executive Vice President and General Manager for NetLogic Microsystems, Inc., a leader in intelligent semiconductor solutions for the internet, since November 2009. Mr. Abdi served as the President and Chief Executive Officer of RMI Corporation (also known as Raza Microelectronics Inc.), a fabless semiconductor company, from November 2007 to October 2009. He served as Senior Vice President and General Manager of CDMA Technologies (QCT) at Qualcomm, Inc., a provider of wireless technology and services, from March 2004 to November 2007. Prior to joining Qualcomm, he held leadership and engineering positions at Motorola, Inc. where he served as Vice President and General Manager for Motorola’s radio products division, in charge of RF and mixed signal ICs for the wireless mobile market. He currently is a director at Tabula, Inc. and Exar Corporation. Mr. Abdi holds a B.S. from Montana State University and an M.S. from the Georgia Institute of Technology, both in Electrical Engineering.

In connection with Mr. Abdi’s appointment, the Company and Mr. Abdi entered into an employment agreement and an executive change in control and severance agreement, each dated October 23, 2012. Pursuant to the employment agreement, Mr. Abdi will receive an annual base salary of $400,000 per year, he will earn an annual performance bonus of $100,000, if bonuses are otherwise paid under the Company’s executive bonus plan for 2013, and he will participate in the future in any other bonus or similar plan for executive officers of the Company adopted by the Company’s Board of Directors.

In addition, under the employment agreement, Mr. Abdi was granted: (i) an option to purchase 829,540 shares of the Company’s common stock, at an exercise price equal to $11.56 per share, the closing price of the Company’s common stock on October 24, 2012, with one quarter of the shares subject to the option vesting on the one year anniversary of Mr. Abdi’s employment with the Company and the remaining shares vesting in equal monthly installments over the three years thereafter; (ii) an option to purchase 622,155 shares of the Company’s common stock, at an exercise price equal to $11.56 per share, with shares subject to the option vesting ratably at a rate of 1/48^th per month after commencement of vesting, and vesting commencing for such shares in even thirds of 207,385 shares upon the closing price of the Company’s publicly traded stock equaling or exceeding $15.00, $17.50 and $20.00, respectively, for periods of 20 consecutive trading days; and (iii) 414,770 shares of restricted common stock of the Company, with one quarter of the shares vesting on the one year anniversary of Mr. Abdi’s employment with the Company and the remaining shares vesting in equal monthly installments over the three years thereafter. In consideration for the Company’s entering into the employment agreement, Mr. Abdi agreed that no additional shares would vest under existing options granted to him in his capacity as a non-employee member of the Company’s Board of Directors covering an aggregate of 90,000 shares of the company’s common stock (that portion of these options which has already vested represents an option to purchase 28,125 shares for $7.32 per share).

Under the executive change in control and severance agreement, if Mr. Abdi resigns for good reason or is terminated without cause not in connection with a change in control of the Company, he is entitled to: (i) a severance payment equal to 16 months of his then-current base salary; (ii) a bonus payment equal to his target bonus amount for the prior fiscal year (or, if no such prior year target annual bonus has been established, for the current fiscal year); and (iii) a payment of 18 months of continued medical insurance premiums under COBRA, each of which shall be paid in single lump-sum amounts, subject to applicable withholding taxes. In addition, Mr. Abdi’s then-outstanding equity awards that have commenced vesting in accordance with their terms will vest in the additional portion that would have vested had Mr. Abdi’s service with the Company continued for an additional 12 months after the date of termination (but without giving effect to any change in the trading price of the Company’s common stock following the date of termination).

In addition, if he resigns for good reason or is terminated without cause within 90 days before or 18 months following a change in control of the Company, Mr. Abdi is entitled to: (i) a severance payment equal to 18 months of the greater of his then-current base salary or his base salary as in effect immediately prior to the change in control; (ii) a bonus payment equal to 150% of the weighted average of his target bonus amount for the year in which his termination occurs and for the bonus amount paid to him for the year prior to the year in which his termination occurs; and (iii) a payment of 18 months of continued medical insurance premiums under COBRA, each of which shall be paid in single lump-sum amounts, subject to applicable withholding taxes. In addition, 100% of Mr. Abdi’s then-outstanding equity awards that have commenced vesting in accordance with their terms will become vested (as if, with respect to equity awards the vesting of which is conditioned on the achievement by the Company of any common stock trading price, the Company’s common stock’s price had closed for 20 consecutive trading days at the price per share paid in the change in control), all restrictions and repurchase rights will lapse, and all performance goals or other criteria will be deemed achieved at target levels and all other terms and condition met.

Without regard to whether Mr. Abdi is terminated or resigns, upon a change in control of the Company, 100% of Mr. Abdi’s then-outstanding equity awards that are not assumed or replaced upon the change in control and that have commenced vesting in accordance with their terms will become vested (as if, with respect to equity awards the vesting of which is conditioned on the achievement by the Company of any common stock trading price, the Company’s common stock’s price had closed for 20 consecutive trading days at the price per share paid in the change in control).

Mr. Abdi’s entitlement to the above severance amounts and acceleration of vesting are subject to his execution of a release of claims in favor of the Company, and these amounts will be reduced to the extent that is necessary to result in no portion of such benefits being subject to excise tax under Internal Revenue Code Section 4999. Mr. Abdi also has signed and agreed to be bound by the terms of the Company’s employee proprietary information agreement.

There is no family relationship between Mr. Abdi and any director or executive officer and, outside of his employment relationship, he is not a party to any current or proposed transaction with the Company for which disclosure is required under Item 404(a) of Regulation S-K.

Mr. Nasiri and the Company entered into a transition and release agreement, dated October 23, 2012, under which Mr. Nasiri will continue to be employed as Technical Advisor to the Company through December 31, 2012 to provide transitional support to the Chief Executive Officer of the Company and other members of management. Pursuant to the agreement, 150,000 unvested shares of common stock subject to outstanding options held by Mr. Nasiri were immediately vested, and Mr. Nasiri will continue to receive his current base salary and will continue to vest in his existing options through the term of the agreement.

In addition, in satisfaction of obligations under Mr. Nasiri’s change in control and severance agreement with the Company, the Company agreed to (i) a payment to Mr. Nasiri of $300,000 in respect of his annual bonus, paid in a lump sum after Mr. Nasiri’s termination, (ii) an additional severance payment of $500,000, paid in the form of salary continuation for 16 months after Mr. Nasiri’s termination, and (iii) a payment of 18 months of continued medical insurance premiums under COBRA following Mr. Nasiri’s termination. In connection with the above severance amounts, and pursuant to the terms of his executive employment agreement with the Company, Mr. Nasiri agreed to a release of claims in favor of the Company.

The foregoing summary of the terms of the agreements entered into with Mr. Abdi and Mr. Nasiri does not purport to be complete and is qualified in its entirety by the employment agreement, the executive change in control and severance agreement and the transition and release agreement attached hereto as Exhibits 10.1, 10.2 and 10.3, respectively, which are incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit No.	Exhibit Description
10.1	Employment Agreement, dated as of October 23, 2012, by and between Behrooz Abdi and Invensense, Inc.
10.2	Executive Change in Control and Severance Agreement, dated as of October 23, 2012, by and between Behrooz Abdi and Invensense, Inc.
10.3	Transition and Release Agreement, dated as of October 23, 2012, by and between Steven Nasiri and Invensense, Inc.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	InvenSense, Inc.
Date: October 25, 2012	/s/ Alan Krock
	Alan Krock Vice President, Chief Financial Officer

EX-10.1

Exhibit 10.1

INVENSENSE, INC.

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is hereby entered into effective as of October 23, 2012 (the “Effective Date”), by and between INVENSENSE, INC., a Delaware corporation (the “Company”), and Behrooz Abdi (“Employee”) (collectively the “Parties”).

AGREEMENT

The Company wishes to employ Employee as the President and Chief Executive Officer of the Company and Employee wishes to be employed by the Company as the President and Chief Executive Officer of the Company. In consideration of these premises and for other good and valid consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Term of Employment. As used herein, the phrase the employment term (the “Employment Term”) refers to the entire period of employment of Employee by the Company hereunder, commencing on the date on which Employee commences service to the Company hereunder (the “Employment Start Date”).

2. Duties and Obligations of Employee.

(a) General Duties. Employee shall serve as the President and Chief Executive Officer (“CEO”) of the Company and will report to the Board of Directors (the “Board”). In his capacity as President and CEO, Employee shall do and perform all services, acts or things necessary or advisable as the President and Chief Executive Officer of the Company, subject at all times to policies established by the Board.

(b) Devotion to Company’s Business. Employee shall devote his entire productive time, ability and attention to the business of the Company during the Employment Term. Employee shall not engage in any other duties or other pursuits, or directly or indirectly render material services of a business, commercial or professional nature to any other person or organization, whether for compensation or otherwise, without the consent of the Board. The expenditure of reasonable amounts of time for educational, charitable or professional activities, for service on the boards of directors of Tabula, Inc. and Exar Corporation, and to provide limited advisory services to private companies in which Employee is an investor as of the date of this Agreement and which have been previously disclosed to the Board shall not be deemed a breach of this Agreement if those activities do not materially interfere with the services required under this Agreement. Employee shall obtain the prior approval of the Compensation Committee of the Board before making any investment in a privately held company greater than $50,000 or taking on any advisory role for such company.

INVENSENSE CORPORATION

EMPLOYMENT AGREEMENT WITH BEHROOZ ABDI

(c) Confidentiality.

(i) Employee will sign the Company’s standard Employee Proprietary Information Agreement in the form attached as Exhibit A.

(ii) The Employee must establish his identity and authorization to work as required by the immigration reform and control act of 1986 (IRCA).

3. Obligations of Company.

(a) General Description. The Company shall provide Employee with the compensation, incentives, benefits and business expense reimbursement specified elsewhere in this Agreement.

(b) Office and Staff. The Company shall provide Employee with a private office, office equipment, supplies and other facilities and services, suitable to Employee’s position and adequate for the performance of his duties.

4. Compensation and Rights of CEO.

(a) Base Salary. As compensation for the services to be performed hereunder, Employee shall receive an annual base salary of four hundred thousand dollars ($400,000), less applicable withholdings, payable periodically during the Employment Term in accordance with the Company’s standard payroll practices for U.S. employees. Employee’s annual base salary may be increased from time to time by the Board in its sole discretion. Employee’s annual base salary, including any increases to such salary, shall be referred to in this Agreement as the “Base Salary.”

(b) Other Compensation. In addition to the Base Salary, Employee’s compensation shall consist of the opportunity to receive certain other compensation, as follows

(i) The Company has established an executive bonus plan for fiscal 2013, which pays a bonus to executives based upon the Company’s performance against certain targets as of the end of fiscal 2013 and which is payable within four (4) weeks of the commencement of fiscal 2014. Employee’s target bonus for fiscal 2013 under the executive bonus plan shall be one hundred thousand dollars ($100,000), which bonus shall be paid (but not adjusted) if any bonuses are paid to executives under the bonus plan. Employee must be employed by the Company in good standing on the date of the distribution from the bonus plan in order to receive the distribution, regardless of the time period to which the distribution relates. The target bonus for Employee for future fiscal years shall be established by the Board in consultation with Employee in connection with the development of a bonus plan for Company executives for such fiscal years.

(ii) In the event that the Board hereafter establishes any other bonus or similar plan for executive officers of the Company, the Board shall include Employee as a participant in and beneficiary of such plan

INVENSENSE, INC.

EMPLOYMENT AGREEMENT WITH BEHROOZ ABDI

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(iii) In addition to the Stock Grant described in Section 5 below, Employee shall be entitled to periodic stock or option grants as may be approved by the Board in its sole discretion.

(c) Tax Withholding. The Company shall have the right to deduct or withhold from the Base Salary and other compensation due to Employee hereunder any and all sums required for federal income and Social Security taxes and all state or local taxes now applicable or that may be enacted and become applicable in the future.

5. Equity. As further compensation for the services to be performed hereunder, Employee shall be awarded certain rights to purchase or receive shares of the Company’s Common Stock as follows:

(i) Stock Option. On the Employment Start Date, the Company will grant Employee an option (“Option”) to purchase eight hundred twenty nine thousand five hundred forty (829,540) shares of Common Stock in accordance with the terms of the Company’s stock incentive plan and its standard option agreement, which shall vest in accordance with the terms and conditions outlined in the plan and agreement, and otherwise as described in this Agreement. The Option shall be exercisable at the fair market value of the Common Stock on the Employment Start Date and shall have a term of ten years. The shares subject to the Option (“Shares”) shall vest ratably over the four (4) year period commencing on the Employment Start Date (“Vesting Start Date”) as follows: 25% upon the 12 month anniversary of the Vesting Start Date, and at a rate of ¹/₄₈ of the number of shares initially subject to the Option for each full calendar month thereafter (such that 100% of the Shares shall be vested as of the fourth anniversary of the Vesting Start Date), provided that Employee is employed by the Company on each such vesting date, subject to acceleration as provided in the Executive Change in Control and Severance Agreement referred to in Section 8 below or as otherwise provided in the option agreement.

(ii) Performance Stock Option. On the Employment Start Date, the Company will grant Employee an option (“Performance Option”) to purchase six hundred twenty two thousand, one hundred fifteen (622,115) shares of Common Stock in accordance with the terms of the Company’s stock incentive plan and its standard option agreement, which shall vest in accordance with the terms and conditions outlined in the plan and agreement, and otherwise as described in this Agreement. The Performance Option shall be exercisable at the fair market value of the Common Stock on the Employment Start Date and shall have a term of ten years. Shares subject to the Performance Option shall commence vesting upon the closing price of the Company’s common stock on the New York Stock Exchange (or whatever national securities exchange or national automated quotation system on which the common stock is traded) equaling or exceeding, for a period of twenty (20) trading days, the prices indicated (adjusted for any stock splits or similar transactions):

Closing Price of	Shares Commencing to Vest
$15.00 or higher		207,385
$17.50 or higher		207,385
$20.00 or higher		207,385

INVENSENSE, INC.

EMPLOYMENT AGREEMENT WITH BEHROOZ ABDI

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The date on which such sustained closing price target is reached shall be referred to as the Second Option Vesting Start Date for the shares which commence vesting as a result. At such time as any shares subject to the Performance Option shall commence vesting, they shall vest ratably over four years at the rate of ¹/₄₈ of the number of such shares for each full calendar month thereafter (such that 100% of the Shares shall be vested as of the first anniversary of the relevant Second Option Vesting Start Date), subject to acceleration as provided in the Executive Change in Control and Severance Agreement referred to in Section 8 below or as otherwise provided in the option agreement.

In the event of a Change in Control (as defined in the Executive Change in Control and Severance Agreement referred to in Section 8 below), the above closing price targets (if not previously achieved) will be evaluated against the Change in Control deal price, and to the extent the deal price is equal to or greater than one or more closing price targets, those closing price targets shall be deemed achieved.

(iii) Restricted Stock. On the Employment Start Date, the Company will grant Employee four hundred fourteen thousand seven hundred seventy (414,770) shares of restricted Common Stock in accordance with the terms of the Company’s stock incentive plan, which shall vest in accordance with the terms and conditions outlined in the plan, and otherwise as described in this Agreement (the “Restricted Stock”). The Restricted Stock shall be vest ratably over the four (4) year period commencing on the first day of the Employment Term (“Vesting Start Date”) as follows: 25% upon the 12 month anniversary of the Vesting Start Date, and at a rate of 1/48 of the number of shares of restricted Common Stock initially granted each full calendar month thereafter (such that 100% of the Shares shall be vested as of the fourth anniversary of the Vesting Start Date), provided that Employee is employed by the Company on each such vesting date, subject to acceleration as provided in the Executive Change in Control and Severance Agreement referred to in Section 8 below or as otherwise provided in the restricted stock bonus agreement pursuant to which the restricted Common Stock is granted. If elected by Executive, the Company shall withhold shares sufficient to cover the minimum statutory withholding taxes due in connection with the grant or vesting of the Restricted Stock.

INVENSENSE, INC.

EMPLOYMENT AGREEMENT WITH BEHROOZ ABDI

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(iv) Existing Director Options. Employee was previously granted an option to purchase 90,000 shares of common stock of the Company at an exercise price of $7.32 per share on July 9, 2011 in connection with Employee’s commencement of service as a member of the Board of Directors of the Company (the “First Director Option”). The First Director Option vested at the rate of 1/48th of such shares for each month of service as a member of the Board. Employee was previously granted an option to purchase 20,000 shares of common stock of the Company at an exercise price of $10.18 per share on July 9, 2012 pursuant to the Company’s policies for compensation of non-employee members of the Board of Directors (the “Second Director Option”). The Second Director Option was to commence vesting at such time as the First Director Option is fully vested.

The Company and Employee agree that Employee is currently vested in options to purchase 28,125 shares of Company common stock under the First Director Option (the “Vested Director Options”), and options to purchase 0 shares of Company common stock under the Second Director Option. Employee agrees that, in consideration for the Company’s entering into this Agreement, no additional options shall vest under either the First Director Option or the Second Director Option. Company agrees that the Vested Director Options shall remain exercisable during the term of Employee’s service with the Company and for a period of time following any termination of Employee’s service with the Company that is identical to shorter of (x) the period of time Employee shall have to exercise the Option (as defined in Section 5(i) above) pursuant to the Executive Change in Control and Severance Agreement referred to in Section 8 hereof and (y) the expiration of the original term of the Vested Director Options.

6. Benefits.

(a) Annual Vacation. Employee shall be entitled to vacation time each calendar year, with full pay, in accordance with the Company’s standard policy.

(b) Illness. Employee shall be entitled to sick leave with full pay in accordance with the Company’s standard policy.

(c) Participation in 401(k) Savings Plan. Employee shall be eligible to participate in the Company’s 401(k) Savings Plan, on the same terms and conditions as all other similarly situated employees or where appropriate as determined by the CEO in its sole discretion.

(d) Medical, Dental, Disability; Life Insurance. The Company agrees to include Employee and Employee’s spouse and children, as appropriate and to the extent available, in the coverage of its medical, dental, disability, life, and Director and Officer Liability insurance policies in accordance with Company policies.

INVENSENSE, INC.

EMPLOYMENT AGREEMENT WITH BEHROOZ ABDI

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7. Reimbursement of Business Expenses.

(a) The Company shall promptly reimburse Employee for all reasonable business expenses incurred by Employee in connection with the business of the Company, all in accordance with the policies and procedures of the Company.

8. Termination of Employment; Executive Change in Control and Severance Agreement.

This Agreement shall be terminable at the will of the Company. Termination shall be effective upon such notice or as otherwise provided and no amounts shall be payable in connection therewith except amounts legally required to be paid, such as accrued but as yet unpaid compensation or accrued vacation, or as provided in accordance with the terms of the Executive Change in Control and Severance Agreement which is being executed by Executive and the Company at the same time as this Agreement is being signed. The Agreement shall also terminate upon Employee’s death or Disability (as defined in the Executive Change in Control and Severance Agreement). Upon termination, all rights, duties and obligations under this Agreement shall cease, except those set forth in Sections 2(c), 7(a), 8 and 9.

9. General Provisions.

(a) Notices. All notices, requests, demands and other communications required or permitted to be given to a Party pursuant to the provisions of this Agreement shall be in writing and shall be effective and deemed given to such party under this Agreement on the earliest of the following: (a) the date of personal delivery; (b) two (2) business days after transmission by facsimile, addressed to the other Party at its facsimile number, with confirmation of transmission; (c) three (3) business days after deposit with a nationally recognized overnight delivery courier for United States deliveries, marked for next-day delivery; and (d) five (5) business days after deposit in the United States mail by registered or certified mail (return receipt requested) for United States deliveries. All notices not delivered personally or by facsimile will be sent by certified first class mail, postage prepaid, return receipt requested, in any such case as follows (or to such other address as a Party may have advised the other Party by ten (10) days advance written notice in the manner provided in this Section 9(a)):

If to the Company:

Invensense Inc.

1197 Borregas Avenue

Sunnyvale, CA 94089

Attn: Chief Financial Officer

Telephone: 408 988 7339

INVENSENSE, INC.

EMPLOYMENT AGREEMENT WITH BEHROOZ ABDI

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If to Employee:

Behrooz Abdi

[address]

Telephone:                     

(b) Entire Agreement. This Agreement, together with the Executive Change in Control and Severance Agreement and the form of confidential information agreement and the standard forms of equity award agreements that describe Executive’s equity awards (other than as such equity award agreements have been revised pursuant to this Agreement), contains the entire agreement and understanding concerning the subject matter hereof between the Parties and supersedes and replaces all prior negotiations and proposed agreements, written and oral. Employee acknowledges that no other party, or any agent or attorney of any other party has made any promise, representation or warranty whatsoever, express or implied, not contained herein, concerning the subject matter hereof, to induce him to execute this Agreement or the Executive Change in Control and Severance Agreement, and Employee acknowledges that he has not executed either Agreement in reliance upon any such promise, representation or warranty not contained herein or therein.

(c) Modifications. Any modification of this Agreement shall only be effective if it is in writing and signed by the Party to be charged.

(d) Effect of Waiver. The failure of any Party to insist on strict compliance with any of the terms, covenants or conditions of the Agreement by any other Party shall not be deemed a waiver of that term, covenant or condition, nor shall any waiver or relinquishment of any right or power at any one time or times be deemed a waiver or relinquishment of that right or power for all or any other times.

(e) Partial Invalidity. If any provision of this Agreement is held to be invalid or unenforceable under a given circumstance, then the remaining provisions shall remain, nevertheless, in full force and effect under such circumstance. The Parties agree to renegotiate in good faith the term held invalid or unenforceable and to be bound by the mutually agreed substitute provision under such circumstances in order to give the most approximate effect intended by the Parties.

(f) Governing Law. This Agreement shall be governed by, interpreted under, construed and enforced in accordance with the laws of the State of California, excluding any choice of law principles which could cause the law of any other jurisdiction to be applied.

(g) Attorneys’ Fees. The Company shall reimburse Executive for the reasonable, documented attorneys’ fees incurred by Executive in connection with the drafting, negotiation and execution of this Agreement and any related documents in an amount not to exceed [$7,500].

(h) Counterparts; facsimile signatures. This Agreement may be executed in counterparts, each of which shall be deemed an original, but both of which together shall constitute one and the same instrument. This Agreement may also be executed and delivered by

INVENSENSE, INC.

EMPLOYMENT AGREEMENT WITH BEHROOZ ABDI

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facsimile and, upon such delivery, the facsimile will be deemed to have the same effect as if the original signature had been delivered to the other Party. The Parties agree to exchange original signatures, but the failure to deliver the original signature copy and/or the nonreceipt of the original signature copy shall have no effect upon the binding and enforceable nature of this Agreement.

(i) Indemnification and Insurance. The Company shall indemnify Executive to the full extent provided for in its corporate Bylaws and to the maximum extent that the Company indemnifies any of its other directors and senior executive officers, and he will be entitled to the protection of any insurance policies the Company may elect to maintain generally for the benefit of its directors and senior executive officers against all costs, charges, liabilities and expenses incurred or sustained by him in connection with any action, suit or proceeding to which he may be made a party by reason of his being or having been a director, officer or employee of the Company or any of its affiliates or his serving or having served any other enterprise, plan or trust as a director, officer, employee or fiduciary at the request of the Company or any of its affiliates (other than any dispute, claim or controversy arising under or relating to this Agreement (except for this Section 9(i))). The Company will enter into an indemnification agreement with the Executive in the standard form that it has or will adopt for the benefit of its other directors and senior executive officers. The provisions of this Section 9(i) shall survive any termination of the Executive’s employment or any termination of this Agreement.

INVENSENSE, INC.

EMPLOYMENT AGREEMENT WITH BEHROOZ ABDI

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AUTHORIZED SIGNATURES

For the purpose of binding the Parties to the above Agreement, the Parties or their duly authorized representatives have signed their names below, effective as of the Effective Date.

COMPANY: INVENSENSE INC.
By	/s/ Amit Shah
	Amit Shah, Director
EMPLOYEE:

/s/ Behrooz Abdi

     Behrooz Abdi

INVENSENSE, INC.

EMPLOYMENT AGREEMENT WITH BEHROOZ ABDI

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EX-10.2

Exhibit 10.2

INVENSENSE, INC.

EXECUTIVE CHANGE IN CONTROL AND SEVERANCE AGREEMENT

This Executive Change in Control and Severance Agreement (the “Agreement”) is made and entered into by and between Behrooz Abdi (“Executive”) and InvenSense, Inc. (the “Company”), effective as of October 23, 2012 (the “Effective Date”).

RECITALS

1. Executive is entering into an Employment Agreement with the Company as of the date hereof (the “Employment Agreement”). In connection with the negotiation of the Employment Agreement, Executive and the Board of Directors of the Company (the “Board”) desire to provide for the payment of certain benefits in connection with certain terminations of the Employment Agreement or in connection with a potential Change in Control (as defined herein) of the Company.

2. Certain capitalized terms used in the Agreement are defined in Section 5 below.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto agree as follows:

1. At-Will Employment. The Company and Executive acknowledge that Executive’s employment is and will continue to be at-will, as defined under applicable law.

2. Severance Benefits.

(a) Involuntary Termination other than in Connection with a Change in Control. If (i) Executive terminates his employment with the Company (or any parent, subsidiary or successor of the Company) for Good Reason (as defined herein) or (ii) the Company (or any parent, subsidiary or successor of the Company) terminates Executive’s employment without Cause (as defined herein) and such termination is not in Connection with a Change in Control, Executive will receive the following severance benefits from the Company, provided that Executive signs and does not revoke the release of claims as required by Section 3(a) and complies with the covenants set forth in Sections 3(b)-(d):

(i) Severance Payment. Executive will receive a severance payment equal to sixteen months of Executive’s then current annual salary as of the date of such termination paid in a single lump sum (less applicable withholding taxes).

(ii) Bonus Payment. Executive will receive a lump sum cash payment (less applicable withholding taxes) in an amount equal to Executive’s target annual bonus for the fiscal year prior to the year in which his termination occurs or, if no such prior year target annual bonus has been established, for the current fiscal year. In addition, Executive will receive the bonus earned for the prior fiscal year if not already paid.

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(iii) Equity Awards. Executive shall vest in that additional portion of any Equity Awards which have commenced to vest in accordance with their terms which would have vested in Executive had Executive’s service with the Company continued for a period of an additional twelve (12) months after the date of termination (but without giving effect to any change in the trading price of the Company’s common stock following the date of termination). Vested stock options shall remain exercisable for twelve (12) months (but not beyond the expiration of the term of the option). The Equity Awards will otherwise remain subject to the terms and conditions of the applicable Equity Award agreement.

(iii) Benefits. The Company agrees to pay a lump sum cash amount (subject to applicable withholding taxes) equal to the reasonably estimated cost for health continuation coverage premiums under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”)for Executive and any spouse and/or dependents of the Executive at the same level of health coverage as in effect on the day immediately preceding the date of termination for eighteen (18) months following the date of his termination. Executive may use this payment for such continuation coverage or for any other purpose.

(b) Involuntary Termination in Connection with a Change in Control. If (i) Executive terminates his employment with the Company (or any parent, subsidiary or successor of the Company) for Good Reason (as defined herein) or (ii) the Company (or any parent, subsidiary or successor of the Company) terminates Executive’s employment without Cause (as defined herein), and such termination is in Connection with a Change in Control, Executive will receive the following severance benefits from the Company, provided that Executive signs and does not revoke the release of claims as required by Section 3(a) and complies with the covenants set forth in Sections 3(b)-(d):

(i) Severance Payment. Executive will receive a single lump sum severance payment (less applicable withholding taxes) in an amount equal to eighteen (18) months of Executive’s annual salary, determined at a rate equal to the greater of (A) Executive’s annual salary as in effect immediately prior to the Change in Control, or (B) Executive’s then current annual salary as of the date of such termination.

(ii) Bonus Payment. Executive will receive a lump sum cash payment (less applicable withholding taxes) in an amount equal to one hundred fifty percent (150%) of the weighted average of (A) Executive’s target annual bonus for the year in which his termination occurs and (B) the annual bonus paid to Executive for the year prior to the year in which his termination occurs, with such weighted average determined based on the percentage of the current year completed prior to Executive’s termination. For example, if Executive’s target bonus for the year of termination is $275,000, the actual bonus paid to Executive for the year prior to the year in which his termination occurs was $200,000, and Executive completes 20% of the current year prior to his termination, the weighted average of these bonus amounts will be $215,000 (the sum of 20% of $275,000 and 80% of $200,000) and Executive will be entitled to 150% of such amount or $322,500.

In addition, Executive will receive the bonus earned for the prior fiscal year if not already paid.

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(iii) Equity Awards. One hundred percent (100%) of Executive’s then outstanding and unvested Equity Awards which have commenced to vest (or, in the case of any Equity Award the vesting of which is conditioned upon the achievement by the Company of any sustained common stock trading closing price at or above a specified level, would have commenced to vest had the stock trading closing price of the Company’s common stock for 20 consecutive trading days been equal to the price paid per share for the Company’s common stock in the Change in Control) as of the date of Executive’s termination of employment will become vested, all restrictions and repurchase rights will lapse, all performance goals or other vesting criteria will be deemed achieved at target levels and all other terms and conditions met. Vested stock options shall remain exercisable for twelve (12) months (but not beyond the expiration of the term of the option). The Equity Awards will otherwise remain subject to the terms and conditions of the applicable Equity Award agreement.

(iv) Benefits. The Company agrees to pay a lump sum cash amount (subject to applicable withholding taxes) equal to the reasonably estimated cost for health continuation coverage premiums under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) for Executive and any spouse and/or dependents of the Executive at the same level of health coverage as in effect on the day immediately preceding the date of termination for eighteen (18) months following the date of his termination. Executive may use this payment for such continuation coverage or for any other purpose.

(c) Timing of Severance Payments. Subject to Section 9 of this Agreement, the Company will pay or, as applicable, commence payment of the cash severance payments to which Executive is entitled under this Agreement in accordance with Section 3 of this Agreement.

(d) Voluntary Resignation; Termination For Cause. If Executive’s employment with the Company terminates (i) voluntarily by Executive (other than for Good Reason) or (ii) for Cause by the Company, then Executive will not be entitled to receive severance or other benefits except for those (if any) as may then be established under the Company’s then existing severance and benefits plans and practices or pursuant to other written agreements with the Company, including, without limitation, any Equity Award agreement.

(e) Disability; Death. If the Company terminates Executive’s employment as a result of Executive’s Disability, or Executive’s employment terminates due to his death, then Executive will not be entitled to receive severance or other benefits except for those (if any) as may then be established under the Company’s then existing written severance and benefits plans and practices or pursuant to other written agreements with the Company, including, without limitation, any Equity Award agreement.

(f) Exclusive Remedy. The provisions of this Section 2 are intended to be and are exclusive and in lieu of any other rights or remedies to which Executive or the Company may otherwise be entitled, whether at law, tort or contract, in equity, or under this Agreement. Executive will be entitled to no benefits, compensation or other payments or rights upon termination of employment without Cause or for Good Reason other than those benefits expressly set forth in this Section 2, except as may be provided in any Equity Award agreement.

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3A. Equity Benefits.

Without regard to whether Executive has a termination of employment, one hundred percent (100%) of Executive’s then outstanding and unvested Equity Awards which have commenced to vest (or, in the case of any Equity Award the vesting of which is conditioned upon the achievement by the Company of any sustained common stock trading closing price at or above a specified level, would have commenced to vest had the stock trading closing price of the Company’s common stock for 20 consecutive trading days been equal to the price paid per share for the Company’s common stock in the Change in Control) will vest immediately prior to a Change in Control in respect of any Equity Award that is not Assumed or Replaced (as such terms are currently defined in the Company’s 2011 Stock Incentive Plan) upon the Change in Control.

3. Conditions to Receipt of Severance.

(a) Release of Claims Agreement. The receipt of any severance or other benefits pursuant to Section 2 will be subject to Executive signing and not revoking a release of claims agreement in the form attached hereto as Exhibit A, and such release becoming effective and irrevocable within sixty (60) days of Executive’s termination or such earlier deadline required by the release (such deadline, the “Release Deadline”). No severance or other benefits will be paid or provided until the release of claims agreement becomes effective and irrevocable, and any severance amounts or benefits otherwise payable between the date of Executive’s termination and the date such release becomes effective shall be paid on the effective date of such release. Notwithstanding the foregoing, and subject to the release becoming effective and irrevocable by the Release Deadline, any severance payments or benefits under this Agreement that would be considered Deferred Compensation Separation Benefits (as defined in Section 9(a)) shall be paid on the sixtieth (60th) day following Executive’s “separation from service” within the meaning of Section 409A of the Code, or, if later, such time as required by Section 9(a). If the release does not become effective by the Release Deadline, Executive will forfeit all rights to severance payments and benefits under this Agreement. If Executive’s termination occurs within ninety (90) days prior to a Change in Control, and cash severance amounts have already become payable to Executive prior to the Change in Control under the provisions of Section 2(a) applicable to terminations that are not in Connection with a Change in Control, then Executive will be entitled to receive the severance benefits described in Section 2(b)(i)-(iii) reduced by amounts previously paid or vested pursuant to Section 2(a)(i)-(iii) and such benefits to which Executive has become entitled under Section 2(b) upon the Change in Control shall be paid to Executive on the Change in Control (or, if later, such time as required by Section 9(a)). For purposes of clarity, in no event will there be duplication of benefits under Sections 2(a) and (b).

(b) Non-Solicitation. Executive agrees that, while Executive is employed by the Company and for one (1) year thereafter, Executive shall not, in any capacity, whether for his own account or on behalf of any other person or organization, directly or indirectly, with or without compensation, solicit, divert or encourage any officers, directors, employees, agents, consultants or representatives of the Company (including any subsidiary), to terminate his, her or its relationship with the Company (including any subsidiary) or to become officers, directors, employees, agents, consultants or representatives of another business, enterprise or entity.

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(c) Non-Disparagement. The parties agree that, while Executive is employed by the Company and for one (1) year thereafter, (i) Executive shall not, directly or indirectly, make any statement, whether in commercial or non-commercial speech, disparaging or criticizing in any way the Company or any of its subsidiaries or affiliates, or any products or services offered by any of these entities, and (ii) none of the Company or its Board or executives shall, directly or indirectly, make any statement, whether in commercial or non-commercial speech, disparaging or criticizing in any way Executive; provided, however, that nothing herein or elsewhere shall prevent either party from making disclosures or truthful statements required by law or by any court, arbitrator, governmental body or other person with apparent authority to require such disclosures or statements.

(d) Other Requirement. Executive’s receipt of any payments or benefits under Section 2 will be subject to Executive continuing to comply with the terms of any form of confidential information agreement.

(e) No Duty to Mitigate. Executive will not be required to mitigate the amount of any payment contemplated by this Agreement, nor will any earnings that Executive may receive from any other source reduce any such payment.

4. Limitation on Payments. In the event that the severance and other benefits provided for in this Agreement or otherwise payable to Executive (i) constitute “parachute payments” within the meaning of Section 280G of the Code and (ii) but for this Section 4, would be subject to the excise tax imposed by Section 4999 of the Code, then, at the election of Executive, Executive’s severance benefits under Section 2 will be either:

(a) delivered in full, or

(b) delivered as to such lesser extent which would result in no portion of such severance benefits being subject to excise tax under Section 4999 of the Code,

whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the excise tax imposed by Section 4999, results in the receipt by Executive on an after-tax basis, of the greatest amount of severance benefits, notwithstanding that all or some portion of such severance benefits may be taxable under Section 4999 of the Code. Unless the Company and Executive otherwise agree in writing, any determination required under this Section 4 will be made in writing by the Company’s independent public accountants immediately prior to a Change in Control or a “Big Four” national accounting firm selected by the Company (the “Accountants”), whose determination will be conclusive and binding upon Executive and the Company for all purposes. For purposes of making the calculations required by this Section 4, the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code. The Company and Executive will furnish to the Accountants such information and documents as the Accountants may reasonably request in order to make a determination under this Section. The Company will bear all costs the Accountants may reasonably incur in connection with any calculations contemplated by this Section 4. Any reduction in payments and/or benefits required by this Section 4 shall occur in a manner necessary to provide Executive with the greatest economic benefit. If more than one

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manner of reduction of payments or benefits yields the greatest economic benefit, the payments and benefits shall be reduced pro rata. To the extent required to avoid a violation of Section 409A of the Code, in no event will the Company or Executive exercise any discretion with respect to the ordering of any reduction of payments or benefits pursuant to this Section 4.

5. Definition of Terms. The following terms referred to in this Agreement will have the following meanings:

(a) Cause. For purposes of this Agreement, “Cause” will mean:

(i) Executive’s performance of any act or failure to perform any act in bad faith in the performance of his duties hereunder and to the detriment of the Company (or any parent, subsidiary or successor of the Company), and such act or failure to act is not remedied within thirty (30) days after written notice from the Board, which written notice shall state that failure to remedy such act or failure to act may result in termination for Cause;

(ii) Executive’s dishonesty or intentional misconduct in the performance of his duties hereunder or material breach of a material provision of any agreement with the Company (or any parent, subsidiary or successor of the Company) which, if capable being cured, is not cured within thirty (30) days after written notice from the Board, which written notice shall state that failure to cure may result in termination for Cause; or

(iii) Executive’s commission of a crime involving dishonesty, breach of trust, or physical or emotional harm to any person which reflects conduct or character that the Board reasonably and in good faith determines is inconsistent with continued employment.

(b) Change in Control. For purposes of this Agreement, “Change in Control” shall mean any of the following transactions, provided, however, that the Company shall determine under parts (iii) and (iv) whether multiple transactions are related, and its determination shall be final, binding and conclusive:

(i) a merger or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the state in which the Company is incorporated; or

(ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company; or

(iii) any reverse merger or series of related transactions culminating in a reverse merger (including, but not limited to, a tender offer followed by a reverse merger) in which the Company is the surviving entity but (A) the shares of Company common stock outstanding immediately prior to such merger are converted or exchanged by virtue of the merger into other property, whether in the form of securities, cash or otherwise, or (B) in which securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities are transferred to a person or persons different from those who held such securities immediately prior to such merger or the initial transaction culminating in such merger; or

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(iv) acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities.

(c) Disability. For purposes of this Agreement, “Disability” means total and permanent disability as defined in Section 22(e)(3) of the Code.

(d) Equity Award. For purposes of this Agreement, “Equity Award” shall mean each then outstanding award relating to the Company’s common stock (whether stock options, stock appreciation rights, shares of restricted stock, restricted stock units, performance shares, performance units or other similar awards).

(e) Good Reason. For purposes of this Agreement and any Equity Award agreement, “Good Reason” means the occurrence of any of the following, without Executive’s express written consent:

(i) A reduction of Executive’s authority, duties or responsibilities;

(ii) A reduction in Executive’s base compensation;

(iii) A material change in the geographic location at which Executive must perform his services; provided that in no instance will the relocation of Executive to a facility or a location of fifty (50) miles or less from Executive’s then current office location be deemed material for purposes of this Agreement;

(iv) failure of the Company to obtain the assumption of this Agreement by any successor to the Company; or

(v) any material breach or material violation of a material provision of this Agreement by the Company (or any successor to the Company).

A termination of employment shall not be considered for “Good Reason” unless Executive provides written notice of the initial occurrence of one of the foregoing events to the Company within ninety (90) days thereafter, and provides the Company thirty (30) days to cure, and then terminates employment within eighteen (18) months following such initial occurrence. Executive specifically acknowledges and agrees that the definition of “Good Reason” in this Section 5(e) shall operate with respect to all rights to severance and/or accelerated vesting of any Equity Award paid upon a termination and shall supersede and replace in its entirety any other definitions of “Good Reason,” “Involuntary Termination,” or other similar terms that may exist in any other employment agreement, offer letter, severance plan or policy, Equity Award agreement or Company stock incentive plan document.

(f) In Connection with a Change in Control. A termination of Executive’s employment will be “in Connection with a Change in Control” if Executives employment terminates at any time on or within ninety (90) days before or eighteen (18) months following a Change in Control.

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6. Successors.

(a) Company Successors. Any successor to the Company (whether direct or indirect and whether by purchase, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company’s business and/or assets will assume the obligations under this Agreement and agree expressly to perform the obligations under this Agreement in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes under this Agreement, the term “Company” will include any successor to the Company’s business and/or assets which executes and delivers the assumption agreement described in this Section 6(a) or which becomes bound by the terms of this Agreement by operation of law.

(b) Executive’s Successors. The terms of this Agreement and all rights of Executive hereunder will inure to the benefit of, and be enforceable by, Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.

7. Notice.

(a) General. Notices and all other communications contemplated by this Agreement will be in writing and will be deemed to have been duly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of Executive, mailed notices will be addressed to him at the home address which he most recently communicated to the Company in writing. In the case of the Company, mailed notices will be addressed to its corporate headquarters, and all notices will be directed to the attention of the Company’s Chief Financial Officer.

(b) Notice of Termination. Any termination by the Company for Cause or by Executive for Good Reason or as a result of a voluntary resignation will be communicated by a notice of termination to the other party hereto given in accordance with Section 7(a) of this Agreement. Such notice will indicate the specific termination provision in this Agreement relied upon, will set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination under the provision so indicated, and will specify the termination date. The failure by Executive to include in the notice any fact or circumstance which contributes to a showing of Good Reason will not waive any right of Executive hereunder or preclude Executive from asserting such fact or circumstance in enforcing his rights hereunder.

8. Arbitration. The Company and Executive each agree that any and all disputes arising out of the terms of this Agreement, Executive’s employment by the Company, Executive’s service as an officer or director of the Company, or Executive’s compensation and benefits, their interpretation and any of the matters herein released, will be subject to binding arbitration. In the event of a dispute, the parties (or their legal representatives) will promptly confer to select a single arbitrator mutually acceptable to both parties. If the parties cannot agree on an arbitrator, then the moving party may file a demand for arbitration with the Judicial Arbitration and Mediation Services (“JAMS”) in Santa Clara County, California, who will be selected and appointed consistent with the Employment Arbitration Rules and Procedures of JAMS (the “JAMS Rules”), except that such arbitrator must have the qualifications set forth in

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this paragraph. Any arbitration will be conducted in a manner consistent with the JAMS Rules, supplemented by the California Rules of Civil Procedure. The parties further agree that the prevailing party in any arbitration will be entitled to injunctive relief in any court of competent jurisdiction to enforce the arbitration award. The parties hereby agree to waive their right to have any dispute between them resolved in a court of law by a judge or jury. This paragraph will not prevent either party from seeking injunctive relief (or any other provisional remedy) from any court having jurisdiction over the parties and the subject matter of their dispute relating to Executive’s obligations under this Agreement and the Company’s form of confidential information agreement.

9. Code Section 409A.

(a) Each payment and benefit payable under this Agreement is intended to constitute a separate payment for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations. Notwithstanding anything to the contrary in this Agreement, no Deferred Compensation Separation Benefits (as defined below) or other severance benefits that otherwise are exempt from Section 409A (as defined below) pursuant to Treasury Regulation Section 1.409A-1(b)(9) will be considered due or payable until Executive has a “separation from service” within the meaning of Section 409A of the Code, and the final regulations and any guidance promulgated thereunder (“Section 409A”). Further, if Executive is a “specified employee” within the meaning of Section 409A at the time of his separation from service (other than due to Executive’s death), then the severance benefits payable to Executive under this Agreement that are considered deferred compensation under Section 409A, if any, and any other severance payments or separation benefits that are considered deferred compensation under Section 409A, if any (together, the “Deferred Compensation Separation Benefits”) otherwise due to Executive on or within the six (6) month period following his separation from service will accrue during such six (6) month period and will become payable in a lump sum payment (less applicable withholding taxes) on the first payroll date that occurs on or after the date six (6) months and one (1) day following the date of Executive’s separation from service. All subsequent payments of Deferred Compensation Separation Benefits, if any, will be payable in accordance with the payment schedule applicable to each payment or benefit. If Executive dies following his separation from service but prior to the six (6) month anniversary of his date of separation, then any payments delayed in accordance with this paragraph will be payable in a lump sum (less applicable withholding taxes) to Executive’s estate as soon as administratively practicable after the date of his death and all other Deferred Compensation Separation Benefits will be payable in accordance with the payment schedule applicable to each payment or benefit.

(b) The foregoing provisions are intended to comply with the requirements of Section 409A so that none of the severance payments and benefits to be provided hereunder will be subject to the additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so comply. The Company and Executive agree to work together in good faith to consider amendments to this Agreement and to take such reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to Executive under Section 409A.

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10. Miscellaneous Provisions.

(a) Waiver. No provision of this Agreement will be modified, waived or discharged unless the modification, waiver or discharge is agreed to in writing and signed by Executive and by an authorized officer of the Company (other than Executive). No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other party will be considered a waiver of any other condition or provision or of the same condition or provision at another time.

(b) Headings. All captions and section headings used in this Agreement are for convenient reference only and do not form a part of this Agreement.

(c) Choice of Law. The validity, interpretation, construction and performance of this Agreement will be governed by the laws of the State of California (with the exception of its conflict of laws provisions).

(d) Integration. This Agreement, together with the Employment Agreement and the form of confidential information agreement and the standard forms of Equity Award agreement that describe Executive’s outstanding Equity Awards (other than as such Equity Award agreements have been revised pursuant to this Agreement), represents the entire agreement and understanding between the parties as to the subject matter herein and supersedes all prior or contemporaneous agreements whether written or oral. With respect to Equity Awards granted on or after the date of this Agreement, the acceleration of vesting provisions provided herein will apply to such Equity Awards except to the extent otherwise explicitly provided in the applicable Equity Award agreement. No waiver, alteration, or modification of any of the provisions of this Agreement will be binding unless in a writing and signed by duly authorized representatives of the parties hereto. In entering into this Agreement, no party has relied on or made any representation, warranty, inducement, promise, or understanding that is not in this Agreement. To the extent that any provisions of this Agreement conflict with those of any other agreement between the Executive and the Company, the terms in this Agreement will prevail.

(e) Severability. In the event that any provision or any portion of any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable, or void, this Agreement will continue in full force and effect without said provision or portion of provision. The remainder of this Agreement shall be interpreted so as best to effect the intent of the Company and Executive.

(f) Withholding. All payments made pursuant to this Agreement will be subject to withholding of applicable income and employment taxes.

(g) Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

(Remainder of page intentionally left blank)

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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year set forth below.

INVENSENSE, INC.	BEHROOZ ABDI
/s/ Amit Shah	/s/ Behrooz Abdi
Amit Shah, Director
10/23/12	10/23/12
Date	Date

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EXHIBIT A

GENERAL RELEASE

            (“you”) and InvenSense, Inc. (the “Company”) (collectively, “the parties”) have agreed to enter into this General Release (“Agreement”) on the following terms:

You acknowledge that your employment with the Company terminated effective             (the “Termination Date”). You further acknowledge that you have received your final paycheck, which includes your final salary or wages and pay for any accrued but unused vacation or personal days through your last day of employment, less withholdings. The parties acknowledge that except as provided for in this Agreement, all benefits and perquisites of employment cease as of your last day of employment.

Further, if you execute this Agreement to the satisfaction of the Company and return this Agreement to the Company within twenty-one (21) days following the Termination Date, and do not revoke the Agreement as permitted below, the Company will provide you with severance benefits under the terms of your Executive Change in Control and Severance Agreement with the Company dated as of October 23, 2012 (“ECICS Agreement”).

You understand and agree that you are not entitled to any compensation, benefits, remuneration, accruals, contributions, reimbursements, bonus, option grant, vesting, or vacation or other payments from the Company other than those expressly set forth in the ECICS Agreement, and that any and all payments and benefits you may receive under the ECICS Agreement are subject to all applicable taxes and withholdings. You further understand and agree that your eligibility for any Severance Benefits is subject to your compliance with the terms and conditions of the ECICS Agreement.

In exchange for Severance Benefits, you and your representatives completely release from, and agree to not file, cause to be filed or pursue against, the Company, its affiliated, related, parent or subsidiary companies, and its present and former directors, officers, and employees (the “Released Parties”) all claims, complaints, grievances or charges of any kind, known and unknown, which you may now have or have ever had against any of them, or arising out of your relationship with any of them, including all claims for compensation and bonuses, attorneys’ fees, and all claims arising from your employment with the Company or the termination of your employment, whether based on contract, tort, statute, local ordinance, regulation or any comparable law in any jurisdiction (“Released Claims”). By way of example and not limitation, Released Claims shall include any claims arising under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Age Discrimination in Employment Act (“ADEA”), the federal Worker Adjustment Retraining Notification Act (“WARN Act”) under 29 U.S.C. § 2102 et seq., the California WARN Act, California Labor Code § 1400 et seq., and the California Fair Employment and Housing Act (or any comparable law in any jurisdiction). Finally, you agree that with the exception of your final wages, all other payments and benefits referenced in the ECICS Agreement are in excess of any amounts to which you otherwise are legally entitled, and that these amounts shall be offset against any state or federal WARN Act (or other) notice or pay in lieu of notice obligation, if any, that the Company may be found to have in the future.

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You represent that you have not filed or initiated or caused to be filed or initiated any lawsuits, claims, complaints, administrative grievances or charges against any Released Party in any court or with any government agency.

In this paragraph, we provide you with specific information required under the ADEA. You acknowledge that you have received and reviewed any and all information required, if any, by the ADEA/Older Workers Benefit Protection Act pertaining to your termination from the Company. You agree that your release of claims in this Agreement includes a knowing and voluntary waiver of any rights you may have under the ADEA. You acknowledge that you have been given an opportunity to consider for twenty-one (21) days the terms of this Agreement, although you may sign beforehand, and that you are advised by the Company to consult with an attorney. You further understand that you can revoke your waiver of ADEA claims within seven (7) days of signing it, but that you will not be eligible for any Severance Benefits if you revoke your waiver. Revocation must be made by delivering a written notice of revocation to InvenSense, Inc., 1197 Borregas, Sunnyvale, California, Attention: Chief Financial Officer. You acknowledge and agree that for the revocation to be effective, the written notice must be received no later than the close of business (5:00 p.m. P.S.T.) on the seventh (7th) day after you sign this Agreement. This Agreement will become effective and enforceable on the eighth (8th) day following your execution of this Agreement, provided you have not exercised your right, as described herein, to revoke this Agreement. You further agree that any change to this Agreement, whether material or immaterial, will not restart the twenty-one (21) day review period.

You also agree that because this release specifically covers known and unknown claims, you waive your rights under Section 1542 of the California Civil Code or any other comparable statute of any jurisdiction, which states as follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT TO THE DEBTOR.”

Notwithstanding the foregoing, the parties acknowledge and agree that you are not waiving or being required to waive any right that cannot be waived as a matter of law, including the right to file a charge with or participate in an investigation by a governmental administrative agency; provided, however, that you hereby disclaim and waive any right to share or participate in any monetary award resulting from the prosecution of such charge or investigation. You further agree that, to the extent permissible by law, you will provide the Company at least five (5) days prior written notice of any such investigation. In addition, the parties acknowledge and agree that this release does not extend to (a) any rights to reimbursement or indemnification you may have pursuant to any written agreement with the Company, or any parent or subsidiary of the Company, to which you are a party, the charter, bylaws or other governing documents of the Company, or any parent or subsidiary of the Company, or under applicable law, or under directors and officers liability, errors and omissions or other insurance policies including any run-off endorsement relating thereto, or otherwise; (b) any rights or claims to contribution you may have in the event of the entry of judgment against you as a result of any act or failure to act

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for which both you and the Company or any parent or subsidiary of the Company (or the directors, officers, employees, shareholders, partners, agents, attorneys, predecessors, successors, parent or subsidiary entities, insurers, affiliates or assigns of any of them) are jointly responsible; or (c) any vested rights under a Company-sponsored benefit plan or other accrued obligations expressly set forth in the ECICS Agreement.

You agree not to disclose any confidential or proprietary information or know-how belonging to the Company or acquired by you during your employment with the Company as described in your Proprietary Information and Invention Assignment Agreement with the Company (“PIA”). You acknowledge that the PIA that you signed upon your hire remains in effect after your employment with the Company ends.

You and the Company further agree that the sole remedy for any and all disputes arising out of or based on the validity, terms, interpretation, application, or alleged breach of this Agreement, including any of the Released Claims (“Arbitrable Claims”), shall be binding arbitration, which shall be conducted in Santa Clara County, California, before a single arbitrator, in accordance with the then applicable rules of the Judicial Arbitration and Mediation Service (“JAMS”) or by a non-JAMS process to which the parties may otherwise agree. By agreeing to arbitrate, the parties are waiving their respective rights to a jury trial with regard to any of the above-referenced claims.

Notwithstanding anything to the contrary in the ECICS Agreement, no Severance Benefits for which you may be eligible shall be paid or otherwise provided until you have had a “separation from service” within the meaning of Section 409A of the Internal Revenue Code, the final regulations or any guidance promulgated thereunder (collectively, “Section 409A”).

The provisions in this Agreement are intended to comply with the requirements of Section 409A so that none of the Severance Benefits to be provided hereunder will be subject to the additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so comply. You ultimately will be responsible for any of your own taxes or similar costs or payments.

This Agreement is the entire agreement and understanding between you and the Company concerning its subject matter, replaces and supersedes any and all prior agreements and understandings between us, and may only be amended in writing signed by you and an authorized representative of the Company. It is agreed that this Agreement shall be governed by the laws of the State of California. If any provision of this Agreement or the application thereof to any person, place, or circumstance shall be held by a court of competent jurisdiction to be invalid, unenforceable, or void, the remainder of this Agreement and such provision as applied to other person, places, and circumstances shall remain in full force and effect.

Finally, by your signature below, you acknowledge each of the following: (a) that you have read this Agreement or have been afforded every opportunity to do so; (b) that you are fully aware of the Agreement’s contents and legal effect; and (c) that you have voluntarily chosen to enter into this Agreement, without duress or coercion, economic or otherwise, and based upon your own judgment and not in reliance upon any promises made by Company other than those contained in this Agreement.

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UNDERSTOOD AND AGREED:

	DATE:
Behrooz Abdi
	DATE:
By:
InvenSense, Inc.

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EX-10.3

Exhibit 10.3

EXECUTION COPY

TRANSITION AND RELEASE AGREEMENT

This Transition and Release Agreement (the “Agreement”) is entered into as of October 23, 2012, by and among InvenSense, Inc. (the “Company”) and Steven Nasiri (“Executive”) (collectively, the “Parties”).

1. Resignation as Chief Executive Officer. Executive shall resign from his positions as the Company’s President, Chief Executive Officer and Secretary and as a member of the boards of directors of subsidiaries of the Company effective on October 23, 2012 (the “Effective Date”).

2. Equity. On the Effective Date, Executive shall vest in that number of options in which Executive would vest over the 12 month period following the Effective Date and such options shall be fully exercisable. The exercise period for each of Executive’s vested option grants shall expire on the earlier of the date that is 12 months following the Service Termination Date (as defined below) or the expiration date set forth in Executive’s applicable option agreement. For avoidance of doubt, the Parties acknowledge that this accelerated vesting shall apply to options to purchase 150,000 shares of common stock. Schedule 1 to this Agreement sets forth a complete statement of Executive’s existing exercisable options and options which shall be vested as a result of the execution and performance of this Agreement and Executive’s provision of services to the Company through the Service Termination Date. Each option will continue to be governed by all other terms and conditions of the applicable option agreement, except as expressly modified hereby. Executive acknowledges that the outstanding options which were originally intended to qualify as incentive stock options, as defined in Section 422 of the Internal Revenue Code of 1986, as amended, will cease to so qualify upon the Effective Date.

3. Transitional Assistance. The Parties have agreed that after the Effective Date, Executive shall serve the Company as an employee with the title of Technical Adviser or such other title, if any, that may be mutually agreed, reporting to the Chief Executive Officer of the Company, through December 31, 2012 (the “Service Termination Date”) at which time his employment with the Company shall terminate. During the period between the Effective Date and the Service Termination Date (the “Transition Period”), Executive shall provide transitional support to the Chief Executive Officer and other members of management. During the Transition Period, Executive will continue to receive his current base salary and continue to vest in existing options held by him. Employee shall not accrue any right to receive additional compensation in the form of a performance or other bonus during the Transition Period. On the Service Termination Date, Executive shall receive payment of his accrued but unused vacation time. Except as specifically provided herein, all benefits and perquisites of employment will cease as of the Service Termination Date or any earlier decision by Executive to terminate his services as an employee of the Company (in which case, such earlier date shall be considered the Service Termination Date for purposes of this Agreement). The Parties specifically acknowledge and agree that the level of services to be provided by Executive during the Transition Period is intended to equal at least fifty percent (50%) of the average level of bona fide services performed by Executive over the thirty-six (36) month period preceding the Effective Date, and thus the Executive will not, as of the Effective Date, incur a “separation from

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service” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and all regulations, guidance, and other interpretative authority issued thereunder (collectively, “Section 409A”)

4. Board of Directors. Executive will continue to serve as a member of the Board of Directors of the Company through the expiration of his current term in 2014, or at such earlier time as he may choose to resign from the Board or that he is removed from the Board by action of the stockholders of the Company as provided by law. Executive shall not be entitled to receive additional compensation from the Company by reason of such service on the Board, other than reimbursement of any expenses incurred by Executive pursuant to the Company’s then current policies for reimbursement of expenses to Board members.

5. Severance.

(a) In accordance with the terms and conditions of Section 2(a) of the Change in Control and Severance Agreement agreed to by and between the Company and Executive, Executive is entitled to receive severance payments equal to (i) twelve (12) months of Executive’s current base salary paid according to the Company’s regular payroll schedule over the 12 month period following the date of his termination, subject to Section 5(b) below, and (ii) a lump sum cash payment (less applicable withholding taxes) in an amount equal to the lesser of Executive’s target bonus for the Company’s fiscal year ending March 31, 2013 and the amount paid to Executive as his bonus for the Company’s fiscal year ending April 2, 2012. With respect to the payment described in Section 5(a)(ii), the Parties have agreed that the amount payable in satisfaction of this obligation will be $300,000. In addition, the Company has agreed to provide Executive with an additional four months of continued base salary following the expiration of the initial twelve (12) month period described in Section 5(a)(ii), resulting in a total of 16 months of continued base salary which will be paid according to the Company’s regular payroll schedule over the 16 month period following the date of his termination, subject to Section 5(b). For the avoidance of doubt, the Parties acknowledge that the total of all severance payments paid pursuant to this paragraph will equal Eight Hundred Thousand Dollars ($800,000), less applicable tax withholdings.

(b) Each payment and benefit payable under this Agreement is intended to constitute a separate payment for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations. Notwithstanding anything to the contrary in this Agreement, the severance benefits set forth in Sections 5(a) and 6 will not be considered due or payable until Executive has a “separation from service” within the meaning of Section 409A. Further, because Executive will be a “specified employee” within the meaning of Section 409A at the time of his separation from service, the severance benefits payable to Executive pursuant to Section 5(a) on or within the six month period following his separation from service will accrue during such six month period and will become payable in a lump sum payment (less applicable withholding taxes) on the first payroll date that occurs on or after the date six months and one day following the date of Executive’s separation from service. All subsequent severance payments will be payable in accordance with the payment schedule applicable to each payment or benefit. If Executive dies following his separation from service but prior to the six month anniversary of his date of separation, then any payments delayed in accordance with this paragraph will be payable in a lump sum (less applicable withholding taxes) to Executive’s estate as soon as administratively

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practicable after the date of his death and all other severance payments and benefits will be payable in accordance with the payment schedule applicable to each payment or benefit. The foregoing provisions are intended to comply with the requirements of Section 409A so that none of the severance payments and benefits to be provided hereunder will be subject to the additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so comply. The Company and Executive agree to work together in good faith to consider amendments to this Agreement and to take such reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to Executive under Section 409A.

6. COBRA. If the Executive and any other person who is a spouse, domestic partner, or dependent of Executive (“Family Members”) has coverage on the Service Termination Date under a group health plan sponsored by the Company, the Company agrees to pay for health continuation coverage premiums for Executive and such Family Members at the same level of health coverage as in effect on the day immediately preceding the Service Termination Date, as applicable; provided, however, that (1) Executive constitutes a qualified beneficiary, as defined in Section 4980(B)(g)(1) of the Internal Revenue Code of 1986, as amended (the “Code”); and (2) Executive elects continuation coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), within the time period prescribed pursuant to COBRA. The Company will pay such COBRA premiums to provide for continuation benefits on behalf of the Executive and such Family Members for 18 months following the Service Termination Date. Executive will thereafter be responsible for the payment of COBRA premiums (including, without limitation, all administrative expenses) for any remaining COBRA period.

7. Release of Claims. In exchange for the benefits provided herein, and as required as a condition to receipt of such benefits by the Executive Employment Agreement dated April 14, 2004 to which Executive and the Company are a party, and by the Company’s policies concerning severance and change in control payments payable to executive officers of the Company, Executive completely releases the Company and its subsidiary corporations, and its and their present and former directors, officers, and employees from, and agrees not to file, cause to be filed, or otherwise pursue, any and all claims Executive may now have or has ever had against any of them, including but not limited to claims for compensation, bonuses, severance pay, stock options, and all claims arising from Executive’s employment or the termination of that employment (including, without limitation, any claims arising under the Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the WARN Act or any state counterpart, the California Fair Employment and Housing Act, or any other claims for violation of any federal, state, or municipal statutes), and any and all claims for attorneys’ fees and costs.

Notwithstanding the foregoing, the Company is not released from any obligations (whether under its Certificate of Incorporation, Bylaws, applicable state law, any indemnification agreement or otherwise) to indemnify and defend Executive from and against all claims brought against Executive by stockholders or third parties, including without limitation any stockholder derivative suit, by reason of his status as an officer or director of the Company or the actions of the Company or the Board of Directors of the Company while he was an officer (collectively “Indemnification Claims”.) As such, any obligations of Company under any Indemnification Agreement between Company and Executive shall continue to be in effect with respect to such Indemnification Claims and with respect to Executive’s continued service as a member of the Board of Directors.

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Executive acknowledges that he has 21 days to consider this Agreement (but may elect to sign it at any time beforehand), and may consult an attorney in doing so. Executive also acknowledges that he may revoke this Agreement within 7 days of signing it by sending a certified letter to that effect to InvenSense, Inc., 1197 Borregas, Sunnyvale, California 94089 Attention: Chief Financial Officer. Executive understands and agrees that this Agreement shall not become effective or enforceable and no payments or benefits will be provided hereunder until the 7-day revocation period has expired.

8. Waiver of Unknown Claims. Executive agrees that because the foregoing release specifically covers known and unknown claims, Executive waives any rights under Section 1542 of the California Civil Code, or under any comparable law of any other jurisdiction. Section 1542 states: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or his favor at the time of executing the release, which if known by him or his must have materially affected his or his settlement with the debtor.”

9. Non-Disclosure of Company Information. Executive agrees to keep confidential and not to disclose any and all trade secrets or confidential information of the Company and/or its customers. Executive acknowledges his continuing obligations under the Proprietary Rights and Information Agreement that he signed with the Company.

10. Dispute Resolution. The Parties agree that any and all disputes arising out of the terms of this Agreement, their interpretation, and any of the matters herein being released, shall be subject to final and binding arbitration in Santa Clara, California before the American Arbitration Association under its Commercial Arbitration Rules In any such arbitration, the prevailing party shall be entitled to injunctive relief in any court of competent jurisdiction to enforce the arbitrator’s award and shall be awarded its reasonable attorney’s fees and costs.

11. Entire Agreement. This Agreement represents the entire agreement and understanding between the Parties, supersedes and replaces any and all prior agreements and understandings between them, and shall not be modified in any way except in writing executed by all Parties. The Parties further agree that, if any term or portion contained herein shall be found to be unenforceable under applicable law, such finding shall not invalidate the whole Agreement, but the Agreement shall be construed as not containing the particular term or portion held to be invalid and the rights and obligations of the Parties shall be construed and enforced accordingly. This Agreement shall be governed by California law.

12. Counterparts. This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement.

13. Acknowledgement. The Parties acknowledge that (i) they have read and understand the Agreement and they are fully aware of its legal effect; (ii) they have had an opportunity to consult with counsel in regard to this Agreement; and (iii) they are entering into this Agreement freely and voluntarily, and based on each Party’s own judgment and not on any representations or promises made by any other Party, other than those contained in this Agreement.

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The parties have duly executed this Agreement as of the date(s) indicated below.

EXECUTIVE:
/s/ Steven Nasiri	Date: October 23, 2012
Steven Nasiri

COMPANY:

InvenSense, Inc.

By:	/s/ Amit Shah	Date: October 23, 2012
Name: Amit Shah
Title: Director

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SCHEDULE 1

OPTIONS

Option Number	Type		Exercisable Shares			Exercise Price/Share
Currently exercisable
180		NQSO		964,714		$	0.70
181		ISO		400,000		$	0.70
612		NQSO		75,000		$	7.32
Accelerated
612		NQSO		150,000		$	7.32
Vesting from Effective Date through Service Termination Date
612		NQSO		37,500	(1)	$	7.32

(1) 12,500 shares on each of November 1, December 1, and December 31, 2012.

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