EXHIBIT 10.9
I-FLOW CORPORATION
Summary of the
2006 Corporate Officer Incentive Plan
     Eligibility. The President and Chief Executive Officer, Executive Vice
President and Chief Operating Officer, and Chief Financial Officer are eligible
to receive cash and equity bonuses under the plan. All equity awards will be
made pursuant to the I-Flow Corporation 2001 Equity Incentive Plan.
     Objectives. The compensation committee determined that it will evaluate the
following criteria to determine whether and to what extent the plan objectives
have been achieved: (i) total revenue and (ii) profitability.
     Administrative. The overall goal achievement percentage is the sum of
(i) the accomplishment percentage of each performance target times (ii) the
weighting for each objective. Thus, if one or more targets is exceeded, it is
possible the overall goal achievement percentage could be greater than 100%. All
financial targets are considered to be plus or minus 1% of the absolute number.
In order to provide flexibility to management to operate and grow the company,
awards may be adjusted for any major events during the year; provided that, any
adjustment must be approved by the compensation committee and the board of
directors. The allocation of the aggregate awards among the officers will be
determined by the compensation committee and the board of directors based on
their assessment of the contributions of each officer.
     Award Minimums/Maximums. In order to receive an award under the plan, a
minimum aggregate performance level of 85% must be achieved. All cash and equity
bonuses are capped at a maximum of 120% of the amounts that would be earned for
an aggregate performance level of 100%. At an overall goal achievement
percentage of 100%, the cash bonus award for the three officers combined is an
aggregate of $1,575,000, and the equity bonus award for the three officers
combined is an aggregate of 100,000 shares of restricted stock. For amounts
earned above or below the 100% performance level, the exact amount will be
determined on a straight-line basis. All equity awards will be in the form of
restricted stock granted pursuant to the I-Flow Corporation 2001 Equity
Incentive Plan.
     Vesting of Equity Awards. Equity awards will consist of grants of
restricted stock. The restrictions will lapse and the shares will vest 50% on
the first anniversary of the grant date and 50% on the second anniversary of the
grant date.
     Payment of Awards. After completion of the fiscal year, the compensation
committee will review the plan objectives and results and the recommendations of
executive management. The board of directors will assess the performance of the
Chief Executive Officer, the Chief Operating Officer and the Chief Financial
Officer and will, upon recommendation from the compensation committee, approve
the cash bonus awards and equity grants. Earned cash bonus awards are typically
paid each year in February. To be eligible for awards under the plan, all
employees must be on the Company’s payroll through the date of payment of the
cash bonus.