Exhibit 10.16

MOCON, INC.

 

DESCRIPTION OF EXECUTIVE OFFICER

COMPENSATION ARRANGEMENTS

 

All of the employees of MOCON, Inc., including executive officers, are employed
“at will” and do not have employment agreements with MOCON. MOCON has, however,
entered into a written Executive Severance Agreement with three of its full-time
executive officers, a form of which has been filed as an exhibit to MOCON’s
annual report on Form 10-K for the year ended December 31, 2000. The following
is a description of oral compensation arrangements between MOCON, Inc. and the
following executive officers of MOCON:

 

Name of
Executive
Officer

 

Title

 

Base
Salary

 

Bonus
Arrangements

 

Stock
Options

 

Other

Robert L. Demorest

 

Chairman, President and Chief Executive Officer

 

$238,471
per year

 

See footnotes
(1) and (2) below

 

Stock options to purchase shares of MOCON common stock are granted from time to
time in the sole discretion of the Compensation Committee of the MOCON board of
directors

 

Under the MOCON, Inc. Savings and Retirement Plan, participants, including
executive officers, may voluntarily request that MOCON reduce pre-tax
compensation by up to 75% (subject to certain special limitations) and
contribute such amounts to a trust. MOCON contributed an amount equal to 25% of
the first 6% of the amount that each participant contributed under this plan.
MOCON provides an automobile for each of its full-time executive officers.
Executive Officers generally receive 3-5 weeks vacation per year. MOCON
employees, including its executive officers, are compensated for forfeited
vacation. Executive officers are reimbursed for expenses incurred in the
ordinary course of business. Executive officers receive other benefits received
by other MOCON employees, including health, dental and life insurance benefits.

Daniel W. Mayer

 

Executive Vice President

 

$180,082
per year

 

See footnotes
(1) and (2) below

 

See above

 

See above

Darrell B. Lee

 

Vice President, Chief Financial Officer, Treasurer and Secretary

 

$133,000
per year

 

See footnotes
(1) and (2) below

 

See above

 

See above

 

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Name of
Executive
Officer

 

Title

 

Base
Salary

 

Bonus
Arrangements

 

Stock
Options

 

Other

Douglas J. Lindemann

 

Vice President and General Manager

 

$153,529
per year

 

See footnotes
(1) and (2) below

 

See above

 

See above

Ronald A. Meyer

 

Vice President

 

$80.10
per hour

 

See footnote
(1) below

 

See above

 

See above

 

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(1)                                  MOCON provides its executive officers and
other employees a direct financial incentive to achieve MOCON’s annual profit
goals through the MOCON, Inc. Incentive Pay Plan, which was established pursuant
to resolutions of the Compensation Committee effective January 1, 2003 and filed
as an exhibit to MOCON’s annual report on Form 10-K for the year ended December
31, 2002. Under the Incentive Pay Plan, annual goals are measured by MOCON’s
annual net income before income taxes and incentives for Mr. Demorest, Mr. Lee,
Mr. Mayer and Mr. Meyer, who have overall corporate responsibilities, and by
MOCON’s semi-annual operating profit before incentives, and by semi-annual
bookings, by business units for Mr. Lindemann, who is in charge of several of
MOCON’s business units. The Incentive Pay Plan contemplates that each year the
Compensation Committee will establish goal amounts for MOCON’s executive
officers and will determine the percentage of salary at goal for MOCON’s
executive officers. On December 28, 2005, the Compensation Committee established
these goal amounts and determined these percentages. Although the goal amounts
are confidential, the 2006 percentages of salary at goal range from thirty-five
percent to sixty-five percent of 2006 base salary earned, at goal, with the
actual incentive paid based on the percentage of goal achieved, up to a maximum
of one hundred fifty percent. The fiscal 2006 goals and percentages of salary
were set forth in resolutions approved by the Compensation Committee and are not
otherwise set forth in any written agreements between MOCON and the executive
officers. The following are the amounts paid to each of MOCON’s executive
officers under the Incentive Pay Plan with respect to fiscal 2005:  Mr.
Demorest: $146,339; Mr. Mayer: $68,756; Mr. Lee: $9,822; Mr. Lindemann: $39,199
and Mr. Meyer: $10,642. These amounts were paid in July 2005 and March 2006.

 

(2)                                  On December 28, 2005, the Compensation
Committee established individual special performance related bonus arrangements
for Messrs. Demorest, Mayer, Lee and Lindemann to further motivate these
individuals to attain certain company-related performance goals in addition to
the profitability performance-related goals covered under MOCON’s Incentive Pay
Plan. While the specific performance goals remain confidential, the bonuses if
paid will be in the form of an extra week of paid vacation and an all-expense
paid trip for two, up to maximum amounts ranging from $10,000 to $13,000. The
terms of the fiscal 2006 special performance related bonuses were set forth in
resolutions approved by the Compensation Committee and are not otherwise set
forth in any written agreements between MOCON and the executive officers.

 

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