EXHIBIT 10.1
I-FLOW CORPORATION
Summary of the
2007 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) operating revenues from continuing operations, and
(ii) operating expenses from continuing operations excluding stock-based
compensation as a percentage of revenues.
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. At an overall goal
achievement percentage of 100%, the cash bonus award for the three officers
combined is an aggregate of $1,000,000, and the equity bonus award for the three
officers combined is an aggregate of 140,000 shares of restricted stock. The
maximum cash bonus award for the three officers combined is an aggregate of
$1,750,000, and the maximum equity bonus award for the three officers combined
is an aggregate of 200,000 shares of restricted stock. At the minimum overall
goal achievement percentage of 85%, the cash bonus award for the three officers
combined is an aggregate of $100,000, and the equity bonus award for the three
officers combined is an aggregate of 35,000 shares of restricted stock. For
amounts earned above or below the 100% performance level, the exact amount will
be determined on a non-linear graduated scale. 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.

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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.

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