**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 haveemployment agreements with MOCON. MOCON has, however, entered into a writtenExecutive Severance Agreement with three of its full-time executive officers, aform of which has been filed as an exhibit to MOCON’s annual report on Form10-K for the year ended December 31, 2000. The following is a description oforal compensation arrangements between MOCON, Inc. and the following executiveofficers 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)                                  MOCONprovides its executive officers and other employees a direct financialincentive to achieve MOCON’s annual profit goals through the MOCON, Inc.Incentive Pay Plan, which was established pursuant to resolutions of theCompensation Committee effective January 1, 2003 and filed as an exhibit toMOCON’s annual report on Form 10-K for the year ended December 31, 2002. Underthe Incentive Pay Plan, annual goals are measured by MOCON’s annual net incomebefore income taxes and incentives for Mr. Demorest, Mr. Lee, Mr. Mayerand Mr. Meyer, who have overall corporate responsibilities, and by MOCON’ssemi-annual operating profit before incentives, and by semi-annual bookings, bybusiness units for Mr. Lindemann, who is in charge of several of MOCON’sbusiness units. The Incentive Pay Plan contemplates that each year theCompensation Committee will establish goal amounts for MOCON’s executiveofficers and will determine the percentage of salary at goal for MOCON’sexecutive officers. On December 28, 2005, the Compensation Committeeestablished these goal amounts and determined these percentages. Although thegoal amounts are confidential, the 2006 percentages of salary at goal rangefrom thirty-five percent to sixty-five percent of 2006 base salary earned, atgoal, 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 percentagesof salary were set forth in resolutions approved by the Compensation Committeeand are not otherwise set forth in any written agreements between MOCON and theexecutive officers. The following are the amounts paid to each of MOCON’sexecutive officers under the Incentive Pay Plan with respect to fiscal2005:  Mr. Demorest: $146,339; Mr. Mayer:$68,756; Mr. Lee: $9,822; Mr. Lindemann: $39,199 and Mr. Meyer: $10,642. Theseamounts were paid in July 2005 and March 2006.

 

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

 

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