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                                                                   Exhibit 10.27

                              CARDINAL HEALTH, INC.
                       GLOBAL EMPLOYEE STOCK PURCHASE PLAN

                               SECTION 1 - PURPOSE

          The Cardinal Health, Inc. Employee Stock Purchase Plan is adopted and
established by Cardinal Health, Inc., an Ohio corporation, on the date set forth
below, effective as of July 1, 2000, for the general benefit of the Employees of
the Company and of certain of its Subsidiaries. The purpose of the Plan is to
facilitate the purchase of Shares by Eligible Employees.

                             SECTION 2 - DEFINITIONS

a.   "ACT" shall mean the Securities Act of 1933, as amended.

b.   "ADMINISTRATOR" shall mean the Board of Directors of the Company, a
     designated committee thereof, or the person(s) or entity delegated the
     responsibility of administering the Plan, which initially shall be the
     Cardinal Health, Inc. Profit Sharing and Retirement Savings Plan Committee.

c.   "AGENT" shall mean the bank, brokerage firm, financial institution, or
     other entity or person(s) engaged, retained or appointed to act as the
     agent of the Employer and of the Participants under the Plan, which
     initially shall be Merrill Lynch, Pierce, Fenner, & Smith, Inc.

d.   "BOARD" shall mean the Board of Directors of the Company.

e.   "CLOSING VALUE" shall mean, as of a particular date, the value of a Share
     determined by the closing sales price for such Share (or the closing bid,
     if no sales were reported) as quoted on The New York Stock Exchange for the
     last market trading day prior to the date of determination, as reported in
     The Wall Street Journal or such other source as the Administrator deems
     reliable.

f.   "CODE" shall mean the Internal Revenue Code of 1986, as amended and
     currently in effect, or any successor body of federal tax law.

g.   "COMPANY" shall mean Cardinal Health, Inc., including any successor
     thereto.

h.   "COMPENSATION", unless otherwise required by local law, shall mean wages,
     salaries, fees for professional services and other amounts received for
     personal services actually rendered in the course of employment with the
     Employer (including, but not limited to, commissions paid to salesmen,
     compensation for services on the basis of a percentage of profits,
     commissions on insurance premiums, tips and bonuses) including amounts
     excludible from the Employee's gross income under Code Section 402(a)(8)
     (relating to a Code Section 401(k) arrangement), Code Section 402(h)
     (relating to a Simplified Employee Pension), Code Section 125 (relating to
     a cafeteria plan) or Code Section 403(b) (relating to a tax-sheltered
     annuity) and compensation paid by the Employer to an Employee through
     another person under the common paymaster provisions of Code Sections
     3121(s) and 3306(p) or under applicable savings or pension plans of
     Employer of the Employee. Compensation does not include, unless otherwise
     required by local law: (1) amounts realized from the exercise or sale of a
     non-qualified stock option, or (2) amounts realized when restricted stock
     (or property) held by an Employee either becomes freely transferable or is
     no longer subject to a substantial risk of forfeiture or becomes fully
     owned by the Employee, or (3) amounts realized from the exercise, sale,
     exchange, or other disposition of stock acquired under a qualified or
     incentive stock option, (4) moving allowances, automobile allowances,
     tuition reimbursement, financial/tax planning reimbursement, lunch
     vouchers, house allowances, and other allowances that receive special tax
     benefits,

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     other extraordinary compensation, including tax "gross-up" payments, and
     imputed income from other employer-provided benefits, and (5) other amounts
     that receive special tax benefits, such as premiums for group term life
     insurance or contributions made by the Employer (whether or not under
     salary reduction agreement) or mandatory payments made by the Employer to
     the Employee under the applicable law of the jurisdiction in which the
     Employer of this Employee is located or the Employee is employed or
     resides.

i.   "DESIGNATED SUBSIDIARIES" shall mean all Subsidiaries whose Employees have
     been designated by the Administrator, in its sole discretion, as eligible
     to participate in the Plan.

j.   "ELIGIBLE EMPLOYEE" shall mean an Employee of the Designated Subsidiary who
     is designated to participate in the Plan at the sole discretion of the
     Designated Subsidiary; provided, however, that such discretion shall not be
     exercised in violation of the applicable labor or other laws relating to
     discrimination based on gender, race, disability, age, national or social
     origin, political opinion, union membership or religious belief, or
     collective bargaining or other negotiated agreements.

k.   "EMPLOYEE" shall mean individual who is a regular full time or part time
     Employee of the Employer for at least 30 days. An Employee may work either
     full time or part time work schedule and is normally included in the
     authorized staffing target and budget. Employee also includes the Employee
     who has been hired on a temporary contract but who is expected to fill a
     permanent staffing need and who is classified as a "PRN" or "on-call
     Employee". The Employee shall not include unionized Employee as defined by
     the regular practices of the Employer participating in the Plan to the
     extent permissible under local law.

l.   "EMPLOYER" means, individually and collectively, the Company and the
     Designated Subsidiaries.

m.   "ENROLLMENT PERIOD" shall mean the period immediately preceding the
     Offering Period that is designated by the Administrator in its discretion
     as the period during which an Eligible Employee may elect to participate in
     the Plan.

n.   "OFFERING PERIOD" shall mean the period during which Participants in the
     Plan authorize payroll deductions or provide alternative contributions to
     fund the purchase of Shares on their behalf under the Plan pursuant to the
     options granted to them hereunder or the period during which participants
     in the Plan provide alternative contributions. Alternative contributions
     for the purpose of this Plan shall mean payment of contributions through
     personal checks of the Participants or such other means of contributing to
     the Plan as authorized by the Administrator.

o.   "PARTICIPANT" shall mean any Eligible Employee who has elected to
     participate in the Plan for an Offering Period by authorizing payroll
     deductions or by making alternative contributions and following all
     applicable procedures established by the Administrator during the
     Enrollment Period for such Offering Period.

p.   "PLAN" shall mean this Cardinal Health, Inc. Global Employee Stock Purchase
     Plan as amended from time to time.

q.   "PLAN ACCOUNT" shall mean the individual account established for each
     Participant for purposes of accounting for and/or holding each
     Participant's payroll deductions, alternative contributions, Shares, etc.

r.   "PLAN YEAR" shall mean the fiscal year of the Company.

s.   "PURCHASE PRICE" shall mean, for each Share purchased in accordance with
     Section 4 hereof, an amount equal to the lesser of (1) eighty-five percent
     (85%) of the Closing Value of a Share on the first Trading Day of each
     Offering Period (which for Plan purposes shall be deemed to be the date the
     option to purchase such Shares was granted to each Eligible Employee who
     is, or elects to become, a Participant); or (2) eighty-five percent (85%)
     of the Closing Value of such Share on the last Trading Day of the Offering
     Period (which for Plan purposes shall be deemed to be the date each such
     option to purchase such Shares was exercised).

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t.   "SHARES" means the Class A common shares, without par value, of the
     Company.

u.   "SUBSIDIARY" shall mean a corporation or other entity, domestic or foreign,
     of which not less than fifty percent (50%) of the voting shares are held by
     the Company or a Subsidiary (except for the U.K. in which this term shall
     mean a corporation or other entity, domestic or foreign, of which more than
     fifty percent (50%) ownership of the voting shares are held by the Company
     or a Subsidiary) whether or not such corporation or other entity now exists
     or is hereafter organized or acquired by the Company or a Subsidiary (or as
     otherwise may be defined in Code Section 424).

v.   "TRADING DAY" shall mean a day on which The New York Stock Exchange is open
     for trading.

                         SECTION 3 - ELIGIBLE EMPLOYEES

          a. In General. Participation in the Plan is voluntary. All Eligible
Employees of an Employer are eligible to participate in the Plan. All Eligible
Employees granted options to purchase Shares hereunder shall have the same
rights and privileges as every other such Eligible Employee, and only Eligible
Employees of an Employer satisfying the applicable requirements of the Plan will
be entitled to be granted options hereunder.

          b. Limitations on Rights. An Employee who otherwise is an Eligible
Employee shall not be entitled to purchase Shares under the Plan if such
purchase would cause such Eligible Employee to own Shares (including any Shares
which would be owned if such Eligible Employee purchased all of the Shares made
available for purchase by such Eligible Employee under all options or rights
then held by such Eligible Employee, whether or not then exercisable)
representing five percent (5%) or more of the total combined voting power or
value of all classes of stock of the Company or any Subsidiary.

                   SECTION 4 - ENROLLMENT AND OFFERING PERIODS

          a. Enrolling in the Plan. To participate in the Plan, an Eligible
Employee must enroll in the Plan. Enrollment for a given Offering Period will
take place during the Enrollment Period for such Offering Period. The
Administrator shall designate the initial Enrollment Period and each subsequent
Enrollment Period and the Offering Period to which each Enrollment Period
relates. Participation in the Plan with respect to any one or more of the
Offering Periods shall neither limit nor require participation in the Plan for
any other Offering Period.

          b. The Offering Period. Any Employee who is an Eligible Employee and
who desires to be granted options to purchase Shares hereunder must enroll in
accordance with the procedures established by the Administrator during an
Enrollment Period. Such authorization shall be effective for the Offering Period
immediately following such Enrollment Period. The duration of an Offering Period
shall be determined by the Administrator prior to the Enrollment Period and
shall commence on the first day (or the first Trading Day) of the Offering
Period and end on the last day (or the last Trading Day) of the Offering Period;
provided, however, that if the Administrator terminates the Plan during an
Offering Period, pursuant to its authority in Section 17 of the Plan, such
Offering Period shall be deemed to end on the date the Plan is terminated. The
termination of the Plan and the Offering Period shall end the Participant's
rights to contribute amounts to the Plan or continue participation in the
Offering Period. The date of termination of the Plan shall be deemed to be the
final day of the Offering Period for purposes of determining the Purchase Price
under the Offering Period and all amounts contributed during the Offering Period
will be used as of such termination date to purchase Shares in accordance with
the provisions of Section 9 of this Plan.

          The Administrator may designate one or more Offering Periods during
each Plan Year during the term of this Plan. On the first day (or the First
Trading Day) of each Offering Period, each Participant shall be granted an
option to purchase Shares under the Plan. Each option granted hereunder shall
expire at the end of the Offering Period for which it was granted. In no event
may an option granted hereunder be exercised after the expiration of 27 months
from the date of grant.

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          c. Changing Enrollment. The offering of Shares pursuant to options
granted under the Plan shall occur only during an Offering Period and shall be
made only to Participants. Once an Eligible Employee is enrolled in the Plan,
the Administrator or Employer will inform the Agent of such fact. Once enrolled,
a Participant shall continue to participate in the Plan for each successive
Offering Period (s) until he or she terminates his or her participation by
revoking his or her payroll deduction authorization or by revoking his or her
alternative contribution authorization or not contributing his or her
alternative contributions or ceases to be an Eligible Employee. Once a
Participant has elected to participate under the Plan, that Participant's
payroll deduction authorization or alternative contribution authorization shall
apply to all subsequent Offering Periods unless and until the Participant ceases
to be an Eligible Employee, or modifies or terminates said authorization. If a
Participant desires to change his or her rate of contribution, he or she may do
so effective for the next Offering Period by following the procedures
established by the Administrator during the Enrollment Period immediately
preceding such Offering Period.

                            SECTION 5 - TERM OF PLAN

          This Plan shall be in effect from July 1, 2000, until it is terminated
by action of the Board.

                SECTION 6 - NUMBER OF SHARES TO BE MADE AVAILABLE

          Subject to adjustment as provided in Section 16 hereof, the total
number of Shares made available for purchase by Participants granted options
which are exercised under Section 9 hereof is 3 million, which may consist of
authorized but unissued shares, treasury shares, or shares purchased by the Plan
in the open market. The provisions of Section 9 b. shall control in the event
the number of Shares covered by options which are exercised for any Offering
Period exceeds the number of Shares available for sale under the Plan. If all of
the Shares authorized for sale under the Plan have been sold, the Plan shall
either be continued through additional authorizations of Shares made by the
Board (such authorizations must, however, comply with Section 17 hereof), or
shall be terminated in accordance with Section 17 hereof.

                            SECTION 7 - USE OF FUNDS

          All payroll deductions or alternative contributions received or held
by an Employer under the Plan will be used to purchase Shares in accordance with
the provisions of this Plan. Any amounts held by an Employer or other party
holding amounts in connection with or as a result of payroll withholding or
alternative contribution made pursuant to the Plan and pending the purchase of
Shares hereunder shall be considered a non-interest-bearing, unsecured
indebtedness extended to the Employer or other party by the Participants, unless
otherwise required under applicable local law or securities regulatory body
requirements of the country in which the Employer of the Employee is located or
the Employee is employed or resides, as the case may be. Administrative expenses
of the Plan shall be allocated to each Participant's Plan Account unless such
expenses are paid by the Employer.

              SECTION 8 - AMOUNT OF CONTRIBUTION; METHOD OF PAYMENT

          a. Payroll Withholding or Payroll Deduction or Alternative
Contributions. Except as otherwise specifically provided herein, the Purchase
Price will be payable by each Participant by means of payroll withholding. The
withholding or alternative contributions shall be in increments of one percent
(1%). Unless otherwise authorized by the Administrator, the minimum withholding
or alternative contributions permitted shall be an amount equal to one percent
(1%) of a Participant's Compensation and the maximum withholding or alternative
contributions shall be an amount equal to fifteen percent (15%) of a
Participant's Compensation. In any event, the total withholding or alternative
contributions permitted to be made by any Participant for a calendar year shall
be limited to the sum of legal currency equivalent of U.S. $21,250. The actual
percentage of Compensation to be deducted or contributed shall be specified by a
Participant in his or her authorization to participate in the Plan. Unless
otherwise authorized by the Administrator, Participants may not deposit any
separate cash payments into their Plan Accounts.

          b. Application of Withholding Rules. Payroll withholding will commence
with the first payroll issued during the Offering Period and will, except as
otherwise provided herein, continue with each payroll

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throughout the entire Offering Period, except for pay periods for which such
Participant receives no compensation (e.g., uncompensated personal leave, leave
of absence). A pay period which ends at such time that it is administratively
impracticable to credit any payroll for such pay period to the then-current
Offering Period will be credited in its entirety to the immediately subsequent
Offering Period. A pay period which overlaps Offering Periods will be credited
in its entirety to the Offering Period in which it is paid. Alternative
contributions will be made in accordance with the procedure established by the
Administrator. Payroll withholding or alternative contributions shall be
retained by the Employer or other party, designated by the Administrator or the
Employer as the case may be, until applied to the purchase of Shares as
described in Section 9 hereof and the satisfaction of any related federal,
state, local or other tax withholding obligations (including any employment tax
obligations).

          At the time the Shares are purchased, or at the time some or all of
the Shares issued under the Plan are disposed of, Participants must make
adequate provision for the Employer's federal, state, local or other tax
withholding obligations (including employment taxes), if any, which arise upon
the purchase or disposition of the Shares. At any time, the Employer may
withhold from each Participant's Compensation the amount necessary for the
Employer to meet applicable withholding obligations, including any withholding
required to make available to the Employer any tax deductions or benefits
attributable to the sale or early disposition of Shares by the Participant. Each
Participant, as a condition of participating under the Plan, agrees to bear
responsibility for all federal, state, local and other income taxes required to
be withheld from his or her Compensation as well as the Participant's portion of
FICA (both the OASDI and Medicare components), and other applicable social
security or similar such taxes, with respect to any Compensation arising on
account of the purchase or disposition of Shares. The Employer may increase
income and/or employment tax withholding on a Participant's Compensation after
the purchase or disposition of Shares in order to comply with federal, state,
local and other tax laws, and each Participant agrees to sign any and all
appropriate documents to facilitate such withholding.

                   SECTION 9 - PURCHASING, TRANSFERRING SHARES

          a. Maintenance of Plan Account. Upon the exercise of a Participant's
initial option to purchase Shares under the Plan, the Agent shall establish a
Plan Account in the name of such Participant. At the close of each Offering
Period, the aggregate amount deducted during such Offering Period by the
Employer from a Participant's Compensation, or alternative contributions made to
the Plan by the Participant (and credited to an account maintained by the
Employer or other party for bookkeeping purposes) will be communicated by the
Employer to the Agent and shall thereupon be credited by the Agent to such
Participant's Plan Account (unless the Participant has given notice to the
Administrator of his or her revocation of authorization prior to the date such
communication is made). As of the last day of each Offering Period, or as soon
thereafter as is administratively practicable, each Participant's option to
purchase Shares will be exercised automatically for him or her by the Agent with
respect to those amounts reported to the Agent by the Administrator or Employer
as creditable to that Participant's Plan Account. On the date of exercise, the
amount then credited to the Participant's Plan Account for the purpose of
purchasing Shares hereunder will be divided by the Purchase Price and there
shall be transferred to the Participant's Plan Account by the Agent the number
of whole and/or fractional shares which results, as permitted by local law.

          The Agent shall hold in its name, or in the name of its nominee, all
Shares so purchased and allocated. No certificate will be issued to a
Participant for Shares held in his or her Plan Account unless he or she so
requests in writing or unless such Participant's active participation in the
Plan is terminated due to death, disability, separation from service or
retirement. Participation in the Plan, purchase, ownership and sale of Shares
under the Plan, is subject to risk of fluctuation in Shares' price and currency
exchange.

          b. Insufficient Number of Available Shares. In the event the number of
Shares covered by options which are exercised for any Offering Period exceeds
the number of Shares available for sale under the Plan, the number of Shares
actually available for sale hereunder shall be limited to the remaining number
of Shares authorized for sale under the Plan and shall be allocated by the Agent
among the Participants in proportion to each Participant's Compensation during
the Offering Period over the total Compensation of all Participants during the
Offering Period. Any excess amounts withheld and credited to Participants' Plan
Accounts then shall be returned to the Participants as soon as is
administratively practicable.

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          c. Handling Excess Shares. In the event that the number of Shares
which would be credited to any Participant's Plan Account in any Offering Period
exceeds the limit specified in Section 3 b. hereof, such Participant's Plan
Account shall be credited with the maximum number of Shares permissible, and the
remaining amounts will be refunded in cash as soon as administratively
practicable.

          d. Status Reports. Statements of each Participant's Plan Account shall
be given to Participants at least annually.

                 SECTION 10 - DIVIDENDS AND OTHER DISTRIBUTIONS

          a. Reinvestment of Dividends. Subject to applicable law, cash
dividends and other cash distributions received by the Agent on Shares held in
its custody hereunder will be credited to the Plan Accounts of individual
Participants in accordance with such Participants' interests in the Shares with
respect to which such dividends or distributions are paid or made, and will be
applied, as soon as practical after the receipt thereof by the Agent, to the
purchase in the open market at prevailing market prices of the number of whole
Shares capable of being purchased with such funds (after deduction of any bank
service fees, brokerage charges, transfer taxes, and any other transaction fee,
expense or cost payable in connection with the purchase of such Shares and not
otherwise paid by the Employer and subject to the Company's obligation to
withhold federal, state, or other local taxes).

          b. Shares to Be Held in Agent's Name. All purchases of Shares made
pursuant to this Section will be made in the name of the Agent or its nominee,
shall be held as provided in Section 9 hereof, and shall be transferred and
credited to the Plan Account(s) of the individual Participant(s) to which such
dividends or other distributions were credited. Dividends paid in the form of
Shares will be allocated by the Agent, as and when received, with respect to
Shares held in its custody hereunder to the Plan Accounts of individual
Participants in accordance with such Participants' interests in such Shares with
respect to which such dividends were paid. Property, other than Shares or cash,
received by the Agent as a distribution on Shares held in its custody hereunder,
shall be sold by the Agent for the accounts of the Participants, and the Agent
shall treat the proceeds of such sale in the same manner as cash dividends
received by the Agent on Shares held in its custody hereunder.

          c. Tax Responsibilities. The automatic reinvestment of dividends under
the Plan will not relieve a Participant (or Eligible Employee with a Plan
Account) of any income or other tax that may be due on or with respect to such
dividends. The Agent shall report to each Participant (or Eligible Employee with
a Plan Account) the amount of dividends credited to his or her Plan Account.

                          SECTION 11 - VOTING OF SHARES

          A Participant shall have no interest or voting right in the Shares
covered by his or her option until such option has been exercised. Shares held
for a Participant (or Eligible Employee with a Plan Account) in his or her Plan
Account will be voted in accordance with the Participant's (or Eligible
Employee's) express directions. In the absence of any such directions, such
Shares will not be voted.

             SECTION 12 - IN-SERVICE DISTRIBUTION OR SALE OF SHARES

          a. Sale of Shares. Subject to the provisions of Section 19 hereof, a
Participant may at any time, and without withdrawing from the Plan, by giving
notice to the Agent, direct the Agent to sell all or part of the Shares held on
behalf of the Participant. Upon receipt of such a notice, the Agent shall, as
soon as practicable after receipt of such notice, sell such Shares in the
marketplace at the prevailing market price and transmit the net proceeds of such
sale (less any bank service fees, brokerage charges, transfer taxes, and any
other transaction fee, expense or cost) to the Participant.

          b. In-Service Share Distributions. A Participant may, without
withdrawing from the Plan, request that a certificate for all or part of the
whole number of Shares held in his or her Plan Account be sent to him or her
after the relevant Shares have been purchased and allocated subject to the
requirement that such Shares be held in the Participant's Plan Account for a
period of at least 24 months after the date of exercise, as described in

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Section 9 a., above. All such requests must be submitted in writing to the
Agent. No certificate for a fractional Share will be issued; the fair value of
fractional Shares on the date of withdrawal of all Shares credited to a
Participant's Plan Account shall be paid in cash to such Participant. The Plan
may impose a reasonable charge, to be paid by the Participant, for each stock
certificate so issued prior to the date active participation in the Plan ceases;
such charge shall be paid by the Participant to the Administrator or Employer
prior to the date any distribution of a certificate evidencing ownership of such
Shares occurs.

                 SECTION 13 - CESSATION OF ACTIVE PARTICIPATION

          A Participant may at any time, by giving notice to the Administrator
or Employer, revoke his or her authorization for payroll deduction or
alternative contributions for the Offering Period in which such revocation is
made. A Participant who revokes authorization or does not make alternative
contributions for payroll deduction may not again participate under the Plan
until the next Offering Period immediately subsequent to the Offering Period
during which the Participant revoked payroll deduction authorization or did not
make alternative contributions with respect thereto.

                     SECTION 14 - SEPARATION FROM EMPLOYMENT

          Separation from employment for any reason, including death,
disability, termination or retirement shall be deemed to be a cessation of
active participation in the Plan as described under Section 13 hereof.

                             SECTION 15 - ASSIGNMENT

          Neither payroll deductions nor alternative contributions credited to a
Participant's Plan Account nor any rights to purchase Shares under the Plan may
be assigned, alienated, transferred, pledged, or otherwise disposed of in any
way by a Participant other than by will or the laws of descent and distribution.
Any such assignment, alienation, transfer, pledge, or other disposition shall be
without effect, except that the Administrator may treat such act as an election
to withdraw from the Plan. A Participant's right to purchase Shares under this
Plan may be exercisable during the Participant's lifetime only by the
Participant. A Participant's Plan Account shall be payable to the Participant's
estate upon his or her death.

                SECTION 16 - ADJUSTMENT OF AND CHANGES IN SHARES

          If at any time after the effective date of the Plan the Company shall
subdivide or reclassify the Shares which have been or may be optioned under the
Plan, or shall declare thereon any stock split or dividend payable in Shares, or
shall alter the capital structure of the Shares or the Company in any similar
manner, then the number and class of shares held in the Plan and which may
thereafter be optioned (in the aggregate and to any Participant) shall be
adjusted accordingly, and in the case of each option outstanding at the time of
any such action, the number and class of shares which may thereafter be
purchased pursuant to such option and the Purchase Price shall be adjusted
accordingly, as necessary to preserve the rights of the holder(s) of such Shares
and option(s).

                SECTION 17 - AMENDMENT OR TERMINATION OF THE PLAN

          The Board shall have the right, at any time, to amend, modify or
terminate the Plan without notice; provided, however, that no Participant's
existing options shall be adversely affected by any such amendment, modification
or termination, except to comply with applicable law, stock exchange rules or
accounting rules. Notwithstanding the foregoing, the Board shall have the right
to terminate the Plan with respect to all future payroll deductions and related
purchases at any time. Such termination of the Plan shall also terminate any
current Offering Period in accordance with Section 4 of the Plan.

          Designations of participating corporations may be made from time to
time from among a group of corporations consisting of the Employer, its parent
and its Subsidiaries (including corporations that become Subsidiaries or a
parent after the adoption and approval of the Plan).

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          The Company may amend or modify the Plan or make regulations for the
operation of the Plan that are not inconsistent with these rules to apply to
Employees and Participants who are employed or resident outside of the United
States of America in accordance with the relevant law. "Relevant law" shall mean
the applicable law of the jurisdiction in which the Employer of the Employee is
located or where the Employee is employed or resides and the securities
regulatory body requirements and the taxation requirements of that same
jurisdiction.

                           SECTION 18 - ADMINISTRATION

          a. Administration. The Plan shall be administered by the
Administrator. The Administrator shall be responsible for the administration of
all matters under the Plan which have not been delegated to the Agent. The
Administrator shall have full and exclusive discretionary authority to construe,
interpret and apply the terms of the Plan, to determine eligibility and to
adjudicate all disputed claims filed under the Plan. Any rule or regulation
adopted by the Administrator shall remain in full force and effect unless and
until altered, amended or repealed by the Administrator.

          b. Specific Responsibilities. The Administrator's responsibilities
shall include, but shall not be limited to:

               (1) interpreting the Plan (including issues relating to the
               definition and application of "Compensation");

               (2) identifying and compiling a list of persons who are Eligible
               Employees for an Offering Period;

               (3) identifying those Eligible Employees not entitled to be
               granted options or other rights for an Offering Period on account
               of the limitations described in Section 3 b. hereof; and

               (4) providing to Participants upon request Company financial
               statements which are publicly available.

The Administrator may from time to time adopt rules and regulations for carrying
out the terms of the Plan. Interpretation or construction of any provision of
the Plan by the Administrator shall be final and conclusive on all persons,
absent specific and contrary action taken by the Board. Any interpretation or
construction of any provision of the Plan by the Board shall be final and
conclusive.

               SECTION 19 - SECURITIES LAW AND OTHER RESTRICTIONS

          Notwithstanding any provision of the Plan to the contrary, no payroll
deductions or alternative contributions shall take place and no Shares may be
purchased under the Plan until a registration statement has been filed and
become effective with respect to the issuance of the Shares covered by the Plan
under the Act and any other required action has been taken under any other
applicable law of the jurisdiction in which the Employer of the Employee is
located or the Employee is employed or resides. Prior to the effectiveness of
such registration statement, Shares subject to purchase under the Plan may be
offered to Eligible Employees only pursuant to an exemption from the
registration requirements of the Act and pursuant to any other action that is
required under any other applicable law of the jurisdiction in which the
Employer of the Employee is located or the Employee is employed or resides.

                  SECTION 20 - NO INDEPENDENT EMPLOYEE'S RIGHTS

          Nothing in the Plan shall be construed to be a contract of employment
between an Employer or its parent or any Subsidiary and any Employee, or any
group or category of Employees (whether for a definite or specific duration or
otherwise), or to prevent the Employer, its parent or any Subsidiary from
terminating any Employee's employment at any time, without notice or recompense
to the extent permissible under local law.

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Nothing in this Plan shall be construed as conferring any rights of a
shareholder in any Employee or any other person until the option to purchase
shares granted to the Employee hereunder has been exercised.

                           SECTION 21 - APPLICABLE LAW

          The Plan shall be construed, administered and governed in all respects
under the laws of the State of Ohio to the extent such laws are not preempted or
controlled by federal law.

                      SECTION 22 - MERGER OR CONSOLIDATION

          If the Company shall at any time merge into or consolidate with
another corporation or business entity, each Participant will thereafter be
entitled to receive at the end of the Offering Period (during which such merger
or consolidation occurs) the securities or property which a holder of Shares was
entitled to upon and at the time of such merger or consolidation. A sale of all
or substantially all of the assets of the Company shall be deemed a merger or
consolidation for the foregoing purposes.

                                                                          Page 9

<PAGE>

                                 FIRST AMENDMENT
                                     TO THE
            CARDINAL HEALTH, INC. GLOBAL EMPLOYEE STOCK PURCHASE PLAN

                             Background Information

     A. Cardinal Health, Inc., an Ohio corporation (the "Company"), maintains an
employee stock purchase plan known as the Cardinal Health, Inc. Global Employee
Stock Purchase Plan (the "Plan") for the benefit of eligible employees of its
designated subsidiaries.

     B. Pursuant to Section 17 of the Plan, the Company may amend the Plan by
action of its Board of Directors, which authority has been delegated by the
Board of Directors to the Financial Benefit Plans Committee of the Company.

     C. The Cardinal Health Financial Benefit Plans Committee (the "Committee")
is empowered to amend the Plan on behalf of the Company by action of a majority
of its members then in office and has authorized the amendments set forth herein
and the execution of these amendments by the undersigned.

                              Amendment to the Plan

     Effective as of February 25, 2005, the Cardinal Health, Inc. Global
Employee Stock Purchase Plan is amended in the following respects:

     1. Section 10.a is hereby revised to read as follows: "Reinvestment of
Dividends. Subject to applicable law, cash dividends and other cash
distributions received by the Agent on Shares held in its custody hereunder will
be credited to the Plan Accounts of individual Participants in accordance with
such Participants' interests in the Shares with respect to which such dividends
or distributions are paid or made. Cash dividends will be applied, as soon as
practicable after the receipt thereof by the Agent, in accordance with the
directions of the individual Participant to whose Plan Account such amounts have
been credited. Participants may, but are not required to, direct that such cash
dividends be applied to the purchase in the open market at prevailing market
prices of the number of whole Shares capable of being purchased with such funds
(or the portion of such funds designated for such application by the
Participant), after deduction of any bank service fees, brokerage charges,
transfer taxes, and any other transaction fee, expense or cost payable in
connection with the purchase of such Shares and not otherwise paid by the
Employer, and subject to the Company's obligation to withhold federal, state or
other local taxes."

     2. In all other respects, the Plan shall remain in full force and effect.

Date: April 7, 2005                     CARDINAL HEALTH, INC.

                                        By: /s/ Sue Nelson
                                            ------------------------------------
                                        Its: Vice President, Compensation &
                                             Benefits, Secretary, FBPC<PAGE>
                                                                   Exhibit 10.36

                               RETENTION AGREEMENT

     THIS RETENTION AGREEMENT (this "Agreement") is dated as of August 31, 2004,
by and between David L. Schlotterbeck (the "Employee") and ALARIS Medical
Systems, Inc., a Delaware corporation (the "Company").

                                    RECITALS

     WHEREAS, the Employee and the Company executed a letter agreement on May
10, 2000, (the "Change of Control Agreement") providing the Employee with
certain severance benefits in the event of a "change of control" as defined in
the Change of Control Agreement;

     WHEREAS, on July 7, 2004, the Company became a wholly-owned subsidiary of
Cardinal Health, Inc. ("Cardinal"), pursuant to that certain Agreement and Plan
of Merger by and among the Company, Blue Merger Corp. and Cardinal dated as of
May 18, 2004 (the "Merger Agreement");

     WHEREAS, the Employee is employed by the Company; and

     WHEREAS, the Company values the services of the Employee and desires to
provide an inducement to the Employee to work as an employee of the Company for
a period following the Closing (as such capitalized term is defined in the
Merger Agreement).

                                    AGREEMENT

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants,
agreements, representations and warranties herein contained, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto, intending to be legally bound hereby, do
hereby agree as follows:

     1. Retention Program. If the Employee remains employed by the Company,
Cardinal or any other direct or indirect subsidiary of Cardinal (Cardinal and
Cardinal's other subsidiaries are hereinafter referred to as "Affiliated
Companies" and each as an "Affiliated Company") until June 28, 2006 (the "Target
Date"), the Company shall pay to Employee a one-time, lump-sum retention cash
bonus equal to the greater of (a) $2,172,000.00 and (b) the sum of (i) two
hundred percent (200%) of the Employee's base annual pay effective as of the
Target Date and (ii) two hundred percent (200%) of the Employee's target bonus
for the fiscal year ending June 30, 2006 (the "Retention Bonus"). If the
Retention Bonus is earned by the Employee pursuant to this Section 1, the
Retention Bonus will be paid to the Employee within fifteen (15) days following
the Target Date. In addition, if at anytime after June 28, 2006 (the "Target
Date") the Employee voluntarily departs from the Company, the Company shall pay
to the Employee a one time lump sum cash bonus equal to one hundred percent
(100%) of the Employee's base annual pay effective as of the departure date.

     2. Change of Control Agreement. The Employee acknowledges and agrees that
by executing this Agreement, the Change of Control Agreement shall be terminated
in its entirety, and the terms and conditions thereof shall be superseded by the
terms and conditions of this Agreement; and that, effective upon the execution
of this Agreement by the Employee, neither the Company nor Cardinal, nor any
other Affiliated Company, shall have any obligation to the Employee, nor shall
the Employee enjoy any rights or privileges, under the Change of Control
Agreement.

<PAGE>

     3. Termination Prior to the Target Date.

          (a) General. Nothing contained in this Agreement shall (i) confer upon
the Employee any right to continue in the employ of the Company, (ii) constitute
any contract or agreement of employment, or (iii) interfere in any way with the
at-will nature of the Employee's employment with the Company. The parties hereto
acknowledge, understand and agree that (so long as it is done in accordance with
applicable law) the Company may terminate the Employee's employment at any time
for any reason or for no reason with or without notice and that the Employee may
terminate the Employee's employment with the Company at anytime for any reason
or for no reason with or without notice, including, without limitation, in each
case, for Disability (as hereinafter defined), but only if that Disability
continues through the Date of Termination (as hereinafter defined). The Employee
shall be entitled to the benefits provided in Section 4 upon a termination of
the Employee's employment if that termination occurs on or prior to the Target
Date, but only if that termination was effected (i) by the Company other than
for Cause (as defined below); (ii) by the Employee for Good Reason (as defined
below); (iii) by the Employee's death; or (iv) by the Company for Disability (as
defined below) (a termination of the Employee's employment under the
circumstances set forth in clause (i), (ii), (iii) or (iv) of this sentence is
hereinafter referred to as a "Payment Termination"). The Employee shall not be
entitled to the benefits provided in Section 4: (i) if the Employee's employment
is terminated for any reason after the Target Date or (ii) the Employee's
employment is terminated on or prior to the Target Date, if such termination is
occasioned: (A) by the Company for Cause or (B) by the Employee for other than
Good Reason. A termination of the Employee's employment under the circumstances
set forth in clause (A) or (B) above is hereinafter referred to as a
"Non-Payment Termination").

          (b) Death or Disability. The Employee's employment with the Company
shall terminate, automatically, upon the Employee's death. For purposes hereof
the term "Disability" shall mean the Employee's absence from the full-time
performance of the Employee's duties with the Company for six (6) consecutive
months as set forth in the Company's disability plan, a copy of which is
available to the Employee.

          (c) Cause. The Company may terminate the Employee's employment for any
reason or for no reason, including, without limitation, for Cause. For purposes
of this Agreement, "Cause" shall mean (i) any breach by the Employee of any of
the Employee's obligations under this Agreement of a type and kind which is
materially adverse to the Company and which remains uncured by the Employee for
thirty (30) calendar days following the Employee's receipt of Notice of
Termination (as hereinafter defined); (ii) any gross misconduct by the Employee
of a type and kind which is materially adverse to the Company; (iii) any
violation by the Employee of a governmental law, rule or regulation applicable
to the business of the Company of a type and kind which is materially adverse to
the Company; or (iv) the Employee's conviction of, or entry by the Employee of a
guilty, or no contest, plea to, the commission of a felony of a kind that causes
material impairment or injury or substantial embarrassment to the Company.

          (d) Good Reason. The Employee may terminate the Employee's employment
for any reason or for no reason, including, without limitation for Good Reason.
For purposes of this Agreement, "Good Reason" shall mean the occurrence after
the Closing occurring on or before the Target Date of any one or more of the
following events without, in each case, the Employee's prior written consent:

                                        2

<PAGE>

               i. the assignment to the Employee of any duties (other than
duties constituting reasonable transition services in connection with the
consummation of the transaction anticipated by the Merger Agreement) which are
inconsistent with the position in the Company that the Employee held immediately
prior to the Closing, an alteration in the nature or status of the Employee's
responsibilities or the conditions of the Employee's employment from those in
effect immediately prior to the Closing, or any other action by the Company that
results in a diminution in the position and authority with the Company held by
the Employee prior to the Closing, in each case, under circumstances in which
such assignment, alteration or action is materially adverse to the Employee;
provided, however, that, for purposes of this Section, the fact that the
Employee is no longer an employee of a "publicly-traded" company shall not be
deemed to be an alteration in the Employee's responsibilities or conditions or a
diminution in position or authority;

               ii. the Company's reduction of the Employee's annual base salary
or bonus opportunity, each as in effect on the Closing Date or as the same may
be increased from time to time;

               iii. the relocation of the Company's offices at which the
Employee is principally employed immediately prior to the Closing (the
Employee's "Principal Location") to a location more than ten (10) miles from the
Principal Location, or the Company's requiring the Employee to be based at a
location more than ten (10) miles from the Employee's Principal Location, except
for required travel on the Company's business to an extent substantially
consistent with the Employee's present business travel obligations;

               iv. the Company's failure to pay to the Employee any portion of
the Employee's current compensation or any portion of an installment of deferred
compensation under any deferred compensation program of the Company within seven
(7) days following the later of the date such compensation is due or the date of
written demand by the Employee for the payment of such compensation
(specifically referring to this Section 3(d)(iv));

               v. the Company's failure to continue in effect compensation and
benefit plans which provide the Employee with benefits which are substantially
similar, on an aggregate basis, to the benefits provided to the Employee under
the Company's regular compensation and benefit plans and practices immediately
prior to the Closing, unless an equitable arrangement (embodied in ongoing
substitute or alternative plans) has been made with respect to such plans, or
the Company's failure to continue the Employee's participation therein (or in
such substitute or alternative plans) on a basis not materially less favorable
in the aggregate, both in terms of the amount of benefits provided and the level
of the Employee's participation relative to other participants, as existed at
the time of the Closing;

               vi. any purported termination of the Employee's employment by the
Company which does not satisfy the requirements of Section 3(e) hereof (such a
purported termination shall not be effective for purposes of this Agreement);

               vii. the continuation or repetition, after written notice of
objection from the Employee (specifically referring to this Section 3(d)(vii)),
of harassing or denigrating treatment of the Employee inconsistent with the
Employee's position with the Company, which treatment is materially adverse to
the Employee; or

               viii. any breach by the Company of its obligations under this
Agreement which is materially adverse to the Employee and which remains uncured
by the

                                        3

<PAGE>

Company for five (5) calendar days following the Company's receipt of notice
thereof (specifically referring to this Section 3(d)(viii)).

In addition, in the event that the Employee has become Disabled on or before the
Target Date, the Employee may terminate the Employee's employment on or before
the Target Date and such termination shall be deemed to be for Good Reason.

Further, the Employee's continued employment shall not constitute consent to, or
a waiver of right with respect to, any circumstance constituting Good Reason
hereunder.

          (e) Notice of Termination. Any purported termination of the Employee's
employment by the Company or by the Employee (other than termination due to the
Employee's death, since the Employee's death terminates the Employee's
employment automatically) occurring on or before the Target Date shall be
communicated by written Notice of Termination to the other party hereto in
accordance with Section 7. For purposes of this Agreement, "Notice of
Termination" means a notice that shall indicate the specific termination
provision in this Agreement relied upon, shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of the
Employee's employment under the provision so indicated and shall set forth a
date (the "Date of Termination") which follows the date of that notice. If,
notwithstanding the foregoing, the Employee's employment is being terminated by
the Employee for Good Reason, the Date of Termination may not be more than
thirty (30) days from the date of that notice or more than three (3) months from
the date of the events giving rise to that Good Reason, whichever first occurs.

          (f) Date of Termination. If the Company seeks to terminate the
Employee's employment for Cause, the date of termination of the Employee's
employment shall be the Date of Termination, except that if the consequences of
the act or omission to act set forth in the pertinent Notice of Termination is
curable (and cure is allowed under such circumstances) then the date of
termination of the Employee's employment shall be the date which is the
thirty-first (31st) day following the Date of Termination, unless the Employee
shall have cured such consequences prior to that date, in which case the
Employee's employment shall not terminate. Subject to a different date set forth
in a Notice of Termination provided under Section 3(e), if the Employee seeks to
terminate the Employee's employment with the Company for Good Reason, the date
of termination of the Employee's employment shall be the Date of Termination.
The date that the Employee's employment actually terminates is hereinafter
referred to herein as the "Final Date".

     4. Compensation upon Termination.

          (a) Non-Payment Termination. In the event of a Non-Payment
Termination, the Company shall pay to Employee the Employee's full base salary,
when due, through the Final Date at the rate in effect immediately prior to the
delivery of the pertinent Notice of Termination, if a Notice of Termination was
required to have been given, or if it was not, then on the Final Date, plus all
other amounts to which the Employee is entitled under any compensation plan of
the Company at the time such payments are due, and the Company shall have no
further obligations to the Employee under Section 1 or otherwise under this
Agreement.

          (b) Payment Termination. In the event of a Payment Termination, then,
subject to Section 4(e) and in lieu of any severance benefits to which the
Employee may otherwise be entitled under any severance plan or program of the
Company, the Employee shall

                                        4

<PAGE>

be entitled to the benefits provided below, and the Company shall have no
further obligations to the Employee under Section 1 or otherwise under this
Agreement:

               i. the Company shall pay to Employee the Employee's full base
salary, when due, through the Final Date at the rate in effect immediately prior
to the delivery of the pertinent Notice of Termination (or if the Employee's
termination is for Good Reason by reason of a reduction in the Employee's annual
base salary, the rate in effect immediately prior to such reduction), at the
time specified in Section 4(c), plus all other amounts (other than severance
benefits not provided for in this Agreement) to which the Employee is entitled
under any compensation plan of the Company at the time such payments are due;

               ii. in lieu of any further salary payments to the Employee for
periods subsequent to the Final Date, the Company shall pay as severance pay to
the Employee, at the time specified in Section 4(c), a one-time, lump-sum
severance payment equal to the greater of (1) $2,172,000.00 and (2) the sum of
(A) two hundred percent (200%) of the Employee's annual base salary as in effect
immediately prior to the delivery of the pertinent Notice of Termination (or if
the Employee's termination is for Good Reason by reason of a reduction in the
Employee's annual base salary, the rate in effect immediately prior to such
reduction) and (B) two hundred percent (200%) of the Employee's targeted annual
aggregate bonus amounts for the fiscal year ending June 30, 2006 (or if the
Employee's termination is for Good Reason by reason of a reduction in the
Employee's bonus opportunity, the bonus opportunity in effect immediately prior
to such reduction). In addition, the Company shall pay to the Employee a one
time lump sum cash bonus equal to one hundred percent (100%) of the Employee's
base annual pay effective as of the Notice of Termination date.

               iii. the Company shall, at its sole expense as incurred, provide
the Employee with outplacement services for a period not to exceed nine (9)
consecutive months immediately following the Final Date at an aggregate cost to
the Company not to exceed $12,000, the scope of which shall be selected by the
Employee in the Employee's sole discretion and the provider of which shall be
selected by the Employee from among the providers offered to the Employee by the
Company;

               iv. for the period beginning on the Final Date and ending on the
earlier of (A) the date which is twenty-four (24) full months following the
Final Date or (B) the first day of the Employee's eligibility to participate in
another group health plan, the Company shall pay for and provide the Employee
and the Employee's dependents with the same medical benefits coverage to which
the Employee would have been entitled had the Employee remained continuously
employed by the Company during such period. In the event that the Employee is
ineligible under the terms of the Company's benefit plans to continue to be so
covered, the Company shall provide the Employee with substantially equivalent
coverage through other sources or will provide the Employee with a lump sum
payment (determined on a present value basis using the interest rate provided in
Section 1274(b)(2)(B) of the Internal Revenue Code (the "Code") on the Date of
Termination) in such amount that, after all income and employment taxes on that
amount, shall be equal to the cost to the Employee of providing the Employee
such benefit coverage. At the termination of the benefits coverage under the
first sentence of this Section 4(b)(iv), the Employee and the Employee's
dependents shall be entitled to continuation coverage ("COBRA Coverage")
pursuant to Section 4980B of the Code, Sections 601-608 of the Employee
Retirement Income Security Act of 1974, as amended, and under any other
applicable law, to the extent required by such laws, as if the Employee had
terminated employment with the Company on the date such benefits coverage
terminates; provided, however, that the period of the

                                        5

<PAGE>

Employee's benefits coverage under the first sentence of this Section 4(b)(iv)
shall be offset against the period during which the Employee would be entitled
to such COBRA Coverage; and

               v. the Employee shall be fully vested in the Employee's accrued
benefits under any qualified or nonqualified pension, profit sharing, deferred
compensation or supplemental plans maintained by the Company for the Employee's
benefit; provided, however, that to the extent that the acceleration of vesting
of such benefits would violate any applicable law or require the Company to
accelerate the vesting of the accrued benefits of all participants in such plan
or plans, then, assuming that the Employee obtains the appropriate consents, the
Company shall pay the Employee a lump-sum payment at the time specified in
Section 4(c) in an amount equal to the value of such unvested benefits.

          (c) Timing of Payment. The payments provided for in Sections 4(b)(i),
(ii) and (v) (if applicable) shall be made not later than the fifth (5th)
business day following the Final Date; provided, however, that if the amounts of
such payments cannot be finally determined on or before such date, the Company
shall pay to the Employee on such day an estimate, as determined in good faith
by the Company, of the minimum amount of such payments and shall pay the
remainder of such payments (together with interest at the rate provided in
Section 1274(b)(2)(B) of the Code) as soon as the amount thereof can be
determined but in no event later than the thirtieth (30th) day after the Final
Date. In the event that the amount of the estimated payments exceeds the amount
subsequently determined to have been due, such excess shall constitute a loan by
the Company to the Employee, payable on the fifth (5th) business day after
demand by the Company (together with interest at the rate provided in Section
1274(b)(2)(B) of the Code).

          (d) No Mitigation. The Employee shall not be required to mitigate the
amount of any payment provided for in this Section 4 by seeking other employment
or otherwise nor, except as provided in Section 4(b)(iv), shall the amount of
any payment or benefit provided for in this Section 4 be reduced by any
compensation earned by the Employee as the result of employment by another
employer or self-employment, by retirement benefits, by offset against any
amounts (other than loans or advances to the Employee by the Company) claimed to
be owed by the Employee to the Company, or otherwise.

          (e) Treatment of Payment.

               i. Notwithstanding anything contained herein, if any payment or
distribution to the Employee or for the Employee's benefit (whether paid or
payable or distributed or distributable) pursuant to the terms of this Section 4
(a "Payment") would constitute a "parachute payment" within the meaning of
Section 280G of the Code, the Payments shall be reduced to the extent necessary
so that no portion of the Payments shall be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), but only if, by reason of such
reduction, the net after-tax benefit to the Employee shall exceed the net
after-tax benefit to the Employee if no such reduction was made. For purposes of
this Section 4(e), "net after-tax benefit" shall mean (A) the Payments which the
Employee receives or is then entitled to receive that would constitute
"parachute payments" within the meaning of Section 280G of the Code, less (B)
the amount of all federal, state, local and foreign income and employment taxes
payable with respect to the foregoing calculated at the maximum marginal income
tax rate for each year in which the foregoing shall be paid to the Employee
(based on the rate in effect for such year as set forth in the Code as in effect
at the time of the first payment of the foregoing), less (C) the amount of the
Excise Tax imposed with respect to the Payments. The foregoing determination
will be made by the Accountants (as defined below) in consultation with the
Employee and the Company and in accordance with the analysis, valuations and
calculations prepared by the

                                        6

<PAGE>

Accountants in connection with this Agreement. If the Accountants determine that
such reduction is required by this Section 4(e)(i), the Employee, in the
Employee's sole and absolute discretion, may determine which Payments shall be
reduced to the extent necessary so that no portion thereof shall be subject to
the Excise Tax, and the Company shall pay such reduced amount to the Employee.
The Employee and the Company will each provide the Accountants access to and
copies of any books, records, and documents in the possession of the Employee or
the Company, as the case may be, reasonably requested by the Accountants, and
otherwise cooperate with the Accountants in connection with the preparation and
issuance of the determinations and calculations contemplated by this Section
4(e)(i).

               ii. All determinations required to be made under this Section
4(e), including the assumptions to be utilized in arriving at such
determinations, shall be made by the Accountants which shall provide the
Employee and the Company with its determinations and detailed supporting
calculations with respect thereto at least fifteen (15) business days prior to
the date on which the Employee would be entitled to receive a Payment (or as
soon as practicable in the event that the Accountants have less than fifteen
(15) business days advance notice that the Employee may receive a Payment) in
order that the Employee may determine whether the Employee concurs with such
determination. For the purposes of this Section 4(e), the "Accountants" shall
mean the Company's independent certified public accountants serving immediately
prior to the Final Date. All fees and expenses of the Accountants shall be borne
solely by the Company. For the purposes of determining whether any of the
Payments will be subject to the Excise Tax and the amount of such Excise Tax,
such Payments will be treated as "parachute payments" within the meaning of
Section 280G of the Code, and all "parachute payments" in excess of the "base
amount" (as defined under Section 280G(b)(3) of the Code) shall be treated as
subject to the Excise Tax, unless and except to the extent that in the opinion
of the Accountants such Payments (in whole or in part) either do not constitute
"parachute payments" or represent reasonable compensation for services actually
rendered (within the meaning of Section 280G(b)(4) of the Code) in excess of the
"base amount," or such "parachute payments" are otherwise not subject to such
Excise Tax. Any determination by the Accountants shall be binding upon the
Company and the Employee. As a result of uncertainty in the application of
Section 4999 of the Code at the time of the initial determination by the
Accountants hereunder, it is possible that the amount of the Payments that the
Accountants determine would constitute a "parachute payment" within the meaning
of Section 280G of the Code will have been less than the amount of the Payments
that the Internal Revenue Service (the "IRS") determines constitutes a
"parachute payment" within the meaning of Section 280G of the Code. In such
event, the Employee shall notify the Company in writing of any such claim by the
IRS. Such notification shall be given as soon as practicable after the Employee
is informed in writing of such claim and shall apprise the Company of the nature
of such claim and the date on which such claim is requested to be paid. In
connection with any contest or potential contest of such claim, the Employee and
the Company will provide each other access to and copies of any books, records,
and documents in the possession of the Employee or the Company, as the case may
be, reasonably requested by the other party, and will otherwise cooperate with
each other in connection with any such contest or potential contest. In the
event that the Employee or the Company contest such claim, the Company shall
bear and pay directly all costs and expenses (including additional interest and
penalties) incurred in connection with such contest. If it is finally determined
that the amount of the Payments that the Accountants determined constituted a
"parachute payment" within the meaning of Section 280G of the Code is less than
the amount of the Payments that the IRS determined constituted a "parachute
payment" within the meaning of Section 280G of the Code, the Employee shall
repay to the Company (together with interest at the rate provided in Section
1274(b)(2)(B) of the Code) that amount of the Payments necessary to reduce the
Payments such that no portion thereof shall be subject to the Excise Tax, but
only if,

                                        7

<PAGE>

by reason of such repayment, the net after-tax benefit to the Employee shall
exceed the net after-tax benefit to the Employee if no such repayment was made.
Nothing contained in this Section 4(e)(ii) shall limit the Employee's ability or
entitlement to settle or contest, as the case may be, any claim or issue
asserted or raised by the IRS or any other taxing authority.

          (f) Release. Notwithstanding anything to the contrary contained
herein, as a condition to the effectiveness of this Retention Agreement, the
Employee agrees to execute the Release and Waiver of Claims attached hereto as
Exhibit A (the "Release"), which releases the Company from any and all claims,
liabilities and obligations that may have arisen due to events occurring prior
to the Employee's execution of the Release.

     5. Stock Options; Eligibility for Annual Merit Reviews and Incentive Plans.

          (a) Stock Options. Notwithstanding anything contained herein, all
outstanding options, if any, granted to the Employee under any of the Company's
stock option plans, incentive plans or other similar plans (or options
substituted therefor covering the stock of a successor corporation) shall
continue to be subject to the terms, provisions and limitations of the
applicable stock option plan and option agreement.

          (b) Annual Merit Review; Incentive Plans. The Employee shall continue
to be eligible for annual merit reviews and Company incentive plans.

     6. Successors; Binding Agreement.

          (a) The Company shall require any successor thereof (whether direct or
indirect, by purchase, merger, consolidation or otherwise (a "Change of
Control")) to all or substantially all of the business and/or assets of the
Company to expressly assume and agree to pay and perform, when due, all of the
obligations of the Company to the Employee under this Agreement incurred in
connection with a Change of Control to such successor, to the extent such a
Change of Control occurs on or prior to the Target Date. For the avoidance of
doubt, the Company's obligations under this Section 6(a) shall not be triggered
by a Change of Control of Cardinal or any of other Affiliated Company (other
than the Company).

          (b) This Agreement shall inure to the benefit of and be enforceable by
the Employee and the Employee's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If the
Employee should die while any amount would still be payable to the Employee
hereunder had the Employee continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the terms of this Agreement to
the Employee's devisee, legatee or other designee or, if there is no such
designee, to the Employee's estate.

     7. Notice. For the purpose of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
certified or, registered mail, return receipt requested, postage prepaid,
addressed to the respective addresses set forth on the signature page of this
Agreement, provided that all notices to the Company shall be directed to the
attention of the Board with a copy to the Secretary of the Company, or to such
other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be effective
only upon receipt.

                                        8

<PAGE>

     8. Confidentiality; Non-Solicitation.

          (a) The Employee hereby agrees to continue to be bound by the terms
and conditions of the Confidentiality and Invention Assignment Agreement by and
between the Company and the Employee dated May 10, 2000, attached hereto as
Exhibit B (the "Confidentiality and Invention Assignment Agreement").

          (b) The Employee hereby agrees that, for the period commencing on the
Final Date and terminating on the twelve (12) month anniversary thereof, the
Employee shall not, either on the Employee's own account or jointly with or as a
manager, agent, officer, employee, consultant, partner, joint venturer, owner or
shareholder or otherwise on behalf of any other person, firm or corporation,
directly or indirectly solicit or attempt to solicit away from the Company any
of its officers or employees or offer employment to any person who, on or during
the six (6) months immediately preceding the date of such solicitation or offer,
is or was an officer or employee of the Company; provided, however, that a
general advertisement to which an employee of the Company responds shall in no
event be deemed to result in a breach of this Section 8. Such agreement by the
Employee shall not be deemed to limit in any way any other non-solicitation or
similar agreement between the Employee and the Company.

          (c) The provisions of this Section 8 shall survive the termination or
expiration of this Agreement and the Employee's employment with the Company and
shall be fully enforceable thereafter. If it is determined by a court of
competent jurisdiction in any state or jurisdiction that any restriction in this
Section 8 is excessive in duration or scope or is unreasonable or unenforceable
under the laws of that state or jurisdiction, it is the intention of the parties
that such restriction may be modified or amended by the court to render it
enforceable to the maximum extent permitted by the law of that state or
jurisdiction.

          (d) In the event that the Employee shall breach or threaten to breach
any of the provisions of this Section 8, in addition to and without limiting or
waiving any other remedies available to the Company in law or in equity, the
Company shall be entitled to immediate injunctive relief in any court, domestic
or foreign, having the capacity to grant such relief, to restrain such breach or
threatened breach and to enforce the provisions of this Section 8. The Employee
acknowledges that it is impossible to measure in money the damages that the
Company will sustain in the event that the Employee breaches or threatens to
breach the provisions of this Section 8 and, in the event that the Company shall
institute any action or proceeding to enforce such provisions seeking injunctive
relief, the Employee hereby waives and agrees not to assert and shall not use as
a defense thereto the claim or defense that the Company has an adequate remedy
at law. The foregoing shall be in addition to any remedies available to the
Company at law or in equity.

     9. "At-Will" Relationship Unchanged. The Employee and the Company
acknowledge and agree that the Employee's employment relationship with the
Company shall be and shall remain "at-will" and nothing in this Agreement is
intended to, nor shall be construed to, change the status of that relationship.
Without limiting the generality of the foregoing, the Employee and the Company
shall each be entitled to terminate the Employee's employment relationship with
the Company at any time, with or without notice, for any reason or for no reason
whatsoever.

     10. Entire Agreement. This Agreement sets forth the entire agreement of the
parties hereto in respect of the subject matter contained herein and, except (a)
for the provisions of the Confidentiality and Invention Assignment Agreement,
which provisions shall be supplemented

                                        9

<PAGE>

by this Agreement and shall not be superseded by the provisions herein and (b)
as otherwise expressly provided herein, supersedes all prior agreements,
promises, covenants, arrangements, communications, representations or
warranties, whether oral or written, by any officer, employee or representative
of any party hereto; and any prior agreement of the parties hereto in respect of
the subject matter contained herein, including, without limitation, any prior
change of control agreements or severance agreements, including, but not limited
to, the Change of Control Agreement, is hereby terminated and canceled. No
amendment, modification or waiver of any provision of this Agreement, shall be
effective unless the same shall be in writing and signed by the Company and the
Employee.

     11. Severability. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.

     12. Counterparts. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original, but all of which taken together shall
be one and the same instrument.

     13. Payments. Any payments provided for hereunder shall be paid net of any
applicable withholding required under federal, state, local or foreign law.

     14. Governing Law. This Agreement shall be governed by the laws of the
State of California, without regard to principles of conflicts of law.

     15. Headings; References. The section headings contained in this Agreement
are for convenience only, and shall not affect the interpretation of this
Agreement. All references to sections of the Code shall be deemed also to refer
to any successor provisions to such sections.

     16. Acknowledgement. The Employee acknowledges (a) that the Employee has
consulted with or has had the opportunity to consult with independent counsel of
the Employee's own choice concerning this Agreement, and (b) that the Employee
has read and understands the Agreement, is fully aware of its legal effect, and
has entered into it freely based on the Employee's own judgment and not on any
representations or promises other than those contained in this Agreement.

                            [SIGNATURE PAGE FOLLOWS]

                                       10

<PAGE>

          IN WITNESS WHEREOF, the undersigned, intending to be legally bound,
have executed this Retention Agreement as of the date first set forth above.

COMPANY:                                EMPLOYEE:

ALARIS Medical Systems, Inc.

By: /s/ George Fotiades                 By: /s/ Dave Schlotterbeck
    ---------------------------------       ------------------------------------
Name: George Fotiades                   Name: Dave Schlotterbeck
Title: Cardinal Health, President and
       COO

Date: 9-8-04                            Date: 8-31-04

Address: 7000 Cardinal Place            Address: [Intentionally omitted]
         Dublin Ohio 43017

                                    EXHIBIT A

                          RELEASE AND WAIVER OF CLAIMS

                                   [Attached]

<PAGE>

                                    EXHIBIT B

               CONFIDENTIALITY AND INVENTION ASSIGNMENT AGREEMENT

                                   [Attached]

<PAGE>

                          RELEASE AND WAIVER OF CLAIMS

     In consideration of entering into the Retention Agreement by and between
David L. Schlotterbeck and ALARIS Medical Systems, Inc., a Delaware corporation
(the "Company"), substantially in the form attached hereto as Exhibit A (the
"Retention Agreement"), I, DAVID L. SCHLOTTERBECK, hereby furnish the Company
with the following release and waiver ("Release and Waiver").

     1. In exchange for the consideration provided to me by the Company set
forth in the Retention Agreement that I am not otherwise entitled to receive, I
hereby generally and completely release the Company and its directors, officers,
employees, shareholders, partners, agents, attorneys, predecessors, successors,
parent and subsidiary entities, insurers, affiliates, and assigns from any and
all claims, liabilities and obligations, both known and unknown, that arise out
of or are in any way related to events, acts, conduct, or omissions occurring
prior to my signing this Release and Waiver that arise out of or relate to my
employment relationship with the Company. This general release includes, but is
not limited to:

               (a) all claims arising out of or in any way related to my
     employment with the Company or the termination of that employment;

               (b) all claims related to my compensation or benefits from the
     Company, including salary, bonuses, commissions, vacation pay, expense
     reimbursements, severance pay, fringe benefits, or any ownership interests
     in the Company (as I acknowledge that I have received all compensation or
     benefits owed to me);

               (c) all claims for breach of contract, wrongful termination, and
     breach of the implied covenant of good faith and fair dealing;

               (d) all tort claims, including claims for fraud, defamation,
     emotional distress, and discharge in violation of public policy; and

               (e) all federal, state, and local statutory claims, including
     claims for discrimination, harassment, retaliation, attorneys' fees, or
     other claims arising under the federal Civil Rights Act of 1964 (as
     amended), the federal Americans with Disabilities Act of 1990, the federal
     Age Discrimination in Employment Act of 1967 (as amended) ("ADEA"), the
     California Fair Employment and Housing Act (as amended), the Americans with
     Disabilities Act (as amended), the federal Civil Rights Act of 1991 (as
     amended), the federal Family and Medical Leave Act of 1993 (as amended),
     the federal Consolidated Omnibus Budget Reconciliation Act of 1986 (as
     amended), the federal National Labor Relations Act of 1935 (as amended),
     the federal Labor Management Relations Act of 1947 (as amended), the
     federal Equal Pay Act of 1963 (as amended), the federal Employee Retirement
     Income Security Act of 1974 (as amended), the federal Older Workers'
     Benefit Protection Act of 1990 (as amended), the federal Fair Labor
     Standards Act of 1938 (as amended) and the California Labor Code (as
     amended).

                                        1

<PAGE>

     2. I also acknowledge that I have read and understand Section 1542 of the
California Civil Code which reads as follows:

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

I hereby expressly waive and relinquish all rights and benefits under that
section and any law of any jurisdiction of similar effect with respect to any
claims I may have against the Company.

     3. I acknowledge that, among other rights, I am waiving and releasing any
rights I may have under ADEA, that this Release and Waiver is knowing and
voluntary, and that the consideration given for this Release and Waiver is in
addition to anything of value to which I was already entitled as an executive of
the Company. Since I am forty (40) years of age or older upon execution of this
Release and Waiver, I further acknowledge that I have been advised, as required
by the Older Workers Benefit Protection Act, that: (a) the release and waiver
granted herein does not relate to claims under the ADEA which may arise after
this Release and Waiver is executed; (b) I have the right to consult with an
attorney prior to executing this Release and Waiver (although I may choose
voluntarily not to do so); (c) I have twenty-one (21) days from the date of
termination of my employment with the Company in which to consider this Release
and Waiver (although I may choose voluntarily to execute this Release and Waiver
earlier); (d) I have seven (7) days following the execution of this Release and
Waiver to revoke my consent to this Release and Waiver in writing and delivered
to the Company at 10221 WATERIDGE CIRCLE SAN DIEGO, CA 92121; and (e) this
Release and Waiver, and any benefits accorded herein and in Exhibit A, shall not
be effective until the seven (7) day revocation period has expired.

DATE: 8-31-04                           /s/ David L. Schlotterbeck
                                        ----------------------------------------
                                        (SIGNATURE)

                                        David L. Schlotterbeck
                                        (PRINT NAME)

                                        2

<PAGE>

                                    EXHIBIT A

                               RETENTION AGREEMENT

                                   [Attached]

                                        3

<PAGE>

(ALARIS MEDICAL(R) LOGO)

                              CONFIDENTIALITY AND INVENTION ASSIGNMENT AGREEMENT

     In consideration of my employment by ALARIS Medical Systems, Inc. or any of
its predecessors, successors, assigns, parents, affiliates or subsidiary
companies (collectively, the "Company"), and the opportunity to participate in
product and business development projects, and the compensation paid to me by
the Company:

     1. I understand and acknowledge that the Company has and will develop,
compile and own certain proprietary techniques and information which have great
value to its business and which are not generally known to the public (such
techniques and information are hereafter referred to, collectively, as
"Confidential Information"). All Confidential Information generated by me during
my employment, or by other employees of the Company, shall be the sole property
of the Company and its assigns. I understand that the Company has its own
Confidential Information and will also have access to Confidential Information
of third parties, such as persons or entities for whom the Company performs
services or provides products (collectively, "Third Parties"). As used in this
Agreement, Confidential Information shall be broadly defined and shall include
all information that has or could have commercial value or other utility in the
business in which the Company or Third Parties are engaged or contemplate
becoming engaged. Confidential Information also includes all information, the
unauthorized disclosure of which could be detrimental to the interests of the
Company or Third Parties, whether or not such information is identified as
Confidential Information by the Company or Third Parties. By example and without
limitation, Confidential Information includes any and all information relating
to techniques, processes, drawings, designs, formulas, trade secrets,
innovations, inventions, discoveries, improvements, research and development and
test results, programs and code specifications, equipment, prototypes, data,
know-how, formats, marketing plans, business plans, strategies, forecasts,
unpublished financial information, budgets, projections, and customer and
supplier information, identities, characteristics and agreements.

     2. I hereby agree to regard and preserve as confidential all Confidential
Information obtained by me, and not to publish or disclose any part of same to
others or use or assist others to use, either directly or indirectly, any
Confidential Information for my own purpose or purposes of others during the
term of this employment or thereafter. Further, both during my employment and
thereafter, I will refrain from any acts or omissions that would reduce the
value of such Confidential Information to the Company. I further agree not to
cause the transmission, removal or transport of Confidential Information from
the Company's principal place of business, or such other place of business
specified by the Company, without prior written approval of an authorized
officer of the Company. In the event that I desire to publish the results of my
work for the Company through literature or speeches, I agree to submit such
literature or speeches to the General Counsel of the Company at least 10
business days before dissemination of such information for determination of
whether such disclosure may jeopardize trade secret status or be prejudicial to
the interest of the Company or Third Parties or whether disclosure may
constitute an invasion of privacy of any individual. I agree not to publish,
disclose or otherwise disseminate such information without prior written
approval of the President or General Counsel of the Company. I acknowledge that
the unauthorized disclosure of Confidential Information may be prejudicial to
the interest of the Company or Third Parties and may be an improper disclosure
of trade secrets. I acknowledge that any information of the Company or Third
Parties which is not readily available to the public shall be considered by me
to be Confidential Information unless the Company advises me otherwise.

     3. I hereby agree promptly to disclose to the Company in writing, all
inventions, improvements, developments, designs, ideas, innovations, processes,
techniques, know-how, data, and discoveries, whether or not patentable or
registerable under copyright or similar statutes, that are made, learned,
conceived or reduced to practice by me while in the Company's employ, and for a
period of twelve (12) months after termination of my employment, either solely
or jointly with others, and whether or not during regular working hours
(collectively, "Company Inventions"). "Company Inventions" shall not include any
idea or invention for which no equipment, supplies, facilities, or trade secret
information of the Company was used and which was developed entirely on my own
time, and: (a) which does not relate (i) to the business of the Company, or (ii)
to the Company's actual or demonstrably anticipated research or development; or
(b) which does not result from any work performed by me for the Company.
Furthermore, for California employees only, a Company Invention shall not
include any invention that qualifies fully under the provisions of California
Labor Code Section 2870, a copy of which is attached hereto. For Washington
employees and Washington residents only, a Company Invention shall not include
any invention that qualifies fully under the provisions of Revised Code of
Washington Section 49.44.140, a copy of which is attached hereto.

     4. I hereby acknowledge and agree that all Company Inventions belong to and
are the sole property of the Company. I hereby assign, and agree to assign, to
the Company all my right, title, and interest in and to all such Company
Inventions defined above. I will keep complete, accurate and authentic accounts,
notes, data, and records of any and all such Company Inventions in the manner
and form requested by the Company. Such accounts, notes, data and records,
including all copies, shall be the property of the Company, and, upon its
request, I will promptly surrender them to it, or if not previously surrendered,
I will promptly surrender them to the Company at the conclusion of my
employment.

                                        1

<PAGE>

     5. I further agree that upon request and without compensation therefor, but
at no expense to me, and whether during the term of my employment or thereafter,
I will do all lawful acts, including the execution of papers and lawful oaths
and the giving of testimony, that in the opinion of the Company may be necessary
or desirable in obtaining, sustaining, reissuing, extending, and enforcing
United States and foreign Letters Patent, including Design Patents, on all of
such Company Inventions and for perfecting, affirming, maintaining and recording
the Company's complete ownership and title thereto, and to otherwise cooperate
in all proceedings and matters relating thereto. I further agree that title to
any and all copyrights, copyright registrations, original works of authorship,
and copyrightable subject matter which occur, arise out of or are created as a
result of my employment by the Company shall be the sole and exclusive property
of the Company, and that such works comprise "works made for hire," as that term
is defined in the United States Copyright Act. I hereby assign and agree to
assign all of said copyrights, registrations and subject matter to the Company.
In the event the Company is unable to secure my signature, for any cause, on any
documents necessary to apply for, prosecute, obtain or enforce any patent,
copyright or other right or protection relating to any Company Invention, I
hereby irrevocably designate and appoint the Company and each of its duly
authorized officers and agents as my agent and attorney-in-fact to act for and
in my behalf and stead to execute and file any such document and to do all other
lawfully permitted acts to further the prosecution, issuance and enforcement of
patents, copyrights or other right or protections with the same force and effect
as if executed and delivered by me.

     6. As to any Company Inventions made by me which were made, developed,
devised, conceived or reduced to practice during the period of my employment by
the Company, and up to and including twelve (12) months after termination of my
employment, but which are claimed for any reason to belong to an entity or
person other than the Company, I will promptly disclose the same in writing to
the Company and shall not disclose the same to others if the Company, within
twenty (20) days thereafter, shall claim ownership of such inventions under the
terms of this Agreement. If the Company makes such claim, I agree that any
controversy relating to such claim will be settled and determined by binding
arbitration.

     7. I understand that the Company may enter into agreements or arrangements
with agencies of the United States Government (including, but not limited to,
the National Aeronautics and Space Administration, the Atomic Energy Commission,
and the Department of Defense or Departments thereof), and that the Company may
be subject to laws and regulations which impose obligations, restrictions and
limitations on it with respect to inventions and patents which may be acquired
by it or which may be conceived or developed by employees, consultants or other
agents rendering services to it. I agree that I shall be bound by all such
obligations, restrictions and limitations applicable to any such invention
conceived or developed by me during the period of my employment and shall take
any and all further action which may be required to discharge those obligations
and to comply with those restrictions and limitations.

     8. I agree that upon termination of my employment with the Company, I will
return to the Company promptly and without request all things belonging to the
Company, and that all documents, records, notebooks, and similar repositories of
or containing Confidential Information, including all copies thereof, then in my
possession, whether prepared by me or others, will be left with the Company. I
further agree that I will attend an exit interview, if requested. At the
conclusion of my employment with the Company, I agree to give a written
statement to the Company certifying that I have complied with my obligations
under this Agreement as set forth above and acknowledging my continuing
obligations to disclose Company Inventions, to do certain lawful acts relating
to United States and foreign Letters Patent on the Company Inventions, to not
interfere with the business of the Company in any manner and to preserve as
confidential and refrain from using the Company's Confidential Information. I
recognize that the unauthorized taking of any of the Company's trade secrets may
be a crime under Section 499(c) of the California Penal Code. I further
recognize that such unauthorized taking of the Company's property, including
without limitation, trade secrets, could also result in civil liability under
Civil Code Section 3426, and that a willful taking may result in an award
against me for the Company's attorney's fees and damages. I further agree that
in the event of termination of my employment with the Company (voluntary or
otherwise), I will protect the value of the Confidential Information and Company
Inventions and will prevent the misappropriation or disclosure thereof. I
further agree that for a period of one year following termination of my
employment with the Company, I shall not interfere with the business of the
Company or disrupt the Company's relationship with any of its employees or
customers by inducing or soliciting, or assisting others to induce or solicit,
either directly or indirectly, an employee to leave the Company's employ, a
consultant to sever that consultant's relationship with the Company or a
customer to cease doing business with the Company.

     9. I will exercise reasonable care, consistent with good business judgment,
to preserve in good working order subject to reasonable wear and tear, and to
prevent loss on any instruments or accessories of the Company in my custody for
the purpose of making demonstrations, implementing trials, carrying out
development work, or otherwise conducting the business of the Company. I will
promptly surrender the same to the Company at the conclusion of my employment,
or if not surrendered, I will account to the Company to its reasonable
satisfaction as to the present location of all such instruments or accessories
and the business purpose for their placement at such location. At the conclusion
of my employment with the Company, I agree that no commission will be deemed to
be earned until the return of such instruments or accessories or my accounting
for the same to the Company's

                                        2

<PAGE>

reasonable satisfaction. The value of such instruments not returned will be
determined and deducted in determining final commission and bonus, if any.

     10. I hereby acknowledge and agree that I have been or will be employed by
the Company in a position which could provide the opportunity for designing,
developing, improving, or inventing Confidential Information or Company
Inventions, among my other duties for the Company. I have carefully read this
entire Agreement and fully understand the same. I have been given the
opportunity to consult with independent legal counsel, of my own choosing and at
my own expense. I have listed on Schedule 1 hereof all unpatented, but
potentially patentable, ideas and inventions conceived prior to this employment
(and which have not been assigned to a former employer) and which are,
therefore, excluded from the scope of this Agreement. I acknowledge that the
Company has agreed to receive and hold this disclosure in confidence.

     11. I hereby represent and warrant that there are no other agreements,
relationships or commitments to any other person or entity which conflict with
my obligations to the Company under this Agreement. I further agree that I will
not disclose to the Company, or use or induce the Company to use, any
proprietary information or trade secrets of others. I hereby represent and
warrant that I have returned all property and confidential information belonging
to all prior employers.

     12. This Agreement will be binding upon my heirs, executors,
administrators, or other legal representatives or assigns and is for the benefit
of the Company and its successors and assigns. I understand and acknowledge that
because any breach of this Agreement by me may cause the Company irreparable
harm for which money is inadequate compensation, the Company will be entitled to
injunctive relief to enforce this Agreement in addition to damages and other
available remedies. I further agree that if any action is necessary to enforce
this Agreement, the prevailing party shall be entitled to recover its attorneys'
fees. I understand, acknowledge and agree that the protections set forth in this
Agreement are a material condition to my employment with and compensation by the
Company. I understand that: (a) This Agreement shall be governed by the laws of
the State of California without regard to principles of conflicts of laws; (b)
This Agreement and any confidentiality and non-disclosure agreement and
invention assignment agreement I signed while employed by any predecessor
company acquired by the Company, express the entire understanding of the Company
and the undersigned employee with respect to the subject matter hereof; (c) Each
and all of the several rights and remedies provided for in this Agreement shall
be cumulative; (d) No one right or remedy shall be exclusive of the others or of
any right or remedy allowed in law or in equity; (e) No waiver or indulgence by
the Company of any failure by me to keep or perform any promise or condition of
this Agreement shall be a waiver of any preceding or succeeding breach of the
same or any other promise or condition; (f) No waiver by the Company of any
right shall be construed as a waiver of any other right; (g) The Company shall
not be required to give notice to enforce strict adherence to all terms of this
Agreement.

     13. In the case of any conflicting provision or provisions between this
Agreement and any previous confidentiality and non-disclosure agreement or
invention assignment agreement, the undersigned employee may have entered into
with a predecessor company acquired by the Company, this Agreement shall have
precedence.

     14. If a court finds any provision of this Agreement to be invalid or
unenforceable as applied to any circumstance, I understand and intend that the
remainder of this Agreement and the application of such provision to other
circumstances shall be interpreted so as best to effect the intent of such
provision. I further agree that any such void or unenforceable provision of this
Agreement shall be replaced with a valid and enforceable provision which will
achieve, to the greatest extent possible, the economic, business and other
purposes of the void or unenforceable provision.

     15. I understand and acknowledge that nothing contained in this Agreement
shall limit or otherwise alter either my ability or the Company's ability to
terminate my employment, with or without cause, with or without notice, at any
time. I further understand and acknowledge that my employment with the Company
shall be completely in the discretion of, and at the will of, the Company.

     16. I agree that my employment with the Company requires my undivided
attention and effort. Therefore, during my employment with the Company, I will
not, without providing the Company reasonable prior notice and obtaining the
Company's prior express written consent, engage in any employment or business
other than for the Company, or assist in any manner any business competitive
with the business or future business plans of the Company.

     I UNDERSTAND THIS AGREEMENT AFFECTS MY RIGHTS TO INNOVATIONS, INVENTIONS
AND IDEAS MADE DURING MY EMPLOYMENT AND RESTRICTS MY RIGHT TO DISCLOSE OR USE
THE COMPANY'S CONFIDENTIAL INFORMATION DURING OR SUBSEQUENT TO MY EMPLOYMENT. I
HAVE READ THIS AGREEMENT CAREFULLY AND UNDERSTAND ITS TERMS. I HAVE COMPLETELY
FILLED OUT THE LIST OF PRIOR INVENTIONS BELOW, IF ANY.

Signature /s/ David L. Schlotterbeck     Date     May 10, 2000
          ---------------------------        -----------------------------------

                                        3

<PAGE>

Print Name  David L. Schlotterbeck
           ------------------------------

                       EMPLOYEE'S LIST OF PRIOR INVENTIONS

Employee Name:                          Date:
               ----------------------         ----------------------------------

<TABLE>
<CAPTION>
Invention Description   Patent No.   Date of Issue
---------------------   ----------   -------------
<S>                     <C>          <C>

</TABLE>

                                        4

<PAGE>

      THE FOLLOWING SECTION APPLIES TO CALIFORNIA AND WASHINGTON EMPLOYEES
                          AND WASHINGTON RESIDENTS ONLY

                        WRITTEN NOTIFICATION TO EMPLOYEE

     In accordance with California Labor Code Section 2872 and Revised Code of
Washington Section 49.44.140, you are hereby notified that your Employee
Confidentiality and Invention Assignment Agreement does not require you to
assign to the Company any invention for which no equipment, supplies, facility,
or trade secret information of the Company was used and which was developed
entirely on your own time, and which does not relate to the business of the
Company or to the Company's actual or demonstrably anticipated research or
development, or which does not result from any work performed by you for the
Company. However, you are required to disclose all inventions you develop during
your employment by the Company, whether or not during regular working hours.

     THE FOLLOWING IS THE TEXT OF CALIFORNIA LABOR CODE SECTION 2870:

     "(a) Any provision in an employment agreement which provides that an
employee shall assign, or offer to assign, any of his or her rights in an
invention to his or her employer shall not apply to an invention that the
employee developed entirely on his or her own time without using the employer's
equipment, supplies, facilities, or trade secret information except for those
inventions that either:

          (1)  Relate at the time of conception or reduction to practice of the
               invention to the employer's business, or actual or demonstrably
               anticipated research or development of the employer; or

          (2)  Result from any work performed by the employee for the employer.

     (b) To the extent a provision in an employment agreement purports to
require an employee to assign an invention otherwise excluded from being
required to be assigned under subdivision (a), the provision is against the
public policy of this state and is unenforceable."

     THE FOLLOWING IS THE TEXT OF THE REVISED CODE OF WASHINGTON SECTION
49.44.140:

     "A provision in an employment agreement which provides that an employee
shall assign or offer to assign any of the employee's rights in an invention to
the employer does not apply to an invention for which no equipment, supplies,
facilities, or trade secret information of the employer was used and which was
developed entirely on the employee's own time, unless

     (a) the invention relates (i) directly to the business of the employer, or
(ii) to the employer's actual or demonstrably anticipated research or
development, or

     (b) the invention results from any work performed by the employee for the
employer. Any provision which purports to apply to such an invention is to that
extent against the public policy of this state and is to that extent void and
unenforceable."

     I HEREBY ACKNOWLEDGE RECEIPT OF THIS WRITTEN NOTIFICATION CONTAINING
CALIFORNIA LABOR CODE SECTION 2870 AND REVISED CODE OF WASHINGTON SECTION
49.44.140.

Signature /s/ David L. Schlotterbeck     Date     May 10, 2000
          ---------------------------         ---------------------------------
Print Name  David L. Schlotterbeck
           --------------------------

                                        5

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