Document:

<PAGE>   1

                                                                    EXHIBIT 10.2

                                RELEASE AGREEMENT

          This Release Agreement is made and entered into effective on the 27th
day of June, 2000 between Jeffrey A. Hutsell, an individual resident of Illinois
("Hutsell") and Enesco Group, Inc. a Massachusetts corporation with its
principal place of business located in Itasca, Illinois, ("Enesco").

          WHEREAS, Hutsell and Enesco entered into an Employment Agreement dated
June 29, 1999 pursuant to which Hutsell was retained by Enesco as its President
and Chief Executive Officer (the "Employment Agreement"), a copy of which is
attached to and incorporated by this reference in this Agreement as Exhibit "1";
and

          WHEREAS, Hutsell and Enesco have mutually agreed to the resignation of
Hutsell as a Director and President and Chief Executive Officer of Enesco and
all of subsidiaries of Enesco, which resignation was effective June 27, 2000;
and

          WHEREAS, the parties desire to enter into this Release Agreement
pursuant to the Employment Agreement on the terms and conditions hereafter set
forth;

          Now, therefore, for good and valuable consideration, the receipt and
sufficiency of which are expressly acknowledged by both Hutsell and Enesco, it
is hereby agreed as follows:

          1. Employment Status. Hutsell's employment with Enesco terminated on
June 27, 2000 (the "Termination Date"). As of the Termination Date, Hutsell's
salary as an employee of Enesco ceased and any entitlement Hutsell has or might
have under any Enesco-provided benefit programs terminated, except as required
by applicable law and regulation and except as expressly provided in this
Agreement and the Employment Agreement.

          2. Salary and Benefits. The parties acknowledge and agree that Hutsell
is entitled to receive the salary, bonus and benefits provided for in Paragraph
4(e) of the Employment Agreement as summarized in the letter dated September 14,
2000 attached as Exhibit "A", and in consideration for the Release by Hutsell
provided in Paragraph 3 of this Agreement, but provided that Hutsell does not
revoke this Agreement as provided in paragraph 10(a) and except as specified in
paragraph 9, Enesco covenants and agrees to provide such salary, bonus and
benefits as defined in Paragraphs 3(a), 3(b) and 3(c) of the Employment
Agreement, as modified by Paragraph 4(e) of the Employment Agreement for a
period of three years from the date of this Agreement until June 26, 2003, as
summarized in the letter dated September 14, 2000 attached as Exhibit "A".

          3. Release. In exchange for the payments and other benefits described
in Paragraph 2 and other good and valuable consideration, Hutsell hereby agrees
that Hutsell and Hutsell's representatives, heirs, executors, administrators,
agents, estate, successors and assigns release and forever discharge Enesco, its
affiliates and/or their respective successors, predecessors, assigns, directors,
stockholders, officers, employees and/or agents, both individually and in their
official capacities with Enesco and/or its affiliates, from any and all actions,
causes of action, suits, claims, demands, obligations, costs, judgments,
complaints, contracts, agreements, promises, debts, claims, damages and
liabilities of whatever kind or nature, at law, in equity or otherwise, whether
existing or

<PAGE>   2

contingent, known or unknown, arising out of Hutsell's employment with or
Hutsell's termination of employment from Enesco; provided, however, that nothing
contained herein shall limit Hutsell's right to enforce the Employment
Agreement, Hutsell's rights under any benefit plans of Enesco, or Hutsell's
right to indemnification as a director, officer or employee of Enesco and its
affiliates. This release is intended by Hutsell to be all-encompassing and to
act as the full and total release of any claims (other than to enforce the
Employment Agreement or to seek indemnification as aforesaid) that Hutsell may
have or has had against Enesco and/or its affiliates and/or their successors,
predecessors, assigns, directors, stockholders, officers, employees and/or
agents, both individually and in their official capacities with Enesco and/or
its affiliates, including but not limited to claims arising under common law,
contracts, implied contract, public policy, tort, personal injury, or any
federal, state or local statute, law, constitution, ordinance, regulation or
order, including but not limited to the Age Discrimination in Employment Act, as
amended, 29 U.S.C. 621, et seq., the Employment Retirement Income Security Act,
Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act,
the Family and Medical Leave Act, the Illinois Human Rights Act, Ill. Rev. Stat.
Ch. 68, Sec. 1-101, et seq. and/or any applicable employment related federal,
state or local statute, law, ordinance, regulation or order in the United
States.

          4. Waiver of Rights and Claims Under The Age Discrimination In
Employment Act, As Amended. Hutsell has been informed that, because Hutsell is
40 years of age or older, Hutsell has or might have specific rights and/or
claims under the Age Discrimination in Employment Act, as amended. In connection
with the consideration described in Paragraph 2 above, Associate specifically
waives such rights and/or claims to the extent that such rights and/or claims
arose prior to the date this Agreement was executed, as more fully set forth in
Paragraph 10(a).

          5. Company Files, Documents And Other Property. Hutsell warrants that,
on or prior to the date of execution of this Agreement, Hutsell has returned to
Enesco and/or one or more affiliates of Enesco all keys, laptop computers,
cellular telephones, hand held personal data organizers, other equipment, credit
cards or other items, including all business files, reports, books, data and
documents, that have been in Hutsell's possession and that are the property of
Enesco and/or one or more affiliates.

          6. Change in Control. The obligation of Enesco to continue and to
provide the salary and benefits to Hutsell as set forth in Paragraph 2 of this
Agreement shall survive any change in control of Enesco by merger, acquisition
or other means and shall continue as an obligation of Enesco and any successor
in interest of Enesco.

          7. Stock Options. All outstanding vested Stock Options previously
awarded to Hutsell by Enesco shall continue on the terms and conditions set
forth in the respective Stock Option Plan Agreements pursuant to which they were
awarded.

          8. Expenses. Enesco shall reimburse Hutsell for all outstanding
expenses incurred in connection with the business of Enesco and Hutsell agreed
to submit expense reports to Enesco for all such expenses within thirty (30)
days of the date of this Agreement.

<PAGE>   3

          9.  Survival of Other Obligations. The obligations and undertakings of
Hutsell set forth in Paragraphs 5 and 6 of the Employment Agreement shall
continue in full force and effect according to their terms, and Enesco's
continuing obligations pursuant to Paragraph 2 of this Agreement and Paragraph
4(e) of the Employment Agreement are expressly conditioned upon Hutsell's
continued compliance with Paragraphs 5 and 6 of the Employment Agreement and the
execution and return of this Release Agreement, and Hutsell's not revoking this
Agreement after its execution, pursuant to Paragraph 10(a).

          10. Representations And Governing Law.

               (a) Hutsell has been advised by Enesco to consult with an
attorney prior to executing this Agreement and Hutsell acknowledges and
represents that he has retained the services of Fred Tannenbaum, Esquire of
Gould & Ratner to represent him in connection with this Agreement. Hutsell
acknowledges that Hutsell understands the terms and effect of this Agreement and
that Hutsell has had twenty-one days to consider whether to execute this
Agreement. Hutsell further acknowledges that within seven days from the date of
the execution of this Agreement, Hutsell may, at Hutsell's sole option, revoke
this Agreement upon written notice to General Counsel, Enesco Group, Inc., 225
Windsor Drive, Itasca, IL 60143 and that this Agreement will not become
effective until the seven day revocation period has expired.

               (b) This Agreement represents the complete understanding between
the parties, supersedes any and all other agreements, letters, memoranda,
correspondence and understandings, whether oral or written, except as expressly
stated hereto to the contrary, and may not be modified, altered or changed
except upon written consent of the parties. If any of the provisions of the
Agreement are determined to be invalid or inoperative, such determination shall
not affect the efficacy of the remainder of the Agreement and any such invalid
or inoperative provision shall be deemed severable.

               (c) The Agreement shall be governed by and construed in
accordance with the Laws of the State of Illinois, without giving effect to the
principles of conflicts of law thereof.

               (d) Hutsell represents that Hutsell has read the foregoing
Agreement, fully understands the terms and conditions of this Agreement and is
knowlingly and voluntarily executing the same without any duress or undue
influence. In entering into the Agreement, Hutsell does not rely on any
representation, promise or inducement made by Enesco and/or its affiliates, with
the exception of the consideration described in this document. Hutsell
understands that, once Hutsell executes the Agreement and after expiration of
the revocation period provided in Paragraph 10(a), Hutsell will be bound by its
terms.

               (e) The Employee agrees to cooperate fully with the Company and
any of the parties released under Paragraph 3 in investigating, defending
prosecuting, litigating, filing, initiating or asserting any claims or potential
claims (whether legal equitable, administrative, or other) that may be made by
or against the

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Company or any of the other parties released under paragraph 3 and that may
relate to or arise out of the Employee's employment with the Company. Company
agrees to reimburse to Employee any reasonable expenses incurred by Employee for
travel, hotel, and similar costs in connection with Employee's compliance with
this paragraph, and further agrees to provide reasonable prior notice of any
necessary compliance in order to minimize interference with Employee's
employment responsibilities with any other employer.

               (f) Nothing in this Agreement is intended to or shall be
construed as an admission by the Company or any of the other parties released
under Paragraph 3 that any of them violated any law, interfered with any right,
breached any obligation or otherwise engaged in any improper or illegal conduct
with respect to the Employee or otherwise. The Company and the other parties
released under Paragraph 3 expressly deny any such illegal or wrongful conduct.

          Executed this 25th day of September, 2000.

Enesco Group, Inc.

By: /s/ John F. Cauley                           /s/ Jeffrey A. Hutsell
   -----------------------------------------     -----------------------------
    John F. Cauley                               Jeffrey A. Hutsell
    Chairman of the Board

<PAGE>   5

[LETTERHEAD OF ENESCO]

September 14, 2000

Fred Tannenbaum, Esq.
Gould & Ratner
8th Floor
222 North LaSalle Street
Chicago, IL  60601

Re:  Jeff Hutsell Release Agreement

Dear Fred:

I have reviewed our correspondence and telephone conversations regarding Jeff
Hutsell's Employment Agreement and Release with the Board and have explained the
requests you made in our last phone conversation of two weeks ago. The Board has
made its final decision of these open matters which are summarized below:

In order to minimize any future questions, I am again summarizing below the
various aspects of the severance to which Jeff is entitled under his Employment
Agreement and Company Policy by incorporating the items from my August 4 and
August 22 letters to you, modified to the extent possible to accommodate your
most recent comments and suggestions. A revised Release Agreement is attached,
incorporating the agreed changes. These items are contingent on execution and
non-revocation of the Release Agreement:

1)   Salary. The annual base salary of $495,000 will be continued for three
     years from June 27, 2000 to June 26, 2003 and will be payable bi-weekly in
     accordance with Enesco's normal payroll practices.

2)   Car Allowances. The car allowance of $30,000 annually will be continued for
     three years from June 27, 2000 to June 26, 2003, subject to increase based
     on periodic review by Enesco's Treasury Department as provided in Section
     3(c) of the Employment Agreement and will be payable bi-weekly. I have
     requested the Payroll Department to be sure that the car allowance is
     included with the bi-weekly checks and to make up any shortfalls once the
     Release Agreement is finally effective.

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Page Two
September 14, 2000

3)   Management Incentive Bonus. Jeff's participation in the Management
     Incentive Bonus Plan of Enesco will continue for the calendar years 2000,
     2001 and 2002, in accordance with the terms of that Plan, except that any
     bonus will be based on corporate performance rather than individual
     performance goals, as provided in Section 4(e) of the Employment Agreement.
     No MIP bonus will apply for 2003 as the Plan expressly requires employment
     on December 31, 2003 to qualify. For your information, Mr. Seawright was
     entitled to a pro-rated MIP for the final, partial calendar year of his
     three year severance period, because the MIP Plan then in effect
     specifically provided for such pro-ration. The MIP Plan was subsequently
     changed in 1999 at Jeff's insistence to provide that an associate must be
     employed on December 31 to be eligible for the MIP.

4)   Medical Annual Executive Benefit. This benefit in the amount of $5,000
     annually, will continue in full for 2001, 2002 and 2003. In addition, Jeff
     will be reimbursed for an annual physical exam in 2001, 2002 and 2003
     (prior to June 27, 2000) up to $500 annually on presentment of a statement
     of the charges.

5)   Financial Planning Annual Benefit. This benefit in the amount of $5,000
     annually, will continue in full for 2001, 2002 and 2003.

6)   Life Insurance. Reimbursement for term life insurance premiums on Jeff's
     life for coverage up to 3 times the annual final base salary will continue
     for coverage through June 26, 2003, on presentment of premium statements.
     Jeff will be reimbursed for the full premium amount, unless the premium
     rate for the same coverage level from the Company's then group life
     insurance carrier is less, in which case Jeff will be reimbursed only for
     the lower group cost for the same level of coverage. Jeff will be notified
     if there is a change in the group life insurance carrier and a resulting
     reduction in group life insurance rates.

7)   Short Term and Long Term Disability Insurance. This coverage will be
     continued at no less than the current levels through June 26, 2003, subject
     to increase based on periodic review by Enesco's Treasury Department as
     provided in Section 3(c) of the Employment Agreement. A summary of the
     current coverage has been requested and will be provided shortly.

8)   Health Insurance. Coverage under Enesco's group health, vision, drug and
     dental insurance plans will be continued for both Jeff and his wife to the
     earlier of age 65 for each, death or eligibility for Medicare, at not less
     than the current levels of coverage, subject to increase based on periodic
     review by Enesco's Treasury Department as provided in Section 3(c) of the
     Employment Agreement and on not less than the same proportionate premium
     contribution levels applicable to Enesco employees, as modified from time
     to time. Coverage also will include Jeff's other eligible dependents (as
     defined in the applicable plans) through June 26, 2003.

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Page Three
September 14, 2000

9)   Retirement 401(K) Plan. Contributions and coverage will be provided as
     stated in the applicable Plan, a copy of which was attached to the August 4
     letter. There is no provision in the 401K Plan for participation by a
     non-employee, and federal tax law prohibits participation by a
     non-employee. Mr. Seawright also was not eligible to participate after the
     date of his termination as an employee and did not participate. The Board
     has determined not to make an exception in Jeff's case.

10)  Stock Options. Outstanding stock options granted to Jeff will be treated as
     provided in each applicable Plan, based on his termination date of June 27,
     2000.

11)  Other Benefits. The Employment Agreement also provides for continuation of
     all other "standard" insurance and other benefits maintained by Enesco for
     its employees and directors, for the period ending June 26, 2003; however,
     I am not aware of any other such standard benefits which would be included
     in Jeff's post termination compensation. The provision of a laptop
     computer, Palm Pilot, monthly phone bills and AOL and AT&T Internet
     connections were treated by Enesco as business expenses of Enesco, not as
     employment benefits granted to Jeff. For that reason, they were not
     reported as income to Jeff on his W-2 forms. These employee expenses can no
     longer be continued after Jeff's termination, although it has been agreed
     that Jeff can purchase the laptop and Palm Pilot, if he wishes to do so, at
     current residual value. The IT Department will prepare a separate statement
     of this residual value once this Release is signed, and Jeff can then
     decide either to send a check or return the equipment. The charitable
     contribution match will continue for the three year term, with a pro-ration
     for 2003. Any vacation accrued on a proportionate basis up to June 27,
     2000, reduced by any vacation charged through June 27, will be paid in full
     when the Release becomes effective and is not revoked as provided in
     Paragraph 10(a) of the Release.

          Jeff was already covered under the D&O policy and By-law
indemnification provision for any claim, whenever made, based on Jeff's conduct
or actions while an Enesco employee; therefore, there is no special language
amendment required to cover these matters. In that regard, we discussed the
pending lawsuit filed by Royce & Company, naming Jeff as a party, based on
alleged insider stock purchases. A copy of the Complaint and the retainer letter
for Jeff from Skadden, Arps, Slate, Meagher & Flom is attached.

          There is no provision allowing future elective deferrals under the
Cafeteria Plans since tax deferrals are only available to employees under
applicable tax law and Enesco therefore can no longer continue such deferrals. I
have raised your request for continuation of the pre-tax or tax deferral
benefits, and the Board has decided that there is no basis for an exception for
Jeff.

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Page Four
September 14, 2000

          I trust you will find the enclosed Release Agreement in order and that
we can proceed with the execution. As provided in the Employment Agreement, the
Release is to be in form satisfactory to Enesco. Please return two fully
executed originals to me for signing by Enesco, after which I will return a
fully-executed original to you. Also, please have Jeff sign the formal
Resignation which I sent to you already (copy attached) and both copies of the
enclosed retainer letter from Skadden, Arps.

Sincerely,

/s/ Robert J. Hipple

Robert J. Hipple
Senior Vice President and General Counsel

Attachments<PAGE>   1
EXHIBIT 10

                              EMPLOYMENT AGREEMENT

         THIS AGREEMENT ("Agreement") is made and entered into as of September
1, 2000 by and between RICHARD A. LINDEN (the "Executive") and MERGE
TECHNOLOGIES INCORPORATED, a Wisconsin corporation (the "Company").

                                R E C I T A L S:

         A. The Company is engaged in the provision of medical diagnostic
imaging connectivity hardware, software and consulting solutions therefor, for
healthcare facilities. The business in which the Company is engaged in
time-to-time during the term of this Agreement, inclusive of those new lines of
business, if any, in which the Company is working toward entering from
time-to-time are hereinafter collectively referred to as the "Business"; and

         B. The Company desires to employ the Executive and the Executive
desires to accept such employment;

                  NOW THEREFORE, in consideration of the promises, mutual
covenants and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Company and the Executive do hereby agree as follows:

                  1. Employment and Duties. On the terms and subject to the
conditions set forth in this Agreement, the Company agrees to employ the
Executive as the President and Chief Executive Officer of the Company to perform
such duties as are consistent with such position(s) as may be assigned, from
time to time, by the Board of Directors of the Company (the "Board") and to
render such additional services and discharge such other responsibilities as the
Board may, from time to time, stipulate.

                  2. Performance. The Executive accepts the employment described
in Section 1 of this Agreement and agrees to devote all of his working time and
efforts to the faithful and diligent performance of the services described
herein, including the performance of such other services and responsibilities as
the Board may, from time to time, stipulate. Without limiting the generality of
the foregoing, the Executive ordinarily shall devote not less than five days per
week except for regular business holidays observed by the Company, the
Executive's vacation days, and days allowed for sick leave to his employment
with respect to the Company Business.

                  3. Term. The term of employment under this Agreement shall
commence on September 1, 2000 (the "Commencement Date") and shall remain in
effect until terminated by either Executive or the Company by giving thirty (30)
days written notice of termination. The period of time in which Executive is
employed shall constitute the "Employment Period," and each calendar year or
portion of a calendar year during the Employment Period is hereinafter sometimes
referred to as a "Year." The parties agree that this Agreement may be terminated
by either party without cause or good reason, and without the obligation to pay
any severance pay, at any time, subject to the aforesaid notice requirement.

                  4. Salary. For all the services to be rendered by the
Executive hereunder, the Company agrees to pay a salary at a rate of no less
than sixteen thousand six hundred sixty-six and 67/100 dollars ($16,666.67) per
month ("Salary"), payable in the manner and frequency in which the Company's
payroll is customarily handled, and subject to annual review at the time annual
reviews of the salaries of other senior executive officers are to be conducted.

                  5. Bonus. During the Employment Period, the Executive shall be
eligible for an annual performance bonus of up to twenty-five percent (25%) of
Salary, dependent on achievement of defined performance targets. These targets
will be mutually agreed upon by the Executive and the Executive Committee of the
Board within sixty (60) days after commencement of each Year. For each Year the
annual performance

                                       15

<PAGE>   2
bonus is to be paid, it shall be paid within thirty (30) days of the completion
of the year-end financial statements for that Year, but in no event later than
May 31 of the following year. Upon achievement of defined performance targets,
the Executive will be eligible to receive a pro-rated bonus equal to twenty-five
percent (25%) of the annual performance bonus for calendar year 2000, with
respect to operations of the Company during the calendar year 2000. Any dispute
as to whether Executive met the performance targets for a Year shall be
determined conclusively by the Executive Committee of the Board.

                  6.       Paid Time Off. The Executive shall be entitled to
paid time off for vacation, illness, holiday and personal reasons in
accordance with the Company's paid time off policy at the rate offered to the
most senior employees of the Company with the longest tenure.

                  7.       Relocation Allowance. Should the Executive, within
eighteen (18) months of Commencement Date, move his permanent residence at least
thirty-five (35) miles closer to the Company's offices in Milwaukee, then the
Company will reimburse Executive's relocation costs, up to a maximum of twenty
thousand dollars ($20,000).

                  8.       Insurance.  During the Employment Period, the
Company shall be entitled to procure life insurance for the Company's
sole benefit and at the Company's sole cost and the Executive agrees to
cooperate in obtaining such insurance.

                  9.       Disability Benefit. If at any time during the
Employment Period the Executive is permanently unable to perform fully his
duties hereunder by reason of illness, accident, or other disability (as
confirmed by competent medical evidence by a physician selected by the Executive
Committee), the Executive shall be entitled to receive periodic payments of
Salary to which he would otherwise be entitled pursuant to Section 4 of this
Agreement by reason of his employment for a period of two (2) months.
Notwithstanding the foregoing provision (i) the amounts payable to the Executive
pursuant to this Section 9 shall be reduced by any amounts received by the
Executive with respect to any such incapacity pursuant to any insurance policy,
plan, or other employee benefit provided to the Executive by the Company; and
(ii) in no event will the terms of this Agreement supersede any health or
disability benefit to which Executive is entitled under applicable state or
federal law.

                  10.      Executive Options. The Executive shall be granted
options to acquire two hundred twenty thousand (220,000) shares of the Company's
common stock at the closing market price (the "Strike Price") at the end of the
day on the date immediately preceding the Commencement Date. These options will
vest at the rate of twenty-five percent (25%) of the total number of shares
subject to options (or fifty-five thousand (55,000) shares) beginning one year
after the Commencement Date and thereafter an additional twenty-five percent
(25%) of such number of shares will vest on each of the second, third and fourth
year anniversaries of the Commencement Date. The options will be exercisable for
a period of six (6) years from the Commencement Date, subject to the terms of
the Company's Employee Stock Option Plan (the "Plan"). Additional options may be
granted in succeeding years, in the sole discretion of the Board. In the event
that Executive is terminated without cause during the Employment Period and
prior to the first twenty-five percent (25%) of the total options referenced
herein vesting, upon such termination and at the sole discretion of the Board,
either: (i) fifty-five thousand (55,000) shares (aggregating twenty-five percent
(25%) of the options referenced herein) will vest immediately, or (ii) the
Company will compensate Executive for such unvested fifty-five thousand (55,000)
shares with the difference between the Strike Price and the closing market price
of the Company's common stock as of the day of Executive's termination, adjusted
by an amount necessary to compensate Executive for the fact that such payment
will be taxed as ordinary income by the Internal Revenue Service and not as
capital gains.

         The Company's Employee Stock Option Plan currently has restrictions on
the quantity of options, which may be issued to any one participant per fiscal
year. The Company hereby agrees to resolve this limitation through a new
proposal or amendment at the November, 2000 Board meeting to permit the grant of
options for the number of shares called for herein. In the event that this has
not occurred by December 31, 2000, the Company shall award Executive the maximum
number of options allowable under the Plan for fiscal year 2000, and the maximum
number of options allowable under the plan for each Year thereafter until
Executive has been

                                       16

<PAGE>   3
awarded 220,000 options. In the event Executive is terminated following the
first anniversary of the Commencement Date but before he has been awarded
220,000 options, all of the options granted through the date of his termination
shall immediately vest, and in the sole discretion of the Board, the Executive
shall receive either (i) the number of options equal to the difference between
the number of options he was awarded through the date of his termination and
220,000, which options shall immediately vest; or (ii) an amount equal to the
difference between the Purchase Price and the closing market price on the date
of termination multiplied by the number of options described in clause (i) of
this sentence, adjusted by an amount necessary to compensate Executive for the
fact that such payment will be taxed as ordinary income by the Internal Revenue
Service and not as capital gains. The Executive shall receive the options to be
awarded under clause (i) of the preceding sentence or the amount of money to be
paid pursuant to clause (ii) of the preceding sentence within thirty (30) days
of his termination.

                  11.      Change in Control. In the event of a "change in
control" of the Company ("change in control" of the Company shall mean a change
in the ownership of fifty percent (50%) or more of the outstanding stock of the
Company in a single transaction or a change of fifty percent (50%) or more of
the members of the Board in a single transaction, other than pursuant to
nomination of a new slate of directors where there has been no material change
in beneficial ownership of the Company, within 180 days preceding such
nomination, then all of the options granted as of the Commencement Date (options
to purchase two hundred twenty thousand (220,000) shares) will immediately vest
and become exercisable. In the event of a change in control as (described above)
and the Executive is: (i) involuntarily terminated within 120 days following the
change in control; or (ii) voluntarily terminates his employment with the
Company within 120 days, following either: (a) any reduction in Executive's
responsibilities or authority with respect to the Business; (b) a reduction in
Executive's compensation package, including Salary, in effect immediately prior
to the change in control; or (c) the relocation of the Company's principal place
of business more than 30 miles further from Executive's residence as of the date
of this Agreement; then the Executive will be entitled to twelve (12) months
Salary as a change in control allowance, to be paid in a single payment within
thirty (30) days of the termination of Executive's employment.

                  12.      Share Purchase and Loan. During the first six (6)
months following the Commencement Date, the Executive will be entitled to
purchase up to two hundred thousand dollars ($200,000) of shares of common stock
from the Company's treasury ("Shares") at the closing price(s) of the Company's
common stock on the date(s) of purchase. The Company agrees to loan up to fifty
percent (50%) of the funds invested to purchase the Shares (up to one hundred
thousand dollars ($100,000)) as a full recourse loan bearing interest at the
Applicable Federal Rate at the time of the Loan and secured by a first security
interest in the Shares. In addition to the Promissory Note (the form of which is
attached as Exhibit A) and Security Agreement, Executive will be required to
deliver to the Company at the time of the Loan assignments separate from
certificate duly endorsed in blank by the Executive. Executive will be required
to pay interest monthly. The principal amount of the loan must be repaid by
Executive upon the earliest to occur of (i) sale of any of the Shares, (ii)
termination of Executive's employment with the Company, or (iii) six (6) years
from the date the loan is issued.

                  13.      Other Benefits.  Except as otherwise specifically
provided herein, during the Employment Period, the Executive shall be eligible
for all non-wage benefits the Company provides generally for its other salaried
employees.

                  14.      Business Expenses.

                           (a) Reimbursement. The Company shall reimburse the
                  Executive for the reasonable, ordinary, and necessary business
                  expenses incurred by him in connection with the performance of
                  his duties hereunder, including, but not limited to, ordinary
                  and necessary travel expenses and entertainment expenses and
                  mobile phone expenses.

                           (b) Accounting. The Executive shall provide the
                  Company with an accounting of his expenses, which accounting
                  shall clearly reflect which expenses are reimbursable by the
                  Company. The Executive shall provide the Company with such
                  other supporting documentation and other

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<PAGE>   4
                  substantiation of reimbursable expenses as will conform to
                  Internal Revenue Service or other requirements. All such
                  reimbursements shall be payable by the Company to the
                  Executive promptly after receipt by the Company of appropriate
                  documentation therefor.

                  15.      Severance. In the event that the Executive is
terminated for any reason other than gross negligence, commission of a felony in
connection with his employment or material violation of any established Company
policies, the Company shall pay the Executive, as a severance allowance, an
amount equal to four (4) months of his then current salary if such termination
occurs on or before February 28, 2001, five (5) months of his then current
salary if such termination occurs between March 1, 2001 and August 31, 2001, or
six (6) months of his then current salary if such termination occurs after
September 1, 2001. The amount of the severance allowance provided for in this
Section 15 shall be paid in a single lump sum within thirty (30) days of the
termination of the Executive's employment. From time to time after September 1,
2001, the Executive's severance allowance shall be subject to review and
adjustment at the time reviews and adjustments of the severance allowance for
other senior executives of Company are to be conducted. Notwithstanding anything
to the contrary contained herein, in the event the Executive elects to receive
(pursuant to the operation of Section 11) twelve (12) months' Salary following a
change in control event and Executive's voluntary or involuntary termination,
then Executive shall not be entitled to any payment of severance pursuant to
this Section 15. In the event a change in control occurs and the Executive is
not entitled to twelve (12) months' Salary pursuant to Section 11, then the
Executive shall continue to be entitled to receive severance payments per this
Section 15.

                  16.      Surrender of Properties. Upon termination of the
Executive's employment with the Company, regardless of the cause therefor, the
Executive shall promptly surrender to the Company all property provided him by
the Company for use in relation to his employment, and, in addition, the
Executive shall surrender to the Company any and all confidential sales
materials, lists of customers and prospective customers, price lists, files,
patent applications, records, models, or other materials and information of or
pertaining to the Company or its customers or prospective customers or the
products, Business, and operations of the Company in his possession.

                  17.      Inventions and Secrecy. Except as otherwise provided
in this Section 17, the Executive:

                           (a) shall hold in a fiduciary capacity for the
                  benefit of the Company all secret or confidential information,
                  knowledge, or data of the Company or its Business or
                  production operations obtained by the Executive during his
                  employment by the Company, which shall not be generally known
                  to the public or recognized as standard practice (whether or
                  not developed by the Executive) and shall not, during his
                  employment by the Company and after the termination of such
                  employment for any reason, communicate or divulge any such
                  information, knowledge or data to any person, firm or
                  corporation other than the Company or persons, firms or
                  corporations designated by the Company;

                           (b) shall promptly disclose to the Company all
                  inventions, ideas, devices, and processes made or conceived by
                  him alone or jointly with others, from the time of entering
                  the Company's employ until such employment is terminated,
                  relevant or pertinent in any way, whether directly or
                  indirectly, to the Company's Business or production operations
                  or resulting from or suggested by any work which he may have
                  done for the Company or at its request;

                           (c) shall, at all times during his employment with
                  the Company, assist the Company (entirely at the Company's
                  expense) to obtain and develop for the Company's benefit
                  patents on such inventions, ideas, devices and processes,
                  whether or not patented; and

                           (d) shall do all such acts and execute, acknowledge
                  and deliver all such instruments as may be necessary or
                  desirable in the opinion of the Company to vest in the Company
                  the entire interest in such inventions, ideas, devices, and
                  processes referred to above.

The foregoing to the contrary notwithstanding, the Executive shall not be
required to assign or offer to assign to the Company any of the Executive's
rights in any invention for which no equipment, supplies, facility, or trade
secret information of the Company was used and which was developed entirely on
the Executive's own time,

                                       18

<PAGE>   5
unless: (A) the invention related to (i) the Business of the Company; or (ii)
the Company's actual or demonstrably anticipated (with the realistic prospect of
occurring) research or development; or (B) the invention results from any work
performed by the Executive for the Company. The Executive acknowledges his prior
receipt of written notification of the limitation set forth in the preceding
sentence on the Executive's obligation to assign or offer to assign to the
Company the Executive's rights in inventions.

                  18.      Confidentiality of Information: Duty of
Non-Disclosure.

                           (a) The Executive acknowledges and agrees that his
                  employment by the Company under this Agreement necessarily
                  involves his understanding of and access to certain trade
                  secrets and confidential information pertaining to the
                  Business of the Company. Accordingly, the Executive agrees
                  that after the date of this Agreement at all times he will
                  not, directly or indirectly, without the express consent of
                  the Company, disclose to or use for the benefit of any person,
                  corporation or other entity, or for himself any and all files,
                  trade secrets or other confidential information concerning the
                  internal affairs of the Company, including, but not limited
                  to, information pertaining to its customers, prospective
                  customers, services, products, earnings, finances, operations,
                  methods or other activities, provided, however, that the
                  foregoing shall not apply to information which is of public
                  record or is generally known, disclosed or available to the
                  general public or the industry generally, or known by
                  Executive prior to his employment with the Company. Further,
                  the Executive agrees that he shall not, directly or
                  indirectly, remove or retain, without the express prior
                  written consent of the Company, and upon termination of this
                  Agreement for any reason shall return to the Company, any
                  confidential figures, calculations, letters, papers, records,
                  computer disks, computer print-outs, lists, documents,
                  instruments, drawings, designs, programs, brochures, sales
                  literature, or any copies thereof, or any information or
                  instruments derived therefrom, or any other similar
                  information of any type or description, however such
                  information might be obtained or recorded, arising out of or
                  in any way relating to the Business of the Company or obtained
                  as a result of his employment by the Company. The Executive
                  acknowledges that all of the foregoing are proprietary
                  information, and are the exclusive property of the Company.
                  The covenants contained in this Section 18 shall survive the
                  termination of this Agreement.

                           (b) The Executive agrees and acknowledges that the
                  Company does not have any adequate remedy at law for the
                  breach or threatened breach by the Executive of his covenant,
                  and agrees that the Company shall be entitled to injunctive
                  relief to bar the Executive from such breach or threatened
                  breach in addition to any other remedies which may be
                  available to the Company at law or in equity.

                  19.      Covenant Not to Compete.

                           (a) During Employment Period. During the Employment
                  Period, the Executive shall not, without the prior written
                  consent of the Company, which consent may be withheld at the
                  sole and reasonable discretion of the Company, engage in any
                  other business activity for gain, profit, or other pecuniary
                  advantage (excepting the investment of funds in such form or
                  manner as will not require any services on the part of the
                  Executive in the operation of the affairs of the companies in
                  which such investments are made) or engage in or in any manner
                  be connected or concerned, directly or indirectly, whether as
                  an officer, director, stockholder, partner, owner, employee,
                  creditor, or otherwise, with the operation, management, or
                  conduct of any business that competes with the Business of the
                  Company.

                           (b) Following Termination of Employment Period.
                  Within the two (2) year period immediately following the end
                  of the Employment Period, regardless of the reason therefor,
                  the Executive shall not, without the prior written consent of
                  the Company, which consent may be withheld at the sole
                  discretion of the Company: (A) engage in or in any manner be
                  connected or concerned, directly or indirectly, whether as an
                  officer, director, stockholder, partner, owner, employee,
                  creditor, or otherwise with the operation, management, or
                  conduct of any business similar to the Business being
                  conducted at the time of such termination within a 100-mile
                  radius from Milwaukee, Wisconsin; (B) directly solicit,
                  contact, interfere with, or divert any customer served by the
                  Company for the Business,

                                       19

<PAGE>   6
                  or any prospective customer identified by or on behalf of the
                  Company, during the Executive's employment with the Company;
                  or (C) directly solicit any employee then employed by the
                  Company or previously employed by the Company within the one
                  year period preceding termination of the Executive's
                  employment with the Company to join the Executive, whether as
                  a partner, agent, employee or otherwise, in any enterprise
                  engaged in a business similar to the Business of the Company
                  being conducted at the time of such termination.

                           (c) Acknowledgment. The Executive acknowledges that
                  the restrictions set forth in Section 19 are reasonable in
                  scope and essential to the preservation of the Business of the
                  Company and proprietary properties and that the enforcement
                  thereof will not in any manner preclude the Executive, in the
                  event of the Executive's termination of employment with the
                  Company, from becoming gainfully employed in such manner and
                  to such extent as to provide a standard of living for himself,
                  the members of his family, and those dependent upon him of at
                  least the sort and fashion to which he and they have become
                  accustomed and may expect.

                           (d) Severability. The covenants of the Executive
                  contained in Section 19 of this Agreement shall each be
                  construed as an agreement independent of any other provision
                  in this Agreement, and the existence of any claim or cause of
                  action of the Executive against the Company, whether
                  predicated on this Agreement or otherwise, shall not
                  constitute a defense to the enforcement by the Company of such
                  covenants. Both parties hereby expressly agree and contract
                  that it is not the intention of either party to violate any
                  public policy, or statutory or common law, and that if any
                  sentence, paragraph, clause, or combination of the same of
                  this Agreement is in violation of the law, such sentence,
                  paragraph, clause or combination of the same shall be void,
                  and the remainder of such paragraph and this Agreement shall
                  remain binding on the parties to make the covenants of this
                  Agreement binding only to the extent that it may be lawfully
                  done. In the event that any part of any covenant of this
                  Agreement is determined by a court of law to be overly broad
                  thereby making the covenant unenforceable, the parties hereto
                  agree, and it is their desire, that such court shall
                  substitute a judicially enforceable limitation in its place,
                  and that as so modified the covenant shall be binding upon the
                  parties as if originally set forth herein.

                  20.      Arbitration.

                           (a) Subject to the terms of Section 21(h) below, upon
                  presentation of a written claim or claims (collectively
                  "Claims") arising out of or relating to this Agreement, or the
                  breach hereof, by an aggrieved party, the other party shall
                  have thirty (30) days in which to make such inquiries of the
                  aggrieved party and conduct such investigations as it believes
                  reasonably necessary to determine the validity of the Claims.
                  At the end of such period of investigation, the complained of
                  party shall either pay the amount of the Claims or the
                  arbitration proceeding described in Section 20(b) shall be
                  invoked, subject to the terms of Section 20(g) below.

                           (b) In the event that the Claims are not settled by
                  the procedure set forth in Section 20(a), the Claims shall be
                  submitted to arbitration conducted in accordance with the
                  Commercial Arbitration Rules ("Rules") of the American
                  Arbitration Association ("AAA") except as amplified or
                  otherwise varied hereby.

                           (c) The parties shall submit the dispute to the
                  Milwaukee, Wisconsin regional office of the AAA and the situs
                  of the arbitration shall be Milwaukee, Wisconsin.

                           (d) The arbitration shall be conducted by a single
                  arbitrator. The parties shall appoint the single arbitrator to
                  arbitrate the dispute within ten (10) business days of the
                  submission of the dispute. In the absence of agreement as to
                  the identity of the single arbitrator to arbitrate the dispute
                  within such time, the AAA is authorized to appoint an
                  arbitrator in accordance with the rules, except that the
                  arbitrator shall have as his principal place of business the
                  Milwaukee, Wisconsin metropolitan area.

                                       20

<PAGE>   7
                           (e)      The single arbitrator  selected by AAA shall
                  be an attorney licensed to practice by the State of Wisconsin.

                           (f) Anything in the Rules to the contrary
                  notwithstanding, the arbitration award shall be made in
                  accordance with the following procedure: (i) in the event the
                  dispute involves monetary relief, each party shall, at the
                  commencement of the arbitration hearing, submit an initial
                  statement of the amount each party proposes be selected by the
                  arbitrator as the arbitration award ("Settlement Amount").
                  During the course of the arbitration, each party may vary its
                  proposed Settlement Amount. At the end of the arbitration
                  hearing, each party shall submit to the arbitrator its final
                  Settlement Amount ("Final Settlement Amount"), and the
                  arbitrator shall be required to select either one or the other
                  Final Settlement Amounts as the arbitration award without
                  discretion to select any other amount as the award. The
                  arbitration award shall be paid within thirty (30) business
                  days after the award has been made, together with interest
                  from the date of award at the rate of nine percent (9%).
                  Judgment upon the award may be entered in any federal or state
                  court having jurisdiction over the parties; (ii) in the event
                  the dispute involves the interpretation of this Agreement,
                  each party shall submit an initial statement of the
                  interpretation each party proposes be selected by the
                  arbitrator as the arbitration award ("Proposed
                  Interpretation"). During the course of the arbitration, each
                  party may vary its Proposed Interpretation. At the end of the
                  arbitration hearing, each party shall submit to the arbitrator
                  its final Proposed Interpretation, and the arbitrator shall
                  select either one or the other final Proposed Interpretations,
                  or a reasonable alternative, as the arbitration award.
                  Judgment upon the award may be entered in any federal or state
                  court having jurisdiction over the parties.

                           (g) Notwithstanding anything to the contrary
                  contained herein, any matter which pursuant to the terms of
                  this Agreement is to be resolved by the Board or the Executive
                  Committee of the Board in its sole discretion shall be so
                  resolved without arbitration.

                  21.      General Provisions.

                           (a) Goodwill. The Company has invested substantial
                  time and money in the development of its products, services,
                  territories, advertising and marketing thereof, soliciting
                  clients and creating goodwill. By accepting employment with
                  the Company, the Executive acknowledges that the customers are
                  the customers of the Company, and that any goodwill created by
                  the Executive belongs to and shall inure to the benefit of the
                  Company.

                           (b) Notices. Any notice required or permitted
                  hereunder shall be made in writing (i) either by actual
                  delivery of the notice into the hands of the party thereunder
                  entitled, or (ii) by depositing the notice with a nationally
                  recognized overnight delivery service, all shipping costs
                  prepaid and addressed to the party to whom the notice is to be
                  given at the party's respective address set forth below, or
                  such other address as the parties may from time to time
                  designate by written notice as herein provided.
<TABLE>
<S>                                                       <C>
                   As addressed to the Company:           With a copy to:

                   Merge Technologies Incorporated        Shefsky & Froelich Ltd.
                   1126 South 70th Street                 444 North Michigan Avenue
                   Milwaukee, Wisconsin 53214-3151        Suite 2500
                   Attention:  Chief Financial Officer    Chicago, Illinois 60611
                                                          Attention: Mitchell D. Goldsmith, Esq.
</TABLE>

                                       21

<PAGE>   8
<TABLE>
<S>                                                   <C>
                  As addressed to the Executive:      With a copy to:

                  Mr. Richard A. Linden               Schwartz & Freeman
                  1003 Oakland Court                  401 North Michigan Avenue
                  Barrington, Illinois 60010          Suite 1900
                                                      Chicago, Illinois 60611
                                                      Attention: Thomas Y. Mandler, Esq.
</TABLE>

                  The notice shall be deemed to be received on the date of its
                  actual receipt by the party entitled thereto.

                           (c) Amendment and Waiver. No amendment or
                  modification of this Agreement shall be valid or binding upon
                  the Company unless made in writing and signed by an officer of
                  the Company duly authorized by the Board or upon the Executive
                  unless made in writing and signed by him. The waiver by the
                  Company of the breach of any provision of this Agreement by
                  the Executive shall not operate or be construed as a waiver of
                  any subsequent breach by him.

                           (d) Entire Agreement. This Agreement constitutes the
                  entire Agreement between the parties with respect to the
                  Executive's duties and compensation as an executive of the
                  Company, and there are no representations, warranties,
                  agreements or commitments between the parties hereto with
                  respect to his employment except as set forth herein. No
                  presumption shall be made in favor or against either party
                  based upon who has served as draftsman of this Agreement.

                           (e) Governing Law. This Agreement shall be governed
                  by and construed in accordance with the internal laws (and not
                  the law of conflicts) of the State of Illinois.

                           (f) Severability. If any provision of this Agreement
                  shall, for any reason, be held unenforceable, such provision
                  shall be severed from this Agreement unless, as a result of
                  such severance, the Agreement fails to reflect the basic
                  intent of the parties. If the Agreement continues to reflect
                  the basic intent of the parties, then the invalidity of such
                  specific provision shall not affect the enforceability of any
                  other provision herein, and the remaining provisions shall
                  remain in full force and effect.

                           (g) Assignment. The Executive may not under any
                  circumstances delegate any of his rights and obligations
                  hereunder without first obtaining the prior written consent of
                  the Company. This Agreement and all of the Company's rights
                  and obligations hereunder may be assigned or transferred by
                  it, in whole or in part, to be binding upon and inure to the
                  benefit of any subsidiary or successor of the Company,
                  provided either the successor has a net worth greater than the
                  Company at the time of assignment or the Company remains
                  primarily liable with respect to the obligations so assigned.

                           (h) Costs of Enforcement, Litigation. In the event of
                  any suit or proceeding seeking to enforce the terms,
                  covenants, or conditions of this Agreement, the prevailing
                  party shall, in addition to all other remedies and relief that
                  may be available under this Agreement or applicable law,
                  recover his or its reasonable attorneys' fees and costs as
                  shall be determined and awarded by the court. Notwithstanding
                  anything to the contrary contained in Section 20 above or
                  elsewhere herein any controversy or dispute with respect to
                  the terms of Section 16, 17, 18 or 19 of this Agreement will
                  survive termination of this Agreement and shall be litigated
                  in the state of federal courts of competent jurisdiction
                  situated in Milwaukee, Wisconsin, to which jurisdiction and
                  venue all parties consent.

                           (i) Mitigation. The Executive shall be obligated to
                  mitigate his damages as a result of voluntary or involuntary
                  termination of employment with the Company. Should the
                  Executive be entitled to change in control payments pursuant
                  to Section 11 or severance payments pursuant to Section 15,
                  then, to the extent that during the twelve (12) month period
                  following change in control termination of employment or
                  during the period of time for which severance payments are
                  paid out

                                       22

<PAGE>   9
                  (i.e., four, five or six months based upon pre-severance
                  tenure), the Executive receives or accrues direct or indirect
                  compensation for the provision of services (whether an
                  employee, consultant, independent contractor or otherwise,
                  either directly or to an entity controlled by or otherwise
                  affiliated with the Executive), then all such compensation
                  shall be credited dollar-for-dollar to reduce the change in
                  control or severance obligation of the Company to the
                  Executive pursuant to the terms of Section 11 or Section 15,
                  respectively.

                  [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

                                       23

<PAGE>   10
         IN WITNESS WHEREOF, this Agreement is entered into as of the day and
year first above written.

                           COMPANY:

                           MERGE TECHNOLOGIES INCORPORATED

                           By:     /s/ HYMIE S. NEGIN
                                   ----------------------------------
                                   Hymie S. Negin, Chairman
                                   Executive Committee of the Board of Directors

                          EXECUTIVE:

                          By:      /s/ RICHARD A.LINDEN
                                   -----------------------------------
                                   RICHARD A. LINDEN

                                       24

<PAGE>   11
                                   EXHIBIT A

                          FORM OF STOCK PURCHASE NOTE

                                       25

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