Chief Operating Officer Employment Agreement

EMPLOYMENT AGREEMENT


This Employment agreement ("Agreement") is entered into as of November 28, 1995, between Pixsys, Inc., d/b/a Image Guided Technologies, Inc., a Colorado corporation (the "Company"), and Robert E. Silligman ("Silligman").


In consideration of the mutual covenants and conditions set forth herein, the parties hereby agree as follows:


1. EMPLOYMENT. The Company hereby employs Silligman in the capacity of President and Chief Operating Officer. Silligman accepts such employment and agrees to perform such services as are customary to such office and as shall from time to time be assigned to him by the Chairman of the Board or the Board of Directors.


2. TERM. Subject to earlier termination as provided in Section 5, the employment hereunder shall be for a period of two years, commencing on November 28, 1995 (the "Commencement Date") and ending on November 30, 1997. At the end of the two-year period (provided the Agreement has not been previously terminated), the parties hereto shall consider, without any obligation to do so, extending the Agreement for an additional one-year period. Silligman's employment will be on a full-time basis requiring the devotion of such amount of his productive time as is necessary for the efficient operation of the business of the Company.


3. COMPENSATION AND BENEFITS.


3.1 SALARY. For the performance of Silligman's duties hereunder, the Company shall pay Silligman an annual salary of $90,000, payable (less required withholdings) no less frequently than twice monthly.


3.2 BENEFITS. Silligman shall be entitled to such medical, disability and life insurance coverage and such vacation, sick leave and holiday benefits, if any, as are made available to the Company's top executive personnel, all in accordance with the Company's benefits program in effect from time to time.


3.3 REIMBURSEMENT OF EXPENSES. Silligman shall be entitled to be reimbursed for all reasonable expenses, including but not limited to expenses for travel, meals and entertainment, incurred by Silligman in connection with and reasonably related to the furtherance of the Company's business.


3.4 ANNUAL REVIEW. On each anniversary of the Commencement Date, the Board of Directors will review Silligman's performance and compensation hereunder (including salary, bonus and stock options and/or other equity incentives) and will consider whether to increase such compensation, but will not have authority, as the result of such review, to decrease any portion of such compensation without the written consent of Silligman.


4. CHANGE OF CONTROL. In the event of a Change of Control of the Company (as defined below), all options then granted to Silligman which are unvested at the date of the Change of Control will be immediately vested. In addition, in the event of a termination of Silligman's employment hereunder for any reason (other than as set forth in Section 5.1(f)) following a Change of Control, the Company will promptly pay Silligman, in addition to the amounts required under Section 5.2(a), a lump sum severance amount payable immediately upon such termination of employment, equal to one-half of his then annual salary. This payout shall be in lieu of any amount which may otherwise be due under Section 5.2(b).


As used herein, a "Change of Control" of the Company shall be deemed to have occurred:


(a) Upon the consummation, in one transaction or a series of related transactions, of the sale or other transfer of voting power (including voting power exercisable on a contingent or deferred basis as well as immediately exercisable voting power) representing effective control of the Company to a person or group of related persons who, on the date of this Agreement, is not affiliated (within the meaning of the Securities Act of 1933) with the Company, whether such sale or transfer results from a tender offer or otherwise; or


(b) Upon the consummation of a merger or consolidation in which the Company is a constituent corporation and in which the Company's shareholders immediately prior thereto will beneficially own, immediately thereafter, securities of the Company or any surviving or new corporation resulting therefrom having less than a majority of the voting power of the Company or any such surviving or new corporation; or


(c) Upon the consummation of a sale, lease, exchange or other transfer or disposition by the Company of all or substantially all its assets to any person or group of related persons.


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5. TERMINATION.


5.1 TERMINATION EVENTS. The employment hereunder will terminate upon the occurrence of any of the following events:


(a) Silligman dies;


(b) The Company, by written notice to Silligman or his personal representative, discharges Silligman due to the inability to perform the duties assigned to him hereunder for a continuous period exceeding 90 days by reason of injury, physical or mental illness or other disability, which condition has been certified by a physician; provided, however, that prior to discharging Silligman due to such disability, the Company shall give a written statement of findings to Silligman or his personal representative setting forth specifically the nature of the disability and the resulting performance failu ...