2002 Compensation Plan Agreement for Thomas Sparrvik and KMC

Summary

This agreement outlines the 2002 compensation plan for Thomas Sparrvik with KMC. It reduces his base salary to $2,000 per month and removes him from company benefit plans starting January 1, 2002. Instead, he is eligible for quarterly and annual bonuses based on KMC's operating profit and revenue targets, with specific payout thresholds. Bonuses are subject to approval by the Audit Committee Chairman, and certain conditions must be met for payment. The agreement supplements Sparrvik's existing contract and is effective for all four quarters of 2002.

EX-10.24 3 dex1024.txt 2002COMPENSATION PLAN FOR THOMAS SPARRVIK Exhibit 10.24 November 12, 2001 2002 Compensation Plan for Thomas Sparrvik The main focus this year is to grow the company and continue on the path of profitability. The main challenge will be to continue to motivate the staff while located in San Diego. This reward system intends to motivate you to fulfill both the Company tasks and, in the long term, create shareholder value for all shareholders of KMC The existing contract between us will remain in effect as a base contract, however, your monthly base salary will be reduced to $2000/month effective 01/01/02, and you will not be part of the KMC benefit plans as of that date. A "per quarter" bonus will be paid to you, based on the following quarterly Operating Profit: - ---------------- . If less than $150K, then $0/Qtr. . If more than $150K, but less than $399K, then $5,000/Qtr. . If more than $400K, but less than $600K, then $7,500/Qtr. . If more than $600K, butless than $900K, then $10,000/Qtr. . If more than $900K, then $15,000/Qtr. A "year end" bonus of $20,000 will be paid to you if the 2002 Annual Operating ---------------- Profit for KMC exceeds $2.0 million. - ------ A "year end" bonus will be paid to you based on the following 2002 annual Revenue results: - ------- . If at least $18.5 million, then $7,500. . If between $18.5 million and $21.5 million, then an additional $12,500, prorated. . If $21.5 million or more, then $20,000. Before the bonuses are paid, financial results must be received and approved by the Audit Committee Chairman. No Q3 or Q4 bonus will be paid if the 2002 YTD cumulative Operating Profit at the end of these quarters is less than $1 million. This agreement will be added to your existing contract and will be in effect Q1 through Q4, 2002. /s/ Thomas Sparrvik /s/ Richard L. Poss - ------------------------- -------------------------------- Thomas Sparrvik Richard L. Poss President/CEO Chairman, Compensation Committee /s/ David C. Malmberg -------------------------------- David C. Malmberg Chairman