Exhibit 10.19

 

Execution Copy

 

SEPARATION AND NON-COMPETE AGREEMENT

 

This Separation and Non-Compete Agreement is entered into as of January 16, 2008
(“Execution Date”) by and between Vital Images, Inc. (“Company”), a Minnesota
corporation, and Jay D. Miller (“Employee”), a resident of the State of
Minnesota.

 

1.             DEFINITIONS.  WE INTEND ALL WORDS USED IN THIS SEPARATION AND
NON-COMPETE AGREEMENT (“AGREEMENT”) TO HAVE THEIR PLAIN MEANINGS IN ORDINARY
ENGLISH.  SPECIFIC TERMS WE USE IN THIS AGREEMENT HAVE THE FOLLOWING MEANINGS:

 

A.            EMPLOYEE, AS USED HEREIN, SHALL INCLUDE THE UNDERSIGNED EMPLOYEE
AND ANYONE WHO HAS OBTAINED ANY LEGAL RIGHTS OR CLAIMS THROUGH THE UNDERSIGNED
EMPLOYEE.

 

B.            COMPANY, AS USED HEREIN, SHALL AT ALL TIMES MEAN VITAL
IMAGES, INC., ITS PARENT COMPANY, THEIR SUBSIDIARIES, SUCCESSORS AND ASSIGNS,
THEIR AFFILIATED AND PREDECESSOR COMPANIES, THEIR SUCCESSORS AND ASSIGNS, THEIR
AFFILIATED AND PREDECESSOR COMPANIES AND THE PRESENT OR FORMER DIRECTORS,
OFFICERS, EMPLOYEES, REPRESENTATIVES AND AGENTS (INCLUDING, WITHOUT LIMITATION,
ITS ACCOUNTANTS AND ATTORNEYS) OF ANY OF THEM, WHETHER IN THEIR INDIVIDUAL OR
OFFICIAL CAPACITIES, AND THE CURRENT AND FORMER TRUSTEES OR ADMINISTRATORS OF
ANY PENSION OR OTHER BENEFIT PLAN APPLICABLE TO EMPLOYEES OR FORMER EMPLOYEES OF
COMPANY, IN THEIR OFFICIAL OR INDIVIDUAL CAPACITIES.

 

C.            COMPETITIVE PRODUCTS AND SERVICES, AS USED HEREIN, SHALL INCLUDE
ALL PRODUCTS AND SERVICES SIMILAR TO OR THE SAME AS THOSE OFFERED BY COMPANY TO
ITS CUSTOMERS INVOLVING ADVANCED MEDICAL VISUALIZATION AND ANALYSIS SOFTWARE
TECHNOLOGIES BEYOND MIP (MINIMUM INTENSITY PROJECTION) AND MPR (MULTI PLANAR
REFORMATION) THAT ALLOW FOR ANALYSIS, MANIPULATION, AND DISTRIBUTION OF IMAGES,
SUCH AS RADIOLOGICAL STUDIES, IN 2D, 3D AND 4D.

 

D.            EMPLOYEE’S CLAIMS, AS USED HEREIN, MEANS ALL OF THE RIGHTS
EMPLOYEE, HAS ON OR PRIOR TO THE DATE HEREOF, TO ANY RELIEF OF ANY KIND FROM
COMPANY, WHETHER OR NOT EMPLOYEE NOW KNOWS ABOUT THOSE RIGHTS, ARISING OUT OF
HIS EMPLOYMENT WITH COMPANY, AND HIS EMPLOYMENT TERMINATION, INCLUDING, BUT NOT
LIMITED TO, CLAIMS ARISING UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT, AS
AMENDED BY THE OLDER WORKERS BENEFIT PROTECTION ACT; THE MINNESOTA HUMAN RIGHTS
ACT; THE AMERICANS WITH DISABILITIES ACT; TITLE VII OF THE CIVIL RIGHTS ACT OF
1964, AS AMENDED; THE MINNESOTA WHISTLEBLOWER ACT; OR OTHER FEDERAL, STATE OR
LOCAL CIVIL RIGHTS LAWS; CLAIMS PURSUANT TO THAT CERTAIN EMPLOYMENT AGREEMENT
BETWEEN COMPANY AND EMPLOYEE DATED FEBRUARY 9, 2002 (THE “EMPLOYMENT
AGREEMENT”); CLAIMS PURSUANT TO THAT CERTAIN AMENDED AND RESTATED CHANGE IN
CONTROL AGREEMENT DATED FEBRUARY 9, 2002 (THE “CHANGE IN CONTROL AGREEMENT”);
CLAIMS PURSUANT TO ANY OTHER AGREEMENT, UNDERSTANDING, PLAN OR ARRANGEMENT UNDER
WHICH EMPLOYEE COULD RECEIVE COMPENSATION FROM THE COMPANY, AS THE PARTIES
INTEND FOR THIS AGREEMENT TO SETTLE ALL OBLIGATIONS REMAINING BETWEEN THE
PARTIES; CLAIMS FOR BREACH OF CONTRACT; FRAUD OR MISREPRESENTATION; DEFAMATION,
INTENTIONAL OR NEGLIGENT INFLICTION OF EMOTIONAL DISTRESS; BREACH OF COVENANT OF
GOOD FAITH AND FAIR DEALING; PROMISSORY ESTOPPEL; NEGLIGENCE; WRONGFUL
TERMINATION OF EMPLOYMENT; AND ANY OTHER CLAIMS FOR UNLAWFUL EMPLOYMENT
PRACTICES ARISING ON OR PRIOR TO THE DATE HEREOF; PROVIDED, HOWEVER, THAT THE
TERM “EMPLOYEE’S CLAIMS” SHALL IN NO EVENT INCLUDE

 

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EMPLOYEE’S RIGHTS TO RECEIVE THE PAYMENTS, BENEFITS AND CONTINUING PROTECTIONS
REQUIRED TO BE PROVIDED UNDER THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION,
EMPLOYEE’S RIGHTS TO RECEIVE REIMBURSEMENT OF HIS EXPENSES, IN ACCORDANCE WITH
COMPANY POLICIES, BENEFITS UNDER COMPANY’S LIFE INSURANCE AND 401(K) PLANS AND
SIMILAR FRINGE BENEFIT PROGRAMS FOR WHICH EMPLOYEE WAS ELIGIBLE AS OF THE
SEPARATION DATE, AND UNDER LAWS RELATED THERETO.

 

E.             COMPANY’S CLAIMS, AS USED HEREIN, MEANS ALL OF THE RIGHTS COMPANY
NOW HAS TO ANY RELIEF OF ANY KIND FROM EMPLOYEE, OR FROM HIS HEIRS,
BENEFICIARIES, SUCCESSORS OR ASSIGNS, WHETHER OR NOT COMPANY NOW KNOWS ABOUT
THOSE RIGHTS, ARISING OUT OF EMPLOYEE’S EMPLOYMENT WITH COMPANY ON OR PRIOR TO
THE DATE OF THIS AGREEMENT, INCLUDING, BUT NOT LIMITED TO, CLAIMS FOR BREACH OF
CONTRACT; FRAUD OR MISREPRESENTATION; DEFAMATION, INTENTIONAL OR NEGLIGENT
INFLICTION OF EMOTIONAL DISTRESS; BREACH OF COVENANT OF GOOD FAITH AND FAIR
DEALING, PROMISSORY ESTOPPEL; NEGLIGENCE OR UNDER APPLICABLE FEDERAL, STATE OR
LOCAL LAW.

 

F.             VESTED STOCK OPTIONS, AS USED HEREIN, SHALL MEAN THOSE STOCK
OPTIONS HELD BY EMPLOYEE WHICH ARE VESTED AS OF MAY 15, 2008, AS DESCRIBED ON
SCHEDULE A, ATTACHED HERETO.

 

2.             SEPARATION DATE.  EMPLOYEE SHALL CEASE TO BE AN OFFICER OF THE
COMPANY ON JANUARY 9, 2008.  AFTER JANUARY 9, 2008, EMPLOYEE SHALL CONTINUE AS
AN EMPLOYEE OF THE COMPANY AND WILL REMAIN ON THE COMPANY’S PAYROLL AND BE PAID
ON THE COMPANY’S REGULAR PAY DATES, WHICH ARE TWICE MONTHLY, AT HIS CURRENT RATE
OF BASE SALARY THROUGH JANUARY 31, 2008, AND THEREAFTER AS PROVIDED BELOW
THROUGH MAY 15, 2008 (“SEPARATION DATE”).  FROM JANUARY 10, 2008 THROUGH THE
SEPARATION DATE, EMPLOYEE WILL PROVIDE SUCH TRANSITION SERVICES AS ARE
REASONABLY REQUESTED BY THE CHIEF EXECUTIVE OFFICER OF THE COMPANY, WHO WILL
COORDINATE THE LOGISTICS OF SUCH SERVICES.  AFTER JANUARY 31, 2008, EMPLOYEE
WILL RECEIVE $3,500 PER COMPANY PAY PERIOD, FOR NOT MORE THAN FIVE (5) DAYS OF
SERVICE PER 30 DAY PERIOD, AS SUCH SERVICE IS REASONABLY REQUESTED BY THE CHIEF
EXECUTIVE OFFICER.  EMPLOYEE’S SERVICE WILL INCLUDE ATTENDANCE AT THE ESI
SNOWMASS CONFERENCE FROM FEBRUARY 18 THROUGH FEBRUARY 20, 2008.  IF MORE THAN
FIVE (5) DAYS OF SERVICE PER THIRTY CALENDAR DAY PERIOD AFTER JANUARY 31, 2008
IS REQUESTED AND PROVIDED, COMPANY WILL COMPENSATE EMPLOYEE FOR SUCH SERVICE AT
THE RATE OF $1,400 PER DAY OF SERVICE.  THROUGH THE SEPARATION DATE, EMPLOYEE
WILL BE ENTITLED TO RECEIVE HIS CURRENT HEALTH AND WELFARE BENEFITS, INCLUDING
THE OPPORTUNITY TO CONTRIBUTE TO THE COMPANY’S 401K PLAN.  EXCEPT AS EXPRESSLY
SET FORTH HEREIN, EMPLOYEE SHALL NOT BE ENTITLED TO ANY COMPENSATION OR OTHER
PAYMENTS DURING THE PERIOD FROM AND AFTER JANUARY 9, 2008.  AFTER JANUARY 9,
2008, EMPLOYEE SHALL NO LONGER ACCRUE VACATION TIME.

 

3.             COMPANY’S OBLIGATIONS AND SEVERANCE AGREEMENTS.  IN CONSIDERATION
FOR EMPLOYEE’S AGREEMENTS, COVENANTS AND PROMISES CONTAINED HEREIN, SPECIFICALLY
INCLUDING, BUT NOT LIMITED TO, THE RELEASE OF EMPLOYEE CLAIMS AND EMPLOYEE’S
PROMISES TO REFRAIN FROM COMPETING WITH THE COMPANY AND SOLICITING ITS CLIENTS
AND EMPLOYEES AS SET FORTH HEREIN, COMPANY AND EMPLOYEE AGREE AS FOLLOWS:

 

A.            SEVERANCE PAYMENT.  COMPANY AGREES TO PAY TO EMPLOYEE A SEVERANCE
PAYMENT OF FIVE HUNDRED THOUSAND AND 00/100 DOLLARS ($500,000.00) (“SEVERANCE
PAYMENT”).  THIS SEVERANCE PAYMENT WILL BE PAYABLE IN ONE LUMP SUM ON THE FIRST
DAY OF THE SEVENTH MONTH FOLLOWING THE SEPARATION DATE, I.E., ON NOVEMBER 17,
2008, OR UPON HIS EARLIER

 

 

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DEATH.  THE SEVERANCE PAYMENT SHALL BE SUBJECT TO FEDERAL AND STATE WITHHOLDING
TAXES AND FICA.

 

B.            MEDICAL INSURANCE BENEFITS.  COMPANY, PURSUANT TO FEDERAL AND
STATE LAW, WILL PROVIDE, FOR A PERIOD OF EIGHTEEN (18) MONTHS FOLLOWING THE
SEPARATION DATE (“COBRA PERIOD”), A CONTINUATION OF THE GROUP MEDICAL AND DENTAL
INSURANCE COVERAGE ON THE SAME BASIS AS IT WAS PREVIOUSLY PROVIDED TO EMPLOYEE
BY COMPANY.  THROUGH THE EARLIER OF (I) EMPLOYEE’S PARTICIPATION IN EQUIVALENT
GROUP MEDICAL AND DENTAL INSURANCE BENEFITS WITH A NEW EMPLOYER OR
(II) NOVEMBER 30, 2009 (THE “SUSPENSION DATE”), COMPANY WILL PAY THAT PORTION OF
THE PREMIUM FOR GROUP MEDICAL AND DENTAL INSURANCE THAT IT PAID DURING
EMPLOYEE’S EMPLOYMENT, WITH THE REMAINDER TO BE PAID BY EMPLOYEE.  AFTER THE
SUSPENSION DATE, EMPLOYEE WILL BE REQUIRED TO PAY FOR ALL SUCH BENEFITS FOR THE
REMAINDER OF THE COBRA PERIOD, IF ANY, SHOULD EMPLOYEE ELECT TO CONTINUE COBRA
COVERAGE. AT THE CONCLUSION OF THE SUSPENSION PERIOD, COMPANY WILL PAY EMPLOYEE
AN ADDITIONAL SEVERANCE PAYMENT IN AN AMOUNT EQUAL TO THE COMPANY’S PORTION OF
THE MONTHLY PREMIUM FOR GROUP MEDICAL AND DENTAL INSURANCE FOR EMPLOYEE AS OF
THE EXPIRATION OF THE COBRA PERIOD, MULTIPLIED BY A PERIOD OF SIX (6) MONTHS
(“ADDITIONAL SEVERANCE PAYMENT”). THE ADDITIONAL SEVERANCE PAYMENT SHALL BE
SUBJECT TO FEDERAL AND STATE WITHHOLDING TAXES AND FICA AND EMPLOYEE SHALL BE
SOLELY RESPONSIBLE FOR THE ADDITIONAL TAX CONSEQUENCES, IF ANY, RELATED TO
COMPANY’S PAYMENTS ON EMPLOYEE’S BEHALF AS SET FORTH IN THIS SECTION 3.B.

 

C.            NON-DISPARAGEMENT.  COMPANY AGREES THAT ITS DIRECTORS, SENIOR
OFFICERS AND MANAGERS SHALL NOT DISPARAGE OR DEFAME EMPLOYEE IN ANY RESPECT.

 

D.            RELEASE.  EFFECTIVE AS OF THE EXPIRATION OF THE JANUARY 2008
RESCISSION PERIODS, AS HEREAFTER DEFINED, COMPANY HEREBY RELEASES ALL COMPANY’S
CLAIMS, PROVIDED, HOWEVER, THAT SUCH RELEASE IS NOT INTENDED TO APPLY TO ANY
WILLFUL MISCONDUCT BY EMPLOYEE OF WHICH COMPANY DOES NOT HAVE PRESENT
KNOWLEDGE.  COMPANY AGREES TO PROVIDE A “BRING DOWN” RELEASE IN THE FORM
ATTACHED HERETO AS SCHEDULE B AND INCORPORATED HEREIN BY THIS REFERENCE.  THIS
BRING-DOWN RELEASE WILL BE PROVIDED ON THE SEPARATION DATE, AND ISSUED
SIMULTANEOUSLY WITH AND IN FURTHER CONSIDERATION FOR EMPLOYEE’S BRING-DOWN
RELEASE.  COMPANY’S BRING DOWN RELEASE SHALL BE DELIVERED IN EXCHANGE FOR THE
SIMULTANEOUS DELIVERY TO COMPANY OF EMPLOYEE’S BRING-DOWN RELEASE ON THE
SEPARATION DATE, BUT ITS EFFECTIVENESS SHALL BE CONTINGENT UPON THE EXPIRATION
OF EMPLOYEE’S MAY 2008 RESCISSION PERIODS, WITHOUT RESCISSION OF EMPLOYEE’S
BRING-DOWN RELEASE.  IN THE EVENT EMPLOYEE RESCINDS HIS BRING-DOWN RELEASE,
COMPANY’S BRING-DOWN RELEASE SHALL AUTOMATICALLY BECOME NULL AND VOID WITHOUT
FURTHER NOTICE.

 

E.             EXTENSION OF EXERCISE PERIOD FOR VESTED STOCK OPTIONS.  THE
COMPANY SHALL EXTEND EMPLOYEE’S TIME PERIOD TO EXERCISE THOSE VESTED STOCK
OPTIONS SET FORTH ON SCHEDULE A, OTHER THAN OPTION NOS. 435 AND 436, UNTIL THE
EARLIER OF MAY 15, 2011 OR THE DATE SET FORTH ON SCHEDULE A.  EMPLOYEE’S
NON-VESTED OPTIONS SHALL TERMINATE ON THE SEPARATION DATE.  COMPANY AND EMPLOYEE
SHALL ENTER INTO AMENDMENTS TO THE AGREEMENTS FOR THE VESTED STOCK OPTIONS TO
MEMORIALIZE THE CHANGES DESCRIBED IN THE FOREGOING TWO SENTENCES, BUT THE
CHANGES SHALL BE EFFECTIVE AS OF THE EXPIRATION OF THE MAY 2008 RESCISSION
PERIODS, NOTWITHSTANDING ANY FAILURE TO ENTER INTO ANY SUCH AMENDMENTS.

 

 

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F.             COMPUTER AND CELL PHONE.  COMPANY SHALL ALLOW EMPLOYEE TO RETAIN
THE LAPTOP COMPUTER, CELL PHONE AND CELL PHONE NUMBER ISSUED BY OR THROUGH THE
COMPANY TO EMPLOYEE; HOWEVER, EMPLOYEE SHALL REMOVE OR DESTROY ANY COMPANY
PROPERTY OR INFORMATION IDENTIFIED BY THE COMPANY CONTAINED ON THE LAPTOP
COMPUTER AND CELL PHONE NO LATER THAN THE DATE OF THIS AGREEMENT, TO THE
SATISFACTION OF THE COMPANY.  FOR SUCH PURPOSE, ON THE DATE THIS AGREEMENT IS
SIGNED BY EMPLOYEE, EMPLOYEE SHALL GIVE ACCESS TO COMPANY TO THE LAPTOP COMPUTER
AND CELL PHONE.  CELL PHONE EXPENSES AFTER THE SEPARATION DATE WILL BE THE FULL
RESPONSIBILITY OF EMPLOYEE.

 

G.            ACCRUED BUT UNUSED VACATION TIME.  COMPANY SHALL PAY EMPLOYEE FOR
ALL ACCRUED BUT UNUSED VACATION TIME, THROUGH THE DATE OF THIS AGREEMENT, AN
AMOUNT ESTIMATED TO BE $35,680.00, LESS APPLICABLE FEDERAL AND STATE WITHHOLDING
TAXES AND FICA.  EMPLOYEE SHALL BE ELIGIBLE TO CONTINUE TO MAKE CONTRIBUTIONS TO
EMPLOYEE’S 401(K) PLAN ACCOUNT FROM EMPLOYEE’S COMPENSATION AND PAYMENTS UNDER
THIS AGREEMENT IN ACCORDANCE WITH THE TERMS OF THE PLAN AND APPLICABLE LAW.

 

H.            INDEMNIFICATION OF EMPLOYEE.  EMPLOYEE SHALL RETAIN ALL OF HIS
RIGHTS TO BE INDEMNIFIED, SHALL BE ENTITLED TO ADVANCEMENT OF EXPENSES, AND
SHALL BE HELD HARMLESS BY COMPANY AS AN OFFICER AND DIRECTOR OF THE COMPANY, FOR
ACTS OR OMISSIONS OCCURRING WHILE AN OFFICER, DIRECTOR OR EMPLOYEE OF THE
COMPANY ON OR PRIOR TO THE SEPARATION DATE (THE “INDEMNIFICATION PERIOD”), TO
THE FULLEST EXTENT PERMITTED BY LAW AND THE COMPANY’S ARTICLES OF INCORPORATION
AND BYLAWS, AND ON A BASIS THAT IS NOT LESS FAVORABLE THAN THAT PROVIDED FOR THE
COMPANY’S OTHER OFFICERS AND DIRECTORS, AND SHALL CONTINUE TO BE ELIGIBLE FOR
COVERAGE AND TO BE A NAMED INSURED UNDER THE COMPANY’S CORPORATE DIRECTORS’ AND
OFFICERS’ LIABILITY POLICIES AS IN EFFECT FROM TIME TO TIME WITH RESPECT TO THE
INDEMNIFICATION PERIOD.

 

4.             EMPLOYEE OBLIGATIONS.  AS MATERIAL INDUCEMENT TO COMPANY IN
ENTERING INTO THIS AGREEMENT AND PROVIDING THE CONSIDERATION DESCRIBED IN
SECTION 3, EMPLOYEE HEREBY AGREES AS FOLLOWS:

 

A.            RELEASE.  EMPLOYEE HEREBY RELEASES ALL EMPLOYEE’S CLAIMS. 
EMPLOYEE AGREES TO PROVIDE A “BRING DOWN” RELEASE IN THE FORM ATTACHED HERETO AS
SCHEDULE C AND INCORPORATED HEREIN BY THIS REFERENCE.  THIS BRING-DOWN RELEASE
WILL BE PROVIDED ON THE SEPARATION DATE, EXCEPT IN THE EVENT OF HIS DEATH OR
DISABILITY PRIOR TO THE SEPARATION DATE.  EMPLOYEE ACKNOWLEDGES THAT THE MONEY
AND PROMISES RECEIVED AND TO BE RECEIVED BY EMPLOYEE ARE IN EXCHANGE FOR THE
RELEASES OF EMPLOYEE’S CLAIMS.

 

B.            COVENANT NOT TO SUE.  EMPLOYEE AGREES THAT HE WILL NOT INITIATE
ANY LITIGATION TO PURSUE EMPLOYEE CLAIMS RELEASED UNDER EITHER THE INITIAL
RELEASE OR THE BRING-DOWN RELEASE PROVIDED FOR IN SECTION 4.A.  THIS COVENANT
DOES NOT APPLY TO LITIGATION CHALLENGING THE VALIDITY OF SECTION 4.A.  EXCLUDED
FROM THIS COVENANT ARE ANY CLAIMS WHICH CANNOT BE WAIVED BY LAW, INCLUDING,
WITHOUT LIMITATION, THE RIGHT TO FILE A CHARGE WITH OR PARTICIPATE IN ANY
INVESTIGATION CONDUCTED BY THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION (“EEOC”)
OR ANY STATE OR LOCAL AGENCY.  EMPLOYEE AGREES TO WAIVE, HOWEVER, HIS RIGHT TO
ANY MONETARY RECOVERY SHOULD THE EEOC OR ANY STATE OR LOCAL AGENCY PURSUE ANY
CLAIMS ON EMPLOYEE’S BEHALF.  FURTHER, EMPLOYEE AGREES TO PAY

 

 

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COMPANY’S ATTORNEYS’ FEES IF EMPLOYEE BREACHES THE COVENANT NOT TO SUE CONTAINED
IN THIS SECTION 4.B.

 

C.            NON-COMPETE RESTRICTIONS.  IN EXCHANGE FOR THE COMPANY’S
AGREEMENTS, COVENANTS AND PROMISES SET FORTH IN SECTION 3 OF THIS AGREEMENT,
INCLUDING, WITHOUT LIMITATION, COMPANY’S AGREEMENT TO EXTEND THE EXERCISE PERIOD
OF THE VESTED STOCK OPTIONS, WHICH EMPLOYEE ACKNOWLEDGES ARE ADEQUATE
CONSIDERATION FOR HIS OBLIGATIONS IN THIS SECTION 4.C, EMPLOYEE AGREES THAT
EMPLOYEE SHALL NOT, DIRECTLY OR INDIRECTLY, ON BEHALF OF HIMSELF OR A THIRD
PARTY, FOR A PERIOD OF EIGHTEEN (18) MONTHS FOLLOWING THE SEPARATION DATE
(“RESTRICTED PERIOD”), DO ANY OF THE FOLLOWING:

 

1.             OWN, MANAGE, OPERATE, JOIN, CONTROL, CONSULT WITH, PARTICIPATE IN
THE OWNERSHIP, OPERATION OR CONTROL OF, BE EMPLOYED BY, OR BE CONNECTED IN ANY
MANNER WITH ANY PERSON OR ENTITY WHICH MANUFACTURES, SELLS, SOLICITS, OFFERS,
OFFERS TO PROVIDE, OR PROVIDES ANY COMPETITIVE PRODUCTS AND SERVICES, UNLESS
SUCH EMPLOYMENT IS BY A LARGE DIVERSIFIED ENTITY AND ON A BASIS SUCH THAT
EMPLOYEE WILL HAVE NO INVOLVEMENT WHATSOEVER WITH THE PROVISION OF COMPETITIVE
PRODUCTS AND SERVICES DURING THE RESTRICTED PERIOD.  THIS RESTRICTION APPLIES
WORLDWIDE, AND EMPLOYEE AGREES AND ACKNOWLEDGES A WORLDWIDE RESTRICTION IS
REASONABLE IN SCOPE GIVEN THE COMPANY’S WORLDWIDE TERRITORY;

 

2.             SOLICIT CUSTOMERS OR THE BUSINESS OF ANY PERSON, FIRM,
CORPORATION OR OTHER ENTITY WHO IS OR WHO WAS A CUSTOMER OR ACCOUNT OF COMPANY
OR ANY OF COMPANY’S AFFILIATES AND SUBSIDIARIES WHILE EMPLOYEE WAS EMPLOYED BY
COMPANY, INCLUDING BUT NOT LIMITED TO RESELLERS OR DISTRIBUTORS OF COMPANY
PRODUCTS OR SERVICES, OR ACCEPT BUSINESS FROM ANY PERSON, FIRM, CORPORATION OR
OTHER ENTITY WHO IS OR WHO WAS A CUSTOMER OR ACCOUNT OF COMPANY OR ANY OF
COMPANY’S AFFILIATES AND SUBSIDIARIES WHILE EMPLOYEE WAS EMPLOYED BY COMPANY,
FOR THE PURPOSE OF SELLING TO SUCH CUSTOMER OR ACCOUNT ANY COMPETITIVE PRODUCT
OR SERVICE; AND

 

3.             INDUCE OR SEEK TO INDUCE ANY PERSON EMPLOYED WITH COMPANY OR ITS
AFFILIATES AS OF THE SEPARATION DATE TO DISCONTINUE THAT PERSON’S EMPLOYMENT
WITH COMPANY AND/OR SOLICIT, RECRUIT, HIRE OR PARTICIPATE IN ANY OTHER PERSON’S
OR ENTITY’S EFFORT TO HIRE AN EMPLOYEE OF COMPANY.

 

D.            COMPANY PROPERTY.  UNLESS OTHERWISE SET FORTH HEREIN, EMPLOYEE
WILL RETURN TO COMPANY ALL PROPERTY BELONGING TO COMPANY IMMEDIATELY UPON THE
EXECUTION OF THIS AGREEMENT, WHETHER SUCH PROPERTY IS CURRENTLY ON OR OFF THE
PREMISES OF COMPANY, INCLUDING, WITHOUT LIMITATION, ANY AND ALL COMPUTER
HARDWARE OR COMPUTER SOFTWARE.

 

E.             CONFIDENTIALITY.  FOR ALL TIME HEREAFTER FOREVER, EMPLOYEE WILL
NOT USE OR MAKE AVAILABLE OR DIVULGE TO ANY PERSON, FIRM, CORPORATION OR OTHER
ENTITY ANY INFORMATION OF OR REGARDING COMPANY INCLUDING, WITHOUT LIMITATION,
TRADE SECRETS, CUSTOMER LISTS, BUSINESS POLICIES, FINANCIAL INFORMATION,
TECHNICAL INFORMATION, EMPLOYEE INFORMATION, METHODS OF OPERATION, MARKETING
PROGRAMS, CUSTOMER PRICE LISTS OR ANY OTHER CONFIDENTIAL OR SECRET INFORMATION
CONCERNING THE BUSINESS AND AFFAIRS OF COMPANY OR ANY OF ITS AFFILIATES, EXCEPT
TO THE EXTENT (I) SUCH INFORMATION IS IN THE PUBLIC DOMAIN WITHOUT FAULT OF

 

 

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EMPLOYEE OR (II) EMPLOYEE IS REQUIRED TO RESPOND TO A LAWFUL AND VALID SUBPOENA
OR OTHER LEGAL PROCESS OR OTHER GOVERNMENT OR REGULATORY INQUIRY, IN WHICH CASE
HE SHALL GIVE COMPANY PROMPT NOTICE THEREOF (EXCEPT TO THE EXTENT LEGALLY
PROHIBITED).

 

F.             CONFIDENTIALITY OF AGREEMENT.  UNTIL SUCH TIME AS THE TERMS OF
THIS AGREEMENT HAVE BEEN PUBLICLY DISCLOSED BY COMPANY, EMPLOYEE AGREES THAT HE
WILL KEEP THE TERMS AND CONDITIONS OF THIS AGREEMENT THAT HAVE NOT BEEN SO
DISCLOSED STRICTLY CONFIDENTIAL EXCEPT THAT EMPLOYEE MAY DISCLOSE THE TERMS AND
CONDITIONS OF THIS AGREEMENT TO HIS SPOUSE, IF ANY, ATTORNEY, TAX PREPARER,
GOVERNMENT AGENCIES OR AS REQUIRED BY LAW.

 

G.            NON-DISPARAGEMENT.  FOR ALL TIME HEREAFTER FOREVER, EMPLOYEE
AGREES THAT HE SHALL NOT DISPARAGE OR DEFAME COMPANY OR ITS EMPLOYEES OR
DIRECTORS IN ANY RESPECT.

 

H.            COOPERATION AND CONTINUING ASSISTANCE FROM EMPLOYEE.  EMPLOYEE
AGREES TO COOPERATE WITH REASONABLE REQUESTS BY THE COMPANY THROUGH THE
EXPIRATION OF HIS SERVICE ON THE BOARD OF DIRECTORS OF THE COMPANY TO PROVIDE
INFORMATION OR ASSIST COMPANY WITH THE TRANSITION OF EMPLOYEE’S JOB DUTIES TO
OTHER COMPANY EMPLOYEES, WHICH SHALL BE AT COMPANY’S EXPENSE.

 

I.              MEMBER OF BOARD OF DIRECTORS.  EMPLOYEE WILL CONTINUE TO SERVE
ON COMPANY’S BOARD OF DIRECTORS UNTIL THE EARLIER OF (I) THE SHAREHOLDERS’
MEETING OF COMPANY WHICH IS CURRENTLY SCHEDULED TO BE HELD IN MAY 2008
(“SHAREHOLDERS’ MEETING”) OR MAY 15, 2008.  EMPLOYEE SHALL NOT BE ENTITLED TO
COMPENSATION FOR HIS SERVICE ON THE BOARD OF DIRECTORS, AND EMPLOYEE WILL NOT BE
ELIGIBLE FOR RE-ELECTION TO THE BOARD OF DIRECTORS AFTER THE DATE OF THE
SHAREHOLDERS’ MEETING.

 

J.             REMEDIES.  EMPLOYEE ACKNOWLEDGES THAT ANY BREACH OF ANY OF HIS
AGREEMENTS, COVENANTS AND PROMISES SET FORTH IN SECTIONS 4.C., 4.D., 4.E., 4.F.,
4.G., 4.H., AND 4.I. WILL CAUSE COMPANY IRREPARABLE HARM FOR WHICH THERE IS NO
ADEQUATE REMEDY AT LAW, AND EMPLOYEE THEREFORE CONSENTS TO THE ISSUANCE OF AN
INJUNCTION IN FAVOR OF COMPANY ENJOINING THE BREACH OF ANY OF THOSE AGREEMENTS,
COVENANTS AND PROMISES BY ANY COURT OF COMPETENT JURISDICTION.  IF ANY
AGREEMENT, COVENANT OR PROMISE MADE BY EMPLOYEE IN THIS SECTION 4 SHOULD BE HELD
TO BE UNENFORCEABLE BECAUSE OF ITS SCOPE OR DURATION, OR THE AREA OR SUBJECT
MATTER COVERED THEREBY, EMPLOYEE AGREES THAT THE COURT MAKING SUCH DETERMINATION
SHALL HAVE THE POWER TO REDUCE OR MODIFY THE SCOPE, DURATION, SUBJECT MATTER OR
AREA OF THAT AGREEMENT, COVENANT OR PROMISE TO THE EXTENT THAT ALLOWS THE
MAXIMUM SCOPE, DURATION, SUBJECT MATTER OR AREA PERMITTED BY APPLICABLE LAW. 
EMPLOYEE FURTHER AGREES THAT THE REMEDIES PROVIDED FOR HEREIN ARE IN ADDITION
TO, AND ARE NOT TO BE CONSTRUED AS REPLACEMENTS FOR, OR A LIMITATION OF, RIGHTS
AND REMEDIES OTHERWISE AVAILABLE TO COMPANY.

 

5.             EMPLOYEE’S UNDERSTANDINGS.  EMPLOYEE ACKNOWLEDGES AND REPRESENTS
THAT:

 

A.            EMPLOYEE HAS THE RIGHT TO CONSULT WITH AN ATTORNEY REGARDING THE
MEANING AND EFFECT OF THIS AGREEMENT.

 

B.            EMPLOYEE HAS A PERIOD OF TWENTY-ONE (21) CALENDAR DAYS FROM THE
DATE ON WHICH HE RECEIVES AN UNSIGNED COPY OF THIS AGREEMENT DURING WHICH TO
CONSIDER WHETHER OR NOT

 

 

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TO SIGN THIS AGREEMENT AND THAT, HAVING BEEN ADVISED OF THAT ENTITLEMENT, HE MAY
ELECT TO SIGN THIS AGREEMENT AT ANY TIME PRIOR TO THE EXPIRATION OF THAT
TWENTY-ONE (21) DAY PERIOD.  EMPLOYEE ACKNOWLEDGES THAT HE RECEIVED A COPY OF
THIS AGREEMENT ON JANUARY 6, 2008 AND THAT ANY REVISIONS TO THIS AGREEMENT AFTER
JANUARY 6, 2008 WILL NOT EXTEND OR ALTER SUCH TWENTY-ONE (21) DAY PERIOD FOR
EMPLOYEE TO CONSIDER WHETHER TO SIGN THE AGREEMENT.

 

C.            EMPLOYEE MAY RESCIND (THAT IS, CANCEL), WITHIN SEVEN (7) CALENDAR
DAYS OF SIGNING THE AGREEMENT, THE PROVISIONS OF SECTION 4.A. OF THIS AGREEMENT
WITH RESPECT TO CLAIMS ARISING UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT
(“ADEA RESCISSION PERIOD”) AND MAY RESCIND WITHIN FIFTEEN (15) CALENDAR DAYS OF
SIGNING THE AGREEMENT, THE PROVISIONS OF SECTION 4.A. OF THIS AGREEMENT WITH
RESPECT TO CLAIMS ARISING UNDER THE MINNESOTA HUMAN RIGHTS ACT (“MHRA RESCISSION
PERIOD”) (COLLECTIVELY, “RESCISSION PERIODS”).  TO BE EFFECTIVE, RESCISSION MUST
BE IN WRITING, DELIVERED TO COMPANY AT VITAL IMAGES, INC., 5850 OPUS PARKWAY,
SUITE 300, MINNETONKA, MN   55343, ATTN:  VICE PRESIDENT, HUMAN RESOURCES,
WITHIN THE APPLICABLE RESCISSION PERIOD, OR SENT TO COMPANY, AT SUCH ADDRESS, BY
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, POSTMARKED WITHIN THE APPLICABLE
RESCISSION PERIOD.

 

6.             CANCELLATION OF AGREEMENT BY COMPANY.  IF EMPLOYEE EXERCISES HIS
RIGHT OF RESCISSION UNDER SECTION 5.C. OF THIS AGREEMENT, COMPANY WILL HAVE THE
RIGHT, EXERCISABLE BY WRITTEN NOTICE DELIVERED TO EMPLOYEE, TO TERMINATE THIS
AGREEMENT IN ITS ENTIRETY, IN WHICH EVENT COMPANY WILL HAVE NO OBLIGATION
WHATSOEVER TO EMPLOYEE HEREUNDER.  IF EMPLOYEE EXERCISES HIS RIGHT OF RESCISSION
UNDER SECTION 5.C. OF THIS AGREEMENT, AND COMPANY DOES NOT EXERCISE ITS RIGHT TO
TERMINATE THIS AGREEMENT HEREUNDER, THE REMAINING PROVISIONS OF THIS AGREEMENT
(INCLUDING, SPECIFICALLY, THE REMAINING PROVISIONS OF SECTION 4 OF THIS
AGREEMENT) SHALL REMAIN VALID AND CONTINUE IN FULL FORCE AND EFFECT.

 

7.             PERFORMANCE.  NOTHING CONTAINED HEREIN SHALL OPERATE AS A WAIVER
OR AN ELECTION OF REMEDIES BY COMPANY OR BY EMPLOYEE SHOULD EMPLOYEE OR COMPANY
FAIL TO PERFORM ANY DUTY OR OBLIGATION IMPOSED UPON THE OTHER HEREUNDER. 
NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, THIS AGREEMENT AND
THE DUTIES AND OBLIGATIONS OF EMPLOYEE AND COMPANY HEREUNDER SHALL CONTINUE IN
FULL FORCE AND EFFECT IRRESPECTIVE OF ANY VIOLATION OF ANY TERM OR PROVISION OF
THIS AGREEMENT BY EMPLOYEE OR COMPANY.

 

8.             NO ADMISSION OF LIABILITY.  THE PARTIES AGREE THAT THIS AGREEMENT
SHALL NOT BE CONSIDERED AN ADMISSION OF LIABILITY BY COMPANY.  COMPANY EXPRESSLY
DENIES THAT IT IS IN ANY WAY LIABLE TO EMPLOYEE OR THAT IT HAS ENGAGED IN ANY
WRONGDOING WITH RESPECT TO EMPLOYEE.

 

9.             ANNOUNCEMENTS.  EMPLOYEE SHALL BE ENTITLED TO REASONABLE INPUT
REGARDING INTERNAL AND EXTERNAL ANNOUNCEMENTS REGARDING THE SUBJECT MATTER OF
THIS AGREEMENT.

 

10.           EMPLOYEE ACKNOWLEDGEMENTS.  EMPLOYEE ACKNOWLEDGES AND REPRESENTS
THAT THIS AGREEMENT MEMORIALIZES THE TERMS AND CONDITIONS AGREED TO BY AND
BETWEEN COMPANY AND EMPLOYEE ON DECEMBER 31, 2007.  EMPLOYEE FURTHER
ACKNOWLEDGES AND REPRESENTS THAT:  (A) HE HAS READ THIS AGREEMENT AND
UNDERSTANDS ITS CONSEQUENCES; (B) HE HAS RECEIVED ADEQUATE OPPORTUNITY TO READ
AND CONSIDER THIS AGREEMENT; (C) HE HAS DETERMINED TO EXECUTE THIS AGREEMENT OF
HIS OWN FREE WILL AND ACKNOWLEDGES THAT HE HAS NOT RELIED UPON ANY STATEMENTS OR

 

 

7

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EXPLANATIONS MADE BY COMPANY REGARDING THIS AGREEMENT; (D) THE PROMISES OF
COMPANY MADE IN THIS AGREEMENT CONSTITUTE FAIR AND ADEQUATE CONSIDERATION FOR
THE PROMISES, RELEASES AND AGREEMENTS MADE BY EMPLOYEE IN THIS AGREEMENT;
(E) THE VESTED STOCK OPTIONS WHICH ARE “INCENTIVE STOCK OPTIONS,” AS THAT TERM
IS USED IN SECTION 422 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, WHICH
ARE BEING EXTENDED AS PROVIDED IN SECTION 3.E. WILL BECOME NONQUALIFIED STOCK
OPTIONS THAT ARE NOT INCENTIVE STOCK OPTIONS; AND (F) COMPANY WILL BE REQUIRED
TO DISCLOSE THE TERMS OF THIS AGREEMENT IN A CURRENT REPORT ON FORM 8-K TO BE
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (“SEC”) AND TO FILE A COPY OF
THIS AGREEMENT WITH THE SEC.

 

11.           ENTIRE AGREEMENT.  UNLESS OTHERWISE SET FORTH HEREIN, THIS
AGREEMENT, INCLUDING ANY SCHEDULES ATTACHED HERETO OR DOCUMENTS EXPRESSLY
REFERRED TO HEREIN CONTAINS THE ENTIRE AGREEMENT BETWEEN COMPANY AND EMPLOYEE
AND, EXCEPT AS EXPRESSLY SET FORTH HEREIN, SUPERSEDES AND CANCELS ANY AND ALL
OTHER AGREEMENTS, ARRANGEMENTS AND UNDERSTANDINGS, WHETHER ORAL OR IN WRITING,
BETWEEN COMPANY AND EMPLOYEE WITH RESPECT TO THE TERMS AND CONDITIONS OF HIS
EMPLOYMENT WITH COMPANY AND THE TERMINATION OF HIS EMPLOYMENT.  THIS AGREEMENT
DOES NOT SUPERSEDE, CANCEL OR OTHERWISE VOID SECTION 3.5 OF THE
EMPLOYMENT AGREEMENT ENTITLED “WORKS MADE FOR HIRE,” WHICH SHALL REMAIN IN FULL
FORCE AND EFFECT.

 

12.           TERMINATION CLAUSE.  EXCEPT AS PROVIDED IN SECTION 11 OF THIS
AGREEMENT, THE EMPLOYMENT AGREEMENT AND CHANGE IN CONTROL AGREEMENT TERMINATE
EFFECTIVE THE SEPARATION DATE.

 

13.           MITIGATION.  EMPLOYEE SHALL NOT BE REQUIRED TO MITIGATE THE AMOUNT
OF ANY PAYMENTS OR BENEFITS COMPANY IS REQUIRED TO MAKE OR PROVIDE IN CONNECTION
WITH THIS AGREEMENT BY SEEKING OTHER EMPLOYMENT OR OTHERWISE.

 

14.           GOVERNING LAW.  THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF MINNESOTA.  ALL ACTIONS REGARDING THIS
AGREEMENT SHALL BE BROUGHT IN A STATE OR FEDERAL COURT WITHIN THE STATE OF
MINNESOTA.

 

15.           EFFECTIVE DATE.  THIS AGREEMENT WAS ORIGINALLY OFFERED TO EMPLOYEE
ON OR ABOUT JANUARY 6, 2008.  EMPLOYEE SHALL HAVE UNTIL THE CLOSE OF BUSINESS ON
JANUARY 27, 2008 TO ACCEPT THIS AGREEMENT.  IF EMPLOYEE DESIRES TO ACCEPT THIS
AGREEMENT, EMPLOYEE SHALL EXECUTE THE AGREEMENT AND RETURN THE SAME TO COMPANY
AT THE ADDRESS SET FORTH IN SECTION 5.C. HEREOF.  IF EMPLOYEE DOES NOT SO ACCEPT
THIS AGREEMENT, THIS AGREEMENT, AND THE OFFER CONTAINED HEREIN, SHALL BE NULL
AND VOID AS OF THE CLOSE OF BUSINESS ON JANUARY 27, 2008.

 

 

8

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16.           COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN COUNTERPARTS WITH
AN EXECUTED COUNTERPART TO BE DELIVERED TO THE OTHER PARTY.  EACH SUCH EXECUTED
COUNTERPART SHALL BE DEEMED AN ORIGINAL BUT SHALL CONSTITUTE ONE AND THE SAME
INSTRUMENT.

 

 

VITAL IMAGES, INC.

 

 

 

Dated:1-17-08

By:

/s/ Peter J. Goepfrich

 

Its:

Chief Financial Officer

 

 

 

 

Dated:1-17-08

/s/ Jay D. Miller

 

Jay D. Miller

 

 

9

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Schedule A

 

Vested Stock Options for Jay D. Miller

 

Option
No.

 

Type*

 

Grant
Date

 

Per Share
Exercise
Price

 

Last Exercise
Date

 

Number of Shares
Subject to Vested
Portion of Option at
May 15, 2008

435

 

ISO

 

05/11/2000

 

$7.3438

 

05/11/2008

 

8,659

**

436

 

NQ

 

05/11/2000

 

$7.3438

 

05/11/2008

 

4,841

**

604

 

ISO

 

02/08/2001

 

$5.1880

 

02/08/2009

 

11,574

 

605

 

NQ

 

02/08/2001

 

$5.1880

 

02/08/2009

 

5,926

 

707

 

ISO

 

03/12/2002

 

$7.2500

 

03/12/2010

 

35,000

 

708

 

NQ

 

03/12/2002

 

$7.2500

 

03/12/2010

 

165,000

 

741

 

ISO

 

02/06/2003

 

$9.6000

 

02/06/2011

 

4,572

 

742

 

NQ

 

02/06/2003

 

$9.6000

 

02/06/2011

 

25,428

 

895

 

ISO

 

02/05/2004

 

$12.5990

 

05/15/2011

 

8,224

 

896

 

NQ

 

02/05/2004

 

$12.5990

 

05/15/2011

 

21,776

 

1126

 

NQ

 

02/15/2005

 

$15.4000

 

05/15/2011

 

8,200

 

1553

 

NQ

 

03/09/2006

 

$32.1400

 

05/15/2011

 

14,000

 

1792

 

NQ

 

02/02/2007

 

$32.6400

 

05/15/2011

 

8,840

 

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* “ISO” means an “incentive stock option,” as that term is used in the Internal
Revenue Code of 1986, as amended.  “NQ” means an option that is not an incentive
stock option.

 

** Options 435 and 436 are not being extended in connection with this Agreement
and, unless exercised prior thereto, will expire on May 11, 2008.

 

 

 

A-1

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Schedule B

 

Company’s “Bring-down” Release

 

This Bring-down Release Agreement is entered into as of                   , 2008
by Vital Images, Inc. (“Company”), a Minnesota corporation.

 

1.             Definitions.  We intend all words used in this Bring-down Release
to have their plain meanings in ordinary English.  Specific terms we use in this
Bring-down Release have the following meanings:

 

A.           Employee, as used herein, shall mean Jay D. Miller and anyone who
has obtained any legal rights or claims through the undersigned Employee.

 

B.            Company, as used herein, shall at all times mean Vital
Images, Inc., its parent company, its subsidiaries, successors and assigns,
their affiliated and predecessor companies, their successors and assigns, their
affiliated and predecessor companies and the present or former directors,
officers, employees, representatives and agents (including, without limitation,
their accountants and attorneys) of any of them, whether in their individual or
official capacities, and the current and former trustees or administrators of
any pension or other benefit plan applicable to employees or former employees of
Company, in their official or individual capacities.

 

C.            Company’s Claims, as used herein, means all of the rights Company
now has to any relief of any kind from Employee, or from his heirs,
beneficiaries, successors or assigns, whether or not Company now knows about
those rights, arising out of Employee’s employment with Company on or prior to
the date of this Bring-down Release, including, but not limited to, claims for
breach of contract; fraud or misrepresentation; defamation, intentional or
negligent infliction of emotional distress; breach of covenant of good faith and
fair dealing, promissory estoppel; negligence or under applicable federal, state
or local law.

 

2.             Company Obligations.  As material inducement to Employee in
entering into that certain Separation and Non-Compete Agreement dated
January 16, 2008 between the Company and Employee (the “Separation Agreement”),
and specifically in consideration for the releases of claims, as set forth in
more detail in the Separation Agreement, Company hereby agrees as follows:

 

A.           Release.  Effective as of the expiration of Employee’s May 2008
Rescission Periods, as defined in the Separation Agreement, without rescission
of Employee’s bring-down release, Company hereby releases all Company’s Claims,
provided, however, that such release is not intended to apply to any willful
misconduct by Employee of which Company does not have present knowledge.

 

3.             Cancellation of Bring-down Release By Company.  If Employee
exercises his right of rescission under Section 3.C. of the Employee Bring-down
Release, Company will have the right, exercisable by written notice delivered to
Employee, to terminate this Bring-down Release

 

 

B-1

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in its entirety, in which event Company will have no obligation whatsoever to
Employee hereunder.  If Employee exercises his right of rescission under
Section 3.C. of the Employee Bring-down Release, and Company does not exercise
its right to terminate this Bring-down Release hereunder, the remaining
provisions of this Bring-down Release (including, specifically, the remaining
provisions of Section 2 of this Bring-down Release) shall remain valid and
continue in full force and effect.

 

4.             Governing Law.  This Bring-down Release shall be construed and
enforced in accordance with the laws of the State of Minnesota.  All actions
regarding this Bring-down Release shall be brought in a state or federal court
within the State of Minnesota.

 

5.             Effective Date.  This Bring-down Release shall be effective upon
the date set forth below.

 

 

VITAL IMAGES, INC.

 

 

 

 

 

Dated:

 

 

By:

 

 

 

Its:

 

 

 

 

2

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Schedule C

 

Employee’s “Bring-down” Release

 

This Bring-down Release Agreement is entered into as of                   , 2008
by Jay D. Miller, a resident of the State of Minnesota (“Employee”).

 

1.             Definitions.  We intend all words used in this Bring-down Release
to have their plain meanings in ordinary English.  Specific terms we use in this
Bring-down Release have the following meanings:

 

A.            Employee, as used herein, shall include the undersigned Employee
and anyone who has obtained any legal rights or claims through the undersigned
Employee.

 

B.            Company, as used herein, shall at all times mean Vital
Images, Inc., its parent company, its subsidiaries, successors and assigns,
their affiliated and predecessor companies, their successors and assigns, their
affiliated and predecessor companies and the present or former directors,
officers, employees, representatives and agents (including, without limitation,
their accountants and attorneys) of any of them, whether in their individual or
official capacities, and the current and former trustees or administrators of
any pension or other benefit plan applicable to employees or former employees of
Company, in their official or individual capacities.

 

C.            Employee’s Claims, as used herein, means all of the rights
Employee, has on or prior to the date hereof, to any relief of any kind from
Company, whether or not Employee now knows about those rights, arising out of
his employment with Company, and his employment termination, including, but not
limited to, claims arising under the Age Discrimination in Employment Act, as
amended by the Older Workers Benefit Protection Act; the Minnesota Human Rights
Act; the Americans with Disabilities Act; Title VII of the Civil Rights Act of
1964, as amended; the Minnesota Whistleblower Act; or other federal, state or
local civil rights laws; claims pursuant to that certain Employment Agreement
between Company and Employee dated February 9, 2002 (the “Employment
Agreement”); claims pursuant to that certain Amended and Restated Change in
Control Agreement dated February 9, 2002 (the “Change in Control Agreement”);
claims pursuant to any other agreement, understanding, plan or arrangement under
which Employee could receive compensation from the Company, as the parties
intend for the Separation and Non-Compete Agreement dated January 16, 2008
between Company and Employee (“Separation Agreement”) pursuant to which this
Bring-down Release is being delivered, to settle all obligations remaining
between the parties; claims for breach of contract; fraud or misrepresentation;
defamation, intentional or negligent infliction of emotional distress; breach of
covenant of good faith and fair dealing; promissory estoppel; negligence;
wrongful termination of employment; and any other claims for unlawful employment
practices arising on or prior to the date hereof; provided, however, that the
term “Employee’s Claims” shall in no event include Employee’s rights to receive
the payments, benefits and continuing protections required to be provided under
the Separation Agreement, including, without limitation,

 

 

C-1

--------------------------------------------------------------------------------

 

Employee’s rights to receive reimbursement of his expenses, in accordance with
Company policies, benefits under Company’s life insurance and 401(k) plans and
similar fringe benefit programs for which Employee was eligible as of the
Separation Date, as defined in the Separation Agreement, and under laws related
thereto.

 

2.             Employee Obligations.  As material inducement to Company in
entering into the Separation Agreement, and specifically in consideration for
the payments and benefits, as set forth in more detail in the Separation
Agreement, Employee hereby agrees as follows:

 

A.            Release.  Employee agrees to release all Employee’s Claims. 
Employee acknowledges that the money and promises received and to be received by
Employee are in exchange for the release of Employee’s Claims.

 

B.            Covenant Not To Sue.  Employee agrees that he will not initiate
any litigation to pursue claims which Employee released in Section 2.A.  This
covenant does not apply to litigation challenging the validity of Section 2.A. 
Excluded from this covenant are any claims which cannot be waived by law,
including, without limitation, the right to file a charge with or participate in
any investigation conducted by the Equal Employment Opportunity Commission
(“EEOC”) or any state or local agency.  Employee agrees to waive, however, his
right to any monetary recovery should the EEOC or any state or local agency
pursue any claims on Employee’s behalf.  Further, Employee agrees to pay
Company’s attorneys’ fees if Employee breaches the covenant not to sue contained
in this Section 2.B.

 

3.             Employee’s Understandings.  Employee acknowledges and represents
that:

 

A.            EMPLOYEE HAS THE RIGHT TO CONSULT WITH AN ATTORNEY REGARDING THE
MEANING AND EFFECT OF THIS BRING-DOWN RELEASE.

 

B.            EMPLOYEE ACKNOWLEDGES THAT HE WAS OFFERED A PERIOD OF TWENTY-ONE
(21) CALENDAR DAYS FROM THE DATE ON WHICH HE RECEIVES AN UNSIGNED COPY OF THIS
BRING-DOWN RELEASE IN WHICH TO CONSIDER WHETHER OR NOT TO SIGN THIS BRING-DOWN
RELEASE AND THAT, HAVING BEEN ADVISED OF THAT ENTITLEMENT, SUCH PERIOD HAS
EXPIRED.

 

C.            EMPLOYEE MAY RESCIND (THAT IS, CANCEL) WITHIN SEVEN (7) CALENDAR
DAYS OF SIGNING THE BRING-DOWN RELEASE, THE PROVISIONS OF SECTION 2.A. OF THIS
BRING-DOWN RELEASE WITH RESPECT TO CLAIMS ARISING UNDER THE AGE DISCRIMINATION
IN EMPLOYMENT ACT (“ADEA RESCISSION PERIOD”) AND THAT HE MAY RESCIND WITHIN
FIFTEEN (15) CALENDAR DAYS OF SIGNING THE BRING-DOWN RELEASE THE PROVISIONS OF
SECTION 2.A. OF THIS BRING-DOWN RELEASE WITH RESPECT TO CLAIMS ARISING UNDER THE
MINNESOTA HUMAN RIGHTS ACT (“MHRA RESCISSION PERIOD”) (COLLECTIVELY, “RESCISSION
PERIODS”).  TO BE EFFECTIVE, RESCISSION MUST BE IN WRITING, DELIVERED TO COMPANY
AT 5850 OPUS PARKWAY, SUITE 300, MINNETONKA, MN  55343, ATTN:  VICE PRESIDENT,
HUMAN RESOURCES, WITHIN THE APPLICABLE RESCISSION PERIOD, OR SENT TO COMPANY, AT
SUCH ADDRESS, BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, POSTMARKED WITHIN THE
APPLICABLE RESCISSION PERIOD.

 

4.             Cancellation of Bring-down Release By Company.  If Employee
exercises his right of rescission under Section 3.C. of this Bring-down Release,
Company’s Bring-down Release shall

 

 

2

--------------------------------------------------------------------------------

 

be null and void in its entirety without further notice to Employee.  This shall
not limit any other rights or remedies available to Company by law.

 

5.             Employee Acknowledgements.  Employee acknowledges and represents
that:  (a) he has read this Bring-down Release and understands its consequences;
(b) he has received adequate opportunity to read and consider this Bring-down
Release; (c) he has determined to execute this Bring-down Release of his own
free will and acknowledges that he has not relied upon any statements or
explanations made by Company regarding this Bring-down Release; and (d) the
promises of Company made in the Company’s Bring-down Release constitute fair and
adequate consideration for the promises, releases and agreements made by
Employee in this Bring-down Release.

 

6.             Governing Law.  This Bring-down Release shall be construed and
enforced in accordance with the laws of the State of Minnesota.  All actions
regarding this Bring-down Release shall be brought in a state or federal court
within the State of Minnesota.

 

7.             Effective Date.  This Bring-down Release shall be effective upon
the date set forth below.

 

Dated:

 

 

 

 

 

 

Jay D. Miller

 

 

3

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