Exhibit 10.2
 

 
SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT
 
THIS SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is
entered into as of the 11th day of March, 2019 by and between Atrion
Corporation, a Delaware corporation (the “Company”), and Emile A Battat (the
“Executive”).
 

W I T N E S S E T H:
 
WHEREAS, the Executive and the Company are currently parties to an employment
agreement dated as of the 7th day of August, 2006, as amended (the “Current
Employment Agreement”), pursuant to which the Executive is employed by the
Company as the Chairman of the Board of Directors of the Company (the “Board”);
and
 
WHEREAS, the Company and the Executive desire to amend and restate the Current
Employment Agreement as set forth in this Agreement.
 
NOW, THEREFORE, in consideration of the foregoing, the mutual provisions
contained herein, and for other good and valuable consideration, the parties
hereto agree as follows:
 
1.             EMPLOYMENT.
 
(a)             Continuation of Employment. The Company hereby agrees to
continue to employ the Executive, and the Executive hereby accepts continued
employment by the Company until expiration of the Employment Term (as defined
below). The Executive is and will continue to be a senior executive officer of
the Company and, subject to his election as a director by the stockholders and
his election by the Board as its Chairman of the Board ("Chairman"), the
Executive shall serve as Chairman on the terms and conditions hereinafter set
forth. The Executive shall perform such duties, and have such powers, authority,
functions and responsibilities (commensurate with his position and title) as may
be reasonably assigned to him from time to time by the Board which are not
(except with the Executive's prior written consent) inconsistent with, and which
do not interfere with or detract from, those vested in or being performed by the
Executive for the Company.
 
(b)             Duties. During the remainder of the Employment Term, the
Executive shall be a full time employee of the Company; provided, however that
the Executive shall be allowed, to the extent that such activities do not
materially interfere with the performance of his duties and responsibilities
hereunder, to manage his personal financial affairs and to serve on corporate,
civic, not-for-profit, charitable and industry boards and advisory committees.
In addition to such duties as may be assigned to him by the Board, consistent
with the provisions of Section 1(a) above, the Executive shall provide guidance
to the Company's Chief Executive Officer, consult and advise on, and assist with
the evaluation, planning and implementation of, corporate strategy and
operational matters as requested by the Chief Executive Officer, provide
leadership to the Board and preside over meetings of the Company's stockholders
and Board.
 

 
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2.             TERM. The current term of the Executive's employment began on
January 1, 2017 and shall continue until December 31, 2021(the "Current Term").
The term of the Executive's employment under this Agreement shall be
automatically renewed for additional one (1) year terms (each referred to as an
“Additional Term”) at the end of the Current Term and at the end of each
Additional Term, as the case may be, unless either party delivers written notice
of termination to the other at least six (6) months prior to the end of the
Current Term or Additional Term, as the case may be. The Current Term and the
Additional Terms together constitute the “Employment Term.”
 
3.             COMPENSATION. The Company shall pay the Executive the following,
subject to withholding and other applicable employment taxes:
 
(a)             Base Salary. The Company shall pay the Executive a base salary
(the "Base Salary") of Six Hundred Thousand and No/100 Dollars ($600,000.00) for
each calendar year in the Current Term.
 
(b)             Bonuses. In addition to the Base Salary, the Company shall pay
the Executive a cash bonus (the “Annual Bonus”) for each calendar year in the
Employment Term equal to the amount that is 8% of the Increase in Operating
Income for such calendar year. For purposes of this Agreement, “Increase in
Operating Income” shall be equal to the excess, if any, of the Company’s
operating income for the calendar year of determination over the Company’s
operating income for the previous calendar year. The Compensation Committee of
the Board shall have discretion to adjust the Increase in Operating Income
calculated pursuant to the previous sentence to disregard one-time,
non-recurring extraordinary adjustments and shall make such equitable
adjustments as are required to give effect to acquisitions, divestitures, or
similar corporate transactions by or involving the Company.
 
The Base Salary shall be payable in intervals consistent with the Company's
normal payroll schedules (but in no event less frequently than monthly). The
Base Salary, as in effect from time to time, may be increased but not reduced
without the written consent of the Executive. The Annual Bonus for each calendar
year in the Employment Term shall be payable as soon as practicable following
the date on which the Annual Bonus can be determined, but in no event later than
March 15 of the year following such calendar year.
 
In addition to the Base Salary and the Annual Bonus, the Company shall pay the
Executive such other incentive compensation as the Company may from time to time
determine.
 
(c)             Benefits and Expenses. The Executive shall have the right to
participate in the employee benefit plans, equity and incentive plans, insurance
contracts, policies, arrangements or agreements maintained by the Company for
the benefit of its employees and relating to retirement, health, disability and
other employee benefits, subject to the Executive's qualification for
participation in such benefit plans pursuant to the terms and conditions under
which such benefit plans are offered, at a level commensurate with the
Executive's position. The Executive's rights and entitlements with respect to
any such benefits shall be subject to the provisions of the relevant agreements,
contracts, policies, arrangements or plans providing such benefits. Nothing
contained herein shall be deemed to impose any obligation on the Company to
adopt or maintain any such plans, policies, arrangements, contracts or
agreements. In accordance with its policies and procedures, the Company shall
pay or reimburse the Executive for all reasonable or necessary travel and other
out-of-pocket expenses incurred by the Executive in performing his obligations
under this Agreement. The Executive shall comply with all such policies and
procedures applicable to the Company's senior executive employees relating to
the nature and extent of reimbursable expenses, the manner of accounting
therefor and the manner or reimbursement of same. The Company shall also furnish
the Executive with such office and clerical assistance as shall be suitable to
the character of the Executive's position with the Company and adequate for the
performance of his duties hereunder.
 

 
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(d)             Vacation and Holidays. The Executive shall be entitled to such
vacation and holidays with pay during each fiscal year of the Company as the
Company makes available to its other salaried employees, such vacation to be
taken at such time or times as shall be approved by the Company, which approval
shall not be unreasonably withheld. Unless otherwise agreed between the parties,
unused days of vacation and unused holidays may not be carried over from one
fiscal year of the Company to another.
 
4.             TERMINATION.
 
(a)             Termination by the Company. The Company may terminate the
employment of the Executive prior to the expiration of the Employment Term (i)
for “just cause” (as defined below) by delivering written notice of termination
to the Executive or (ii) without “just cause” upon thirty (30) days written
notice of termination to the Executive.
 
(b)             Termination by Executive. The Executive may terminate his
employment under this Agreement prior to the expiration of the Employment Term
(i) for “good reason” (as defined below) by giving the Company ninety (90) days
written notice of his intention to terminate such employment or (ii) without
“good reason” by giving the Company ninety (90) days written notice of his
intention to terminate such employment.
 
(c)             Termination Upon Retirement, Death, or Disability. The
Executive's employment shall terminate immediately upon his Retirement (as
defined below) or his death. In the event that the Executive becomes subject to
a Disability (as defined below), the Executive's employment may be terminated
upon thirty (30) days written notice by either party to the other.
 
(d)             Definitions. For purposes of this Agreement, the following terms
shall have the respective meanings indicated below:
 
(i)             Just Cause. The term “just cause” shall mean (A) the Executive's
continuing willful failure to perform his material duties and obligations under
this Agreement (except by reason of his death or incapacity due to his
Disability) after written notice thereof by the Company to the Executive, and
the Executive's failure or refusal to perform such duties and obligations within
thirty (30) days after the receipt of such notice by the Executive or (B) the
conviction of, or the entering of a plea of nolo contendere by, the Executive
with respect to a felony (other than as a result of a traffic violation or as a
result of vicarious liability), provided that on or after a Change in Control
(as defined in Exhibit A hereto), “just cause” shall be limited to only
subsection (B) above. For purposes of this Section 4(d)(i), no act, or failure
to act, on the Executive's part shall be considered “willful” unless done, or
omitted to be done, by him not in good faith and without reasonable belief that
his action or omission was in the best interests of the Company. The Company
must assert a “just cause” termination event no later than ninety (90) days
after discovery of such event.
 
The date of termination for a termination for “just cause” shall be the date
indicated in the Notice of Termination (as defined herein). A “Notice of
Termination” for “just cause” shall mean a notice that shall indicate the
specific termination provision in Section 4(d)(i) relied upon and shall set
forth in reasonable detail the facts and circumstances which provide for a basis
for termination for “just cause.” Further, a Notice for Termination for “just
cause” shall be required to include a copy of a resolution duly adopted by the
Board, with at least two-thirds (2/3) of the non-management members of the Board
voting in favor thereof, at a meeting of the Board which was called for the
purpose of considering such termination and which the Executive and his
representative had the right to attend and address the Board, finding that, in
the good faith of the Board, the Executive engaged in conduct set forth in the
definition of “just cause” herein and specifying the particulars thereof in
reasonable detail. Any purported termination for “just cause” which is held by
an arbitrator not to have been based on the grounds set forth in this Agreement
or not to have followed the procedures set forth in this Agreement shall be
deemed a termination by the Company without “just cause.”
 

 
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(ii)             Good Reason. The term “good reason” shall mean any one or more
of the following:
 
(A)             Without the Executive's express written consent, any diminution
in the Executive's titles, authorities, responsibilities or the assignment of
the Executive to any duties inconsistent with his position, duties,
responsibilities and status with the Company as its Chairman, or the removal by
the Board, or the failure or refusal of the Board to re-elect, the Executive as
the Chairman of the Company at any time during the term of this Agreement. For
purposes hereof, a “diminution in the Executive's titles, authorities or
responsibilities” shall be deemed to have occurred if the Company is no longer
required to file reports pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934, as amended.
 
(B)             The Company's breach of any provision of this Agreement or any
other agreement between the Company and the Executive and failure, within the
ten (10) day period following its receipt of written notice from the Executive
describing such breach in reasonable detail, to promptly commence in good faith
to cure such breach (if curable); provided that such cure must be effected no
later than thirty (30) days following such notice and provided further that such
cure right shall not be available on more than one occasion in any twelve (12)
month period.
 
(C)             Adoption by a majority of the Board of any resolution or series
of related resolutions that, individually or collectively, has or could
reasonably be expected to have a material effect on the strategic direction,
operations, financial condition or results of operations of the Company and that
is voted against by the Executive in a good faith exercise of his fiduciary duty
or the failure or refusal of a majority of the Board to adopt a proposed
resolution or series of related resolutions that, individually or collectively,
has or could reasonably have been expected to have a material effect on the
strategic direction, operations, financial condition or results of operations of
the Company and that the Executive proposed, by a motion or series of motions
(whether or not seconded), be adopted by the Board in a good faith exercise of
his fiduciary duty.
 
(D)             Failure of the Company to obtain the assumption in writing (a
copy of which is delivered to the Executive) of the Company's obligations
hereunder to the Executive by any successor to the Company prior to or at the
time of a merger, acquisition, consolidation, disposition of substantially all
of the assets of the Company or similar transaction.
 
The Executive must assert a “good reason” termination event no later than ninety
(90) days after the Executive discovers such event.
 
(iii)             Disability. The Executive shall be considered to be subject to
a “Disability” if, as a result of physical or mental sickness or incapacity or
accident, the Executive is unable to perform the normal duties of his employment
with the Company for a period of ninety (90) days in any one hundred twenty
(120) day period. If there is any disagreement between the Company and the
Executive as to whether the Executive was unable to perform the normal duties of
his employment due to Disability, the same shall be determined after examination
of the Executive by a physician selected by the Executive (or, if the Executive
is unable to make such selection, it shall be made by the Executive's spouse or,
if the Executive is not married or if his spouse is unable or unwilling to make
the selection, by any other adult member of the Executive's immediate family)
and approved by the Company. The costs and expenses of such examination shall be
borne by the Company. The determination of such physician shall be conclusive
evidence as to whether the Executive was unable to perform the normal duties of
his employment due to Disability. If the Executive does not permit such
examination by such physician, then, for purposes hereof, the determination as
to whether the Executive was unable to perform the normal duties of his
employment due to Disability shall be made by the Board. Nothing herein shall
have any effect upon the Executive's eligibility to receive any disability
benefits from the Company pursuant to the terms and conditions of any disability
plan or other arrangement which the Company may have in effect from time to
time.
 

 
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(iv) Retirement. The term “Retirement” shall mean voluntary termination of
employment with the Company and its Subsidiaries after attaining the age of 65.
 
(e)             Termination Payment. In the event of the termination of the
Executive’s employment as hereinabove set forth, the Executive shall be entitled
to receive the following payments from the Company, such payments to be made
within ten (10) days following the date on which the Executive’s employment
terminates, subject to the provisions of Section 18 of this Agreement and the
Company’s Nonqualified Deferred Compensation Plan (the “NQDC Plan”):
 
(i)             Termination for Just Cause. In the event the Company terminates
the Executive's employment pursuant to Section 4(a)(i) of this Agreement, the
Company shall have no further obligation under Sections 3 and 4 of this
Agreement except to pay the Executive any compensation earned but not yet paid,
including without limitation, the Base Salary and Annual Bonus for the calendar
year in which the date of termination falls, in each case prorated for the
number of days of the calendar year that elapsed prior to the date of
termination, any accrued vacation pay payable pursuant to the Company's
policies, any unreimbursed business expenses, and any amounts or benefits due to
him pursuant to the NQDC Plan (collectively the “Accrued Amounts”).
 
(ii)             Termination Without Just Cause. In the event the Company
terminates the Executive's employment pursuant to Section 4(a)(ii) of this
Agreement, the Executive's employment under this Agreement shall terminate at
the expiration of said thirty (30) day period, and the Company shall have no
further obligation under Sections 3 and 4 of this Agreement except to pay to the
Executive a cash lump sum amount (except as otherwise provided in the NQDC Plan)
equal to the sum of:
 
(A)             the Accrued Amounts; and
 
(B)             the Executive's Base Salary and the average of the annual
bonuses received by the Executive for the three years prior to the year in which
such termination occurs (collectively, the “Severance Payment”); which sum shall
be paid by the Company as soon as practicable after the termination date, but in
no event later than ten (10) days after the termination of the Executive's
employment; provided, however, that in the event of any termination without just
cause that occurs in contemplation of or within two years following a Change in
Control, the Company shall instead pay to the Executive a cash lump sum amount
equal to the sum of the Accrued Amounts and two times the Severance Payment.
Notwithstanding the foregoing, in the event the Company terminates the
Executive's employment pursuant to Section 4(a)(ii), the Company may, at its
option, require the Executive to cease providing services hereunder and serving
as an employee of the Company at any time during said thirty (30) day period. In
addition, all stock options and/or equity granted to the Executive shall fully
vest and become exercisable upon the termination date. The Company shall
continue to provide the Executive (and his spouse and dependents) with group
health plan benefits (or substantially similar substitute arrangements), at its
sole expense, for one year (the “One Year Medical Benefits”).
 

 
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(iii)             Termination for Good Reason. In the event the Executive
terminates the Executive's employment pursuant to Section 4(b)(i) of this
Agreement, the Company shall have no further obligation under Sections 3 and 4
of this Agreement except to pay to the Executive a cash lump sum equal to the
Accrued Amounts and the Severance Payment, which shall be paid by the Company as
soon as practicable after the termination date, but in no event later than ten
(10) days after the termination of the Executive's employment; provided,
however, that in the event of any termination for good reason that occurs in
contemplation of or within two years following a Change in Control, the Company
shall instead pay to the Executive a cash lump sum amount equal to the sum of
the Accrued Amounts and two times the Severance Payment. In addition, all stock
options and/or equity granted to the Executive shall fully vest and become
exercisable upon the termination date. The Company shall also provide the
Executive (and his spouse and dependents) with the One Year Medical Benefits.
 
(iv)             Termination Without Good Reason. In the event the Executive
terminates the Executive's employment pursuant to Section 4(b)(ii) of this
Agreement, the Executive's employment under this Agreement shall terminate at
the expiration of said thirty (30) day period, and the Company shall have no
further obligation under Sections 3 and 4 of this Agreement except to pay the
Executive a cash lump sum equal to the Accrued Amounts. Notwithstanding the
foregoing, in the event the Executive terminates his employment pursuant to
Section 4(b)(ii), the Company may, at its option, require the Executive to cease
providing services hereunder and serving as an employee of the Company at any
time during said thirty (30) day period; provided that the Executive shall be
entitled to such payments as would have otherwise been due to him had he
continued in the employment of the Company for such thirty (30) day period,
including, without limitation, payments of the Accrued Amounts and amounts to be
paid under any other plan, agreement or policy which survives the termination of
this Agreement.
 
(v)             Termination upon Retirement, Death, or Disability. In the event
the Executive's employment is terminated pursuant to Section 4(c) hereof, the
Company shall have no further obligation under Sections 3 and 4 of this
Agreement except to pay to the Executive (or his personal representative or
guardian) a cash lump sum amount equal to the Accrued Amounts and the Severance
Payment In addition, all stock options and/or equity granted to the Executive
shall fully vest and become exercisable upon the termination date. The Company
shall also provide the Executive (and/or his spouse and dependents as
applicable) with the One Year Medical Benefits.
 
(f)              Section 401(k) Savings Plan. Notwithstanding any other
provision of this Agreement to the contrary, in the event of the termination of
the Executive’s employment for any reason or no reason, the Company shall direct
that payment be made to the Executive of amounts due him pursuant to the
Company’s Section 401(k) Savings Plan.
 
(g)             COBRA. In the event that the Company’s group health plan does
not permit the Company to provide continuation coverage for the Executive for
the one (1) year period in which the One Year Medical Benefits are to be
provided and does not permit the Executive to elect COBRA coverage within sixty
(60) days after the expiration of said one (1) year period and for COBRA
coverage to begin on the first day following the expiration of said one (1) year
period, the Company shall use reasonable good faith efforts within ninety (90)
days after the Commencement Date to amend its group health plan to permit the
Company to provide continuation coverage for the Executive for said one (1) year
period and to permit the Executive to make such election and, if made, for COBRA
coverage to begin on the first day following the expiration of said one (1) year
period; provided, however, that the Company shall not be required to change
health insurance companies or to pay additional premiums for any employee or
former employee other than the Executive in order to effect, or as a result of,
such amendment. Nothing herein shall be construed as limiting the COBRA rights
of the Executive (or his spouse and dependents).
 

 
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(h)             Health Benefits. Notwithstanding any other provision of this
Agreement to the contrary, if the provision of any health benefit hereunder
would cause any group health plan of the Company to be deemed "discriminatory"
under applicable law, and would thereby cause the Company to incur penalties
thereunder, then the Company shall have the right unilaterally to amend this
Agreement to prevent the group health plan from being discriminatory by
eliminating any continued health benefits hereunder or subsidy thereof, other
than such continuation coverage as the Executive shall be entitled to under
COBRA.
 
5.             WITHHOLDING. The Company shall be entitled to withhold from
amounts to be paid to the Executive hereunder any federal, state, or local
withholding or other taxes or charges which it is from time to time required to
withhold; provided, that the amount so withheld shall not exceed the minimum
amount required to be withheld by law in light of the circumstances. The Company
shall be entitled to rely on an opinion of tax counsel if any question as to the
amount or requirement of any such withholding shall arise.
 
6.             NOTICES. All notices provided for by this Agreement shall be in
writing and shall be (a) personally delivered to the party thereunto entitled or
(b) deposited in the United States mail, postage prepaid, addressed to the party
to be notified at the address listed below (or at such other address as may have
been designated by written notice), certified or registered mail, return receipt
requested. The notice shall be deemed to be received (a) if by personal
delivery, on the date of its actual receipt by the party entitled thereto or (b)
if by mail, two (2) days following the date of deposit in the United States
mail.
 
To the Company:  Atrion Corporation
One Allentown Parkway
Allen, TX 75002
Attention: Chief Financial Officer
 
To the Executive: Emile A Battat
 
To the most recent address on file with the Company.
 
7.             PARTIES BOUND. This Agreement and the rights and obligations
hereunder shall be binding upon and inure to the benefit of the Company, the
Executive, and their respective heirs, personal representatives, successors and
assigns; provided, however, that the Executive may not assign any rights or
obligations hereunder without the express written consent of Company. This
Agreement shall also bind and inure to the benefit of any successor of the
Company by merger or consolidation, or any assignee of all or substantially all
of the Company's properties.
 

 
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8.             INVALID PROVISIONS. If any provision of this Agreement is held to
be illegal, invalid, or unenforceable under present or future laws effective
during the term hereof, such provision shall be fully severable; this Agreement
shall be construed and enforced as if such illegal, invalid, or unenforceable
provision had never comprised a part hereof; and the remaining provisions hereof
shall remain in full force and effect and shall not be affected by the illegal,
invalid, or unenforceable provision or by its severance herefrom.
 
9.             NO MITIGATION; NO SET-OFF.
 
(a)             No Duty to Mitigate. In the event of any termination of
employment hereunder, the Executive shall be under no obligation to seek other
employment and there shall be no offset against any amounts due the Executive
under this Agreement on account of any remuneration attributable to any
subsequent employment that the Executive may obtain.
 
(b)             Other Payments. Any amounts or benefits payable to the Executive
under this Agreement are, in addition to, and are not in lieu of, amounts
payable to the Executive under any other salary continuation or cash severance
arrangement of the Company or any other type of agreement entered into between
the parties, and to the extent paid or provided under any other such arrangement
or agreement shall not be offset from the amounts or benefits due hereunder,
except to the extent expressly provided in such other arrangement or agreement.
 
10.             ATTORNEYS' FEES AND COSTS. In the event that it becomes
necessary for the Executive to seek legal counsel with regard to a dispute,
claim or issue under this Agreement or the Executive deems it necessary to
initiate arbitration in order to enforce his rights hereunder, then the Company
shall bear and, upon notification to the Company by the Executive, immediately
advance to the Executive all expenses of such dispute, claim, issue or
arbitration, including the reasonable fees and expenses of the counsel of the
Executive incurred in connection with such dispute, claim, issue or arbitration,
unless an arbitrator determines that the Executive's position was frivolous or
otherwise taken in bad faith, in which case an arbitrator may determine that the
Executive shall bear his own legal fees. Notwithstanding any existing or prior
attorney-client relationship between the Company and the counsel selected by the
Executive, the Company irrevocably consents to the Executive's entering into an
attorney-client relationship with such counsel, and in that connection the
Company and the Executive agree that a confidential relationship shall exist
between the Executive and such counsel.
 
11.             ARBITRATION. All disputes and controversies arising under or in
connection with this Agreement, shall be settled by arbitration conducted before
one (1) arbitrator sitting in New York, New York, or such other location agreed
by the parties hereto, in accordance with the National Rules for the Resolution
of Employment Disputes of the American Arbitration Association then in effect.
The determination of the arbitrator shall be final and binding on the parties.
Judgment may be entered on the award of the arbitrator in any court having
proper jurisdiction. All expenses of such arbitration, including the fees and
expenses of the counsel of the Executive, shall be borne by the Company unless
the arbitrator determines that the Executive's position was frivolous or
otherwise taken in bad faith, in which case the arbitrator may determine that
the Executive shall bear his own legal fees.
 

 
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12.             LEGAL FEES. The Company shall pay the Executive's reasonable
legal fees and costs associated with entering into this Agreement.
 
13.             INDEMNIFICATION. The Company shall indemnify and hold harmless
the Executive to the fullest extent permitted under the Company's Bylaws as in
effect on the date hereof or the date of termination of employment, if on such
date the Bylaws provide the Executive with greater rights to indemnification,
and to the fullest extent permitted by law for any action or inaction of the
Executive while serving as an officer or director of the Company or, at the
Company's request, as an officer or director of any other entity or as a
fiduciary of any benefit plan. The Company shall cover the Executive under
directors and officers liability insurance both during and, while potential
liability exists, after the Employment Term (but in no event for a period which
is less than six (6) years after termination) in the same amount and to the same
extent as the Company covers its other officers and directors as of the
Commencement Date or the date of termination of employment, if on such date the
Executive will receive greater coverage under such insurance.
 
14.             WAIVERS AND CONSENTS. One or more waivers of any breach of any
covenant, term or provision of this Agreement by any party shall not be
construed as a waiver of a subsequent breach of the same covenant, term or
provision, nor shall it be considered a waiver of any other then existing or
subsequent breach of a different covenant, term or provision. The consent or
approval of either party to or of any act by the other party requiring such
consent or approval shall not be deemed to waive or render unnecessary consent
to or approval or any subsequent similar act. No custom or practice of the
parties shall constitute a waiver of either party's rights to insist upon strict
compliance with the terms hereof.
 
15.             SECTION HEADINGS. The headings contained in this Agreement are
for reference purposes only and do not affect in any way the meaning or
interpretation of this Agreement.
 
16.             MULTIPLE COUNTERPARTS. This Agreement may be executed in
counterparts, each of which for all purposes is to be deemed an original, and
both of which constitute, collectively, one agreement; but in making proof of
this Agreement, it shall not be necessary to produce or account for more than
one such counterpart.
 
17.             GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas, without regard to its
conflict-of-law rules.
 
18.             SECTION 409A. The intent of the parties is that this Agreement
will be in full compliance with Section 409A of the Internal Revenue Code of
1986, as amended (the “Code”), and in the event that any provision of this
Agreement, or any payment of compensation or benefits paid pursuant to this
Agreement is determined to be inconsistent with the requirements of Section 409A
of the Code, the Company shall reform this Agreement and to the extent necessary
to comply therewith and to avoid the imposition of any penalties or taxes
pursuant to Section 409A of the Code, provided that any such reformation shall
to the maximum extent possible retain the originally intended economic and tax
benefits to the Executive and the original purpose of this Agreement without
violating Section 409A of the Code or creating any unintended or adverse
consequences to the Executive. Notwithstanding any other provision of this
Agreement to the contrary, if the Executive is a “specified employee” within the
meaning of Section 409A of the Code and the regulations thereunder at the
relevant time, then, solely to the extent required to comply with applicable
provisions Section 409A of the Code with respect to any amounts or benefits not
exempt under Section 409A of the Code, payments made hereunder on account of the
termination of the Executive’s employment shall not commence until the date that
is first day of the seventh month following the Executive’s “separation from
service” as determined in accordance with Section 409A of the Code.
 
 
 
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19.             ENTIRE AGREEMENT. This Agreement contains the entire agreement
of the parties hereto, and supersedes all prior agreements, including the
Current Employment Agreement, and understandings, oral or written, if any,
between the parties hereto, with respect to the subject matter hereof. No
modification or amendment of any of the terms, conditions, or provisions herein
may be made otherwise than by written agreement signed by the parties hereto.
 
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
and delivered as of the date first above written.
 
ATRION CORPORATION
 

By: /s/ David A.
Battat                                                                               
Name: David A. Battat
Title: President and Chief Executive Officer
  

/s/ Emile A
Battat                                                                    
EMILE A BATTAT
 
 
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Exhibit A
 
(a)             For purposes of the Agreement, the term “Change in Control”
shall mean the occurrence of any one of the following events:
 
(i)             any person (as the term “person” is used in Section 13(d) (3) or
Section 14(d) (2) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)) (other than the Company, any of its subsidiaries, or any
trustee or other fiduciary holding securities of the Company under an employee
benefit plan of the Company or any of its subsidiaries) becomes the beneficial
owner (as the term “beneficial owner” is defined under Rule 13d-3 or any
successor rule or regulation promulgated under the Exchange Act) of securities
of the Company representing 25% or more of the combined voting power of the
then-outstanding voting securities of the Company
 
(ii)             the Company is merged, consolidated or reorganized into or with
another corporation or other person and as a result of such merger,
consolidation or reorganization less than 50% of the combined voting power of
the then-outstanding securities of such corporation or person immediately after
such transaction are held in the aggregate by the holders of voting securities
of the Company immediately prior to such transaction;
 
(iii)             the stockholders of the Company approve a plan of complete
liquidation of the Company or the Company sells all or substantially all of its
assets to any other corporation or other person and as a result of such sale
less than 50% of the combined voting power of the then-outstanding voting
securities of such corporation or person immediately after such transaction are
held in the aggregate by the holders of voting securities of the Company
immediately prior to such sale; or
 
(iv)             during any period of two consecutive years, individuals who, at
the beginning of any such period, constitute the directors of the Company cease
for any reason to constitute at least a majority thereof unless the election or
the nomination for election by the Company's stockholders of each director of
the Company first elected during such period was approved by a vote of at least
two-thirds of the directors of the Company then still in office who were
directors of the Company at the beginning of any such period.
 
 
 
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