Exhibit 10.34
(LOGO) [h42368x4236800.gif]
David S. Wise
Vice President
General Counsel
(281) 228-7268 Direct Line
(281) 283-5369 Facsimile
September 28, 2006
Robert P. Cummins
4 Wexford Court
Houston, TX 77024
Re: Advancement of Attorney ’s Fees
Dear Mr. Cummins:
     This Agreement, Affirmation and Undertaking is to confirm the terms under
which Cyberonics, Inc., a Delaware corporation, (“Cyberonics” or the “Company”)
will agree to your request that it advance your reasonable attorney’s fees and
costs (collectively, “Fees”) in connection with any action, suit or proceeding,
whether civil, criminal, administrative, or investigative, regarding Cyberonics’
practices and procedures for granting stock options (collectively,
“Proceedings”).
     The terms are as follows:
     1. Subject to the terms of this Agreement, the Company’s bylaws and
articles of incorporation, and applicable law, Cyberonics agrees to advance Fees
incurred by you in connection with the Proceedings.
     2. You agree to undertake to repay all Fees advanced by Cyberonics pursuant
to this Agreement if it shall ultimately be determined that you are not entitled
to indemnification. The obligations of this paragraph shall survive termination
of this Agreement.
     3. You agree that with respect to any amounts advanced to you or on your
behalf by Cyberonics in connection with the Proceedings: (i) Cyberonics will be
subrogated to any right you have to recover such amounts from any third party
including, but not limited to, any right you have to any insurance coverage that
may be available to you under any insurance policy procured by or on behalf of
Cyberonics; (ii) you will cooperate with Cyberonics and take any action
reasonably necessary to assist or enable Cyberonics to exercise the rights to
which it is subrogated under the preceding clause including, but not limited to,
executing any formal assignment or other legal instrument that may be required
in order for Cyberonics to pursue or enforce such rights; and (iii) you will
cooperate with Cyberonics and take any action reasonably necessary to assist or
enable Cyberonics to obtain reimbursement or direct payment of such amounts
under any insurance policy procured by Cyberonics. The obligations of this
paragraph shall survive termination of this Agreement.
100 Cyberonics Blvd • Houston, TX 77058 • Tel: (800) 332-1375 •
Fax:(281) 218-9332
Belgicastraat 9 • 1930 Zaventem • Belgium • Tel: 32 2 720 95 93 • Fax: 32 2 720
60 53
www.cyberonics.com

 

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Robert P. Cummins
September 28, 2006   Page 2

     4. You shall cause your legal counsel to send to Cyberonics, each month, an
invoice for the fees and expenses of counsel for the immediately preceding
month. All such invoices shall provide a description of the services performed
(subject to the reasonable requirements for you to maintain the attorney-client
privilege), shall set forth the hours worked and the hourly rate of the attorney
who performed the services, shall conform to any applicable billing guidelines
and procedures, and shall otherwise be in form and substance acceptable to
Cyberonics.
     5. You shall send all invoices and notices under this Agreement to: Office
of General Counsel, Cyberonics, Inc., 100 Cyberonics Boulevard, Houston, TX
77058.
     6. This Agreement covers only the advancement of Fees in connection with a
Proceeding. The rights and obligations of you and Cyberonics regarding any
possible claim of indemnification by you from or against any damages, fines,
penalties or awards, whether in connection with a Proceeding or otherwise, are
not governed by this Agreement, but will be determined under the bylaws and
articles of incorporation of Cyberonics, applicable law, and any applicable
contract.
     7. To the extent there is any inconsistency between this Agreement and the
terms of the Company’s bylaws and articles of incorporation or applicable law,
the Company’s bylaws and articles of incorporation and applicable law shall
govern over the terms herein.
     To indicate your agreement with the terms of this Agreement, please execute
a copy in the space provided below and return it to Cyberonics’ General Counsel.

            Sincerely,
Cyberonics, Inc.
      By:   /s/ David S. Wise         David S. Wise         Vice President &
General Counsel     

     
 
   
AGREED AND ACCEPTED:
   
 
   
/s/ Robert P. Cummins
         
Robert P. Cummins
   

Date: 10/3/06