**Exhibit 10.22**

 

**CHANGE IN CONTROL AGREEMENT**

 

December 10, 2008

 

RezaA. Ghanbari

3144Northview Road

Wayzata,MN 55391

 

Dear Dr. Ghanbari:

 

Inconnection with your hiring as the Executive Vice President, Strategy andProducts of Vital Images, Inc., a Minnesota corporation (the “Company”),we hereby offer you valuable and unique benefits.  The Company considers the establishment andmaintenance of a sound and vital management to be essential to protecting andenhancing the best interests of the Company and its shareholders.  In this connection, the Company recognizesthat, as is the case with many publicly held corporations, the possibility of aChange in Control may arise and that such possibility and the uncertainty andquestions which it may raise among management may result in the departure ordistraction of management personnel to the detriment of the Company and itsshareholders.

 

Accordingly, the Board has determined thatappropriate steps should be taken to minimize the risk that Company managementwill depart prior to a Change in Control, thereby leaving the Company withoutadequate management personnel during such a critical period, and thatappropriate steps also be taken to reinforce and encourage the continuedattention and dedication of members of the Company’s management to theirassigned duties without distraction in circumstances arising from thepossibility of a Change in Control.  Inparticular, the Board believes it important, should the Company or itsshareholders receive a proposal for transfer of control, that you be able tocontinue your management responsibilities without being influenced by theuncertainties of your own personal situation.

 

The Board recognizes that continuance of yourposition with the Company involves a substantial commitment to the Company interms of your personal life and professional career and the possibility offoregoing present and future career opportunities, for which the Companyreceives substantial benefits. Therefore, to induce you to remain in the employ of the Company, thisAgreement, which has been approved by the Board, sets forth the benefits whichthe Company agrees will be provided to you in the event your employment withthe Company is terminated in connection with a Change in Control under the circumstancesdescribed below.

 

The following terms will have the meaning setforth below unless the context clearly requires otherwise.  Terms defined elsewhere in this Agreementwill have the same meaning throughout this Agreement.

 

**ARTICLEI.**

**DEFINITIONS**

 

1.             “Affiliate” means (i) anycorporation more than 50% of whose outstanding securities ordinarily having theright to vote at elections of directors is owned directly or indirectly by theCompany or (ii) any other form of business entity in which the Company, byvirtue of a direct or indirect ownership interest, has the right to elect amajority of the members of such entity’s governing body.

 

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2.             “Agreement” means this letteragreement as amended, extended or renewed from time to time in accordance withits terms.

 

3.             “Board” means the board of directorsof the Company duly qualified and acting at the time in question.  On and after the date of a Change in Control,any duty of the Board in connection with this Agreement is nondelegable and anyattempt by the Board to delegate any such duty is ineffective.

 

4.             “Cause” means:

 

a.             your gross misconduct;

 

b.             your willful and continued failure to performsubstantially your duties with the Company (other than any such failure (1) resultingfrom your Disability or incapacity due to bodily injury or physical or mentalillness or (2) relating to changes in your duties after a Change in Controlwhich constitute Good Reason) after a demand for substantial performance isdelivered to you by the chair of the Board which specifically identifies themanner in which you have not substantially performed your duties and providesfor a reasonable period of time within which you may take corrective actions;or

 

c.             your conviction (including a plea of nolocontendere) of willfully engaging in illegal conduct constituting a felony orgross misdemeanor under federal or state law which is materially anddemonstrably injurious to the Company or which impairs your ability to performsubstantially your duties for the Company.

 

An act or failure to actwill be considered “gross” or “willful” for this purpose only if done, oromitted to be done, by you in bad faith and without reasonable belief that itwas in, or not opposed to, the best interests of the Company.  Any act, or failure to act, based uponauthority given pursuant to a resolution duly adopted by the Company’s board ofdirectors (or a committee thereof) or based upon the advice of counsel for theCompany will be conclusively presumed to be done, or omitted to be done, by youin good faith and in the best interests of the Company.  It is also expressly understood that yourattention to matters not directly related to the business of the Company willnot provide a basis for termination for Cause so long as the Board did notexpressly disapprove in writing of your engagement in such activities eitherbefore or within a reasonable period of time after the Board knew or couldreasonably have known that you engaged in those activities.  Notwithstanding the foregoing, you may not beterminated for Cause unless and until there has been delivered to you a copy ofa resolution duly adopted by the affirmative vote of not less than a majorityof the entire membership of the Board at a meeting of the Board called and heldfor the purpose (after reasonable notice to you and an opportunity for you,together with your counsel, to be heard before the Board), finding that in thegood faith opinion of the Board you were guilty of the conduct set forth abovein clauses a., b. or c. of this definition and specifying the particularsthereof in detail.

 

5.             “Change in Control” means any of thefollowing:

 

a.             the sale, exchange or other transfer,directly or indirectly, of all or substantially all of the assets of theCompany to any Person in one transaction or in a series of related transactionswhich occur during the twelve-month period ending on the date of the mostrecent purchase or other acquisition by such Person;

 

b.             any Person is or becomes the “beneficialowner” (as defined in Rule 13d-3 under the Exchange Act), directly orindirectly, of (1) 30 percent or more, but not more than 50

 

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percent, of the combinedvoting power of the outstanding securities of the Company ordinarily having theright to vote at elections of directors, unless the transaction resulting insuch ownership has been approved in advance by the “continuing directors” or (2) morethan 50 percent of the combined voting power of the outstanding securities ofthe Company ordinarily having the right to vote at elections of directors(regardless of any approval by the continuing directors);

 

d.             a merger or consolidation to which theCompany is a party if the shareholders of the Company immediately prior to theeffective date of such merger or consolidation have, solely on account ofownership of securities of the Company at such time, “beneficial ownership” (asdefined in Rule 13d-3 under the Exchange Act) immediately following theeffective date of such merger or consolidation of securities of the survivingcompany representing less than 50 percent of the combined voting power of thesurviving corporation’s then outstanding securities ordinarily having the rightto vote at elections of directors (regardless of any approval by the continuingdirectors); or

 

e.             the continuing directors cease for any reasonto constitute at least a majority of the Board.

 

For purposes of this Section 1(e),a “continuing director” means any individual who is a member of the Board on August 1,2008, while he or she is a member of the Board, and any individual whosubsequently becomes a member of the Board whose election or nomination forelection by the Company’s shareholders was approved by a vote of at least amajority of the directors who are continuing directors (either by a specificvote or by approval of the proxy statement of the Company in which suchindividual is named as a nominee for director without objection to suchnomination).

 

In all cases, thedetermination of whether a Change in Control has occurred shall be made inaccordance with Code Section 409A and the regulations, notices and otherguidance of general applicability issued thereunder.

 

6.             “Code” means the Internal Revenue Codeof 1986, as amended.  Any reference to aspecific provision of the Code includes a reference to such provision as it maybe amended from time to time and to any successor provision.

 

7.             “Company” means Vital Images, Inc.and/or any Affiliate.

 

8.             “Confidential Information” meansinformation which is proprietary to the Company or proprietary to others andentrusted to the Company, whether or not trade secrets. It includes informationrelating to business plans and to business as conducted or anticipated to beconducted, and to past or current or anticipated products or services.  It also includes, without limitation,information concerning research, development, purchasing, accounting, marketingand selling.  All information which youhave a reasonable basis to consider confidential is Confidential Information,whether or not originated by you and without regard to the manner in which youobtain access to that and any other proprietary information.

 

9.             “Date of Termination” following aChange in Control (or prior to a Change in Control if your termination waseither a condition of the Change in Control or was at the request or insistenceof any Person related to the Change in Control) means:

 

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a.             if your employment is to be terminated forDisability, 30 days after Notice of Termination is given (provided that youhave not returned to the performance of your duties on a full-time basis duringsuch 30-day period);

 

b.             if your employment is to be terminated by theCompany for Cause or by you for Good Reason, the date specified in the Noticeof Termination, which date may not be less than 30 days or more than 60 daysafter the date on which the Notice of Termination is given unless you and theCompany otherwise expressly agree;

 

c.             if your employment is to be terminated by theCompany for any reason other than Cause, Disability, death or Retirement, thedate specified in the Notice of Termination, which in no event may be a dateearlier than 90 days after the date on which a Notice of Termination is given,unless an earlier date has been expressly agreed to by you in writing either inadvance of, or after; receiving such Notice of Termination; or

 

d.             if your employment is terminated by reason ofdeath or Retirement, the date of death or Retirement, respectively.

 

In the case of terminationby the Company of your employment for Cause, if you have not previouslyexpressly agreed in writing to the termination, then within 30 days afterreceipt by you of the Notice of Termination with respect thereto, you maynotify the Company that a dispute exists concerning the termination, in whichevent the Date of Termination will be the date set either by mutual writtenagreement of the parties or by the judge or arbitrators in a proceeding asprovided in Article VII Section 6 of this Agreement.  During the pendency of any such dispute, youwill continue to make yourself available to provide services to the Company andthe Company will continue to pay you your full compensation and benefits ineffect immediately prior to the date on which the Notice of Termination isgiven (without regard to any changes to such compensation or benefits whichconstitute Good Reason) and until the dispute is resolved in accordance with Article VIISection 6 of this Agreement.  Youwill be entitled to retain the full amount of any such compensation andbenefits without regard to the resolution of the dispute unless the judge orarbitrators decide(s) that your claim of a dispute was frivolous oradvanced by you in bad faith.

 

10.           “Disability” means a disability as defined in the Company’slong-term disability plan as in effect immediately prior to the Change inControl or; in the absence of such a plan, means permanent and total disabilityas defined in section 22(e)(3) of the Code.

 

11.           “Exchange Act” means the Securities Exchange Act of 1934, asamended.  Any reference to a specificprovision of the Exchange Act or to any rule or regulation thereunderincludes a reference to such provision as it may be amended from time to timeand to any successor provision.

 

12.           “Good Reason” means:

 

a.             change in your status, position(s), duties or responsibilities as anexecutive of the Company as in effect immediately prior to the Change inControl which, in your reasonable judgment, is an adverse change (other than,if applicable, any such change directly attributable to the fact that theCompany is no longer publicly owned) except in connection with the terminationof your employment for Cause, Disability or Retirement or as a result of yourdeath or by you other than for Good Reason;

 

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b.             a reduction by the Company in your base salary (or an adverse change inthe form or timing of the payment thereof) as in effect immediately prior tothe Change in Control or as thereafter increased;

 

c.             the failure by the Company to continue ineffect any Plan in which you (and/or your family) are eligible to participateat any time during the 90-day period immediately preceding the Change inControl (or Plans providing you (and/or your family) with at leastsubstantially similar benefits) other than as a result of the normal expirationof any such Plan in accordance with its terms as in effect immediately prior tothe 90-day period immediately preceding the time of the Change in Control, orthe taking of any action, or the failure to act, by the Company which wouldadversely affect your (and/or your family’s) continued eligibility toparticipate in any of such Plans on at least as favorable a basis to you(and/or your family) as is the case on the date of the Change in Control orwhich would materially reduce your (and/or your family’s) benefits in thefuture under any of such Plans or deprive you (and/or your family) of anymaterial benefit enjoyed by you (and/or your family) at the time of the Changein Control;

 

d.             the Company’s requiring you to be based morethan 30 miles from where your office is located immediately prior to the Changein Control, except for required travel on the Company’s business, and then onlyto the extent substantially consistent with the business travel obligationswhich you undertook on behalf of the Company during the 90-day periodimmediately preceding the Change in Control (without regard to travel relatedto or in anticipation of the Change in Control);

 

e.             the failure by the Company to obtain from anySuccessor the assent to this Agreement contemplated by Article VI of thisAgreement;

 

f.              any purported termination by the Company ofyour employment which is not properly effected pursuant to a Notice ofTermination and pursuant to any other requirements of this Agreement, and forpurposes of this Agreement, no such purported termination will be effective;

 

g.             any refusal by the Company to continue toallow you to attend to matters or engage in activities not directly related to thebusiness of the Company which, at any time prior to the Change in Control, youwere not expressly prohibited in writing by the Board from attending to orengaging in; or

 

h.             the termination of your employment by theCompany for any reason other than death,  Cause, Disability or Retirement during thetwelve (12) months following the month in which a Change in Control occurs.

 

13.           “Notice of Termination” means a written notice given on or afterthe date of a Change in Control (unless your termination before the date of theChange in Control was either a condition of the Change in Control or was at therequest or insistence of any Person related to the Change in Control) whichindicates the specific termination provision in this Agreement pursuant to whichthe notice is given.  Any purportedtermination by the Company or by you for Good Reason on or after the date of aChange in Control (or before the date of a Change in Control if yourtermination was either a condition of the Change in Control or was at therequest or insistence of any Person related to the Change in Control) must becommunicated by written Notice of Termination to be effective; provided, thatyour failure to provide Notice of Termination will not limit any of your rightsunder

 

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this Agreement except to theextent the Company demonstrates that it suffered material actual damages byreason of such failure.

 

14.           “Person” means any individual, corporation, partnership, group,association or other “person,” as such term is used in section 14(d) ofthe Exchange Act, other than the Company, any Affiliate or any employee benefitplan(s) sponsored by the Company or an Affiliate.

 

15.           “Plan” means any compensation plan, program, policy or agreement(such as a stock option, restricted stock plan or other equity-based plan), anybonus or incentive compensation plan, program, policy or agreement, anyemployee benefit plan, program, policy or agreement (such as a thrift, pension,profit sharing, medical, dental, disability, accident, life insurance,relocation, salary continuation, expense reimbursements, vacation or fringebenefits plan or policy) or any other plan, program, policy or agreement of theCompany intended to benefit employees (and/or their families) generally,management employees (and/or their families) as a group or you (and/or yourfamily) in particular.

 

16.           “Retirement” means termination of employment on or after the dayon which you attain the age of 65.

 

17.           “Successor” means any Person that succeeds to, or has thepractical ability to control (either immediately or solely with the passage oftime), the Company’s business directly, by merger, consolidation or other formof business combination, or indirectly, by purchase of the Company’s outstandingsecurities ordinarily having the right to vote at the election of directors or,all or substantially all of its assets or otherwise.

 

**ARTICLEII.**

**TERM OF AGREEMENT**

 

This Agreement is effective immediately and willcontinue in effect until December 10, 2009; provided, however; thatcommencing on December 10, 2009 and each December 10 thereafter, theterm of this Agreement will automatically be extended for 12 additional monthsbeyond the expiration date otherwise then in effect, unless at least 90calendar days prior to any such December 10, the Company or you has givennotice that this Agreement will not be extended; and, provided, further; thatif a Change in Control has occurred during the term of this Agreement, thisAgreement will continue in effect beyond the termination date then in effectfor a period of 12 months following the month during which the Change inControl occurs or, if later, until the date on which the Company’s obligationsto you arising under or in connection with this Agreement have been satisfiedin full.

 

**ARTICLEIII.**

**CHANGEIN CONTROL BENEFITS**

 

1.             Benefits upon a Change in Control Termination.  Youwill become entitled to the payments and benefits described in clauses (a) and(b) of this Section 1 of Article III, subject to the limitationsdescribed in clause (c) of this Section 1 of Article III, and tothe benefit of the provisions described in clause (c), if and only if (i) youremployment with the Company is terminated by the Company for any reason otherthan death, Cause, Disability or Retirement, or if you terminate youremployment with the Company for Good Reason; and (ii) the terminationoccurs either within the period beginning on the date of a Change in Controland ending on the last day of the twelfth month that begins after the monthduring which the Change in Control occurs or prior to a Change in Control if

 

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your termination was eithera condition of the Change in Control or was at the request or insistence of aPerson related to the Change in Control.

 

a.             Cash Payment. Within ten (10) business days following the Date of Termination or,if later, within ten (10) business days following the date of the Changein Control, the Company will make a lump-sum cash payment to you in an amountequal to your annual base salary in effect on the date of the Change inControl.

 

b.             Welfare Plans. The Company will maintain in full force andeffect, for the continued benefit of you and your dependents for a periodterminating 24 months after the Date of Termination, all insured andself-insured employee welfare benefit Plans (including, without limitation,medical, life, dental, vision and disability plans) in which you were eligibleto participate at any time during the 90-day period immediately preceding theChange in Control, provided that your continued participation is possible underthe general terms and provisions of such Plans and any applicable funding mediaand without regard to any discretionary amendments to such Plans by the Companyfollowing the Change in Control (or prior to the Change in Control if amendedas a condition or at the request or insistence of a Person (other than theCompany) related to the Change in Control) and provided that you continue topay an amount equal to your regular contribution under such Plans for suchparticipation (based upon your level of benefits and employment status mostfavorable to you at any time during the 90-day period immediately preceding theChange in Control).  The continuationperiod under federal and state continuation laws, to the extent applicable,will begin to run from the date on which coverage pursuant to this clause (b) ends.  If, at the end of the 24-month period, youhave not previously received or are not then receiving equivalent benefits froma new employer (including coverage for any pre-existing conditions), theCompany, pursuant to federal and state law, will provide, for a period ofeighteen (18) months (the “COBRA Period”), a continuation of your and your dependents’coverage under such Plans (the “COBRA Coverage”), provided that you will berequired to pay for such benefits during the COBRA Period, should you elect toreceive COBRA Coverage.

 

c.             Limitation on Payments and Benefits. Notwithstanding anything in this Agreement to the contrary, if any ofthe payments or benefits to be made or provided in connection with thisAgreement, together with any other payments, benefits or awards which you havethe right to receive from the Company, or any corporation which is a member ofan “affiliated group” (as defined in section 1504(a) of the Code withoutregard to section 1504(b) of the Code) of which the Company is a member (“Affiliate”),constitute an “excess parachute payment” (as defined in section 280G(b) ofthe Code), two calculations will be performed. In the first calculation, the payments, benefits or awards will bereduced by the amount the Company deems necessary so that none of the paymentsor benefits under the Agreement (including from the existing Stock Option andIncentive Plan) are excess parachute payments. In the second calculation, the payments will not be reduced so as toeliminate an excess parachute payment, but will be reduced by the amount of theapplicable excise tax as imposed by section 4999 of the Code.  The two calculations will be compared and thecalculation providing the largest net payment to the employee will beutilized.  The calculations must be madein good faith by legal counsel or a certified public accountant selected by theCompany, and such determination will be conclusive and binding upon you and theCompany.  If a reduction in payments orbenefits is required by the comparison above, the payments or benefits underthe Agreement shall be reduced in the order that minimizes the

 

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amount of total reduction inpayments and benefits under the Agreement as a result of this provision.

 

d.             409A Restrictions. Notwithstanding the foregoing, if any of the payments or other benefitsdescribed in this Article III are subject to the requirements of Code Section 409Aand the Company determines that you are a “specified employee” as defined inCode Section 409A as of the Date of Termination, such payments shall notbe paid or commence earlier than the first day of the seventh month followingthe Date of Termination.

 

2.             Disposition.  If, on or after the date of aChange in Control, an Affiliate is sold, merged, transferred or in any othermanner or for any other reason ceases to be an Affiliate or all or any portionof the business or assets of an Affiliate are sold, transferred or otherwisedisposed of and the acquiror is not the Company or an Affiliate (a “Disposition”),and you remain or become employed by the acquiror or an affiliate of theacquiror (as defined in this Agreement but substituting “acquiror” for “Company”)in connection with the Disposition, you will be deemed to have terminatedemployment on the effective date of the Disposition for purposes of thissection unless (a) the acquiror and its affiliates jointly and severallyexpressly assume and agree, in a manner that is enforceable by you, to performthe obligations of this Agreement to the same extent that the Company would berequired to perform if the Disposition had not occurred and (b) theSuccessor guarantees, in a manner that is enforceable by you, payment andperformance by the acquiror.  This Section 2of Article III shall be applied in accordance with Code Section 409Aand the regulations, notices and other guidance of general applicability issuedthereunder.

 

**ARTICLEIV.**

**INDEMNIFICATION**

 

Following a Change in Control, the Companywill indemnify and reimburse you to the full extent permitted by law and theCompany’s articles of incorporation and bylaws for damages, costs and expenses(including, without limitation, judgments, fines, penalties, settlements andreasonable fees and expenses of your counsel) incurred in connection with allmatters, events and transactions relating to your service to or status with theCompany or any other corporation, employee benefit plan or other entity withwhom you served at the request of the Company.

 

**ARTICLEV.**

**CONFIDENTIALITY**

 

You will not use, other than in connectionwith your employment with the Company, or disclose any Confidential Informationto any person not employed by the Company or not authorized by the Company toreceive such Confidential Information, without the prior written consent of theCompany; and you will use reasonable and prudent care to safeguard and protectand prevent the unauthorized disclosure of Confidential Information. Nothing inthis Agreement will prevent you from using, disclosing or authorizing thedisclosure of any Confidential Information: (a) which is or hereafterbecomes part of the public domain or otherwise becomes generally available tothe public through no fault of yours; (b) to the extent and upon the termsand conditions that the Company may have previously made the ConfidentialInformation available to certain persons; or (c) to the extent that youare required to disclose such Confidential Information by law or judicial oradministrative process.

 

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**ARTICLEVI.**

**SUCCESSORS**

 

The Company will seek to have any Successor,by agreement in form and substance satisfactory to you, assent to thefulfillment by the Company of the Company’s obligations under this Agreement.Failure of the Company to obtain such assent at least three business days priorto the time a Person becomes a Successor (or where the Company does not have atleast three business days’ advance notice that a Person may become a Successor,within one business day after having notice that such Person may become or hasbecome a Successor) will constitute Good Reason for termination by you of youremployment.  The date on which any suchsuccession becomes effective will be deemed the Date of Termination and Noticeof Termination will be deemed to have been given on that date.  A Successor has no rights, authority or powerwith respect to this Agreement prior to a Change in Control.

 

**ARTICLE VII.**

**OTHER PROVISIONS**

 

1.             Binding Agreement.  ThisAgreement inures to the benefit of, and is enforceable by, you, your personaland legal representatives, executors, administrators, successors, heirs, distributees,devisees and legatees. If you die while any amount would still be payable toyou under this Agreement if you had continued to live, all such amounts, unlessotherwise provided in this Agreement, will be paid in accordance with the termsof this Agreement to your devisee, legatee or other designee or; if there be nosuch designee, to your estate.

 

2.             No Mitigation.  Youwill not be required to mitigate the amount of any payments or benefits theCompany becomes obligated to make or provide to you in connection with thisAgreement by seeking other employment or otherwise. The payments or benefits tobe made or provided to you in connection with this Agreement may not bereduced, offset or subject to recovery by the Company by any payments orbenefits you may receive from other employment or otherwise.

 

3.             No Setoff.  The Company has no right todelay or setoff payments or benefits owed to you under this Agreement againstamounts owed or claimed to be owed by you to the Company under this Agreementor otherwise.

 

4.             Taxes.  All payments and benefits tobe made or provided to you in connection with this Agreement will be subject torequired withholding of federal, state and local income, excise andemployment-related taxes.

 

5.             Notices.  For the purposes of thisAgreement, notices and all other communications provided for in, or requiredunder, this Agreement must be in writing and will be deemed to have been dulygiven when personally delivered or when mailed by United States registered orcertified mail, return receipt requested, postage prepaid and addressed to eachparty’s respective address set forth on the first page of this Agreement(provided that all notices to the Company must be directed to the attention ofthe chair of the Board), or to such other address as either party may havefurnished to the other in writing in accordance with these provisions, exceptthat notice of change of address will be effective only upon receipt.

 

6.             Disputes.  If you so elect, any dispute,controversy or claim arising under or in connection with this Agreement will besettled exclusively by binding arbitration administered by the AmericanArbitration Association in Minneapolis, Minnesota in accordance with theCommercial Arbitration Rules of the American Arbitration Association thenin effect.  Judgment may be entered onthe

 

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arbitrator’s award in anycourt having jurisdiction; provided, that you may seek specific performance ofyour right to receive payment or benefits until the Date of Termination duringthe pendency of any dispute or controversy arising under or in connection withthis Agreement.  The Company will beentitled to seek an injunction or restraining order in a court of competentjurisdiction (within or without the State of Minnesota) to enforce theprovisions of Article V of this Agreement.

 

7.             Jurisdiction. Except as specifically provided otherwise in this Agreement, the partiesagree that any action or proceeding arising under or in connection with this Agreementmust be brought in a court of competent jurisdiction in the State of Minnesota,and hereby consent to the exclusive jurisdiction of said courts for thispurpose and agree not to assert that such courts are an inconvenient forum

 

8.             Related Agreements.  Tothe extent that any provision of any other Plan or agreement between theCompany and you limits, qualifies or is inconsistent with any provision of thisAgreement, then for purposes of this Agreement, while such other Plan oragreement remains in force, the provision of this Agreement will control andsuch provision of such other Plan or agreement will be deemed to have beensuperseded, and to be of no force or effect, as if such other agreement hadbeen formally amended to the extent necessary to accomplish such purpose.  Nothing in this Agreement prevents or limitsyour continuing or future participation in any Plan provided by the Company andfor which you may qualify, and nothing in this Agreement limits or otherwiseaffects the rights you may have under any Plans or other agreements with theCompany.  Amounts which are vestedbenefits or which you are otherwise entitled to receive under any Plan or otheragreement with the Company at or subsequent to the Date of Termination will bepayable in accordance with such Plan or other agreement.

 

9.             No Employment or Service Contract. Nothing in this Agreement is intended to provide you with any right tocontinue in the employ of the Company for any period of specific duration orinterfere with or otherwise restrict in any way your rights or the rights ofthe Company, which rights are hereby expressly reserved by each, to terminateyour employment at any time for any reason or no reason whatsoever, with orwithout cause.

 

10.           Funding and Payment. Benefits payable under this Agreement will be paid only from the generalassets of the Company.  No person has anyright to or interest in any specific assets of the Company by reason of thisAgreement.  To the extent benefits underthis Agreement are not paid when due to any individual, he or she is a generalunsecured creditor of the Company with respect to any amounts due.  The Company with whom you were employedimmediately before your Date of Termination has primary responsibility forbenefits to which you or any other person are entitled pursuant to thisAgreement but to the extent such Company is unable or unwilling to provide suchbenefits, the Company and each other Affiliate are jointly and severallyresponsible therefor to the extent permitted by applicable law.  If you were simultaneously employed by morethan one Company immediately before your Date of Termination, each such Companyhas primary responsibility for a portion of the benefits to which you or anyother person are entitled pursuant to this Agreement that bears the same ratioto the total benefits to which you or such other person are entitled pursuantto this Agreement as your base pay from the Company immediately before yourDate of Termination bears to your aggregate base pay from all such Companies.

 

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11.           Survival.  The respective obligations of,and benefits afforded to, the Company and you which by their express terms orclear intent survive termination of your employment with the Company ortermination of this Agreement, as the case may be, including without limitationthe provisions of Articles III, IV, V and VI and Sections 3, 4, 5 and 6 of Article VIIof this Agreement, will survive termination of your employment with the Companyor termination of this Agreement, as the case may be, and will remain in fullforce and effect according to their terms.

 

**ARTICLEVIII.**

**MISCELLANEOUS**

 

1.             Modification and Waiver.  Noprovision of this Agreement may be modified, waived or discharged unless such modification,waiver or discharge is agreed to in a writing signed by you and the chair ofthe Board. No waiver by any party to this Agreement at any time of any breachby another party to this Agreement of, or of compliance with, any condition orprovision of this Agreement to be performed by such party will be deemed awaiver of similar or dissimilar provisions or conditions at the same or at anyprior or subsequent time. Notwithstanding anything in this Agreement to the contrary, the Companyexpressly reserves the right to amend this Agreement to the extent necessary tocomply with Code Section 409A, as it may be amended from time to time, andthe regulations, notices and other guidance of general applicability issuedthereunder.

 

2.             Entire Agreement.  Noagreements or representations, oral or otherwise, express or implied, withrespect to the subject matter to this Agreement have been made by any partywhich are not expressly set forth in this Agreement.

 

3.             Governing Law.  ThisAgreement and the legal relations among the parties as to all matters,including, without limitation, matters of validity, interpretation,construction, performance and remedies, will be governed by and construedexclusively in accordance with the internal laws of the State of Minnesota(without regard to the conflict of laws principles of any jurisdiction).

 

4.             Headings.  Headings are for purposes ofconvenience only and do not constitute a part of this Agreement.

 

5.             Further Acts.  Theparties to this Agreement agree to perform, or cause to be performed, suchfurther acts and deeds and to execute and deliver or cause to be executed anddelivered, such additional or supplemental documents or instruments as may bereasonably required by the other party to carry into effect the intent andpurpose of this Agreement.

 

6.             Severability.  Theinvalidity or unenforceability of all or any part of any provision of thisAgreement will not affect the validity or enforceability of the remainder ofsuch provision or of any other provision of this Agreement, which will remainin full force and effect.

 

7.             Counterparts.  ThisAgreement may be executed in several counterparts, each of which will be deemedto be an original, but all of which together will constitute one and the sameinstrument.

 

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If this letter correctly sets forth ouragreement on the subject matter discussed above, kindly sign and return to theCompany the enclosed copy of this letter which will then constitute ouragreement on this subject.

 

 

Sincerely,
|   | VITAL IMAGES, INC.                         |
|--------|--------------------------------------------|
|   |                                       |
|   | By:                                        | /s/ Michael H. Carrel |
|   |                                       |
|   | Name:                                      | Michael H. Carrel |
|   |                                       |
|   | Title:                                     | President & CEO |
|   |                                       |
|   | Agreed to this 10th day of December, 2008. |
|   |                                       |
|   |                                       |
|   |    /s/ Reza Ghanbari        |
|   | Dr. Reza A. Ghanbari                  |
|        |                                            |  |  |  |

 

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