EXHIBIT 10.2


 


April 6, 2006


 


Mr. John H. Jungbauer


VP, Finance and CFO


MedicalCV, Inc.


9725 South Robert Trail


Inver Grove Heights, MN 55077


 


Re:                             Amendment to Executive Employment Agreement


 


Dear Mr. Jungbauer:


 


Reference is made to your
Executive Employment Agreement with MedicalCV, Inc. (“MedCV” or “we”) dated
August 8, 2005 (the “Employment Agreement”) providing for your employment as
Vice President, Finance and Chief Financial Officer of MedCV. Following our
discussions concerning the future needs of MedCV as we enter into a new stage
of growth, we have reached a mutual decision concerning your departure from
MedCV. This letter (the ”Agreement”) will address amendments to the
Employment Agreement and your severance and transition arrangements. Except as provided
in this letter, the following supersedes all other existing arrangements for
your employment, compensation and benefits.


 


1.                                       Termination
and Duties.  Section 3.01 of the Employment Agreement is hereby
amended and superseded by the following. In lieu of further notice of
termination of employment by you or MedCV, it is agreed that, except as
provided below, your employment by MedCV will terminate on the date we advise
you that MedCV has engaged a new chief financial officer and/or principal
accounting officer (the “Termination Date”). We agree, however, that the actual
date of termination of your employment shall not be earlier than July 31, 2006.
On the date we engage a new chief financial officer or principal accounting
officer, you will be deemed to have resigned from all offices held by you with
MedCV. If we advise you that we have engaged a new chief financial officer
and/or principal accounting officer, you agree that we will also have the
right, at our option, to extend your employment (as a non-officer)  through a transition period which we specify
in writing, but which shall not continue beyond December 31, 2006, without your
consent.. During such transition period, you agree to assist MedCV and such
officer as needed in all matters pertaining to accounting and SEC reporting
matters. Until the Termination Date, you agree to continue to serve as MedCV’s
Vice President, Finance and Chief Financial Officer and will be charged with
primary responsibility for coordinating MedCV’s accounting and SEC filings. You
and your staff will diligently complete and close MedCV’s accounting for the
year ending April 30, 2006; will work with company officers, auditors and legal
counsel to prepare and timely file MedCV’s 10-KSB report for such fiscal year;
and will sign such 10-KSB and all appropriate certifications thereto. The
forgoing is a condition to the payment of the severance payment to you provided
in Paragraph 3.


 


2.                                       Compensation.  Your
base compensation and benefits will continue to be paid to you under the terms
of your Employment Agreement at their current rates through the Termination
Date and any transition period. Except for the severance payment provided
below, however, no other bonus or


 

















 


monetary
compensation will be paid to you. The foregoing supersedes Sections 4.01, 4.02
and 6.01 of the Employment Agreement.


 


3.                                       Special
Severance Payment.  Under the terms of the Employment Agreement,
you have the right to terminate your employment upon 60 days prior notice and
are entitled to a severance payment equal to six months of your base
compensation. We desire to have a smooth transition of your duties to a new
chief financial officer. Therefore, conditioned upon your performance of this
Agreement, MedCV will pay an additional severance amount equal to $100,000. The
severance amounts hereunder shall be payable $100,000 (under your Employment
Agreement) on the Termination Date, and the special payment ($100,000) on
January 2, 2007. MedCV will also pay you the severance benefits provided in
Section 7.01(a) and (b) of the Employment Agreement. All amounts payable to you
will be reduced by applicable withholdings.


 


4.                                       Amendment
to Stock Option.  Your current stock options for the purchase of
1,440,131 shares of MedCV Common Stock provide that you have three months
following termination of employment to exercise the vested portions thereof.
Approximately 440,666 will be vested as of July 1, 2006. In consideration of
your agreements contained in this letter, it is agreed that your stock option
agreements will be amended, effective upon your execution of this Agreement, to
provide that your options, to the extent vested upon termination of your
employment, will be exercisable for a period of twelve months following the
termination of your employment. If required by any underwriter or agent in
connection with the sale of our securities, during such 12-month period, you
agree to abide by and enter into any form of share lock-up agreement that is
entered into by any other executive officer of MedCV. In the event you enter
into such lock-up agreement, the exercise period of your options will be
extended for at least 90 days following the termination of any lock-up period
to enable you to exercise your option.


 


5.                                       Revocation.  You
have twenty-one (21) days from the date you receive this Agreement to consider
whether to sign this Agreement (not including the day you receive it), and are
advised in writing by this paragraph to consult an attorney as part of the
consideration process. The 21-day consideration period thus expires at the end
of the day on April 28, 2006. If you sign this Agreement before the expiration
of the 21-day period, you do so because you do not need additional time beyond
the signature date to decide whether to enter into this Agreement. You
acknowledge that once you execute this Agreement, you may, if you choose,
revoke the Agreement within fifteen (15) days after the date on which you
signed it. (The parties hereto agree that this 15-day revocation period
includes, and is not in addition to, the seven-day consideration period
required by the Age Discrimination in Employment Act.)  If you choose to revoke, written notice of
revocation must be delivered either in person, or mailed by certified mail,
return receipt requested, and properly addressed to:


 


Marc P. Flores


President and Chief Executive Officer


MedicalCV, Inc.


9725 South Robert Trail


Inver Grove Heights, MN 55077


 


If mailed, the written notice of revocation must be postmarked within
the 15-day period. If you do not timely revoke your execution of this
Agreement, then the sixteenth day following the date of your execution will be
the “Effective Date” of this Agreement. By executing this Agreement, you
represent that you understand the terms and effect of this Agreement and enter
into it willingly, knowingly, and voluntarily.


 


6.                                       Release.  You,
on behalf of yourself, your heirs, successors, agents, assigns, and all other
persons who could assert a claim based on a relationship with you and/or
dealings with MedCV, waive


 


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and
release and promise never to assert any or all claims that exist or might exist
against MedCV, its related business entities, and their current and former
shareholders, directors, officers, employees, agents, attorneys, insurers, and
assigns, prior to the your signing of this Agreement. These claims include, but
are not limited to, claims arising under federal, state or local statutes,
ordinances, regulations, rules, or common law, including but not limited to the
following (as amended): Title VII of the Civil Rights Act of 1964; the Civil
Rights Act of 1991; the Americans with Disabilities Act; the Age Discrimination
in Employment Act; the Family Medical Leave Act; the Employee Retirement Income
Security Act; any state statute or law governing employment, discrimination, or
harassment in employment or governing termination of employment, including but
not limited to the Minnesota Human Rights Act, or similar state statutes or
local ordinances; the law of contract and tort including but not limited to
claims for defamation, fraud or misrepresentation, breach of privacy, assault,
battery, intentional or negligent infliction of emotional distress, promissory
estoppel, or any quasi-contractual theory or any other theory arising under the
common law; and any claims for attorney’s fees, costs, or disbursements, or any
action in equity, all to the fullest extent permitted by law. You represent and
warrant that you have not assigned any such claims to anyone else. You further
agree to the extent permitted by law not to sue or commence any other legal or
equitable actions against MedCV, except to enforce this Agreement. You
acknowledge and agree that this Agreement, including the extension of the
exercise period of your options and the special severance payment to you
provided in Paragraph 3, provided herein constitutes a fair, sufficient, and
adequate consideration for promises in this Agreement.


 


MedCV hereby releases you
from all claims, liabilities or causes of action (collectively, “Claims”) known
to MedCV on the date hereof; provided, however, that your release shall not
apply to Claims (i) arising out of the enforcement of this Agreement or your
Employment Agreement; or (ii) arising from claims made by third parties.


 


7.                                       Litigation
Support.  Within the forty-eight (48) month period following the
Termination Date, you will comply with any reasonable request by MedCV or its
attorneys to assist in connection with pending or future litigation or charges
involving MedCV, including but not limited to matters involving any past or
present agent or employee of MedCV, involving another business entity, or
involving any other MedCV-affiliated entity, parent, or successor. MedCV will
reimburse you for all reasonable, out-of-pocket expenses incurred in providing
such assistance. If you are requested to perform services in excess of eighty
(80) hours during such period, MedCV will reimburse you at the rate of $100.00
per hour.


 


8.                                       Miscellaneous.  This
Agreement and the documents it references constitute the entire agreement
between you and MedCV with respect to the matters covered and except for the
last sentence of this paragraph, supersedes all prior and contemporaneous
agreements, representations, and understandings of the parties with respect to
the subject matter of this Agreement, including but not limited to any
previously-existing contract, agreement, understanding, practice, or policy
(oral or written) relating to separation or severance pay in the event of
termination of employment, except that the benefit plans that you participate
in shall remain in full force and effect for as long as you participate in any
such benefit plan. Except as provided in this Agreement, the remaining
provisions of your Employment Agreement not inconsistent with this Agreement
will remain in effect in accordance with their terms.


 


If any provision of this
Agreement is held to be void, voidable, unlawful, or unenforceable, the
remaining portions of this Agreement will continue in full force and effect.
Notwithstanding the foregoing, if your releases of claims set forth in
Paragraph 6 are held to be invalid or unenforceable, then at its option, MedCV
may declare the Agreement null and void and recover from you the payments and
benefits provided under Section 3 above.


 


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  MEDICALCV, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marc P. Flores

  	
   

  
	
   

  	
   

  	
  Marc P. Flores

  
	
   

  	
   

  	
  President and Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ John H. Jungbauer

  	
   

  
	
   

  	
  John H. Jungbauer

  
					



 


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