Exhibit 10.20
**EMPLOYMENT AGREEMENT**
      THIS AGREEMENT made this **31st day of December, 2004**is by and between CABG Medical, Inc., aMinnesota Corporation (the “Company”), and **Manuel A. Villafana**, a resident of the State ofMinnesota (the “Employee”).
      WHEREAS, the parties wish to provide for the employment of the Employee by the Company; and
      WHEREAS, the Company desires reasonable protection of its confidential business and technicalinformation, which has been and will be acquired, and is being developed by the Company, atsubstantial expense.
      NOW, THEREFORE, in consideration of mutual promises contained herein, the Company and theEmployee, each intending to be legally bound, agree as follows:
      1. Employment. Subject to all of the terms and conditions of this Agreement, theCompany agrees to employ the employee as **Chairman of the Board and CEO**and the Employee acceptsthis employment.
      2. Duties. The Employee will make the best use of his/her energy, knowledge andtraining in advancing the Company’s interest. He/she will diligently and conscientiously performthe duties of **Chairman of the Board and CEO**for the Company, as such duties may be defined by theCompany’s Board of Directors and such other tasks as may from time to time be reasonablyrequired to further the growth of the Company. The Employee will make every effort to avoidusing any trade secrets or confidential information that he/she may have in his/her possessionsfrom any previous employer. Employee’s work will be confined to new developments created at theCompany or in the public domain. This will help to avoid any conflict with Employee’s previousemployers.
      3. Term. Unless terminated at an earlier date in accordance with the provisions ofthis Agreement, the term of Employee’s services hereunder shall commence on the date of thisAgreement and shall terminate on 1 April 2008. The Company may terminate the relationships createdby this Agreement upon 60 days notice to Employee if such termination is without cause (as definedbelow), and with no notice if such termination is for cause. If termination is without cause,Employee’s base salary will continue for the entire term of this Agreement as defined in Section4(a) of this Agreement.
      As used in this Agreement, the term “Cause” shall be defined as (i) Employee’s breach of anyof his material duties or obligations under this Agreement, which breach is not corrected within 30days of receipt of written notice thereof by Employee from the Company’s Board of Directors, (ii)embezzlement or other misappropriation of property of the Company, or (iii) conviction of a felonyoffense or gross misdemeanor. No termination of the relationship created by this Agreement shallrelieve Employee of his duties under Sections 5, 6 and 7 hereof.
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Exhibit 10.20
      4. Compensation.
     (a) Salary. The Company shall pay the Employee a salary of **$247,500 annually ($9,519.23 biweekly).**
     (b) Benefits. The Employee will be entitled to participate in benefit planswhich may be established by the Board of Directors of the Company.
     (c) Expenses. The Company, shall reimburse the Employee for all ordinary andnecessary business expenses the Employee incurs while performing his/her duties under thisAgreement, provided that the Employee accounts properly for such expenses to the Company inaccordance with the general corporate policy of the Company as determined by the Company’sBoard of Directors and in accordance with the requirements of Internal Revenue Serviceregulations relating to substantiation of expenses.
     (d) Bonuses. Employee shall be eligible to receive discretionary bonuses inaddition to his base salary as and when determined by the Board of Directors of the Companyduring the term of this Agreement.
      5. Inventions.
     (a) “Inventions,” as used in this Section 5, means any discoveries, designs,improvements or software (whether or not they are in writing or reduced to practice) orworks of authorship (whether or not they can be patented or copyrighted) that the Employeemakes, authors or conceives (ether alone or with others) and that:
     (i) concern directly the Company’s products, research or development;
     (ii) result from any work the Employee performs for the Company; or
     (iii) use the Company’s equipment, facilities, or trade secret information.
     (b) The Employee agrees that all Inventions he/she makes during the term of thisAgreement will be the sole and exclusive property of the Company. The Employee will, withrespect to any such Invention:
     (i) keep current, accurate, and complete records, which will belong to theCompany and be kept and stored on the Company’s premises while the Employee isemployed by the Company;
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Exhibit 10.20
     (ii) promptly and fully disclose the existence and describe the nature of theInvention to the Company and in writing (and without request);
     (iii) assign (and the Employee does hereby assign) to the Company all ofhis/her rights to the Invention, and applications he/she makes for patents orcopyrights in any country, and any patents or copyrights granted to him/her in anycountry; and
     (iv) acknowledge and deliver promptly to the Company any written instruments,and perform any other reasonable acts necessary in the Company’s opinion and at itsexpense to preserve property rights in the Invention against forfeiture,abandonment, or loss and to obtain and maintain letters, patents and/or copyrightson the Invention and to vest the entire right and title to the Invention in theCompany, provided that the Employee makes no warranty or representation to theCompany as to rights against third parties hereunder.
     (c) The requirements of this subsection 5(b) do not apply to an Invention for which noequipment, facility, or trade secret information of the Company was used and which wasdeveloped entirely on the Employee’s own time, and which:
     (i) does not relate directly to the Company’s business or to the Company’sactual research or development; and
     (ii) does not result from any work the Employee performed for the Company.Except as previously disclosed to the Company in writing, the Employee does not haveand will not assert any claims to or rights under any Inventions as having beenmade, conceived, authored, or acquired by the Employee prior to his/her employmenthereunder.
      6. Confidential Information.
     (a) “Confidential Information,” as used in this Section 6, means informationthat is not generally known and that is proprietary to the Company or that the Company isobligated to treat as proprietary. This information includes, without limitation:
     (i) trade secret information about the Company and its products or services;
     (ii) “Inventions,” as defined in subsection 5(a) above;
     (iii) information concerning the Company’s business, as the Company hasconducted it or as it may conduct it in the future; and
     (iv) information concerning any of the Company’s past, current, or possiblefuture products, including (without limitation) information about the
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Exhibit 10.20
     Company’s research, development, engineering, purchasing, manufacturing,servicing, finances, marketing or selling.
Any information that reasonably can be expected to be treated as Confidential Information will bepresumed to be Confidential Information (whether the Employee or other originated it and regardlessof how he/she obtained it).
     (b) Except as required in his/her duties to the Company, the Employee will not, duringhis/her employment and for all times after termination of his/her employment with theCompany, use or disclose Confidential Information to any person not authorized by theCompany to receive it, excluding Confidential Information:
     (i) which becomes publicly available by a source other than the Employee;
     (ii) which is received by the Employee after termination of his/her employmenthereunder from a source who did not obtain the information directly or indirectlyfrom employees or agents of the Company; or
     (iii) for which disclosure thereof the Company has consented in writing. Whenthe Employee’s employment with the Company ends, he/she will promptly turn over tothe Company all records and any compositions, articles, devices, apparatus and otheritems that disclose, describe, or embody Confidential Information including allcopies, reproductions, and specimens of Confidential Information in his/herpossession regardless of who prepared them.
      **7. **Post-employment, Consulting and Competitive Activities. Employee agrees thatduring his employment with the Company and for a minimum period of two (2) years, extendableautomatically up to five (5) years in one (1) year increments unless terminated by the Company witha sixty (60) day notice prior to end of current consulting year, after his employment with theCompany ends:
     (a) He will not alone, or in any capacity with another firm,
          (i) directly or indirectly engage in any commercial activity that is competitive withany of the Company’s business in which Employee participated while he was employed by theCompany or any affiliate thereof, nor will he participate in the management or operation of,or become a significant investor in, any venture or enterprise of whatever kind as aprincipal, officer, director, employee, representative, agent or shareholder of any entitywhose business is the design, development, production, marketing, or servicing of anyproduct or service competitive with the business of the Company as it exists at the time hisemployment with the Company or any affiliate thereof is terminated;
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Exhibit 10.20
          (ii) solicit or in any way interfere or attempt to interfere with the Company’srelationships with any of its current or potential customers; or
          (iii) employ or attempt to employ any of the Company’s employees on behalf of any otherentity competing with the Company provided that, nothing in this Section 7 shall restrictEmployee’s employment by or association with any entity, venture or enterprise which engagesin a business with a product or service competitive with any product or service of theCompany so long as the following conditions are complied with: (A) Employee’s employment orassociation with such entity, venture or enterprise is limited to work which does notinvolve or relate to the design, development, production, marketing or servicing of aproduct or service which is directly competitive with any product or service of the company;and (B) Employee takes reasonable measures to ensure that his employer does not involveEmployee with or consults Employee in any aspect of the design, development, production,marketing or servicing or such competitive product or service and, provided further, that ifthe Company is purchased or acquired in a merger or similar transaction, the provisions ofthis Section 7(a) shall apply only to Employee’s engaging in activities competitive with thebusiness in which the Company was engaged prior to any such purchase or merger and suchprovisions shall not be deemed to prohibit Employee from competing with any other aspects ofthe business of any purchasing or acquiring person.
     (b) He will, prior to accepting employment with any new employer, inform that employerof this Agreement and provide that employer with a copy of Section 7 of this Agreement,provided that he reasonably believes this new position is or may be contrary to thisAgreement.
     (c) To compensate for the restrictions and consulting contained in this Section 7, theCompany will make a monthly payment to Employee commencing with the first month aftertermination of employment and continuing until such restrictions expire. The amount paidshall be Employee’s monthly base salary at the time of any termination of Employee’semployment with the Company adjusted annually to the CPI index. During the course of thisAgreement, Employee shall remain a participant in the Company’s medical benefits plan whichpremiums are paid by the Company except for the contribution required of theemployee/consultant, which shall remain Employee’s responsibility. Employee hereby agreesto accept such payment, and acknowledges that such payment, as well as other considerationreceived in the course of his employment, is sufficient consideration for the restrictionscontained in this Section 7. Employee agrees that upon acceptance of such payment, theCompany shall have no further liability to Employee and such payment shall, subject to thelimitation described below, constitute a release by Employee of all claims and liabilitiesagainst the Company arising from this employment. The Company agrees that it shall make agood faith effort to settle any employment-related claims by Employee prior to making thefirst payment due under this Section 7(c).
     (d) He will consult on non-confidential Company matters with the Board of Directors attheir request on a limited time basis not to exceed 20 hours per month.
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Exhibit 10.20
      8. Conflicting Business. Unless prior written approval is obtained from the Company’sBoard of Directors or an appropriate committee of the Board, the Employee agrees that he/she willnot transact business with the Company personally, or as agent, owner, partner, or shareholder ofany other entity. The Employee further agrees that he/she will not engage in any business activityor outside employment that may be in conflict with the Company’s proprietary or business interests.
      9. No Adequate Remedy. The Employee understands that if he/she fails to fulfillhis/her obligations under Sections 5, 6, 7 or 8 of this Agreement, the damages to the Company wouldbe very difficult to determine. Therefore, in addition to any other rights or remedies availableto the Company at law, in equity or by statute, the Employee hereby consents to the specificenforcement of Sections 5, 6, 7 or 8 of this Agreement by the Company through an injunction orrestraining order issued by any appropriate court.
      10. Miscellaneous.
     (a) Successors and Assigns. This Agreement may not be assigned by theEmployee, except as provided in the next sentence. This Agreement may not be assigned bythe Company without the Employee’s consent, which consent shall not be unreasonablywithheld. In any event, the Company may assign this Agreement without the consent of theEmployee in connection with a merger, consolidation, assignment, sale or other dispositionof substantially all of its assets or business or the assets or business of a division ofthe Company.
     (b) Modification. This Agreement may be modified or amended only by a writingsigned by each of the parties hereto.
     (c) Governing Law. The laws of the State of Minnesota shall govern thevalidity, construction, and performance of this Agreement.
     (d) Construction. Wherever possible, each provision of this Agreement shall beinterpreted so that it is valid under applicable law. If any provision of this Agreement isto any extent invalid under applicable law in any jurisdiction, that provision shall stillbe effective to the extent it remains valid. The remainder of this Agreement also shallcontinue to be valid, and the entire Agreement shall continue to be valid in otherjurisdictions.
     (e) Non-Waiver. No failure or delay by any of the parties hereto in exercisingany right or remedy under this Agreement shall waive any provision of this Agreement. Anysingle or partial exercise by either of the parties hereto of any right or remedy under thisAgreement shall not preclude the party from otherwise or further exercising its rights orremedies, or any other rights or remedies granted by any law or any related document.
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Exhibit 10.20
     (f) Captions. The headings in this Agreement are for convenience only andshall not affect the interpretation of this Agreement.
     (g) Notices. All notices and other communications required or permitted underthis Agreement shall be in writing and hand delivered or sent by registered first-classmail, postage prepaid. Such notices and other communication shall be effective upon receiptif hand delivered and shall be effective five (5) business days after mailing if sent bymail to the following addresses, or such other addresses as either party shall have notifiedthe other party:
If to the Company:
CABG Medical, Inc.