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                                                                   EXHIBIT 10.36

                              EMPLOYMENT AGREEMENT

                        QUINTON CARDIOLOGY SYSTEMS, INC.

                                  ATUL JHALANI

                                                    DATED AS OF FEBRUARY 6, 2004

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                              EMPLOYMENT AGREEMENT

      This Amended Employment Agreement (this "Agreement"), dated as of February
6, 2004, is between Quinton Cardiology Systems, Inc. a Delaware corporation
("Employer"), and Atul Jhalani ("Executive");

                              W I T N E S S E T H:

      WHEREAS, Employer desires to continue to retain the services of Executive
upon the terms and conditions set forth herein; and

      WHEREAS, Executive is willing to continue to provide services to Employer
upon the terms and conditions set forth herein.

                              A G R E E M E N T S:

      NOW, THEREFORE, for and in consideration of the foregoing premises and for
other good and valuable consideration, the sufficiency and receipt of which are
hereby acknowledged, Employer and Executive hereby agree to enter into an
employment relationship in accordance with the terms and conditions set forth
below.

1.    EMPLOYMENT

      Employer will continue to employ Executive and Executive will continue to
accept employment by Employer as its Vice-President, Marketing. Executive will
perform the duties of Vice-President, Marketing, and such other duties as may be
assigned from time to time by the Chief Executive Officer, which relate to the
business of Employer and are reasonably consistent with Executive's position.

2.    ATTENTION AND EFFORT

      Executive will devote his full-time efforts to Employer's business and
will serve its interests in good faith to the best of his ability during the
term of this Agreement.

EMPLOYMENT AGREEMENT

                                                                          3/4/05

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3.    COMPENSATION AND BENEFITS

      Employer agrees to pay or cause to be paid to Executive, and Executive
agrees to accept in exchange for the services rendered hereunder by him, the
following compensation:

      3.1   ANNUAL SALARY

      Executive's compensation shall consist of an annual base salary (the
"Annual Salary") of one hundred fifty thousand dollars ($150,000), before all
customary payroll deductions. The Annual Salary shall be reviewed, and shall be
subject to change, by the Board of Directors of Employer (or the Compensation
Committee thereof) at least annually while Executive is employed hereunder.

      3.2   BONUS

      Executive shall be eligible for bonuses in accordance with executive bonus
plans, which shall be adopted and modified from time to time in the sole
discretion of the Board of Directors (or the Compensation Committee of the Board
of Directors) of Employer.

      3.3   BENEFITS

      Executive will be entitled to participate, subject to and in accordance
with applicable eligibility requirements, in such benefit programs as shall be
provided from time to time by action of Employer's Board of Directors, which
shall include, at a minimum, basic health insurance.

      3.4   VACATION

      Executive shall be entitled to four (4) weeks vacation each year, during
which time Executive's compensation will continue in full. The vacation period
may not be carried over from year to year. Vacation will be scheduled by mutual
agreement.

4.    TERMINATION

      The employment of Executive pursuant to this Agreement may be terminated
as follows:

      4.1.  AUTOMATIC TERMINATION ON DEATH OR TOTAL DISABILITY

      This Agreement and Executive's employment hereunder shall terminate
automatically upon the death or total disability of Executive. The term "total

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disability" as used herein shall mean Executive's inability to perform the
duties set forth in Section 1 hereof for a period or periods aggregating ninety
(90) calendar days (or such other period as may be required by law) in any
twelve-month period as a result of physical or mental illness, loss of legal
capacity or any other cause beyond Executive's control, unless Executive is
granted a leave of absence by the Board of Directors of Employer (or the
Compensation Committee thereof). Executive and Employer hereby acknowledge that
Executive's ability to perform the duties specified in paragraph 1 hereof is of
the essence of this Agreement. Termination hereunder shall be deemed to be
effective (a) at the end of the calendar month in which Executive's death occurs
or (b) immediately upon a determination by the Board of Directors of Employer
(or the Compensation Committee thereof) of Executive's total disability, as
defined herein. In the case of termination of employment under this Section 4.1,
Executive shall not be entitled to receive any payments or benefits under this
Agreement other than any unpaid Annual Salary which has accrued as of the date
Executive's employment terminates.

      4.2.  OTHER TERMINATION EXCLUDING CHANGE OF CONTROL

      Either Employer or Executive may terminate this agreement at any time for
any reason, with or without notice. Except as provided in Section 4.3.1 below,
upon such termination, Executive shall not be entitled to receive any payments
or benefits under this Agreement other than any unpaid Annual Salary and
vacation time which has accrued as of the date Executive's employment
terminates.

      Executive acknowledges and understands that his employment with the
Company is at-will and can be terminated by either party for no reason or for
any reason not otherwise specifically prohibited by law or provided for in this
Agreement. Nothing in this Agreement is intended to alter Executive's at-will
employment status or obligate the Company to continue to employ Executive for
any specific period of time, or in any specific role or geographic location.

      4.3.  TERMINATION AS A RESULT OF CHANGE OF CONTROL

            4.3.1. TERMINATION BY SUCCESSOR EMPLOYER

      If (a) during the period commencing on the date Employer enters into a
definitive agreement with respect to a transaction that would constitute a
Change of Control (as defined below) and ending on the date the definitive
agreement therefor is terminated or the Change of Control is consummated,
Employer terminates Executive's employment without cause (as defined below), (b)
during the period commencing upon the consummation of the Change of Control and
ending twenty-

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four months thereafter, Employer or, if applicable, the surviving or successor
employer ("Successor Employer") terminates Executive's employment without Cause
(as defined below), or (c) during the period commencing upon the consummation of
the Change of Control and ending twenty-four (24) months thereafter, Executive
resigns for Good Reason (as defined below), then Executive shall be entitled to
receive the following termination payments and benefits:

            (1) severance payments equal to six (6) months salary, to be paid
      out over six (6) months in the course of Employer's or the Surviving
      Employer's regularly scheduled payroll;

            (2) continuation of health and other benefits, substantially
      equivalent to those in place as of the termination date, for six (6)
      months;

            (3) any unpaid Annual Salary and unused vacation time which has
      accrued as of the date Executive's employment terminates; and

            (4) accelerated vesting of 100% of Executive's then unvested options
      to purchase shares of Employer common stock or the options to purchase
      common stock of the Successor Employer issued in substitution therefor in
      connection with the Change of Control.

      The severance payments and benefits described in this paragraph are
expressly contingent upon Executive's signing upon termination a full release in
a form acceptable to Successor Employer, and are further contingent upon
Executive's full compliance with the terms of the Confidentiality Agreement (as
defined in paragraph 5 below) with Employer.

            4.3.2. TERMINATION FOR CAUSE

      If, during either of the periods set forth in clauses (a) or (b) of
Section 4.3.1, Executive is terminated by Employer or the Successor Employer for
Cause, Executive shall not be entitled to receive any payments or benefits
hereunder other than any unpaid Annual Salary which has accrued as of the date
Executive's employment terminates.

            4.3.3. TERMINATION BY EXECUTIVE

      If, during either of the periods set forth in clauses (a) or (b) of
Section 4.3.1, Executive voluntarily terminates his employment other than for
Good Reason, Executive shall not be entitled to receive any payments or benefits
hereunder other

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than any unpaid Annual Salary which has accrued as of the date Executive's
employment terminates.

            4.3.4. CAUSE

      Wherever reference is made in this Agreement to termination being with or
without Cause, "Cause" shall be limited to the occurrence of one or more of the
following events:

            (a) willful misconduct, insubordination, or dishonesty in the
      performance of Executive's duties or other knowing and material violation
      of Employer's or the Successor Employer's policies and procedures in
      effect from time to time which results in a material adverse effect on
      Employer or the Successor Employer;

            (b) the continued failure of Executive to satisfactorily perform his
      duties after receipt of written notice that identifies the areas in which
      Executive's performance is deficient;

            (c) willful actions (or intentional failures to act) in bad faith by
      Executive with respect to Employer or the Successor Employer that
      materially impair Employer's or the Successor Employer's business,
      goodwill or reputation;

            (d) conviction of Executive of a felony involving an act of
      dishonesty, moral turpitude, deceit or fraud, or the commission of acts
      that could reasonably be expected to result in such a conviction;

            (e) current use by the Executive of illegal substances; or

            (f) any material violation by Executive of Executive's
      Confidentiality Agreement.

            4.3.5. GOOD REASON

            For the purposes of this Agreement, "Good Reason" shall mean that
      Executive, without his/her consent, has either:

            (a) incurred a material reduction in his title, status, authority or
      responsibility at Employer or the Successor Employer; or

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            (b) incurred a reduction in Executive's Annual Salary or bonus
      opportunity;

            (c) suffered a material breach of this Agreement by Employer or the
      Successor Employer which Employer or the Successor Employer does not cure
      within 20 days following written notice from Executive; or

            (d) been required to relocate or travel more than 50 miles from
      his/her then current place of employment in order to continue to perform
      the duties and responsibilities of his/her position (not including
      customary travel as may be required by the nature of his/her position).

            4.3.6. CHANGE OF CONTROL

      For purposes of this Agreement, "Change of Control" means:

            (a) a merger or consolidation of the Company with or into any other
      company, entity or person or

            (b) a sale, lease, exchange or other transfer in one transaction or
      a series of transactions undertaken with a common purpose of all or
      substantially all of Employer's then outstanding securities or all or
      substantially all of Employer's assets; provided, however, that a Change
      of Control shall not include a Related Party Transaction.

      A "Related Party Transaction" means:

            (a) a merger or consolidation of Employer in which the holders of
      the outstanding voting securities of Employer outstanding immediately
      prior to the merger or consolidation hold at least a majority of the
      outstanding voting securities of the surviving or successor entity
      immediately after the merger or consolidation,

            (b) a sale, lease, exchange or other transfer of Employer's assets
      to a majority-owned subsidiary company,

            (c) a transaction undertaken for the principal purpose of
      restructuring the capital of Employer, including but not limited to
      reincorporating Employer in a different jurisdiction, or

            (d) a corporate dissolution or liquidation.

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5.    CONFIDENTIALTY AGREEMENT

      Executive is subject to, and this Employment Agreement is conditioned on
agreement to, the terms of the Non-Disclosure Agreement (the "Confidentiality
Agreement") entered into by Executive and the terms of the Confidentiality
Agreement shall survive the termination of Executive's employment with Employer
or Successor Employer.

6.    ASSIGNMENT

      This Agreement is personal to Executive and shall not be assignable by
Executive. Employer may assign its rights hereunder to (a) any Successor
Employer; (b) any other corporation resulting from any merger, consolidation or
other reorganization to which Employer is a party or (c) any other corporation,
partnership, association or other person to which Employer may transfer all or
substantially all of the assets and business of Employer existing at such time.
All of the terms and provisions of this Agreement shall be binding upon and
shall inure to the benefit of and be enforceable by the parties hereto and their
respective successors and permitted assigns.

7.    ARBITRATION

      Any controversies or claims arising out of or relating to this Agreement
shall be fully and finally settled by arbitration in accordance with the
Employment Arbitration Rules of the American Arbitration Association then in
effect (the "AAA Rules"), conducted by one arbitrator either mutually agreed
upon by Employer and Executive or chosen in accordance with the AAA Rules,
except that the parties thereto shall have any right to discovery as would be
permitted by the Federal Rules of Civil Procedure for a period of 90 days
following the commencement of such arbitration and the arbitrator thereof shall
resolve any dispute which arises in connection with such discovery. The
prevailing party shall be entitled to costs, expenses and reasonable attorneys'
fees, and judgment upon the award rendered by the arbitrator may be entered in
any court having jurisdiction thereof. It is further agreed by the parties that
the venue for any arbitration proceedings shall be within the state of
Washington.

8.    AMENDMENTS IN WRITING

      No amendment, modification, waiver, termination or discharge of any
provision of this Agreement, nor consent to any departure therefrom by either
party hereto, shall in any event be effective unless the same shall be in
writing, specifically identifying this Agreement and the provision intended to
be amended, modified,
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waived, terminated or discharged and signed by Employer and Executive, and each
such amendment, modification, waiver, termination or discharge shall be
effective only in the specific instance and for the specific purpose for which
given. No provision of this Agreement shall be varied, contradicted or explained
by any oral agreement, course of dealing or performance or any other matter not
set forth in an agreement in writing and signed by Employer and Executive.

9.    APPLICABLE LAW

      This Agreement shall in all respects, including all matters of
construction, validity and performance, be governed by, and construed and
enforced in accordance with, the laws of the State of Washington, without regard
to any rules governing conflicts of laws.

10.   ENTIRE AGREEMENT

      This Agreement, on and as of the date hereof, constitutes the entire
agreement between Employer and Executive with respect to the subject matter
hereof and all prior or contemporaneous oral or written communications,
understandings or agreements between Employer and Executive with respect to such
subject matter are hereby superseded.

11.   GOVERNING LAW

      This Agreement shall be interpreted in accordance with and governed by the
laws of the State of Washington.

      IN WITNESS WHEREOF, the parties have executed and entered into this
Agreement on the date set forth above.

                                     EXECUTIVE:

                                     /s/ Atul Jhalani

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                                     QUINTON CARDIOLOGY SYSTEMS, INC.

                                     By: /s/ John R. Hinson

                                     Its: Chief Executive Officer