exhibit10_1.htm


    EXHIBIT
      10.1

     

    EMPLOYMENT
      AGREEMENT

     

    This
      Employment Agreement (“Agreement”) is made by and between Analysts International
      Corporation (the “Company”) with headquarters at 3601 W. 76th
      Street,
      Minneapolis, MN 55435 and Robert E. Woods (“Executive”).

     

    RECITALS

     

    WHEREAS,
      the Company desires to retain Executive as an Employee of the Company, and
      Executive desires to be so employed.

     

    NOW,
      THEREFORE, in consideration of the mutual promises and agreements set forth
      herein, and for other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, the Company and Executive hereby
      agree as follows:

     

    In
      consideration for the mutual promises contained herein, the parties, intending
      to be legally bound, agree as follows:

     

    AGREEMENT

     

    1. Terms
      of
      Employment.

     

    
      	
              1.1  

            	
              Commencement
                Date.  This Agreement is effective as of January 1, 2008
                (the “Commencement Date”).

            


    

     

    
      	
              1.2  

            	
              Position.  The
                Company will employ Executive in the capacity of Senior Vice President,
                General Counsel and Secretary, reporting to the Company’s
                CEO.

            


    

     

    
      	
              1.3  

            	
              Best
                Efforts.  During Executive’s employment by the Company,
                Executive agrees to devote his full time and best efforts to the
                interests
                of the Company and to refrain from engaging in other employment or
                in any
                activities that may be in conflict with the best interests of the
                Company.  Executive agrees to perform his duties to a level
                consistent with the highest standards of one holding such position
                in
                similar businesses or enterprises.  Executive agrees not to
                render services to anyone other than the Company (or its parent or
                subsidiaries) for compensation as an employee, consultant, or otherwise
                during the term of this Agreement.

            


    

     

    
      	
              1.4  

            	
              Personal
                Activities.  The provisions of Sections 1.2 and 1.3 of
                this Agreement will not be deemed to prohibit Executive from devoting
                reasonable time to personal
                matters.

            


    

     

    2. Term
      of
      Employment.

     

    
      	
              2.1  

            	
              Duration.  Subject
                to the provisions for termination set forth in Sections 6, 7 and
                8 below,
                the Original Term of this Agreement (“Original Term”) will commence upon
                the 1st day of January, 2008 and will continue to and include the
                31st
                day of October, 2010.

            


    

     

    
      	
              2.2  

            	
              Extension
                of
                Provisions.  At the end of the Original Term, the
                provisions of the Agreement will automatically renew for an additional
                one
                (1) year term (“Additional Term”) commencing November 1, 2010, unless
                either party gives notice of non­renewal at least ninety (90) days
                before the scheduled expiration of the term.  At the end of any
                Additional Term, the provisions of the Agreement will automatically
                renew
                for an Additional Term, unless either party gives notice of non-renewal
                at
                least ninety (90) days before the scheduled expiration of the
                term.

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3. Compensation
      and
      Benefits.

     

    
      	
              3.1  

            	
              Salary.  For
                all services rendered by Executive pursuant to this Agreement, the
                Company
                will pay Executive an annual base salary (“Base Compensation”) equal to
                $250,000.  Payment will occur at regular payroll intervals in
                accordance with the Company’s standard payroll practices.  The
                Company’s CEO and compensation committee of the Board or the Board itself
                will review the Executive’s compensation annually and, in its sole
                discretion, may determine to increase such base salary for the following
                year but cannot decrease the annual salary below
                $250,000.

            


    

     

    
      	
              3.2  

            	
              Incentive
                Compensation.  In addition to Executive’s Base
                Compensation, Executive will be eligible to earn additional cash
                incentive
                compensation of between 30% and 50% of Base Compensation in each
                year of
                employment during the Original Term or any Additional Term (“Incentive
                Compensation”).  The potential Incentive Compensation will be
                determined annually by the Company’s CEO and compensation committee of the
                Board and shall be contingent upon the Company and Executive meeting
                company and individual performance objectives (“Performance Objectives”)
                determined by the Company’s CEO and the compensation
                committee.  The Company’s CEO and the compensation committee
                will consider Executive’s input in setting the annual Performance
                Objectives.

            


    

     

    
      	
              3.3  

            	
              Long-term
                Incentive
                Compensation.  In addition, Executive shall be eligible
                to be awarded stock options or restricted shares from the Company’s stock
                option and equity incentive plans at the sole discretion of the
                compensation committee.

            


    

     

    
      	
              3.4  

            	
              Stock
                Options.  On or about January 1, 2008, Executive will be
                granted options to purchase 250,000 shares of the Company’s common stock
                with one-quarter being vested immediately and the remainder vesting
                in
                even increments over three years from the date of the
                grant.

            


    

     

    Such
      options shall be incentive stock options to the extent that such options qualify
      as incentive stock options as defined in Internal Revenue Code Section
      422.  The Company may issue such options from the plans as it deems
      appropriate but to the extent possible shall issue the options as incentive
      stock options.  The stock option agreement shall provide that in the
      event of a Change of Control on or after May 1, 2009, any options remaining
      unvested at the time of the Change of Control shall vest
      immediately.  For purposes of this Section 3.4, “Change of Control”
shall have the same meaning as set forth in Exhibit A. Executive shall sign
      an
      option agreement or agreements containing the terms for the options outlined
      herein and such other terms and conditions required of similarly situated
      executives by the Company as determined by the Board or the compensation
      committee of the Board.

     

    
      	
              3.5  

            	
              Deferred
                Compensation
                Plan.  Executive will be entitled to participate in the
                Company’s Deferred Compensation Plan (the “Special Executive Retirement
                Plan” or “SERP”) at a participation rate of 15% of Base
                Compensation.

            


    

     

    
      	
              3.6  

            	
              Fringe
                Benefits.  Executive will be entitled to participate in
                the Company’s standard benefit programs, on the same terms as other senior
                executives of the Company.  Notwithstanding the foregoing, the
                Company will also provide Executive the
                following:

            


    

     

    3.6.1 Medical
      Insurance
      Costs.  The Company will provide health insurance coverage for
      Executive, Executive’s spouse, and Executive’s children (up to the maximum age
      allowed by the Company’s plan, provided they meet the terms of eligibility for
      participation in the plan).

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    3.6.2 Paid
      Time
      Off.  Executive shall be entitled to paid time off at his
      discretion and as business conditions warrant.  If necessary due to
      business conditions of the Company, Executive agrees to obtain concurrence
      from
      the CEO prior to taking the paid time off.

     

    3.6.3 Paid
      Parking.  The Company will provide Executive with a paid
      indoor, underground parking spot, if available, at the Company’s office building
      presently located at 3601 West 76”‘ Street, Minneapolis, Minnesota
      55435.

     

    3.6.4 Business
      Expenses.  Executive will be entitled to reimbursement of all
      reasonable, business-related travel and other expenses incurred by Executive
      in
      the ordinary course of business on behalf of the Company, so long as such
      expenses are incurred, documented and authorized pursuant to the Company’s
      expense reimbursement policies.

     

    4. Insurance
      Policies.

     

    The
      Company will keep all Directors and Officers insurance policies and law
      department malpractice policies current and identify Executive, if appropriate,
      on all such policies.

     

    5. Location.

     

    Executive
      will provide his services in the Minneapolis, Minnesota
      area.  Notwithstanding the foregoing, the parties recognize and
      acknowledge that Executive may be required to spend considerable business time
      in locations other than the Minneapolis, Minnesota area.

     


    
      
        
          
            


          

           

        

        
        

      

      
        3

        
          

        

      

      
        
        

      

    


     

    6. Termination
      of Employment by
      the Company.

     

    
      	
              6.1  

            	
              For
                Cause.  For purposes of this Agreement, the Company will
                have the right to terminate Executive’s employment for
                Cause.  For purposes of this Agreement, “Cause” shall
                mean:

            


    

     

    6.1.1 Executive’s
      substantial failure or neglect, or refusal to perform, the duties and
      responsibilities of Executive’s position and/or the reasonable direction of the
      CEO;

     

    6.1.2 The
      commission by Executive of any willful, intentional or wrongful act that has
      the
      effect of materially injuring the reputation, business or performance of the
      Company;

     

    6.1.3 Executive’s
      conviction of, or Executive’s guilty or nolo contendere plea with respect to,
      any crime punishable as a felony;

     

    6.1.4 Executive’s
      conviction of, or Executive’s guilty or nolo contendere plea with respect to,
      any crime involving moral turpitude; or

     

    6.1.5 Any
      bar
      against Executive from serving as a director, officer or executive of any firm
      the securities of which are publicly-traded.

     

    
      	
               

            	
              For
                purposes of this Section 6.1, an act or failure to act by Executive
                shall
                not be “willful” unless it is done, or omitted to be done, in bad faith
                and without any reasonable belief that Executive’s action or omission was
                in the best interests of the Company.


            


    

     

    
      	
              6.2  

            	
              Inability
                to
                Perform.  For purposes of this Agreement, the Company
                will have the right to terminate Executive’s employment upon the
                occurrence of any of the following events (“Inability to
                Perform”):

            


    

     

    6.2.1 Executive
      becomes disabled for a period of at least ninety (90) days to the extent that,
      in the determination of the CEO, he is no longer able to report to work and
      to
      carry on his duties on behalf of the Company; or

     

    6.2.2 Executive
      dies.

     

    
      	
              6.3  

            	
              Notice.  In
                the event that the CEO determines that Cause for termination exists,
                the
                CEO shall deliver to Executive written notice that an event of Cause
                has
                occurred after which Executive shall have fifteen (15) days to cure
                such
                event of Cause to the reasonable satisfaction of the
                CEO.

            


    

     

    
      	
              6.4  

            	
              Termination
                for
                Cause/Inability to Perform.  The Company may terminate
                Executive’s employment at any time for Cause as defined within this
                Agreement after giving Executive the notice and Executive’s failure to
                cure pursuant to Section 6.3 above and in any such case will have
                no
                further obligation or liability to Executive.  Likewise, if the
                Company terminates Executive for Inability to Perform, the Company
                will
                have no further obligation or liability to
                Executive.

            


    

     

    
      	
              6.5  

            	
              Termination
                Without
                Cause.  Executive’s employment during the Original Term
                or any Additional Term may be terminated by the Company without Cause
                upon
                thirty (30) days’ notice.  If the Company terminates Executive’s
                employment without Cause during the Original Term or during any Additional
                Term, Executive will continue to receive Base Compensation for a
                period of
                twelve (12) months, provided that Executive signs all appropriate
                paperwork, including providing a full release of all claims to the
                Company, in a form acceptable to the Company.  The Company will
                also reimburse Executive for medical insurance premium payments made
                under
                the Consolidated Omnibus Reconciliation Act (“COBRA”), for a period of up
                to six (6) months following the date of termination, provided that
                the
                Company receives sufficient evidence of proof of such payments during
                the
                COBRA period.  For purposes of this Section 6.5, termination of
                Executive’s employment due to nonrenewal of Executive’s employment
                agreement at the end of the Original Term or any Additional Term,
                shall be
                deemed a termination without Cause and entitle Executive to the payments
                and benefits set forth in this Section
                6.5.

            


    


    
      
        
          
             

          

        

        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    7. Termination
      of Employment by
      Executive.

     

    
      	
              7.1  

            	
              Resignation
                for Good
                Reason.  If Executive believes Good Reason to resign
                exists, before resigning, he must first give the Company written
                notice of
                the alleged Good Reason and an opportunity to cure within fifteen
                (15)
                days of notice.  If Executive resigns from his employment for
                Good Reason, he will continue to receive Base Compensation for a
                period of
                twelve (12) months, provided that Executive signs all appropriate
                paperwork, including providing a full release of all claims to the
                Company, in a form acceptable to the Company.  The Company will
                also reimburse Executive for all medical insurance premium payments,
                made
                under COBRA, for a period of up to six (6) months following the date
                of
                resignation for Good Reason, provided that the Company receives sufficient
                evidence of proof of such payments during the COBRA
                period.

            


    

     

    For
      purposes of this Section 7.1, “Good Reason” will mean a good faith determination
      by Executive, communicated in writing to the CEO, that any one or more of the
      following events has occurred:

     

    7.1.1 a
      reduction in Executive’s Base Salary below $250,000;

     

    7.1.2 a
      requirement imposed on Executive that results in Executive being based at a
      location that is outside of a fifty (50) mile radius of Executive’s job location
      immediately prior to the change in location;

     

    7.1.3 any
      material breach or unilateral and material change in assignment or job title,
      but not including a change in Executive’s reporting structure in the event of a
      Change in Control.

     

    
      	
              7.2  

            	
              Notice.  If
                Executive terminates his employment for Good Reason, he must provide
                thirty (30) days’ prior written notice to the
                Company.

            


    

     

    
      	
              7.3  

            	
              Resignation
                without
                Good Reason.  If Executive resigns from his employment
                [or elects not to renew the Agreement upon its expiration] without
                Good
                Reason, the Company will have no further obligation or liability
                to
                Executive.

            


    

     

    8. Delay
      of
      Payment.

     

    Notwithstanding
      anything to the contrary, to the extent that Executive is a “key employee”
pursuant to the provisions of Section 409A of the Internal Revenue Code as
      of
      the date that any severance benefits or other deferred compensation becomes
      payable to the Executive hereunder, and such severance benefits are required
      to
      be delayed until the date six months following Executive’s termination of
      employment in order to avoid additional tax under Section 409A of the Code
      (taking account of all applicable authorities thereunder), payment and provision
      of such severance benefits shall be delayed until the date six months after
      Executive’s termination of employment.

     

    9. Intellectual
      Property
      Rights.

     

    
      	
              9.1  

            	
              Non-infringement.  Executive
                agrees that all work products created or produced by Executive during
                the
                course of his employment with the Company will be Executive’s original
                work and will not infringe upon or violate any patent, copyright,
                trade
                secret, contractual or other proprietary right of any third
                party.

            


    

     

    
      	
              9.2  

            	
              Disclosure.  Executive
                agrees to disclose and describe to the Company, on a timely basis,
                all
                works of authorship, inventions and all other intellectual property
                that
                Executive may solely or jointly discover, conceive, create, develop,
                produce or reduce to practice while employed by the Company (“Company
                Inventions”).

            


    

     

    
      	
              9.3  

            	
              Assignment.  Executive
                hereby assigns and agrees to assign to the Company, or its designee,
                Executive’s entire right, title, and interest in and to all Company
                Inventions.  Executive represents that the Company’s rights in
                all such Company Inventions will be free and clear of any encumbrances,
                liens, claims, judgments, causes of action or other legal rights
                or
                impediments.

            


    

     

    
      	
              9.4  

            	
              Independent
                Development.  NOTICE: Pursuant to Minnesota Statutes §
                181.78, Executive is hereby notified that the foregoing agreement
                does not
                apply to an invention for which no equipment, supplies, facility
                or trade
                secret information of the Company was used and which was developed
                entirely on the employee’s own time, and (1) which does not relate (a)
                directly to the business of the Company (or its Client) or (b) to
                the
                Company’s (or its Client’s) actual or demonstrably anticipated research or
                development, or (2) which does not result from any work performed
                by the
                employee for the Company or its
                Client.

            


    

     

    
      	
              9.5  

            	
              “Works
                for
                Hire.  Executive acknowledges and agrees that all
                original works of authorship which are made by Executive (solely
                or
                jointly with others) within the scope of his employment and which
                are
                protectable by copyrights, are “works made for hire” as that term is
                defined in the United States Copyright Act (17 U.S.C. § 101) and that, as
                such, all rights comprising copyright under the United States Copyright
                laws will vest solely and exclusively in his employer, the
                Company.  Executive hereby irrevocably and unconditionally
                waives all so-called moral rights that may vest in Executive (whether
                before, on or after the date hereof) in connection with Executive’s
                authorship of any copyright works in the course of his employment
                with the
                Company, wherever in the world enforceable, including without limitation
                the right to be identified as the author of any such works and the
                right
                of integrity (i.e., not to have any such works subjected to derogatory
                treatment), and Executive agrees never to assert any such moral rights
                with respect to any Company
                Invention.

            


    

     

    
      	
              9.6  

            	
              Enforcement;
                Cooperation.  Executive agrees to perform, during and
                after his employment, all acts deemed necessary or desirable by the
                Company to permit and assist it, at its expense, in obtaining and
                enforcing the full benefits, enjoyment, rights and title throughout
                the
                world in the Company Inventions hereby assigned to the
                Company.  Such acts may include, but are not limited to,
                execution of documents and assistance or cooperation in the registration
                and enforcement of applicable patents, copyrights, maskworks or other
                legal proceedings.

            


    

    
       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

    

    
      	
              9.7  

            	
              Attorney
                in
                Fact.  In the event that the Company is unable for any
                reason, whether during or after Executive’s employment by the Company, to
                secure Executive’s signature to any document required to apply for or
                execute any patent, design rights, registered designs, trademarks,
                copyright, maskwork or other applications with respect to any Company
                Inventions (including improvements, renewals, extensions, continuations,
                divisions or continuations in part thereof), Executive hereby irrevocably
                designates and appoints the Company and its duly authorized officers
                and
                agents as Executive’s agents and attorneys-in-fact to act for and on his
                behalf and instead of Executive, to execute and file any such application
                and to do all other lawfully permitted acts to further the prosecution
                and
                issuance of patents, copyrights, maskworks or other rights thereon
                with
                the same legal force and effect as if executed by
                Executive.

            


    

     

    10. Confidentiality.

     

    
      	
              10.1  

            	
              Confidential
                Nature of
                Relationship.  Executive acknowledges that his employment
                by the Company creates a relationship of confidence and trust with
                respect
                to Confidential Information (as hereinafter defined).  During
                the course of his employment with the Company, the Company agrees
                to
                provide Executive with access to Confidential
                Information.  Executive expressly undertakes to retain in strict
                confidence all Confidential Information transmitted or disclosed
                to
                Executive by the Company or the Company’s clients, and will never make any
                use of such information except as (and then, only to the extent)
                required
                to perform Executive’s employment duties for the
                Company.  Executive will take such protective measures as may be
                reasonably necessary to preserve the secrecy and interest of the
                Company
                in the Confidential Information.  If Executive becomes aware of
                any unauthorized use or disclosure of Confidential Information by
                any
                person or entity, Executive will promptly and fully advise the Company
                of
                all facts known to Executive concerning such unauthorized use or
                disclosure.

            


    

     

    
      	
              10.2  

            	
              Definition.  “Confidential
                Information” means all commercially sensitive information and data, in
                their broadest context, originated by, on behalf of or within the
                knowledge or possession of the Company or its clients (including
                any
                subsidiary, division or legal affiliate thereof).  Without in
                any way limiting the foregoing, Confidential Information includes,
                but is
                not limited to: information that has been designated as proprietary
                and/or
                confidential; information constituting trade secrets; information
                of a
                confidential nature that, by the nature of the circumstances surrounding
                the disclosure, should in good faith be treated as proprietary and/or
                confidential; and information and data conceived, discovered or developed
                in whole or in part by Executive while employed by the Company.
                Confidential Information also includes information of a confidential
                nature relating to the Company’s securities clients, prospective clients,
                strategic business relationships, products, services, suppliers,
                personnel, pricing, recruiting strategies, job candidate information,
                employee information, sales strategies, technology, methods, processes,
                research, development, systems, techniques, finances, accounting,
                purchasing and business plans.

            


    

     

    
      	
              10.3  

            	
              Exclusions.  Confidential
                Information does not include information which: (A) is generic; (B)
                is or
                becomes part of the public domain through no act or omission of Executive;
                (C) was in Executive’s lawful possession prior to the disclosure and was
                not obtained by Executive in breach, either directly or indirectly,
                of any
                obligation to the Company or any client of the Company’s; (D) is lawfully
                disclosed to Executive by a third party without restriction on disclosure;
                or (E) is independently developed by Executive using his own resources,
                entirely on his own time, and without the use of any Confidential
                Information.

            


    

     

    
      	
              10.4  

            	
              Protected
                Health
                Information.  If during the course of his employment with
                the Company, Executive receives any “protected health information,” as
                that term is defined in 45 CFR, Part 164, Subpart E (“Privacy of
                Individually Identifiable Health Information”): (A) Executive agrees to
                maintain all such information in strict confidence with the Health
                Insurance Portability and Accountability Act of 1996 (HIPAA); (B)
                Executive agrees that he will make no use whatsoever of any such
                information except as required to perform Executive’s employment duties;
                and (C) Executive agrees that he will never record, store, file or
                otherwise maintain, in any computer or other storage device owned
                by the
                Company or by Executive, any “protected health information.” Executive
                agrees to alert the Company promptly if he becomes aware of any misuse
                or
                unauthorized disclosure of any such
                information.

            


    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    
      	
              10.5  

            	
              Additional
                Confidentiality Agreements.  Executive agrees to execute
                such additional non-disclosure and confidentiality agreements as
                the
                Company or its clients may from time to time
                request.

            


    

     

    11. Use
      of Confidential or
      Material Non-Public Information; Codes of Conduct.

     

    
      	
              11.1  

            	
              Confidential
                or
                Material, Non-Public Information.  Executive acknowledges
                that he is prohibited from using or sharing any Confidential Information
                for personal gain or advantage (securities transactions or otherwise),
                or
                for the personal gain or advantage of anyone with whom Executive
                improperly shares such information.  Specifically as to
                material, non-public information of the Company, Executive agrees
                to
                comply with the Company’s insider trading policy in effect at the
                commencement of employment and as amended from time to
                time.

            


    

     

    
      	
              11.2  

            	
              Codes
                of
                Conduct.  Executive agrees to carefully review, sign and
                fully comply with any Code of Conduct (or similar policy) of the
                Company
                either having general applicability to its employees or specifically
                to
                Executive.

            


    

     

    12. Restrictions
      against Solicitation; Non-Interference.  During
      his employment by the Company and for a period of eighteen (18) months after
      termination of such employment for any reason, Executive agrees that he will
      not
      engage in the following conduct.

     

    
      	
              12.1  

            	
              Restrictions
                against
                Solicitation.  Executive will not, directly or
                indirectly, hire or initiate any solicitation or recruitment effort
                for
                the purpose of attempting to hire any employee of the Company or
                to induce
                any employee of the Company to leave his employment with the
                Company.

            


    

     

    With
      respect to job candidates with or about whom Executive, while employed by the
      Company, had actual contact or knowledge, Executive will not, directly or
      indirectly, initiate any solicitation or recruitment effort for the purpose
      of
      attempting to hire any such candidate for or on behalf of his new employer
      or
      any company in which Executive owns, directly or indirectly, an
      interest.

     

    
      	
              12.2  

            	
              Non-interference.  Executive
                will not, directly or indirectly, disrupt, damage, impair, impede
                or
                interfere with the contractual relationship between the Company and
                any of
                its clients.

            


    

     

    13. Restrictions
      Against
      Competition.

     

    
      	
              13.1  

            	
              Restricted
                Period.  During his employment by the Company and for a
                period of eighteen (18) months after termination of such employment
                for
                any reason, Executive agrees not to engage in any Competitive Acts
                with
                any client or prospective client of the Company within the prior
                24 months
                prior to termination of Executive’s employment.  Nothing
                contained in this Agreement, however, creates any obligation on Executive
                that is inconsistent with, or would require Executive to violate,
                the
                Rules of Professional Conduct.

            


    

     

    
      	
              13.2  

            	
              Definitions.  For
                purposes of this Section 13, the following terms shall be defined
                as
                follows.

            


    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    “Competitive
      Acts” means soliciting, selling, marketing, brokering, providing or managing any
      Services for any Client, whether directly as an employee of a Client or
      indirectly as an employee, subcontractor, partner or owner of a
      Competitor.

     

    “Client”
      means: (A) any Company client for whom Executive provided Services at any time
      during the previous two years of Executive’s employment with the Company; or (B)
      any Company client or prospective client to whom Executive solicited, proposed,
      marketed or sold Services at any time during the previous two years of
      Executive’s employment with the Company; (C) any third party having a written
      partnership, alliance or teaming agreement or similar strategic business
      relationship with the Company, for whom Executive provided Services at any
      time
      during the previous two years of Executive’s employment with the
      Company.

     

    “Competitor”
      means any third party offering technical consulting services within the United
      States that competes with the Company or is similar in kind or nature to the
      services provided by the Company.

     

    
      	
              14.  

            	
              Reasonableness
                of
                Restrictions; Representations of Executive; Extension of Restrictions;
                Enforcement.

            


    

     

    
      	
              14.1  

            	
              Reasonableness
                of
                Restrictions.  Executive acknowledges that the
                restrictions set forth in this Agreement are reasonable in terms
                of both
                the Company’s need to protect its legitimate business interests and
                Executive’s ability to pursue alternative employment opportunities in the
                event his employment with the Company
                terminates.

            


    

     

    
      	
              14.2  

            	
              Representations
                of
                Executive.  Executive represents that his performance of
                all the terms of this Employment Agreement and his performance as
                an
                employee of the Company does not and will not breach any agreement
                to keep
                in confidence proprietary information, knowledge or data acquired
                by
                Executive prior to his employment with the Company.  Executive
                will not disclose to the Company, or induce the Company to use, any
                confidential or proprietary information or material belonging to
                any
                previous employer of Executive or others.  Executive is not a
                party to any other agreement that would interfere with his full compliance
                with this Executive Agreement.  Executive agrees not to enter
                into any agreement, whether written or oral, in conflict with the
                provisions of this Agreement.

            


    

     

    
      	
              14.3  

            	
              Extension
                of
                Restrictions.  The period of all restrictions under this
                Agreement will automatically be extended by a period equal in length
                to
                any period in which Executive violates his obligations under this
                Agreement.

            


    

     

    
      	
              14.4  

            	
              Enforcement.  In
                addition to any other relief or remedies afforded by law or in equity,
                if
                Executive breaches Sections 12 or 13 of this Agreement, Executive
                agrees
                that the Company shall be entitled, as a matter of right, to injunctive
                relief in any court of competent jurisdiction.  Executive
                recognizes and hereby admits that irreparable damage will result
                to the
                Company if he violates or threatens to violate the terms of Section
                12 or
                13 of this Agreement.  This Section 14.4 shall not preclude the
                granting of any other appropriate relief including, without limitation,
                money damages against Executive for breach of Section 12 or 13 of
                this
                Agreement.

            


    

     

    15. Return
      of Property: Exit
      Interview.

     

    
      	
              15.1  

            	
              Return
                of
                Property, Upon any termination of his employment with the Company,
                Executive agrees to promptly return to the Company: (A) all materials
                of
                any kind in Executive’s possession (or under Executive’s control)
                incorporating Confidential Information or otherwise relating to the
                Company’s business (including but not limited to all such materials and/or
                information stored on any computer or other storage device owned
                or used
                by Executive); and (B) all Company property in Executive’s possession,
                including (but not limited to) computers, cellular telephones, pagers,
                credit cards, keys, records, files, manuals, books, forms, documents,
                letters, memoranda, data, tables, photographs, video tapes, audio
                tapes,
                computer disks and other computer storage media, all materials that
                include trade secrets, and all copies, summaries or notes of any
                of the
                foregoing.

            


    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    
      	
              15.2  

            	
              Exit
                Interview.  Upon any termination of his employment with
                the Company and upon request, Executive agrees to participate in
                an exit
                interview conducted by designated personnel and to provide a signed
                statement that all Company materials and property have been returned
                to
                the Company.

            


    

     

    16. Assignment.

     

    This
      Agreement sets forth personal obligations of Executive, which may not be
      transferred or assigned by Executive.  The Company may assign this
      Agreement to any successor or affiliate.

     

    17. Non-Disparagement.

     

    Executive
      agrees not to engage in any form of conduct or make any statements or
      representations to current or prospective customers of the Company, media
      outlets, employees or management of a corporation or business in direct
      competition with the Company, or otherwise publish statements or representations
      to the public at large which may be actionable, that disparage, characterize
      in
      demeaning manner, question the Company’s business practices, products, advice,
      quality of employees and staff, or otherwise harm the public reputation or
      good
      will of the Company, its employees, or management.

     

    18. Indemnity;
      Cooperation in
      Legal Actions.

     

    
      	
              18.1  

            	
              Indemnity.  The
                Company will indemnify Executive against any claims arising from
                or
                related to his good faith performance of his duties and obligations
                hereunder to the fullest extent allowed by Company By-laws and Minnesota
                law.

            


    

     

    
      	
              18.2  

            	
              Cooperation
                in Legal
                Actions.  In connection with any action or proceeding
                against Executive, whether pending or threatened, for which the Company
                is
                obliged to indemnify Executive, the Company will pay or reimburse
                Executive in advance of the final disposition for reasonable expenses,
                including reasonable attorneys’ fees, necessarily incurred by
                Executive.  Executive will cooperate fully with the Company, at
                no expense to Executive, in the defense of any action, suit, claim,
                or
                proceeding commenced or threatened against the Company in conjunction
                with
                any action, suit, claim or proceeding commenced or threatened against
                him.  In addition to the foregoing, Executive further agrees to
                provide assistance to the Company, at the Company’s expense, as may be
                reasonably requested by the Company or its attorneys in connection
                with
                the litigation of any action, suit, claim, or proceeding involving
                the
                Company, whether not pending or to be commenced, which arises out
                of or is
                related to any matters in which Executive was involved or for which
                he was
                responsible during the term of his employment with the
                Company.

            


    

     

    19. Survival.

     

    The
      rights and obligations set forth in Sections 6.5, 7.1, 8-11, 12-18 and 23 shall
      survive the termination or expiration of this Agreement.  The
      provisions of this Agreement shall survive termination of Executive’s employment
      regardless of whether Executive resigns or is involuntarily
      discharged.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    Such
      provisions of this Agreement shall survive termination of Executive’s employment
      regardless of whether Executive resigns or is involuntarily
      discharged.

     

    20. Miscellaneous.

     

    
      	
              20.1  

            	
              Headings;
                Construction.  The headings of Sections and paragraphs
                herein are included solely for convenience of reference and shall
                not
                control the meaning or interpretation of any of the provisions of
                this
                Agreement.  This Agreement shall be construed without regard to
                any presumption or other rule requiring construction hereof against
                the
                party causing this Agreement to be
                drafted.

            


    

     

    
      	
              20.2  

            	
              Benefit.  Subject
                to Section 16, nothing in this Agreement, expressed or implied, is
                intended to confer on any person other than the parties hereto, any
                rights, remedies, obligations or liabilities under or by reason of
                this
                Agreement.

            


    

     

    
      	
              20.3  

            	
              Waiver.  Any
                delay by either party in asserting a right under this Agreement or
                any
                failure by either party to assert a right under this Agreement will
                not
                constitute a waiver by the asserting party of any right hereunder,
                and the
                asserting party may subsequently assert any or all of its rights
                hereunder
                as if the delay or failure to assert rights had not
                occurred.

            


    

     

    
      	
              20.4  

            	
              Severability.  If
                the final determination of a court of competent jurisdiction declares,
                after the expiration of the time within which judicial review (if
                permitted) of such determination may be perfected, that any term
                of
                provision hereof is invalid or unenforceable, (a) the remaining terms
                and
                provisions hereof shall be unimpaired, and (b) the invalid or
                unenforceable term or provision shall be deemed replaced by a term
                or
                provision that is valid and enforceable and that comes closest to
                expressing the intention of the invalid or unenforceable term or
                provision.

            


    

     

    21. Entire
      Agreement;
      Amendment.

     

    
      	
              21.1  

            	
              Entire
                Agreement.  Both Executive and the Company agree that
                this Agreement, Exhibit A to the Agreement and the Executive’s stock
                option agreement constitute the entire agreement between them with
                respect
                to the subject matter of this Agreement.  There were no
                inducements or representations leading to the execution of this Agreement
                except as stated in this Agreement.  Accordingly, this Agreement
                expressly supersedes any and all prior oral and written agreements,
                representations and promises between the parties relating to Executive’s
                employment with the Company.

            


    

     

    
      	
              21.2  

            	
              Amendment.  This
                Agreement may be amended or modified only with the written consent
                of both
                Executive and the Company.  No oral waiver, amendment or
                modification will be effective under any circumstances
                whatsoever.

            


    

     

    
      	
              22.  

            	
              Notices.  Any
                notice hereunder by either
                party to the other shall be given in writing by personal delivery
                or
                certified mail, return receipt requested.  If addressed to
                Executive, the notice shall be delivered or mailed to Executive at
                the
                address most recently communicated in writing by Executive to the
                Company,
                or if addressed to the company, the notice shall be delivered or
                mailed to
                Analysts at its executive offices to the attention of the CEO of
                the
                Company.  A notice shall be deemed given, if by personal
                delivery, on the date of such delivery or, if by certified mail,
                on the
                date shown on the applicable return
                receipt.

            


    

     

    23. Governing
      Law; Disputes;
      Arbitration of Termination of Employment for Cause.

     

    
      	
              23.1  

            	
              Governing
                Law;
                Disputes.  This Agreement will be governed by and
                construed in accordance with the laws of the State of Minnesota,
                as such
                laws are applied to agreements entered into and to be performed entirely
                within Minnesota between Minnesota residents.  Except as set
                forth in Section 23.2 below, the undersigned each irrevocably consent
                to
                the jurisdiction of the United States District Court for the District
                of
                Minnesota and the courts of the State of Minnesota in any suit, action,
                or
                proceeding brought under, based on or related to or in connection
                with
                this Agreement, and each of the undersigned agrees that either of
                the
                aforesaid courts will be the exclusive original forum for any such
                action.

            


    

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    
      	
              23.2  

            	
              Arbitration
                of
                Termination of Employment for Cause.  Any dispute arising
                out of or relating to termination of Executive’s employment for Cause
                pursuant to Section 6 of this Agreement, shall be discussed between
                the
                disputing parties in a good faith effort to arrive at a mutual settlement
                of any such controversy.  If, notwithstanding, such dispute
                cannot be resolved, such dispute shall be settled by binding
                arbitration.  Judgment upon the award rendered by the arbitrator
                may be entered in any court having jurisdiction thereof.  The
                arbitrator shall be a retired state or federal judge or an attorney
                who
                has practiced securities or business litigation for at least 10
                years.  If the parties cannot agree on an arbitrator within 20
                days, any party may request that the chief judge of the District
                Court for
                Hennepin County, Minnesota, select an arbitrator.  Arbitration
                will be conducted pursuant to the provisions of this Agreement, and
                the
                commercial arbitration rules of the American Arbitration Association,
                unless such rules are inconsistent with the provisions of this
                Agreement.  Limited civil discovery shall be permitted for the
                production of documents and taking of depositions.  Unresolved
                discovery disputes may be brought to the attention of the arbitrator
                who
                may dispose of such dispute.  The arbitrator shall have the
                authority to award any remedy or relief that a court of this state
                could
                order or grant; provided, however, that punitive or exemplary damages
                shall not be awarded.  The Company shall pay the fees and
                expenses of the arbitrator.  Unless otherwise agreed by the
                parties, the place of any arbitration proceedings shall be Hennepin
                County, Minnesota.

            


    

     

     

    IN
      WITNESS WHEREOF, the parties have executed
      this
      Agreement by their signatures below:

     

    
      	
              
              

              Analysts
                International Corporation

              
              

            	
              
              

              Robert
                E. Woods

              
              

            
	
              
              

              By:
                ___________________________

              
              

            	
              
              

              By:
                ___________________________

              
              

            
	
              
              

              Date:  _________________________

              
              

            	
              
              

              Date:  _________________________

              
              

            


    

     

    


     

    



    
      
        
          
             

          

        

        
        

      

      
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