exhibit10_1.htm


    EXHIBIT
      10.1

     

    SEVERANCE
      AGREEMENT AND RELEASE OF CLAIMS

     

    David
      Steichen

     

    I.    Definitions.  You
      and I intend all words used in this Severance Agreement and Release of Claims
      (“Agreement”) to have their plain meanings in ordinary
      English.  Specific terms that you and I use in this Agreement have the
      following meanings:

     

    
      	
               

            	
              A.

            	
              I,
me,
                and my
                include both
                me (David Steichen) and anyone who has or obtains any legal rights
                or
                claims through me. 

            


    

     

    
      	
               

            	
              B.

            	
              Analysts
                International means Analysts International Corporation and any
                related or affiliated business entities in the present or past, including
                without limitation, its or their predecessors, successors, parents,
                subsidiaries, affiliates, joint venture partners, and divisions.
                

            


    

     

    
      	
               

            	
              C.

            	
              Company
                means
                Analysts International; the present and past Board of Directors,
                shareholders, officers and employees of Analysts International; Analysts
                International’s insurers; and anyone who acted on behalf of Analysts
                International or on instructions from Analysts International.
                

            


    

     

    
      	
               

            	
              D.

            	
              My
                Claims means
                any and all claims, actions, rights, causes of action and demands,
                known
                or unknown, arising at law, in equity, or otherwise, from the beginning
                of
                time and continuing through and up to the date on which I sign this
                Agreement, which I have or may have against the Company, including
                without
                limitation: 

            


    

     

    
      	
               

            	
              1.

            	
              all
                claims arising out of or relating to my employment with Analysts
                International or the termination of that employment;
                

            


    

     

    
      	
               

            	
              2.

            	
              all
                claims arising out of or relating to the statements, actions or omissions
                of the Company; 

            


    

     

    
      	
               

            	
              3.

            	
              all
                claims for any alleged unlawful discrimination, harassment, retaliation
                or
                reprisal, or other alleged unlawful practices arising under any federal,
                state, or local statute, ordinance, or regulation, including without
                limitation claims under Title VII of the Civil Rights Act of 1964,
                the Age
                Discrimination in Employment Act, as amended by the Older Workers
                Benefit
                Protection Act of 1990, the Americans with Disabilities Act, 42 U.S.C.
§
                1981, the Employee Retirement Income Security Act (except for any
                vested
                claim for benefits under a qualified retirement plan that may be
                brought
                pursuant to 502(a)(1)(B) of ERISA), the Worker Adjustment and Retraining
                Notification Act, the Equal Pay Act, the Minnesota Human Rights Act,
                and
                any applicable local human rights ordinance;


            


    

     

    
      	
               

            	
              4.

            	
              all
                claims for alleged wrongful discharge; breach of contract; breach
                of
                implied contract; failure to keep any promise; breach of a covenant
                of
                good faith and fair dealing; breach of fiduciary duty; estoppel;
                my
                activities, if any, as a “whistleblower”; defamation; infliction of
                emotional distress; fraud; misrepresentation; negligence; harassment;
                retaliation or reprisal; constructive discharge; assault; battery;
                false
                imprisonment; invasion of privacy; interference with contractual
                or
                business relationships; any other wrongful employment practices;
                and
                violation of any other principle of common law;


            


    

     


    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    


    


     

    
      	
               

            	
              5.

            	
              all
                claims for compensation of any kind, including without limitation,
                salary,
                wages, bonuses, commissions, stock-based compensation, vacation pay,
                paid
                time off, fringe benefits and expense reimbursements;
                

            


    

     

    
      	
               

            	
              6.

            	
              all
                claims for reinstatement or other equitable relief; back pay, front
                pay,
                compensatory damages, damages for alleged personal injury, liquidated
                damages and punitive damages; and 

            


    

     

    
      	
               

            	
              7.

            	
              all
                claims for attorneys’ fees, costs and interest.


            


    

     

    However,
      My Claims does
      not include any claims that the law does not allow to be waived or any claims
      that may arise after the date on which I sign this Agreement.

     

    
      	
               

            	
              E.

            	
              You
                and your
                include Analysts International and anyone who has or obtains any
                legal
                rights or claims through Analysts International.
                

            


    

    


    
      	
               

            	
              F.

            	
              Your
                Claims
                means any and all claims, actions, rights, causes of action and demands,
                known or unknown, arising at law, in equity, or otherwise, from the
                beginning of time and continuing through and up to the date on which
                you
                sign this Agreement, which you have or may have against me, including
                without limitation: 

            


    

    


    
      	
               

            	
              1

            	
              all
                claims arising out of or relating to my employment with Analysts
                International; 

            


    

    


    
      	
               

            	
              2.

            	
              all
                claims for expense reimbursements; 

            


    

    


    
      	
               

            	
              3.

            	
              all
                claims for any equitable relief; compensatory damages, damages for
                alleged
                personal injury, liquidated damages and punitive damages; and
                

            


    

    


    
      	
               

            	
              4.

            	
              all
                claims for attorneys’ fees, costs and interest.


            


    

    


    However,
      Your Claims
      does not include any claims that the law does not allow to be waived or any
      claims that may arise after the date on which you sign this
      Agreement.

     

    II.    Termination
      of Employment
      and Agreement to Release My Claims.

     

    A.           
      My employment with Analysts International will terminate as of the close of
      business on February 19, 2008. Provided I perform all of my obligations under
      this Agreement and do not revoke this Agreement within the fifteen day
      revocation period below, I will receive “Special Consideration” from Analysts
      International in the form of:

     

    
      	
              i.  

            	
              a
                single lump sum severance payment equal to one year’s salary (at my
                current rate of pay and subject to normal
                withholdings);

            


    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
      	
              ii.  

            	
              a
                bonus of $25,000, equivalent to the fourth quarter management incentive
                bonus opportunity, which the Company will pay whether or not I actually
                qualify for such bonus;

            


    

     

    
      	
              iii.  

            	
              a
                $20,000 stay bonus if, in the reasonable judgment of the Company’s CEO, I
                satisfactorily perform the transition of my duties through February
                19,
                2008;

            


    

     

    
      	
              iv.  

            	
              if
                I choose to extend my employment through February 29, 2008, a $25,000
                “extra effort” bonus if in the reasonable judgment and sole discretion of
                the Company’s CEO, I have exerted all reasonable efforts to enable the
                filing of the Company’s Form 10-K for fiscal year 2007 with the SEC on or
                before February 29, 2008 and such Form 10-K is signed by me in my
                capacity
                as the Company’s CFO (it being understood, however, that nothing herein
                creates any obligation or expectation that I act in any way that
                is
                inconsistent with, or would require me to violate, any applicable
                code of
                professional conduct, and further understood that if, in the reasonable
                judgment of both me and the Company’s CEO, it would be imprudent or
                inadvisable to file the Form 10-K on or before February 29, 2008,
                but in
                the CEO’s reasonable judgment and sole discretion I have made every
                reasonable effort to accomplish the filing by such date, this payment
                will
                nevertheless be made);

            


    

     

    
      	
              v.  

            	
              an
                additional payment in the amount of $27,000.00, to compensate me
                for the
                loss of use of the leased vehicle the Company has previously provided
                for
                me;

            


    

     

    
      	
              vi.  

            	
              payment
                of 100% of the monthly premiums for health, dental and life insurance
                coverage through February 19, 2009 or until I become eligible for
                comparable health, dental, and life insurance through another employer,
                whichever occurs sooner;

            


    

     

    
      	
              vii.  

            	
              twelve
                months of outplacement services (which may begin any time after execution
                and delivery of this agreement and expiration of the revocation period
                set
                forth herein) in accordance with the Company’s arrangement with Lee Hecht
                Harrison, LLC; and

            


    

     

    
      	
              viii.  

            	
              reimbursement
                of my out-of-pocket expenses in becoming recertified as a public
                accountant, including the cost of obtaining CPE credits, in an amount
                not
                to exceed $5,000.00.

            


    

     

    For
      the
      avoidance of doubt, I will be eligible to receive each of the items of the
      Special Consideration set forth in items i-iii and v-viii if I continue my
      employment through February 19, 2008, perform all of my obligations under this
      Agreement with respect to each such item, do not revoke this Agreement within
      the fifteen day revocation period, and the remaining terms and conditions set
      forth in the Agreement have been met.  Notwithstanding the foregoing,
      I will be eligible to receive the Special Consideration set for in item iv
      above
      only if I have met and satisfied the terms and conditions of such item
      iv.

     

    B.           
      My Special Consideration is contingent upon me signing and not revoking this
      Agreement as provided below. I understand and acknowledge that the Special
      Consideration is in addition to anything of value that I would be entitled
      to
      receive from Analysts International if I did not sign this Agreement or if
      I
      revoked this Agreement.

     

    C.           
      In exchange for the Special Consideration, I give up, settle
      and
      release all of My Claims and I agree to abide by this Agreement in all
      respects.  I understand and agree that through this release I
      am extinguishing all of My Claims occurring up to the date on which I sign
      this
      Agreement.  The Special Consideration that I am receiving is a fair
      compromise for my undertakings in this Agreement.

     

    D.           
      Notwithstanding the foregoing, I understand that nothing contained in this
      Agreement purports to limit any right I may have to file a charge with Equal
      Employment Opportunity Commission or other administrative agency or to
      participate in an investigation or proceeding conducted by the Equal Employment
      Opportunity Commission or other investigative agency. This Agreement does,
      however, waive and release any right to recover monetary damages resulting
      from
      such investigation or litigation.

     


    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    


    E.           
      Likewise, in exchange for my release of My Claims and other consideration,
you give up, settle
      and
      release all of Your Claims and you agree to abide by this Agreement in all
      respects.  You understand and agree that through this release
      you are extinguishing all of Your Claims occurring up to the date on which
      you
      sign this Agreement

     

    F.           
      For the avoidance of doubt,
      the
      Company acknowledges that nothing in this Agreement
      is intended to diminish or alter
      any rights I may have under the Company’s Restated Special Executive
      Retirement Plan as adopted December 27, 2006 and amended September 1, 2007
      (the
“Plan”), which rights are as stated in the Plan.  The Company has advised me that
      as of
      December
      29, 2007 the accrued balance in
      my deferred compensation account is $121,000.  Between
      December 30, 2007 and the
      distribution of my deferred compensation, the Company acknowledges
      that my balance will continue
      to accumulate and
accrue
      interest in
      accordance with the terms of the Plan as administered under the direction of
      the
      Company’s
      Board of Directors.  I
      will be paid the full amount in my deferred compensation account
within
      ten (10) business days of when
      such payment is allowed
      under section 409A of the Internal Revenue
      Code
      of 1986, as amended.

     

    G.           
      To the extent I am presently
      covered by the Company’s D&O policies for acts or omissions
      that occurred within the scope of
      my employment, the Company agrees that it will continue to maintain reasonable
      levels of such coverage for not less than two (2) years after the termination
      of
      my employment.

     

    III.    No
      Admission of Liability.  Even though
      Analysts International will provide Special Consideration for me to settle
      and
      release My Claims and to otherwise abide by this Agreement, the Company does
      not
      admit that it is responsible or legally obligated to me.  In fact, the
      Company denies that it is responsible or legally obligated to me for My Claims,
      denies that it engaged in any unlawful or improper conduct toward me, and denies
      that it treated me unfairly or acted wrongfully.

     

    IV.     Acknowledgement
      of Risk of Change in Facts or Law.  I acknowledge that the
      facts and the law material to this Agreement may turn out to be different from
      or contrary to my present belief, and I assume the risk that such differences
      may arise.  I acknowledge and represent that I have not relied on any
      representations of the Company or the Company’s counsel in entering into this
      Agreement.  Once the fifteen day revocation period below has expired,
      I intend that the release granted herein shall be final, complete, irrevocable
      and binding in all events and circumstances whatsoever.

     

    V.    Advice
      to
      Consult with an Attorney.  I understand
      and
      acknowledge that I am hereby being advised by the Company to consult with an
      attorney prior to signing this Agreement.  My decision whether to sign
      this Agreement is my own voluntary decision made with full knowledge that the
      Company has advised me to consult with an attorney.

     

    VI.    Period
      to
      Consider this Agreement.  I understand that I have 45 days from
      the day that I receive this Agreement (not counting the day upon which I receive
      it), or through March 5, 2008, or whichever is later, to consider whether I
      wish
      to sign this Agreement.  I understand Analysts International will
      accept this Agreement and pay to me the Special Consideration described above
      if
      I sign and return this Agreement and if I do not revoke this Agreement as
      provided below.  I understand that if I sign this Agreement on or
      before March 5, 2008, or choose to forego the advice of legal counsel, I do
      so
      freely and knowingly, and I waive any and all further claims that such action
      or
      actions would affect the validity of this Agreement.  I understand
      that any changes to this Agreement, whether material or not material, do not
      restart the period of time I have to consider whether or not to sign this
      Agreement.

     

    If
      I
      elect not to execute and return this Agreement on or before March 5, 2008,
      I
      further understand that the offer contained herein shall terminate and Analysts
      International shall be under no obligation to provide the severance compensation
      and the benefits provided herein.

     


    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    


    VII.    My
      Right
      to Revoke this Agreement.  I understand
      that
      I may revoke this Agreement at any time within fifteen days after I sign it,
      not
      counting the day upon which I sign it.  This Agreement will not become
      effective or enforceable unless and until the fifteen-day revocation period
      has
      expired without my revoking it.  I understand that if I rescind or
      revoke this Agreement, all of Analysts International’s obligations to me under
      this Agreement will immediately cease and terminate, and Analysts International
      will owe me no amounts hereunder.  If I do not revoke or rescind this
      Agreement within said fifteen-day period, I understand that the Company will
      pay
      the Special Consideration to me on my termination date or when that fifteen-day
      period expires, whichever is later.

     

    VIII.    Procedure
      for Accepting or Revoking this Agreement. To accept the
      terms of this
      Agreement, I must deliver the Agreement, after I have signed and dated it,
      to
      Analysts International by hand or by certified mail, return receipt requested,
      on or before March 5, 2008.  To revoke my acceptance, I must deliver a
      written, signed statement that I revoke my acceptance to Analysts International
      by hand or by certified mail within the fifteen-day revocation
      period.  All certified mailings and hand deliveries must be made to
      Analysts International at the following address:

     

    Jill
      Dose

    Analysts
      International Corporation

    3601
      West 76th
      Street

    Edina,
MN 55435

     

    If
      I
      choose to deliver my acceptance or the revocation of my acceptance by mail,
      it
      must be:

     

    
      	
               

            	
              1.

            	
              postmarked
                within the period stated above; and


            


    

     

    
      	
               

            	
              2.

            	
              properly
                addressed to Jill Dose, Analysts International, at the address stated
                above. 

            


    

     

    IX.    Non-disparagement.  Both
      I and the
      Company agree not to make negative or disparaging remarks or comments about
      each
      other, including, in the case of the Company, about its officers, directors,
      management, employees, products or services.

     

    X.    Non-solicitation.  I
      will not
      solicit, either directly or indirectly, or accept, for my own account or for
      anyone else, business for services or products similar in use or application
      to
      Analysts International’s services or products of any Analysts International
      customer or prospective customer: (i) which at any time during the last 12
      months of my employment with Analysts International was a customer of the
      office, business group or unit, practice or reporting unit to which I was
      assigned; or (ii) to whom, during the last 12 months of my employment the
      Analysts International office, business group or unit, practice or reporting
      unit which I was assigned, submitted a proposal or proposals for Analysts
      International’s services or products; or (iii) with whom, during the last 12
      months of my employment, I otherwise dealt or about whom I received business
      information.  I will also refrain from participating in or giving
      information or other assistance to anyone else in soliciting such business
      from
      these Analysts International customers and prospective customers.  I
      agree that I will refrain from this form of unfair competition for a period
      of
      12 months after my employment with Analysts International.

     


    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    


    XI.    Non-interference,
      Cooperation.  Recognizing
      that
      Analysts International incurs significant expense in recruiting its personnel
      and has the right to expect their continued service, I will not interfere with
      Analysts International’s relationships with its employees and
      subcontractors.  Specifically, I will not participate or give
      assistance in any effort of any other business, including any business that
      I
      may own or operate to hire or engage the services of an Analysts International
      employee or subcontractor; nor will I encourage any Analysts International
      employee or subcontractor to leave the employment or service of Analysts
      International.  I agree that I will not engage in this form of unfair
      competition for a period of 12 months after my employment with Analysts
      International.  In addition, for not less than one (1) year following
      termination of my employment, I will cooperate with the Company in any matters
      involving the transition of my responsibilities or other matters involving
      the
      business of the Company.

     

    XII.    Confidentiality.  I
      agree that
      following the termination of my employment, I will keep confidential, and will
      not use for my benefit for the benefit of any other company or person,
      confidential Analysts International business information, including but not
      limited to the identity of Analysts International customers and prospective
      customers and their requirements for IT consulting and other services provided
      by Analysts International, salary information, contract rates in contract
      expiration dates, details of Analysts International projects, business,
      marketing and strategic plans and company or office financial
      information.  I recognize that the Company has furnished any
      information of this type to me in confidence on the understanding that I would
      not disclose any such confidential information or use it for the advantage
      of
      myself or anyone other than Analysts International.

     

    XIII.    Return
      of
      Property.  I agree that
      I
      will not retain any copies of Company property or documents except to the extent
      required to perform my obligations under the Consulting Agreement between me
      and
      the Company having an effective date of March 3, 2008.  I agree that
      this obligation is ongoing and that if I subsequently discover any additional
      company property that I will promptly return it to Analysts International upon
      the termination of said Consulting Agreement.  I represent that upon
      the termination of any said Consulting Agreement I will deliver and return
      to
      the Company (a) all materials of any kind in my possession (or under my control)
      incorporating Confidential Information (as such term is defined in any
      applicable agreement between me and the Company) 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
      me),
      and (b) all Company property in my possession (or under my control), including
      (but not limited to) computers, computer software applications, 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.

     

    Notwithstanding
      the foregoing, the Company agrees that I may keep as my own the following
      Company property:  one Dell Latitude D600 laptop computer; one Dell
      Latitude D620 laptop computer and one Linksys router.  I will promptly
      and permanently remove all Company information on such computer.  I
      acknowledge and agree that from and after the effective date of termination
      of
      my employment with the Company, I will be solely responsible for any and all
      maintenance and support with respect to such computer, which is being furnished
      to me “AS IS” and without warranty of any kind (other than the warranty of clear
      title).

     

    XIV.             No
      Other
      Promises or Representations.  I agree that
      no
      promise or representation, other than the promises and representations expressly
      contained in this Agreement, has been made to me by the Company with regard
      to
      my separation from employment with the Company.

     


    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    


    XV.    Interpretation
      of this Agreement.  This Agreement
      should be interpreted as broadly as possible to achieve my intention to resolve
      all of My Claims against the Company and to otherwise fulfill my obligations
      under this Agreement.  If any provision of this Agreement is found to
      be illegal and/or unenforceable, such provision shall be severed and modified
      to
      the extent necessary to make it enforceable; and as so severed or modified,
      the
      remainder of this Agreement shall remain in full force and effect and
      enforceable with respect to the release of all the remainder of My
      Claims.

     

    XVI.    Voluntary
      Release.  I have read
      this
      Agreement carefully.  I understand all of its terms.  In
      signing this Agreement, I have not relied on any statements or explanations
      made
      by the Company except as specifically set forth in this Agreement.  I
      am voluntarily releasing My Claims against the Company without coercion, duress
      or reliance on any representations by any Analysts International employee,
      agent
      or attorney and I am voluntarily undertaking my other obligations under this
      Agreement without coercion, duress or reliance on any representations by any
      Analysts International employee, agent or attorney.  I intend this
      Agreement to be legally binding.

     

    XVII.    Non-Disclosure
      of this Agreement.  I agree that
      the
      terms of this Agreement are confidential.  I will not, directly or
      indirectly, disclose any of the terms of this Agreement to anyone other than
      my
      immediate family or counsel, except as such disclosure may be required for
      accounting or tax reporting purposes or as otherwise may be required by law
      (for
      example, by subpoena or other compulsory legal process).

     

    XVIII.    Governing
      Law; Jurisdiction and Venue.  This Agreement is governed by and
      shall be construed in accordance with the laws of the State of Minnesota and
      any
      dispute related thereto shall be exclusively venued in the state courts of
      Minnesota located in Hennepin County, Minnesota.  In the event
      litigation results involving this Agreement, the unsuccessful party agrees
      to
      pay the prevailing party’s reasonable attorneys’ fees and costs.

     

    XIX.    Other
      Agreements.  I understand
      that
      this Severance Agreement and Release of Claims and the employee benefit plans
      of
      the Company in which I am a participant (including the Company’s Restated
      Special Executive Retirement Plan as adopted December 27, 2006 and amended
      September 1, 2007) contain all of the agreements between the Company and
      me.  These agreements supersede all other written and oral agreements
      we may have.  Any additions or changes to this Agreement must be in
      writing and signed by both parties.

     

    XX.     Survival.  I
      understand that the provisions of this Agreement that, by their nature and
      content, must survive the completion, rescission, termination or expiration
      of
      this Agreement in order to achieve the fundamental purposes of this Agreement
      (including but not limited to the provisions of paragraphs II(C), IX, X, XI,
      XII
& XIII of this Agreement) will survive the termination of my employment and
      the termination, for any reason, of this Agreement.

     


    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    


    XXI.    Release
      as Evidence.  I understand
      and
      agree that in the event that any claim, suit or action shall be commenced by
      me
      against Analysts International, including, but not limited to, claims, suits
      or
      actions relating to my employment with Analysts International through this
      date,
      this Agreement shall constitute a complete defense to any such claims, suits
      or
      actions so instituted.

    


     

    
      	
              David
                Steichen

            	
              Analysts
                International Corporation

              
              

            
	_______________________________________	
              
              

              By:
                ______________________________

            
	
              Title:
                _____________________________

            
	
              
              

              Date
                signed: _________________________

            	
              
              

              Date
                signed: ________________________

            


    

    


     

    


    
      
        
        

      

      
        8