Exhibit 10.1March 31, 2005Stephen McGillDear Stephen:I am pleased to confirm to you in writing our offer for the position of Vice President and GeneralManager, International, reporting to me. The responsibilities for this position have been ineffect since January 1, 2005, although your physical move to headquarters will happen on or aboutApril 6, 2005. You will be based at our headquarters in Minnetonka, Minnesota for an undeterminedamount of time. As this time is undetermined and also at your request, we will be retaining you onthe UK pension system.Your compensation package is summarized below. **•** You will receive an annual base salary of $205,000 per year. You will also participatein the company’s Executive Variable Incentive Plan, which will provide $72,000 at target;  **•** You will participate in AMS’ headquarters benefits, including medical insurance,however, as noted, you will be retained on the UK pension system;  **•** You will be responsible for paying your portion of US federal and Minnesota state taxesas well as US social security taxes, as do other US employees. We will not require you tocontribute hypothetical taxes. You may, however, incur taxable income for the differencebetween our US savings plans (401(k) and Profit Sharing) and UK pension.  **•** A Cost of Living adjustment was not found to be necessary in the analysis conducted byOrganizational Resources Consultants (ORC), however, we will be providing an effectivepurchaser premium as follows: **§** May – October, 2005 (6 months)  — $1,000/month  **§** November, 2005 – April, 2006 (6 months) — $750/month  **§** May, 2006 – October, 2006 (6 months)  — $500/month **•** Also, while a car allowance (or the dollar value) was not deemed necessary per theanalysis of ORC, we are providing an allowance to assist you in transitioning from acompany-paid car to your own arrangements via a payment of $1200/month for 12 monthsbeginning May, 2005.  **•** The Company recognizes that your tax situation will be complicated during yourassignment to the US. Therefore the Company has retained Pricewaterhouse Coopers to assistyou with your tax filings. The Company will pay for this service. This service will belimited to filing of home and host country tax returns
 

 
   and compliance with the local taxlaws of the two countries. Any personal tax planning advice will have to be paid by youpersonally.  **•** The Company will reimburse you with two round trip economy class air fares for you andAudrey each year. The leave will be within the normal US holiday schedule.  **•** A customized relocation program is provided as attached. This relocation programincludes two months’ base pay for miscellaneous moving expenses. This amount will be paidwhen the move is underway, in April.  **•** Except in the situation of a termination for cause, AMS agrees to repatriate you, yourfamily and your belongings (as per our standard relocation policy) at any time during thefirst three years of your assignment here in Minnetonka.  **•** Except in the situation of a termination for cause or your voluntary resignation, AMSwill supplement our normal severance formula, and guarantee you a minimum severance paymentof six months your base salary, and a continuation of benefits for this same period oftime.This Letter, together with the American Medical Systems, Inc. Employment Agreement, states ourentire understanding of your employment status with AMS.Your assignment is conditional upon the issue and maintenance of valid residency, work and/or anyother permits necessary to legally reside and work in the United States. Please acknowledgereceipt and your acceptance of this Assignment Letter and Agreement by signing the two (2)originals and returning one to the Jan Dick.Sincerely yours,        Marty Emerson Date  President and CEO            **ACKNOWLEDGE AND ACCEPTANCE:**             *Employee’s Signature* *Date*