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AMERICAN MEDICAL SYSTEMS, INC.
 AGREEMENT
 Stephen J. McGill
   NOW, INTENDING TO BE LEGALLY BOUND,
 1.
    
    AT-WILL EMPLOYMENT You will be employed on an at-will basis. As an at-will
employee, you are free to terminate your employment with AMS at any time, for any reason.
Similarly, AMS has the right to terminate your at-will employment at any time, for any
reason, with or without notice. However, certain provisions of this Agreement will continue
to be enforceable after the termination of your employment, whether your termination is
voluntary or involuntary.




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2.
    
    DUTIES AND RESPONSIBILITIES By entering this Agreement, you agree to perform
the duties and responsibilities that AMS may at any time assign, and you
understand that such duties and responsibilities may, and likely will, change
over time.3.
    
    NATURE OF BUSINESS AMS is engaged in several highly
specialized and competitive industries. As an AMS
employee, you will have access to valuable
confidential information, trade secrets, processes
and inventions. You may also have or acquire
important responsibilities involving substantial
interaction with, and through which you will develop
close business relationships with, AMS customers
and/or other AMS employees, or consultants. The
ownership, protection, confidentiality, and
nondisclosure of AMS policies, procedures, practices,
trade secrets, and other confidential information are
essential to AMS research efforts, financial and
business operations. AMS advises you, and you
acknowledge understanding that, any improper use of,
disclosure or distribution of those policies,
procedures, operating practices, trade secrets, or
other confidential information, or any improper
contact with AMS employees, consultants or customers
as prohibited by this Agreement whether intentional
or inadvertent, would cause serious and irreparable
injury to AMS.4.
    
    TRADE SECRETS AMS has, and is expected to
develop certain concepts,
products, processes,
information, designs,
ideas, policies and
procedures (collectively
Trade Secrets) which it
uses in its business which
give AMS an advantage over
competitors who do not
know, understand or use
these secrets. Trade
Secrets include the
following information:
 A.
    
    information which in any way relates to AMS design, engineering, manufacturing
or management activities, financial condition, financial operations,
purchasing activities, business plans and marketing activities;B.
    
    information acquired or compiled by AMS regarding actual or potential
customers, including their identities, their development prospects, financial
information concerning their business operations, identity and quantity of products
or services purchased from AMS, and all related accounts receivable information;C.
    
    information concerning or resulting from the development of internal policies,
procedures, standards, quality or productivity measures or tools; andD.
    
    any other information (in whatever form) as may, from time to time, be
designated by AMS as Proprietary or a Trade Secret.
  /s/ SJM
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5.
    
    CONFIDENTIAL INFORMATION AMS also has, and is expected to develop other
information, concepts, designs, policies, and procedures having independent economic value
from not being generally known or ascertainable by proper means which you will or may learn in
the course of employment (collectively Confidential Information) but which does not
constitute Trade Secrets as described above. Except as may be required by your employment
with AMS or as expressly agreed upon in writing by an authorized officer of AMS, you agree
that you will not, during or at any time after your employment with AMS, use or disclose any
Confidential Information or permit any person to examine, copy or otherwise receive any
Confidential Information.
 6.
    
    COMPLIANCE WITH LAWS, POLICIES, AND PROCEDURES In addition to
abiding by your obligations as described in this Agreement, you agree
that you will comply with present and future policies and procedures
of AMS, as well as applicable local, state, federal, and any
applicable foreign laws, including but not necessarily limited to
those laws governing use, protection and nondisclosure of AMS Trade
Secrets and Confidential Information. You further agree to promptly
notify an AMS Human Resources Department employee or other designee
regarding any question or objection you may have regarding our
compliance with state, federal or foreign laws or regulations.7.
    
    CONFLICT OF INTEREST You agree to devote your entire productive
time, ability and attention to AMS business.
You further agree that while employed by
AMS you will not directly or indirectly
engage in outside ownership, employment,
consulting or other activities which, in
AMS exclusive judgment, conflict with your
employment obligations to AMS unless prior
written consent is obtained from an
authorized AMS officer. While you are
employed by AMS, you are required to give
AMS written notice and secure written
approval before acting as an owner,
employee, consultant to, or providing other
activities for, any entity other than AMS.
 8.
    
    RESTRICTIONS ON COMPETITIVE ACTIVITIES
 A.
    
    You represent and warrant to AMS that you are not currently subject to a
non-competition, confidentiality or other such agreement with a former employer which
prohibits or restricts you from working for AMS, or performing the services which AMS
would like you to perform. Further, you represent and warrant to AMS that you have not
brought any proprietary information, customer lists, trade secrets, confidential
information, or any other property with you which belongs to your former employer. You
agree and understand that AMS does not want you to utilize any such confidential or
proprietary information, trade secrets, or property on AMS behalf.B.
    
    Company Product means any product, product line or service that has been
designed, developed, manufactured, marketed, sold or is under research, development, or
is being pursued through acquisition or licensure, or has been the subject of
disclosure to AMS in response to a due diligence process by AMS, and during your
employment with AMS you have (1) have marketed or sold, directly
 /s/ SJM
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or indirectly, such product, product line or service, (2) you have received product
or sales training with respect to such product, product line or service, or (3) you
have been provided, or had access to, confidential or proprietary information
relating to such product, product line or service.C.
    
    During your employment with AMS and for a period of two (2) years (or for such
lesser period as may be the maximum period allowed under the law of the jurisdiction in
which AMS may seek to enforce this clause)after your employment with AMS ends, you will
not, alone or in any capacity (e.g., as an advisor, consultant, principal, agent,
partner, officer, director, shareholder, employee or otherwise) with another person or
entity, within any geographical area in which AMS, at any time during your employment
with AMS, was engaged in pursuit through acquisition, research, development,
manufacturing, sale, marketing, or distribution of a Company Product:
 1.
    
    directly or indirectly participate in or support in any
capacity the manufacture, invention, development, sale, solicitation of sale,
marketing, testing, research or other business aspect of any actual or
projected product, product line or service designed, developed, manufactured,
marketed or sold by anyone other than AMS that performs similar functions, is
used for the same general purposes as or is otherwise competitive with a
Company Product.2.
    
    disrupt, damage, impair, or interfere with the business of AMS
whether by way of interfering with or disrupting AMS relationship with
employees, customers, agents, representatives or vendors; or3.
    
    employ or attempt to employ (by soliciting or assisting anyone
else in the solicitation of) any of AMS then employees on behalf of any other
entity, whether or not such entity competes with AMS.
 D.
    
    During the restrictive period, the restrictions contained in this Section will
not prevent you from accepting employment with, or providing consulting services to, a
large diversified organization with separate and distinct divisions that do not
compete, directly or indirectly, with AMS, if. prior to accepting such employment or
providing such consulting services, AMS receives separate written assurances from the
prospective employer and from you, satisfactory to AMS, confirming that you will not
render any services, directly or indirectly, to any division or business unit that
competes, directly or indirectly, with AMS; and an authorized officer of AMS gives
written approval for you to provide the proposed employment or consulting services.
During the restrictive period set forth in this Section, you will inform any new
employer, prior to accepting employment or providing consulting services, of the
existence of this Agreement and provide such employer with a copy of this Agreement.
 /s/ SJM
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9.
    
    INVENTIONS
 A.
    
    Inventions means any inventions, discoveries, improvements and ideas, whether
or not in writing or reduced to practice and whether or not patentable or
copyrightable, made, authored or conceived by you, whether by your individual efforts
or in connection with the efforts of others, and that either (i) relate in any way to
AMS business, products or processes, past, present, anticipated or under development,
or (ii) result in any way from your employment by AMS, or (iii) use AMS equipment,
supplies, facilities or trade secret information.B.
    
    You agree that all Inventions made by you during the period of your employment
with AMS and for six (6) months thereafter, whether made during the working
hours of AMS or on your own time, will be the sole and exclusive property of
AMS. You will, with respect to any Invention: (i) keep current, accurate, and
complete records, which will belong to AMS and be kept and stored on AMS
premises; (ii) promptly and fully disclose the existence and describe the nature of
the Invention to AMS in writing (and without request); (iii) assign (and you
hereby assign) to AMS all of your right, title and interest in and to, the
Invention,
any applications you make for patents or copyrights in any country, and any
patents or copyrights granted to you in any country; and (iv) acknowledge and
deliver promptly to AMS any written instruments, and perform any other acts
necessary in AMS opinion to preserve property rights in the Invention against
forfeiture, abandonment or loss and to obtain and maintain letters patent and/or
copyrights on the Invention and to vest the entire right and title to the Invention
in AMS, whether during or after your employment with AMS.C.
    
    You represent that, except as disclosed below, as of the date of this
Agreement, you have no right under and will make no claims against AMS with respect to any
inventions, discoveries, improvements, ideas or works of authorship which would
be Inventions if made, conceived, authored or acquired by you during the term of
this Agreement. All inventions which you have already conceived or reduced to
practice and which you claim to be excluded from the scope of this Agreement are
listed below (if none, write none):
 
 
 
 /s/ SJM
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D.
    
    To the extent that any Invention qualifies as work made for hire as defined
in 17 U.S.C. § 101 (1976), as amended, such Invention will constitute work made for
hire and, as such, will be the exclusive property of the Company.E.
    
    NOTICE:Pursuant to Minnesota law, please be advised that this provision does
ot apply to any invention for which no equipment, supplies, facility, or trade secret
information of AMS was used and which was developed entirely on your own time, and
which does not relate directly to any business of AMS or any of AMS actual or
demonstrably anticipated research or development, or which does not result from any
work you perform for AMS.
 10.
    
    PENSION BENEFIT The Employer agrees to make monthly contributions to the Employees
UK pension plan as per the following formula: age 40  45 = 7%, age 46  50 = 10%, age 51 
55 = 11%, and age 55 + = 12%. (Note: age is defined as that on the previous March 1st, and
the percentage is taken on total earnings including bonus.) This is provided for information
only, the Company reserves the right to review, change or otherwise amend this pension
benefit.The Companys obligation to make a UK pension contribution will be reduced by the amount, if
any, of any Matching Contributions made under the AMS Savings and Investment Plan (SIP) with
respect to the applicable calendar year.
 11.
    
    RETURN OF PROPERTY Upon termination of employment or at any earlier
time as AMS may request, you agree to return to AMS any or all of its
property in your possession or control. Such property includes, but
is not limited to, any and all documents (including lab books),
whether on paper, electronic or other media, identification cards,
access cards, keys, credit cards, and computer programs or data,
regardless of where located or how stored.12.
    
    TERMINATION OF EMPLOYMENT Except in the situation of a termination
for cause or the Employees voluntary resignation, AMS will provide a
severance payment of six months base salary at the current base
salary rate at the time of termination notice. Medical and dental
benefits at the then current level of company contribution will also
be provided for up to six months if needed by the Employee, to cease
if the Employee is employed prior to the end of the six months period
of time. The above stated severance would also be applicable if the
Employer required that the Employee relocate to an area outside of the
United States or outside of Europe.13.
    
    REMEDIES You understand that violation of this
Agreement would result in immediate and
irreparable injury to AMS; accordingly, you
agree that AMS has the right to obtain an
injunction to specifically enforce the terms
of this Agreement, and to obtain any other
legal or equitable remedies which may be
available. You agree that such injunctive
relief
 /s/ SJM
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shall be in addition to and not instead of any right to recover money damages. Further, if
you violate this Agreement, you agree that AMS will be entitled to an accounting, and to the
repayment of all profits, compensation, commissions, fees, royalties, or other financial
rewards which you or any other entity or person may realize as a result of your violations.
Further, in the event you violate this Agreement, you agree to pay AMS costs and attorneys
fees incurred in pursuing its rights with respect to this Agreement.14.
    
    TRANSFERABILITY AMS may transfer or assign this Agreement or its rights to
obligations under this Agreement to any successor or assign, or to any person or entity
that purchases substantially all of the assets and/or stock of AMS. You agree that you will
not transfer or assign this Agreement or any of your rights or obligations under this
Agreement.15.
    
    ENTIRE AGREEMENT AND MODIFICATION This Agreement contains the entire
agreement between you and AMS relating to its subject matter and
supersedes any and all prior oral or written agreements,
representations or understandings, or inconsistent handbook or policy
manual provisions concerning the same subject matter. Any
modification must be in writing and signed by an authorized officer of
AMS. AMS may amend, modify, rescind or cancel this Agreement at any
time in its sole and absolute discretion.16.
    
    GOVERNING LAW AND JURISDICTION This Agreement shall be construed and
enforced in accordance with Minnesota law. By execution of this
Agreement, you and AMS agree to submit to personal jurisdiction in the
State of Minnesota, and agree that AMS may initiate any enforcement
action in a Minnesota state or United States federal court, or any
other court of competent jurisdiction.17.
    
    SEVERABILITY AND JUDICIAL MODIFICATION If any portion of this
Agreement is adjudicated to be invalid or unenforceable, then this
Agreement shall be deemed amended to modify or delete that portion
thus adjudicated invalid or unenforceable. If any portion is deemed
unenforceable by virtue of its scope or limitation, you and AMS agree
that a court of competent jurisdiction shall modify such provision to
make it enforceable to the fullest extent permitted by Minnesota law.18.
    
    ADVICE OF COUNSEL AND ACKNOWLEDGMENT You acknowledge that you have
been advised to seek your own counsel regarding this Agreement and
that you have so consulted or freely chosen not to seek counsel. By
signing this Agreement, you acknowledge that you have read and
understand this Agreement and agree to all its terms and conditions.
You also acknowledge that this Agreement has not been executed in
reliance upon any representation or promise except those contained
herein, and that AMS has made no representation or guarantee about
employing you for a specified period of time.19.
    
    MISCELLANEOUS The waiver or breach of any term or
condition of this Agreement shall not be
deemed a waiver of any other or subsequent
breach, whether of like or different kind.
This Agreement may be executed
simultaneously in two (2) or more
 /s/ SJM
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counterparts, each of which shall be considered an original, but all of which will be one
and the same instrument.20.
    
    RETENTION OF COPY You agree to retain a copy of this Agreement
for future reference.
 By
    
    /s/ Stephen J. McGillStephen J. McGillIts Vice President and General Manager,InternationalDated:   April 7, 2005AMERICAN MEDICAL SYSTEMS, INC.a Delaware corporationBy
    
    /s/ Janet L. DickJanet L. DickIts Vice President, Human Resources
 /s/ SJM
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