Exhibit 10.3
 SEPARATION AGREEMENT
 Agreement Release Janet L. Dick, Employee Employer Company
 Parties
   Employment Transition and Termination . Transition Period Termination Date
 Consideration.
 (a)
    
    Severance Pay. The Employer shall pay the Employee $176,250, which is
equal to nine months of her current annualized base salary in a lump sum with the
first regular payroll following the expiration of all rescission periods after the
Termination Date, subject to applicable withholding taxes. If the Employee has not
commenced full-time employment by March 31, 2010, the Employer will pay the Employee
additional severance in the form of salary continuation, in the
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monthly gross amount of $19,583.33 (the Additional Severance Pay), subject to
applicable taxes and withholding, for each month during the period beginning April 1, 2010
and ending on June 30, 2010, during which the Employee has not commenced full-time
employment; provided the Additional Severance Pay shall be reduced for each month by the
amount fees, if any, the Employee is paid for part-time employment or consulting services
provided in such month. In order to be eligible to receive Additional Severance Pay for any
such month, the Employee must submit written or e-mail confirmation within 10 days of the
end of each month, satisfactory to the Employer, stating that the Employee did not commence
employment and the amount of wages or fees, if any, that the Employee is paid for part-time
employment or consulting services in the prior month. The amount of such Additional
Severance Pay shall be pro rated for the month during with Employee commences new
employment.(b)
    
    2009 EVIP. The Employee will participate in the Companys 2009 Executive Variable
Incentive Plan (2009JEVIP) through the Termination Date and will be paid the bonus payable
under the 2009 EVIP for achieving revenue and net income objectives for the second quarter of
2009 as if she were employed on the date such bonus is paid. In addition, Employee will be
paid 50% of the bonus payable under the 2009 EVIP for achieving the 2009 cash flow objective
as if she were employed on the date such bonus is paid; such amount to be paid at the same
time the Company pays the bonus for achieving the 2009 cash flow objective to other
participants in the 2009 EVIP. The Employee will not be eligible for a bonus under the 2009
EVIP for any period after the Termination Date.(c)
    
    Benefit Continuation. The Employer shall provide the Employee with information and
election materials regarding continuation coverage in accordance with applicable state and/or
federal law. If, after the Termination Date, the Employee elects continuation coverage under
the Employers group Medical and Dental plans in accordance with applicable state and/or
federal law and pays the full amount of the cost of continuation coverage in a timely manner
in accordance with applicable state and/or federal law, then the Employer shall reimburse the
Employee for a portion of the Employees monthly cost of such continuation coverage for the
period ending on the earlier of (a) June 30, 2010, or (b) the date on which the Employee first
becomes eligible to participate in another group health plan maintained by a future employer
of Employee providing benefits to the Employee and her eligible family members. The portion
of the cost of continuation coverage for which the Employer shall reimburse the Employee is
the portion in excess of that portion the Employee would have been responsible had the
Employees termination of employment not occurred. Employee will be reimbursed on a monthly
basis as soon as practicable after the date the Employer has verified with the third party
COBRA administrator that 100% of the prior months COBRA premium has been paid by the
Employee.(d)
    
    Outplacement and Career Counseling Services. Employer shall make available to
Employee outplacement and career counseling services of up to $15,000 during the one year
period after the Termination Date.
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(e)
    
    Vacation/Floating Holidays/United Way Days. The Employer will pay the
Employee for the Employees accrued and unused vacation/floating holidays/United Way
days, as of the Termination Date.(f)
    
    Stock Options. The Employer and the Employee acknowledge and agree
that, as of the Termination Date, Employee holds vested and unvested options to
purchase shares of Common Stock of American Medical Systems Holdings, Inc., as set
forth in the stock option schedule attached hereto (assuming Employee does not
exercise any such vested options prior to the Termination Date). All such vested
options shall remain exercisable until and expire at the close of business on March
31, 2010. All such unvested options will be forfeited.(g)
    
    Laptop Computer and PDA. Employee shall be permitted to keep the
laptop computer and PDA provided to her by the Company after the Companys information
technology group has removed all Company data, files and images from such laptop and
PDA.
 Compliance with Prior Agreements . CIC Agreement
 Release.
 Stipulation of No Charges .
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Non-Disparagement .
 Non-Admissions .
 Invalidity .
 Return of All Property and Commitment to Cooperate in Transition .
 Withholding For Amounts Owed to Employer .
 Voluntary and Knowing Action .
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Entire Agreement .
 Invalidity and Severability.
 Governing Law .
 Janet L. DickJune 8, 2009
    /s/ Janet L. DickAMERICAN MEDICAL SYSTEMS, INC.June 9, 2009
    By:
    /s/ Anthony P. Bihl, IIIAnthony P. Bihl, IIIPresident and Chief Executive Officer 5




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EXHIBIT A
 RELEASE
 1.
    
    Definitions. I intend all words used in this Release to have their plain meanings in
ordinary English. Technical legal words are not needed to describe what I mean. Specific
terms I use in this Release have the following meanings:
 (a)
    
    I, me, and my include both me, Janet L. Dick and anyone who has or
obtains any legal rights or claims through me.(b)
    
    Company, as used in this Release, shall at all times mean American
Medical Systems, Inc., and its respective parent and/or subsidiary corporations,
affiliates, successors, predecessors, shareholders, present and/or former officers,
directors, agents, employees, and attorneys, whether in their individual or official
capacities, benefit plans and plan administrators, and insurers.(c)
    
    My Claims mean any and all of the actual or potential claims of any
kind whatsoever I have now against the Company, regardless of whether I now know about
those claims, that are in any way related to my employment with or separation
(termination of employment) from the Company, including, but not limited to, claims
for invasion of privacy; breach of written or oral, express or implied, contract;
fraud or misrepresentation; the Age Discrimination in Employment Act of 1967, as
amended, (ADEA), the Older Workers Benefit Protection Act of 1990 (OWBPA), Title
VII of the Civil Rights Act of 1964 (Title VII), the Americans with Disabilities Act
(ADA), the Family Medical Leave Act (FMLA), the Employee Retirement Income
Security Act of 1974 (ERISA), as amended, Equal Pay Act (EPA), the Worker
Adjustment and Retraining Notification Act (WARN), the Minnesota Human Rights Act,
Minnesota Stat. § 3 63 A et seq., Minnesota Statutes § 181 et seq.,
and any other federal, state, or local statute, law, rule, regulation, ordinance or
order. This includes, but is not limited to, claims for violation of any civil
rights laws based on protected class status; claims for discrimination, harassment,
assault, battery, defamation, intentional or negligent infliction of emotional
distress, breach of the covenant of good faith and fair dealing, promissory
estoppel, negligence,violation of public policy, and all other claims for
unlawful employment practices, and all other common law or statutory claims.
 2.
    
    Agreement to Release My Claims. Except as stated in Paragraph 5, I agree to release
(give up) and waive all My Claims against the Company. In exchange for my agreement to release
My Claims, I am receiving satisfactory consideration (compensation) from Company to which I am
not otherwise entitled by law, contract, or under any Company policy. The consideration I am
receiving is a full and fair payment for the release of all My Claims. The Company does not
owe me anything in addition to what I will be receiving.3.
    
    Older Workers Benefit Protection Act. I understand and have been advised that the
above release of My Claims is subject to the terms of the Older Workers Benefit Protection Act
(OWBPA). The OWBPA provides that an individual cannot waive a
 6




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right or claim under the Age Discrimination in Employment Act (ADEA) unless the waiver is
knowing and voluntary. I agree that I am signing this Release voluntarily, and with full
knowledge of its consequences. I understand that the Company is giving me at least
twenty-one (21) days from the date I received a copy of this Release to decide whether I
want to sign it. I acknowledge that I have been advised to use this time to consult with an
attorney about the effect of this Release. If I sign this Release before the end of the
twenty-one (21) day period it will be my personal, voluntary decision to do so, and will be
done with full knowledge of my legal rights.I agree that material and/or immaterial changes
to this Release will not restart the running of this consideration period.4.
    
    Exclusions from Release. My Claims do not include my rights, if any, to claim the
following: Unemployment Insurance benefits; claims for my vested post-termination benefits
under any 401(k) or similar retirement benefit plan; my COBRA rights; my rights to enforce the
terms of this Release; or my rights to assert claims that are based on events occurring after
this Release becomes effective. In addition:
 (a)
    
    Nothing in this Release interferes with my right to file a charge with the
Equal Employment Opportunity Commission (EEOC), or participate in any manner in an
EEOC investigation or proceeding under Title VII, the ADA, the ADEA, or the EPA. I,
however, understand that I am waiving my right to recover individual relief including,
but not limited to, back pay, front pay, reinstatement, attorneys fees, and/or
punitive damages, in any administrative or legal action whether brought by the EEOC, by
me, or any other party.(b)
    
    Nothing in this Release interferes with my right to challenge the knowing and
voluntary nature of this Release under the ADEA and/or OWBPA.(c)
    
    Nothing in this Release limits any rights that I would otherwise have to be
indemnified by the Employer, in my capacity as an officer or employee of the Employer,
under the Employers Certificate of Incorporation, Bylaws, directors and officers
insurance policy, Section 145 of the Delaware General Corporation Law or any
indemnification agreement between the Company and me.(d)
    
    I agree that the Company reserves any and all defenses, which it has or might
have against any claims brought by me. This includes, but is not limited to, the
Companys right to seek available costs and attorneys fees, and to have any monetary
award granted to me, if any, reduced by the amount of money that I received in
consideration for this Release.
 4.
    
    Right to Rescind and/or Revoke. I understand that I have the right to rescind this
Release only insofar as it extends to potential claims under the Age Discrimination in
Employment Act (ADEA) by written notice to the Company within seven (7) calendar days
following my signing this Release, and within fifteen (15) calendar days as to waiver of
claims under the Minnesota Human Rights Act. Any such rescission must be
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in writing and hand-delivered to the Company or, if sent by mail, postmarked within the
applicable time period, sent by certified mail, return receipt requested, and addressed as
follows:
 (a)
    
    post-marked within the seven (7) or fifteen (15) day period;(b)
    
    properly addressed to Anthony P. Bihl, III, President and Chief Executive
Officer, American Medical Systems, Inc., 10700 Bren Road West,
Minnetonka, MN 55343-9679,and(c)
    
    sent by certified mail, return receipt requested.
 I understand that the payment I am receiving for settling and releasing My Claims is
contingent upon my agreement to be bound by the terms of this Release. Accordingly, if I
decide to revoke this Release, I understand that I am not entitled to the payments offered
in the attached Settlement Agreement.
 6.
    
    I Understand the Terms of this Release. I have had the opportunity to read this
Release carefully and understand all its terms. I have been advised of my right to review
this Release with my own attorney. In agreeing to sign this Release, I have not relied on any
statements or explanations made by the Company or their attorneys. I understand and agree
that this Release and the attached Separation Agreement, and any agreement referenced in
Section 3 of the Separation Agreement, contain all the agreements between the Company and me.
We have no other written or oral agreements.
 Dated: 6-8-09
    /s/ Janet L. DickJanet L. Dick 8




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EXHIBIT A
 RELEASE
 1.
    
    Definitions. I intend all words used in this Release to have their plain meanings
in ordinary English. Technical legal words are not needed to describe what I mean. Specific
terms I use in this Release have the following meanings:
 (a)
    
    I, me, and my include both me, Janet L. Dick and anyone who has or
obtains any legal rights or claims through me.(b)
    
    Company, as used in this Release, shall at all times mean American
Medical Systems, Inc., and its respective parent and/or subsidiary corporations,
affiliates, successors, predecessors, shareholders, present and/or former officers,
directors, agents, employees, and attorneys, whether in their individual or official
capacities, benefit plans and plan administrators, and insurers.(c)
    
    My Claims mean any and all of the actual or potential claims of any
kind whatsoever I have now against the Company, regardless of whether I now know about
those claims, that are in any way related to my employment with or separation
(termination of employment) from the Company, including, but not limited to, claims
for invasion of privacy; breach of written or oral, express or implied, contract;
fraud or misrepresentation; the Age Discrimination in Employment Act of
1967, as amended, (ADEA), the Older Workers Benefit Protection Act of 1990
(OWBPA), Title VII of the Civil Rights Act of 1964 (Title VII), the Americans with
Disabilities Act (ADA), the Family Medical Leave Act (FMLA), the Employee
Retirement Income Security Act of 1974 (ERISA), as amended, Equal Pay Act (EPA),
the Worker Adjustment and Retraining Notification Act (WARN), the Minnesota Human
Rights Act, Minnesota Stat. § 3 63A et sec^, Minnesota Statutes § 181 et seg., and any
other federal, state, or local statute, law, rule, regulation, ordinance or order.
This includes, but is not limited to, claims for violation of any civil rights laws
based on protected class status; claims for discrimination, harassment, assault,
battery, defamation, intentional or negligent infliction of emotional distress, breach
of the covenant of good faith and fair dealing, promissory estoppel, negligence,
violation of public policy, and all other claims for unlawful employment
practices, and all other common law or statutory claims.
 2.
    
    Agreement to Release My Claims. Except as stated in Paragraph 5, I agree to release
(give up) and waive all My Claims against the Company. In exchange for my agreement to
release My Claims, I am receiving satisfactory consideration (compensation) from Company to
which I am not otherwise entitled by law, contract, or under any Company policy. The
consideration I am receiving is a full and fair payment for the release of all My Claims. The
Company does not owe me anything in addition to what I will be receiving.
 9




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3.
    
    Older Workers Benefit Protection Act. I understand and have been advised that the
above release of My Claims is subject to the terms of the Older Workers Benefit Protection
Act (OWBPA). The OWBPA provides that an individual cannot waive a right or claim under the
Age Discrimination in Employment Act (ADEA) unless the waiver is knowing and voluntary. I
agree that I am signing this Release voluntarily, and with full knowledge of its
consequences. I understand that the Company is giving me at least twenty-one (21) days from
the date I received a copy of this Release to decide whether I want to sign it. I
acknowledge that I have been advised to use this time to consult with an attorney about the
effect of this Release. If I sign this Release before the end of the twenty-one (21) day
period it will be my personal, voluntary decision to do so, and will be done with full
knowledge of my legal rights.I agree that material and/or immaterial changes to this
Release will not restart the running of this consideration period.4.
    
    Exclusions from Release. My Claims do not include my rights, if any, to claim the
following: Unemployment Insurance benefits; claims for my vested post-termination benefits
under any 401(k) or similar retirement benefit plan; my COBRA rights; my rights to enforce the
terms of this Release; or my rights to assert claims that are based on events occurring after
this Release becomes effective. In addition:
 (a)
    
    Nothing in this Release interferes with my right to file a charge with the
Equal Employment Opportunity Commission (EEOC), or participate in any manner in an
EEOC investigation or proceeding under Title VII, the ADA, the ADEA, or the EPA. I,
however, understand that I am waiving my right to recover individual relief including,
but not limited to, back pay, front pay, reinstatement, attorneys fees, and/or punitive
damages, in any administrative or legal action whether brought by the EEOC, by me, or
any other party.(b)
    
    Nothing in this Release interferes with my right to challenge the knowing and
voluntary nature of this Release under the ADEA and/or OWBPA.(c)
    
    Nothing in this Release limits any rights that I would otherwise have to be
indemnified by the Employer, in my capacity as an officer or employee of the Employer,
under the Employers Certificate of Incorporation, Bylaws, directors and officers
insurance policy, Section 145 of the Delaware General Corporation Law or any
indemnification agreement between the Company and me.(d)
    
    I agree that the Company reserves any and all defenses, which it has or might
have against any claims brought by me. This includes, but is not limited to, the
Companys right to seek available costs and attorneys fees, and to have any monetary
award granted to me, if any, reduced by the amount of money that I received in
consideration for this Release.
 5.
    
    Right to Rescind and/or Revoke. I understand that I have the right to rescind this
Release only insofar as it extends to potential claims under the Age
Discrimination in Employment Act (ADEA) by written notice to the Company within seven (7)
calendar days following my signing this Release, and within fifteen
 10




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(15) calendar days as to waiver of claims under the Minnesota Human Rights Act. Any such
rescission must be in writing and hand-delivered to the Company or, if sent by mail,
postmarked within the applicable time period, sent by certified mail, return receipt
requested, and addressed as follows:
 (a)
    
    post-marked within the seven (7) or fifteen (15) day period;(b)
    
    properly addressed to Anthony P. Bihl, III, President and Chief Executive
Officer, American Medical Systems, Inc., 10700 Bren Road West,
Minnetonka, MN 55343-9679,and(c)
    
    sent by certified mail, return receipt requested.
 I understand that the payment I am receiving for settling and releasing My Claims is
contingent upon my agreement to be bound by the terms of this Release. Accordingly, if I
decide to revoke this Release, I understand that I am not entitled to the payments offered
in the attached Settlement Agreement.I Understand the Terms of this Release. I have had the opportunity to read
this Release carefully and understand all its terms. I have been advised of my right to
review this Release with my own attorney. In agreeing to sign this Release, I have not
relied on any statements or explanations made by the Company or their attorneys. I
understand and agree that this Release and the attached Separation Agreement, and any
agreement referenced in Section 3 of the Separation Agreement, contain all the agreements
between the Company and me. We have no other written or oral agreements.
 Dated: 6-30-09
    /s/ Janet L. DickJanet L. Dick 11