Exhibit 10.3


MGC DIAGNOSTICS CORPORATION

EXECUTIVE EMPLOYMENT AGREEMENT


          THIS
AGREEMENT (“Agreement”) is entered into as of June 1, 2014 by and between MGC
Diagnostics Corporation (the “Company”), and Wesley W. Winnekins (the “Executive”).


          WHEREAS,
the Company employs the Executive to render services for the Company subject to
the terms and conditions set forth in this Agreement, and Executive desires to
be employed by the Company subject to these terms and conditions. 


          NOW,
THEREFORE, in consideration of the promises of the Company and Executive set
forth below, the Company and Executive agree as follows:


          1.          Employment.
The Company hereby employs Executive and Executive accepts employment as Chief
Operating Officer and Chief Financial Officer (“COO/CFO”) of the Company, with
additional direct responsibility for Finance and Accounting, Global Operations
(Manufacturing, Regulatory and Information Technology) and Human Resources and
Administration.


          2.          Term.
Subject to Executive’s full compliance with Section 3 and subject to the
provisions of Section 6, Executive’s employment under this Agreement is for no
specific term and is “at will,” unless either party gives written notice of
termination to the other in accordance with Section 6. 


          3.          Position
and Duties.


          3.1        Service
with Company. During the term of this Agreement, Executive agrees to
perform such reasonable employment duties for the Company as shall arise in
connection with his position as COO/CFO, or as otherwise directed by the Chief
Executive Officer as set forth in the job description provided to Executive,
and attached to this Agreement, which may be modified from time to time.


          3.2        Performance
of Duties. Executive agrees to serve the Company faithfully and to the best
of his ability and to devote his full time, attention and efforts to the
business and affairs of the Company during the term of this Agreement. The
Executive warrants and represents to the Company that he has no contractual
commitments that will interfere with his obligations set forth in this
Agreement, and that during the term of this Agreement, he will not render or
perform services for any other corporation, firm, entity or person that are
inconsistent with the provisions of this Agreement, and that are not authorized
by the Company.


          3.3        Board
Service. The Executive agrees that he will not serve on the Board of
Directors of any other profit or non-profit company without prior Board
approval. 


          4.          Compensation.


          4.1        Base
Salary. During the term of this Agreement, as compensation for all services
to be rendered by Executive under this Agreement, the Company will pay to
Executive a Base Salary (“Base Salary” means regular cash compensation paid on
a periodic basis exclusive of benefits, bonuses or incentive payments) of Two
Hundred Forty Five Thousand and No/100 Dollars ($245,000). The Company will pay
the Base Salary in accordance with normal Company payroll practices, subject to
state and federal taxes and any other applicable withholdings. The Base Salary
will be reviewed and adjusted as may be determined from time to time by the
Board of Directors.






          4.2        Management
Incentive Program. Executive will be eligible to participate in the
Company’s 2014 Management Incentive Plan and successor annual plans.
Executive’s participation in these plans will be subject to the terms and
provisions of these plans. The amount and criteria for determination of
Executive’s bonus and incentive compensation in the Annual Management Incentive
Plan program will be solely within the discretion of the Board of Directors and
the Compensation Committee, which may be amended from time to time by the
Board.


          4.3        Equity
Participation. The Company agrees to grant to Executive, and has granted
Executive, a restricted stock grant of 5,000 shares, one-third of which will
vest on each subsequent one-year anniversary of June 1, 2014, but which will
not accelerate upon termination for any reason. Executive will be entitled to
participate in the Company’s 2007 Stock Incentive Plan and the Company agrees
to grant to Executive, and has granted Executive, an initial grant of 5,000
shares, one third of which will vest on each subsequent one year anniversary of
June 1, 2014, unless otherwise determined by the Board.


          4.4        Fringe
Benefits. In addition to the compensation payable to Executive as provided
in this section, Executive will be entitled to Personal Time Off (“PTO”) in
accordance with the Company’s policies, subject to the terms or any
modifications the Board of Directors may approve. To the extent available or
offered, Executive will be entitled to participate in all other benefit
programs offered by the Company to its employees, subject to terms as the Board
of Directors may approve, including but not limited to, any medical, dental or
other health plan, pension plan, profit-sharing plan and life insurance plan
that the Company may adopt or maintain, any of which may be changed, terminated
or eliminated by the Company at any time in the exclusive discretion of the
Board of Directors.


          4.5        Business
Expenses. The Company will pay or reimburse Executive for all reasonable
and necessary out-of-pocket expenses incurred by him for the benefit of the
Company in the performance of his duties under this Agreement, subject to
compliance by Executive with the Company’s policies for expense reimbursements.


          5.          Confidentiality,
Invention Assignment, and Non-Competition. Executive executed a
Confidentiality, Invention Assignment and Non-Competition Agreement with
Medical Graphics Corporation, et al. on January 31, 2013, (attached hereto)
which Executive acknowledges and reaffirms and agrees that it will remain in
effect and not be superseded by anything in this Agreement.


          6.          Termination.


          6.1        Notice.
Executive’s Employment may be terminated by either party at any time or for no
reason, but Executive must give the Company at least 90 days written notice of
resignation, subject to the Company’s power to waive all or any such portion of
this notice requirement.


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          6.2        “Cause”
Defined.


                       (a)          Executive
has breached the provisions of the Confidentiality, Invention Assignment, and
Non-Competition Agreement referenced in Section 5 of this Agreement in any
respect or materially breached any other provision of this Agreement;


                       (b)          Executive
has engaged in gross misconduct;


                       (c)          Executive
has consistently failed to meet the financial and operating goals of the
Executive’s area of responsibility as defined in Executive’s job description
and Annual Work Plan;


                       (d)          Executive
has failed to substantially perform his duties as an officer or employee of the
Company;


                       (e)          Executive
has committed fraud, misappropriation or embezzlement in connection with the
Company’s business, or has caused substantive harm to the reputation of the
Company through his actions;


                       (f)          Executive
has been convicted or has pleaded nolo contendere to an act or failure to act
constituting a felony or gross misdemeanor under federal or state law that is
injurious to the Company or its reputation, or that impairs Executive’s ability
to substantially perform his duties for the Company;


                       (g)          Death
of Executive, or disability of Executive for an aggregate of 180 days during a
12-month period.


          6.3        Effect
of Termination. Notwithstanding any termination of this Agreement,
Executive, in consideration of his employment thereunder to the date of such
termination will remain bound by the provisions of this Agreement that
specifically relate to periods, activities or obligations upon or subsequent to
the termination of Executive’s employment.


          6.4        Pay
Upon Termination. If Executive is terminated by the Company without Cause,
and providing the Executive executes a general release of claims against the
Company and is otherwise in compliance with the terms of this Agreement, the
Company will pay Executive the following compensation:


                       (a)          If
the Executive has been employed in his position with the Company for up to
three (3) years, the Company will pay the Executive an amount equivalent to six
(6) months of Executive’s Base Compensation immediately prior to termination;


                       (b)          If
Executive has been in his position with the Company for more than three (3)
years, but less than six (6) years, the Company will pay the Executive an
amount equivalent to twelve (12) months of Executive’s Base Compensation;


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                       (c)          If
Executive elects COBRA continuation upon termination of employment, Company
will pay Executive for the Employer’s portion of the premium cost during the
time Executive remains eligible under COBRA and is receiving Base Compensation
under either paragraph (a) or (b) of this Section 6.4, the method of such
payment to be determined by the Company.


                       (d)          After
six (6) years of employment, the Company will pay no compensation to Executive
upon termination.


                       (e)          Bonuses
earned but unpaid at the termination date will be at the discretion of the
Board. Bonuses will not be prorated for a partial year.


                       (f)          The
method of payment, whether lump sum or periodic, will be at the sole discretion
of the Company. Nothing in this Section will operate as a guarantee of
employment for any particular term.


          6.5        Surrender
of Records and Property. Upon termination of his employment with the
Company, Executive will deliver promptly to the Company all records, manuals,
books, blank forms, documents, letters, memoranda, notes, notebooks, reports,
data, tables, calculations or copies thereof, computers, cellular phones or any
other equipment that are the property of the Company or that relate in any way
to the business products, practices or techniques of the Company, and all other
property, trade secrets and confidential information of the Company, including,
but not limited to, all documents that in whole or in part contain any trade
secrets, proprietary or Confidential Information of the Company, that in any of
the cases are in his possession or under his control.


          7.          Change
in Control. The Company and Executive agree that they are bound by the
terms of the Change in Control Agreement executed by the parties on February 4,
2013, attached and made a part of this Agreement as Exhibit A.


          8.          Miscellaneous.


          8.1        Arbitration.


                       (a)          Executive
agrees that any dispute or controversy arising out of, relating to, or in
connection with this Agreement, or the interpretation, validity, construction,
performance, breach, or termination thereof, shall be settled by binding
arbitration to be held in Minneapolis, Minnesota. The Company, on the one hand,
and the Executive, on the other hand, shall each select one (1) arbitrator,
each of whom must be independent and experienced in business law. The two (2) arbitrators
so selected shall select a third (3rd) arbitrator. The arbitrators may grant
injunctions or other relief in such dispute or controversy. The decision of the
arbitrators will be final, conclusive and binding on the parties to the
arbitration. Judgment may be entered on the arbitrators’ decision in any court
having jurisdiction.


                       (b)          The
arbitrator(s) shall apply Minnesota law to the merits of any dispute or claim,
without reference to rules of conflicts of law. The arbitration proceedings
shall be governed by federal arbitration law, without reference to state
arbitration law. Executive hereby consents to the personal jurisdiction of the
state and federal courts located in the State of Minnesota for any action or
proceeding arising from or relating to this Agreement or relating to any
arbitration in which the parties are participants.


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                       (c)          EXECUTIVE
HAS READ AND UNDERSTANDS THIS SECTION 8.1, WHICH DISCUSSES ARBITRATION.
EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EXECUTIVE AGREES TO
SUBMIT ANY CLAIMS ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH THIS
AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH
OR TERMINATION THEREOF TO BINDING ARBITRATION, AND THAT THIS ARBITRATION CLAUSE
CONSTITUTES A WAIVER OF EXECUTIVE’S RIGHT TO A JURY TRIAL AND RELATES TO THE
RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE
RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, DISCRIMINATION CLAIMS.


          8.2        Prior
Agreements. This Agreement contains the entire agreement of the parties
relating to the employment of Executive by the Company and the ancillary
matters discussed therein and supersedes all prior agreements and
understandings with respect to such matters, and the parties thereto have made
no agreements, representations or warranties relating to such employment or
ancillary matters except as expressly set forth herein.


          8.3        Withholding
Taxes. The Company may withhold from any benefits payable under this
Agreement all federal, state, city or other taxes that are required pursuant to
any law or governmental regulation or ruling.


          8.4        Amendments.
No amendment or modification of this Agreement will be effective unless made in
writing and signed by both Executive and the Company.


          8.5        No
Waiver. No term or condition of this Agreement may be deemed to have been
waived, nor will there be any estoppel to enforce any provision of this
Agreement, except by a statement in writing signed by the party against whom
enforcement of the waiver or estoppel is sought. Any written waiver will not be
deemed a continuing waiver unless specifically stated, will operate only as to
the specific term or condition waived and will not constitute a waiver of such
term or condition for the future or as to any act other than that specifically
waived.


          8.6        Severability.
To the extent any provision of this Agreement is found to be invalid or unenforceable,
it will be considered deleted from this Agreement and the remainder of the
Agreement will be unaffected and will continue in full force and effect. 


          8.7        Assignment.
This Agreement is not assignable, in whole or in part, by the Executive.


          8.8        Counterparts.
This Agreement may be executed in any number of counterparts, each of which
will be deemed an original, but all of which constitute one and the same
instrument.


          8.9        Captions
and Headings. The captions and paragraph headings used in this Agreement
are for convenience of reference only, and do not affect the construction or
interpretation of this Agreement or any of the provisions thereof.


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          IN
WITNESS WHEREOF, Executive and the Company have executed this Agreement as of
the date set forth in the first paragraph.


	
  

 	
  

 	
  

 	
  

 
	
  

 	
 MGC
 DIAGNOSTICS CORPORATION

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By

 	
 /s/ Mark A. Sheffert

 
	
  

 	
  

 	
 Its 

 	
  Chairman of the Board

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 EXECUTIVE

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 /s/ Wesley W. Winnekins

 
	
  

 	
 Wesley W. Winnekins

 


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