Exhibit 10.26


 


REFORMATION AGREEMENT


 


This Reformation Agreement (“Agreement”) is made an entered into
by and between AGA Medical Corporation, a Minnesota corporation (the “Company”),
and Ronald Lund of 9002 Riley Lake Rd., Eden Prairie, MN 55347 (the “Executive”),
dated as of the 30th day of December,
2008.


 


WHEREAS, the Executive and the Company entered into that certain
Employment Agreement, effective July 1, 2008 (the “Employment Agreement”);
and


 


WHEREAS, the parties desire to acknowledge and clarify the terms of the
Employment Agreement relating to the stock options referenced therein.


 


NOW, THEREFORE, in consideration of and reliance upon the mutual
promises, terms, provisions and conditions set forth in this Agreement, the
parties hereby agree:


 


1.             Definitions.  The capitalized terms of this Agreement shall
be defined as set forth in the Employment Agreement unless otherwise modified
herein.


 


2.             Stock
Options.  The first paragraph of Paragraph
4(b) is reformed to read, effective as of July 1, 2008, as follows:


 


The Company shall grant
Executive stock options to purchase 300,000 additional pre-IPO shares of Class
B common stock of the Company (“Options”) which shall be reverse split,
if applicable, on or before the effective date of the Company’s initial public
offering.  The Options shall consist of
the maximum amount of incentive stock options as permitted by law and the
balance of the Options shall consist of nonqualified stock options.  The Options shall be granted on the earlier
of (i) the effective date of the Company’s initial public offering and (ii)
December 31, 2008 (the “Grant Date”). 
The Options will have a ten-year term and an exercise price equal to the
fair market value of the underlying Class B common stock on the Grant
Date.  The Options shall be subject to
vesting of one-third of the total option shares granted per year with the first
one-third of option shares vesting on the anniversary date of the Effective
Date of the Employment Agreement and each subsequent one-third of option shares
vesting on each anniversary date thereafter subject to rounding in the
Company’s discretion.  The Options will
be subject to the terms and conditions of the 2006 Equity Investment Plan and
applicable Form of Stock Option Agreement, as they may be amended from time to
time by the Compensation Committee of the Board in its sole discretion.  Upon a Change of Control, the Options and all
prior awards of options granted to Executive to purchase shares of Class B
common stock of the Company will automatically vest provided Executive is
employed at the time of the Change of Control. 
Options and shares of Class B common stock underlying the Options shall
not have voting rights and shall have only those rights as determined by the
Compensation Committee of the Board in its sole discretion.


 


3.             Continuing
Effect of Employment Agreement.  This
Agreement shall not constitute an amendment or waiver of any other provision of
the Employment Agreement


 

















 


or any other agreement between the parties
not expressly referred to herein.  Except
as expressly amended hereby, the provisions of the Employment Agreement shall
remain in full force and effect.


 


IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the Company, by its duly authorized representative, and by
Executive, as of the date first above written.


 


	
  THE EXECUTIVE:

  	
  AGA MEDICAL CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Ronald Lund

  	
   

  	
  By:

  	
  /s/ John Barr

  
	
  Ronald Lund

  	
  John Barr

  
	
   

  	
  Its: President and CEO

  
				



 


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