Exhibit 10.16









                              POSSIS MEDICAL, INC.

                                CHANGE IN CONTROL
                              TERMINATION PAY PLAN



                                Amended Effective
                                December 12, 2001

<PAGE>

                              POSSIS MEDICAL, INC.

                                CHANGE IN CONTROL
                              TERMINATION PAY PLAN

                                TABLE OF CONTENTS


                                                                   Page

SECTION 1.        INTRODUCTION                                       4

SECTION 2.        PARTICIPATION                                      4

SECTION 3.        TERMINATION OF EMPLOYMENT                          4
         3.1.     Notice of Termination
         3.2.     Participant's Termination Rights

SECTION 4.        TERMINATION PAYMENT                                5
         4.1.     Qualification
         4.2.     Amount
                  4.2.1.   Class I Participants
                  4.2.2.   Class II Participants
                  4.2.3.   Class III Participants
                  4.2.4.   Class IV Participants
                  4.2.5.   Class V Participants
                  4.2.6.   Sales Personnel Compensation
         4.3.     Cash Transaction Bonus
         4.4.     Certain Additional Payments by the Company
         4.5      Legal Fees and Expenses

SECTION 5.        28OG LIMITATON                                    11

SECTION 6.        AMENDMENT OR TERMINATION OF THE PLAN              12

SECTION 7.        MISCELLANEOUS PROVISIONS                          12
         7.1.     Nonexclusivity of Rights
         7.2.     Successors
         7.3.     Payments as Compensation
         7.4.     Notice
         7.5.     Governing Law
         7.6.     Validity
         7.7.     Employment
         7.8.     Termination Prior to a Change in Control

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                                                                   Page


SECTION 8.        CLAIMS PROCEDURE                                  13
         8.1.     General
         8.2.     Making a Claim
         8.3.     Requesting Review of a Denied Claim
         8.4.     Exhaustion of Administrative Remedies
         8.5      Decisions

SECTION 9.        DEFINITIONS                                       14
         9.1.     Cause
         9.2.     Change in Control
         9.3.     Code
         9.4.     Continuing Director
         9.5.     Date of Termination
         9.6.     Effective Date
         9.7.     Employer
         9.8.     Good Reason
         9.9.     Notice of Termination
         9.10.    Participant
         9.11.    Plan
         9.12.    Plan Year
         9.13     Termination of Employment


<PAGE>


SECTION 1

INTRODUCTION

     Effective September 15, 1999, Possis Medical, Inc., a Minnesota corporation
(hereinafter  sometimes  referred to as  "Employer"  or the  "Company"),  hereby
creates a change in  control  termination  pay plan for the  benefit  of certain
employees of the Employer in the event of a Change in Control. Capitalized terms
used herein shall have the meaning provided in Section 9.

     The Board of Directors of the Company (the "Board),  has determined that it
is in the best interests of the Company and its  shareholders to assure that the
Company  will  have the  continued  dedication  of its  officers  and  other key
management,  sales and technical  personnel,  notwithstanding  the  possibility,
threat or occurrence  of a Change in Control (as defined  below) of the Company.
The Board  believes it is essential to diminish the  inevitable  distraction  of
these employees by virtue of the personal  uncertainties  and risks created by a
pending or  threatened  Change in Control and to encourage  full  attention  and
dedication  to the  Company  currently  and in the  event of any  threatened  or
pending  Change  in  Control,   and  to  provide   specified   individuals  with
compensation and benefit arrangements upon a Change in Control which ensure that
the  compensation  and  benefits  expectations  of  these  individuals  will  be
satisfied and which are competitive with those of other corporations. Therefore,
in order to accomplish  these  objectives,  the Board has adopted this Change in
Control Termination Pay Plan.


SECTION 2

PARTICIPATION

     All  Participants  in the Plan shall be identified at the discretion of the
Board.  Participants  shall be classified as Class I, Class II, Class III, Class
IV or Class V  Participants.  An employee who has become a Participant  shall be
considered  to  continue  as a  Participant  in the Plan  until  the date of the
Participant's  death or, if earlier,  the date when the Participant is no longer
employed by the Employer or is removed as a Participant at the discretion of the
Board; provided, however, that a Participant who has a Termination of Employment
within 24 months  following the date of a Change in Control will not cease to be
a Participant.


SECTION 3

TERMINATION OF EMPLOYMENT

     3.1.  Notice of Termination.  Any purported  termination of a Participant's
employment  by the  Employer  or the  Participant,  including a  Termination  of
Employment as defined herein,  (other than by reason of the Participant's death)
within  twenty-four (24) months following the month in which a Change in Control
occurs,  shall be  communicated  by a Notice of  Termination  to the  other.  No
purported  termination by the Employer of a  Participant's  employment  shall be
effective  if it is not  pursuant  to a  Notice  of  Termination.  Failure  by a
Participant to provide  Notice of Termination  shall not limit any rights of the
Participant  under the Plan except to the extent the  Employer  can  demonstrate
that it suffered actual damages by reason of such failure.

<PAGE>

     3.2.  Participant's  Termination Rights. A Participant's right to terminate
his or her employment pursuant to the terms of the Plan shall not be affected by
the Participant's  incapacity due to physical or mental illness. A Participant's
continued employment shall not constitute consent to, or a waiver of rights with
respect to, any circumstance  constituting  Good Reason pursuant to the terms of
the Plan. Termination by a Participant of the Participant's  employment for Good
Reason  shall  constitute  termination  for Good Reason for all  purposes of the
Plan,  notwithstanding  that the  Participant may also thereby be deemed to have
"retired" under any applicable retirement programs of the Employer.


SECTION 4

TERMINATION PAYMENT

     4.1. Qualification.  To qualify for a termination payment under the Plan, a
Participant  must (a) be a Participant  as of the date of the Change in Control,
and (b) have a Termination of Employment  within 24 months following a Change in
Control.

     4.2.  Amount.  Subject to the eligibility  requirement set forth in Section
4.1,  and the  limitations  set forth in Section 4.4 and Section 5,  termination
payments  for Class I, Class II,  Class III,  Class IV and Class V  Participants
shall be determined as follows:

     4.2.1. Class I Participants.  Termination payments shall be made to a Class
I  Participant  in an amount equal to the sum of (a)  thirty-six  (36) times the
Class I  Participant's  highest  monthly  base  compensation  during the six (6)
months immediately before the Date of Termination;  and (b) all annual incentive
payments that the Class I Participant  would have received for the year in which
the Date of Termination occurs, had required performance targets been met, which
shall be deemed to have occurred on the Date of Termination, whether or not they
have occurred or could possibly  occur.  Said payments shall be paid in a single
lump sum,  discounted to present value, or by periodic payments  consistent with
payroll  practices of the Employer  during a term to be determined by the Board.
The manner of payment shall be at the discretion of the Board.

     Additionally,  the Class I  Participant  shall receive the  following:  (a)
until the end of the  thirty-sixth  (36th)  month  following  the month in which
occurs the Class I Participant's Date of Termination,  the Employer will arrange
to provide the Class I Participant  with welfare  benefits  (including  life and
health insurance benefits) and other employee benefits of substantially  similar
design and cost (to the Class I Participant except as otherwise set forth below)
as the welfare  benefits and other  employee  benefits  available to the Class I
Participant  immediately prior to the Notice of Termination or immediately prior
to the date of the  Change  in  Control,  whichever  is  greater;  but  benefits
otherwise  receivable  by the Class I  Participant  pursuant  to this clause (a)
shall be discontinued if the Class I Participant  obtains  full-time  employment
providing  welfare benefits during such period following such  termination;  and
(b)  group   outplacement   counseling   services   up  to   $20,000  in  value.
Notwithstanding the foregoing, the health insurance benefits to be provided to a
Class I Participant  following  the Class I  participant's  Date of  Termination
shall be provided  pursuant to Section  4980B of the  Internal  Revenue  Code of
1986, as amended ("COBRA"), except that the Corporation will continue to pay the
employer portion of the premiums for such coverage,  until the end of the period
of time provided  under COBRA and  thereafter  the  Corporation's  obligation to
provide  health  insurance  benefits  shall  be  limited  to the  obligation  to
contribute to the purchase of a health insurance policy selected and obtained by
the Class I  participant,  by payment to the Class I participant of an amount up
to but not exceeding the Corporation's cost of providing coverage under COBRA at
the time the COBRA  period  expired  (not  including  any  portion  of such cost
contributed by the Class I  participant).  Notwithstanding  the  foregoing,  the
Employer  shall not be  required  to  continue  to provide  disability  benefits
following a Class I Participant's Date of Termination other than with respect to
benefits to which the Class I Participant  became  entitled prior to the Date of
Termination and which are required to be paid following such Date of Termination
in  accordance  with the terms of  applicable  disability  plans or  policies in
effect prior to such Date of Termination.  The Class I Participant  shall not be
required to mitigate  the amount of any payment  provided  for under the Plan by
seeking  other  employment  or  otherwise,  nor shall the amount of any  payment
provided for under the Plan be reduced by any compensation earned by the Class I
Participant  as the result of employment by another  employer  after the Date of
Termination, or otherwise, except as set forth in clause (a) of this paragraph.

<PAGE>

     4.2.2. Class II Participants. Termination payments shall be made to a Class
II Participant in an amount equal to the sum of (a)  twenty-four  (24) times the
Class II  Participant's  highest  monthly base  compensation  during the six (6)
months immediately before the Date of Termination;  and (b) all annual incentive
payments that the Class II Participant would have received for the year in which
the Date of Termination occurs, had required performance targets been met, which
shall be deemed to have occurred on the Date of Termination, whether or not they
have occurred or could possibly  occur.  Said payments shall be paid in a single
lump sum,  discounted to present value, or by periodic payments  consistent with
payroll  practices of the Employer  during a term to be determined by the Board.
The manner of payment shall be at the discretion of the Board.

     Additionally,  the Class II Participant  shall receive the  following:  (a)
until the end of the  twenty-fourth  (24th) month  following  the month in which
occurs the Class II Participant's Date of Termination, the Employer will arrange
to provide the Class II Participant  with welfare  benefits  (including life and
health insurance benefits) and other employee benefits of substantially  similar
design  and cost (to the  Class II  Participant  except as  otherwise  set forth
below) as the welfare  benefits  and other  employee  benefits  available to the
Class  II  Participant  immediately  prior  to  the  Notice  of  Termination  or
immediately  prior to the date of the Change in Control,  whichever  is greater;
but benefits otherwise  receivable by the Class II Participant  pursuant to this
clause (a) shall be discontinued if the Class II Participant  obtains  full-time
employment   providing  welfare  benefits  during  such  period  following  such
termination;  and (b) group  outplacement  counseling  services up to $15,000 in
value.  Notwithstanding  the  foregoing,  the health  insurance  benefits  to be
provided to a Class II participant  following the Class II participant's Date of
Termination  shall be provided pursuant to Section 4980B of the Internal Revenue
Code of 1986, as amended ("COBRA"), except that the Corporation will continue to
pay the employer portion of the premiums for such coverage, until the end of the
period of time provided under COBRA, and thereafter the Corporation's obligation
to provide  health  insurance  benefits  shall be limited to the  obligation  to
contribute to the purchase of a health insurance policy selected and obtained by
the Class II participant, by payment to the Class II participant of an amount up
to but not exceeding the Corporation's cost of providing coverage under COBRA at
the time the COBRA  period  expired  (not  including  any  portion  of such cost
contributed by the Class II  participant).  Notwithstanding  the foregoing,  the
Employer  shall not be  required  to  continue  to provide  disability  benefits
following a Class II Participant's  Date of Termination  other than with respect
to benefits to which the Class II Participant  became entitled prior to the Date
of  Termination  and  which  are  required  to be paid  following  such  Date of
Termination  in  accordance  with the terms of  applicable  disability  plans or
policies in effect prior to such Date of  Termination.  The Class II Participant
shall not be required to mitigate  the amount of any payment  provided for under
the Plan by seeking other  employment or otherwise,  nor shall the amount of any
payment provided for under the Plan be reduced by any compensation earned by the
Class II Participant  as the result of employment by another  employer after the
Date of  Termination,  or  otherwise,  except as set forth in clause (a) of this
paragraph.

<PAGE>

     4.2.3.  Class III  Participants.  Termination  payments  shall be made to a
Class III Participant in an amount equal to the sum of (a) twelve (12) times the
Class III  Participant's  highest monthly base  compensation  during the six (6)
months  immediately  before the Date of  Termination;  (b) all annual  incentive
payments  that the Class III  Participant  would have  received  for the year in
which the Date of Termination occurs, had required performance targets been met,
which shall be deemed to have  occurred on the Date of  Termination,  whether or
not they have occurred or could possibly occur. Said payments shall be paid in a
single lump sum, discounted to present value, or by periodic payments consistent
with payroll  practices of the Employer  during a term to be  determined  by the
Board. The manner of payment shall be at the discretion of the Board.

     Additionally,  the Class III Participant  shall receive the following:  (a)
until the end of the twelfth  (12th) month  following  the month in which occurs
the Class III  Participant's  Date of Termination,  the Employer will arrange to
provide the Class III  Participant  with welfare  benefits  (including  life and
health insurance benefits) and other employee benefits of substantially  similar
design and cost (to the Class III Participant) as the welfare benefits and other
employee  benefits  available to the Class III Participant  immediately prior to
the  Notice of  Termination  or  immediately  prior to the date of the Change in
Control,  whichever is greater;  but benefits otherwise  receivable by the Class
III  Participant  pursuant to this clause (a) shall be discontinued if the Class
II Participant  obtains full-time  employment  providing welfare benefits during
such period following such termination;  and (b) group  outplacement  counseling
services up to $10,000 in value.  Notwithstanding  the  foregoing,  the Employer
shall not be required to continue  to provide  disability  benefits  following a
Class III Participant's  Date of Termination other than with respect to benefits
to  which  the  Class  III  Participant  became  entitled  prior  to the Date of
Termination and which are required to be paid following such Date of Termination
in  accordance  with the terms of  applicable  disability  plans or  policies in
effect prior to such Date of Termination. The Class III Participant shall not be
required to mitigate  the amount of any payment  provided  for under the Plan by
seeking  other  employment  or  otherwise,  nor shall the amount of any  payment
provided for under the Plan be reduced by any  compensation  earned by the Class
III  Participant as the result of employment by another  employer after the Date
of  Termination,  or  otherwise,  except  as set  forth  in  clause  (a) of this
paragraph.

     4.2.4. Class IV Participants. Termination payments shall be made to a Class
IV  Participant in an amount equal to the sum of (a) Nine (9) times the Class IV
Participant's  highest  monthly  base  compensation  during  the six (6)  months
immediately  before the Date of Termination;  (b) all annual incentive  payments
that the Class IV Participant would have received for the year in which the Date
of Termination occurs, had required performance targets been met, which shall be
deemed to have  occurred  on the Date of  Termination,  whether or not they have
occurred or could possibly  occur.  Said payments shall be paid in a single lump
sum,  discounted  to present  value,  or by periodic  payments  consistent  with
payroll  practices of the Employer  during a term to be determined by the Board.
The manner of payment shall be at the discretion of the Board.

<PAGE>

     Additionally,  the Class IV Participant  shall receive the  following:  (a)
until the end of the ninth (12th) month  following the month in which occurs the
Class IV Participant's Date of Termination, the Employer will arrange to provide
the Class IV  Participant  with  welfare  benefits  (including  life and  health
insurance benefits) and other employee benefits of substantially  similar design
and cost  (to the  Class IV  Participant)  as the  welfare  benefits  and  other
employee benefits available to the Class IV Participant immediately prior to the
Notice of Termination or immediately prior to the date of the Change in Control,
whichever  is  greater;  but  benefits  otherwise  receivable  by the  Class  IV
Participant  pursuant to this clause (a) shall be  discontinued  if the Class IV
Participant obtains full-time  employment providing welfare benefits during such
period  following  such  termination;  and  (b)  group  outplacement  counseling
services up to $8,000 in value.  Notwithstanding  the  foregoing,  the  Employer
shall not be required to continue  to provide  disability  benefits  following a
Class IV Participant's  Date of Termination  other than with respect to benefits
to  which  the  Class  IV  Participant  became  entitled  prior  to the  Date of
Termination and which are required to be paid following such Date of Termination
in  accordance  with the terms of  applicable  disability  plans or  policies in
effect prior to such Date of Termination.  The Class IV Participant shall not be
required to mitigate  the amount of any payment  provided  for under the Plan by
seeking  other  employment  or  otherwise,  nor shall the amount of any  payment
provided for under the Plan be reduced by any  compensation  earned by the Class
IV Participant as the result of employment by another employer after the Date of
Termination, or otherwise, except as set forth in clause (a) of this paragraph.

     4.2.5. Class V Participants.  Termination payments shall be made to a Class
V  Participant  in an  amount  equal to the sum of (a) six (6) times the Class V
Participant's  highest  monthly  base  compensation  during  the six (6)  months
immediately  before the Date of Termination;  (b) all annual incentive  payments
that the Class V Participant  would have received for the year in which the Date
of Termination occurs, had required performance targets been met, which shall be
deemed to have  occurred  on the Date of  Termination,  whether or not they have
occurred or could possibly  occur.  Said payments shall be paid in a single lump
sum,  discounted  to present  value,  or by periodic  payments  consistent  with
payroll  practices of the Employer  during a term to be determined by the Board.
The manner of payment shall be at the discretion of the Board.

     Additionally,  the Class V  Participant  shall receive the  following:  (a)
until the end of the sixth (6th) month  following  the month in which occurs the
Class V Participant's Date of Termination,  the Employer will arrange to provide
the  Class V  Participant  with  welfare  benefits  (including  life and  health
insurance benefits) and other employee benefits of substantially  similar design
and cost (to the Class V Participant) as the welfare benefits and other employee
benefits available to the Class V Participant immediately prior to the Notice of
Termination or immediately prior to the date of the Change in Control, whichever
is  greater;  but  benefits  otherwise  receivable  by the  Class V  Participant
pursuant to this  clause (a) shall be  discontinued  if the Class V  Participant
obtains  full-time  employment  providing  welfare  benefits  during such period
following such termination; and (b) group outplacement counseling services up to
$5,000  in value.  Notwithstanding  the  foregoing,  the  Employer  shall not be
required  to  continue  to  provide  disability  benefits  following  a  Class V
Participant's  Date of Termination  other than with respect to benefits to which
the Class V Participant  became  entitled prior to the Date of  Termination  and
which are required to be paid  following  such Date of Termination in accordance
with the terms of  applicable  disability  plans or policies in effect  prior to
such Date of  Termination.  The Class V  Participant  shall not be  required  to
mitigate the amount of any payment  provided for under the Plan by seeking other
employment or otherwise,  nor shall the amount of any payment provided for under
the Plan be reduced by any compensation earned by the Class V Participant as the
result of  employment  by another  employer  after the Date of  Termination,  or
otherwise, except as set forth in clause (a) of this paragraph.

<PAGE>

     4.2.6 Sales Personnel  Compensation.  Notwithstanding the provisions herein
pertaining to the  calculation of  termination  payments to  Participants  under
Sections 4.2.1 - 4.2.5 of the Plan,  payments to sales  personnel  identified as
Participants  shall be as follows:  Termination  payments shall be made to sales
personnel  Participants in an amount equal to the number of months identified in
the Class to which each  Participant  is assigned  times the average base salary
plus commissions earned on a monthly basis during the six (6) months immediately
before the Date of  Termination.  No  additional  incentive  payments or bonuses
shall be included in the calculation of termination payments.

     4.3 Cash  Transaction  Bonus.  In the  event of a Change  in  Control,  and
notwithstanding   their  employment   status  following  a  Change  in  Control,
Participants identified by the Board may receive a Cash Bonus based on the value
of the  Employer  at the time of a Change in  Control.  To qualify for this Cash
Bonus  payment,  the  Participant  must be a  Participant  as of the date of the
Change in Control and must hold the same position,  or have essentially the same
or higher level of responsibility, as held when being named as a Participant.

     The Cash Bonus payments  provided herein shall be paid to senior management
and to such other key management and technical personnel who, in the judgment of
the Board,  made  significant  contributions  to the  growth and  success of the
Corporation and played a vital role in increasing shareholder value, as measured
by the value of the Corporation at the time of the Change in Control.  The Board
shall  create a Cash Bonus Pool for the purpose of funding the cash bonus awards
described  herein.   Said  Cash  Bonus  Pool  shall  be  in  an  amount  between
five-eighths  of one percent  (.625%) and a maximum of four  percent (4%) of the
value of the  Employer at the time of a Change in Control,  as measured by stock
value consistent with the schedules  attached hereto and incorporated  herein by
reference as Schedule C. In addition,  Schedule C also describes the schedule of
intended  beneficiaries  under the Cash Bonus Plan described herein. The list of
intended beneficiaries shall be subject to change at the discretion of the Board
in the event that job  responsibilities,  employment  status or other reasonable
circumstances  support  changes to the identity of name  Participants  or to the
allocation of the bonus pool among Participants.

     4.4 Certain Additional Payments by the Company.

     4.4.1 Anything in this Agreement to the contrary notwithstanding and except
as set forth  below,  in the event it shall be  determined  that any  payment or
distribution by the Company to or for the benefit of a Participant identified by
the Board as eligible for the benefit provided in this Section 4.4 (whether paid
or  payable  or  distributed  or  distributable  pursuant  to the  terms of this
Agreement or otherwise, but determined without regard to any additional payments
required under this Section 4.4 (a "Payment") would be subject to the excise tax
imposed by Code Section  4999 or any interest or penalties  are incurred by said
Participant with respect to such excise tax (such excise tax,  together with any
such interest and penalties,  are  hereinafter  collectively  referred to as the
"Excise Tax"),  then said Participant shall be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after payment of all taxes
(including  any  interest or  penalties  imposed  with  respect to such  taxes),
including,  without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up  Payment,
said  Participant  retains an amount of the Gross-Up Payment equal to the Excise
Tax imposed upon the Payments.

<PAGE>

     4.4.2  Subject  to the  provisions  of  Section  9(c),  all  determinations
required  to be made  under  this  Section  4.4,  including  whether  and when a
Gross-Up  Payment is required  and the amount of such  Gross-Up  Payment and the
assumptions to be utilized in arriving at such  determination,  shall be made by
the Company,  with the input of the Company's  certified public accounting firm,
which shall provide detailed  supporting  calculations to the Participant within
15 business  days of the  receipt of notice  that there has been a Payment.  Any
Gross-Up Payment, as determined pursuant to this Section 9, shall be paid by the
Company  to said  Participant  within a  reasonable  time.  As a  result  of the
uncertainty  in the  application  of Code  Section  4999,  it is  possible  that
Gross-Up  Payments which will not have been made by the Company should have been
made  ("Underpayment"),  consistent  with the  calculations  required to be made
hereunder.  In the event that the  Company  exhausts  its  remedies  pursuant to
Section 4.4.3 and said  Participant  thereafter is required to make a payment of
any Excise Tax, the Company shall determine the amount of the Underpayment  that
has occurred and any such Underpayment shall be promptly paid by the Company.

     4.4.3 Said Participant  shall notify the Company in writing of any claim by
the Internal  Revenue Service that, if successful,  would require the payment by
the Company of the Gross-Up Payment. Such notification shall be given as soon as
practicable  but no later  than ten  business  days after  said  Participant  is
informed in writing of such claim and shall  appraise  the Company of the nature
of such  claim and the date on which such claim is  requested  to be paid.  Said
Participant  shall not pay such  claim  prior to the  expiration  of the  30-day
period  following  the date on which he or she gives such  notice to the Company
(or such  shorter  period  ending on the date  that any  payment  of taxes  with
respect to such claim is due).  If the  Company  notifies  said  Participant  in
writing  prior to the  expiration of such period that it desires to contest such
claim, said participant shall:

     (i) give the Company any  information  reasonably  requested by the Company
relating to such claim;

     (ii) take such  action in  connection  with  contesting  such  claim as the
Company  shall  reasonably  request  in  writing  from time to time,  including,
without limitation, accepting legal representation with respect to such claim by
an attorney reasonably selected by the Company;

     (iii)  cooperate  with the  Company in good  faith in order to  effectively
contest such claim; and

     (iv) permit the Company to participate in any proceedings  relating to such
claim.

     Provided,  however,  that the Company shall bear and pay directly all costs
and  expenses   (including   additional  interest  and  penalties)  incurred  in
connection  with such  contest  and shall  indemnify  and hold said  Participant
harmless,  on an after-tax  basis,  for any Excise Tax or income tax  (including
interest  and  penalties  with  respect  thereto)  imposed  as a result  of such
representation  and payment of costs and  expenses.  Without  limitation  on the
foregoing  provisions  of this  Section  4.4.3,  the Company  shall  control all
proceedings  taken in connection with such contest and, at its sole option,  may
pursue or forgo any and all administrative  appeals,  proceedings,  hearings and
conferences  with the taxing  authority in respect of such claim and may, at its
sole option,  either direct the Participant to pay the tax claimed and sue for a
refund or contest the claim in any permissible  manner, and the said Participant
agrees to prosecute such contest to a  determination  before any  administrative
tribunal,  in a court  of  initial  jurisdiction  and in one or  more  appellate
courts, as the Company shall determine;  provided,  however, that if the Company
directs  said  Participant  to pay such claim and sue for a refund,  the Company
shall  advance  the  amount  of  such  payment  to  said   Participant,   on  an
interest-free basis and shall indemnify and hold said Participant  harmless,  on
an after-tax  basis,  from any Excise Tax or income tax  (including  interest or
penalties  with  respect  thereto)  imposed with respect to such advance or with
respect to any imputed income with respect to such advance; and further provided
that any  extension of the statute of  limitations  relating to payment of taxes
for the taxable year of said  Participant  with respect to which such  contested
amount  is  claimed  to be due is  limited  solely  to  such  contested  amount.
Furthermore,  the  Company's  control of the contest  shall be limited to issues
with respect to which a Gross-Up  Payment  would be payable  hereunder  and said
Participant  shall be  entitled  to settle or  contest,  as the case may be, any
other  issue  raised  by  the  Internal  Revenue  Service  or any  other  taxing
authority.

<PAGE>

     4.4.4 If, after the receipt by said  Participant  of an amount  advanced by
the Company pursuant to Section 4.4.3, the said Participant  becomes entitled to
receive any refund with respect to such claim said participant shall (subject to
the Company's  complying with the requirements of Section 4.4.3) promptly pay to
the  Company  the amount of such  refund  (together  with any  interest  paid or
credited thereon after taxes applicable thereto).  If, after the receipt by said
Participant  of an amount  advanced by the Company  pursuant to Section 4.4.3, a
determination is made the said  Participant  shall not be entitled to any refund
with respect to such claim and the Company does not notify said  Participant  in
writing of its intent to contest such denial of refund  prior to the  expiration
of 30 days after such  determination,  then such  advance  shall be forgiven and
shall not be required to be repaid and the amount of such advance  shall offset,
to the extent thereof, the amount of Gross-Up Payment required to be paid.

     4.5 Legal  Fees and  Expenses.  The  Employer  will pay any legal  fees and
expenses  incurred by a  Participant  in  connection  with any dispute  with any
Federal,  state or local  governmental  agency with respect to benefits  claimed
under the Plan.  If the  Participant  utilizes  arbitration  to resolve any such
dispute,  the  Employer  will pay any legal fees and  expenses  incurred  by the
Participant in connection therewith.


SECTION 5

280G LIMITATION

     The amount of any cash payment to be received by a Participant,  other than
a Participant  identified by the Board as eligible for the benefits  provided in
Section  4.4,  pursuant to the Plan shall be reduced (but not below zero) by the
amount, if any, necessary to prevent any part of any payment or benefit received
or to be  received by the  Participant  in  connection  with a Change in Control
(whether payable pursuant to the terms of the Plan or any other plan,  contract,
agreement or arrangement with the Employer, with any person whose actions result
in a Change in Control of the Employer or with any person  constituting a member
of an "affiliated  group" (as defined in section  280G(d)(5) of the Code)) (such
foregoing   payments  or  benefits   referred  to  collectively  as  the  "Total
Payments"),  from  being  treated as an "excess  parachute  payment"  within the
meaning of section  280G(b) (l) of the Code,  but only if and to the extent such
reduction will also result in, after taking into account all applicable state or
federal  taxes  (computed at the highest  marginal  rate),  including  any taxes
payable pursuant to section 4999 of the Code, a greater after-tax benefit to the
Participant than the after-tax  benefit to the Participant of the Total Payments
computed  without regard to any such  reduction.  For purposes of the foregoing,
(a) no portion of the Total  Payments  shall be taken into account  which in the
opinion  of  tax  counsel  selected  by  the  Employer  and  acceptable  to  the
Participant  does not  constitute  a "parachute  payment"  within the meaning of
section 280G (b) (2) of the Code; (b) any reduction in payments  pursuant to the
Plan shall be computed by taking into  account  that  portion of Total  Payments
which  constitute   reasonable   compensation  within  the  meaning  of  section
28OG(b)(4) of the Code in the opinion of such tax counsel;  (c) the value of any
non-cash  benefit or of any deferred cash payment included in the Total Payments
shall be determined by the Employer in accordance with the principles of section
28OG(d)(4) of the Code; and (d) in the event of any  uncertainty as to whether a
reduction in Total Payments to the Participant is required pursuant to the Plan,
the  Employer  shall  initially  make the  payment  to the  Participant  and the
Participant  shall be required to refund to the Employer any amounts  ultimately
determined not to have been payable under the terms of the Plan.

<PAGE>

SECTION 6

AMENDMENT OR TERMINATION OF THE PLAN

     The Plan may be terminated or amended at any time, at the discretion of the
Board.  Except to the extent  benefits have become payable but have not actually
been paid, the Plan terminates  automatically  on the second  anniversary of the
date of a Change in Control.


SECTION 7

MISCELLANEOUS PROVISIONS

     7.1.  Non-exclusivity of Rights. Nothing in the Plan shall prevent or limit
any  Participant's  continuing or future  participation  in any benefit,  bonus,
incentive,  retirement or other plan or program provided by the Employer and for
which the  Participant  may  qualify,  nor shall  anything  in the Plan limit or
reduce such rights as any  Participant  may have under any other agreement with,
or plan, program, policy or practice of, the Employer.  Amounts which are vested
benefits or which a  Participant  is  otherwise  entitled  to receive  under any
agreement with, or plan,  program,  policy or practice of, the Employer shall be
payable in accordance with such agreement,  plan,  program,  policy or practice,
except as explicitly modified by the Plan.

     7.2. Successors. The Employer will require any successor (whether direct or
indirect,  by  purchase,  merger,   consolidation,   or  otherwise)  to  all  or
substantially  all of the  business  and/or  assets  of the  Employer  or of any
division or subsidiary thereof employing any Participant to expressly assume and
agree to perform  under the terms of the Plan in the same manner and to the same
extent that the Employer would be required to perform if no such  succession had
taken place.  Failure of the Employer to obtain such  assumption  and  agreement
prior to the  effectiveness  of any such succession  shall entitle each affected
Participant to compensation from the Employer in the same amount and on the same
terms as the  Participant  would be entitled  under the Plan if the  Participant
terminated employment for Good Reason following a Change in Control, except that
for  purposes  of  implementing  the  foregoing,  the  date on  which  any  such
succession  becomes effective shall be deemed the Date of Termination and Notice
of Termination shall be deemed to have been given on such date.

     7.3 Payments as  Compensation.  Payments under the Plan shall not be deemed
compensation  for purposes for any  retirement or 401(k) Plan  maintained by the
Company.

     7.4. Notice.  Notices and all other  communications  provided for under the
Plan  shall be in  writing  and shall be deemed  to have  been duly  given  when
delivered or mailed by United States registered mail, postage prepaid, addressed
to the other party as follows:

                           If to the Employer, to:

                           Possis Medical, Inc.
                           Attention: General Counsel
                           9055 Evergreen Blvd. N.W.
                           Minneapolis, MN    55433

     If to the Participant, to the address shown on the records of the Employer,
which the Employer shall keep up to date.

     Either  party may change its  address for  purposes of this  Section 7.4 by
giving appropriate notice to the other party.

<PAGE>

     7.5.  Governing Law. The validity,  interpretation  and construction of the
Plan  shall be  governed  by the laws of the State of  Minnesota,  except to the
extent that federal law controls.

     7.6. Validity.  The invalidity or  unenforceability of any provision of the
Plan shall not affect the validity or  enforceability  of any other provision of
the Plan, which shall remain in full force and effect.

     7.7.  Employment.  The Plan does not constitute a contract of employment or
impose on the Employer any obligation to retain any  Participant as an employee,
to  continue  any  Participant's  current  employment  status or to  change  any
employment policies of the Employer.

     7.8.  Termination  Prior to a Change in  Control.  Any  termination  of the
Participant's  employment  by the  Employer  without  Cause prior to a Change in
Control, and which occurs at the request or insistence of any person (other than
the  Employer) in  connection  with a Change in Control  shall be deemed to have
occurred after the Change in Control for purposes of the Plan.


SECTION 8

CLAIMS PROCEDURE

     8.1. General.  If a Participant  believes that he or she may be entitled to
benefits,  or the Participant is in disagreement with any determination that has
been made, the Participant may present a claim to the Employer.

     8.2.  Making a Claim.  A  Participant's  claim must be written  and must be
delivered  to the  Employer.  Within 30 days after  delivery of such claim,  the
Participant  shall receive either:  (a) a decision;  or (b) a notice  describing
special  circumstances  requiring a specified  amount of additional time (but no
more than 60 days from the date of delivery of such claim) to reach a decision.

     If such claim is wholly or partially denied,  the Participant shall receive
a written notice specifying: (a) the reasons for denial; (b) the Plan provisions
on which the denial is based; and (c) any additional information needed from the
Participant  in  connection  with the claim and the reason such  information  is
needed.  The  Participant  also  shall  receive  a copy  of  Section  8.3  below
concerning the Participant's right to request a review.

<PAGE>

     8.3 Requesting  Review of a Denied Claim. A Participant  may request that a
denied  claim be  reviewed.  Such request for review must be written and must be
delivered  to the  Employer  within 30 days after the  Participant  receives the
written notice that the participant's  claim was denied. Such request for review
may (but is not required to) include issues and comments the  Participant  wants
considered in the review.  The Participant may examine  pertinent Plan documents
by asking the Employer.  Within 30 days after delivery by the Participant of the
Participant's  request for review,  the Participant shall receive either:  (a) a
decision; or (b) a notice describing special circumstances requiring a specified
amount of additional time (but no more than 60 days from the date of delivery of
such request for review) to reach a decision.  The decision  shall be in writing
and shall specify the Plan provisions on which it is based.

     8.4. Exhaustion of Administrative  Remedies. No Participant (nor the estate
of any  deceased  Participant)  may  commence  any legal  action to recover Plan
benefits  or to enforce or clarify  rights  under the Plan under  Section 502 or
Section  510 of ERISA,  or under  any other  provision  of law,  whether  or not
statutory,  until the claims and review  procedures  set forth  herein have been
exhausted in their entirety.

     8.5.  Decisions.  All  decisions on claims and on reviews of denied  claims
will be made by the Employer.  The Employer may, in its discretion,  hold one or
more hearings. If a Participant does not receive a decision within the specified
time,  the  Participant  should assume that the claim was denied or re-denied on
the date the specified time expired. The Employer reserves the right to delegate
its authority to make decisions.


SECTION 9

DEFINITIONS

     When the following  terms are used in this  document  with initial  capital
letters, they shall have the following meanings.

     9.1.  Cause - shall mean (i) the material  breach by a  Participant  of any
obligation  to the  Company  under  the terms of this  Plan;  (ii) any acts of a
Participant  constituting  gross negligence or conduct which is demonstrably and
materially injurious to the Employer,  monetarily or otherwise;  (iii) Employees
breach of any fiduciary duty to the Employer; or (iv) a Participant's conviction
or the entry of a pleading of guilty or nolo  contendere to any crime  involving
moral turpitude. For purposes of this definition,  no act, or failure to act, on
a  Participant's  part shall be deemed  "willful"  unless done, or omitted to be
done, by the Participant with reasonable belief that the Participant's action or
omission was not in the best interest of the Employer.  Failure by a Participant
to perform  the  Participant's  duties  with the  Employer  during any period of
disability shall not constitute Cause.

     9.2. Change in Control - shall mean:

     (a) a change in control of a nature  that would be  required to be reported
in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), whether or not
the Employer is then subject to such reporting requirement; or

<PAGE>

     (b) the public announcement (which, for purposes of this definition,  shall
include,  without  limitation,  a report filed  pursuant to Section 13(d) of the
Exchange  Act) by the Employer or any "person" (as such term is used in Sections
13(d) and 14(d) of the Exchange Act) that such person has become the "beneficial
owner" (as defined in Rule 13d-3 promulgated  under the Exchange Act),  directly
or indirectly,  of securities of the Employer (i)  representing 25% or more, but
not  more  than  50%,  of the  combined  voting  power  of the  Employer's  then
outstanding  securities  unless the transaction  resulting in such ownership has
been approved in advance by the Continuing Directors (as hereinafter defined) or
(ii)  representing  more than 50% of the combined voting power of the Employer's
then  outstanding  securities  (regardless  of any  approval  by the  Continuing
Directors);  provided, however, that notwithstanding the foregoing, no Change in
Control  shall be deemed to have  occurred for purposes of the Plan by reason of
the  ownership of 25% or more of the total voting  capital stock of the Employer
then issued and  outstanding by the Employer,  any subsidiary of the Employer or
any employee  benefit plan of the Employer or of any  subsidiary of the Employer
or any  entity  holding  shares of the  common  stock  organized,  appointed  or
established  for, or pursuant to the terms of, any such plan (any such person or
entity  described in this clause is referred to herein as a "Employer  Entity");
or

     (c) the  announcement of a tender offer by any person or entity (other than
an Employer Entity) for 20% or more of the Employer's  voting capital stock then
issued and outstanding, which tender offer has not been approved by the Board, a
majority of the members of which are Continuing  Directors,  and  recommended to
the shareholders of the Employer; or

     (d)  the  Continuing  Directors  cease  to  constitute  a  majority  of the
Employer's Board of Directors; or

     (e) the  shareholders  of the  Employer  approve (i) any  consolidation  or
merger of the Employer in which the Employer is not the  continuing or surviving
corporation  or pursuant to which  shares of Employer  stock would be  converted
into cash, securities or other property,  other than a merger of the Employer in
which  shareholders  immediately prior to the merger have the same proportionate
ownership of stock of the surviving  corporation  immediately  after the merger;
(ii) any sale, lease, exchange or other transfer (in one transaction or a series
of  related  transactions)  of all or  substantially  all of the  assets  of the
Employer; or (iii) any plan of liquidation or dissolution of the Employer.

     9.3. Code - shall mean the Internal Revenue Code of 1986, as amended.

<PAGE>

     9.4.  Continuing  Director  - shall  mean any person who is a member of the
Board of Directors of the  Employer,  while such person is a member of the Board
of  Directors,  who is not an Acquiring  Person (as  hereinafter  defined) or an
Affiliate or Associate (as  hereinafter  defined) of an Acquiring  Person,  or a
representative of an Acquiring Person or of any such Affiliate or Associate, and
who (i) was a member of the Board of Directors as of the Effective  Date or (ii)
subsequently  becomes  a member  of the  Board of  Directors,  if such  person's
initial nomination for election or initial election to the Board of Directors is
recommended or approved by a majority of the  Continuing  Directors for purposes
of this definition.  "Acquiring Person" shall mean any "person" (as such term is
used in Sections  13(d) and 14(d) of the  Exchange  Act) who or which,  together
with all Affiliates and Associates of such person, is the "beneficial owner" (as
defined  in Rule  13(d)-3  promulgated  under the  Exchange  Act),  directly  or
indirectly,  of  securities  of the  Employer  representing  20% or  more of the
combined voting power of the Employer's then outstanding  securities,  but shall
not  include  the  Investors  or  any  Employer  Entity;   and  "Affiliate"  and
"Associate" shall have their respective  meanings ascribed to such terms in Rule
12(b)-2 promulgated under the Exchange Act.

     9.5. Date of  Termination - shall mean the date  specified in the Notice of
Termination (except in the case of a Participant's  death, in which case Date of
Termination  shall  be the  date  of  death);  provided,  however,  that  if the
Participant's  employment is terminated by the Employer,  the date  specified in
the Notice of Termination  shall be at least 30 days from the date the Notice of
Termination is given to the Participant and if the  Participant's  employment is
terminated by the Participant for Good Reason,  the date specified in the Notice
of  Termination  shall  not be more  than 60 days  from the date the  Notice  of
Termination is given to the Employer.

     9.6. Effective Date - shall mean September 15, 1999.

     9.7. Employer - shall mean Possis Medical,  Inc., a Minnesota  corporation,
or any successor thereto pursuant to Section 7.2 hereof or by operation of law.

     9.8.  Good  Reason - shall  mean the  occurrence,  without a  Participant's
express written  consent,  within 24 months following a Change in Control of any
one or more of the following:

     (a) a  significant  reduction  by the  Employer in the  Participant's  base
salary as in effect  immediately  prior to the  Change in Control or as the same
shall be increased from time to time;

     (b) the Employer's  requiring the  Participant to be based at a location in
excess of thirty  (30)  miles  from the  location  of the  Participant's  office
immediately prior to the Change in Control:

     (c) the  failure by the  Employer to (i)  continue  in effect any  material
compensation  or  benefit  plan,  program,  policy  or  practice  in  which  the
Participant  was  participating  at the time of the  Change in  Control  or (ii)
provide the Participant with  compensation and benefits at least equal (in terms
of benefit levels and/or reward  opportunities) to those provided for under each
employee  benefit plan,  program,  policy and practice as in effect  immediately
prior to the Change in Control (or as in effect following the Change in Control,
if greater);

     (d) the failure of the Employer to obtain a satisfactory agreement from any
Successor  to the  Employer  to assume and agree to perform  under the Plan,  as
contemplated in Section 7.2 hereof;

     (e)  any  purported  termination  by  the  Employer  of  the  Participant's
employment  that  is not  effected  pursuant  to a  Notice  of  Termination  (as
hereinafter defined); and

     (f)  the  assignment  by the  Employer  to the  Participant  of any  duties
inconsistent  in any respect  with  Participant's  position  (including  status,
offices,  titles,  and reporting  requirements),  authorities,  duties, or other
responsibilities  as in effect immediately prior to the Change in Control or any
other action of the Employer which results in a  diminishment  in such position,
authority,  duties,  or  responsibilities,   other  than  an  insubstantial  and
inadvertent  action which is remedied by the Employer  promptly after receipt of
notice thereof given by the Participant.

<PAGE>

     9.9.  Notice of  Termination - shall mean a written  notice which shall set
forth the Date of Termination and shall set forth in reasonable detail the facts
and   circumstances   claimed  to  provide  a  basis  for   termination  of  the
Participant's employment.

     9.10.  Participant - shall mean the employees of the Employer identified as
such by the Board,  as the same may be  modified  by the  Employer  from time to
time. Each Participant  shall be assigned to Class I, Class II, Class III, Class
IV or Class V provided in Section 4 herein.

     9.11.  Plan  -  shall  mean  the  termination  pay  plan  of  the  Employer
established  for the  benefit  of the  Participants  in the event of a Change in
Control.  The Plan shall be referred to as the "Possis  Medical,  Inc. Change in
Control Termination Pay Plan."

     9.12.  Plan  Year - the  twelve  consecutive  month  period  ending  on any
December 31.

     9.13. Termination of Employment - shall mean termination of a Participant's
employment  (a) by the  Employer  for any  reason  other  than Cause or (b) by a
Participant  for Good Reason;  but shall not include  termination by reason of a
Participant's death.

<PAGE>



                  Approved by action of the Executive Committee
                 of the Possis Medical, Inc. Board of Directors
                 by Action in Writing effective October 28, 1999

                                      /s/
                          Irving R. Colacci, Secretary


                                Amended Effective
                                December 6, 1999

                                       /s/
                          Irving R. Colacci, Secretary


                                Amended Effective
                                  April 3, 2001

                                       /s/
                          Irving R. Colacci, Secretary


                                Amended Effective
                                December 12, 2001

                                       /s/
                          Irving R. Colacci, Secretary


<PAGE>