EXHIBIT 10.1


 


November 2, 2005


 


 


Mr. Marc P. Flores


President and Chief Executive
Officer


c/o MedicalCV, Inc.


9725 South Robert Trail


Inver Grove Heights, MN 55077


 


Dear Mr. Flores:


 


Reference is
made to your offer letter dated August 27, 2004 (the “Offer Letter”),
pursuant to which MedicalCV, Inc. (the “Company”) employed you as its
President and Chief Executive Officer. The Offer Letter described the Company’s
obligation to reimburse you for certain expenses in connection with the sale of
your Nevada home, relocation expenses and expenses in connection with the
establishment of a Minnesota residence (“Relocation Expenses”). The Board of
Directors of the Company has approved the following revised arrangements.


 


Since the
commencement of your employment, you have continued to maintain your Nevada
home while commuting to the Twin Cities area. The Company and you determined
that this strategy was reasonable and acceptable in view of the fact that
initially, the Company’s financial condition was uncertain, you and other
members of senior management spent much of your time traveling to the East and
West coasts in connection with meetings with financing sources and for meetings
in various states at medical centers with physicians. During this time, your
family, including school-age children, was rooted in the Lake Tahoe, Nevada
community. Now that the Company has received its funding for operations in 2005
and most of 2006, you have determined to move your family to Minnesota. You
will be living in a temporary rented residence. Your move to Minnesota should
be completed by November 5, 2005. During the period of your residence in
Nevada, the Company has paid all of your travel expenses, including reimbursing
you for travel to Minnesota. The Company has also reimbursed you for lodging
expenses. The Company’s outlay for reimbursement of your travel and lodging
expenses will substantially reduce when you complete your move of residence to
Minnesota. The Company believes that a move of residence to Minnesota will
reduce your burden of travel and will ease the burden on your family due to
your commuting schedule.


 


You have not
sold your Nevada residence to date and have advised the Company that this is an
inopportune time to put your home on the market. You have advised the Company
that when you determine to sell your Nevada residence, the prime time for
offering it for sale would be during the spring and summer months. In the
meantime, to assist you with the additional financial burden of maintaining the
temporary Twin Cities residence, the Company agrees to pay you for a period of
one year commencing November 1, 2005, a supplemental payment, in addition
to your agreed-upon salary and bonus compensation, in the amount of $2,500 per
month. Such monthly payment will end on November 1, 2006, or earlier if
you sell your Nevada residence. The Company will also reimburse you for the
cost of transporting your family, pets, personal vehicles and household goods
to the temporary Minnesota residence.


 


In addition,
the Company agrees to pay or reimburse to you the following Relocation Expenses
if you sell your home in Nevada and move to Minnesota:


 





















 


1.                                       Packing,
transport and delivery of your household goods by a national freight carrier.


 


2.                                       Reasonable
and customary real estate closing costs for the sale of your home, excluding
seller paid points, prorated taxes, prorated interest and seller’s allowances.


 


3.                                       Customary
closing costs for the purchase of your Minnesota residence, with a maximum of 1
percent for a loan origination fee and excluding discount points, prepaids and
homeowner association fees.


 


All expenses are subject
to Company review for reasonableness and will be reimbursed only to the extent
they are incurred on or before November 1, 2006.


 


To the extent
the above benefits result in additional taxable wages to you, the Company will
make a separate payment to you for each tax year in which you receive either
the supplemental payment or Relocation Expenses to cover such additional state
or federal income taxes.


 


The understanding
reached in this Letter-Agreement will supersede all prior understandings and
agreements concerning the subject matter hereof, including your Employment
Agreement, dated August 8, 2005. The provisions for payments to you in
this Letter-Agreement will terminate upon the termination of your employment,
except to the extent you have incurred or submitted a reimbursement expense
prior to such termination.


 


If this letter
correctly sets forth the understanding we have reached, please indicate your
acceptance by signing and returning one copy of this letter.


 


	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Susan L.
  Critzer

  	
   

  
	
   

  	
  Susan L.
  Critzer

  
	
   

  	
  Chairperson

  



 


Agreed
and accepted, effective November 3, 2005


 


 


	
  /s/
  Marc P. Flores

  	
   

  
	
  Marc
  P. Flores