Exhibit 10.17


 


August 5,
2008


 


Vikram
Simha


49
Trefry Lane


Stow,
MA 01775


 


Dear
Vikram,


 


On
behalf of Vital Images, Inc., I am pleased to offer you the full-time
position of Chief Technology Officer and Executive Vice President of
Engineering reporting directly to me. 
Your base salary will be $10,000.00 semi-monthly, which annualizes to
$240,000.  Your start date will be August 6th, 2008.  This offer letter will
expire on August 6th, 2008.


 


In
addition to your base salary, you will be eligible for the management bonus
program.  Your management bonus incentive
target for calendar year 2008 will be 35% of base pay.  Awards under the management bonus incentive
plan will be based on achievement of a combination of both company and personal
performance goals. Moreover, there is an opportunity for the bonus payout to be
more than your incentive target, based on overachievement of Company goals.
Payouts under the management incentive bonus plan are expected to be made to
qualifying employees on a lump sum basis on or before March 15, 2009.  Please be advised that Vital Images reserves
the right, without prior notice, to make any changes to the manager bonus
program at its discretion, of which you will be notified.


 


Additionally,
the Company will pay you a signing bonus of $35,000.  Appropriate taxes will be withheld on this
bonus.  Should you leave the Company
voluntarily within one year after your start date; the sign-on bonus must be
repaid to the Company.


 


In addition to your salary, management will
recommend that you receive non-qualified options to purchase 150,000 shares of
Vital Images Common Stock and 15,000 shares of restricted stock. The grants will be priced as of your start date
with Vital Images (or the first preceding trading date, if the markets are closed
on your start date) and will be under our standard terms and conditions for
such grants.


 

















 


We have agreed that you
will relocate to the Minneapolis, MN area no later than May 2010.  To assist you in your relocation we will pay
for temporary housing in the Minneapolis area for the next 18 months.  We
will also pay for the move of your household goods and two house hunting trips
for you and your spouse for four days duration each and reimburse you for any
travel expenses associated with traveling to and from our headquarters prior to
your relocation.  Please see “Exhibit A”
for more details surrounding the relocation assistance.


 


*  *  *


 


You represent and warrant
that as of the date that you sign this letter agreement, you have not,
personally or through your agent, * * * .  If you voluntarily terminate
your employment with the Company or are terminated for Cause, as such is
defined in your employment agreement, within six (6) months of your start
date, you also agree to reimburse the Company for any amounts paid under this
provision, and if you voluntarily terminate your employment with the Company or
are terminated for Cause within the following twelve (12) months, you agree to
reimburse the Company a prorated portion of these amounts, amortized on a straight-line
basis commencing with your seventh (7th) month of employment.  You
represent and warrant that you have provided the Company with * * *.  You
further represent, warrant and covenant that you have not misappropriated any
confidential, proprietary or trade secret information of your former employer,
will not do so, and that you will not disclose to the Company any of such
information.  The Company’s obligation under this clause will not apply to
any claim or lawsuit brought by the Company against you.  In exchange, you
agree to repay the Company the signing bonus and any amounts paid under this
provision if you produce work product for the Company that you know or should
have known infringes on the intellectual property rights of any third party, including
any of your former employers.  To the
extent allowable under any relevant litigation, and subject and in addition to
the other terms and conditions of your employment, including its at-will nature
and the Company’s severance obligations, the Company agrees to * * * whether
directly or indirectly, as an employee, contractor, advisor, director or
proprietor, during that period, other than employment for non-profit
organizations, as such term is defined under the Internal Revenue Code, in
areas wholly unrelated to the Company’s business, provided that, if you do not
commence working with the Company within thirty (30) days * * * you are
terminated for Cause or resign voluntarily, you shall reimburse to the Company
all salary paid to you * * *. Notwithstanding the above, * * *


 


* * *
Confidential Treatment has been requested, the portion indicated has been
redacted and the redacted portion has been separately filed with the Securities
and Exchange Commission.


 

















 


Upon
joining Vital Images, you will be eligible to participate in the Company’s
fringe benefit program. Specifically, you will accrue 1.66 days per month (.833
days per pay period) which equals 20 days (4 weeks) of vacation per year. You
will also receive ten (10) paid holidays per calendar year.  Medical, Dental, and Disability Insurance will
be effective the first of the month following the start date.  You may
participate in the Vital Images Employee Stock Purchase Plan the first day of
any quarter, and the Vital Images 401(k) plan the first day of the month,
following a three-month waiting period.  Please be advised that Company
fringe benefit programs are subject to change as a matter of Company policy.


 


In
compliance with the Immigration Reform and Control Act, all new employees are
required to provide proof of work eligibility and identification. In order to
satisfy these requirements, certain documents must be presented within 72 hours
of your start date.  Please review the
list, which is attached to the Form I-9, of appropriate documentation and
bring these with you on your first day of employment.


 


You
should be aware that your employment with Vital Images is for no specified
period and constitutes at will employment. 
As a result, you are free to resign at any time, for any reason or for
no reason.  Similarly, Vital Images is
free to conclude our employment relationship with you at any time, with or
without cause, and with or without notice, subject to any severance obligations
under any written employment agreement with the Company.


 


This
offer of employment is contingent upon successful completion of a background
investigation by the Human Resources Department at Vital Images.  Confirmation of completion of the
investigation will be provided to you as soon as the investigation is complete.


 


To
accept this offer of employment, please sign below and return one copy of this
letter as soon as possible in the enclosed envelope, along with your signed
non-disclosure agreement.


 

















 


Vikram, we are excited about
having you on the Vital Images’ team.  We
are confident that you will contribute to our Company’s growth and that we can
provide a challenging and rewarding work environment to further your
professional career.


 


	
  Sincerely,

  	
   

  
	
   

  	
   

  
	
  /s/ Michael H. Carrel

  	
   

  
	
   

  	
   

  
	
  Michael Carrel

  	
   

  
	
  President/Chief
  Executive Officer

  	
   

  



 


 


	
  Accepted
  by 

  	
  /s/Vikram
  Simha

  	
   

  	
  Date 

  	
  8/6/2008

  



 

















 


Exhibit A


 


VITAL IMAGES, INC.


RELOCATION AGREEMENT


 


THIS RELOCATION AGREEMENT (the “Agreement”) is
entered into on the 6th day of August, 2008 by and between Vital
Images, Inc. (the “Company”) and Vikram Simha (the “Employee”).


 


IT IS AGREED AS FOLLOWS:


 


I.)  Payment of Relocation Costs.  The Company will pay to Employee, or to
designated third parties on behalf of Employee, the following Covered
Relocation Costs:


 


Physical Move


 


The Company will pay reasonable costs (pre-approval based upon 3
estimates required) incurred in moving household effects from the old principal
residence in Stow, MA to the new principal residence in Minnesota. This
includes the costs of packing, unpacking, disconnecting and reconnecting
appliances, and standard value insurance. 
The Company will not assume the costs for the purchase of new items if
the old items cannot be reinstalled. The Company will not be responsible for
the expense of transporting personal effects which are heavy, bulky, or require
handling and transportation costs which are disproportionate to the value of
the items. Examples include, but are not limited to, the following: heavy hobby
equipment, firewood, garden sheds and similar portable buildings and equipment,
boats which cannot be accommodated in the van with household furnishings, and
household pets which do not accompany the family. This exclusion also applies
to furnishings and effects that are located elsewhere than Employee’s principal
residence, as for example, in a second home, or in a storage warehouse.
Arrangements and charges for these items, if transported, will be the employee’s
responsibility and expense.


 


Vital Images, Inc. will not be responsible for the loss or damage
to your property. Carriers normally disclaim responsibility for currency,
valuable papers, watches, jewelry, collectables and precious metals. Property
of this nature, as well as that of high sentimental value, should not be
shipped or placed in storage, but transported personally.


 


II.) 
Temporary Housing


 


During the
interval between arrival of Employee’s family and the time when the new
residence can be occupied (i.e., household effects have been delivered and set
in place, necessary appliances connected, and utilities turned on) Vital Images
will pay reasonable costs for reasonable living expenses (lodging), for a
period not to exceed eighteen (18) months.


 


III.) 
House Hunting Trip


 


All actual, reasonable expenses incurred for one (2) house hunting
trips between the old and new location will be reimbursed. This will include
transportation, food, and lodging  for
the employee and spouse.  Reimbursement
will be limited to a maximum of a four (4) day trip, exclusive of travel
time.


 

















 


IV.)         Taxes.


 


Employee is advised to consult with his/her tax advisor or accountant
or the Internal Revenue Service with regard to deductibility and
nondeductibility of items reimbursed and paid for by the Company under this
policy. The Company agrees to gross up the Employee an additional amount of his
wages such that his total out of pocket costs arising out of any tax liability
associated with the benefits provided hereunder together with such additional
amount of his wages is zero.


 


V.)           Repayment of Relocation
Costs.


 


Upon Employee’s
voluntary resignation with the Company (the “End Date”), Employee will
immediately repay to the Company all Covered Relocation Costs advanced by the
Company, reduced by an amount equal to 8.33% of such Costs for each full month
that Employee has been employed by the Company since relocating to
Minneapolis/St. Paul (the “Repayment Amount”).


 


VI.)         Consent to Offset.


 


The Repayment
Amount may be deducted from any and all amounts due permitted by law any
payments that would otherwise be due to me, from the Company, including,
without limitation, wages, accrued vacation pay and commissions, and Employee
expressly authorizes the Company to effect such deductions up to the total
relocation expenses.


 


 


	
  VITAL IMAGES, INC.

  	
   

  	
  EMPLOYEE

  
	
   

  	
   

  	
   

  
	
  Sign 

  	
  /s/ Michael H. Carrel

  	
   

  	
  Sign 

  	
  /s/ Vikram Simha

  
	
   

  	
   

  	
   

  
	
  Print 

  	
  Michael Carrel

  	
   

  	
  Print 

  	
  Vikram Simha

  
	
   

  	
   

  	
   

  
	
  Date: 

  	
  8/6/08

  	
   

  	
  Date: 

  	
  8/6/2008