Exhibit
10.16


EMPLOYMENT AND ARBITRATION AGREEMENT


This Employment
Agreement is entered into as of , 2006 (the “Effective Date”), by and between
World Heart Inc, (“COMPANY”), and Petrus Jansen (“Employee”).


WHEREAS,
COMPANY desires to employ Employee as of the Effective Date and Employee
desires to accept employment with COMPANY on the terms and conditions set forth
below.


NOW,
THEREFORE, in consideration of the foregoing recital and the
respective covenants and agreements of the parties contained in this document,
COMPANY and Employee agree as follows:


Employment and Duties.  During the Employment Period (as defined in
paragraph 2 below), Employee will be performing all applicable duties customary
to his position on behalf of COMPANY. 
The duties of Employee shall include, but not be limited to, the position of
Chief Medical Officer (CMO):


·                  Responsible for
acting as the medical liaison between World Heart Corporation and the medical
community.  This pertains to heart
failure cardiologists and cardiac surgeons active in the field of Ventricular
Assist Devices (VAD).


·                  Most senior
executive responsible for the overall clinical trials/research and data
collection functions.  Interacts with
various inside/outside groups to oversee clinical trials research.


·                  Participate in FDA
interactions in support of WorldHeart’s Investigational Device Exemption (IDE)
studies and active development projects.


·                  Partner with Key
Opinion Leaders to enhance therapy adoption of VADs as an alternative for end
stage heart failure patients.  Attend
major medical conventions in order to obtain information pertinent to
WorldHeart’s business.


·                  Responsible for
clinical training programs ensuring that WorldHeart products are used according
to product labeling and instructions for use. 
Foster best demonstrated practices with VADs to improve clinical
outcomes.


·                  Reports to the President and CEO and is a
member of the Executive Management Team. Assists in the formulation of current
and long-range strategies, plans and objectives of the Corporation.


·                  Direct management of the following
departments/groups:  Clinical Affairs (1
Director), Clinical and Technical Support (1 Director) and World Heart BV
(European Operations — 2 Directors). 
Manage, develop and execute departmental budgets appropriate to build
company value.


1.     Term of
Employment.  COMPANY agrees to
employ Employee, and Employee agrees to work for an initial term of eighteen
months from the Effective Date. Company may terminate Employee prior to the
expiration of the term for just cause which is defined as follows: (1)
Employee’s willful refusal to comply with a lawful instruction or direction
from the President or CEO or the Board of Directors, or (2) Employee’s
conviction of any offense involving an act of moral turpitude, or (3) Employee’s
commission of race, sex,
national origin, religion, disability, age-based or other illegal
discrimination, or an act of sexual harassment, provided that such
determination is made in good faith  by
the Company, or (4) conduct that would, absent any contrary express
agreement, entitle the Company to terminate the Employee’s employment with the
Company without any notice or compensation in lieu of notice. At the end of the
initial eighteen month term described herein, Employee’s continued



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employment with COMPANY
shall have no express term and shall be “at will”, and either he or the COMPANY
may terminate his employment with or without notice or reason.


2.     Place of
Employment.  Employee’s
services shall be performed at the COMPANY’S U.S. office and away therefrom as
required. Employee specifically acknowledges that Employee may be required to
travel in connection with the performance of his/her duties hereunder.  Relocation to California will take place
within 3 calendar months after the effective date.


3.     Wages and Other Compensation.


(a)   WAGES: For all
services to be rendered by Employee pursuant to this Agreement, COMPANY agrees
to pay Employee, during the Employment Period an annual salary of $205,000.00
Dollars (the “Salary”) payable bi-weekly. The Salary shall commence upon the
first day of the calendar month after Employee has relocated to California.


(b)   RELOCATION EXPENSES:  In
addition to Employee’s wages, the Company shall pay Employee Relocation
Expenses not to exceed $50,000, including: (a) compensation for the sale of
Employee’s personal residence in an amount of 5% of the sales price of his
current residence or 7% of the purchase price for a new residence in
California, whichever amount is less. As used herein, the purchase price or
sale price shall be the gross sale or purchase amount prior to any reduction
for commissions, repairs or other deductions related to the transaction; (b)
Incidentals expenses; (c) reimbursement for temporary housing if needed; (d)
reimbursement for moving expenses actually incurred in the movement of Employee’s
personal possessions.  Employee agrees to
reimburse Company for any Relocation Expenses received if Employee elects to
terminate his employment prior to the end of the eighteen month term.  Employee acknowledges that he is responsible
for all taxes, if any, related to the foregoing Relocation Expense
compensation.


(c)   CHANGE OF CONTROL:  It is
agreed by the COMPANY that if Employee is terminated after a change of control
of the COMPANY, but prior to the expiration of the eighteen month term,
Employee shall be paid for the remainder of the term as a severance payment in
connection with the termination.”Change of Control” shall mean 50% or more of
the Voting Shares of the Company become owned beneficially by a person or group
of persons acting jointly or in concert.


(d)  SERVICE CREDIT:    Employee’s service credits shall accrue
from his original date of hire by WorldHeart Corporation in the Netherlands
which began on February 1, 2004.


4.     Proprietary Rights Agreement.  Employee shall remain bound by his previously
executed Proprietary Rights Agreement executed on December 9, 2003.


5.     Representations and
Warranties.  Employee
represents and warrants that his execution of this Agreement, his employment
with COMPANY, and the performance of his proposed duties under this Agreement
shall not violate any obligations he may have to any former employer (or other
person or entity), including any obligations with respect to proprietary or
confidential information of any other person or entity.  Employee agrees that he will not use for the
benefit of, or disclose to,



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Employer any confidential information belonging to any
former employer or other entity unless he has written permission from the
employer or entity to do so (or if Employer has been granted such permission).


6.     Benefits.


A.                                   Paid Holidays. 
COMPANY will pay Employee for the following holidays: New Year’s Day,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day, Day after
Thanksgiving, Christmas Day and Four Company paid floating days, to be
scheduled annually at the discretion of the Company.


B.                                     Paid Time Off. Employee shall earn paid time off in the form
of vacation and sick leave.  Employee
shall accrue 20 days per year to be used in accordance with the COMPANY’S
written Vacation Policy.  Employee shall
be allotted sick leave as provided in the COMPANY’S written Sick Leave Policy.


C.                                     Health Insurance—as
per plan documents.


D.                                    401K—as per plan
documents.


E.                                      Stock Options. Employee may elect to participate in COMPANY’s
Stock Option Plan as eligible, and as consistent with the terms and conditions
of the Plan.


7.     Arbitration.  Any dispute or
controversy arising under or in connection with this Agreement shall be settled
exclusively by binding arbitration in Alameda County, California, in accordance
with the rules of the American Arbitration Association then in effect by an
arbitrator selected by both parties within 10 days after either party has
notified the other in writing that it desires a dispute between them to be
settled by arbitration.  In the event the
parties cannot agree on such arbitrator within such 10-day period, each party
shall select an arbitrator and inform the other party in writing of such
arbitrator’s name and address within 5 days after the end of such 10-day period
and the two arbitrators so selected shall select a third arbitrator within 15
days thereafter; provided, however, that in the event of a failure by either
party to select an arbitrator and notify the other party of such selection
within the time period provided above, the arbitrator selected by the other
party shall be the sole arbitrator of the dispute.  Each party shall pay its own expenses
associated with such arbitration, including the expense of any arbitrator
selected by such party and COMPANY will pay the expenses of the jointly
selected arbitrator.  The decision of the
arbitrator or a majority of the panel of arbitrators shall be binding upon the
parties and judgment in accordance with that decision may be entered in any
court having jurisdiction there over. 
Punitive damages shall not be awarded.


8.     Assignment.  This Agreement and
all rights under this Agreement shall be binding upon and inure to the benefit
of and be enforceable by the parties hereto and their respective personal or
legal representatives, executors, administrators, heirs, distributees,
devisees, legatees, successors and assigns. 
This Agreement is personal in nature, and neither of the parties to this
Agreement shall, without the



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written consent of the other, assign or transfer this
Agreement or any right or obligation under this Agreement to any other person
or entity; except that COMPANY may assign this Agreement to any of its
affiliates or wholly-owned subsidiaries, provided, that such assignment will
not relieve COMPANY of its obligations hereunder.  If Employee should die while any amounts are
still payable to Employee hereunder, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the terms
of this Agreement to Employee’s devisee, legatee, or other designee or, if
there be no such designee, to Employee’s estate.


9.     Notices.  For purposes
of this Agreement, notices and other communications provided for in this
Agreement shall be in writing and shall be delivered personally or sent by
United States certified mail, return receipt requested, postage prepaid,
addressed as follows:




	
  If to Employee:

  	
   

  	
  Arent
  Janszoon Ernststraat 893

  
	
   

  	
   

  	
  1081 HL
  Amsterdam

  
	
   

  	
   

  	
  The
  Netherlands

  
	
   

  	
   

  	
   

  
	
  If to COMPANY:

  	
   

  	
  World Heart Inc.

  
	
   

  	
   

  	
  7799 Pardee Lane

  
	
   

  	
   

  	
  Oakland, California

  
	
   

  	
   

  	
  94621

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Monica Lippis, Director of Human
  Resources

  
	
   

  	
   

  	
  Facsimile number: 510 563-5003

  






 


or to such other address or the attention of such other
person as the recipient party has previously furnished to the other party in
writing in accordance with this paragraph. 
Such notices or other communications shall be effective upon delivery
or, if earlier, three days after they have been mailed and deposited as
provided above.


10.   Integration.  This
Agreement represents the entire agreement and understanding between the parties
as to the subject matter hereof and supersedes all prior or contemporaneous
agreements whether written or oral, including, but not limited to the Netherlands
Employment Contract.  No waiver,
alteration, or modification of any of the provisions of this Agreement shall be
binding unless in writing and signed by duly authorized representatives of the
parties hereto.


11.   Waiver.  Failure or
delay on the part of either party hereto to enforce any right, power, or
privilege hereunder shall not be deemed to constitute a waiver thereof.  Additionally, a waiver by either party or a
breach of any promise hereof by the other party shall not operate as or be
construed to constitute a waiver of any subsequent waiver by such other party.


12.   Severability. 
Whenever possible, each provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or any



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other
jurisdiction, but this Agreement will be reformed, construed and enforced in
such jurisdiction as if such invalid, illegal or unenforceable provision had
never been contained herein.


13.   Headings.  The headings of the paragraphs contained in
this Agreement are for reference purposes only and shall not in any way affect
the meaning or interpretation of any provision of this Agreement.


14.   Applicable Law.  This Agreement shall be governed by and
construed in accordance with the internal substantive laws, and not the choice
of law rules, of the State of California.


IN WITNESS WHEREOF, each of the parties has
executed this Agreement, as of the day and year first above written.


	
  Employee

  	
   

  	
  WORLD
  HEART, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Petrus GM Jansen

  	
   

  	
  /s/ Jal
  S. Jassawalla

  
	
   

  	
   

  	
   

  
	
  Petrus GM Jansen

  	
   

  	
  Jal S. Jassawalla, President & C.E.O.

  



 


 



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