Document:

EX-10.(a)

OFFICER STOCK PURCHASE POLICY

From time to time the Company is in the stock market repurchasing shares to fund special
stock issuance needs such as employee stock plans or business acquisitions. Purchases are made
pursuant to a Board approved stock repurchase “program” adopted from time to time by the Board.
When the Company is in a position to be in the market for stock, as directed by the Chief Financial
Officer, the Company will be willing to purchase shares from any officer of the Company so long as:

	 	•	 	The Company is otherwise ready to be in the market for the
purpose of repurchasing shares of Toro Common Stock under a
Board approved and announced stock repurchase program;

	 	•	 	The block of shares being offered for sale by the officer
must be registered in the officers name or in an account
held by a broker on behalf of an officer [not in conjunction
with the exercise of a stock option] and in an amount of
5,000 or more shares;

	 	•	 	The price per share the Company will pay is the reported New
York Stock Exchange Closing Price on the day of the
transaction and the Company will not assess a sales
commission. If officer tells the Company he/she wishes to
sell before the market opens on any given day, he/she will
receive the Closing Price from the day before, and if after
the market opens (anytime up until 4:00 p.m. c.s.t.) the
officer will receive the Closing Price at the end of the
day;

	 	•	 	The Company will not make purchases at times when, in the
opinion of the General Counsel or pursuant to New York Stock
Exchange guidelines, officers are prohibited from market
transactions;

	 	•	 	Transactions will be administered by the General Counsel’s
office and will be subject to normal Securities & Exchange
Commission reporting.EX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

This Employment Agreement (this “Agreement”) is made as of September 8, 2004 by and between
Diametrics Medical, Inc., a Minnesota corporation having an office at 3050 Centre Pointe Drive,
Suite 150, Roseville, Minnesota 55113 (the “Company”) and Mr. William P. Moffitt, an individual
residing at 942 Pine Tree Lane, Winnetka, IL 60093 (“Executive”).

Preamble

The Company is undergoing an evaluation of its strategic direction and, in connection
therewith, desires to employ the services of Executive as its Chairman of the Board. Either during
such evaluation, or as part of the implementation of a new strategic plan, the Company may
undertake a recapitalization (including the possible infusion of new capital), the terms and
conditions of which are not at this time ascertainable (the “Possible Recapitalization”).
Executive’s compensation under this Agreement is predicated on certain mutual assumptions and
expectations with respect to the Possible Recapitalization. Accordingly, if the actual terms and
conditions of the Possible Recapitalization differ materially from such assumptions and
expectations, the Company and Executive agree in good faith to negotiate such changes in
Executive’s compensation as may then be in their mutual best interests and consistent with the
spirit and intent of this Agreement.

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements of the parties
contained herein, the Company and Executive hereby agree as follows:

1. Definitions. Unless otherwise defined herein, the following terms shall have the
following respective meanings:

(a) “Cause” means any (i) conviction of Executive of, or plea of guilty by Executive to, a
felony, (ii) any breach or non-observance by Executive of any material covenant set forth in this
Agreement, or the failure by Executive to comply with the lawful instructions or direction or
policies of the Company’s Board of Directors, provided that the Board of Directors of the
Company has given Executive written notice of such breach or non-observance or non-compliance and
Executive has failed to cure such breach or non-observance or non-compliance within a period
reasonable under the circumstances or (iii) any willful or deliberate misconduct by Executive that
is materially injurious to the Company.

(b) “Change in Control” means the occurrence of any of the following events in a single
transaction or related series of transactions:

(i) the purchase or other acquisition by any person, entity or group of persons, within the
meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), or any comparable successor provisions (other than stockholders (or affiliates thereof) of
the Company as of the date hereof or who become stockholders of the Company pursuant to the
Possible Recapitalization), of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of fifty percent (50%) or more of either (A) the outstanding shares of
Common Stock (on a fully-diluted basis with respect to outstanding Company securities or debt
convertible into Common Stock) or (B) the combined voting power of the Company’s then-outstanding
voting securities entitled to vote generally in the election of directors of the Company;

(ii) the consummation of a reorganization, merger or consolidation of the Company, in each
case, with respect to which persons who were stockholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately thereafter, own more than fifty percent
(50%) of the combined voting power entitled to vote generally in the election of directors of the
reorganized, merged or consolidated company;

(iii) a liquidation or dissolution of the Company; or

(iv) the sale of all or substantially all of the Company’s assets.

(c) “Common Stock” means the Common Stock, par value $0.01 per share, of the Company.

(d) “Competitive Business” means the business of selling products whose principal function is
the continuous monitoring, through blood and/or tissue analyses in human critical care settings, of
basic parameters of metabolic function including but not limited to glucose, blood gases and other
physiologic parameters.

(e) “Effective Date” means September 8, 2004.

(f) “Permanent Disability” means Executive’s inability to substantially perform his duties and
responsibilities hereunder by reason of any physical or mental incapacity for a period of 180
consecutive days, or two or more periods of 90 consecutive days each in any 360-day period.

(g) “Restricted Period” means one (1) calendar year from the date of termination of
Executive’s employment by the Company under this Agreement.

(h) “Tier I Change in Control” means a Change in Control resulting in total aggregate proceeds
to the Company or the Company’s stockholders of less than twenty-five million dollars
($25,000,000).

(i) “Tier II Change in Control” means a Change in Control resulting in total aggregate
proceeds to the Company or the Company’s stockholders of twenty-five million dollars ($25,000,000)
or more, up to and including one hundred million dollars ($100,000,000).

(j) “Tier III Change in Control” means a Change in Control resulting in total aggregate
proceeds to the Company or the Company’s stockholders of more than one hundred million dollars
($100,000,000).

2. Employment

(a) Position and Duties. Executive is hereby employed by the Company to serve as the
Chairman of the Board of Directors of the Company, as of the Effective Date, with such authority,
duties and responsibilities as are customarily associated with such office. Executive agrees that,
to the best of his ability and experience, he will conscientiously perform all such customary
duties and responsibilities. The foregoing notwithstanding, the Company acknowledges that
Executive is serving as president and chief executive officer of another entity not in competition
with the Company, and agrees that Executive may continue in such position during the Term of
Employment (as defined below).

(b) No Conflicting Agreements. Executive represents and warrants that neither
Executive’s entry into this Agreement nor Executive’s performance of Executive’s obligations
hereunder will conflict with or result in a breach of the terms, conditions or provisions of any
other agreement, understanding or obligation of any nature to which Executive is a party or by
which Executive is bound.

(c) Term. Executive shall be an employee of the Company under this Agreement
beginning on the Effective Date and continuing until such employment is terminated in accordance
with Section 5 hereof (the “Term of Employment”).

(d) Board of Directors. As of the Effective Date, Executive shall be appointed or
elected to the Board of Directors of the Company and appointed or elected Chairman of the Board of
Directors of the Company.

3. Compensation

(a) Salary. The Company will pay the Executive an amount in cash equal to not less
than one hundred dollars ($100) for each day during which Executive provides service to the Company
under this Agreement, such amount to be paid in accordance with the Company’s customary payroll
practices.

(b) Initial Option Grant. As of the Effective Date, Executive shall be awarded an
incentive stock option under the Company’s 1990 Stock Option Plan to purchase up to 25,000 shares
of Common Stock at a per share exercise price equal to the fair market value of a share of Common
Stock on the Effective Date (the “Initial Option”).

(c) Subsequent Option Grant. As of the occurrence of the Possible Recapitalization,
Executive shall be awarded an incentive stock option under the Company’s 1990 Stock Option Plan to
purchase up to that number of shares of Common Stock which, after giving effect to the Possible
Recapitalization and together with the shares of Common Stock underlying the Initial Option, equals
10% or more of the then outstanding Common Stock, after giving effect to all outstanding rights to
purchase Common Stock, at a per share exercise price equal to the fair market value of a share of
Common Stock on the date of grant (the “Subsequent Option,” and together with the Initial Option,
the “Options”).

(d) Option Agreements. Each Option shall be evidenced by an agreement containing the
terms provided for herein, and such other terms and conditions as may be customary for grants of
stock options under the Company’s 1990 Stock Option Plan. Each Option shall vest in accordance
with Sections 4 and 5 below.

(e) Other Benefits. The Company and Executive shall in good faith negotiate a
benefits package for Executive which shall be commensurate with his position, be consistent the
Company’s policies for its senior executives generally and take into consideration Executive’s
benefits from other applicable employment.

(f) Reimbursement of Expenses. During the Term of Employment, the Company shall pay
or promptly reimburse Executive, upon submission of proper invoices in accordance with the
Company’s customary practice and policy, for all reasonable out-of-pocket business, entertainment
and travel expenses incurred by Executive in the performance of his duties and responsibilities
under this Agreement.

4. Change in Control. If a Change in Control occurs, Executive shall be entitled to
certain bonus payments and the Options shall vest in accordance with the terms described below:

(a) Upon a Tier I Change in Control, the Options shall not vest or become exercisable and
shall terminate. However, the Company shall immediately pay to Executive, in cash, an amount
equal to one million dollars ($1,000,000).

(b) Upon a Tier II Change in Control, the Options shall vest in full and immediately become
exercisable.

(c) Upon a Tier III Change in Control, the Options shall vest and immediately become
exercisable to the extent the Options would have, if exercised prior to such Change in Control,
resulted in Executive’s acquisition of seven and one-half percent (7.5%) of the total outstanding
Common Stock at such time, after giving effect to all then outstanding rights to purchase Common
Stock (determined immediately prior to the Change in Control). If, as a result of such vesting,
the number of shares of Common Stock then issuable under the Options have a lower aggregate fair
market value than the aggregate fair market value of the maximum number of shares of Common Stock
issuable under the Options that vest upon a Tier II Change in Control (the “FMV Shortfall”), then
the Company shall immediately pay to Executive, in cash, an amount equal to the FMV Shortfall.

(d) Taxes. The Company shall reimburse Executive for (i) any excise tax imposed by
Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”) on any portion of the
compensation or benefits payable by the Company or its affiliates to Executive under this
Agreement, all other contracts, arrangements or programs, and (ii) any such excise tax and any
other taxes imposed by the Code or under state or local law on the payments provided for in this
Section 4(d). Executive and the Company agree to reasonably cooperate to mitigate the amount of
any such tax that might become payable. The Company shall pay to Executive the payments, or
portions thereof, provided for in this Section 4(d) not later than fifteen (15) days prior to the
date on which such taxes, or portions thereof, are due as determined by the tax counsel referred to
below. Tax counsel selected by the Company and reasonably acceptable to Executive shall determine
the amounts (if any) due Executive under this Section 4(d), based on the actual tax rates to which
Executive is subject at the time. Executive shall provide such counsel with such information as
such counsel reasonably requests in connection with such determination. All determinations of tax
counsel shall be binding on Executive and the Company. Tax counsel shall determine that payments
shall be due hereunder only if, and to the extent that, it is more likely than not that the
payments or benefits are subject to a tax. In making the determinations required by this Section
4(d), tax counsel may rely on benefit consultants, accountants or other experts. The Company
agrees to pay all reasonable fees and expenses of such tax counsel, benefits consultants,
accountants or other experts. If, subsequent to the payment to Executive of payments pursuant to
this Section 4(d), the tax counsel referred to in this Section 4(d) reasonably determines that the
amount of the payments paid pursuant to this Section 4(d) are greater than, or less than, the
amount required to have been paid, Executive shall reimburse the Company an amount, or the Company
shall pay Executive an additional amount, respectively, based upon such determination. In the
event that tax counsel referred to in this Section 4(d) reasonably determines that Executive is
required to pay excise tax, interest or penalties to a governmental taxing authority as a result of
his non-payment of taxes where such tax counsel had determined that such taxes need not be paid or
as a result of a miscalculation of such taxes, the Company shall pay to Executive an additional
amount equal to (A) the amount of such interest and/or penalties, (B) the excise tax which was not
paid and (C) any excise tax and any other taxes imposed by the Code or under state or local law on
the payments provided for in this sentence.

5. Termination

(a) Generally. Either the Board of Directors of the Company or Executive may
terminate Executive’s employment hereunder, for any reason, at any time prior to expiration of the
Term of Employment, upon sixty (60) days prior written notice to the other party.

(b) Executive’s Voluntary Resignation. If Executive voluntarily resigns from his
employment by the Company, Executive shall not be entitled to receive any further payments from the
Company hereunder other than amounts earned through the termination date including accrued and
unpaid salary and reimbursement for expenses in accordance with Section 3 hereof (“Accrued
Compensation”), and the Options shall immediately terminate. Additionally, this Agreement shall
immediately terminate and be of no further force and effect.

(c) Termination with Cause. If Executive’s employment by the Company is terminated by
the Company with Cause, Executive shall not be entitled to receive any further payments from the
Company other than Accrued Compensation, and the Options shall immediately terminate.
Additionally, this Agreement shall immediately terminate and be of no further force or effect.

(d) Termination Without Cause. If Executive’s employment by the Company is terminated
by the Company without Cause, Executive shall not be entitled to receive any further salary from
the Company. Executive shall be entitled to receive Accrued Compensation. Additionally, the
Options shall remain valid and in effect for six (6) months following such termination.

(e) Death or Permanent Disability. If Executive’s employment hereunder is terminated
due to death or Permanent Disability, Executive (or Executive’s estate) shall be entitled to
receive Accrued Compensation. Additionally, if the Executive’s employment hereunder is terminated
due to death or Permanent Disability at any time after the first anniversary of the Effective Date,
then the Options shall remain valid and in effect for six (6) months following such termination; if
a Change in Control occurs during such six-month period, the Options shall vest and Executive will
receive a bonus payment, in accordance with Section 4 hereof. After such six-month period, if no
Change in Control has occurred, the Options shall terminate.

6. Non-Compete; Non-Solicitation

(a) Non-Compete. Executive acknowledges and agrees that during the Term of Employment
and through the end of the Restricted Period, Executive will not, directly or indirectly, singly or
jointly, on Executive’s own behalf or on behalf of any third party, establish, create, be employed
by, serve as an officer, director, advisor or consultant to, lend money to, invest in, provide
advice to, or engage or otherwise participate in any way in Competitive Business. Executive may
own up to one percent (1%) of any class of securities of any entity without violating this Section
6(a). Nothing in this Section 6(a) shall prevent Executive from working for or performing services
on behalf of any individual or entity that is engaged in Competitive Business if such individual or
entity is also engaged in other lines of business and if Executive’s employment or services are
restricted to such other lines of business, and Executive will not be providing support, advice,
instruction, direction or other guidance to lines of business that constitute Competitive Business.

(b) Non-Solicitation of Customers. During the Restricted Period, Executive shall not
solicit any actual or prospective customer of the Company as to which Executive had access during
the Term of Employment with respect to the purchase of products or services from a Competitive
Business.

(c) Non-Solicitation of Employees. During the Restricted Period, Executive agrees
that he will not, directly or indirectly, whether for himself or for any other individual or
entity, solicit, or endeavor to hire away or solicit away from the Company, or otherwise induce to
terminate their relationship with the Company, any employee of the Company at the time of
Executive’s cessation of employment with the Company.

7. Confidentiality 

(a) Non-Disclosure. In connection with Executive’s employment by the Company,
Executive will be given access to confidential and proprietary information and trade secrets
concerning the business, plans, operations and prospects of the Company and other information not
generally known outside of the Company that may be of value to the Company. Furthermore, in
connection with Executive’s employment with the Company, Executive will be given confidential and
proprietary information and trade secrets that have been given to the Company or the Company in
confidence by third parties (the confidential and proprietary information and trade secrets of the
Company and third parties, as further defined in Section 7(b), shall be referred to herein as
“Confidential Information”). Executive understands that employment by the Company creates a
relationship of confidence and trust with respect to any such Confidential Information that has
been or may be disclosed to Executive and that the Company has a protectable business interest in
its Confidential Information. Executive acknowledges and agrees that using, disclosing or
publishing any Confidential Information in an unauthorized or improper manner could cause the
Company substantial loss and damages that could not be readily calculated and for which no remedy
at law would be adequate. Accordingly, Executive acknowledges and agrees that Executive shall not
at any time, except in performing Executive’s employment duties to the Company under this Agreement
(except with the prior written consent of the Company’s Board of Directors), directly or
indirectly, use, disclose or publish any Confidential Information that Executive may learn or
become aware of, or have learned or become aware of because of Executive’s prior or continuing
employment, ownership or association with the Company, or use any such information in a manner
detrimental to the interests of the Company. Executive understands and agrees that the rights and
obligations set forth in this Section 7(a) will continue indefinitely and will survive termination
of this Agreement and Executive’s employment by the Company.

(b) Confidential Information. “Confidential Information” includes, without
limitation, information not previously disclosed to the public or to the trade by the Company with
respect to the Company’s present or future business, operations, services, products, research,
inventions, discoveries, drawings, designs, plans, processes, models, technical information,
facilities, methods, trade secrets, copyrights, software, source code, systems, patents,
procedures, manuals, specifications, any other intellectual property, confidential reports, price
lists, pricing formulas, customer lists, financial information (including the revenues, costs, or
profits associated with any of the Company’s products or services), business plans, lease
structure, projections, prospects, or opportunities or strategies, acquisitions or mergers,
advertising or promotions, personnel matters, legal matters, any other confidential and proprietary
information and any other information not generally known outside the Company that may be of value
to the Company, but excludes any information already properly in the public domain. “Confidential
Information” also includes confidential and proprietary information and trade secrets that third
parties entrust to the Company in confidence.

“Confidential Information” does not include any information that (i) has been
properly published in a form generally available to the public prior to the date Executive proposes
to disclose or use such information or otherwise is or becomes public knowledge through legal means
without fault by Executive, (ii) is already public knowledge prior to the signing of this
Agreement, (iii) was available to Executive on a non-confidential basis prior to its disclosure by
the Company, (iv) was disclosed by Executive in the proper discharge of Executive’s duties and
responsibilities hereunder, or (v) must be disclosed pursuant to applicable law or court order.
Information shall not be deemed to have been published merely because individual portions of the
information have been separately published, but only if all material features comprising such
information have been published in combination.

(c) Surrender of Records and Property. Upon termination of his employment hereunder,
Executive shall deliver promptly to the Company any Confidential Information or other materials not
available to the public, and any copies, excerpts, summaries, compilations of the foregoing.

8. General

(a) Governing Law. This Agreement shall be construed, interpreted and governed by the
laws of the State of Minnesota, without regard to the conflicts of law rules thereof.

(b) Binding Effect. This Agreement shall extend to and be binding upon Executive, his
legal representatives, heirs and distributees and upon the Company, its successors and assigns
regardless of any change in the business structure of the Company

(c) Assignment. Neither this Agreement nor any of the rights or obligations hereunder
shall be assigned or delegated by any party without the prior written consent of the other party.

(d) Entire Agreement. Except for any stock option or stock award agreements between
the parties, this Agreement contains the entire agreement of the parties with respect to the
subject matter hereof. No waiver, modification or change of any provision of this Agreement shall
be valid unless in writing and signed by both parties.

(e) Waiver. The waiver of any breach of any duty, term or condition of this Agreement
shall not be deemed to constitute a waiver of any preceding or succeeding breach of the same or any
other duty, term or condition of this Agreement.

(f) Severability. If any provision of this Agreement shall be unenforceable in any
jurisdiction in accordance with its terms, the provision shall be enforceable to the fullest extent
permitted in that jurisdiction and shall continue to be enforceable in accordance with its terms in
any other jurisdiction and the validity, legality and enforceability of the remaining provisions
contained herein shall not be affected thereby.

(g) Arbitration. Any claim or controversy arising out of, or relating to, this
Agreement between Executive and the Company (or any officer, director, employee or agent of the
Company), or the breach thereof, shall be settled by arbitration administrated by the American
Arbitration Association under its National Rules for the Resolution of Employment Disputes. Such
arbitration shall be held in Minnesota (or in such other location as the Company may at the time be
headquartered). The arbitration shall be conducted before a three-member panel. Within fifteen
(15) days after the commencement of arbitration, each party shall select one person to act as
arbitrator and the two selected shall select a third arbitrator within ten (10) days of their
appointment. If the arbitrators selected by the parties are unable or fail to agree upon the third
arbitrator, the third arbitrator shall be selected by the American Arbitration Association and
shall be a member of the bar of the State of Minnesota actively engaged in the practice of
employment law for at least ten (10) years. The arbitration panel shall apply the substantive laws
of the State of Minnesota in connection with the arbitration and the Minnesota Rules of Evidence
shall apply to all aspects of the arbitration. The award shall be made within thirty days of the
closing of the hearing. Judgment upon the award rendered by the arbitrator(s) may be entered by
any court having jurisdiction thereof.

(h) Notices. All notices pursuant to this Agreement shall be in writing and shall be
sent by prepaid certified mail, return receipt requested or by recognized air courier service
addressed as follows:

If to the Company to:

Diametrics Medical, Inc.

Attn: David B. Kaysen

3050 Centre Pointe Drive, Suite 150

Roseville, Minnesota 55113

with a copy (which shall not constitute notice) to:

Dorsey & Whitney LLP

50 South Sixth Street, Suite 1500

Minneapolis, MN 55402

Attention: Kenneth L. Cutler, Esq.

If to Executive to:

Mr. William P. Moffitt

942 Pine Tree Lane

Winnetka, IL 60093

with a copy (which shall not constitute notice) to:

Paul, Hastings, Janofsky & Walker LLP

1055 Washington Boulevard

Stamford, Connecticut 06901

Attention: Esteban A. Ferrer, Esq.

or to such other addresses as may hereinafter be specified by notice in writing by either of the
parties, and shall be deemed given three (3) business days after the date so mailed or sent.

(i) Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed an original but all of which shall together constitute one and the same agreement.

1

IN WITNESS WHEREOF, the parties to this Agreement, intending to be legally bound, have
executed this Agreement as of the date first set forth above.

	 
	DIAMETRICS MEDICAL, INC.,
	a Minnesota corporation.
	_/s/ David B. Kaysen____________________
	Name: David B. Kaysen
	Title: President and CEO
	MR. WILLIAM P. MOFFITT,
	an individual.
	__/s/ William P. Moffitt__________________
	 

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