Document:

Exhibit 10.1

 

June 8, 2004

 

Mr. Rodney A. Young

5804 Olinger Road

Edina, Minnesota 55436

 

Dear Mr. Young

 

We write to set
forth our agreement with respect to your employment as an officer of Angeion
Corporation (the “Company”) commencing July 6, 2004 (the “Employment Date”).

 

1.             Employment.

 

The Company hereby
agrees to employ you, and you agree to be employed by the Company, on the terms
and conditions hereinafter set forth. 
Effective July 6, 2004, you will serve as Executive Vice President of
the Company.  Beginning November 1,
2004, you will serve as the President and Chief Executive Officer of the
Company.

 

At no additional
compensation, you will be elected as a member of the Board of Directors of the
Company effective as of November 1, 2004 (or such earlier date as you and the
Board of Director jointly agree), and in such other directorships, Board
committee memberships and offices of the Company and its subsidiaries
(including November 1, 2004, President and Chief Executive Officer of Medical
Graphics) to which you may from time to time be elected or appointed by the
Chairman of the Board of the Company. 
You agree to serve the Company faithfully and, to the best of your
ability, to promote the Company’s interest, and to devote your full working
time, energy and skill to the Company’s business.  You may attend to personal business and investment, engage in
charitable activities and community affairs, and serve on a reasonable number
of corporate, educational and civic boards, so long as those activities do not
interfere with your duties under this Agreement.  Your service on any corporate boards on which you did not serve
as of the date hereof is subject to prior approval by the Board of Directors.

 

You will have such
authority, powers, functions, duties, and responsibilities as are normally
accorded executive officers serving in the respective capacities in which you
serve.  You will discharge your duties
at all times in accordance with any and all policies established by the Board
of Directors and will report to, and be subject to the direction of, the Board
of Directors.

 

2.             Base Salary.

 

As partial
compensation for all of your services (including services as director, Board
committee member or officer of the Company and its subsidiaries) during your
term of employment hereunder, you will receive a base salary at an annual rate
of no less than Two Hundred Thirty Thousand Dollars ($230,000), payable in
biweekly

 

 

installments.  This base salary
will be reviewed annually and subject to increase at the discretion of the
Board.

 

3.             Cash Bonus; Stock
Awards and Options.

 

(a)           As additional
compensation for your services, beginning November 1, 2004, you will be
eligible to earn cash bonus compensation for each fiscal year up to a target of
35% of your annual salary, and an over-achievement bonus of up to an additional
15% of your annual salary, which percentage targets will be reviewed annually
and subject to increase at the discretion the Board.  Bonuses each year will be determined by the Board of Directors in
accordance with a bonus plan to be established by mutual agreement between you
and the Board of Directors for that year.

 

(b)           You will participate in
the Angeion 2004 Bonus Program on a pro rata basis from the Employment Date
through October 31, 2004.

 

(c)           You will participate in
the third year of the Angeion Long Term Incentive Bonus Plan ending October 31,
2005.

 

(d)           You will be granted
stock options in the amount set forth in Exhibit A.

 

4.             Fringe Benefits.

 

(a)           You will be eligible to
participate in any and all Company sponsored insurance (including medical,
dental, life and disability insurance), retirement, and other fringe benefit
programs that it maintains for its executive officers, subject to and on a
basis consistent with the terms of each such plan or program.

 

(b)           You will be entitled to
four weeks of paid vacation annually.

 

(c)           The Company will pay or
reimburse you $600 per month for all costs associated with a private automobile
selected by you, including, but not limited to, lease costs, gas, repairs,
general maintenance and insurance.

 

5.             Expenses.

 

During the term of
your employment, the Company will reimburse you for your reasonable travel and
other expenses incident to your rendering of services in conformity with its
regular policies regarding reimbursement of expenses as in effect from time to
time.  Payments to you under this
paragraph will be made upon presentation of expense vouchers in such detail as
the Company may from time to time reasonably require.

 

6.             Term and
Termination.

 

(a)           Term.  Your employment with the Company will
continue unless and until terminated in accordance with the terms of this
Agreement.

 

2

 

(b)           Termination.  Your employment under this Agreement may be
terminated as follows:

 

(i)            By
your resignation upon 60 days prior written notice to the Company.

 

(ii)           By
the Company for Cause (as defined in this Agreement) immediately upon written
notice to you.

 

(iii)          By the Company for any reason and at any time
upon 60 days prior written notice to you.

 

(iv)          By
the Company at any time in the event of your Disability (as defined in this
Agreement).

 

In the event of
your termination of employment for any of the foregoing reasons, you must
immediately resign as a director of the Company and any of its subsidiaries.

 

(c)           Death.  This Agreement will automatically terminate
upon your death.

 

7.             Consequences of
Termination.

 

(a)           Termination for
Cause; Resignation Prior to Change in Control or More Than 24 Months After
Change in Control.  If your
employment is terminated at any time by the Company for Cause or if you resign
prior to a Change in Control (as defined in the separate Change-in-Control
Agreement attached hereto (the “Change-in-Control Agreement”)) or more than
24 months after a Change in Control, then you will be paid (i) your
base salary to the date of termination and (ii) the unpaid portion of any bonus
or incentive amount earned by you for the fiscal year ending prior to the
termination of your employment that you are entitled to receive under the terms
of the annual incentive plan.  You will
not be entitled to receive any base salary or fringe benefits for any period
after the date of termination, except for the right to receive benefits that
have become vested under any benefit plan or to which you are entitled as a
matter of law.

 

(b)           Termination without
Cause Prior to Change in Control or More Than 24 Months After Change in Control.  If the Company terminates your employment
without Cause prior to a Change in Control or more than 24 months after a
Change in Control, then:

 

(i)            The
Company will pay you a lump sum equal to 12 months of your current base
salary, less applicable tax withholdings; and

 

(ii)           The
Company will pay the unpaid portion of any bonus or incentive amount earned by
you for the fiscal year ending prior to the termination of your employment that
you are entitled to receive under the terms of the applicable incentive plan;
and

 

3

 

(iii)          You will be entitled to continued
participation in the health care coverage, and life insurance benefit plans of
the Company, as in effect on the date of your termination as permitted by
law.  The Company will continue to pay
its share of the health care and life insurance premiums for this coverage for
a period of up to 12 months, and you will be obligated to pay your share
of the cost associated with that coverage as if you were still actively
employed by the Company.  If you cannot
be covered under any of the Company’s group plans or policies, the Company will
reimburse you for your full cost of obtaining comparable alternative or
individual coverage elsewhere, less any contribution that you would have been
required to make under the Company’s group plans or policies.  If, during the aforesaid 12-month period,
you are employed by a third party and become eligible for any health care or
life insurance coverage provided by that third party, the Company will not,
thereafter, be obligated to provide you with the insurance benefits described
in this paragraph (b)(iii).  This
12-month coverage shall run concurrently with COBRA and thereafter you will be
responsible for the full cost of any coverage thereafter.

 

(c)           Termination in the
Event of Death or Disability.  If
your employment terminates due to your death or if the Company terminates your
employment due to a Disability, then

 

(i)            The
Company will continue to pay your base salary to your estate or to you for the
remainder of the month in which your death occurs or in which your employment
is terminated due to Disability, together with the unpaid portion of any bonus
or incentive amount earned by you for the fiscal year ending prior to the
termination of your employment that you are entitled to receive under the terms
of the applicable incentive plan; and in the event of termination due to
Disability, you will continue to receive, during that month, all of the fringe
benefits then being paid or provided to you;

 

(ii)           You
will be entitled to receive all Disability and other benefits, such as
continued health coverage or life insurance proceeds, provided in accordance
with the terms and conditions of the health care coverage, life insurance,
disability, or other employee benefit plans of the Company and applicable law.

 

(d)           Termination Within
24 Months After Change in Control. 
If, within 24 months after a Change in Control, your employment
terminates, your rights will be governed by the Change-in-Control Agreement
attached hereto and executed concurrently herewith.  After the expiration of such 24-month period, you rights will
again be governed solely by this agreement.

 

(e)           The benefits provided
you under this Section 7 or in the Change-in-Control Agreement are in lieu
of any benefits that would otherwise be provided to you under any severance pay
or other policies of the Company.

 

4

 

8.             No Mitigation.  Following termination of your employment for
any reason you will be under no obligation to mitigate your damages by seeking
other employment, and there will be no offset against the amounts due you under
Section 7, except as specifically provided in Section 7(b)(iii) or
for any claims which the Company may have against you.

 

9.             Property Rights,
Confidentiality, Non-Solicit and Non-Compete Provisions.

 

(a)           Company’s Property.

 

(i)            You
must promptly disclose to the Company in writing all inventions, discoveries,
and works of authorship, whether or not patentable or copyrightable, that are
conceived, made, discovered, written, or created by you alone or jointly with
another person, group, or entity, whether during the normal hours of employment
at the Company or on your own time, during the term of this Agreement.  You agree to assign all rights to all such
inventions and works of authorship to the Company.  You further agree to give the Company any of the assistance it
reasonably requires in order for the Company to perfect, protect and use its
rights to inventions and works of authorship.

 

This provision
does not apply to an invention, discovery, or work of authorship for which no
equipment, supplies, facility, or trade secret information of the Company was
used and that was developed entirely on your own time and that does not relate
to the business of the Company, to the Company’s anticipated research or
developments, or does not result from any work performed by you for the
Company.

 

(ii)           You
may not remove any records, documents, or any other tangible items (excluding
your personal property) from the premises of the Company in either original or
duplicate form, except as is needed in the ordinary course of conducting
business for the Company.

 

(iii)          You must immediately deliver to the Company,
upon termination of employment with the Company, or at any other time upon the
Company’s request, any property, records, documents, and other tangible items
(excluding your personal property) in your possession or control, including
data incorporated in word processing, computer, and other data storage media,
and all copies of such records, documents, and information, including all
Confidential Information, as defined below.

 

(b)           Confidential
Information.  During the course of
your employment you will develop, become aware of, and accumulate expertise,
knowledge, and information regarding the Company’s and its subsidiaries’
organization strategies, business, and operations and their past, current, or
potential customers, and suppliers.  The
Company considers such expertise, knowledge, and information to be valuable,
confidential, and proprietary, and it is considered Confidential Information
for purposes of this Agreement.  During
this Agreement and at all times thereafter you will agree not to use such
Confidential Information or disclose it to other persons or entities except as
is necessary

 

5

 

for the performance of
your duties for the Company or as has been expressly permitted in writing by
the Company.  The foregoing covenant
does not apply to any information possessed by you prior to your employment by
the Company, or to any information that is in or has entered the pubic domain
or has been disclosed with any industry segment in which the Company or any
subsidiary or affiliated company of the Company operates by or pursuant to the
authority of the Company or any subsidiary or affiliated company of the
Company.

 

(c)           Non-Solicitation.  During (i) the term of this Agreement,
and (ii) the greater of (A) any period for which you are receiving
payments under Section 7 of this Agreement, or (B) one year after the
termination of this Agreement or the date on which you are no longer employed
by the Company in any capacity, whichever shall last occur, you may not
directly or indirectly attempt to hire away any then-current employee of the
Company or any subsidiary or to persuade any such employee to leave employment
with the Company or any subsidiary.

 

(d)           Non-Competition.  During (i) the term of this Agreement
and (ii) the greater of (A) any period for which you are receiving
payments under Section 7 of this Agreement, or (B) one year after
termination of this Agreement or the date on which you are no longer employed
by the Company in any capacity, whichever shall last occur, you may not engage
or participate, either individually or as an employee, consultant, or principal,
partner, agent, trustee, officer, or director of a corporation, partnership, or
other business entity, in any business in which the Company or any subsidiary
in which the Company has a more than 20 percent equity interest, was engaged
prior to the termination of this Agreement. 
Mere ownership by you of not more than 5% of the outstanding common
stock of a company the securities of which are publicly traded will not
constitute competition for purposes of this Section 9(d).

 

The provisions of
this Section 9 survive the termination of this Agreement.

 

10.           Arbitration.  Any disputes arising under or in connection
with this Agreement (including without limitation the making of this Agreement)
must be resolved by final and binding arbitration to be held in Minneapolis,
Minnesota in accordance with the rules and procedures of the American
Arbitration Association.  The parties
will select a mutually agreeable single arbitrator to resolve the dispute or if
they fail or are unable to do so, each side will within the following ten (10)
business days select a single arbitrator and the two so selected will select a
third arbitrator within the following ten (10) business days.  The arbitration award or other resolution may
be entered as a judgment at the request of the prevailing party by any court of
competent jurisdiction in Minnesota or elsewhere.  The arbitrator will have no power to award any punitive or
exemplary damages.  The arbitrator may
construe or interpret, but may not ignore or vary the terms of this Agreement,
and may be bound by controlling law. 
You acknowledge that your failure to comply with the terms of the
Agreement regarding Confidential Information, Inventions, and Non-Competition
could cause immediate and irreparable injury to the Company and that therefore,
the arbitrators, or a court of competent jurisdiction, if an arbitration panel
cannot immediately be convened, will be empowered to provide injunctive relief,
including temporary or preliminary relief, to restrain any such failure to

 

6

 

comply.  Each party will bear its own costs and
attorneys’ fees in connection with the arbitration.

 

11.           Definitions.  For purposes of this Agreement, the
following terms will have the meanings set forth below:

 

(a)           Cause.  “Cause” has the meaning given to it in the
Change-in-Control Agreement.

 

(b)           Disability.  “Disability” means that you are deemed to be
disabled under the terms of the Company’s long term disability plan and have
satisfied the qualifying period for entitlement to benefits under such plan.

 

12.           General Provisions.

 

(a)           This Agreement may not
be amended or modified except by a written agreement signed by both of us.

 

(b)           In the event that any
provision or portion of this agreement is determined to be invalid or
unenforceable for any reason, the remaining provisions of this Agreement will
remain in full force and effect to the fullest extent permitted by law.

 

(c)           This Agreement will
bind and benefit the parties hereto and their respective successors and
assigns, but none of your rights or obligations hereunder may be assigned by
either party hereto without the written consent of the other, except by
operation of law upon your death.

 

(d)           This Agreement has been
made in and shall be governed and construed in accordance with the laws of the
State of Minnesota without giving effect to the principles of conflict of laws
of any jurisdiction.

 

(e)           No failure on the part
of either party to exercise, and no delay in exercising, any right or remedy
under this Agreement will operate as a waiver; nor will any single or partial
exercise of any right or remedy preclude any other or further exercise of any
right or remedy.

 

7

 

(f)            Any notice or other
communication under this Agreement must be in writing and will be deemed given
when delivered in person, by overnight courier (with receipt confirmed), by
facsimile transmission (with receipt confirmed by telephone or by automatic
transmission report), or upon receipt if sent by certified mail, return receipt
requested, as follows (or to such other persons and/or addresses as may be
specified by written notice to the other party):

 

If to Angeion Corporation:

 

Angeion Corporation

Attention: 
Chairman of the Board of Directors

350 Oak Grove Parkway

St. Paul, MN 55127

 

If to Rodney A. Young

 

Mr. Rodney A. Young

5804 Olinger Road

Edina, Minnesota 55436

 

(g)           This Agreement, the
Change-in-Control Agreement and the stock option agreements ancillary hereto,
contains our entire understanding and agreement with respect to these matters
and supersedes all previous agreements, discussions, or understandings, whether
written or oral, between or on the same subjects.

 

(h)           In the event any
provision of this Agreement is held unenforceable, that provision will be
severed and shall not affect the validity or enforceability of the remaining
provisions.  In the event any provision
is held to be overbroad, that provision shall be deemed amended to narrow its
application to the extent necessary to render the provision enforceable
according to applicable law.

 

(i)            All terms of this
Agreement intended to be observed and performed after the termination of this
Agreement will survive such termination and will continue in full force and
effect thereafter, including without limitation, Section 7, Consequence of
Termination; Section 8, No Mitigation; Section 9, Property Rights,
Confidentiality, Non-Solicit and Non-Compete Provisions; Section 10,
Arbitration; Section 11, Definitions; and Section 12, General Provisions.

 

(j)            The headings contained
in this Agreement are for convenience only and in no way restrict or otherwise
affect the construction of the provisions hereof.  Unless otherwise specified herein, references in this Agreement
to Sections or Exhibits are to the sections or exhibits to this Agreement.  This Agreement may be executed in multiple
counterparts, each of which is an original and all of which together will
constitute one and the same instrument.

 

8

 

If the foregoing
correctly sets forth your understanding of our agreement, please indicate so by
signing and returning to us a copy of this letter.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  ANGEION CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Arnold A. Angeloni

  	
   

  
	
   

  	
  Arnold A. Angeloni,
  Chairman

  
	
   

  	
   

  
	
  Accepted and agreed to:

  	
   

  
	
   

  	
   

  
	
  /s/ Rodney A. Young

  	
   

  	
   

  
	
  Rodney A. Young

  	
   

  
				

 

9

 

Exhibit A.

Options

 

	
  Options

  	
   

  	
  Exercise
  price

  	
   

  	
  Vesting

  	
   

  	
  Expiration

  	
   

  	
  Comments

  
	
  24,000

  	
   

  	
  2.00

  	
   

  	
  10/1/2009 (1)

  	
   

  	
  October 25, 2012

  	
   

  	
  Subject to earlier vesting if common stock FMV
  equals or exceeds the price set forth below. 
  Subject to earlier termination after employment ends.

  
	
  24,000

  	
   

  	
  $

  	
  6.23

  	
   

  	
  Immediately.

  	
   

  	
  October 25, 2012

  	
   

  	
  Subject to earlier termination after employment ends.

  
	
  33,000

  	
   

  	
  $

  	
  7.79

  	
   

  	
  One-half on October 25, 2004; balance on October 25,
  2005.

  	
   

  	
  October 25, 2012

  	
   

  	
  Subject to earlier termination after employment
  ends.

  

 

(1) The Option may be exercised in full beginning
October 1, 2009.  The Option will become
exercisable earlier, however, if the Common Stock trades at the following price
for 20 of 30 consecutive trading days.

 

	
  Closing
  Price

  	
   

  	
  Percent of
  Option Exercisable

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  $

  	
  4.00

  	
   

  	
   

  	
  15

  	
  %

  
	
  $

  	
  4.50

  	
   

  	
   

  	
  40

  	
  %

  
	
  $

  	
  5.00

  	
   

  	
   

  	
  60

  	
  %

  
	
  $

  	
  5.50

  	
   

  	
   

  	
  80

  	
  %

  
	
  $

  	
  6.00

  	
   

  	
   

  	
  100

  	
  %

  

 

10Exhibit
10.2

 

July 6, 2004

 

Mr. Rodney A. Young

5804 Olinger Road

Edina, Minnesota 55436

 

Dear Mr. Young,

 

The Board considers the
establishment and maintenance of a sound and vital management to be essential
to protecting and enhancing the best interests of the Company and its
shareholders.  In this connection, the
Board recognizes that the possibility of a Change in Control may arise and that
this possibility and the uncertainty and questions that it may raise among
management may result in the departure or distraction of management personnel
to the detriment of the Company and its shareholders.

 

Accordingly, the Board
has determined that appropriate steps should be taken to minimize the risk that
Company management will depart prior to a Change in Control, thereby leaving
the Company without adequate management personnel during such a critical
period, and to reinforce and encourage the continued attention and dedication
of members of the Company’s management to their assigned duties without
distraction in circumstances arising from the possibility of a Change in
Control.  In particular, the Board
believes it important, should the Company or its shareholders receive a
proposal for transfer of control, that you be able to continue your management
responsibilities without being influenced by the uncertainties of your own
personal situation.

 

The Board recognizes that
continuance of your position with the Company involves a substantial commitment
to the Company in terms of your personal life and professional career and the
possibility of foregoing present and future career opportunities, for which the
Company receives substantial benefits. 
Therefore, to induce you to remain in the employ of the Company, this
Agreement, which has been approved by the Board, sets forth the benefits that
the Company agrees will be provided to you in the event your employment with
the Company is terminated in connection with a Change in Control under the
circumstances described below.

 

1.             Definitions.  The following terms will have the meaning
set forth below unless the context clearly requires otherwise.  Terms defined elsewhere in this Agreement
will have the same meaning throughout this Agreement.

 

(a)           “Affiliate”
means (i) any corporation at least a majority of whose outstanding securities
ordinarily having the right to vote at elections of directors is owned directly
or indirectly by the Parent Corporation or (ii) any other form of business
entity in that the Parent Corporation, by virtue of a direct or indirect
ownership interest, has the right to elect a majority of the members of such
entity’s governing body.

 

Rodney A. Young Change in Control

 

 

(b)           “Agreement”
means this letter agreement as amended, extended or renewed from time to time
in accordance with its terms.

 

(c)           “Base Pay” means
your annual base salary from the Company at the rate in effect immediately
prior to a Change in Control or at the time Notice of Termination is given,
whichever is greater.  Base Pay includes
only regular cash salary and is determined before any reduction for deferrals
pursuant to any nonqualified deferred compensation plan or arrangement,
qualified cash or deferred arrangement or cafeteria plan.

 

(d)           “Benefit Plan”
means any

 

(i)            employee benefit plan
as defined in Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended;

 

(ii)           cafeteria plan
described in Code Section 125;

 

(iii)          plan, policy or practice
providing for paid vacation, other paid time off or short- or long-term profit
sharing, bonus or incentive payments; or

 

(iv)          stock option, stock
purchase, restricted stock, phantom stock, stock appreciation right or other
equity-based compensation plan that is sponsored, maintained or contributed to
by the Company for the benefit of employees (or their families and dependents)
generally or you (or your family and dependents) in particular.

 

(e)           “Board” means
the board of directors of the Parent Corporation duly qualified and acting at
the time in question.  On and after the
date of a Change in Control, any duty of the Board in connection with this
Agreement is nondelegable and any attempt by the Board to delegate any such
duty is ineffective.

 

(f)            “Cause” means:
(i) your gross misconduct; (ii) your willful and continued failure to
perform substantially your duties with the Company (other than a failure
resulting from your incapacity due to bodily injury or physical or mental
illness) after a demand for substantial performance is delivered to you by the
chair of the Board that specifically identifies the manner in which you have
not substantially performed your duties and provides for a reasonable period of
time within which you may take corrective measures; or (iii) your
conviction (including a plea of nolo contendere) of willfully engaging in
illegal conduct constituting a felony or gross misdemeanor under federal or
state law that is materially and demonstrably injurious to the Company or that
impairs your ability to perform substantially your duties for the Company.  An act or failure to act will be considered
“gross” or “willful” for this purpose only if done, or omitted to be done, by
you in bad faith and without

 

2

 

reasonable belief
that it was in, or not opposed to, the best interests of the Company.  Any act, or failure to act, based upon
authority given pursuant to a resolution duly adopted by the Company’s board of
directors (or a committee thereof) or based upon the advice of counsel for the
Company will be conclusively presumed to be done, or omitted to be done, by you
in good faith and in the best interests of the Company.  Notwithstanding the foregoing, you may not
be terminated for Cause unless and until there has been delivered to you a copy
of a resolution duly adopted by the affirmative vote of not less than a
majority of the entire membership of the Board at a meeting of the Board called
and held for the purpose (after reasonable notice to you and an opportunity for
you, together with your counsel, to be heard before the Board), finding that in
the good faith opinion of the Board you were guilty of the conduct set forth
above in clauses (i), (ii) or (iii) of this definition and specifying the
particulars thereof in detail.

 

(g)           “Change in Control”
means any of the following: (i) the sale, lease, exchange or other
transfer, directly or indirectly, of all or substantially all of the assets of
the Parent Corporation, in one transaction or in a series of related
transactions, to any Person; (ii) any Person, other than a “bona fide
underwriter,” is or becomes the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of (a) 20 percent or
more, but not 50 percent or more, of the combined voting power of the Parent
Corporation’s outstanding securities ordinarily having the right to vote at
elections of directors, unless the person is currently the beneficial holder 20
percent or more of the combined voting power of the Parent Corporation’s
securities or unless the transaction resulting in such ownership has been
approved in advance by the “continuity directors” or (b) 50 percent or
more of the combined voting power of the Parent Corporation’s outstanding
securities ordinarily having the right to vote at elections of directors
(regardless of any approval by the continuity directors); (iii) a merger
or consolidation to which the Parent Corporation is a party if the shareholders
of the Parent Corporation immediately prior to the effective date of such
merger or consolidation have, solely on account of ownership of securities of the
Parent Corporation at such time, “beneficial ownership” (as defined in Rule
13d-3 under the Exchange Act) immediately following the effective date of such
merger or consolidation of securities of the surviving company representing
(a) more than 50 percent, but less than 80 percent, of the combined voting
power of the surviving corporation’s then outstanding securities ordinarily
having the right to vote at elections of directors, unless such merger or
consolidation has been approved in advance by the continuity directors, or
(b) 50% or less of the combined voting power of the surviving
corporation’s then outstanding securities ordinarily having the right to vote
at elections of directors (regardless of any approval by the continuity
directors); (iv) the continuity directors cease for any reason to
constitute at least a majority the Board; or (v) a change in control of a
nature that is determined by outside legal counsel to the Parent Corporation,
in a written opinion specifically referencing

 

3

 

this provision of
the Agreement, to be required to be reported (assuming such event has not been
“previously reported”) pursuant to Section 13 or 15(d) of the Exchange Act,
whether or not the Parent Corporation is then subject to such reporting
requirement.

 

For purposes of
this Section 1(g), a “continuity director” means any individual who is a member
of the Board at the date hereof, while he or she is a member of the Board, and
any individual who subsequently becomes a member of the Board whose election or
nomination for election by the Parent Corporation’s shareholders was approved
by a vote of at least a majority of the directors who are continuity directors
(either by a specific vote or by approval of the proxy statement of the Parent
Corporation in which such individual is named as a nominee for director without
objection to such nomination).  For
purposes of this Section 1(g), a “bona fide underwriter” means a Person engaged
in business as an underwriter of securities that acquires securities of the
Parent Corporation through such Person’s participation in good faith in a firm
commitment underwriting until the expiration of 40 days after the date of such
acquisition.

 

(h)           “Code” means the
Internal Revenue Code of 1986, as amended. 
Any reference to a specific provision of the Code includes a reference
to such provision as it may be amended from time to time and to any successor
provision.

 

(i)            “Company” means
the Parent Corporation, any Successor and any Affiliate.

 

(j)            “Date of
Termination” following a Change in Control (or prior to a Change in Control
if your termination was either a condition of the Change in Control or was at
the request or insistence of any Person related to the Change in Control)
means: (i) if your employment is to be terminated by you for Good Reason,
the date specified in the Notice of Termination which in no event may be a date
more than 15 days after the date on which Notice of Termination is given unless
the Company agrees in writing to a later date; (ii) if your employment is
to be terminated by the Company for Cause, the date specified in the Notice of
Termination; (iii) if your employment is terminated by reason of your
death, the date of your death; or (iv) if your employment is to be
terminated by the Company for any reason other than Cause or your death, the
date specified in the Notice of Termination, which in no event may be a date
earlier than 15 days after the date on which a Notice of Termination is given,
unless you expressly agree in writing to an earlier date.  In the case of termination by the Company of
your employment for Cause, if you have not previously expressly agreed in
writing to the termination, then within the 30-day period after your receipt of
the Notice of Termination, you may notify the Company that a dispute exists
concerning the termination, in which event the Date of Termination will be the
date set either by mutual written agreement of the parties or by the judge or
arbitrators in a proceeding as provided in Section 11 of this Agreement.  During the pendency of any such

 

4

 

dispute, you will
continue to make yourself available to provide services to the Company and the
Company will continue to pay you your full compensation and benefits in effect
immediately prior to the date on which the Notice of Termination is given
(without regard to any changes to such compensation or benefits that constitute
Good Reason) and until the dispute is resolved in accordance with Section 11 of
this Agreement.  You will be entitled to
retain the full amount of any such compensation and benefits without regard to
the resolution of the dispute unless the judge or arbitrators decide(s) that
your claim of a dispute was frivolous or advanced by you in bad faith.

 

(k)           “Exchange Act”
means the Securities Exchange Act of 1934, as amended.  Any reference to a specific provision of the
Exchange Act or to any rule or regulation thereunder includes a reference to
such provision as it may be amended from time to time and to any successor
provision.

 

(l)            “Good Reason”
means:

 

(i)            a change in your
status, position(s), duties or responsibilities as an executive of the Company
as in effect immediately prior to the Change in Control which, in your
reasonable judgment, is adverse (other than, if applicable, any such change
directly attributable to the fact that the Parent Corporation is no longer
publicly owned); provided, however, that Good Reason does not include a change
in your status, position(s), duties or responsibilities caused by an
insubstantial and inadvertent action that is remedied by the Company promptly
after receipt of notice of such change is given by you;

 

(ii)           a reduction by the
Company in your Base Pay, or a failure to provide a reasonably comparable bonus
program, or an adverse change in the form or timing of the payment thereof, as
in effect immediately prior to the Change in Control or as thereafter
increased;

 

(iii)          the failure by the
Company to cover you under Benefit Plans that, in the aggregate, provide
substantially similar benefits to you and/or your family and dependents at a
substantially similar total cost to you (e.g., premiums, deductibles, co-pays,
out of pocket maximums, required contributions and the like) relative to the
benefits and total costs under the Benefit Plans in which you were
participating at any time during the 90-day period immediately preceding the
Change in Control;

 

(iv)          the Company’s requiring
you to be based more than 30 miles from where your office is located immediately
prior to the Change in Control, except for required travel on the Company’s
business, and then only to the

 

5

 

extent
substantially consistent with the business travel obligations that you undertook
on behalf of the Company during the 90-day period immediately preceding the
Change in Control (without regard to travel related to or in anticipation of
the Change in Control);

 

(v)           the failure by the
Company to obtain from any Successor the assent to this Agreement contemplated
by Section 5 of this Agreement;

 

(vi)          any purported
termination by the Company of your employment that is not properly effected
pursuant to a Notice of Termination and pursuant to any other requirements of
this Agreement, and, for purposes of this Agreement, no such purported
termination will be effective; or

 

(vii)         any refusal by the
Company to continue to allow you to attend to matters or engage in activities
not directly related to the business of the Company which, at any time prior to
the Change in Control, you were not expressly prohibited in writing by the
Board from attending to or engaging in.

 

Your continued employment does not constitute consent to, or waiver of
any rights arising in connection with, any circumstances constituting Good
Reason.  Your termination of employment
for Good Reason as defined in this Section 1(m) will constitute Good Reason for
all purposes of this Agreement notwithstanding that you may also thereby be
deemed to have retired under any applicable retirement programs of the Company.

 

(m)          “Notice of
Termination” means a written notice given on or after the date of a Change
in Control (unless your termination before the date of the Change in Control
was either a condition of the Change in Control or was at the request or
insistence of any Person related to the Change in Control) which indicates the
specific termination provision in this Agreement pursuant to which the notice
is given.  Any purported termination by
the Company or by you for Good Reason on or after the date of a Change in
Control (or before the date of a Change in Control if your termination was
either a condition of the Change in Control or was at the request or insistence
of any Person related to the Change in Control) must be communicated by written
Notice of Termination to be effective; provided, that your failure to provide
Notice of Termination will not limit any of your rights under this Agreement
except to the extent the Company demonstrates that it suffered material actual
damages by reason of such failure.

 

(n)           “Parent Corporation”
means Angeion Corporation and any Successor.

 

(o)           “Person” means
any individual, corporation, partnership, group, association or other “person,”
as such term is used in Section 14(d) of the Exchange Act, other than

 

6

 

the Parent
Corporation, any Affiliate or any benefit plan(s) sponsored by the Parent
Corporation or an Affiliate.

 

(p)           “Successor”
means any Person that succeeds to, or has the practical ability to control
(either immediately or solely with the passage of time), the Parent
Corporation’s business directly, by merger, consolidation or other form of
business combination, or indirectly, by purchase of the Parent Corporation’s
outstanding securities ordinarily having the right to vote at the election of
directors or all or substantially all of its assets or otherwise.

 

2.             Term of Agreement.  This Agreement is effective immediately and
will continue in effect for the duration of your employment with the Company or
if a Change in Control has occurred during the term of this Agreement, for a
period of 24 months following the month during which the Change in Control
occurs or, if later, until the date on which the Company’s obligations to you
arising under or in connection with this Agreement have been satisfied in full.

 

3.             Benefits upon a
Change in Control Termination.  You
will become entitled to the benefits described in this Section 3 if and only if
(a) the Company terminates your employment for any reason other than your
death or Cause, or you terminate your employment with the Company for Good
Reason and (b) the termination occurs either within the period beginning
on the date of a Change in Control and ending on the last day of the 24th
month that begins after the month during which the Change in Control occurs or
prior to a Change in Control if your termination was either a condition of the
Change in Control or was at the request or insistence of a Person related to
the Change in Control.

 

(a)                                  Cash
Payment.  Within 10 business days
following the Date of Termination, or, if later, within 10 business days
following the date of the Change in Control, the Company will make a lump-sum
cash payment to you in an amount equal to your annual Base Pay.

 

(b)                                 Group
Health Plans.  During the
continuation period, the Company will maintain a group health plan(s) that by
its terms covers you (and your family members and dependents who were eligible
to be covered at any time during the 90-day period immediately prior to the
date of a Change in Control for the period after the Change in Control in which
such family members and dependents would otherwise continue to be covered under
the terms of the plan in effect immediately prior the Change in Control) under
the same terms and at the same cost to you and your family members and
dependents as similarly situated individuals who continue to be employed by the
Company (without regard to any reduction in such benefits that constitutes Good
Reason).  The continuation period under
applicable federal and state continuation laws will begin to run from the date
on which coverage pursuant

 

7

 

to this Section 3(b) ends.  The “continuation period” is the period beginning on your Date of
Termination and ending on the earlier of (i) the last day of the 12th month
that begins after your Date of Termination or (ii) the date after your Date of
Termination on which you first become eligible to participate as an employee in
a plan of another employer providing group health benefits to you and your
eligible family members and dependents which plan does not contain any
exclusion or limitation with respect to any pre-existing condition of you or
any eligible family member or dependent who would otherwise be covered under
the Company’s plan but for this clause (ii).

 

(c)                                  Out
Placement Assistance.  The Company
will pay up to five percent of your Base Pay for out placement counseling to
you.  Such payments will be made either
directly to the counselor or to you within 10 days after presentation of an
invoice for services rendered or to be rendered.

 

If, on or after the date of a Change in Control, an
Affiliate is sold, merged, transferred or in any other manner or for any other
reason ceases to be an Affiliate or all or any portion of the business or
assets of an Affiliate are sold, transferred or otherwise disposed of and the
acquiror is not the Parent Corporation or an Affiliate (a “Disposition”), and
you remain or become employed by the acquiror or an affiliate of the acquiror
(as defined in this Agreement but substituting “acquiror” for “Parent
Corporation”) in connection with the Disposition, you will be deemed to have
terminated employment on the effective date of the Disposition for purposes of
this Section 3 unless (x) the acquiror and its affiliates jointly and severally
expressly assume and agree, in a manner that is enforceable by you, to perform
the obligations of this Agreement to the same extent that the Company would be
required to perform if the Disposition had not occurred and (y) the Successor
guarantees, in a manner that is enforceable by you, payment and performance by
the acquiror.

 

4.             Indemnification.  Following a Change in Control, the Company
will indemnify and advance expenses to you to the full extent permitted by law
for damages, costs and expenses (including, without limitation, judgments,
fines, penalties, settlements and reasonable fees and expenses of your counsel)
incurred in connection with all matters, events and transactions relating to
your service to or status with the Company or any other corporation, employee
benefit plan or other entity with whom you served at the request of the
Company.

 

5.             Successors.  The Parent Corporation will seek to have any
Successor, by agreement in form and substance satisfactory to you, assent to
the fulfillment by the Company of the Company’s obligations under this
Agreement.  Failure of the Parent
Corporation to obtain such assent at least three business days prior to the
time a Person becomes a Successor (or where the Parent Corporation does not
have at least three business days’ advance notice that a Person may become a
Successor, within one business day after having notice that such Person may
become or has become a Successor) will constitute Good Reason for termination
by you of your employment. The date on which any such succession becomes
effective will

 

8

 

be deemed the Date
of Termination, and Notice of Termination will be deemed to have been given on
that date.  A Successor has no rights,
authority or power with respect to this Agreement prior to a Change in Control.

 

6.             Binding
Agreement.  This Agreement inures to
the benefit of, and is enforceable by, you, your personal and legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees.  If you die while any amount
would be still payable to you under this Agreement if you had continued to
live, all such amounts, unless otherwise provided in this Agreement, will be
paid in accordance with the terms of this Agreement to your devisee, legatee or
other designee or, if there be no such designee, to your estate.

 

7.             No
Mitigation.  You will not be
required to mitigate the amount of any benefits the Company becomes obligated
to provide to you in connection with this Agreement by seeking other employment
or otherwise.  The benefits to be
provided to you in connection with this Agreement may not be reduced, offset or
subject to recovery by the Company by any benefits you may receive from other
employment or otherwise.

 

8.             No
Setoff.  The Company has no right to
setoff benefits owed to you under this Agreement against amounts owed or
claimed to be owed by you to the Company under this Agreement or otherwise.

 

9.             Taxes.  All benefits to be provided to you in
connection with this Agreement will be subject to required withholding of
federal, state and local income, excise and employment-related taxes.

 

10.           Notices.  For the purposes of this Agreement, notices and
all other communications provided for in, or required under, this Agreement
must be in writing and will be deemed to have been duly given when personally
delivered or when mailed by United States registered or certified mail, return
receipt requested, postage prepaid and addressed to each party’s respective
address set forth on the first page of this Agreement (provided that all
notices to the Company must be directed to the attention of the chair of the
Board), or to such other address as either party may have furnished to the
other in writing in accordance with these provisions, except that notice of
change of address will be effective only upon receipt.

 

11.           Disputes.  If you so elect, any dispute, controversy or
claim arising under or in connection with this Agreement will be settled
exclusively by binding arbitration administered by the American Arbitration
Association in Minneapolis, Minnesota in accordance with the Commercial
Arbitration Rules of the American Arbitration Association then in effect.  Judgment may be entered on the arbitrator’s
award in any court having jurisdiction; provided, that you may seek specific
performance of your right to receive benefits until the Date of Termination
during the pendency of any dispute or controversy arising under or in
connection with this Agreement.  If any
dispute, controversy or claim for

 

9

 

damages arising under or in connection with this Agreement is settled
by arbitration, the Company will pay, or if elected by you, reimburse, all
fees, costs and expenses incurred by you related to such arbitration.  If you do not elect arbitration, you may
pursue all available legal remedies. 
The Company will pay, or if elected by you, reimburse you for, all fees,
costs and expenses incurred by you in connection with any actual, threatened or
contemplated litigation relating to this Agreement to which you are or
reasonably expect to become a party, whether or not initiated by you, if you
are successful in recovering any benefit under this Agreement as a result of
such action.  The parties agree that any
litigation arising under or in connection with this Agreement must be brought
in a court of competent jurisdiction in the State of Minnesota, and hereby
consent to the exclusive jurisdiction of said courts for this purpose and agree
not to assert that such courts are an inconvenient forum.  The Company will not assert in any dispute
or controversy with you arising under or in connection with this Agreement your
failure to exhaust administrative remedies.

 

12.           Related
Agreements.  To the extent that any
provision of any other Benefit Plan or agreement between the Company and you
limits, qualifies or is inconsistent with any provision of this Agreement, then
for purposes of this Agreement, while such other Benefit Plan or agreement
remains in force, the provision of this Agreement will control and such
provision of such other Benefit Plan or agreement will be deemed to have been
superseded, and to be of no force or effect, as if such other agreement had
been formally amended to the extent necessary to accomplish such purpose.  Nothing in this Agreement prevents or limits
your continuing or future participation in any Benefit Plan provided by the
Company and for which you may qualify, and nothing in this Agreement limits or
otherwise affects the rights you may have under any Benefit Plans or other
agreements with the Company.  Amounts
which are vested benefits or which you are otherwise entitled to receive under
any Benefit Plan or other agreement with the Company at or subsequent to the
Date of Termination will be payable in accordance with such Benefit Plan or
other agreement.

 

13.           No
Employment or Service Contract. 
Nothing in this Agreement is intended to provide you with any right to
continue in the employ of the Company for any period of specific duration or
interfere with or otherwise restrict in any way your rights or the rights of
the Company, which rights are hereby expressly reserved by each, to terminate
your employment at any time for any reason or no reason whatsoever, with or
without cause.

 

14.           Change
of Affiliate Status.  This Agreement
will become null and void if, prior to a Change in Control:  (a) an Affiliate is sold, merged,
transferred or in any other manner or for any other reason ceases to be an
Affiliate or all or any portion of the business or assets of an Affiliate are
sold, transferred or otherwise disposed of and no Change in Control occurs in
connection therewith;  (b) your
primary employment duties are with the Affiliate at the time of the occurrence
of such event; and (c) you do not, in conjunction therewith, transfer
employment directly to the Company.

 

10

 

15.           Funding
and Payment.  Benefits payable under
this Agreement will be paid only from the general assets of the Company.  No person has any right to or interest in
any specific assets of the Company by reason of this Agreement.  To the extent benefits under this Agreement
are not paid when due to any individual, he or she is a general unsecured
creditor of the Company with respect to any amounts due.

 

The Company with whom you were employed immediately before your Date of
Termination has primary responsibility for benefits to which you or any other
person are entitled pursuant to this Agreement but to the extent such Company
is unable or unwilling to provide such benefits, the Parent Corporation and
each other Affiliate are jointly and severally responsible therefor to the
extent permitted by applicable law.  If
you were simultaneously employed by more than one Company immediately before
your Date of Termination, each such Company has primary responsibility for a
portion of the benefits to which you or any other person are entitled pursuant
to this Agreement that bears the same ratio to the total benefits to which you
or such other person are entitled pursuant to this Agreement as your Base Pay
from the Company immediately before your Date of Termination bears to your
aggregate Base Pay from all such Companies.

 

16.           Survival.  The respective obligations of, and benefits
afforded to, the Company and you which by their express terms or clear intent
survive termination of your employment with the Company or termination of this
Agreement, as the case may be, will survive termination of your employment with
the Company or termination of this Agreement, as the case may be, and will
remain in full force and effect according to their terms.

 

17.           Miscellaneous.  No provision of this Agreement may be
modified, waived or discharged unless such modification, waiver or discharge is
agreed to in a writing signed by you and the chair of the Board.  No waiver by any party to this Agreement at
any time of any breach by another party to this Agreement of, or of compliance
with, any condition or provision of this Agreement to be performed by such
party will be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time.  No agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter of this Agreement have been made by
any party which are not expressly set forth in this Agreement.  This Agreement and the legal relations among
the parties as to all matters, including, without limitation, matters of
validity, interpretation, construction, performance and remedies, will be
governed by and construed exclusively in accordance with the internal laws of
the State of Minnesota (without regard to the conflict of laws principles of
any jurisdiction).  Headings are for
purposes of convenience only and do not constitute a part of this
Agreement.  The parties to this
Agreement agree to perform, or cause to be performed, such further acts and
deeds and to execute and deliver or cause to be executed and delivered, such
additional or supplemental documents or instruments as may be reasonably
required by the other party to carry into effect the intent and purpose of this
Agreement.  The invalidity or
unenforceability of all or any part of any provision of this

 

11

 

Agreement will not affect the validity or enforceability of the
remainder of such provision or of any other provision of this Agreement, which
will remain in full force and effect. 
This Agreement may be executed in several counterparts, each of which
will be deemed to be an original, but all of which together will constitute one
and the same instrument.

 

If this letter correctly sets forth our agreement on the subject matter
discussed above, kindly sign and return to the Company the enclosed copy of
this letter which will then constitute our agreement on this subject.

 

	
  Sincerely,

  
	
   

  
	
  ANGEION CORPORATION

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Arnold Angeloni

  	
   

  
	
  Arnold Angeloni.

  
	
  Chairman

  
	
   

  
	
   

  
	
  Agreed to as of this 7th day of July,
  2004

  
	
   

  
	
   

  
	
  /s/ Rodney A. Young

  	
   

  
	
  Rodney A. Young

  
				

 

12

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