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                                                                   Exhibit 10.21

                                QIC Holding Corp.

                         2002 Management Incentive Plan

PLAN OBJECTIVES

Quinton's future depends upon building and maintaining a high-performance
culture. We want our employees to be actively engaged in seeking
customer-focused solutions to grow the business and boost profitability.

All participating managers make decisions that affect Quinton's revenues, costs,
and use of assets. The Management Incentive Plan endeavors to encourage your
commitment to think and act like owners of the business--and take a direct stake
in that success. The objectives include:

         -    Encouraging focus on specific performance objectives.

         -    Rewarding participants annually based on overall Company
              performance.

         -    Sharing in Quinton's financial success.

SCOPE & ELIGIBILITY

The Quinton Management Incentive Plan is available to Quinton management
employees, subject to certain eligibility requirements and qualifications.

Regular, full-time members of management, and those working part-time holding a
position with significant management responsibility, are eligible to participate
in the Plan, if actively employed by June 30th and if actively employed through
December 31st of the Plan Year.

Eligible participants may be deemed actively employed for purposes of this Plan
if as of December 31st the participant is on an approved leave of absence,
retires during the Plan Year after attaining age 55 and ten years of service, or
deceased during the Plan Year.

Sales Management employees participating in a commission or sales bonus plan are
excluded from participation in this Plan.

POLICY

The Management Incentive Plan is adopted and effective January 1, 2002.

The Plan Year for the Management Incentive Plan is the calendar year.

The Plan is a cash only incentive compensation plan. The amount of cash
incentive available for distribution in any given year is entirely
discretionary, and subject to achievement of certain profitability goals.

The Plan is designed to encourage active participation in attainment of Company
goals. While the Plan assumes that achieving operating profit is the primary
measure of attainment, it also recognizes that participants in this Plan
contribute to profit by superior performance in the design, production and
delivery of quality products within planned schedules, and through controlling
expenses.

PLAN NOT A CONTRACT

The Quinton Management Incentive Plan is not intended to create any contractual
rights between any employee and the Company. The Company reserves the right to
declare any employee ineligible for a distribution under this Plan at any time.
Such disqualification, for example, may be for reasons of poor performance. This
Plan is entirely discretionary, both with respect to participants who receive a
benefit under this Plan and as to the total amount available for distribution
among eligible participants.
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INCENTIVE PLAN CRITERIA & PROCEDURE

During the calendar year ending December 31, 2002, the Company will record an
accrual for the Management Incentive Plan. The amount accrued for incentives may
be up to twenty percent (20%) of the net positive EBITDA for the quarter. EBITDA
is defined as EBIT plus depreciation, amortization of intangible assets,
amortization of deferred stock compensation expenses, and certain extraordinary
legal expenses. EBITDA will be computed prior to the inclusion of any amounts
accrued for the Management Incentive Plan.

Incentive payments, if any, will be paid in 2003, after the conclusion of the
audit of financial statements for the year ending December 31, 2002. The audited
financial statements will be used to assure the reasonableness of any EBITDA
amount used in computing accrued bonuses. If the audit is not completed by March
31, 2003, however, the incentive, if any, will be paid during the following
month.

Any Management Incentive Plan bonus distributions shall be subject to approval
by the Board of Directors.

The total amount available for distribution among eligible participants shall be
allocated to each Department Head as a percentage of the Basic Earnings of all
eligible participants within the Department. Basic Earnings consist of salary
paid during the Plan Year (including, holiday, vacation and sick leave pay), but
excludes other premium or bonus payments or payments received under any
disability or worker's compensation plan.

The specific dollar amount of cash incentive allocated to each eligible
participant shall be based on the recommendation of the Department Head and
approved by the President. Each recommendation will be based on an assessment of
the participant's individual contribution toward the attainment of Company
goals.

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                                                                   Exhibit 10.22

                           QUINTON INSTRUMENT COMPANY
                            3303 Monte Villa Parkway
                            Bothell, Washington 98021

June 7, 1999

Mr. Mark R. Tauscher
22421 N.E. 140th Way
Woodinville, Washington 98072

Dear Mark:

This letter sets forth the substance of the separation agreement ("Agreement")
that Quinton Instrument Company ("Company") is offering you to aid in your
employment transition.

         1. SEPARATION. Your last day as an employee, officer and director of
the Company will be June 8, 1999 ("Separation Date"), pursuant to the letter of
resignation (Exhibit A hereto) which you will execute by that date.

         2. ACCRUED SALARY AND VACATION. On the Separation Date, the Company
will pay you all accrued salary, and all accrued and unused vacation totaling
twenty (20) days, earned through the Separation Date, subject to standard
payroll deductions and withholdings. You are entitled to these payments whether
or not you sign this Agreement.

         3. SEVERANCE PAYMENT. Within five business days of the Effective Date
(defined in Paragraph 8 below), the Company will pay you, in lump sum, your base
salary from June 9, 1999 to and including September 3, 1999, subject to standard
payroll deductions and withholdings. You acknowledge and agree that as a result
of the payment that is the subject of this Paragraph 3, the Company will have
satisfied all of its obligations as set forth in Paragraph 2 of that certain
offer letter dated September 3, 1998 from QIC Holdings Corp. to you ("Offer
Letter") and you will have no other rights to salary, bonuses, benefits or other
compensation after the Separation Date.
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March 27, 2002
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         4. STOCK OPTION CANCELLATION; STOCK GRANT.

                  (a) You hereby agree to the cancellation of all stock options
granted to you by the Company under the QIC Holding Corp. 1998 Equity Incentive
Plan or otherwise (collectively, the "Option"), and you agree that all of your
rights and the Company's obligations under the Option are hereby extinguished
and the Option shall not be of any further force or effect. You further agree to
surrender to the Company for cancellation prior to the Effective Date all
documents evidencing the grant of the Option.

                  (b) As soon as practicable after the Effective Date but not
earlier than the date of surrender of documents evidencing the grant of the
Option, as provided in Paragraph 4(a), the Company shall issue you 30,000 shares
of the Company's common stock under the terms of the QIC Holding Corp. 1998
Equity Incentive Plan.

         5. HEALTH INSURANCE. To the extent permitted by the federal COBRA law
and by the Company's current group health insurance policies, you will be
eligible to continue your health insurance benefits at your own expense and, if
provided under such policies, later to convert to an individual policy if you
wish. You will be provided with a separate notice of your COBRA rights. If you
elect continued coverage under COBRA, the Company, as part of this Agreement,
will pay 100% of your COBRA premiums at current levels until your coverage
commences under new employment or the termination of the Consulting Engagement
(defined below), whichever occurs first.

         6. CONSULTING ENGAGEMENT. You will serve as a consultant to the Company
under the terms specified below ("Consulting Engagement"). The Consulting
Engagement will commence on the fifth business day after the Effective Date
("Commencement Date"), but in no event earlier than June 15, 1999, and continue
for one year from the Commencement Date ("Consulting Period"), unless earlier
terminated as set forth below:

                  (a) CONSULTING SERVICES. You agree to provide consulting
services to the Company in any area of your expertise upon request by the
President of the Company. During the Consulting Period, you will report directly
to the President, or as otherwise specified by the President. You agree to
exercise the highest degree of professionalism and utilize your expertise and
creative talents in performing these
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March 27, 2002
Page 3

services. Except for the periods June 15, 1999 - July 20, 1999 and December 15,
1999 - January 5, 2000, you agree to make yourself available to perform such
consulting services throughout the Consulting Period, up to a maximum of 40
hours per month; provided, however, that overnight travel will not be required
except by your and the Company's mutual agreement.

                  (b) CONSULTING FEES. During the Consulting Period, you will
receive $12,500 per month ("Consulting Fees"), payable in biweekly installments
on the Company's normal payroll dates. If you obtain regular employment during
the Consulting Period, or if you engage in any activity that is competitive with
the Company during the Consulting Period, the Consulting Engagement shall
terminate immediately, and the Company shall have no further payment obligations
under this Agreement; provided, however, that your engagement as a consultant to
a person or entity that does not compete or seek to compete with the Company is
permissible under this Agreement. You agree to notify the Company immediately,
in writing, upon your acceptance of such employment or engagement in such
competitive activity.

                  (c) NO TAX WITHHOLDINGS. Because your relationship with the
Company will be as a consultant, the Company will not withhold from the
Consulting Fees any amount for taxes, social security or other payroll
deductions. The Company will issue you a Form 1099 with respect to your
Consulting Fees. You acknowledge that you will be entirely responsible for
payment of any such taxes, and you hereby indemnify and save harmless the
Company from any liability for any taxes, penalties or interest that may be
assessed by any taxing authority with respect to Consulting Fees.

                  (d) LIMITATIONS ON AUTHORITY. You will have no
responsibilities or authority as a consultant to the Company other than as
provided above. You agree not to represent or purport to represent the Company
in any manner whatsoever to any third party unless authorized by the Company, in
writing, to do so.

                  (e) REIMBURSEMENT OF EXPENSES. Pursuant to its regular
business practice, the Company will reimburse you for documented business
expenses incurred during the Consulting Period, provided that these expenses
have been pre-approved by the President or CFO in writing or are expenses which
the Company would reasonably expect you to incur in carrying out Consulting
Services when requested.
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March 27, 2002
Page 4

         7. RELEASE OF CLAIMS. In exchange for the payments and other
consideration under this Agreement to which you would not otherwise be entitled,
you hereby release, acquit and forever discharge the Company, its affiliates,
and its and their officers, directors, employees, shareholders and agents, of
and from any and all claims, liabilities, demands, causes of action, costs,
expenses, attorneys' fees, damages, indemnities and obligations of every kind
and nature, in law, equity or otherwise, known and unknown, suspected and
unsuspected, disclosed and undisclosed, arising out of or in any way related to
agreements, events, acts or conduct at any time prior to and including the date
you execute this Agreement, including (but not limited to): all claims and
demands directly or indirectly arising out of or in any way connected with the
Offer Letter, your employment with the Company or the termination of your
employment; all claims or demands related to salary, bonuses, stock, stock
options, or any other ownership interests in the Company, vacation pay, fringe
benefits, severance benefits, or any other form of compensation; and all claims
and demands pursuant to any federal, state or local law, including (but not
limited to) the federal Civil Rights Act of 1964, as amended, the federal Age
Discrimination in Employment Act of 1967, as amended ("ADEA"), the federal
Americans with Disabilities Act of 1990, the Washington Law Against
Discrimination in Employment, tort law and contract law, including (without
limitation) claims for wrongful discharge, discrimination, fraud, defamation,
harassment, emotional distress, and breach of the implied covenant of good faith
and fair dealing; provided, however, that the foregoing release of claims shall
not apply to any right of indemnification that you may have pursuant to the
Bylaws of the Company as a consequence of your service as an officer, director
or employee of the Company.

         8. ADEA WAIVER. You acknowledge that you are knowingly and voluntarily
waiving and releasing any rights you may have under the ADEA. You also
acknowledge that the consideration given for the waiver and release in the
preceding Paragraph is in addition to anything of value to which you were
already entitled. You further acknowledge that you have been advised by this
writing, as required by the ADEA, that: (a) your waiver and release do not apply
to any rights or claims that may arise after the execution date of this
Agreement; (b) you should consult with an attorney prior to executing this
Agreement; (c) you have twenty-one (21) days to consider this Agreement
(although you may choose to voluntarily execute this Agreement earlier); (d) you
have seven (7) days following your execution of this Agreement to revoke the
Agreement; and (e) this Agreement will not be effective until
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March 27, 2002
Page 5

the date upon which the revocation period has expired, which will be the eighth
day after this Agreement is executed by you ("Effective Date").

         9. RETURN OF COMPANY PROPERTY. On the Separation Date, you agree to
return to the Company all Company documents (and all copies thereof) and other
Company property that you have in your possession or control, including, but not
limited to, Company files, notes, drawings, records, business plans and
forecasts, financial information, specifications, training materials,
computer-recorded information, tangible property including, but not limited to,
computers, credit cards, entry cards, identification badges and keys, and any
materials of any kind that contain or embody any proprietary or confidential
information of the Company (and all reproductions thereof). You may retain such
documents, property and materials during the Consulting Period only to the
extent approved in writing by the Company and you shall return them immediately
upon written request from the Company.

         10. PROPRIETARY INFORMATION OBLIGATIONS. You acknowledge your
continuing obligations under your Non-Disclosure Agreement (Exhibit B hereto)
both during and after your employment with the Company and the Consulting
Period. You agree not to use or disclose any confidential or proprietary
information of the Company without prior written authorization from a duly
authorized representative of the Company.

         11. NONSOLICITATION. You agree that for one year following the
Separation Date you will not, either directly or indirectly, solicit or attempt
to solicit any employee, consultant, independent contractor or customer of the
Company to terminate his or her relationship with the Company in order to become
an employee, consultant, independent contractor or customer of or to any other
person or entity; provided, however, that the prohibition in this Paragraph 11
against your solicitation of customers of the Company shall be in effect only
for so long as the Company pays you Consulting Fees under this Agreement.

         12. COMMUNICATIONS.

                  (a) You and the Company agree that the content of any
announcement regarding your separation shall be substantially as follows:

                  "For professional and personal reasons, Quinton Instrument
                  Company and Mark Tauscher have decided to go their separate
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March 27, 2002
Page 6

                  ways. Each wishes the other the best in all their future
                  endeavors."

                  (b) The Company agrees that upon your request, the Company
will provide a mutually agreed upon verbal or written recommendation to your
prospective employers.

                  (c) Both you and the Company agree not to disparage the other
party, and the other party's officers, directors, employees, shareholders,
affiliates and agents, in any manner likely to be harmful to them or their
business, business reputation or personal reputation; provided that both you and
the Company shall respond accurately and fully to any question, inquiry or
request for information when required by legal process.

         13. CONFIDENTIALITY. The provisions of this Agreement will be held in
strictest confidence by you and the Company and will not be publicized or
disclosed in any manner whatsoever, provided, however, that: (a) you may
disclose this Agreement to your immediate family, attorney, accountant and
financial advisor, and as necessary in seeking consulting work or employment;
(b) the Company may disclose this Agreement as may be necessary in the conduct
of its business; and (c) the parties may disclose this Agreement as may be
necessary to enforce its terms or as otherwise required by law. In particular,
and without limitation, you will not disclose the provisions of this Agreement
to any current or former employee of the Company, except as required by law.

         14. MISCELLANEOUS. This Agreement represents a compromise resolution of
disputed claims, and the promises and payments in consideration of this
Agreement shall not be construed to be an admission of any liability or
obligation by either party to the other party or to any other person. This
Agreement, including Exhibits A and B, constitutes the complete, final and
exclusive embodiment of the entire agreement between you and the Company with
regard to the subject matter hereof and supersedes any and all other agreements
entered into by and between you and the Company. This Agreement is entered into
without reliance on any promise or representation, written or oral, other than
those expressly contained herein. Each party has carefully read this Agreement,
has been afforded the opportunity to be advised of its meaning and consequences
by his or its respective attorney, and signed the same of his or its own free
will. This Agreement will bind the heirs, personal representatives, successors
and
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March 27, 2002
Page 7

assigns of each party, and inure to the benefit of each party, its heirs,
personal representatives, successors and assigns. This Agreement may not be
modified except in a writing signed by you and a duly authorized officer of the
Company.

If this Agreement is acceptable to you, please so indicate by countersigning the
enclosed copy of this letter and returning it to me.

I wish you luck in your future endeavors.

Sincerely,

QUINTON INSTRUMENT COMPANY

By /s/ Quinton Instrument Company
   ----------------------------------

Exhibit A - Letter of Resignation
Exhibit B - Non-Disclosure Agreement

UNDERSTOOD AND AGREED:

 /s/ MARK R. TAUSCHER
-------------------------------------
MARK R. TAUSCHER

Date:  June 8, 1999

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