Document:

EXHIBIT 10.1

FIRST
AMENDMENT

TO

LOAN AND SECURITY AGREEMENT

THIS FIRST AMENDMENT
to Loan and Security Agreement (this  “Amendment”)
is entered into this 15th day of March, 2007, by and between SILICON VALLEY BANK (“Bank”), on the one side, and EV3 ENDOVASCULAR, INC., a Delaware corporation, EV3 INTERNATIONAL, INC., a Delaware corporation, and MICRO THERAPEUTICS, INC., a Delaware corporation
(collectively and jointly and severally referred to as “Borrowers”),
whose address is c/o ev3 Inc., 9600 54th Avenue North, Plymouth, MN  55442, on the other side.

RECITALS

A.            Bank and Borrowers have entered into that certain Loan
and Security Agreement dated with an Effective Date of June 28, 2006 (as the
same may from time to time be further amended, modified, supplemented or
restated, the “Loan Agreement”).  The
Obligations of the Borrowers have been guarantied by, among others, the
following companies, in favor of Bank: ev3 Inc., a Delaware corporation; Micro
Therapeutics International, Inc., a Delaware corporation; ev3 Technologies,
Inc., a Delaware corporation; EndiCOR Medical, Incorporated, a Delaware
corporation; ev3 Peripheral, Inc., a Minnesota corporation; ev3 Sunnyvale,
Inc., a California corporation; and ev3 Santa Rosa, Inc., a California
corporation.

B.            Bank has extended credit to Borrowers for the purposes
permitted in the Loan Agreement.

C.            Borrowers have requested that Bank amend the Loan
Agreement to (i) provide for $5,000,000 of additional equipment advances,
and (ii) make certain other revisions to the Loan Agreement as more fully
set forth herein.

D.            Bank has agreed to so amend certain provisions of the
Loan Agreement, but only to the extent, in accordance with the terms, subject
to the conditions and in reliance upon the representations and warranties set
forth below.

AGREEMENT

NOW, THEREFORE,
in consideration of the foregoing recitals and other good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged, and
intending to be legally bound, the parties hereto agree as follows:

1.             Definitions.  Capitalized terms used but not defined in
this Amendment shall have the meanings given to them in the Loan Agreement.

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2.             Amendments to Loan Agreement.

2.1          Section 2.1.8 (Equipment B Advances).  Section 2.1.8 of the Loan Agreement is hereby
amended to read as follows:

2.1.8                     Equipment
B Advances.

(a)           Availability.  Subject to the terms and conditions of this
Agreement, and provided that no Default or Event of Default then exists, Bank
shall make an advance (the “Equipment B Advance”) not exceeding the Equipment
Line B.

(i)            Equipment B Advance.  Promptly after the execution and delivery of
the First Amendment by the parties thereto, Borrowers shall deliver to Bank
(the “Initial Equipment B Invoice Delivery”) copies of invoices for Eligible
Equipment purchased by Borrowers during the period (the “Equipment B Advance
Purchase Period”) from March 14, 2006 through August 31, 2007 (determined based
upon the applicable invoice date of such Eligible Equipment), that was not
financed pursuant to Section 2.1.5 of this Agreement, the Eligible Equipment
Invoice Amounts of which total at least $1,000,000, and thereafter Bank shall
make an Equipment B Advance to Borrower in an amount equal to
$5,000,000.  After such Equipment B
Advance, Borrowers shall deliver to Bank copies of all invoices for Eligible
Equipment to be financed by such Equipment B Advance that is purchased by
Borrowers from time to time during the Equipment B Advance Purchase Period but
after the Initial Equipment B Invoice Delivery. 
If on August 31, 2007 an Excess Equipment B Advance exists, then
Borrowers shall immediately pay the amount of such excess to Bank.

(b)           Repayment.  The Equipment B Advance shall be repaid by
the Borrowers to Bank in 42 equal monthly payments of principal, commencing on
the last day of the seventh month following the date the Equipment B Advance
was made and continuing on the last day of each month thereafter until the last
day of the 48th month following the date the Equipment B
Advance was made, on which date the entire unpaid principal balance of the
Equipment B Advance, plus all accrued and unpaid interest thereon, shall be due
and payable.  Borrowers may prepay the
Equipment B Advance (in addition to any payments made in accordance with
Section 2.19) in whole or part at 

 2
 

any time by written
notice to Bank without premium, penalty or charge whatsoever.  Any principal prepayment of the Equipment B
Advance shall be applied to the principal payments due on the Equipment B
Advance in the inverse order of maturity. 
The Equipment B Advance may not be repaid and re-borrowed

2.2          Sections 2.1.5(c) and 2.1.9
(Prepayment Upon Event of Loss).  Section 2.1.5(c) of the Loan Agreement is
hereby deleted; references to “Section 2.1.5.(c)” contained in this Agreement
are hereby amended to read “Section 2.1.9; and a new Section 2.1.9 is hereby
added to the Loan Agreement to read as follows:

2.1.9       Prepayment
Upon an Event of Loss. 
Borrowers shall bear the risk of any loss, theft, destruction, or damage
of or to the Financed Equipment.  If,
during the term of this Agreement, any item of Financed Equipment becomes
obsolete or is lost, stolen, destroyed, damaged beyond repair, rendered
permanently unfit for use, or seized by a governmental authority for any reason
for a period equal to at least the remainder of the term of any Equipment
Advance or Equipment B Advance that financed such Financed Equipment (an “Event of Loss”), then, within ten (10) days following the
later of (i) the date of such Event of Loss or (ii) the settlement of any
insurance claim relating thereto, but not later than one hundred ten (110) days
following the Event of Loss, Borrowers shall either (i) pay to Bank on account
of the Obligations all outstanding principal that had been advanced with
respect to the Financed Equipment subject to the Event of Loss, plus all
accrued interest relating to such principal; or, if no Event of Default has
occurred and is continuing, at Borrowers’ option,  (ii) repair or replace any Financed Equipment
subject to the Event of Loss provided (x) the repaired or replaced Financed
Equipment is of equal or like value to the Financed Equipment subject to an
Event of Loss, (y) Bank has a first priority perfected security interest in
such repaired or replaced Financed Equipment, and (z) the Borrowers shall be
subject to any limit on the use of insurance proceeds contained in this
Agreement.  Principal prepayments
pursuant to this subsection shall be applied to the principal payments due on
the Equipment Advances or Equipment B Advance (as applicable) in the inverse
order of maturity.

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2.3          Section 2.3 (Payment of
Interest).  Section
2.3(a)(ii) of the Loan Agreement reads as follows:

(ii)           Equipment Advances.  Subject to Section 2.3(b), the principal
amount outstanding for each Equipment Advance shall accrue interest at a
floating per annum rate equal to one (1.0) percentage point above the Prime
Rate, which interest shall be payable monthly.

Said Section 2.3(a)(ii)
is hereby amended to read as follows:

(ii)           Equipment Advances and Equipment B
Advances.  Subject to Section 2.3(b),
the principal amount outstanding for each Equipment Advance and the Equipment B
Advance shall accrue interest at a floating per annum rate equal to one (1.0)
percentage point above the Prime Rate, which interest shall be payable monthly.

2.4          Section 3.4(b) (Equipment and
Equipment B Advances). 
Section 3.4(b) of the Loan Agreement is hereby amended to read as
follows:

(b)           Equipment and Equipment B Advances.  Subject to the prior satisfaction of all
other applicable conditions to the making of an Equipment Advance or an
Equipment B Advance set forth in this Agreement, to obtain an Equipment Advance
or an Equipment B Advance, Borrowers must notify Bank (which notice shall be
irrevocable) by electronic mail or facsimile no later than 12:00 p.m. Pacific
time one (1) Business Day before the proposed Funding Date.  The notice shall be a Payment/Advance Form,
must be signed by a Responsible Officer of each Borrower or designee, and
(except as otherwise provided in Section 2.1.5(a)(i) with respect to the
Qualifying Initial Equipment Advance or in Section 2.1.8(a)(i) with
respect to the Initial Equipment B Advance) shall include a copy of the
invoice(s) for the Equipment being financed. 
If Borrowers satisfy the conditions of each Equipment Advance or
Equipment B Advance (as applicable), Bank shall disburse such Equipment Advance
or Equipment B Advance (as applicable) by transfer to the Designated Deposit
Account.

2.5          Section 13.1 (New Definitions).  The following definitions are hereby added to
Section 13.1 of the Loan Agreement, in the appropriate alphabetical order:

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2.1.5  “Eligible
Equipment Invoice Amount” is defined in Section 2.1.5(a)(3).

“Equipment B Advance”  is defined in Section 2.1.8(a).

“Equipment B Advance
Purchase Period”  is defined in
Section 2.1.8(a)(i).

 “Equipment Line B”  is an
Equipment B Advance of $5,000,000.

“Excess Equipment B Advance”
is the amount, if any, by which the outstanding amount of the Equipment B
Advance exceeds the aggregate Eligible Equipment Invoice Amounts for which
Borrowers have delivered invoices to Bank for purchases of Eligible Equipment
made during the Equipment B Advance Purchase Period that are to be financed by
the Equipment B Advance.

“First Amendment”  means the First Amendment to Loan and Security Agreement,
dated March 15, 2007, among Bank and Borrowers.

 “Initial
Equipment B Invoice Delivery” is defined in Section
2.1.8(a)(i).

2.6          Section 13.1 (Amendments to
Existing Definitions).  The
definitions for the following defined terms from Section 13.1 of the Loan
Agreement are hereby amended to read as set forth below:

“Credit
Extension” is any Advance, Equipment Advance, Equipment B Advance,
Letter of Credit, FX Forward Contract, amount utilized for Cash Management
Services, or any other extension of credit by Bank for any Borrower’s benefit.

“Financed
Equipment” is all present and future Eligible Equipment in which any
Borrower has any interest, the purchase of which is financed by an Equipment
Advance or the Equipment B Advance.

3.             Limitation
of Amendments.

3.1          The amendments set
forth in Section 2, above, are effective
for the purposes set forth herein and shall be limited precisely as written and
shall not be deemed to (a) be a consent to any amendment, waiver or
modification of any other term or 

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condition of any Loan
Document, or (b) otherwise prejudice any right or remedy which Bank may
now have or may have in the future under or in connection with any Loan
Document.

3.2          This Amendment shall
be construed in connection with and as part of the Loan Documents and all
terms, conditions, representations, warranties, covenants and agreements set
forth in the Loan Documents, except as herein amended, are hereby ratified and
confirmed, shall remain in full force and effect, and are incorporated herein
by reference.

4.             Representations
and Warranties.  To
induce Bank to enter into this Amendment, each Borrower hereby represents and
warrants to Bank as follows:

4.1          Immediately after
giving effect to this Amendment (a) the representations and warranties contained
in the Loan Documents are true, accurate and complete in all material respects
as of the date hereof (except (i) to the extent such representations and
warranties relate to an earlier date, in which case they are true and correct
as of such date, and (ii) the representations in Sections 5.2 and 5.4 of the
Loan Agreement shall refer, respectively, to Schedules 5.2 and 5.4 attached
hereto), and (b) no Event of Default has occurred and is continuing;

4.2          Borrower has the
power and authority to execute and deliver this Amendment and to perform its
obligations under the Loan Agreement, as amended by this Amendment;

4.3          The organizational
documents of Borrower previously delivered to Bank remain true, accurate and
complete and have not been amended, supplemented or restated and are and
continue to be in full force and effect;

4.4          The execution and
delivery by Borrower of this Amendment and the performance by Borrower of its
obligations under the Loan Agreement, as amended by this Amendment, have been
duly authorized;

4.5          The execution and
delivery by Borrower of this Amendment and the performance by Borrower of its
obligations under the Loan Agreement, as amended by this Amendment, do not and
will not contravene (a) any law or regulation binding on or affecting
Borrower, (b) any contractual restriction with a Person binding on
Borrower, (c) any order, judgment or decree of any court or other
governmental or public body or authority, or subdivision thereof, binding on
Borrower, or (d) the organizational documents of Borrower;

4.6          The execution and
delivery by Borrower of this Amendment and the performance by Borrower of its
obligations under the Loan Agreement, as amended by this Amendment, do not
require any order, consent, approval, license, authorization or validation of,
or filing, recording or registration with, or exemption by any governmental or
public body or authority, or subdivision thereof, binding on either Borrower,
except as already has been obtained or made; and

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4.7          This Amendment has
been duly executed and delivered by Borrower and is the binding obligation of
Borrower, enforceable against Borrower in accordance with its terms, except as
such enforceability may be limited by bankruptcy, insolvency, reorganization,
liquidation, moratorium or other similar laws of general application and
equitable principles relating to or affecting creditors’ rights.

4.8          Ev3 Santa Rosa, Inc.
was merged into ev3 International, Inc., with ev3 International, Inc. being the
surviving corporation.

4.9          Each of EndiCOR Medical,
Incorporated, ev3 Technologies, Inc. and ev3 Sunnyvale, Inc. was merged into
ev3 Peripheral, Inc., with ev3 Peripheral, Inc. being the surviving
corporation.

5.             Counterparts.  This Amendment may be executed in any number
of counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.

6.             Effectiveness.  This Amendment shall be deemed effective upon
(a) the due execution and delivery of this Amendment by each party hereto, and
(b) Bank’s receipt of the Acknowledgment of Amendment and Reaffirmation of
Guaranty substantially in the form attached hereto as Schedule 1, duly executed
and delivered by each Guarantor.

IN WITNESS WHEREOF,
the parties hereto have caused this Amendment to be duly executed and
delivered as of the date first written above.

BORROWERS:

	
  EV3 ENDOVASCULAR, INC.

  	
   

  	
  EV3 INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By

  	
    /s/ Patrick D. Spangler

  	
   

  	
  By

  	
    /s/ Patrick
  D. Spangler

  
	
  Name:

  	
    Patrick D. Spangler

  	
   

  	
  Name:

  	
    Patrick D.
  Spangler

  
	
  Title:

  	
    Chief Financial Officer

  	
   

  	
  Title:

  	
    Treasurer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  MICRO
  THERAPEUTICS, INC.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By

  	
    /s/ Patrick D. Spangler

  	
   

  	
   

  	
   

  
	
  Name: 

  	
    Patrick D. Spangler

  	
   

  	
   

  	
   

  
	
  Title:

  	
    Treasurer and Chief Financial Officer

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BANK:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SILICON
  VALLEY BANK

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By

  	
    /s/ Jay McNeil

  	
   

  	
   

  	
   

  
	
  Name:

  	
    Jay McNeil

  	
   

  	
   

  	
   

  
	
  Title:

  	
  Senior
  Relationship Manager

  	
   

  	
   

  	
   

  
							

 

 7

SCHEDULE
1

ACKNOWLEDGMENT
OF AMENDMENT

AND REAFFIRMATION OF GUARANTY

March 15, 2007

Silicon Valley Bank

301 Carlson Parkway, Suite 255

Minnetonka, MN  55305

Attn:  Jay McNeil

Re:        Silicon Valley Bank/ev3
Inc.

Gentlemen:

Reference is made to (i) the Loan and Security
Agreement (the “Loan Agreement”), dated June 28, 2006, between Silicon Valley
Bank (“Bank”), on the one side, and ev3 Endovascular, Inc., ev3 International,
Inc., and Micro Therapeutics, Inc. (collectively, the “Borrowers”), on the
other side, and (ii) the First Amendment to Loan and Security Agreement (the “Amendment”),
of substantially even date, between Bank and Borrowers.  (Capitalized terms used but not defined
herein shall have the meanings given to them in the Loan Agreement.)

By our signatures below, the undersigned agree as
follows:

Section  1.              Each undersigned guarantor hereby
acknowledges and confirms that it has reviewed and approved the terms and
conditions of the Amendment.

Section  2.              Each guarantor hereby consents to
the Amendment and agrees that the guaranty relating to the Obligations of
Borrowers under the Loan Agreement shall continue in full force and effect,
shall be valid and enforceable and shall not be impaired or otherwise affected
by the execution of the Amendment or any other document or instrument delivered
in connection herewith.

Section  3.              Each guarantor represents and
warrants that, after giving effect to the Amendment, all representations and
warranties contained in the guaranty are true, accurate and complete as if made
the date hereof.

Section 4.              This agreement may be executed in
any number of counterparts and all such counterparts taken together shall be
deemed to constitute one and the same instrument.  This agreement and the guaranty constitute
and contain the entire agreement of the parties and supersede any and all prior
and contemporaneous agreements, negotiations, correspondence, understandings
and communications between the 

 8
 

undersigned and Bank,
whether written or oral, respecting the subject matter hereof.  This agreement shall be construed in
connection with and as a part of the guaranty and the terms of the guaranty are
incorporated herein.

GUARANTOR

	
  ev3 Endovascular Inc

  	
   

  	
  ev3 Peripheral, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By

  	
    /s/ Patrick D. Spangler

  	
   

  	
  By

  	
    /s/ Patrick D. Spangler

  
	
  Name:

  	
    Patrick D. Spangler

  	
   

  	
  Name:

  	
    Patrick D.
  Spangler

  
	
  Title:

  	
    Chief Financial Officer

  	
   

  	
  Title:

  	
    Treasurer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Micro
  Therapeutics International, Inc.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By

  	
    /s/ Patrick D. Spangler

  	
   

  	
   

  	
   

  
	
  Name: 

  	
    Patrick D. Spangler

  	
   

  	
   

  	
   

  
	
  Title:

  	
    Treasurer and Chief Financial Officer

  	
   

  	
   

  	
   

  
							

 

 9Exhibit
10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (“Agreement”) is
made as of the 19th day of March, 2007, by and between ATS Corporation, a
Delaware corporation (the “Corporation”), and Dr. Edward H. Bersoff, a
resident of the Commonwealth of Virginia (the “Executive”).

WHEREAS, the Executive commenced service as the
Corporation’s Chairman, President and Chief Executive Officer on January 16,
2007, the date of the closing of the Corporation’s acquisition of Advanced
Technology Systems, Inc. (“ATS”);

WHEREAS, due to the Corporation’s stock repurchase
program and other factors, the Corporation’s financial position and other
circumstances following the acquisition of ATS are different from those
contemplated in the spring of 2006 when the Executive and the Corporation
initially agreed to proposed terms of employment effective upon the acquisition
of ATS;

WHEREAS, due to these different circumstances the
Executive and the Corporation desire to modify the terms of employment
generally agreed to in the spring of 2006; and

WHEREAS, the Executive and the Corporation wish to
formalize the modified terms of the employment relationship;

NOW, THEREFORE, in consideration of the premises and
the mutual agreements made herein, and intending to be legally bound hereby,
the Corporation and the Executive agree as follows:

1.             Employment;
Duties.

(a)           Employment and Employment Period.  The Corporation shall employ the Executive to
serve as the Corporation’s Chairman and Chief Executive Officer (initially also
with the title of President) (the “Chairman/CEO”) for a period to be
agreed upon by the Executive and the Compensation Committee of the Board of
Directors (the “Compensation Committee”), such period currently expected
to extend until on or about April 1, 2008 (the “CEO Period”, which until
otherwise agreed shall, for purposes of this Agreement, be treated as extending
through April 30, 2008), and thereafter (and after employment of a new Chief
Executive Officer) as the Corporation’s Chairman of the Board (the “Chairman”)
for the period ending December 31, 2011 (the “Chairman Only Period”,
which until otherwise agreed shall, for purposes of this Agreement, be treated
as commencing on May 1, 2008).  The
period ending December 31, 2011 is hereinafter sometimes referred to as the “Employment
Period”.  The Employment Period may
be extended by mutual agreement of the parties.

(b)           Offices,
Duties and Responsibilities.  The
Executive shall perform such customary, appropriate and reasonable executive
duties as are usually performed by a Chairman/CEO or Chairman, as the case may
be.  The Executive’s offices shall be
located at the Corporation’s headquarters building in McLean, Virginia.

(c)           Devotion
to Interests of the Corporation. 
Except as expressly authorized by the Board and so long as the Executive
serves as Chairman/CEO, the Executive will not, without the prior written
consent of the Corporation, directly or indirectly engage in any other business
activities or pursuits, except activities in connection with (i) any professional,
charitable or civic activities (other than as an officer), (ii) personal
investments, (iii) serving as an executor, trustee or in another similar
fiduciary capacity for a non-commercial entity, and (iv) continued service on a
number of corporate boards consistent with the Executive’s current board
service; provided, however, that any such activities do not materially
interfere with the performance of his responsibilities and obligations pursuant
to this Agreement.  These restrictions
shall not apply to the Executive during the Chairman Only Period. The Executive
shall use his best efforts to promote the interests and welfare of the
Corporation.

2.             Compensation and
Fringe Benefits.

(a)           Base Compensation.  So long as the Executive serves as
Chairman/CEO, and effective as of March 1, 2007, the Corporation shall pay the
Executive a base salary at the rate of $300,000 per year, as adjusted from time
to time with the approval of the Compensation Committee (“CEO Base
Compensation”). The Executive’s base salary during the Chairman Only Period
shall be at a reduced level as agreed upon between the Executive and the
Compensation Committee (“Chairman Base Compensation”). The CEO Base
Compensation and Chairman Base Compensation shall be payable in installments in
accordance with the Corporation’s regular practice for compensating executive
personnel.

(b)           Incentive
Compensation.  The Executive shall be
entitled to performance-based incentive compensation (“Incentive
Compensation”) during the CEO Period in an amount up to 65% of the CEO Base
Compensation.  The Incentive Compensation
payable for each applicable period shall be contingent on and based on
corporate and individual performance criteria agreed to between the Executive and
the Compensation Committee on or before April 15, 2007 and as thereafter
modified from time to time. At or before the commencement of the Chairman Only
Period, the Executive and the Compensation Committee will agree on the extent,
if any, to which the Executive shall be entitled to Incentive Compensation
during the Chairman Only Period.  The
target amount payable as Incentive Compensation, as agreed upon between the
Executive and the Compensation Committee from time to time, is hereinafter
referred to as the “Incentive Compensation Target.”

(c)           Fringe
Benefits.  The Executive shall also
be entitled to such fringe benefits as are generally made available by the
Corporation to executive personnel, including, but not limited to, health
insurance.  The Executive also will be
reimbursed for reasonable expenses incurred in connection with travel and
entertainment related to the Corporation’s business and affairs, to be paid by
the Corporation in a manner consistent with past practice and as amended by any
subsequent changes of corporate policy.

(d)           Restricted
Stock.  In connection with the
execution of this Agreement, the Executive shall also be awarded one hundred
fifty thousand (150,000) shares of restricted stock under the terms of the
Company’s 2006 Omnibus Incentive Compensation Plan, thirty thousand (30,000) of
such shares to vest on each December 31 during the Employment Period commencing
with December 31, 2007 so long as the Executive continues to serve as 

 2
 

Chairman/CEO or Chairman, as the case may be, and with acceleration
following a change in control as defined in the applicable award agreement.

3.             Trade
Secrets.  The Executive shall not use
or disclose any of the Corporation’s trade secrets or other confidential
information.  The term “trade secrets or
other confidential information” includes, by way of example, matters of a
technical nature, such as scientific, trade and engineering secrets, “know-how,”
formulae, secret processes or machines, inventions, computer programs
(including documentation of such programs) and research projects, and matters
of a business nature, such as proprietary information about costs, profits,
markets, sales, lists of customers, plans for future development, and other
information of a similar nature that is designated as confidential or generally
maintained as confidential or proprietary by the Corporation.  After termination of the Executive’s
employment, the Executive shall not use or disclose trade secrets or other
confidential information unless such information becomes a part of the public
domain other than through a breach of the Corporation’s policies or is
disclosed to the Executive by a third party who is entitled to receive and
disclose such information.

4.             Return
of Documents and Property.  Upon the
effective date of notice of the Executive’s or the Corporation’s election to
terminate the Executive’s employment, or at any time upon the request of the
Corporation, the Executive (or his heirs or personal representatives) shall
deliver to the Corporation (a) all documents and materials containing trade
secrets or other confidential information relating to the Corporation’s
business and affairs, and (b) all documents, materials and other property
belonging to the Corporation, which in either case are in the possession or
under the control of the Executive (or his heirs or personal representatives).

5.             Discoveries
and Works.  All discoveries and works
made or conceived by the Executive during his employment by the Corporation,
jointly or with others, that relate to the Corporation’s activities shall be
owned by the Corporation.  The term “discoveries
and works” includes, by way of example, inventions, computer programs
(including documentation of such programs), technical improvements, processes,
drawings and works of authorship.  The
Executive shall (a) promptly notify, make full disclosure to, and execute and
deliver any documents requested by, the Corporation to evidence or better
assure title to such discoveries and works in the Corporation, (b) assist the
Corporation in obtaining or maintaining for itself at its own expense United
States and foreign patents, copyrights, trade secret protection or other
protection of any and all such discoveries and works, and (c) promptly execute,
whether during his employment by the Corporation or thereafter, all applications
or other endorsements necessary or appropriate to maintain patents and other
rights for the Corporation and to protect its title thereto.  Any discoveries and works which, within six
months after the termination of the Executive’s employment by the Corporation,
are made, disclosed, reduced to a tangible or written form or description, or
are reduced to practice by the Executive and which pertain to the business
carried on or products or services being sold or developed by the Corporation
at the time of such termination shall, as between the Executive and the
Corporation, be presumed to have been made during the Executive’s employment by
the Corporation.  Set forth on Schedule 5
attached hereto is a list of inventions, patented or unpatented, if any, including
a brief description thereof, which are owned by the Executive, which the
Executive conceived or made prior to his employment by the Corporation and
which are excluded from this Agreement.

 3
 

6.             Termination.

(a)           Upon
thirty (30) days’ prior written notice the Corporation may terminate the
Executive’s employment, with or without “Cause,” as defined in Section 6(f)
below.  Upon thirty (30) days’ prior
written notice the Executive may terminate his employment, with or without “Good
Reason,” as defined in Section 6(e) below. 
Upon any termination of the Executive’s employment for any reason, the
Corporation shall:

(i)                                     pay to the Executive any unpaid Base
Compensation through the date of termination;

(ii)                                  pay to the Executive any unpaid Incentive
Compensation earned with respect to completed fiscal periods but not paid
through the date of termination under the terms of applicable incentive
compensation arrangements; and

(iii)                               provide to or for the benefit of the
Executive the benefits, if any, otherwise expressly provided under this Section
6, Section 7 or Section 8, as applicable.

Any payments under this Section 6, Section 7 or Section 8 that are to be
made in connection with the termination of Executive’s employment will be paid
in cash (with deduction of such amount as may be required to be withheld under
applicable law and regulations) within ten (10) business days of Executive’s
termination of employment; provided, however, that in the event
the Executive’s employment is terminated pursuant to Section 6(b) below, then,
at the Corporation’s election, the “No Cause/Good Reason Termination Fee” (as
therein defined) may be payable in equal monthly installments over the
Applicable Severance Period (as defined in Section 6(b)) with the first payment
due within five business days after the date of the Executive’s termination of
employment (collectively, the “Termination Fee Installment Payments”).  All other compensation and employment benefit
arrangements provided for in this Agreement shall cease upon such termination
of employment except to the extent required by law or otherwise expressly
provided by such arrangements.

(b)           In the event the Corporation
terminates the Executive’s employment without Cause or the Executive terminates
his employment for Good Reason, then, in addition to the benefits provided for
under Sections 6(a)(i) and 6(a)(ii) and subject to the provisions of Section 8,
the Corporation shall pay to the Executive (i) a severance benefit equal to the
Executive’s then applicable Base Compensation for a period of twelve (12)
months following the termination of employment if the termination takes place
during the CEO Period or eighteen (18) months if the termination takes place
during the Chairman Only Period (such twelve- or eighteen-month period, as the
case may be, the “Applicable Severance Period”), (ii) the cost of maintaining the level of health insurance then
maintained by the Executive (including family) under Federal COBRA laws for a
period of eighteen (18) months following the effective date of the termination,
plus (iii) an amount equal to
fifty percent (50%) of the Incentive Compensation Target(s), if any, applicable
during the first calendar year ending during the Applicable Severance Period
(collectively, the “No Cause/Good Reason Termination Fee”).  In addition, all unvested restricted stock,
stock options and any other equity-based compensation arrangements 

 4
 

shall vest, and all stock
options and other equity-based compensation arrangements that must be exercised
shall be exercisable in accordance with the applicable award agreement. On or
before March 31 of the calendar year following the calendar year in which the
Executive’s employment with the Corporation is terminated, the Corporation
shall calculate the amount of Incentive Compensation the Executive would have
received had the Executive remained employed by the Corporation for the entire
applicable calendar year.  To the extent
that the amount of the Incentive Compensation the Executive would have received
had the Executive remained employed by the Corporation for the entire
applicable calendar year is in excess of 50% of the Incentive Compensation
Target for that year (the “Overage Amount”), the Corporation shall then
promptly pay to the Executive the Overage Amount.  No Overage Amount shall be payable in respect
of years following the year in which the Executive’s employment with the
Corporation is terminated.

(c)           In
the event the Corporation terminates the Executive’s employment for Cause,
then, in addition to the benefits provided for under Sections 6(a)(i) and
6(a)(ii), all unvested stock options and any other equity-based compensation
arrangements shall be terminated and all vested stock options shall be
exercisable in accordance with the applicable award agreement.

(d)           In
the event the Executive terminates his employment without Good Reason, then, in
addition to the benefits provided for under Sections 6(a)(i) and 6(a)(ii), all
unvested stock options and any other equity-based compensation arrangements
shall be terminated and all vested stock options shall be exercisable in
accordance with the applicable award agreement.

(e)           For
purposes of this Agreement, the Executive shall be considered to have “Good
Reason” to terminate his employment if, without his express written consent
(except as contemplated by this Agreement or in connection with the termination
of his employment voluntarily by the Executive, by the Corporation for Cause,
or under the circumstances described in Section 8 hereof), (i) the
responsibilities of the Executive are substantially reduced or altered, (ii)
the Executive’s Base Compensation is reduced, or (iii) the Executive’s offices
are relocated anywhere other than within a fifty (50) mile radius of his office
in McLean, Virginia; provided, however, that if the Executive terminates
this Agreement for one or more of the reasons stated in clauses (i) or (ii),
the Corporation shall have a period of ten (10) business days after actual
receipt written notice of the Executive’s assertion of Good Reason to cure the
basis for such assertion, and, in the event of cure (or the commencement of
steps reasonably designed to result in prompt cure), the assertion of Good
Reason shall be null and void.

(f)            For
purposes of this Agreement, the Corporation shall have “Cause” to
terminate the Executive’s employment hereunder upon (i) the continued, willful
and deliberate failure of the Executive to perform his duties in a manner
substantially consistent with the manner prescribed by the Board (other than
any such failure resulting from his incapacity due to physical or mental
illness), (ii) the engaging by the Executive in misconduct materially and
demonstrably injurious to the Corporation, (iii) the conviction of the
Executive of commission of a felony, whether or not such felony was committed
in connection with the Corporation’s business, (iv) the circumstances described
in Section 8 hereof, in which case the provisions of Section 8 shall govern the
rights and obligations of the parties, or (v) during
the Chairman Only 

 5
 

Period (but
prior to a Change of Control as defined in Section 7(c) below) the Executive is
nominated for election to the Board of Directors and the Corporation solicits
proxies for his election but the Executive is not elected by the stockholders; provided, however, that if the
Corporation terminates this Agreement for one or more of the reasons stated in
clauses (i) or (ii), the Executive shall have a period of ten (10) business
days after actual receipt written notice of the Corporation’s assertion of
Cause to cure the basis for such assertion, and, in the event of cure (or the
commencement of steps reasonably designed to result in prompt cure), the
assertion of Cause shall be null and void.

(g)           Notwithstanding
any other provision hereof, the Executive shall not be entitled to receive any
payment under Section 6 or 7 of this Agreement that is treated as “deferred
compensation” within the meaning of Section 409A of the Internal Revenue Code
(the “Code”) and the regulations thereunder prior to the time such
payment is permitted to be made under Section 409A(a)(2)(B) of the Code.

7.             Change
in Control.

(a)           All
unvested restricted stock, stock options and any other equity-based
compensation arrangements theretofore granted to Executive shall vest in full
on the date of a “Change in Control” (as defined in Section 7(c) below).

(b)           In
the event that the Corporation terminates the Executive’s employment with the
Corporation without Cause within twelve months after a “Change in Control” (as
defined in Section 7(c) below), or if the Executive terminates his employment
with the Corporation for Good Reason (in accordance with Sections 6(e) and (f)
above) within twelve months after a Change in Control, then, in addition to the
benefits provided for under Sections 6(a)(i) and 6(a)(ii), the Corporation
shall pay to the Executive  a severance
benefit equal to (i) the Executive’s then applicable annual CEO Base
Compensation or Chairman Base Compensation, as the case may be, for the
Applicable Severance Period, (ii) the cost of
maintaining the level of health insurance then maintained by the Executive
(including family) under Federal COBRA laws for 
a period of eighteen (18) months following the effective date of the
termination, plus (iii) an
amount equal to one hundred percent (100%) of the Incentive Compensation
Target(s), if any, applicable during the first calendar year ending during the
Applicable Severance Period.  At the
Corporation’s election, the severance benefit may be payable in Termination Fee
Installment Payments; that is, in equal monthly installments over the
Applicable Severance Period (as defined in Section 6(b)) with the first payment
due within five business days after the date of the Executive’s termination of
employment. In addition, all stock options and other equity-based compensation
arrangements that must be exercised shall be exercisable in accordance with the
terms of the applicable award agreement.

(c)           For
purposes of this Agreement, “Change in Control” shall mean an occurrence
of any of the following events:

(i)                                     an acquisition (other than directly from the
Corporation) of any voting securities of the Corporation (the “Voting
Securities”) by any “person or group” (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the “Exchange 

 6
 

Act”)) other than an employee benefit plan of
the Corporation, immediately after which such person or group has “Beneficial
Ownership” (within the meaning of Rule 13d-3 under the Exchange Act) of more
than fifty percent (50%) of the combined voting power of the Corporation’s then
outstanding Voting Securities; or

(ii)                                  the consummation of (A) a merger,
consolidation or reorganization involving the Corporation, unless the company
resulting from such merger, consolidation or reorganization (the “Surviving
Corporation”) shall adopt or assume this Agreement and the stockholders of
the Corporation immediately before such merger, consolidation or reorganization
own, directly or indirectly immediately following such merger, consolidation or
reorganization, at least fifty percent (50%) of the combined voting power of
the Surviving Corporation in substantially the same proportion as their
ownership immediately before such merger, consolidation or reorganization, (B)
a complete liquidation or dissolution of the Corporation, or (C) a sale or
transfer of all or substantially all of the assets of the Corporation.

(d)           In
the event that, as a result of payments to or for the benefit of the Executive
under this Agreement or otherwise in connection with a Change in Control, any
state, local or federal taxing authority imposes any taxes on the Executive
that would not be imposed but for the occurrence of a Change in Control,
including any excise tax under Section 4999 of the Internal Revenue Code and
any successor or comparable provision, then, in addition to the benefits
provided for under Sections 6(a)(i) and 6(a)(ii) and under Sections 7(a) and
7(b), the Corporation (including any successor to the Corporation) shall pay to
the Executive at the time any such tax becomes payable an amount equal to the
amount of any such tax imposed on the Executive (the amount of any such
payment, the “Parachute Tax Reimbursement”).

8.             Disability;
Death.

(a)           If,
prior to the expiration or termination of the Employment Period, the Executive
shall be unable to perform his duties by reason of disability or impairment of
health for at least six consecutive calendar months, the Corporation shall have
the right to terminate the Executive’s employment on account of disability by
giving written notice to the Executive to that effect, but only if at the time
such notice is given such disability or impairment is still continuing.  In the event of a dispute as to whether the
Executive is disabled within the meaning of this Section 8(a), either party may
from time to time request a medical examination of the Executive by a doctor
selected by the Corporation, and the written medical opinion of such doctor
shall be conclusive and binding upon the parties as to whether the Executive
has become disabled and the date when such disability arose.  The cost of any such medical examination
shall be borne by the Corporation.  If
the Corporation terminates the Executive’s employment on account of disability,
then, in addition to the benefits provided for under Sections 6(a)(i) and
6(a)(ii), all unvested stock options and any other equity-based compensation
arrangements shall be terminated, and all vested stock options shall be
exercisable in accordance with the terms of the applicable award agreement.

 7
 

 

(b)           If,
prior to the expiration or termination of the Employment Period, the Executive
shall die, then, in addition to the benefits provided for under Sections
6(a)(i) and 6(a)(ii), the Employment Period shall terminate without further
notice.  In such an event, all unvested
stock options and any other equity-based compensation arrangements shall be
terminated, and all vested stock options shall be exercisable in accordance
with the terms of the applicable award agreement.

(c)           Nothing
contained in this Section 8 shall impair or otherwise affect any rights and
interests of the Executive under any insurance arrangements, death benefit plan
or other compensation plan or arrangement of the Corporation which may be
adopted by the Board.

9.             Non-Competition/Non-Solicitation.

(a)           Non-Competition.  The Executive agrees that for a period
commencing on the Effective Date and ending at the end of the Applicable
Severance Period (the “Non-Competition Period”), the Executive will not,
except as otherwise provided herein, engage or participate, directly or
indirectly, as principal, agent, officer, employee, employer or consultant or
in any other comparable capacity, in the conduct or management of, any business
which is competitive with any business conducted by the Corporation.  For the purpose of this Agreement, a business
shall be considered to be competitive with the business of the Corporation only
if such business is engaged in providing services similar to (i) any service
currently provided by the Corporation or provided by the Corporation during the
Employment Period; (ii) any service which in the ordinary course of business
during the Non-Competition Period evolves from or results from enhancements to
the services provided by the Corporation as of the Effective Date or during the
Non-Competition; or (iii) any future service of the Corporation as to which the
Executive materially and substantially participated in the design or
enhancement.  Nothing in this Section
9(a) shall be interpreted to prohibit the Executive from continuing to serve as
a non-employee member of the board of directors of services companies that may
compete with the Corporation or, during the Chairman Only Period, as the
non-executive chairman of the board of such companies.

(b)           Non-Solicitation
of Employees.  During the Non-Competition
Period, the Executive will not (for the Executive’s own benefit or for the
benefit of any person or entity other than the Corporation) solicit, or assist
any person or entity other than the Corporation to solicit, any officer,
director, executive or employee of the Corporation or its affiliates to leave
his or her employment.

(c)           Reasonableness.  The Executive acknowledges that (i) the
markets served by the Corporation are national and are not dependent on the
geographic location of executive personnel or the businesses by which they are
employed, (ii) the length of the Non-Competition Period is related to the
length of the Employment Period and the Corporation’s agreement to provide
severance benefits as set forth in Sections 6 or 7, above, that, under certain
circumstances, will provide additional compensation to the Executive upon the
termination of the Executive’s employment; and (iii) the above covenants are
reasonable on their face, and the 

 8
 

parties expressly agree that such restrictions have been designed to be
reasonable and no greater than is required for the protection of the
Corporation.

(d)           Investments.  Nothing in this Agreement shall be deemed to
prohibit the Executive from owning equity or debt investments in any
corporation, partnership or other entity which is competitive with the
Corporation, provided that such investments (i) are passive investments
and constitute five percent (5%) or less of the outstanding equity securities
of such an entity the equity securities of which are traded on a national
securities exchange or other public market, or (ii) are approved by the
Compensation Committee.

10.           Waiver.  The waiver of the breach of any term or
provision of this Agreement shall not operate as or be construed to be a waiver
of any other or subsequent breach of this Agreement.  Failure by the Executive or the Corporation
to insist upon strict compliance with any provision of this Agreement or to
assert any right the Executive or the Corporation may have hereunder,
including, without limitation, the right of the Executive to terminate
employment for Good Reason, shall not be deemed to be a waiver of such
provision or right or of any other provision or rights under this Agreement.

11.           Enforcement.  The Executive agrees that the Corporation’s
remedies at law for any breach or threat of breach by him of Sections 3, 4, 5
or 9 hereof will be inadequate, and that the Corporation shall be entitled to
an injunction or injunctions to prevent breaches of Sections 3, 4, 5 or 9
hereof and to enforce specifically the terms and provisions thereof, in
addition to any other remedy to which the Corporation may be entitled at law or
equity.  If the Corporation sues to
enforce Sections 3, 4, 5 or 9 hereof and fails to prevail in such proceeding,
the court shall award to the Executive his reasonable fees for his attorneys,
the reasonable expenses of his witnesses, and any other reasonable expenses
incurred in connection with the proceeding to the extent that the court
determines that the Executive has prevailed in such proceeding.

12.           Arbitration.  Any dispute or claim other than those
referred to in Section 11, arising out of or relating to this Agreement or
otherwise relating to the employment relationship between the Executive and the
Corporation, shall be submitted to arbitration, in Fairfax County, Virginia,
before a single arbitrator, in accordance with the rules of the American
Arbitration Association as the exclusive remedy for such claim or dispute.  The Executive and the Corporation agree that
such arbitration will be confidential and no details, descriptions, settlements
or other facts concerning such arbitration shall be disclosed or released to
any third party without the specific written consent of the other party, unless
required by law or court order or in connection with enforcement of any
decision in such arbitration.  Any
damages awarded in such arbitration shall be limited to the contract measure of
damages, and shall not include punitive damages.  In any proceeding, whether commenced by the Executive
or by the Corporation, the arbitrator shall award to the Executive his
reasonable fees for his attorneys, the reasonable expenses of his witnesses,
and any other reasonable expenses incurred in connection with the arbitration
to the extent that the arbitrator determines that the Executive has prevailed
in such proceeding.

13.           Full
Settlement.  The Corporation’s
obligation to make any payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action which the
Corporation 

 9
 

may have against the Executive or others. 
In no event shall the Executive be obligated to seek other employment or
take other action by way of mitigation of the amounts payable to the Executive
under any of the provisions of this Agreement, and such amounts shall not be
reduced whether or not the Executive obtains other employment.

14.           Severability.  Should any provision of this Agreement be
determined to be unenforceable or prohibited by any applicable law, such
provision shall be ineffective to the extent, and only to the extent, of such
unenforceability or prohibition without invalidating the balance of such
provision or any other provision of this Agreement, and any such
unenforceability or prohibition in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

15.           Counterparts.  This Agreement may be executed in any number
of counterparts, and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute one and the
same instrument.

16.           Assignment.  The Executive’s rights and obligations under
this Agreement shall not be assignable by the Executive.  The Corporation’s rights and obligations
under this Agreement shall not be assignable by the Corporation except as
incident to the transfer, by merger or otherwise, of all or substantially all
of the business of the Corporation in a transaction in which the successor
entity remains obligated under, or by operation of law or otherwise assumes,
the Corporation’s obligations under this Agreement.  In the event of any such assignment by the
Corporation, all rights of the Corporation hereunder shall inure to the benefit
of the assignee.

17.           Notices.  Any notice required or permitted under this
Agreement shall be deemed to have been effectively made or given if in writing
and personally delivered or sent by registered or certified U.S. mail, UPS or
recognized overnight courier, properly addressed in a sealed envelope, with
delivery charges prepaid.  Unless
otherwise changed by notice, notice shall be properly addressed to Executive if
addressed to:

Dr. Edward H. Bersoff

8322 Woodlea Mill Road

McLean,
VA  22102

and
properly addressed to the Corporation if addressed to:

ATS Corporation

7915 Jones Branch Drive

McLean, Virginia 22102

Attention:  Chairman of Compensation Committee

18.           Miscellaneous.  Except for the separate agreement related to
the award of restricted stock contemplated by Section 2(a), this Agreement
constitutes the entire agreement, and terminates and supersedes all prior
agreements, of the parties hereto relating to the subject matter hereof, and
there are no written or oral terms or representations made by either party
other than those contained herein, except that nothing contained in this
Agreement shall invalidate or 

 10
 

supersede the terms of any previously or subsequently granted stock
options or other equity-based compensation arrangements (including without
limitation the provisions thereof relating to post termination exercisability)
to the extent that such stock options or arrangements provide more favorable
terms to the Executive.  The validity,
interpretation, performance and enforcement of this Agreement shall be governed
by the laws of the Commonwealth of Virginia

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

IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the day and year first above written.

	
  

  	
   

  	
  EXECUTIVE:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/ Dr. Edward H. Bersoff

  
	
   

  	
   

  	
   

  	
   

  	
  Dr. Edward H. Bersoff

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CORPORATION:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  ATS Corporation

  
	
   

  	
   

  	
   

  	
   

  	
  a Delaware Corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Joseph A. Saponaro

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Joseph A. Saponaro

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Chairman, Compensation Committee

  

 

 11

SCHEDULE 5

Inventions Owned by the Executive

None

 12

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