Document:

First Amendment to Asset Purchase Agreement

FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT

THIS FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT (this “Amendment”) is made and effective as of November 30, 2012 between Green Plains Grain Company LLC, a Delaware limited liability company, and Green Plains Grain Company TN LLC, a Delaware limited liability company, (each individually, and collectively as the context may require, “SELLER”), Green Plains Renewable Energy, Inc. (“GPRE”) and The Andersons, Inc., an Ohio corporation (“BUYER”).
WHEREAS, SELLER, BUYER and GPRE are parties to that certain Asset Purchase Agreement dated as of October 26 (the “Agreement”) which the Parties have agreed to amend to provide for the purchase by BUYER of the SELLER's accounts receivable pursuant to this Amendment. 
NOW, THEREFORE, in consideration of the foregoing and the representations, warranties and covenants set forth in this Agreement, SELLER, GPRE and BUYER agree that the Agreement is hereby amended as follows (capitalized terms used herein without definition shall have the meanings provided in the Agreement):

		
	1.
	Section 1.1 is amended by the relettering of clause (j) thereof as (k), and adding the following as new clause (j):

“(j) all Receivables (excluding any intercompany receivables among SELLER, GPRE and their affiliates); and” 
		
	2.
	Section 1.2(m) is deleted in its entirety.

		
	3.
	Section 2.1(c) is amended by renumbering subclause (vi) thereof as (vii) and adding the following as new subclause (vi):

“(vi) the unpaid balance of all Receivables; and”

		
	4.
	The first page of Exhibit 2.1(c) is deleted and replaced in its entirety with the attached. 

		
	5.
	Section 2.1(d) is amended by deleting the figure $37,587,874 appearing therein, and replacing it with the following: $49,852,549

		
	6.
	Section 3.1(t) is amended by adding the following to the end of such paragraph:

“The Receivables are due and owing in their entirety, and are not subject to any discount, rebate, counterclaim, diminution, offset or other claim which may grant the account obligors thereof any legal right to pay less than the outstanding balance thereof reflected in Schedule 3.1(t), except by operation of bankruptcy and insolvency laws for the protection of debtors. All Receivables will be paid in full by the account obligor not later than 150 days following the Closing Date.”
		
	7.
	Section 5.5 is deleted and replaced in its entirety with the following:

“5.5 Receivables. (a) As provided in Section 1.2, BUYER is acquiring SELLER's Receivables pursuant to this Agreement for a purchase price equal to the outstanding balance thereof as of the Closing Date, less an amount equal to the product of such outstanding balance multiplied by a percentage equal to four (4.0) percent multiplied by a fraction the numerator of which is 30 and the denominator of which is 365. Any Receivable not paid in full by the account obligor thereunder to BUYER within 150 days following the Closing Date (the “Repurchase Date”) shall be repurchased by SELLER from BUYER for a purchase price equal to the outstanding balance thereof on the Repurchase Date. Within 15 days following the Repurchase Date, BUYER will submit to SELLER written notice of the outstanding balance of any unpaid Receivables as of the Repurchase Date, together with a detailed accounting of the collection history of such account obligor with BUYER showing the calculation used to determine such unpaid balance (the “Receivables Notice”). If SELLER shall dispute the calculations presented in the Receivables Notice, SELLER shall submit a Notice of Objection relating thereto in writing to BUYER within 15 days of its receipt thereof. SELLER shall pay the purchase price to 

BUYER and BUYER shall transfer all right to the undisputed outstanding balance of the Receivables to SELLER 30 days following the Repurchase Date, unless the dispute resolution provisions provided in the next sentence shall apply in which event such payment and transfer shall occur 3 days following such resolution.  The provisions of Sections 2.4(b) and 2.4(c) with respect to the resolution of disputes shall be applied to resolve any dispute reflected in such Notice of Objection. 
(b) If BUYER shall have generated additional receivables after the Closing Date from any party who shall also be an account obligor of any Receivable, payments received from such party shall first be applied to any outstanding obligation specifically designated in writing by such party. All other payments received from such party shall be applied first, in date order, to the Receivables and then to any such additional receivables generated by BUYER unless the account obligor of any Receivable shall have indicated in writing its disagreement with the amount thereof, or alleges the existence of any counterclaim, offset or other reduction applicable against such Receivable,  in which event the payments received from such account obligor (unless the first sentence of this clause (b) shall apply) shall be applied, in date order, to all other uncontested Receivables of such account obligor and then to any such additional receivables of such account obligor generated by BUYER. 
(c) BUYER shall provide an invoice to the account obligor at least once per month prior to the Repurchase Date and shall otherwise attempt to follow SELLER's collection practices to the extent consistent with BUYER's own collection practices, provided, however, anything in the foregoing portion of this sentence to the contrary notwithstanding: (i) BUYER shall have no obligation to commence any legal process, including the initiation of any civil lawsuit, the filing of any criminal complaint, foreclosure upon any collateral, commencement of any involuntary bankruptcy or receivership petition, (ii) BUYER shall have no obligation to incur any out of pocket expenses or unreasonable internal expenses in connection therewith, and (iii) BUYER shall have no obligation to engage in any activity which, in the opinion of BUYER's counsel, shall subject BUYER to any risk of legal liability (items (i) through (iii) collectively referred to as “Formal Collection Processes”). BUYER shall provide to SELLER a listing of all unpaid Receivables on a monthly basis and inform SELLER of any assertion by any account obligor with respect to a Receivable as to defense or counterclaim to the payment thereof and shall reasonably cooperate with SELLER, at SELLER's expense, in jointly pursuing collection of the account.  In the event BUYER chooses not to commence any Formal Collection Process requested by SELLER in conjunction with nonpayment or any defense or counterclaim with respect to an obligor, SELLER may repurchase the Receivable at that time and pursue any collection method it determines to be appropriate.   
(d) SELLER shall, in cooperation with BUYER, promptly following the Closing Date, advise the account obligors of the sale of the Receivables, and shall direct such account obligors to make all future payments to such address or lockbox as BUYER shall designate. Payments received following the Closing Date by SELLER in respect of any Receivable shall be promptly delivered by SELLER to BUYER. BUYER shall  deliver to SELLER any checks or instruments received by BUYER but bearing SELLER's name and SELLER shall thereupon endorse such checks or instruments to BUYER for deposit within 3 days of receipt thereof unless SELLER shall have determined that such check or instrument is a payment of another obligation owed by such account obligor which is not a Receivable. Any such checks or instruments which are not endorsed by SELLER shall not be applied to any Receivable which shall remain unpaid and subject to SELLER's repurchase obligation hereunder. SELLER shall provide a detailed accounting of the other obligation which SELLER asserts is the intended account to be paid. Nothing herein shall be construed to waive or release BUYER's right to assert that any such check or instrument was an intended payment to BUYER for a receivable generated by BUYER but erroneously made out to SELLER.   
6. Section 8.1 is amended by adding the follow as clause (c) thereto:

“(c) If the Closing occurs, and subject to the terms and conditions of this Article 8, in addition to the indemnification provided in Section 8.1(a) and (b), SELLER and GPRE shall jointly and severally indemnify and hold harmless BUYER and its Affiliates, and their respective directors, officers, employees and controlling persons, from and against all Losses asserted against or incurred by any such entity or person as a result of any: (i) breach as of the Closing Date of the representations and warranties of SELLER contained in Section 

3.1(t) of this Agreement (but not in duplication of any ; and (ii) breach of the covenants of SELLER contained in Section 5.5 of this Agreement. All such indemnified representations and warranties of the parties shall survive the Closing Date for a period of eighteen months. All Losses described in this Section 8.1(c) shall be indemnified in full, without deductible, or minimum or maximum amount. Amounts paid in respect of any Receivable by any account obligor which are rescinded or returned by operation of any bankruptcy, insolvency or other law for the protection of creditors shall be added to, and regarded as, Losses for purposes of this indemnification. No claim or payment made pursuant to this Section 8.1(c) shall be applied or credited against, or otherwise serve to reduce, the minimum or maximum indemnification obligations provided in Section 8.1(a) and (b). In determining the amount of any Losses in respect of the breach of any representation or warranty for purposes of this Section 8.1(c) only (but not for determining whether there has been a breach), any representation or warranty that is qualified in scope as to materiality, Material Adverse Effect or similar qualifications shall be deemed to be made or given without such qualification, except where any such representation or warranty requires disclosure of lists or items of a material nature or above a specified threshold.  
7. The terms and conditions of the Agreement, except to the extent specifically amended in this Amendment, are hereby ratified and confirmed, and shall be construed and interpreted in manner consistent with this Amendment as the context may  require. 

IN WITNESS WHEREOF, the Parties have caused their duly authorized officers to execute and deliver this Asset Purchase Agreement as of the day and year first written above.
GREEN PLAINS GRAIN COMPANY LLC

By:      /s/ Todd Becker_________________                    
Name:     Todd Becker
Title:      President & Chief Executive Officer

GREEN PLAINS GRAIN COMPANY TN LLC

By:      /s/ Todd Becker_________________                        
Name:     Todd Becker
Title:      President & Chief Executive Officer

THE ANDERSONS, INC.

By:      /s/ Dennis Addis_________________                            
Name:    Dennis Addis
Title:      President, Grain Group

The undersigned Green Plains Renewable Energy LLC (“GPRE”), as sole or majority owner (directly or indirectly) of each of the SELLERS hereby joins the foregoing Agreement for the purpose of  agreeing to be bound by the terms and conditions of Section 5.3, 5.12, 5.13 and Section 8 thereof.   

GREEN PLAINS RENEWABLE ENERGY, INC.

By:      /s/ Todd Becker_________________                        
Name:     Todd Becker
Title:      President & Chief Executive OfficerExhibit 10.1

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement (“Agreement”)
is effective as of December 1, 2012 (the “Effective Date”), by and among Electromed, Inc., a Minnesota corporation
(the “Corporation”), and Kathleen Skarvan (“Employee”).

 

RECITALS

 

		A.	The Corporation wishes to employ Employee in the position of Chief Executive Officer and Employee
wishes to be employed by the Corporation pursuant to the terms and conditions set forth in this Agreement.

		B.	The Corporation and Employee desire to enter into this Agreement, and it is the intention of the
Corporation and Employee that this Agreement entirely supersedes any prior agreements with respect hereto.

 

 

AGREEMENT

 

In consideration of the above recitals
and the mutual promises set forth in this Agreement, the parties agree as follows:

 

1.            Nature
and Capacity of Employment.  Effective as of the Effective Date, the Corporation hereby agrees to employ the Employee
as its Chief Executive Officer, having such duties as are consistent with those of a Chief Executive Officer for similar businesses,
and such duties as requested by the Corporation in connection with the business, affairs and operations of the Corporation, subject
to the direction of the Board of Directors of the Corporation and pursuant to the terms and conditions set forth in this Agreement.
The Employee hereby agrees to act in that capacity under the terms and conditions set forth in this Agreement. The Employee agrees
to perform or be available to perform the functions of this position, pursuant to the terms of this Agreement.

2.            Term
of Employment.  The term of the Employee’s employment
hereunder shall commence on the Effective Date of this Agreement and shall continue thereafter through the last day of the
calendar year 2013 (“Initial Term”), unless terminated earlier in accordance with Paragraph 4 of this Agreement. 
The term of this Agreement and the Employee’s employment
hereunder shall automatically renew for successive one year periods beyond the expiration of the Initial Term (the “Renewal
Term”), unless at least ninety (90) days prior to the expiration of the Initial Term or any Renewal Term either party hereto
gives written notice to the other party that it does not intend to renew this Agreement for the coming year. During the Initial
Term or any Renewal Term, this Agreement may be terminated pursuant to the terms of Paragraph 4 of this Agreement.

 

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3.            Compensation
and Benefits.

3.1.       Base
Salary.  As of the Effective Date, the Corporation agrees to pay the Employee an annualized base salary of $210,000.00,
which amount shall be earned by the Employee on a pro rata basis as the Employee performs services and which shall be paid according
to the Corporation’s normal payroll practices. The Board of Directors acting reasonably shall annually review and determine
the amount of Base Salary payable pursuant to this Paragraph 3.1. 

3.2       Non-Equity
Incentive Compensation. For the fiscal year ending June 30, 2013, Employee shall receive a bonus in the maximum aggregate amount
of 20% of the base salary set forth in Paragraph 3.1 only if she achieves the goals and milestones set forth in the Fiscal 2013
CEO Bonus Plan, as such goals have been determined by, and as achievement against such goals will be evaluated by, the Personnel
and Compensation Committee of the Board of Directors. Future Non-Equity Incentive Compensation will be determined by the Personnel
and Compensation Committee or the Board of Directors in their discretion. If a bonus is earned in accordance with this Paragraph
3.2, it will be paid to Employee by the Corporation by December 31, 2013 regardless of whether she is employed by the Corporation
on the date payable.

3.3       Incentive
Stock Option. On the Effective Date, or if the Effective Date is not a business day on which stocks listed on the NYSE MKT
national exchange are trading, the first such business day following the Effective Date, Employee shall be granted a non-qualified
stock option to purchase 20,000 shares of the Corporation’s common stock pursuant to the Corporation’s 2012 Stock Incentive
Plan. The option shall have an exercise price equal to the fair market value of the Corporation’s common stock on the date
of the grant, shall have a 10-year term, and shall vest as to 6,667 shares on the last day of each of the Corporation’s fiscal
years ending June 30, 2013, 2014 and 2015 (as to the final 6,666 shares). The remaining terms of the option will be governed by
the 2012 Stock Incentive Plan and the non-qualified stock option agreement to be executed by the Corporation and the Employee on
or about the date of grant.

3.4.       Employee
Benefits. During the Employee’s employment with the Corporation, the Employee shall be entitled to participate in the
retirement plans, health plans, and all other employee benefits made available by the Corporation, as they may be changed from
time to time. The Employee acknowledges and agrees that she will be subject to all eligibility requirements and all other provisions
of these benefits plans, and that the Corporation is under no obligation to the Employee to establish and maintain any employee
benefit plan in which the Employee may participate. The terms and provisions of any employee benefit plan of the Corporation are
matters within the exclusive province of the Corporation’s Board of Directors, subject to applicable law.

 

3.5.       Paid
Time Off. The Corporation agrees that the Employee shall be entitled to Paid Time Off (“PTO”) of up to fifteen
(15) days per calendar year, prorated for any partial calendar year of employment, without reduction of the minimum annual base
salary payable to the Employee pursuant to Paragraph 3.1 of this Agreement. PTO which is unused at the end of any calendar
year will carry over to the next calendar year, subject to the Corporation’s limitations on carry-over and
accrual maximums. At the end of Employee’s employment for any reason, the Corporation will pay Employee for her ending balance
of unused PTO.

 

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3.6.       Other
Benefits: During the Initial Term or Renewal Term, the Corporation shall directly pay the cost of a
cell phone or wireless handheld device for the Employee’s use. Additionally, during the Initial Term or any Renewal
Term, the Corporation shall provide a housing and automobile allowance of up to an aggregate amount of $800 per month. The Corporation
shall also provide a corporate credit card for approved business expenses and shall otherwise reimburse the Employee for, or pay
directly, all reasonable business expenses incurred by the Employee in the performance
of her duties under this Agreement, provided that the Employee incurs and accounts for such expenses in accordance with all Corporation
policies and directives in effect from time to time.

 

4.            Termination
of Employment Prior to the End of the Initial Term or Renewal Term. The Employee’s employment may be terminated prior
to the expiration of the Initial Term or a Renewal Term as follows:

4.1.       For
Cause Termination, Without Severance. Notwithstanding anything contained herein to the contrary, the Corporation may discharge
the Employee for Cause and terminate this Agreement immediately upon written notice to the Employee. For the purposes of this Agreement,
“Cause” shall mean the occurrence of any of the following:

(i)       Employee’s
material failure to perform her job duties competently as reasonably determined by the Corporation’s Board of Directors;
or

(ii)       gross
misconduct by the Employee which the Corporation’s Board of Directors determines is (or will be if continued) demonstrably
and materially damaging to the Corporation; or

(iii)       fraud,
misappropriation, or embezzlement by the Employee; or

(iv)       conviction
of a felony crime or a crime of moral turpitude; or

(v)       the
material breach of this Agreement by the Employee.

With respect to Sections 4.1 (i) and (v),
the Corporation shall first provide Employee with written notice and an opportunity to cure such breach, if curable, in the reasonable
discretion of the Corporation’s Board of Directors, and identify with specificity the action needed to cure within 30 days
of Employee’s receipt of written notice from the Corporation. If the Corporation terminates the Employee’s employment
for Cause pursuant to this Paragraph 4.1, the Employee shall not be entitled to severance pay.

If the Corporation terminates the Employee’s
employment for Cause pursuant to this Paragraph 4.1, the Employee shall not be entitled to severance pay.

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4.2.       Without
Cause, With Severance. The Corporation may terminate the Employee’s employment immediately at any time and for any reason
without Cause upon providing written notice to the Employee. However, in such event, provided that the Employee meets all of the
conditions set forth in this paragraph for receiving severance pay, the Corporation shall pay the Employee severance pay in the
amount of one year’s base salary at her then current base salary (the “Severance Amount”) payable in a lump sum
on the 60th day following termination, together with any earned but unpaid non-equity incentive compensation. The Employee
shall only be entitled to receive the Severance Amount described herein if the Employee (a) complies with her separate Non-Competition,
Non-Solicitation, and Confidentiality Agreement with an effective date of even date herewith and (b) before the 60th
day after her termination, signs, does not rescind and complies with a Confidential Separation Agreement at the time of termination
in a form prepared by the Corporation that includes in part: (i) agreement to a general release of any and all legal claims; (ii)
return of all of the Corporation’s property in the Employee’s possession; and (iii) agreement not to disparage the
Corporation and its representatives. Such release shall not release or waive Employee’s rights to indemnification or advancement
of expenses from the Corporation in accordance with and subject to the Corporation’s Articles of Incorporation, Bylaws, and
Section 302A.521 of the Minnesota Business Corporations Act.

 

4.3       Resignation
By the Employee for Good Reason, With Severance. The Employee may resign the Employee’s position at any time for Good
Reason and receive the Severance Amount described above. “Good Reason” shall mean the occurrence of any of the following:

 

		(i)	a material diminution in the Employee’s responsibilities, authority
or duties; or 

		(ii)	a material diminution in the Employee's salary, other than pursuant
to a reduction in the salary for all executive employees of the Corporation and its affiliates, applied on a pro rata basis to
all salaried executives including Employee;

		(iii)	the material breach of this Agreement by the Corporation.

Notwithstanding the
foregoing, none of the forgoing events shall be considered “Good Reason” if it occurs in connection with Employee’s
death or disability, provided that the Corporation has made diligent efforts to reasonably accommodate Employee’s condition.

Before “Good
Reason” has been deemed to have occurred, Employee must give the Corporation written notice detailing why Employee believes
a Good Reason event has occurred and such notice must be provided to the Board of the Corporation within 90 calendar days after
Employee’s actual knowledge of the initial occurrence of such alleged Good Reason event Employee’s Board shall then
have 30 calendar days after its receipt of written notice to cure the condition cited in the written notice, and if so cured, “Good
Reason” will be deemed not to have occurred with respect to the condition in question. If such condition is not so cured,
“Good Reason” will be deemed to have occurred with respect to the condition in question, and Employee must terminate
employment within 30 calendar days following such 30 calendar day Board cure period. (For these purposes a notice shall be sufficient
if it is transmitted by facsimile or email on to the Board and if it provides a general indication of the nature of the acts, omissions,
breach or breaches.)

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In the event the Board
cannot cure the “Good Reason” as set forth above, and provided that the Employee meets all of the conditions set forth
in this paragraph for receiving severance pay, the Corporation shall pay the Employee severance pay in the amount of one year’s
base salary at her then current base salary (the “Severance Amount”) payable in a lump sum on the 60th day
after termination, together with any earned but unpaid non-equity incentive compensation. The Employee shall only be entitled to
receive the Severance Amount described herein if the Employee (a) complies with her separate Non-Competition, Non-Solicitation,
and Confidentiality Agreement with an effective date of even date herewith and (b) before the 60th day after her termination,
signs, does not rescind, and complies with a Confidential Separation Agreement at the time of termination in a form prepared by
the Corporation that includes in part: (i) agreement to a general release of any and all legal claims; (ii) return of all of the
Corporation’s property in the Employee’s possession; and (iii) agreement not to disparage the Corporation and its representatives.
Such release shall not release or waive Employee’s rights to indemnification or advancement of expenses from the Corporation
in accordance with and subject to the Corporation’s Articles of Incorporation and Section 302A.521 of the Minnesota Business
Corporations Act.

4.4.       Resignation
by the Employee Due to Change of Control, With Severance. For purposes of this Agreement, “Change of Control” means:

(i)       A
“change in ownership,” as described in Section 1.409A-3(i)(5)(v) of the Treasury Regulations.

(ii)       A
“change in effective control,” as described in Section 1.409A-3(i)(5)(vi) of the Treasury Regulations.

(iii)       A
“change in ownership of a substantial portion of the assets,” as described in Section 1.409A-3(i)(5)(vii) of the Treasury
Regulations.

 

Employee shall have the
right to terminate the Employee’s employment for any reason within six (6) months following a Change of Control in the Corporation
occurring subsequent to the Corporation’s Fiscal 2013 Annual Meeting of Shareholders (notice of which was provided to the
Corporation’s shareholders on November 7, 2012), upon providing thirty (30) days advance written notice to the Corporation.
The Corporation may then elect either (a) to have the Employee continue performing work for the Corporation throughout the 30 day
notice period; or (b) to accept the Employee’s resignation effective immediately.

 

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In the event of the
Employee’s termination of employment with the Corporation following a Change of Control under this Paragraph 4.4, provided
that the Employee meets all of the conditions set forth in this paragraph for receiving severance pay, and provided that the Change
in Control event occurred subsequent to the Corporation’s Fiscal 2013 Annual Meeting of Shareholders, the Corporation shall
pay the Employee the Severance Amount outlined in Paragraph 4.2 above in a lump sum on the 60th day after termination.
If a Change of Control event occurs before, at or as a result of actions taken by shareholders at the Corporation’s Fiscal
2013 Annual Meeting of the Shareholders, no severance will be payable under this Paragraph 4.4. In addition, the Employee shall
only be entitled to receive the Severance Amount described herein if the Employee (a) complies with her separate Non-Competition,
Non-Solicitation, and Confidentiality Agreement with an effective date of even date herewith and (b) before the 60th
day after her termination, signs, does not rescind, and complies with a Confidential Separation Agreement at the time of termination
in a form prepared by the Corporation that includes in part: (i) agreement to a general release of any and all legal claims; (ii)
return of all of the Corporation’s property in the Employee’s possession; and (iii) agreement not to disparage the
Corporation and its representatives. Such release shall not release or waive Employee’s rights
to indemnification or advancement of expenses from the Corporation in accordance with and subject to the Corporation’s Articles
of Incorporation and Section 302A.521 of the Minnesota Business Corporations Act.

4.5.       Other
Resignation by the Employee, Without Severance. The Employee may resign the Employee’s position upon providing sixty
(60) days advance, written notice to the Corporation. The Corporation may then elect either (a) to have the Employee continue performing
work for the Corporation throughout the 60 day notice period; or (b) to accept the Employee’s resignation effective immediately.
In the event of the Employee’s termination of employment with the Corporation under this Paragraph 4.5, the Employee shall
not be entitled to severance pay, but Employee shall be entitled to any earned but unpaid non-equity incentive compensation.

 

4.6.       Because
of Death, Disability or Incapacity of the Employee, Without Severance. In the event of the Employee’s death, this Agreement
shall terminate immediately. If the Employee is unable to perform the Employee’s essential job functions, with or without
reasonable accommodation, for more than ninety (90) days, or such longer period as required by law, in any consecutive twelve (12)
month period by reason of physical or mental disability or incapacity, the Corporation may terminate the Employee’s employment
upon thirty (30) days advance written notice to the Employee. This Paragraph does not relieve the Corporation of any duty to reasonably
accommodate a qualifying disability under the Americans with Disabilities Act, the Minnesota Human Rights Act, any legal duty under
the Family Medical Leave Act, or any of its other duties pursuant to applicable law. If the Employee’s employment is terminated
pursuant to this Paragraph, the Employee shall not be entitled to severance pay but Employee shall be entitled to any earned but
unpaid non-equity incentive compensation.

 

4.7       Non-Renewal
By Either Party Upon Expiration of the Initial or Renewal Term. For the avoidance of doubt, the parties agree that either party
may elect, with or without cause, not to renew this Agreement at the end of the then-current Term and that Employee shall not be
entitled to severance pay in the event of non-renewal by either party.

 

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4.8       Section
409A and Taxes Generally. The Corporation shall be entitled to withhold on and report the making of such payments as may be
required by law as determined in the reasonable discretion of the Corporation. Notwithstanding anything in this Agreement to the
contrary, if at the time of Employee’s termination of employment (which shall have the same meaning as “separation
from service” as defined in Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations, notices and
other guidance of general applicability issued thereunder (“Section 409A”)), the Corporation determines that Employee
is a “specified employee” within the meaning of Section 409A, then, to the extent any payment or benefit that Employee
becomes entitled to under this agreement on account of Employee’s separation from service would be considered deferred compensation
subject to Section 409A, such payment shall not be payable and such benefit shall not be provided until the date that is the earlier
of (a) six months and one day after Employee’s separation from service, and (b) Employee’s death. The parties intend
that this Agreement will be administered in accordance with Section 409A and, to the extent that any provision of this Agreement
is ambiguous as to its compliance with Section 409A, the provision shall be read in such a manner so that all payments hereunder
comply with, or are exempt from, Section 409A. The parties agree that this Agreement may be amended, as may be necessary to fully
comply with, or to be exempt from, Section 409A and all related rules and regulations in order to preserve the payments and benefits
provided hereunder without additional cost to either party.

 

5.            Miscellaneous.

5.1.       Integration.
This Agreement embodies the entire agreement and understanding among the parties relative to subject matter hereof and supersedes
all prior agreements and understandings relating to such subject matter, including but not limited to any earlier offers to the
Employee by the Corporation.

5.2.       Applicable
Law. This Agreement and the rights of the parties shall be governed by and construed and enforced in accordance with the laws
of the state of Minnesota.

5.3.       Payments.
All amounts paid under this Agreement shall be subject to normal withholdings or such other treatment as required by law.

 

5.4       Employee’s
Representations. The Employee represents that she is not subject to any agreement or obligation that would prevent or limit
her from entering into this Agreement or that would be breached upon performance of her duties under this Agreement, including
but not limited to any duties owed to any former employers not to compete. If the Employee
possesses any information that she knows or should know is considered by any third party, such as a former employer of the Employee’s,
to be confidential, trade secret, or otherwise proprietary, the Employee shall not disclose such information to the Corporation
or use such information to benefit the Corporation in any way.

 

5.5.       Counterparts.
This Agreement may be executed in several counterparts and as so executed shall constitute one agreement binding on the parties
hereto.

 

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5.6.       Binding
Effect. Except as herein or otherwise provided to the contrary, this Agreement shall be binding upon and inure to the benefit
of the Corporation and its successors, assigns and personal representatives without any requirement of the consent of the Employee
for assignment of its rights or obligations hereunder.

5.7.       Modification.
This Agreement shall not be modified or amended except by a written instrument signed by the parties.

5.8.       Severability.
The invalidity or partial invalidity of any portion of this Agreement shall not invalidate the remainder thereof, and said remainder
shall remain in fully force and effect.

5.9.       Opportunity
to Obtain Advice of Counsel. The Employee acknowledges that the Employee has been advised by the Corporation to obtain legal
advice prior to executing this Agreement, and that the Employee had sufficient opportunity to do so prior to signing this Agreement.

5.10       Indemnification.
As to acts or omissions of Employee which are within the scope of Employee’s authority as an officer, director, or employee
of the Corporation and/or any affiliate of the Corporation, the Corporation will indemnify Employee in accordance with and subject
to the limitations contained in its Articles of Incorporation, Bylaws and Section 302A.521 of the Minnesota Business Corporations
Act. If Employee is made or threatened to be made a party to any threatened, pending, or completed civil, criminal, administrative,
arbitration, or investigative proceeding, including a proceeding by or in the right of the corporation, Employee is entitled, upon
written request to the Corporation, to payment or reimbursement by the Corporation of reasonable expenses, including attorneys'
fees and disbursements, incurred by Employee in advance of the final disposition of the proceeding, (a) upon receipt by the Corporation
of a written affirmation by Employee of a good faith belief that the criteria for indemnification set forth in Section 302A.521,
subdivision 2 of the Minnesota Business Corporations Act have been satisfied and a written undertaking by Employee to repay all
amounts so paid or reimbursed by the Corporation, if it is ultimately determined that the criteria for indemnification have not
been satisfied, and (b) after a determination that the facts then known to those making the determination would not preclude indemnification
under the Corporation’s Articles of Incorporation and Bylaws and Section 302A.521 of the Minnesota Business Corporations
Act, including but not limited to whether the alleged misconduct by Employee that is the subject of the proceeding is within the
course and scope of Employee’s employment.

 

5.11       D&O
Insurance. The Corporation shall maintain an insurance policy or policies providing directors' and officers' liability insurance,
comprehensive general liability insurance, and errors and omissions insurance, and the Employee shall be covered by such policy
or policies, in accordance with its or their terms, to the maximum extent of the coverage available for any officer of the Corporation.

 

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5.12.       280G
Limitations. In the event that the severance and other benefits provided for in this Agreement or otherwise payable to Employee
(a) constitute “parachute payments” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended,
(the “Code”) and (b) would be subject to the excise tax imposed by Code Section 4999, then such benefits shall be either
be: (i) delivered in full, or (ii) delivered as to such lesser extent which would result in no portion of such severance benefits
being subject to excise tax under Code Section 4999, whichever of the foregoing amounts, taking into account the applicable federal,
state and local income and employment taxes and the excise tax imposed by Code Section 4999, results in the receipt by Employee,
on an after-tax basis, of the greatest amount of benefits, notwithstanding that all or some portion of such benefits may be subject
to excise tax under Code Section 4999.

 

           Any
determination required under this Section 5.12 will be made in writing by an accounting firm selected by the Corporation or such
other person or entity to which the parties mutually agree (the “Accountants”), whose determination will be conclusive
and binding upon Employee and the Company for all purposes. For purposes of making the calculations required by this Section 5.12,
the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good
faith interpretations concerning the application of Code Sections 280G and 4999. The Corporation and the Employee shall furnish
to the Accountants such information and documents as the Accountants may reasonably request in order to make a determination under
this Section. The Corporation shall bear all costs the Accountants may reasonably incur in connection with any calculations contemplated
by this Section 5.12. Any reduction in payments and/or benefits required by this Section 5.12 shall occur in the following order:
(A) cash payments shall be reduced first and in reverse chronological order such that the cash payment owed on the latest date
following the occurrence of the event triggering such excise tax will be the first cash payment to be reduced; (B) accelerated
vesting of stock awards, if any, shall be cancelled/reduced next and in the reverse order of the date of grant for such stock awards
(i.e., the vesting of the most recently granted stock awards will be reduced first), with full-value awards reversed before any
stock option or stock appreciation rights are reduced; and (C) deferred compensation amounts subject to Section 409A shall be reduced
last.

 

 

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THIS AGREEMENT was voluntarily and knowingly
executed by the parties effective as of the date and year first set forth above.

 

	 	ELECTROMED, INC.
	 	 
	Date:  November 29, 2012	/s/ Stephen H. Craney
	 	By:  Stephen H. Craney
 Its:   Chairman

 

 

	 	EMPLOYEE:
	 	 
	Date:  November 29, 2012	/s/ Kathleen Skarvan
	 	Kathleen Skarvan

 

 

 

 

 

 

 

 

 

 

 

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