Exhibit 10.1

TRANSITION AGREEMENT

This Transition Agreement (the “Agreement”) is entered into as of August 11,
2006 (the “Effective Date”), by and between CardioTech International, Inc.
(“CardioTech” or the “Company”) and Michael Szycher (“Szycher”) (collectively,
the “Parties”).

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties agree as follows:

1.             TRANSITION PERIOD.  EFFECTIVE AUGUST 7, 2006 (THE “TRANSITION
DATE”), SZYCHER HAS RESIGNED FROM (I) HIS POSITIONS AS PRESIDENT, CHIEF
EXECUTIVE OFFICER AND TREASURER OF CARDIOTECH, (II) THE COMPANY’S BOARD OF
DIRECTORS, AND (III) ALL POSITIONS, OFFICES AND DIRECTORSHIPS WITH ANY
SUBSIDIARIES OF CARDIOTECH.  BEGINNING ON THE TRANSITION DATE AND ENDING ON THE
EARLIER OF AUGUST 6, 2007 OR A TERMINATION OF SZYCHER’S EMPLOYMENT PURSUANT TO
PARAGRAPH 2 BELOW (THE “TRANSITION PERIOD”), SZYCHER SHALL BE EMPLOYED BY
CARDIOTECH IN A NON-EXECUTIVE CAPACITY AS ITS SPECIAL SCIENCE ADVISOR.  IN THAT
CAPACITY, HE SHALL REPORT SOLELY TO CARDIOTECH’S PRESIDENT AND CHIEF EXECUTIVE
OFFICER (“CEO”).  DURING THE TRANSITION PERIOD, SZYCHER SHALL MEET AND/OR
COMMUNICATE WITH COMPANY MANAGEMENT AND SENIOR COMPANY TECHNICAL PERSONNEL AND
PROVIDE SUCH INFORMATION AND EXPERTISE AS HE MAY POSSESS FOR THE PURPOSE OF
TRANSITIONING TO SENIOR COMPANY TECHNICAL PERSONNEL HIS KNOWLEDGE AND EXPERTISE
RELATING TO POLYMER DEVELOPMENT AND RELATED ACTIVITIES CONDUCTED BY THE COMPANY,
UPON THE CEO’S REASONABLE REQUEST.  THE PARTIES AGREE THAT SZYCHER SHALL NOT
PERFORM ANY WORK OR TAKE ANY ACTION ON BEHALF OF THE COMPANY DURING THE
TRANSITION PERIOD EXCEPT AS EXPLICITLY DIRECTED AND AUTHORIZED BY THE CEO AND,
EXCEPT FOR REASONABLE TRANSITION ASSISTANCE AS SPECIFICALLY SET FORTH ABOVE,
AGREED TO BY SZYCHER.  THE PARTIES FURTHER AGREE THAT SZYCHER SHALL PERFORM ALL
WORK AND PROVIDE ALL ASSISTANCE HEREUNDER AT SUCH TIMES AND LOCATIONS AS ARE
MUTUALLY AGREED TO BY THE CEO AND SZYCHER.  IT IS UNDERSTOOD THAT SZYCHER’S
POSITION IS NOT FULL-TIME AND THAT, WITH THE EXCEPTION OF THE TRANSITION
ASSISTANCE SPECIFICALLY SET FORTH ABOVE, HIS SERVICES WILL BE SUBJECT TO HIS
AVAILABILITY AND OTHER OBLIGATIONS HE MAY THEN HAVE.

DURING THE TRANSITION PERIOD, THE COMPANY SHALL COMPENSATE SZYCHER AT THE ANNUAL
RATE OF $325,000, LESS APPLICABLE TAXES AND WITHHOLDINGS, TO BE PAID AT A
MONTHLY RATE OF $23,000 WITH A FINAL PAYMENT OF $49,000 DUE UPON EXECUTION,
DELIVERY AND NON-REVOCATION OF THE RELEASE OF CLAIMS ATTACHED HERETO AS EXHIBIT
A (THE “RELEASE”), AS FURTHER DESCRIBED IN PARAGRAPH 4.  FOR THE DURATION OF THE
TRANSITION PERIOD, THE COMPANY SHALL CONTINUE TO PROVIDE SZYCHER WITH INSURANCE
COVERAGE UNDER ITS GROUP HEALTH, DENTAL, LIFE AND OTHER PLANS, UNDER THE SAME
TERMS THAT APPLIED TO SZYCHER ON THE TRANSITION DATE, SUBJECT TO THE TERMS OF
THOSE PLANS.  DURING THE TRANSITION PERIOD, SZYCHER SHALL NOT BE ELIGIBLE FOR A
BONUS OR OTHER INCENTIVE COMPENSATION, NOR SHALL HE ACCRUE VACATION OR SICK
TIME.

2.             TERMINATION DURING THE TRANSITION PERIOD.  THE COMPANY MAY NOT
TERMINATE SZYCHER’S EMPLOYMENT DURING THE TRANSITION PERIOD OTHER THAN FOR
CAUSE, WHICH SHALL BE DEFINED AS (A) MATERIAL BREACH OF ANY OF THE MATERIAL
TERMS OF THIS AGREEMENT OR THE AGREEMENTS SET FORTH IN SECTION 9 HEREIN AFTER A
30-DAY NOTICE AND OPPORTUNITY TO CURE PERIOD; (B) WILLFUL MISCONDUCT WHICH IS
MATERIALLY INJURIOUS TO THE COMPANY; OR (C) THE CONVICTION OF A FRAUD OR FELONY
OR CRIMINAL OFFENSE INVOLVING DISHONESTY OR MORAL TURPITUDE OR BREACH OF TRUST. 
IF THE COMPANY TERMINATES SZYCHER’S EMPLOYMENT DURING THE TRANSITION PERIOD WITH
CAUSE, SZYCHER SHALL NOT BE

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ENTITLED TO RECEIVE THE FINAL PAYMENT SET FORTH BELOW, AND ANY ENTITLEMENT(S)
SZYCHER HAS, MIGHT HAVE, HAD, OR MIGHT HAVE HAD TO COMPENSATION, BONUSES, WAGES,
OR PARTICIPATION IN ANY BENEFIT PLAN, POLICY, PROGRAM, COMPENSATION AGREEMENT OR
PRACTICE OF THE COMPANY, SHALL TERMINATE IMMEDIATELY, EXCEPT AS REQUIRED BY LAW
AND PROVIDED THAT HIS STOCK OPTIONS SHALL BE GOVERNED BY THE TERMS THEREOF.

3.             SEPARATION FROM EMPLOYMENT.  EFFECTIVE ON THE EARLIER OF
SZYCHER’S TERMINATION IN ACCORDANCE WITH PARAGRAPH 2 OR AUGUST 7, 2007 (THE
“SEPARATION DATE”), SZYCHER’S EMPLOYMENT WITH THE COMPANY SHALL CEASE.  THE
PARTIES AGREE THAT THIS CESSATION OF EMPLOYMENT SHALL CONSTITUTE A “VOLUNTARY
TERMINATION” BY SZYCHER AS THAT TERM IS DEFINED IN SECTION 3 OF THE
NONCOMPETITION AGREEMENT EXECUTED BY THE PARTIES ON OR ABOUT MARCH 27, 1998 (THE
“NONCOMPETITION AGREEMENT”).  ON THE SEPARATION DATE, THE COMPANY SHALL PAY TO
SZYCHER ALL SALARY EARNED AND ALL UNUSED VACATION TIME AS OF THE SEPARATION
DATE.  ON OR SHORTLY AFTER THE SEPARATION DATE, THE PARTIES AGREE TO EXECUTE THE
RELEASE, WHICH SHALL COVER THE DURATION OF THE TRANSITION PERIOD.

4.             FINAL PAYMENT.  FOLLOWING THE SEPARATION DATE, FOLLOWING THE
COMPANY’S RECEIPT OF THE FULLY-EXECUTED RELEASE, AND PROVIDED SZYCHER’S
EMPLOYMENT WAS NOT TERMINATED FOR CAUSE, THE COMPANY WILL ISSUE TO SZYCHER A
ONE-TIME PAYMENT OF $49,000, LESS APPLICABLE TAXES AND WITHHOLDINGS (THE “FINAL
PAYMENT”).  THE FINAL PAYMENT WILL BE PAID IN A LUMP SUM, NO LATER THAN TEN (10)
DAYS FOLLOWING EXPIRATION OF THE REVOCATION PERIOD SET FORTH IN PARAGRAPH 5 OF
THE RELEASE.

5.             HEALTH AND LIFE INSURANCE BENEFITS.  SZYCHER MAY ELECT TO
CONTINUE HIS CURRENT GROUP MEDICAL AND/OR DENTAL INSURANCE COVERAGE FOLLOWING
THE SEPARATION DATE, PROVIDED HE OR HIS ELIGIBLE DEPENDENT(S) REMAIN ELIGIBLE
FOR SUCH COVERAGE UNDER THE FEDERAL LAW KNOWN AS COBRA.  IF SZYCHER ELECTS SUCH
CONTINUATION COVERAGE, AND PROVIDED SZYCHER’S EMPLOYMENT WAS NOT TERMINATED FOR
CAUSE, THE COMPANY WILL CONTINUE TO PAY ON HIS BEHALF THE SAME PORTION OF
PREMIUMS THAT IT PAYS FOR ACTIVE EMPLOYEES WITH THE SAME COVERAGE, THROUGH THE
EARLIER OF (I) FEBRUARY 28, 2008 OR (II) THE DATE SZYCHER BECOMES INELIGIBLE FOR
COBRA COVERAGE.  INFORMATION OUTLINING SZYCHER’S RIGHTS AND RESPONSIBILITIES
UNDER COBRA WILL BE FORWARDED TO HIM ON OR NEAR THE SEPARATION DATE.

For 12 months following the Separation Date, and provided Szycher’s employment
was not terminated for Cause, the Company further agrees to provide Szycher with
life insurance in the amount of 150% of $325,000, the full premium of which
shall be paid by the Company.

Following the Separation Date, any entitlement Szycher has, might have, had, or
might have had to compensation, bonuses, wages, or participation in any benefit
plan, policy, program, contract or practice of the Company, shall terminate,
except as required by federal or state law, by applicable plan terms, or by the
express terms of this Agreement.

6.             STOCK OPTIONS.  THE PARTIES ACKNOWLEDGE THAT SZYCHER HAS BEEN
AWARDED OPTIONS TO PURCHASE 3,230,743 SHARES OF THE COMPANY’S COMMON STOCK, ALL
OF WHICH OPTIONS ARE FULLY VESTED.  THE GRANT DATES AND EXERCISE PRICES OF SUCH
OPTIONS ARE SET FORTH IN EXHIBIT B HERETO.  SZYCHER SHALL HAVE THE RIGHT TO
EXERCISE ANY OR ALL OF HIS OPTION SHARES UNTIL THE EARLIER OF (A) NINETY (90)
DAYS FROM THE SEPARATION DATE OR (B) THE DATE THEY WOULD OTHERWISE EXPIRE BY
THEIR

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TERMS.  THE OPTIONS SHALL TERMINATE ON THE EARLIER OF (I) THE CLOSE OF BUSINESS
ON THE NINETIETH (90TH) DAY FOLLOWING THE SEPARATION DATE, OR (II) THE CLOSE OF
BUSINESS ON THE DATE THEY WOULD OTHERWISE EXPIRE BY THEIR TERMS.

7.             PROPERTY; COMPUTERS.  SZYCHER REPRESENTS AND WARRANTS THAT NO
LATER THAN AUGUST 21, 2006, HE WILL RETURN TO THE CFO ANY AND ALL DOCUMENTS,
PRODUCTS, FILES, NOTES, MEMORANDA, RECORDS, REPORTS, MATERIALS AND INFORMATION
RELATED TO THE COMPANY AND ITS BUSINESS THAT MAY BE AT HIS HOME OR IN HIS
POSSESSION, INCLUDING ALL COPIES, EXTRACTS AND SUMMARIES THEREOF, WHETHER IN
HARD COPY OR ELECTRONIC FORMAT.  HE FURTHER AGREES THAT PRIOR TO RETURNING THESE
ITEMS, HE WILL NOT DISCLOSE THEM OR THEIR CONTENTS TO ANY PERSON OR ENTITY OR
USE THEM OR THEIR CONTENTS FOR ANY PURPOSE EXCEPT FOR THE BENEFIT OF THE
COMPANY.  SZYCHER ALSO AGREES THAT HE WILL NOT ATTEMPT AT ANY TIME IN THE
FUTURE, FOR ANY PURPOSE, TO ACCESS OR USE ANY OF COMPANY’S COMPUTERS OR COMPUTER
NETWORKS OR SYSTEMS, INCLUDING THEIR SERVERS AND ELECTRONIC MAIL SYSTEM, UNLESS
AUTHORIZED TO DO SO BY THE CEO.

SZYCHER FURTHER AGREES TO RETURN, NO LATER THAN AUGUST 21, 2006, TO THE CFO ALL
PROPERTY AND EQUIPMENT OF THE COMPANY IN HIS POSSESSION, INCLUDING BUT NOT
LIMITED TO COMPUTER EQUIPMENT, CELLULAR PHONES, PDAS, ACCESS CARDS AND/OR KEYS,
PASSWORDS OR ACCESS CODES, CALLING CARDS AND CREDIT CARDS.  IN TURN, THE COMPANY
AGREES THAT IT SHALL RETURN TO SZYCHER, NO LATER THAN AUGUST 21, 2006, ANY
PERSONAL EFFECTS REMAINING IN HIS CARDIOTECH OFFICE.

FOR THE DURATION OF THE TRANSITION PERIOD, THE COMPANY SHALL MAKE AVAILABLE TO
SZYCHER SUCH INFORMATION AND COMPANY EQUIPMENT AS MAY BE REASONABLY REQUIRED TO
PERFORM HIS SERVICES FOR THE COMPANY DURING THAT PERIOD.

8.             COOPERATION.  FROM THE EXECUTION OF THIS AGREEMENT FORWARD,
SZYCHER AGREES TO REASONABLY COOPERATE WITH THE COMPANY IN THE DEFENSE OR
PROSECUTION OF ANY THREATENED OR ACTUAL CLAIMS OR ACTIONS WHICH MAY BE BROUGHT
BY, AGAINST OR ON BEHALF OF THE COMPANY, ITS PREDECESSORS OR ANY OF ITS CURRENT
OR FORMER PARTNERS, AGENTS, EMPLOYEES, DIRECTORS OR AFFILIATES AND WHICH RELATE
TO EVENTS OR OCCURRENCES THAT TRANSPIRED OR ARE ALLEGED TO HAVE TRANSPIRED
DURING HIS TENURE WITH THE COMPANY.  SUCH COOPERATION SHALL INCLUDE, WITHOUT
IMPLICATION OF LIMITATION, BEING AVAILABLE TO MEET WITH THE COMPANY’S COUNSEL TO
PREPARE FOR DISCOVERY OR TRIAL AND TO TESTIFY TRUTHFULLY AS A WITNESS WHEN
REASONABLY REQUESTED BY THE COMPANY AT REASONABLE TIMES AND FOR REASONABLE TIME
PERIODS.

9.             CONFIDENTIALITY OF COMPANY INFORMATION; RESTRICTIVE COVENANTS. 
THE PARTIES AGREE THAT BOTH THE NONCOMPETITION AGREEMENT AND THE CONFIDENTIAL
AND PROPRIETARY INFORMATION AGREEMENT WHICH SZYCHER AND THE COMPANY ENTERED INTO
ON OR ABOUT MARCH 27, 1998 (THE “CONFIDENTIALITY AGREEMENT”) ARE INCORPORATED
HEREIN BY REFERENCE AND SHALL REMAIN IN FULL FORCE AND EFFECT FOLLOWING THE
EXECUTION OF THIS AGREEMENT.

10.          ACCORD AND SATISFACTION.  SZYCHER AGREES THAT THE PAYMENTS AND
BENEFITS SET FORTH IN THIS AGREEMENT, TOGETHER WITH ALL OTHER PAYMENTS AND
BENEFITS PREVIOUSLY PROVIDED TO HIM BY THE COMPANY, ARE COMPLETE PAYMENT,
SETTLEMENT, SATISFACTION AND ACCORD WITH RESPECT TO ALL OBLIGATIONS AND
LIABILITIES OF THE RELEASEES TO SZYCHER, AND WITH RESPECT TO ALL CLAIMS THAT
COULD BE ASSERTED BY SZYCHER AGAINST ANY OF THE RELEASEES REGARDING ANY
RELATIONSHIP BETWEEN SZYCHER AND THE COMPANY, AND ANY CHANGE IN OR CESSATION OF
ANY SUCH RELATIONSHIP, INCLUDING, WITHOUT

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LIMITATION, ALL CLAIMS FOR WAGES, SALARY, EXPENSES, INCENTIVE PAY, BONUSES,
BUSINESS EXPENSES, PAID TIME OFF, EQUITY INTERESTS, SEVERANCE PAY, ATTORNEYS’
FEES, COMPENSATORY DAMAGES, EXEMPLARY DAMAGES, OR OTHER COMPENSATION, BENEFITS,
COSTS OR SUMS.  THE COMPANY AGREES THAT SZYCHER’S UNDERTAKINGS IN THIS
AGREEMENT, AND THE PERFORMANCE OF SUCH UNDERTAKINGS, ARE COMPLETE PAYMENT,
SETTLEMENT, SATISFACTION AND ACCORD WITH RESPECT TO ALL OBLIGATIONS AND
LIABILITIES OF SZYCHER TO THE COMPANY.  PROVIDED, HOWEVER, THAT NOTHING IN THIS
AGREEMENT IS INTENDED TO RELEASE OR DISCHARGE ANY OF THE COMPANY’S INSURANCE OR
INDEMNITY OBLIGATIONS TO SZYCHER REGARDING SZYCHER’S SERVICE AS PRESIDENT, CHIEF
EXECUTIVE OFFICER AND TREASURER AND MEMBER OF THE BOARD OF THE COMPANY OR ANY
OTHER POSITION WITH THE COMPANY HE MAY HAVE HELD.

11.          NON-DISPARAGEMENT; REFERENCES AND OTHER COMMUNICATIONS.  FROM THE
EXECUTION OF THIS AGREEMENT FORWARD, SZYCHER AGREES NOT TO MAKE ANY STATEMENT,
WRITTEN OR ORAL, WHICH DISPARAGES THE COMPANY, ITS BUSINESS AND SERVICES, OR ANY
OF ITS PARTNERS, MEMBERS, DIRECTORS, OFFICERS, EMPLOYEES, OR AGENTS.  SZYCHER
FURTHER AGREES NOT TO MAKE ANY STATEMENT OR TAKE ANY ACTION WHICH HAS THE
INTENDED OR FORESEEABLE EFFECT OF HARMING THE BUSINESS INTERESTS OF THE COMPANY,
AND TO REFRAIN FROM ENGAGING IN ANY COMMUNICATIONS REGARDING THE COMPANY WITH
SHAREHOLDERS, RESEARCH ANALYSTS OR OTHERS IN THE FINANCIAL COMMUNITY.   IN
ADDITION, SZYCHER AGREES THAT HE WILL REFRAIN FROM SPEAKING TO THIRD PARTIES ON
BEHALF OF THE COMPANY UNLESS REQUESTED TO DO SO BY THE CEO.

FOR ITS PART, THE COMPANY AGREES THAT ITS SENIOR EXECUTIVE OFFICERS AND THE
MEMBERS OF THE COMPANY’S BOARD OF DIRECTORS WILL NOT MAKE ANY STATEMENT, WRITTEN
OR ORAL, TO ANY PERSON OR ENTITY NOT AFFILIATED WITH THE COMPANY (EXCLUDING
AGENTS OF THE COMPANY) WHICH DISPARAGES SZYCHER, HIS BUSINESS REPUTATION AND
QUALIFICATIONS, OR HIS EMPLOYMENT AS CHIEF EXECUTIVE OFFICER OF THE COMPANY.

NOTHING IN THIS PARAGRAPH SHALL PROHIBIT OR BAR THE PARTIES FROM PROVIDING
TRUTHFUL TESTIMONY IN ANY LEGAL PROCEEDING OR IN COMMUNICATING WITH ANY
GOVERNMENTAL AGENCY OR REPRESENTATIVE OR FROM MAKING ANY TRUTHFUL DISCLOSURE
REQUIRED UNDER LAW; PROVIDED, HOWEVER, THAT ADVANCE WRITTEN NOTICE IS PROVIDED
BY EITHER PARTY OF THE INTENT TO MAKE SUCH DISCLOSURES AND PROVIDED THAT BEST
EFFORTS WILL BE USED TO ENSURE THAT THIS PARAGRAPH IS COMPLIED WITH TO THE
MAXIMUM EXTENT POSSIBLE.  MOREOVER, NOTHING HEREIN SHALL PREVENT SZYCHER FROM
PARTICIPATING IN ANY PROCEEDING BEFORE ANY FEDERAL OR STATE ADMINISTRATIVE
AGENCY TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, PROVIDED THAT HE WILL
BE PROHIBITED TO THE FULLEST EXTENT AUTHORIZED BY LAW FROM OBTAINING MONETARY
DAMAGES IN ANY AGENCY PROCEEDING IN WHICH HE DOES SO PARTICIPATE.

The parties agree to issue a press release in the form attached hereto as
Exhibit C and agree that any public statements will be in accordance with
Exhibit C and/or with any SEC filings.

12.          GENERAL RELEASE BY SZYCHER.  SZYCHER, ON BEHALF OF HIMSELF AND HIS
SPOUSE, HEIRS, CHILDREN, SUCCESSORS, CURRENT AND FORMER AGENTS, REPRESENTATIVES,
EXECUTORS, BENEFICIARIES, ADMINISTRATORS, TRUSTEES, ATTORNEYS AND ASSIGNS,
VOLUNTARILY RELEASES AND DISCHARGES THE COMPANY AND ITS PREDECESSORS,
SUCCESSORS,  AND CURRENT AND FORMER ASSIGNS, AGENTS, OFFICERS, PARTNERS,
MEMBERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES, REPRESENTATIVES, INSURERS,
INVESTORS, ATTORNEYS, AFFILIATES, AND ANY OTHER RELATED ENTITIES; AND ALL
PERSONS ACTING BY, THROUGH, UNDER, OR IN CONCERT WITH ANY OF THEM (ANY AND ALL
OF WHICH ARE REFERRED TO AS “RELEASEES”), FROM ANY AND ALL CHARGES,

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COMPLAINTS, CLAIMS, LIABILITIES, OBLIGATIONS, PROMISES, AGREEMENTS, CAUSES OF
ACTION, DAMAGES, LOSSES, EXPENSES, AND DEBTS OF ANY NATURE WHATSOEVER, KNOWN OR
UNKNOWN (“CLAIMS”), WHICH SZYCHER HAS, CLAIMS TO HAVE, EVER HAD, OR EVER CLAIMED
TO HAVE HAD AGAINST RELEASEES THROUGH THE EFFECTIVE DATE.  THIS GENERAL RELEASE
OF CLAIMS INCLUDES, WITHOUT IMPLICATION OF LIMITATION, ALL CLAIMS RELATING TO
SZYCHER’S EMPLOYMENT AND SEPARATION FROM EMPLOYMENT WITH THE COMPANY; ALL CLAIMS
RELATING TO SZYCHER’S RELATIONSHIP TO, INTEREST, EQUITY OR INVESTMENT IN,
MEMBERSHIPS IN, OR PARTNERSHIPS WITH THE COMPANY; ALL CLAIMS OF DISCRIMINATION,
HARASSMENT AND RETALIATION PROHIBITED BY ANY FEDERAL, STATE, OR LOCAL STATUTE,
REGULATION, OR ORDINANCE, INCLUDING WITHOUT IMPLICATION OF LIMITATION, TITLE VII
OF THE CIVIL RIGHTS ACT OF 1964, THE AGE DISCRIMINATION IN EMPLOYMENT ACT, THE
AMERICANS WITH DISABILITIES ACT, THE FAMILY AND MEDICAL LEAVE ACT, THE EMPLOYEE
RETIREMENT INCOME SECURITIES ACT AND MASSACHUSETTS GENERAL LAWS CHAPTER 151B;
AND ALL OTHER STATUTORY OR COMMON LAW CLAIMS.  SZYCHER ALSO WAIVES ANY CLAIM FOR
REINSTATEMENT, ATTORNEYS’ FEES, INTEREST, OR COSTS, AND ALL CLAIMS FOR WAGES OR
OTHER COMPENSATION, PROVIDED THAT THIS RELEASE SHALL NOT BE CONSTRUED TO (A)
IMPAIR HIS RIGHT TO ENFORCE THE TERMS OF THE AGREEMENT, OR (B) RELEASE OR
DISCHARGE ANY OF CARDIOTECH’S INSURANCE OR INDEMNITY OBLIGATIONS TO SZYCHER
REGARDING SZYCHER’S SERVICE AS PRESIDENT, CHIEF EXECUTIVE OFFICER, TREASURER AND
MEMBER OF THE BOARD OF THE COMPANY AND SUCH OTHER POSITIONS WITH THE COMPANY AS
HE MAY HAVE HELD.  ADDITIONALLY, NOTHING IN THIS AGREEMENT SHALL BE INTERPRETED
TO PROHIBIT SZYCHER FROM FILING AN AGE DISCRIMINATION CLAIM WITH ANY
ANTI-DISCRIMINATION AGENCY, OR FROM PARTICIPATING IN AN AGE DISCRIMINATION
INVESTIGATION OR PROCEEDING CONDUCTED BY ANY SUCH AGENCY.  HOWEVER, BY SIGNING
THIS AGREEMENT, SZYCHER ACKNOWLEDGES THAT HE IS WAIVING ANY AND ALL RIGHTS TO
MONEY DAMAGES AND ANY OTHER RELIEF THAT MIGHT OTHERWISE BE AVAILABLE SHOULD HE
OR ANY OTHER ENTITY PURSUE CLAIMS ARISING OUT OF OR RELATING TO HIS EMPLOYMENT
WITH THE COMPANY AGAINST THE RELEASEES.

13.          GENERAL RELEASE BY THE COMPANY.  THE COMPANY, ON BEHALF OF ITSELF
AND ITS PREDECESSORS, SUCCESSORS, CURRENT AND FORMER ASSIGNS, AGENTS, OFFICERS,
PARTNERS, MEMBERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES, REPRESENTATIVES,
INSURERS, INVESTORS, ATTORNEYS, AFFILIATES, AND ANY OTHER RELATED ENTITIES; AND
ALL PERSONS ACTING BY, THROUGH, UNDER, OR IN CONCERT WITH ANY OF THEM,
VOLUNTARILY RELEASES AND DISCHARGES SZYCHER AND HIS SPOUSE, HEIRS, CHILDREN,
SUCCESSORS, CURRENT AND FORMER AGENTS, REPRESENTATIVES, EXECUTORS,
BENEFICIARIES, ADMINISTRATORS, TRUSTEES, ATTORNEYS AND ASSIGNS, FROM ANY AND ALL
CHARGES, COMPLAINTS, CLAIMS, LIABILITIES, OBLIGATIONS, PROMISES, AGREEMENTS,
CAUSES OF ACTION, DAMAGES, LOSSES, EXPENSES, AND DEBTS OF ANY NATURE WHATSOEVER,
KNOWN OR UNKNOWN, WHICH THE COMPANY HAS, CLAIMS TO HAVE, EVER HAD, OR EVER
CLAIMED TO HAVE HAD AGAINST SZYCHER, THROUGH THE EFFECTIVE DATE, ARISING OUT OF
(A) SZYCHER’S EMPLOYMENT RELATIONSHIP WITH OR SERVICE AS AN EMPLOYEE, OFFICER OR
DIRECTOR OF THE COMPANY OR THE TERMINATION OF SUCH RELATIONSHIP OR SERVICE OR
(B) ANY EVENT, CONDITION, CIRCUMSTANCE OR OBLIGATION THAT OCCURRED, EXISTED OR
AROSE ON OR PRIOR TO THE DATE THE COMPANY SIGNS THIS AGREEMENT; PROVIDED THAT
THIS RELEASE OF CLAIMS SHALL NOT (I) INCLUDE OR EXTEND TO ANY CLAIM BASED UPON,
ARISING OUT OF, OR RELATING TO ANY ACT OR OMISSION BY SZYCHER ABOUT WHICH THE
COMPANY DID NOT KNOW AS OF THE DATE THE COMPANY SIGNS THIS AGREEMENT; OR (II)
INCLUDE OR EXTEND TO ANY SHAREHOLDER DERIVATIVE CLAIMS AGAINST SZYCHER; OR (III)
BE CONSTRUED TO IMPAIR THE COMPANY’S RIGHT TO ENFORCE THE TERMS OF THIS
AGREEMENT.

14.          NON-FILING OF COMPLAINTS OR CHARGES.  BY SIGNING THIS AGREEMENT,
THE PARTIES REPRESENT THAT THEY HAVE NOT FILED ANY COMPLAINT OR CHARGE AGAINST
EACH OTHER OR AGAINST ANY OF THE RELEASEES WITH ANY LOCAL, STATE OR FEDERAL
AGENCY OR COURT, OR ASSIGNED ANY OF THE RELEASED CLAIMS TO ANY THIRD PARTY.

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15.          BINDING NATURE OF AGREEMENT.  THIS AGREEMENT SHALL BE BINDING UPON,
AND INURE TO THE BENEFIT OF, THE PARTIES AND THEIR RESPECTIVE HEIRS,
ADMINISTRATORS, REPRESENTATIVES, EXECUTORS, SUCCESSORS AND ASSIGNS.  THIS
AGREEMENT MAY BE ASSIGNED BY THE COMPANY, BUT MAY NOT BE ASSIGNED BY SZYCHER.

16.          REMEDY FOR BREACH.  SZYCHER UNDERSTANDS AND AGREES THAT CARDIOTECH
MAY SEEK TO RECOVER THE FINAL PAYMENT IF HE MATERIALLY VIOLATES THIS AGREEMENT. 
IN ADDITION, SZYCHER UNDERSTANDS AND AGREES THAT A MATERIAL BREACH OF PARAGRAPHS
7, 8, 9, 11, 12 AND/OR 14 HEREIN COULD RESULT IN IRREPARABLE HARM TO THE COMPANY
AND THAT MONEY DAMAGES WOULD NOT PROVIDE AN ADEQUATE REMEDY.  THEREFORE, SZYCHER
AGREES THAT IN ADDITION TO ANY OTHER RIGHTS THAT THE COMPANY MAY HAVE, THE
COMPANY SHALL HAVE THE RIGHT TO SEEK SPECIFIC PERFORMANCE AND INJUNCTIVE RELIEF
IN THE EVENT SZYCHER MATERIALLY BREACHES ANY OF THOSE PARAGRAPHS OF THIS
AGREEMENT.

17.          USE OF THE AGREEMENT AS EVIDENCE.  THIS AGREEMENT MAY NOT BE USED
AS EVIDENCE IN ANY SUBSEQUENT PROCEEDING OF ANY KIND, EXCEPT ONE IN WHICH THE
RELEASEES OR SZYCHER ALLEGE A BREACH OF THE TERMS OF THIS AGREEMENT OR ELECT TO
USE THIS AGREEMENT AS A DEFENSE TO ANY CLAIM.

18.          ENTIRE AGREEMENT; MODIFICATIONS.  WITH THE EXCEPTION OF THE
NONCOMPETITION AGREEMENT, THE CONFIDENTIALITY AGREEMENT, THE PARTIES’
INDEMNIFICATION AGREEMENT DATED JUNE 10, 1996, AND THE STOCK OPTION AGREEMENTS
APPLICABLE TO THE GRANTS SET FORTH IN EXHIBIT B HERETO, WHICH WILL SURVIVE AND
REMAIN IN FULL FORCE AND EFFECT, THIS AGREEMENT CONTAINS THE ENTIRE AGREEMENT
AMONG THE PARTIES HERETO WITH RESPECT TO THE MATTERS COVERED HEREBY, AND
SUPERSEDES ALL PRIOR AND CONTEMPORANEOUS COMMUNICATIONS, E-MAILS, AGREEMENTS,
REPRESENTATIONS, UNDERSTANDINGS OR NEGOTIATIONS BETWEEN SZYCHER, THE COMPANY
AND/OR THEIR AGENTS AND ATTORNEYS, INCLUDING BUT NOT LIMITED TO THE EMPLOYMENT
AGREEMENT BETWEEN THE PARTIES DATED JANUARY 1, 2005 AND ALL PRIOR EMPLOYMENT
AGREEMENTS.  THIS AGREEMENT MAY BE MODIFIED ONLY BY A WRITTEN AGREEMENT SIGNED
BY AN AUTHORIZED REPRESENTATIVE OF EACH OF THE PARTIES HERETO.  NO WAIVER OF
THIS AGREEMENT OR ANY PROVISION HEREOF SHALL BE BINDING UPON THE PARTY AGAINST
WHOM ENFORCEMENT OF SUCH WAIVER IS SOUGHT UNLESS IT IS MADE IN WRITING AND
SIGNED BY OR ON BEHALF OF SUCH PARTY.

19.          FURTHER ASSURANCES.  THE PARTIES AGREE TO EXECUTE, ACKNOWLEDGE (IF
NECESSARY), AND DELIVER SUCH DOCUMENTS, CERTIFICATES OR OTHER INSTRUMENTS AND
TAKE SUCH OTHER ACTIONS AS MAY BE REASONABLY REQUIRED FROM TIME TO TIME TO CARRY
OUT THE INTENTS AND PURPOSES OF THIS AGREEMENT, PROVIDED THEY DO NOT CREATE ANY
MATERIAL ADDITIONAL OBLIGATIONS UPON EITHER PARTY.

20.          NOTICE AND RIGHT TO CONSIDER.  SZYCHER HAS BEEN ADVISED TO CONSULT
WITH AND HAS CONSULTED WITH AN ATTORNEY BEFORE EXECUTING THIS AGREEMENT.  HE
ACKNOWLEDGES THAT HE HAS BEEN GIVEN THE OPPORTUNITY, IF SO DESIRED, TO CONSIDER
THIS AGREEMENT FOR TWENTY-ONE (21) DAYS BEFORE EXECUTING IT.  THE PARTIES AGREE
THAT ANY CHANGES TO THIS AGREEMENT, WHETHER MATERIAL OR NOT, WILL NOT RE-START
THE 21-DAY PERIOD.  IF SZYCHER DOES NOT SIGN THIS AGREEMENT AND RETURN IT TO THE
COMPANY SO THAT IT IS RECEIVED WITHIN THE 21-DAY PERIOD, IT WILL NOT BE VALID. 
IN THE EVENT THAT SZYCHER EXECUTES THIS AGREEMENT WITHIN LESS THAN TWENTY-ONE
(21) DAYS, HE ACKNOWLEDGES THAT SUCH DECISION WAS ENTIRELY VOLUNTARY AND THAT HE
HAD THE OPPORTUNITY TO CONSIDER THIS AGREEMENT FOR THE ENTIRE 21-DAY PERIOD. 
THE PARTIES ACKNOWLEDGE THAT, FOR A PERIOD OF SEVEN (7) DAYS FROM THE DATE THAT
SZYCHER SIGNS THIS AGREEMENT (THE “REVOCATION PERIOD”), HE WILL RETAIN THE RIGHT
TO

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REVOKE THIS AGREEMENT BY WRITTEN NOTICE TO THE COMPANY RECEIVED BEFORE THE END
OF THE REVOCATION PERIOD, AND THAT THIS AGREEMENT WILL NOT BECOME EFFECTIVE OR
ENFORCEABLE UNTIL THE EXPIRATION OF THE REVOCATION PERIOD.

21.          ACKNOWLEDGMENTS AND OTHER TERMS.  SZYCHER AGREES THAT HE HAS
CAREFULLY READ AND UNDERSTANDS ALL OF THE PROVISIONS OF THIS AGREEMENT, THAT HE
HAS BEEN ADVISED TO CONSULT WITH AND HAS CONSULTED WITH AN ATTORNEY, AND THAT HE
IS VOLUNTARILY ENTERING THIS AGREEMENT.  SZYCHER FURTHER REPRESENTS AND
ACKNOWLEDGES THAT IN EXECUTING THIS AGREEMENT, HE IS NOT RELYING AND HAS NOT
RELIED UPON ANY REPRESENTATION OR STATEMENT MADE BY THE COMPANY (INCLUDING ITS
PARTNERS, MEMBERS, AGENTS, REPRESENTATIVES, DIRECTORS, EMPLOYEES AND ATTORNEYS)
WITH REGARD TO THE SUBJECT MATTER, BASIS OR EFFECT OF THIS AGREEMENT.

22.          INTERPRETATION.  THE LANGUAGE OF ALL PARTS OF THIS AGREEMENT SHALL
IN ALL CASES BE CONSTRUED AS A WHOLE, ACCORDING TO ITS FAIR MEANING, AND NOT
STRICTLY FOR OR AGAINST ANY OF THE PARTIES.  THIS AGREEMENT SHALL BE INTERPRETED
IN SUCH A MANNER AS TO BE EFFECTIVE AND VALID UNDER APPLICABLE LAW, BUT IF ANY
PROVISION HEREOF SHALL BE PROHIBITED OR INVALID UNDER ANY SUCH LAW, SUCH
PROVISION SHALL BE INEFFECTIVE TO THE EXTENT OF SUCH PROHIBITION OR INVALIDITY
WITHOUT INVALIDATING OR NULLIFYING THE REMAINDER OF SUCH PROVISION OR ANY OTHER
PROVISIONS OF THIS AGREEMENT.  THE CAPTIONS OF THE SECTIONS OF THIS AGREEMENT
ARE FOR CONVENIENCE OF REFERENCE ONLY, AND IN NO WAY DEFINE, LIMIT OR AFFECT THE
SCOPE OR SUBSTANCE OF ANY SECTION OF THIS AGREEMENT.

23.          COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN ANY NUMBER OF
COUNTERPARTS AND MAY BE DELIVERED BY FACSIMILE, EACH OF WHICH SHALL BE DEEMED TO
BE AN ORIGINAL BUT ALL OF WHICH TOGETHER SHALL CONSTITUTE ONE AND THE SAME
INSTRUMENT.

24.          GOVERNING LAW.  THIS AGREEMENT SHALL TAKE EFFECT AS AN INSTRUMENT
UNDER SEAL AND SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
MASSACHUSETTS, WITHOUT REGARD TO ITS CONFLICTS OF LAWS PRINCIPLES.  EXCEPT AS
OTHERWISE PROVIDED IN PARAGRAPH 12 OF THIS AGREEMENT, ANY DISPUTES AND CLAIMS
ARISING UNDER OR RELATING TO THIS AGREEMENT AND/OR THE RIGHTS, OBLIGATIONS AND
PERFORMANCE OF THE PARTIES HEREUNDER SHALL BE SETTLED BY A SINGLE ARBITRATOR
SITTING IN BOSTON, MASSACHUSETTS UNDER THE APPLICABLE EMPLOYMENT ARBITRATION
RULES AND PROCEDURES OF

7

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THE AMERICAN ARBITRATION ASSOCIATION.  IN THE EVENT ARBITRATION IS BROUGHT WITH
RESPECT TO THIS AGREEMENT BY EITHER PARTY, THE PREVAILING PARTY SHALL BE
ENTITLED TO RECOVER FROM THE LOSING PARTY HIS OR ITS REASONABLE ATTORNEYS’ FEES
AND EXPENSES.

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as an
instrument under seal as of August 11, 2006.

CARDIOTECH INTERNATIONAL, INC.

 

 

 

 

By:

/s/ Michael F. Adams

 

 

 

 

Name and Title:

CEO and President

 

 

 

 

/s/ Michael Szycher

 

MICHAEL SZYCHER

 

 

8

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Exhibit A

RELEASE OF CLAIMS

This Release of Claims (this “Release”) is entered into as of the last date
indicated on the signature page of this Release by and between CardioTech
International Inc. (“CardioTech” or the “Company”) and Michael Szycher
(“Szycher”).  Szycher and CardioTech agree as follows:

1.    RELEASE BY SZYCHER.  FOR AND IN CONSIDERATION OF THE RECEIPT OF THE FINAL
PAYMENT AND OTHER BENEFITS SET FORTH IN THE AUGUST 11, 2006 TRANSITION AGREEMENT
BETWEEN SZYCHER AND CARDIOTECH (THE “AGREEMENT”), WHICH IS HEREBY INCORPORATED
BY REFERENCE, THE SUFFICIENCY OF WHICH IS HEREBY ACKNOWLEDGED, SZYCHER, ON
BEHALF OF HIMSELF AND HIS SPOUSE, HEIRS, CHILDREN, SUCCESSORS, CURRENT AND
FORMER AGENTS, REPRESENTATIVES, EXECUTORS, BENEFICIARIES, ADMINISTRATORS,
TRUSTEES, ATTORNEYS AND ASSIGNS, VOLUNTARILY RELEASES AND DISCHARGES CARDIOTECH
AND ITS PREDECESSORS, SUCCESSORS,  AND CURRENT AND FORMER ASSIGNS, AGENTS,
OFFICERS, PARTNERS, MEMBERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES,
REPRESENTATIVES, INSURERS, INVESTORS, ATTORNEYS, AFFILIATES, AND ANY OTHER
RELATED ENTITIES; AND ALL PERSONS ACTING BY, THROUGH, UNDER, OR IN CONCERT WITH
ANY OF THEM (ANY AND ALL OF WHICH ARE REFERRED TO AS “RELEASEES”), FROM ANY AND
ALL CHARGES, COMPLAINTS, CLAIMS, LIABILITIES, OBLIGATIONS, PROMISES, AGREEMENTS,
CAUSES OF ACTION, DAMAGES, LOSSES, EXPENSES, AND DEBTS OF ANY NATURE WHATSOEVER,
KNOWN OR UNKNOWN (“CLAIMS”), WHICH SZYCHER HAS, CLAIMS TO HAVE, EVER HAD, OR
EVER CLAIMED TO HAVE HAD AGAINST RELEASEES THROUGH THE DATE LAST WRITTEN BELOW. 
THIS GENERAL RELEASE OF CLAIMS INCLUDES, WITHOUT IMPLICATION OF LIMITATION, ALL
CLAIMS RELATING TO SZYCHER’S EMPLOYMENT AND SEPARATION FROM EMPLOYMENT WITH
CARDIOTECH; ALL CLAIMS RELATING TO SZYCHER’S RELATIONSHIP TO, INTEREST, EQUITY
OR INVESTMENT IN, MEMBERSHIPS IN, OR PARTNERSHIPS WITH CARDIOTECH; ALL CLAIMS OF
DISCRIMINATION, HARASSMENT AND RETALIATION PROHIBITED BY ANY FEDERAL, STATE, OR
LOCAL STATUTE, REGULATION, OR ORDINANCE, INCLUDING WITHOUT IMPLICATION OF
LIMITATION, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE AGE DISCRIMINATION IN
EMPLOYMENT ACT, THE AMERICANS WITH DISABILITIES ACT, THE FAMILY AND MEDICAL
LEAVE ACT, THE EMPLOYEE RETIREMENT INCOME SECURITIES ACT AND MASSACHUSETTS
GENERAL LAWS CHAPTER 151B; AND ALL OTHER STATUTORY OR COMMON LAW CLAIMS. 
SZYCHER ALSO WAIVES ANY CLAIM FOR REINSTATEMENT, ATTORNEYS’ FEES, INTEREST, OR
COSTS, AND ALL CLAIMS FOR WAGES OR OTHER COMPENSATION, PROVIDED THAT THIS
RELEASE SHALL NOT BE CONSTRUED TO (A) IMPAIR HIS RIGHT TO ENFORCE THE TERMS OF
THE AGREEMENT AND THIS RELEASE, OR (B) RELEASE OR DISCHARGE ANY OF CARDIOTECH’S
INSURANCE OR INDEMNITY OBLIGATIONS TO SZYCHER REGARDING SZYCHER’S SERVICE AS
PRESIDENT, CHIEF EXECUTIVE OFFICER, TREASURER AND MEMBER OF THE BOARD OF THE
COMPANY AND SUCH OTHER POSITIONS WITH THE COMPANY AS HE MAY HAVE HELD. 
ADDITIONALLY, NOTHING IN THIS RELEASE SHALL BE INTERPRETED TO PROHIBIT SZYCHER
FROM FILING AN AGE DISCRIMINATION CLAIM WITH ANY ANTI-DISCRIMINATION AGENCY, OR
FROM PARTICIPATING IN AN AGE DISCRIMINATION INVESTIGATION OR PROCEEDING
CONDUCTED BY ANY SUCH AGENCY.  HOWEVER, BY SIGNING THIS RELEASE, SZYCHER
ACKNOWLEDGES THAT HE IS WAIVING ANY AND ALL RIGHTS TO MONEY DAMAGES AND ANY
OTHER RELIEF THAT MIGHT OTHERWISE BE AVAILABLE SHOULD HE OR ANY OTHER ENTITY
PURSUE CLAIMS ARISING OUT OF OR RELATING TO HIS EMPLOYMENT WITH CARDIOTECH
AGAINST THE RELEASEES.

2.    RELEASE BY CARDIOTECH.  THE COMPANY, ON BEHALF OF ITSELF AND ITS
PREDECESSORS, SUCCESSORS, CURRENT AND FORMER ASSIGNS, AGENTS, OFFICERS,
PARTNERS, MEMBERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES, REPRESENTATIVES,
INSURERS, INVESTORS, ATTORNEYS, AFFILIATES, AND ANY OTHER

9

--------------------------------------------------------------------------------

 

related entities; and all persons acting by, through, under, or in concert with
any of them, voluntarily releases and discharges Szycher and his spouse, heirs,
children, successors, current and former agents, representatives, executors,
beneficiaries, administrators, trustees, attorneys and assigns, from any and all
charges, complaints, claims, liabilities, obligations, promises, agreements,
causes of action, damages, losses, expenses, and debts of any nature whatsoever,
known or unknown, which the Company has, claims to have, ever had, or ever
claimed to have had against Szycher, through the date last written below,
arising out of (a) Szycher’s employment relationship with or service as an
employee, officer or director of the Company or the termination of such
relationship or service or (b) any event, condition, circumstance or obligation
that occurred, existed or arose on or prior to the date the Company signs this
Agreement; provided that this release of claims shall not (i) include or extend
to any claim based upon, arising out of, or relating to any act or omission by
Szycher about which the Company did not know as of the date the Company signs
this Release; (ii) include or extend to any shareholder derivative claims
against Szycher; or (iii) be construed to impair the Company’s right to enforce
the terms of this Release or the Agreement.

3.    CONSIDERATION.  IN CONSIDERATION OF SZYCHER’S EXECUTION OF THIS RELEASE,
THE COMPANY WILL PROVIDE HIM WITH THE CONSIDERATION SET FORTH IN THE AGREEMENT,
WHICH CONSIDERATION EMPLOYEE WOULD NOT OTHERWISE BE ENTITLED TO RECEIVE.  EXCEPT
AS SET FORTH IN THIS PARAGRAPH 3, AND SUBJECT TO ANY RIGHT OR CLAIM EMPLOYEE MAY
HAVE UNDER PARAGRAPH 1, IT IS EXPRESSLY AGREED THAT THE COMPANY DOES NOT HAVE
ANY OBLIGATION TO PROVIDE EMPLOYEE AT ANY TIME IN THE FUTURE WITH ANY PAYMENTS,
BENEFITS OR OTHER CONSIDERATION.  THIS RELEASE SHALL NOT SUPERSEDE ANY
CONTINUING OBLIGATIONS THE EMPLOYEE MAY HAVE UNDER THE TERMS OF THE AGREEMENT.

4.    Non-Filing of Complaint or Charges.  By signing this Agreement, the
Parties represent that they have not filed any complaint or charge against each
other or against any of the Releasees with any local, state or federal agency or
court, or assigned any of the released Claims to any third party.

5.    VOLUNTARY WAIVER AND ACKNOWLEDGEMENT.  SZYCHER ACKNOWLEDGES THAT HE HAS
CONSULTED WITH THE ATTORNEY OF HIS CHOICE IN CONNECTION WITH EXECUTING THIS
RELEASE, AND THAT HE HAS BEEN GIVEN THE OPPORTUNITY, IF SO DESIRED, TO CONSIDER
THIS RELEASE FOR TWENTY-ONE (21) DAYS BEFORE EXECUTING IT.  IF SZYCHER DOES NOT
SIGN THIS AGREEMENT AND RETURN IT TO THE CEO AT CARDIOTECH SO THAT IT IS
RECEIVED WITHIN TWENTY-ONE (21) DAYS OF THE SEPARATION DATE AS DEFINED IN THE
AGREEMENT, IT WILL NOT BE VALID.  IN THE EVENT THAT SZYCHER EXECUTES THIS
RELEASE WITHIN LESS THAN 21 DAYS, HE ACKNOWLEDGES THAT SUCH DECISION WAS
ENTIRELY VOLUNTARY AND THAT HE HAD THE OPPORTUNITY TO CONSIDER THIS RELEASE FOR
THE ENTIRE 21-DAY PERIOD.  THE PARTIES ACKNOWLEDGE THAT, FOR A PERIOD OF SEVEN
(7) DAYS FROM THE DATE THAT SZYCHER SIGNS THIS RELEASE (THE “REVOCATION
PERIOD”), HE WILL RETAIN THE RIGHT TO REVOKE THIS RELEASE BY WRITTEN NOTICE TO
THE CEO AT CARDIOTECH, RECEIVED BEFORE THE END OF THE REVOCATION PERIOD, AND
THAT THIS RELEASE WILL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE EXPIRATION
OF THE REVOCATION PERIOD.

6.    OTHER TERMS.  THE PARTIES ACKNOWLEDGE THAT THE PERFORMANCE OF THE PROMISES
OF EACH ARE CONTINGENT UPON THE FULFILLMENT OF THE OBLIGATIONS OF THE OTHER
PARTY AS SET FORTH IN THIS RELEASE AND THE AGREEMENT.  THE PARTIES AGREE THAT
THIS RELEASE IS NOT, AND SHALL NOT BE CONSTRUED TO BE, AN ADMISSION OF ANY
VIOLATION OF ANY FEDERAL, STATE OR LOCAL STATUTE OR REGULATION, OR OF ANY DUTY
OWED BY EITHER PARTY.  THIS RELEASE SHALL TAKE EFFECT AS AN INSTRUMENT UNDER
SEAL AND SHALL BE

10

--------------------------------------------------------------------------------

 

GOVERNED AND CONSTRUED IN ACCORDANCE WITH MASSACHUSETTS LAW.  IF ANY PROVISION
OF THIS RELEASE IS DEEMED INVALID, THE REMAINING PROVISIONS SHALL NOT BE
AFFECTED AND SHALL BE ENFORCED TO THE MAXIMUM EXTENT PERMITTED BY LAW.

IN WITNESS WHEREOF, the Parties have executed this Release as of the date last
written below.

 

 

MICHAEL SZYCHER

 

DATE

 

 

 

CARDIOTECH INTERNATIONAL, INC.

 

 

 

 

 

By

 

 

 

Title:

 

 

DATE

 

11

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Exhibit B

Szycher Stock Option Grants

 

 

 

 

 

 

total

 

grant date

 

options

 

price

 

vested

 

 

 

 

 

 

 

 

 

10/1/96

 

206,184

 

1.9400

 

206,184

 

10/1/96

 

218,228

 

1.9400

 

218,228

 

5/17/98

 

20,000

 

2.1900

 

20,000

 

9/3/98

 

15,000

 

1.1250

 

15,000

 

9/3/98

 

5,000

 

1.1250

 

5,000

 

11/14/98

 

50,000

 

1.8250

 

50,000

 

1/26/99

 

1,000

 

1.8130

 

1,000

 

7/16/99

 

37,037

 

0.8100

 

37,037

 

1/1/00

 

50,000

 

0.5000

 

50,000

 

3/31/00

 

152,794

 

3.0600

 

152,794

 

3/31/00

 

8,170

 

3.0600

 

8,170

 

10/20/00

 

100,000

 

2.2500

 

100,000

 

12/31/00

 

125,000

 

0.8750

 

125,000

 

4/30/01

 

500,000

 

1.1000

 

500,000

 

1/1/02

 

125,000

 

1.8000

 

125,000

 

4/11/03

 

1,017,330

 

0.9200

 

1,017,330

 

4/1/04

 

250,000

 

5.1500

 

250,000

 

2/14/05

 

350,000

 

2.6000

 

350,000

 

 

 

 

 

 

 

 

 

Totals

 

3,230,743

 

 

 

3,230,743

 

 

12

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Exhibit C

FOR IMMEDIATE RELEASE

CARDIOTECH APPOINTS DR. SZYCHER AS SPECIAL SCIENCE ADVISOR

WILMINGTON, MA, August 11, 2006. CardioTech International, Inc. (AMEX: CTE), a
developer and manufacturer of advanced medical device products for the treatment
of cardiovascular and other diseases, today reported the appointment of Dr.
Michael Szycher, 68, as Special Science Advisor for a period of one year.  Dr.
Szycher has resigned from his prior positions as the Company’s Chairman,
President, CEO and Treasurer and as a director of the Company.

CardioTech’s President and CEO Michael Adams said: “Michael Szycher is the
founder of our Company and for the past 10 years has made major contributions.
With the process now beginning for clinical trials of our CardioPassÔ synthetic
coronary artery bypass graft in Europe, we are entering a new stage in our
Company’s development. We are pleased that our founder can continue as an
advisor.”

Commenting on his new role at the Company, Dr. Szycher noted, “I am looking
forward to working with the Company’s dedicated and talented scientific team.
CardioTech is at an exciting stage of its history and I am very pleased to
participate in its growth.”

About CardioTech International:

CardioTech International, Inc. is a medical device company that designs,
develops, manufactures and sells innovative products for the treatment of
cardiovascular, orthopedic, oncological and other diseases. The Company provides
its customers access to a range of proprietary and novel polymer and surface
modification technologies.  CardioPass™ is CardioTech’s proprietary, synthetic
coronary artery bypass graft (SynCAB).  The Company generates revenues from
sales of advanced medical devices, as well as from contracted product design and
development services. More information about CardioTech is available at its
website: http://www.cardiotech-inc.com

CardioTech International believes that this press release contains
forward-looking statements as that term is defined in the Private Securities
Litigation Reform Act of 1995.  Such forward-looking statements are subject to
risks and uncertainties.  Such statements are based on management’s current
expectations and are subject to facts that could cause results to differ
materially from the forward-looking statements.  For further information you are
encouraged to review CardioTech’s filings with the Securities and Exchange
Commission, including its Annual Report on Form 10-K for the period ended March
31, 2006.  The Company assumes no obligation to update the information contained
in this press release.

For Further Information Contact:

Eric Walters

Sylvia Dresner

Vice President & Chief Financial Officer

Senior Vice President

CardioTech International, Inc

VMW Corporate & Investor Relations

978-657-0075

212-616-6161

general-info@cardiotech-inc.com

info@vmwcom.com

 

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