Exhibit 10.1
Termination and Settlement Agreement
Entered into on this 2nd day of October 2005 (the "Effective Date")
(the "Agreement")
By and Between:
Vision-Sciences, Inc., a Delaware (U.S.A.) corporation, having its principal
place of business at 9 Strathmore Road, Natick, Massachusetts 01760, U.S.A., Fax
No. +1-508-650-9976 (the "Company");
And
Three BY Ltd., a company duly organized under the laws of Israel and having its
principal place of business at Migdal Tefen, Israel, Fax No. + 972-4-987-2340
(the "Manufacturer");
WHEREAS, the Parties have entered into a Contract Manufacturing Agreement dated
June 25th 2003, as in effect on the date hereof, together with all related or
ancillary agreements
or instruments (the "Main Agreement");
WHEREAS, the Parties have mutually agreed to terminate the Main Agreement and
settle finally any issues or disputes between them relating to the termination
of the Main Agreement or the parties relationship prior to the date of this
Agreement in accordance with the terms and conditions of this Agreement as
hereinafter stipulated;
1.
CAPITALIZED TERMS USED HEREIN AND NOT OTHERWISE DEFINED HEREIN
SHALL HAVE THE MEANING ASCRIBED THERETO IN THE MAIN AGREEMENT.
2.
WITHOUT DEROGATING FROM THE PROVISIONS OF THIS AGREEMENT, THE
PARTIES AGREE THAT THE MAIN AGREEMENT SHALL BE, AND HEREBY IS, MUTUALLY
TERMINATED (IN ACCORDANCE WITH THE PROVISIONS OF SECTION 17.2 OF THE MAIN
AGREEMENT) EFFECTIVE ON THE DATE THAT IS SIX MONTHS FROM THE DATE OF THIS
AGREEMENT (THE "EFFECTIVE TERMINATION DATE"). THE TERMINATION OF THE MAIN
AGREEMENT SHALL BE WITHOUT DEROGATION OF THE PROVISIONS OF SECTION 18 OF THE
MAIN AGREEMENT. FOR THE SAKE OF CLARITY, IT IS AGREED AND UNDERSTOOD THAT EXCEPT
AS EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER PARTY WILL BE ENTITLED TO ANY
REMUNERATION OR COMPENSATION AS A RESULT OF OR BY REASON OF THE TERMINATION OF
THE MAIN AGREEMENT, EXCEPT AS DESCRIBED IN THIS AGREEMENT, AND THAT UPON THE
EFFECTIVE TERMINATION DATE, THE PARTIES SHALL, AND HEREBY AGREE TO, RELEASE AND
DISCHARGE THE OTHER FROM ANY AND ALL CLAIMS UNDER THE MAIN AGREEMENT, EXCEPT FOR
OR WITHOUT LIMITATION OF THE OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT,
WHICH SHALL SURVIVE THE EFFECTIVE TERMINATION DATE, TOGETHER WITH ANY PROVISIONS
OF THE MAIN AGREEMENT THAT BY THEIR TERMS ARE DESIGNED OR INTENDED TO SURVIVE
THE TERMINATION OF THE MAIN AGREEMENT.
3.
THE COMPANY HEREBY AGREES TO ISSUE, WITHIN 3 BUSINESS DAYS
FOLLOWING THE EFFECTIVE DATE, ITS BINDING PURCHASE ORDER TO THE MANUFACTURER
(THE "PURCHASE ORDER") FOR THE MANUFACTURE OF 180,000 ENT SHEATHS (THE
"SHEATHS") AT A PRICE OF US $1.204 PER UNIT, EX WORKS (INCOTERMS 2000)
MANUFACTURER'S FACILITY, TOTALING US $216,720. THE MANUFACTURER SHALL PROVIDE
THE COMPANY WITH THE COMPLETE LIST OF THE RAW MATERIALS AND THEIR COSTS
PURCHASED FOR THE MANUFACTURE OF THE SHEATHS, PRIOR TO THE FIRST MONTHLY
SHIPMENT. BASED ON ANY DOCUMENTED COST INCREASE OF RAW MATERIALS PURCHASED BY
THE MANUFACTURER FOR THE MANUFACTURE OF THE SHEATHS, COMPARED TO THE LAST
PURCHASE OF SUCH RAW MATERIAL, THE UNIT PRICE OF THE SHEATHS WILL BE ADJUSTED IN
GOOD FAITH BY THE