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Unassociated Document

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE. NO TRANSFER, SALE OR OTHER DISPOSITION OF THIS NOTE MAY BE MADE UNLESS A REGISTRATION STATEMENT WITH RESPECT TO THIS NOTE HAS BECOME EFFECTIVE UNDER SAID ACT, AND SUCH REGISTRATION OR QUALIFICATION AS MAY BE NECESSARY UNDER THE SECURITIES LAWS OF ANY STATE HAS BECOME EFFECTIVE, OR THE COMPANY HAS BEEN FURNISHED WITH AN OPINION OF COUNSEL SATISFACTORY TO COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

 

VYSTAR CORPORATION

PROMISSORY NOTE
                                                                                                                     

 

	March 11, 2011	$_________

 

FOR VALUE RECEIVED, the undersigned, VYSTAR CORPORATION, a Georgia corporation, and its successors and assigns (the “Company”), hereby promises to pay to the order of ________________ (together with each assignee, successor or transferee thereof, “Holder”) the principal amount of ______________________ AND NO/100 DOLLARS ($_______), together with interest thereon calculated from January 1, 2011 in accordance with the provisions of this Promissory Note (the “Note”).

 

1.           Interest.  Interest shall accrue at a rate of ten percent (10%) per annum (calculated on the basis of a 365 day year) on the unpaid principal amount of this Note outstanding from time to time. Interest shall accrue from January 1, 2011 and be payable at Maturity, unless converted as described below.

 

2.           Payments of Principal on Note.

 

	
  

	
(a)

	
Optional Prepayments.  Upon fifteen (15) days prior written notice, the Company may, at any time and from time to time without premium or penalty, prepay all or any portion of the outstanding principal amount of, or interest on, this Note. In connection with each prepayment of principal hereunder, the Company shall also pay all proportionate accrued interest on the principal amount of this Note being repaid.

 

	
  

	
(b)

	
Maturity.  The entire outstanding principal balance on this Note and accrued interest shall be due and payable March 11, 2013 (the “Maturity Date”), unless converted as described below.

 

3.           Warrants.  For each original principal amount of $25,000 in this Note, the Holder will also receive warrants to purchase 10,000 shares of common stock at $0.68 per share, exercisable at any time through March 11, 2013.

 

  

  

  

4.           Conversion.  The principal balance of this Note and accrued interest on this Note may be convertible, at any time until Maturity, into Vystar common stock at $0.68 per share at the Holder’s option.

 

5.           Events of Default.

 

	
  

	
(a)

	
Definition.  An Event of Default shall be deemed to have occurred under this Note if:

 

(i)           Subject to the last sentence of Section 1 above, the Company fails to pay when due and payable the full amount of interest then accrued on this Note or the full amount of any principal payment on this Note and such default continues for thirty (30) days; or

 

(ii)           The Company makes an assignment for the benefit of creditors or admits in writing its inability to pay its debts generally as they become due; or an order, judgment or decree is entered adjudicating the Company bankrupt or insolvent; or any order for relief with respect to the Company is entered under the Federal Bankruptcy Code; or the Company petitions or applies to any tribunal for the appointment of a custodian, trustee, receiver or liquidator of the Company, or of any substantial part of the assets of the Company, or commences any proceeding relating to the Company under any bankruptcy reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction; or any such petition or application is
filed, or any such proceeding is commenced, against the Company and either (A) the Company by any act indicates its approval thereof; consent thereto or acquiescence therein or (B) such petition, application or proceeding is not dismissed within sixty (60) days.

 

The foregoing shall constitute Events of Default whatever the reason or cause for any such Event of Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body.

 

	
  

	
(b)

	
Consequences of Events of Default. If an Event of Default of the type described in Section 5(a)(i) has occurred and is continuing, Holder may declare the outstanding principal amount of this Note (together with all accrued but unpaid interest thereon and all other amounts due in connection therewith) due and payable and demand immediate payment thereof.  If an Event of Default of the type described in Section 5(a)(ii) has occurred, the aggregate principal amount of this Note (together with all accrued interest hereon) shall become immediately due and payable without any action on the part of Holder, and the Company shall immediately pay to Holder all amounts due and payable with respect to this Note. Holder shall also have any other rights which Holder may have been afforded pursuant to applicable law.

 

6.           Amendment and Waiver.  Except as otherwise expressly provided herein, the provisions of this Note may be amended and the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the written consent of Holder.

 

  

  

  

 

7.           Cancellation.  After all principal and accrued interest at any time owed on this Note has been paid in full, this Note shall be surrendered to the Company for cancellation and shall not be reissued.

 

8.           Payments. All payments to be made to Holder shall be made in the lawful money of the United States of America in immediately available funds.

 

9.           Place of Payment.  Payments of principal and interest shall be delivered to Holder at such address as is specified by prior written notice by Holder to the Company.

 

10.           Collection.  In the event this Note is placed in the hands of an attorney for collection, or if Holder incurs any costs incident to the collection of the indebtedness evidenced hereby, the Company and any endorsers hereof agree to pay to Holder an amount equal to all such costs, including without limitation all reasonable attorneys’ fees and all court costs.

 

11.           Governing Law.  All questions concerning the construction, validity and interpretation of this Note will be governed by and construed in accordance with the laws of the State of Georgia.

 

12.           Waiver of Presentment, Demand and Dishonor.  The Company hereby waives presentment for payment, protest, demand, notice of protest, notice of nonpayment and diligence with respect to this Note, and waives and renounces all rights to the benefits of any statute of limitations or any moratorium, appraisement or exemption, now provided or that hereafter may be provided by any federal or applicable state statute, both as to itself and as to all of its property, whether real or personal, against the
enforcement and collection of the obligations evidenced by this Note and any and all extensions, renewals, and modifications hereof.

 

13.           Business Days.  If any payment is due, or any time period for giving notice or taking action expires, on a day which is a Saturday, Sunday or legal holiday in the State of Georgia, the payment shall be due and payable on, and the time period shall automatically be extended to, the next business day immediately following such Saturday, Sunday or legal holiday, and interest shall continue to accrue at the required rate hereunder until any such payment is made.

 

14.           Replacement.  Upon receipt of evidence reasonably satisfactory to the Company of the mutilation, destruction, loss or theft of this Note and the ownership thereof, and, in the case of any such mutilation, upon surrender and cancellation of this Note, the Company shall, upon the written request of Holder, execute and deliver in replacement thereof a new Note in the same form, in the same original principal amount and dated the same date as this Note so mutilated, destroyed, lost or stolen, and such Note so
mutilated, destroyed, lost or stolen shall then be deemed no longer outstanding hereunder.

 

15.           Remedies.  No remedy herein conferred upon Holder is intended to be exclusive of any other remedy, and each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise.

 

  

  

  

16.           Usury Laws.  It is the intention of the Company and Holder to conform strictly to all applicable usury laws now or hereafter in force, and any interest payable under this Note shall be subject to reduction to the amount not in excess of the maximum legal amount allowed under the applicable usury laws as now or hereafter construed by the courts having jurisdiction over such matters. If the maturity of this Note is accelerated by reason of an election by Holder resulting from an Event of Default, voluntary
prepayment by the Company or otherwise, then earned interest may never include more than the maximum amount permitted by law, computed from the date hereof until payment, and any interest in excess of the maximum amount permitted by law shall be canceled automatically and, if theretofore paid, shall at the option of Holder either be refunded to the Company or credited on the principal amount of this Note, or if this Note has been paid, then the excess shall be refunded to the Company. The aggregate of all interest (whether designated as interest, service charges, points or otherwise) contracted for, chargeable, or receivable under this Note shall under no circumstances exceed the maximum legal rate upon the unpaid principal balance of this Note remaining unpaid from time to time. If such interest does exceed the maximum legal rate, it shall be deemed a mistake and such excess shall be canceled automatically and, if theretofore paid, rebated to the Company or credited on the principal
amount of this Note, or if this Note has been repaid, then such excess shall be refunded to the Company.

 

IN WITNESS WHEREOF, the Company has executed and delivered this Note on the date first above written.

 

 

	 	 
VYSTAR CORPORATION

	 
	 	 	 	 
	
 

	
By: 

	 	 
	 	 	 	 
	 	Name: 	 	 
	 	 	 	 
	 	Title:EXHIBIT 10.6

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (“Agreement”), dated as of January 1, 2011, by and between WEYCO GROUP INC., a Wisconsin corporation (the “Company”), and THOMAS W. FLORSHEIM, JR. of Milwaukee, Wisconsin (“Florsheim”).

WITNESSETH

WHEREAS, Florsheim is the Chairman and Chief Executive Officer of the Company, and is familiar with the methods developed by the Company and the products supplied by the Company to its customers; and

WHEREAS, the Company desires to extend the period of its exclusive right to Florsheim’s services for the period commencing with the date hereof and ending on December 31, 2013, in order to assure to itself the successful management of its business, and

WHEREAS, Florsheim is willing to so extend the period of his employment, all on the terms and subject to the conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual agreements hereinafter set forth, the parties hereto agree as follows:

1.           Employment.  The Company hereby employs Florsheim, during the term of this Agreement, in an executive and managerial capacity, to supervise and direct the operations of the Company as they are now or may hereafter be constituted. Florsheim shall have such title and responsibilities as the Company’s Corporate Governance and Compensation Committee of the Board of Directors shall from time to time assign to him, but the duties which he shall be called upon to render hereunder shall not be of a nature substantially inconsistent with those he has rendered and is currently rendering to the Company as its Chairman and Chief Executive Officer.  During the term of this Agreement, Florsheim shall serve also, without additional compensation, in such offices of the Company to which he may be elected or appointed by the Company’s Board of Directors.  The Company shall not require Florsheim, without his consent, to serve principally at a place other than Milwaukee, Wisconsin or its immediate suburban area, and shall exert its best efforts so as not to require him in the performance of his duties hereunder to be absent, without his consent, from said city or its immediate suburban area during any weekend or legal holiday nor for more than ten (10) days in any calendar month.  Florsheim hereby accepts such employment and agrees to devote his full time, attention, knowledge and skill to the business and interest of the Company throughout the period of his employment hereunder.  Florsheim shall be entitled to take vacations in the same manner and for the same periods of time as has been his custom during the previous three years.

  

  

  

 

2.           Compensation.

(a)           As compensation for his services to the Company during the term of this Agreement in whatever capacity or capacities rendered, the Company shall, subject to the provisions of Section 3 hereof, pay Florsheim a salary of $563,500.00 (Five Hundred, Sixty-Three Thousand, Five Hundred Dollars) per annum, or such greater amount per annum as the Corporate Governance and Compensation Committee of the Board of Directors of the Company may, in its discretion, fix; said salary is to be payable in equal, or approximately equal, bi-weekly installments.

(b)           Nothing herein shall preclude Florsheim from receiving any additional compensation, whether in the form of bonus or otherwise, or from participating in any present or future profit-sharing, pension or retirement plan, insurance, sickness or disability plan, stock option plan or other plan for the benefits of Florsheim or the employees of the Company, in each case to the extent and in the manner approved or determined by the Company’s Board of Directors.  The Company shall continue to provide Florsheim the use of an automobile, and other benefits at least equal to those provided to him under his previous contract of employment.  These benefits are set forth in Schedule A hereto.

  

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3.           Term.  The term of this Agreement shall be from the date hereof to and including December 31, 2013.  Florsheim’s employment hereunder shall be subject to the following:

(a)           If, during the period of his employment hereunder, Florsheim is dismissed by the Company for cause, thereupon his employment shall terminate.  “Cause”, for purposes of this subparagraph, shall mean conduct or activities that cause a substantial demonstrable detriment to the Company.

(b)           If Florsheim’s employment terminates pursuant to Section 3(a) above, the Company shall be obligated to pay him his salary and other payments due to be paid hereunder, on or prior to the date of termination; provided, that nothing herein shall be deemed to entitle Florsheim to amounts accrued but not due to be paid, or to accelerate the date on which any payment of salary or bonus is due.

(c)           (i)           If, during the term of this Agreement, the Company for any reason other than that contained in Section 3(a) terminates the employment of Florsheim, or in the event that he terminates his employment following an event described in Section 6 hereof, the Company shall pay to Florsheim as severance pay, on the first day of the seventh month which begins after the date of such termination, a lump sum amount that, when added to any other payments or benefits which constitute “parachute payments”, will be equal to 299% of Florsheim’s “base amount”, as those terms are defined in Section 280G of the Internal Revenue Code of 1986 (the “Code”) and regulations promulgated by the Internal Revenue Service thereunder.  The determination of Florsheim’s base amount shall be made by the Company’s independent auditors.

  

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(ii)           All or a portion of the payment otherwise required to be made pursuant to the provisions of subparagraph (i) above shall be delayed to the extent the Company reasonably anticipates that the Company’s deduction with respect to such payment would be limited or eliminated by application of Code Section 162(m); provided, however that such payment shall be made on the earliest date on which the Company anticipates that the deduction for payment of the amount will not be limited or eliminated by application of Code Section 162(m).  In any event, such payment shall be made no later than the last day of the calendar year in which occurs the six (6) month anniversary of Florsheim’s termination of employment.  Any deferred amounts shall earn interest at the rate of 7% per annum until paid.

(d)           In the event Florsheim is prevented from performing his duties by reason of disability, the salary provided by Section 2(a) of this Agreement shall cease as of the date he becomes permanently disabled, except that the Company shall pay to Florsheim from the date such salary ceases to December 31, 2013, inclusive, a salary at the rate equal to 75% of his then current salary, less any amount received by Florsheim pursuant to a salary continuation insurance plan, the premiums for which are paid in whole or in part by the Company.  Florsheim shall be considered to be suffering from a “disability” if he is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, either (i) receiving income replacement benefits for a period of not less than three months under a welfare plan covering employees of the Company or (ii) unable to engage in any substantial gainful activity.

  

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(e)           In the event Florsheim dies prior to the termination of his employment hereunder (for purposes of this Section 3(e), such employment shall not be deemed terminated if, at the time of his death, the Company was making payments pursuant to Section 3(d) above), the salary provided by Section 2(a) (or Section 3(d), as the case may be) shall cease as of the date of his death (prorated for part of any month), and the Company shall pay to the beneficiary or beneficiaries of Florsheim, as designated by him pursuant to written direction given by him to the Company (or in the absence of such writing or in the event the last such writing filed by him shall designate one or more persons who are not living at the time of his death or shall for any other reason be wholly or partially ineffective, to the personal representatives of his estate) a death benefit equal to his salary hereunder (at the annual rate which was being paid to him at the date of his death) for a three-year period.  Such death benefits shall be payable in thirty-six equal monthly installments, the first of which shall be paid within sixty days next following the date of his death and the remaining of which shall be made on the date during each of the thirty-five next succeeding calendar months corresponding to the date of such first payment.  If any payments are required to be made under this Section 3(e) to a beneficiary of Florsheim who shall have died after having commenced receiving payments hereunder, such payment shall be made to the personal representative of said beneficiary’s estate.

4.           Restrictive Covenants.  During the term of this Agreement, Florsheim shall not, without the prior written consent of the Company, be engaged in or connected or concerned with any business or activity which directly or indirectly competes with the business conducted by the Company; nor will he take part in any activities detrimental to the best interest of the Company.

  

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5.           Remedy for Breach.  In the event of the breach by Florsheim of any of the terms and conditions of this Agreement to be performed by him (including, but not limited to, leaving the Company’s employment or performing services for any person, firm or corporation engaged in a competing or similar line of business with the Company without the written consent of the Company), the Company shall be entitled, if it so elects, to institute and prosecute proceedings in any court of competent jurisdiction, either at law or in equity, to obtain damages for any breach of this Agreement, and to enjoin him (without the necessity of proving actual damage to the Company) from performing services for any such other person, firm or corporation in violation of the terms of this Agreement, or both.  The Company shall not be so entitled, however, in the event Florsheim should voluntarily leave the Company’s employment after the happening of any of the events specified in Section 6 hereof during the term of this Agreement.  The remedies provided herein shall be cumulative and in addition to any and all other remedies which the Company may have at law or in equity.

6.           Specific Events.  The following specific events will affect the rights and obligations of the parties in the event of Florsheim’s leaving the employ of the Company as set forth at Sections 3(c) and 5.

(a)           The replacement of two or more of the existing members of the Company’s Board of Directors by persons not nominated by the Board of Directors; or

(b)           Any amendment to Section 2 of Article III of the Company’s By-Laws to enlarge the number of directors of the Company if the change was not supported by the existing Board of Directors; or

(c)           Any change in Florsheim’s duties or powers such that his duties or powers, as changed, would be of a nature substantially inconsistent with those he has rendered in the past and is currently rendering to the Company as its chief executive officer; or

  

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(d)           A successful tender offer for 15% or more of the shares or merger or consolidation or transfer of assets of the Company; or

(e)           A change in control of more than 15% of the shares in the Company, such that Florsheim decides in good faith that he can no longer effectively discharge his duties.

7.           Non-Disclosure of Secret or Confidential Information, etc.  Anything herein to the contrary notwithstanding, Florsheim, shall hold in a fiduciary capacity for the benefit of the Company all knowledge of customer or trade lists and all other secret or confidential information, knowledge or data of the Company obtained by him during his employment by the Company, which shall not be generally known to the public or to the Company’s industry (whether or not developed by Florsheim) and shall not, during his employment hereunder or after the termination of such employment, communicate or divulge any such information, knowledge or data to any person, firm or corporation other than the Company or persons, firms or corporation designated by the Company.

8.           Reimbursement for Expenses.  Florsheim shall be reimbursed by the Company, upon his submission of appropriate vouchers, for all items of traveling, entertainment and miscellaneous expenses, including membership dues at clubs used primarily for business purposes, reasonably incurred by him on behalf of the Company within the scope of and during his employment hereunder.

9.           Assignment.  This Agreement shall inure to the benefit of and shall be binding upon the successors and assigns of the Company, including any company or corporation with which the Company may merge or consolidate or to which the Company may transfer substantially all of its assets.  Florsheim shall have no power, without the prior written consent of the Company, to transfer, assign, anticipate, mortgage or otherwise encumber in advance any of the payments provided for herein nor shall said payments be subject to levy, seizure, or sequestration for the payment of any debts, judgments, alimony or separate maintenance owed by Florsheim nor shall they be transferable by operation of law in the event of bankruptcy, insolvency or otherwise.

  

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10.           Notices.  Any notice required or permitted hereunder shall be sufficiently given if sent by registered mail, with postage and registration fee prepaid, to the party to be notified at his or its last known address as determined by due diligence by the party sending such notice.

11.           Severability.  Nothing in this Agreement shall be construed so as to require the commission of any act contrary to law, and wherever there may be any conflict between any provision of this Agreement and any contrary material statute, ordinance, regulation, or other rule of law pursuant to which the parties have no legal right to contract, the latter shall prevail; but in such event the provision of this Agreement so affected shall be curtailed and limited only to the extent necessary to bring it within the requirements of such law.  In no event shall such illegality or invalidity affect the remaining parts of this Agreement.

12.           Prior Employment Agreements.  This Agreement supersedes all oral or written employment agreements heretofore made by and between the parties with respect to the subject matter hereof, and any and all such agreements are hereby canceled and terminated in their entirety.

13.           Applicable Law.  This Agreement, executed in the State of Wisconsin, shall be construed in accordance with and governed in all respects by the laws of the State of Wisconsin to the extent not governed by federal law.

  

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14.           Waiver, etc.  No amendment or modification of this Agreement shall be valid or binding on the Company unless made in writing and signed by a duly authorized officer of the Company or upon Florsheim unless made in writing and signed by him.  The waiver of a breach of any provision of this Agreement by either party or the failure of either party to otherwise insist upon strict performance of any provision hereof shall not constitute a waiver of any subsequent breach of any subsequent failure to strictly perform.

15.           Headings, etc.  Section headings and numbers herein are included for convenience of reference only, and this Agreement is not to be construed with reference thereto.  If there shall be any conflict between such numbers and headings and the text of this Agreement, the text shall control.

16.           Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

17.           Section 409A.

 (a)           In order to facilitate compliance with Section 409A of the Internal Revenue Code, the Company and Florsheim agree that they shall neither accelerate nor defer or otherwise change the time at which any payment due hereunder is to be made, except as may otherwise be permitted under Code Section 409A of the Internal Revenue Code and regulations thereunder.

 (b)           Whether a termination of employment has occurred will be construed in a manner consistent with the requirements described in IRS regulations under Code Section 409A.  Termination of employment by the Company on the one hand or by Florsheim on the other hand (other than by death of Florsheim) shall be communicated by a written notice of termination to the other.  That notice shall indicate the specific termination provision in this Agreement relied upon and, to the extent applicable, shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination under the provisions so indicated and the termination date.  The termination date shall be no later than thirty (30) days after the date such written notice is provided but may be earlier if so specified in the notice.

  

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18.           Termination of Certain Benefits.  Coverage under the arrangements described in Section 2(b) shall end upon the Florsheim’s date of termination of employment (or earlier death described in Section 3(e) or earlier disability described in Section 3(d)); provided, however, that Florsheim (or his beneficiaries) shall be permitted to elect COBRA continuing health benefits coverage in accordance with the usual rules of the Company’s health plan and such coverage shall be continued in accordance with those rules so long as Florsheim or his beneficiaries pays the full COBRA premium generally applicable to other terminating employees (and their beneficiaries).

IN WITNESS WHEREOF, Florsheim has duly executed this Agreement and the Company has caused this Agreement to be executed by its duly authorized officers and its corporate seal to be affixed hereunto, all as of the day and year first above written.

 

	  	  	 	
WEYCO GROUP, INC.

	  	  	 	
a Wisconsin corporation,

	  	  	 	  	  
	  	  	 	
By

	
/s/ John W. Florsheim

	  	  	 	  	
John W. Florsheim

	  	  	 	  	  
	  	  	 	
Its

	
          President

	 	 	 	 	 
	
Attest:

	
/s/ John Wittkowske

	 	  	  
	  	
Its Secretary

	 	  	  
	  	  	 	  	  
	  	  	 	/s/ Thomas W. Florsheim, Jr.
	  	  	 	            Thomas W. Florsheim, Jr.

(SEAL)

 

  

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SCHEDULE A

 

Life and Accidental Death and Dismemberment Insurance

 

Health Insurance

 

Weyco Group, Inc. Pension Plan

 

Deferred Compensation Agreement

 

Weyco Group, Inc. Deferred Compensation Plan

 

Weyco Group, Inc. Excess Benefits Plan

 

  

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