Document:

ex10-202.htm

Exhibit 10.202

 

 

THE SHARES OF COMMON STOCK SUBSCRIBED FOR BY THIS AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY OTHER APPLICABLE STATE SECURITIES LAWS AND TRANSFER OF SUCH SHARES IS RESTRICTED BY THE TERMS OF THIS AGREEMENT.

SUBSCRIPTION AGREEMENT

 

This SUBSCRIPTION AGREEMENT (the “Agreement”) is made by and between the subscriber hereto (the “Subscriber”) and Calypte Biomedical Corporation, a Delaware corporation (the “Company”).

 

 The Subscriber hereby agrees to purchase, and the Company hereby agrees to issue and to sell to the Subscriber, the number of shares (the “Shares”) of common stock of the Company, par value $.03 per share (the “Common Stock”), set forth on the signature page, for a purchase price in cash equal to $0.03 per share (the aggregate amount to be paid by the Subscriber shall be referred to as the “Purchase Price”). After acceptance of this Agreement by the Company and payment and delivery by the
Subscriber to the Company of the Purchase Price in the form of wire transfer pursuant to the terms of Section 7(b) of this Agreement, the Company shall issue and deliver to the Subscriber the Shares.

 

NOW, THEREFORE, in order to implement the foregoing and in consideration of the mutual representations, warranties, covenants and agreements contained herein and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows.

 

1.           Subscriber’s Representations and Warranties. The Subscriber hereby represents and warrants to and agrees with the Company that:

 

(a)           Access to Information. The Subscriber acknowledges that he or she has been furnished with the Company’s Form 10-K for the year ended December 31, 2009 as filed with the Securities and Exchange Commission (the “Commission”) together with all subsequently filed Forms 10-Q, 8-K, and other publicly available filings made with the Commission (hereinafter referred to collectively as the
“Reports”) and has been afforded (i) the opportunity to ask such questions as he or she has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the Securities and the merits and risks of investing in the Company; (ii) access to information about the Company and its subsidiary and their respective financial condition, results of operations, business, properties, management and prospects sufficient to enable him or her to evaluate his or her investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment.
Neither such inquiries nor any other investigation conducted by or on behalf of the Subscriber or his or her representatives or counsel shall modify, amend or affect the Subscriber’s right to rely on the truth, accuracy and completeness of the Reports and the Company’s representations and warranties contained herein.

 

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(b)           Information on Subscriber. The Subscriber is and was not a “U.S. person,” as defined in Regulation S of the Securities Act of 1933, as amended (the “1933 Act”), and was outside the United States, at the time the offer or sale of the Securities was made. Additionally, the Subscriber is an “accredited investor,” as such term is defined in Regulation D of the 1933 Act or is part of a group that is experienced in investments and business matters, has made investments of a
speculative nature and has purchased securities of United States publicly-owned companies in private placements in the past and, with his or her representatives, has such knowledge and experience in financial, tax and other business matters as to enable the Subscriber to utilize the information made available by the Company, to evaluate the merits and risks of an investment in the Company and to make an informed investment decision with respect to the proposed purchase, which represents a speculative investment. This Agreement has been duly executed by the Subscriber and when delivered by the Subscriber in accordance with terms hereof, will constitute the valid and legally binding obligation of the Subscriber, enforceable against him or her in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally the enforcement of, creditors’ rights and remedies or by other equitable principles of general application. The Subscriber is able to bear the risk of such investment for an indefinite period and to afford a complete loss thereof. The information set forth on the signature page hereto regarding the Subscriber is accurate.

 

(c)           Purchase of Shares and Investment Intent. The Subscriber is purchasing the Shares for his or her own account for the Purchase Price. The Subscriber is acquiring the Shares as principal for his or her own account for investment purposes only and not with a view to or for distributing or reselling such Shares or any part thereof, without prejudice, however, to the Subscriber’s right at all times to sell or otherwise dispose of all or any part of such Shares in compliance with applicable federal and state securities laws. The Subscriber does not have any
agreement or understanding, directly or indirectly, with any person to distribute any of the Shares. The Subscriber also represents that the purchase of the Shares is intended to be made as an “Offshore Transaction” as defined in Regulation S.

 

(d)           Compliance with Securities Act. The Subscriber understands and agrees that the Shares have not been registered under the 1933 Act, by reason of their issuance in a transaction that does not require registration under the 1933 Act (based in part on the accuracy of the representations and warranties of the Subscriber contained herein), and that such Shares may not be offered or sold in the United States or to U.S. persons unless the Shares are registered under the 1933 Act or an exemption from the registration requirements of the 1933 Act is available.

 

(e)           Legend on Shares. The Shares shall bear the following legend (or something comparable for the Warrant), unless the Shares shall have been included in an effective registration statement under the 1933 Act:

 

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“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THESE SHARES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT REQUIRED.”

(f)           Communication of Offer. The offer to sell the Shares was directly communicated to the Subscriber. At no time was the Subscriber presented with or solicited by any leaflet, newspaper or magazine article, radio or television advertisement, or any other form of general advertising or solicited or invited to attend a promotional meeting otherwise than in connection and concurrently with such communicated offer.

 

(g)           Certain Trading Activities. The Subscriber has not directly or indirectly, nor has any person acting on behalf of or pursuant to any understanding with the Subscriber, engaged in any trading in any securities of the Company (including, without limitation, any Short Sales (defined below) involving the Company’s securities) during the 20 trading days immediately preceding the issuance of the Shares. For purposes of this Section, “Short
Sales” include, without limitation, all “short sales” as defined in Rule 3b-3 of the Securities Exchange Act of 1934, as amended (the “1934 Act”) and include all types of direct and indirect stock pledges, forward sale contracts, options, puts, calls, short sales, swaps and similar arrangements (including on a total return basis), and sales and other transactions through non-U.S. broker dealers or foreign regulated brokers having the effect of hedging the securities or investment made under this Agreement. As of the date of this Agreement, the Subscriber has no open short position in the Common Stock, and covenants that neither the Subscriber nor any person acting on his or her
behalf or pursuant to any understanding with him or her will engage in any Short Sales prior to the public disclosure of the material terms of this transaction by the Company. The Subscriber understands and acknowledges that he or she may not engage in any hedging transactions with respect to the Shares other than in compliance with the 1933 Act.

 

(h)           Correctness of Representations. The Subscriber represents that the foregoing representations and warranties are true and correct. The foregoing representations and warranties shall survive the date hereof.

 

2.           Company Representations and Warranties. The Company represents and warrants to and agrees with the Subscriber that:

 

(a)           Due Incorporation. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has the requisite corporate power to own its properties and to carry on its business as now being conducted. The Company is duly qualified as a foreign corporation to do business and is in good standing in each jurisdiction where the nature of the business conducted or property owned by it makes such qualification necessary, other than those jurisdictions in which the failure to so qualify would not have a material
adverse effect on the business, operations or financial condition of the Company.

 

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(b)           Outstanding Stock. All issued and outstanding shares of capital stock of the Company have been duly authorized and validly issued and are fully paid and non- assessable.

 

(c)           Authority; Enforceability. This Agreement has been duly authorized, executed and delivered by the Company and is a valid and binding agreement enforceable in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights generally and to general principles of equity; and the Company has full corporate power and authority necessary to enter into this Agreement and to perform its obligations hereunder.

 

(d)           Shares Duly Authorized. The Shares when issued and delivered in accordance with the terms of this Agreement, will be duly authorized, validly issued, fully paid and non-assessable.

 

(e)           Stop Transfer. The Shares are restricted securities as of the date of this Agreement. The Company will not issue any stop transfer order or other order impeding the sale, resale or delivery of the Stock, except as may be required by federal securities laws.

 

(f)           No General Solicitation. Neither the Company, nor any of its affiliates, nor to its knowledge, any person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation S or D under the 1933 Act) in connection with the offer or sale of the Shares.

 

3.           Regulation S Offering. This offering is being made pursuant to the exemption from the registration provisions of the 1933 Act afforded by Regulation S thereunder.

 

4.           Reissuance of Shares. The Company will cause the removal of the legend set forth in Section 1(e) above at such time as (a) the Subscriber is permitted to, and disposes of, the Shares pursuant to an exemption to the registration requirements of the 1933 Act or Rule 144 of the 1933 Act, in the opinion of counsel reasonably satisfactory to the Company, or (b) upon sale of the Shares pursuant to an effective registration statement under the 1933 Act. The Company agrees to cooperate with the Subscriber in connection with all sales pursuant to Rule 144 of the 1933 Act
and provide legal opinions necessary to allow such sales provided the Company and its counsel receive requested written representations from the Subscriber and selling broker, if any. The Company will pay for its costs in connection with the removal of the legend hereunder.

 

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5.           “Piggy-Back” Registration Rights.

 

(a)           The Company agrees that when it registers any Common Stock under the 1933 Act by registration on Form S-1 or other similar form for sale for the account of one or more holders of Common Stock, the Company will use its best efforts to register all or some portion of the Shares in such registration statement as the Company may reasonably determine feasible. The Company will pay all expenses incident to the registration of the Shares hereunder and the Company’s performance of or compliance with this Agreement.

 

(b)           The Seller will furnish to the Company in writing such information and representation letters with respect to itself and the proposed distribution by it as reasonably shall be necessary in order to assure compliance with federal and state securities laws.

 

6.           Fees and Expenses. Each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall pay all stamp and other taxes and duties levied in connection with the issuance of the Shares.

 

7.           Miscellaneous.

 

(a)           Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or
other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be: (i) if to the Company to Calypte Biomedical Corporation, 15875 SW 72nd Ave, Portland, Oregon 97224, facsimile number: (503) 601-6299,
and (ii) if to the Subscriber, to the name, address and facsimile number set forth on the signature page hereto.

 

(b)           Closing. The Company acknowledges receipt of the Purchase Price, which Subscriber has advanced in installments of $50,000, $80,000 and $50,000 on February 11, November 2 and December 10, 2010, respectively. Within a reasonable time following execution and delivery of this Agreement, the Company shall deliver the Shares to the Subscriber.

 

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(c)           Entire Agreement; Assignment. This Agreement represents the entire agreement between the parties hereto with respect to the subject matter hereof and may be amended only by a writing executed by both parties. No right or obligation of either party shall be assigned by that party without the written consent of the other party.

 

(d)            Execution. This Agreement may be executed in separate counterparts, each of which shall be deemed an original and both of which shall constitute one and the same document. This Agreement may be executed by facsimile transmission.

 

(e)           Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Oregon without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the state courts of Oregon or in the federal courts located in the state of Oregon. Both parties and the individuals executing this Agreement agree to submit to the jurisdiction of such courts and waive trial by jury. The prevailing party shall be entitled to
recover from the other party its reasonable attorney’s fees and costs. In the event that any provision of this Agreement or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement.

 

(f)           Specific Enforcement, Consent to Jurisdiction. The Company and the Subscriber acknowledge and agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent or cure breaches of the provisions of this Agreement and to enforce specifically the terms and provisions hereof or thereof, this being in addition to any other remedy to which any of
them may be entitled by law or equity. Subject to Section 7(e) hereof, each of the Company and the Subscriber hereby waives, and agrees not to assert in any such suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such court, that the suit, action or proceeding is brought in an inconvenient forum or that the venue of the suit, action or proceeding is improper. Nothing in this Section shall affect or limit any right to serve process in any other manner permitted by law.

 

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IN WITNESS WHEREOF, the parties have hereby executed this Agreement as of the day set forth in the acceptance set forth below.

 

	6,000,000	 	
SUBSCRIBER NAME:

	
Number of Shares

	 	
 

	 	 	 
	
$180,000 

	 	 
	
Dollar Amount of Subscription Tendered by Subscriber

	 	
Carolina Lupascu

	 	 	 
	 	 	
Street Address

	 	 	 
	 	 	
City and Country

	 	 	 
	 	 	
Telephone Number

ACCEPTANCE

The foregoing subscription is hereby accepted, subject to the terms and conditions hereof, as of _______________, 2011.

 

	$180,000	 	CALYPTE BIOMEDICAL CORPORATION
	
Amount of Subscription Accepted

	 	 
	 	 	 
	6,000,000	By: 	 
	
Number of Shares

	 	Name: Adel Karas
	 	 	Title: Chief Executive Officer
	 	 	 

 

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7dais_ex101.htm

EXHIBIT 10.1

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into as of the 14th day of September 2011 (“Effective Date”) by and between Dais Analytic Corporation, a New York Corporation (“Company”), and Timothy N. Tangredi (“Executive”).

 

RECITALS

WHEREAS, Executive entered into an employment agreement with Company dated May 23, 2011(the “2011 Agreement”); and

WHEREAS Company and Executive desire to amend and restate the 2011 Agreement to reflect such changes as hereinafter provided; and

WHEREAS, the Executive and Company wish to continue Executive’s employment with the Company on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the premises and mutual promises and agreement hereinafter set forth, it is agreed as follows:

 

Article 1 Employment

 

	
1.1.  

	
Employment.  Company hereby employs Executive, and Executive hereby accepts such employment from Company, on the terms and conditions set forth in this Agreement.

 

	
1.2.  

	
Term.  Subject to the provisions for termination and extension as hereinafter provided, the term (the “Term”) of this Agreement shall commence on September 14, 2011 (the “Commencement Date”) and shall continue until the third anniversary thereof.

 

	
1.3.  

	
Automatic Renewal.  The Term shall automatically be extended on the second anniversary of the Commencement Date for an additional two years, and on each subsequent anniversary of the Commencement Date thereafter for an additional one year, unless in any such case either Executive or Company delivers, at least one hundred and eighty days before such anniversary of the Commencement Date, written notice to the other party of his or its intent not to renew or extend the Term.

 

	
1.4.  

	
Termination of Existing Agreement.  Effective upon the close of business on the day prior to the Commencement Date, any employment agreement by and between Company and Executive which predates the Commencement Date is hereby terminated, except that any rights and obligations which accrue or otherwise arise prior to the Commencement Date under any such agreement shall continue to be enforceable.

 

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Article 2 Duties

	
2.1.  

	
Position.  Executive will continue to serve as the President and Chief Executive Officer of Company during the Term of this Agreement, and his duties hereunder in such position shall be as set forth in the By-Laws of the Company. Any material diminution in the powers, duties and authorities of Executive set forth in the By-Laws shall not be effected without the prior written consent of the Executive. Executive will devote substantially all of his professional time during regular business hours to the Company’s business, except that Executive will be permitted to perform charitable work and to manage his personal and other business investments so long
as such outside activities do not interfere with the performance of Executive’s duties on behalf of Company.

	
2.2.  

	
Location.   Executive shall be employed at the Company’s principal offices located in Odessa, Florida, subject to necessary travel on Company business as determined by the Executive. The Company’s principal offices shall not be moved to a location that is more than 50 miles from the Company’s current principal offices without the Executive’s prior written consent.

	
2.3.  

	
Directorships; Position with Subsidiaries.  During the Term of this Agreement, the Board of Directors of the Company shall use its best efforts to cause Executive to continue to be elected as a Director of the Company. Such best efforts shall include, but not be limited to, nominating Executive as part of the management slate of directors to be elected by the shareholders of the Company, endorsing the election of Executive as a director and soliciting proxies for the election of Executive. In addition, at Executive’s request, the Company shall have Executive elected to the Board of Directors of each of its subsidiaries, or Joint Ventures.

Article 3 Compensation and Benefits

 

	
3.1.  

	
Salary and Bonus.  Subject to the terms and conditions set forth below, Executive will receive the following compensation for his services during his Term of employment (beginning on the Commencement Date)

	
a.  

	
Base Salary.  Subject to the terms and conditions of this Agreement, from and after the Commencement Date the Executive shall receive a base salary of $200,000 per annum or such higher sum, as the Board of Directors shall set. The base salary, as in effect from time to time during the Term of this Agreement, shall hereinafter be referred to as the “Base Salary”. The Base Salary shall be increased, if applicable, on each anniversary of this Agreement, or on the same day in each year of the Term as the Board of Directors and Executive may agree in writing (“Determination Date”), to a sum equal to the Base Salary then in effect plus
the Base Salary then in effect times the multiplier determined for that year (“Multiplier”).

 

For the purpose of this Agreement, a “Multiplier” shall be calculated for each year of the Term and shall be equal to the number secured by subtracting from the total revenue of the Company for the one year period ending on the Determination Date of the applicable year (“Current Year”) the total revenue of the Company for the one year period immediately preceding the Current Year (“Prior Year Revenue”), dividing the result by the Prior Year Revenue, and further dividing the resulting quotient by three (3). Notwithstanding the foregoing, in no year of this Agreement may the adjustment to the Base Salary calculated hereunder for a particular year exceed fifty percent (50%)
of the prior year Base Salary.

 

In the event Company sells or otherwise transfers one or more of its revenue producing assets or business lines in a given year, then any revenue attributable to that asset or business line shall be excluded from the Prior Year Revenue for the purpose of determining the Multiplier for year in which the sale or transfer was made as well as for the following year.

 

Notwithstanding the foregoing, the Base Salary then in effect shall be reviewed by the Board of Directors not less frequently than annually and may be further increased by the Board in its discretion from time to time but may not be decreased without the Executive’s prior written consent. The Base Salary in effect shall be payable in accordance with the Company’s customary payroll practices.  For the purpose of Article 3 the term “Board of Directors” shall mean all independent members of the Board of Directors of the Company or, if the Board has appointed a Compensation Committee, such Committee.

 

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b.  

	
Bonus.  Executive shall be eligible to receive an annual bonus, of up to 100% of the Executive’s then effective Base Salary, should the Executive meet or exceed certain annual performance goals established by Board of Directors and communicated in writing to Executive on the date of this Agreement (or such other date as the Company and Executive shall agree in writing) and on each anniversary thereafter.   This bonus is payable annually, at the option of the Executive, in cash, stock, restricted stock, or options valued in accordance with generally accepted accounting principles.

	
c.  

	
Merit Bonus. The above notwithstanding the Board of Directors may also provide the Executive with a merit bonus (“Merit Bonus”) commensurate with the Company’s overall large success, sale of a division, major license or distribution arrangement, merger, or any such extraordinary event. The Merit Bonus can be payable, at the option of the Board of Directors, in cash, stock, restricted stock, or options valued according to generally accepted accounting principles. Any bonus granted pursuant to this Section 3.1(c) shall be paid to the Executive no later than the next regularly scheduled Company payroll date.

	
d.  

	
 Options.

	
(i)  

	
Immediately following the closing of a secondary public offering (“Closing”) of the Company’s Common Stock (“Grant Date”), in addition to any other compensation which he may receive hereunder, Executive shall be granted an option to purchase Five Hundred and Twenty Thousand (520,000) shares of the Company’s Common Stock. The option shall be exercisable during its term in one third increments with 173,333 shares vesting on the Grant Date, 173,333 shares vesting on the first anniversary of the Grant Date and all remaining shares vesting on the second anniversary of the Grant Date. Said option shall be exercisable at a price equal to the Fair Market Value per share of the stock on the Grant Date.
Such options shall be granted under the Company’s  2009 Long Term Incentive Plan , have a term of ten years, be exercisable for up to three years after termination of employment by Executive with the Company (unless termination is for Cause, as hereinafter defined, in which event they shall expire on the date of termination), have a “cashless” exercise feature, and be subject to such additional terms and conditions as are then applicable to options granted under such plan provided they do not conflict with the terms set forth herein. For purposes hereof, “Fair Market Value” means (A) during such time as the Common Stock is registered under Section 12 of the Exchange Act, the closing price of the Common Stock as reported by an established stock exchange or automated quotation system on the
day for which such value is to be determined, or, if no sale of the Common Stock shall have been made on any such stock exchange or automated quotation system that day, on the next preceding day on which there was a sale of such Common Stock, or (B) during any such time as the Common Stock is not listed upon an established stock exchange or automated quotation system, the mean between dealer “bid” and “ask” prices of the Common Stock in the over-the-counter market on the day for which such value is to be determined, or (C) during any such time as the Common Stock cannot be valued pursuant to (A) or (B) above, the fair market value shall be as determined by the Board considering all relevant information including, by example and not by limitation, the services of an independent appraiser.

	
(ii)  

	
In addition to the foregoing, Executive shall be entitled to participate in the Company’s incentive plans including, but not limited to, Company’s 2009 Long-Term Incentive. Any options granted to Executive during the Term shall be immediately exercisable, have a term of ten years, shall be exercisable for up to three years after termination of employment by Executive with the Company to (unless termination is for Cause, as hereinafter defined, in which event they shall expire pursuant to the provisions of the respective plan under which the option is issued), shall have a “cashless” exercise feature, and shall be subject to such additional terms and conditions as are then applicable to options granted
under such plan provided they do not conflict with the terms set forth herein. The “Date of Grant” of any option granted pursuant to this Section 3.1 (c) or 3.1 (d) (ii) shall be determined as provided by the terms of the plan under which the option is granted.

 

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3.2.  

	
Benefits. Executive shall receive the following benefits during the Term of this Agreement:

 

	
a.  

	
Health Benefits.  Medical, hospital, surgical, vision, dental, long and short term disability, accidental death and/or travel insurance coverage (collectively “Health Benefits”), as generally offered and made available to other executive officers of the Company and to the extent Executive’s age, health or other qualifications make him eligible to participate, except that the Executive shall not be required to pay any amounts toward the premiums therefore. In the event that the Company does not offer all or any portion of Health Benefits to executive officers of the Company, then Company shall reimburse Executive for the premium costs of
Health Benefits.

 

	
b.  

	
Vacation.  Executive shall receive four weeks of paid vacation, and ten personal days per year. At Executive’s option, any accrued but unused vacation or personal days at the end of a calendar year shall be payable in cash or carried over to the following years at the Executive’s election. All unused vacation may be carried  for whatever time the Executive wishes, and paid on termination.

 

	
c.  

	
Life Insurance.  The Company shall provide term life insurance on the life of the Executive, at the Executive’s election, in an amount equal to 300% of the Base Salary then in effect. The beneficiary or beneficiaries of said insurance shall be as designated in writing to the Company by Executive, and the owner of the policy shall be the Executive or his assigns. The Company shall pay all the premiums payable on such insurance and any applicable federal and local income taxes as a result of such payment.

 

	
d.  

	
Reimbursement of Expenses.  Executive shall be reimbursed for all ordinary and reasonable business expenses incurred in accordance with Company’s policies and customary practices. This includes reimbursement of up to $7,500 for one executive conference or educational venue of the Executive’s choosing.

 

	
e.  

	
Transportation Allowance.  In addition to expenses reimbursable pursuant to paragraph (d) above, the Company shall provide Executive with an automobile allowance of $800 per month during the Term of this Agreement, and the Company shall reimburse Executive for the cost of insurance, repairs, gas, tolls, and maintenance associated with Executive’s automobile as well as the costs of a mobile phone for the Executive’s use.

 

	
f.  

	
Other  Benefits.  In addition to the benefits specifically set forth above in this Section 3.2, Executive shall be entitled to participate during the Term in all employee benefit plans, including but not limited to the Company’s incentive compensation plan, which may be made available at the date hereof or in the future by the Company to employees serving the Company or its subsidiaries in an executive capacity. Benefits for Executive under such plans shall be at least as great as those offered to any other employee of the Company or any of its subsidiaries but any option grant under said benefit plans shall be subject to the same terms as
those of Section 3.2 (a) with the exception that the Date of Grant shall be the date set by the Board of Directors for said grant.

 

	
g.  

	
Modification of Section 3.1.  Prior to December 31, 2011 the Board of Directors shall retain the services of an independent compensation benefits consulting firm (“Consulting Firm”), acceptable to the Board of Directors to develop and recommend to Company a compensation plan for Executive as part of a plan for all executives of the Company (“Plan”). The Plan shall be take into consideration compensation provided to executives in similar positions at similar companies within one year of the Plan date and shall contain compensation recommendations for Executive comparable to such plans. The Plan shall be completed no later than
January 31, 2012 and shall be provided to the Executive and Board of Directors in writing by the Consulting Firm. At Executive’s option, Company and Executive shall amend this Agreement to incorporate the compensation, terms and conditions of the Plan, provided the terms and conditions of the Plan shall be modified, if necessary, to comply with any and all State or Federal laws and regulations. In the event the majority of independent members of the Board of Directors determine the Plan or any provisions suggested to incorporate the Plan into this Agreement to be unacceptable, said members of the Board of Directors and the Executive shall attempt to negotiate a mutually acceptable resolution that, if reached, shall be incorporated into Section 3.1 of this Agreement.  In the event such parties are not able to reach a negotiated resolution within thirty (30) days of the
commencement of the negotiations, or such longer period as the parties may agree in writing, the Executive may opt to continue with this Agreement without any modifications of any nature or terminate this Agreement and, if the Agreement is terminated, the Executive, in addition to any other rights he may have under this Agreement, shall be entitled to the same severance pay and other benefits of Section 4.4 (a) provided, in this instance only, the cash payment due under Section 4.4 (a) shall be $200,000 and all other provisions of Section 4.4 (a) shall remain unchanged.

 

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Article 4 Termination.

 

	
4.1.  

	
Termination of Employment.  The Term of employment shall terminate prior to the end of the period of time specified in Section 1 immediately upon:

 

	
a.  

	
the death of Executive;

 

	
b.  

	
the election of the Company in the event of Executive’s Disability (as defined below) during the Term of employment;

 

	
c.  

	
the election of the Company for Cause (defined below);

 

	
d.  

	
the election of the Company without Cause;

 

	
e.  

	
the resignation of Executive for Good Reason (as defined below);

 

	
f.  

	
the resignation of Executive without Good Reason; or

 

	
g.  

	
the resignation of Executive within one year following a Change in Control of the Company (as defined below).

 

	
4.2.  

	
Procedure.  The decision to terminate Executive pursuant to (b), (c) or (d) shall require the affirmative vote of sixty-six and two third percent (66 2/3rd %) of the disinterested directors of the Board.  In the event that Executive’s employment is terminated as described in 4.1 (a) through (g) above, the Company shall have no further obligation to Executive hereunder except to pay to Executive (or his estate, as the case may be), within ten days following the date of termination, his accrued but unpaid Base Salary, bonus and accrued vacation pay, less standard
withholdings for tax and social security purposes, plus any unreimbursed expenses, except that in the cases of Section 4(a), (b), (d), (e) and (g), Executive shall also be entitled in addition to receive the compensation or other benefits provided in this Article 4.

 

	
4.3.  

	
Definitions.

 

	
a.  

	
“Good Reason” means either (i) a material breach by Company of this Agreement that Company fails to cure within twenty days after receiving written notice from Executive of such breach or (ii) Company’s failure to pay any compensation due and owing to Executive within ten days after receiving written notice from Executive that such payment is due.

 

	
b.  

	
“Cause” means:

 

	Page 5 of 12	September 2011

  

 

  

 

	
(i)  

	
a material breach by Executive of this Agreement that Executive fails to cure within thirty days after receiving  written notice from Company of such breach;

 

	
(ii)  

	
Executive’s failure to follow reasonable, lawful orders or directions of the Board, after Executive has been given written notice of his default and has not followed such lawful orders or directions of the Board within thirty days of receiving such notice;

 

	
(iii)  

	
Executive’s willful misconduct, dishonesty or reckless disregard of his responsibilities to Company, after Executive has been given written notice of his default and has not cured such conduct within thirty days of receiving such notice;

 

	
(iv)  

	
Executive’s conviction or plea of nolo contendere or the equivalent in respect of either a felony or a misdemeanor involving moral turpitude but excluding, in any event, vehicular infractions; or

 

	
(v)  

	
Executive’s material violation of any written major Company policy previously communicated to Executive, after Executive has been given written notice of his default and has not cured such violation within thirty days of receiving such notice.

 

	
c.  

	
“Disability” means a physical or mental illness, injury or condition that prevents Executive from performing his essential duties under this Agreement, even with reasonable accommodation, for at least ninety consecutive calendar days or for at least one hundred and twenty calendar days, whether or not consecutive, in any one hundred and eighty calendar day period.

 

	
d.  

	
“Change in Control of the Company” shall be deemed to have occurred if any one of the following occurs:

 

	
(i)  

	
The acquisition by an individual, a group of individuals, entity or group of 33% or more of either the then outstanding shares of Common Stock or the combined voting power of the voting securities of the Company having general voting power in electing the Board of Directors of the Company;

 

	
(ii)  

	
Individuals who, as of the date hereof, constitute the Board of Directors of the Company (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board of the Directors; or

 

	
(iii)  

	
approval by the stockholders of the Company of a complete liquidation or dissolution of the Company or of the sale or other disposition of all or substantially all of the assets of the Company, or of a reorganization, merger or consolidation with respect to which the individuals and entities who were the respective beneficial owners of the outstanding Common Stock and voting securities of the Company immediately prior to such reorganization, merger or consolidation do not, immediately following such reorganization, merger or consolidation, beneficially own, directly or indirectly, more than 50% of, respectively, the then outstanding shares of Common Stock and the combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors of the entity resulting from such reorganization, merger or consolidation, as the case may be.

 

	Page 6 of 12	September 2011

  

 

  

 

	
4.4.  

	
Severance Pay and Other Benefits Upon Termination In Certain Circumstances.

 

	
a.  

	
Termination By Company Due to Disability, Termination by Company Without Cause, or Resignation By Executive for Good Reason. In the event Executive’s employment is terminated by the Company under section 4.1(b) or (d) or the Executive resigns for Good Reason under section 4.1(e), the Executive shall be entitled to the following:

 

	
(i)  

	
Severance Pay.  The Company shall pay to Executive within ten days after such termination or resignation an amount equal to the sum of:

 

	
(A.)  

	
the greater of 150% of the Base Salary then in effect for Executive or $320,000,  plus

 

	
(B.)  

	
the cash and equity (options, stock and/or restricted stock) bonuses, if any, awarded to Executive for the most recent year pursuant to Article 3 hereof;

 

	
(ii)  

	
Continuation of Benefits.  Company shall continue to provide Executive the benefits set forth in Section 3.2 of this Agreement until two years following termination of Executive’s employment, and shall continue to offer any of such benefits to Executive beyond such two year period to the extent required by COBRA or similar statute which may then be in effect;

 

	
(iii)  

	
Vesting of Options.   All stock options, to the extent they were not exercisable at the time of termination of employment, shall become exercisable in full;

 

	
b.  

	
Death.  In the event of termination of employment as a result of the death of Executive, the provisions of (a) (i) and (a) (iii) of this Section 4.4 shall also be applicable.  Additionally, (i) all incentive stock options awarded to Executive, to the extent not previously exercised, may be exercisable, at the option of Executive’s estate during the one year period commencing on the death of the Executive, and (ii) all non qualified stock options may be exercisable, at the option of Executive’s estate during remaining life of the option.

 

	
c.  

	
Change in Control of the Company.  In the event that Executive elects to resign from employment under Section 4.1(g) of this agreement, he shall be entitled to the following:

 

	
(i)  

	
Severance Pay.  The Company shall pay to Executive within the later of ten days following the date on which the Change in Control occurs or the date on which he gives notice of his election to resign from employment a lump-sum payment equal to the sum of:

 

	
(A.)  

	
the greater of the Base Salary then in effect for Executive or $210,000 plus

 

	
(B.)  

	
the Bonus and Merit Bonus if any, awarded to Executive for the most recent year pursuant to Article 3 hereof.

 

	
(ii)  

	
In addition, the provisions of (a) (ii) and (a) (iii) of this Section 4.4 shall also be applicable.

 

	Page 7 of 12	September 2011

  

 

  

 

Article 5 Intellectual Property

 

	
5.1.  

	
Intellectual Property.  Any and all intellectual property right, title and interest in works created or generated by Executive, whether alone or with others, during the Term within the scope of his employment, vests exclusively in, and will be the property of, the Company. Works shall be considered within the scope of the Executive’s employment where the works (i) are created in whole or in part within the confines of Company’s facilities during business hours or (ii) are created in whole or in part using Company facilities, materials, processes, equipment or supplies, where such intellectual property works reasonably relate to Company’s
actual or intended business. Executive will execute any reasonable documents necessary to transfer any such intellectual property to Company, including, at Company’s expense, all patent applications and any continuations, continuations in part, divisional, reexaminations, reissues or foreign counterparts thereof.

Article 6 Non-Competition; Non-Solicitation; Confidentiality

 

	
6.1.  

	
Non-Competition.  Executive agrees that (a) during the Term of this Agreement and (b) for a period of two years after termination of Executive’s employment with the Company for any reason, Executive will not, without the prior written consent of Company, directly or indirectly, have an interest in, be employed by or be connected with, as an Executive, consultant, officer, director, partner, member, stockholder or joint venture, any person or entity owning, managing, controlling, operating or otherwise participating or assisting in any business that is in competition with Company’s applications of its core nanotechnology materials as of the date
of termination of this Agreement. This does not preclude the Executive from pursuing healthcare related uses of any nanotechnology materials. Notwithstanding the foregoing, Executive’s ownership of greater than five percent (5%) of the issued and outstanding securities of any class of a corporation listed on a national securities exchange or designated as national market system securities on an inter-dealer quotation system shall not be a violation of this Agreement.

 

	
6.2.  

	
Non-Solicitation.  Executive agrees that (a) upon termination of Executive’s employment with the Company for any reason and (b) for a period of one year thereafter, Executive will not solicit or hire any person employed by Company at any time. The foregoing restriction shall not apply to any Company employee whose annual salary is less than $75,000 or who has ceased to be employed by Company for at least six months.

 

	
6.3.  

	
Confidentiality.

	
a.  

	
Except as may be required to be disclosed by Executive under applicable law (including any applicable judicial or governmental regulation, directive, requirement or order) and except as required in connection with the performance of his duties under this Agreement, Executive shall keep confidential and shall not disclose, directly or indirectly, to any other person (other than to Company’s other employees and/or agents in connection with such party’s performance of its obligations to Company) any Confidential Information (defined below), and shall not use for his personal benefit or for that of any other person any Confidential Information. This Section 6.3 shall not apply to Company information which: (i) Executive
knows at the time of disclosure, free of any obligation to keep it confidential as evidenced by written records; (ii) at the time of disclosure is in the public domain; (iii) is disclosed to Executive by a third party that did not acquire such information under any obligation of confidence; (iv) is required to be disclosed by any court of competent jurisdiction provided that prior written notice of such disclosure is afforded to Company; (v) is or becomes generally available to the public through no fault of Executive.

 

	Page 8 of 12	September 2011

  

 

  

	
b.  

	
For purposes of this Agreement, the term “Confidential Information” means trade secrets, discoveries, ideas, concepts, know-how, techniques, designs, specifications, drawings, diagrams, data, computer programs, business activities and operations, budgets, salaries, financial statements, prices, costs and other business information of or relating to Company or any subsidiaries of Company that may be created or provided to Executive by Company during the Term of this Agreement.

	
c.  

	
Upon the termination of Executive’s employment for any reason whatsoever, Executive shall deliver to Company all tangible materials embodying the Confidential Information, including any documentation, records, listings, notes, data, sketches, drawings, memoranda, models, accounts, reference materials, samples, machine-readable media and equipment which in any way relate to the Confidential Information. Executive shall not retain any copies of any of the above materials.

	
6.4.  

	
Injunctive Relief.  Executive acknowledges that he has substantial knowledge and expertise in, and personal relationships affecting, the operations, business contacts, trade secrets, customer lists, marketing, business strategies and processes and other confidential matters of critical significance to the conduct of the Company’s business and its future prospects. Executive, therefore, agrees and consents that, in addition to any other remedies that may be available to Company, Company shall be entitled to specific performance by temporary as well as permanent injunction to prevent a breach or contemplated breach by Executive of any of the covenants
or agreements in Sections 6.1, 6.2 or 6.3.

Article 7 Indemnification

	
7.1.  

	
Indemnification.  During the term of this Agreement, and subsequent thereto with respect to any claim arising out of or in connection with his employment with the Company or any subsidiary of the Company, the Company shall indemnify and hold Executive harmless from all claims and liability, loss or damage (including but not limited to judgments, fines and amounts paid in settlement), asserted against Executive or incurred by Executive, including reasonable attorneys fees and costs of investigation (the “Indemnification”). The Indemnification provided for herein shall be in addition to and not in substitution of any and all rights to
indemnification which Executive may be entitled to under the laws of the State of Florida or the Certificate of Incorporation and By-laws of the Company. To the extent permitted under the laws of the State of Florida, and the Company’s Certificate of Incorporation and By-Laws, all expenses, including reasonable attorneys fees, incurred by Executive in defending any civil, criminal, administrative or investigative action, shall upon request by Executive, be paid and advanced by the Company in advance of the final disposition of such action, suit or proceeding.

	
7.2.  

	
Director and Officers Liability Insurance. During the Term, unless the Executive otherwise consents, the Company will maintain directors’ and officers’ liability insurance in an amount not less than $5,000,000, and Executive shall at all times be one of the named insured under such coverage.

 

	Page 9 of 12	September 2011

  

 

  

Article 8 Miscellaneous.

	
8.1.  

	
Governing Law.  New York without regard to the conflicts of laws principles thereof shall govern this Agreement.

	
8.2.  

	
Non-Contravention.  Executive represents and warrants that the execution, delivery and performance of this Agreement do not and will not contravene, conflict with or otherwise violate the terms of any written or oral agreement among Executive and one or more third parties.

	
8.3.  

	
Arbitration.  Disputes between the parties arising under or with respect to this Agreement shall be submitted to arbitration in Hillsborough County, Florida by a single arbitrator under the rules of the American Arbitration Association, and the arbitration award shall be binding upon the parties and enforceable in any court of competent jurisdiction. The cost of arbitration, including counsel fees, shall be borne by the Company unless the arbitrator determines that the Executive’s position was frivolous and without reasonable foundation.

	
8.4.  

	
Notices.  Any notice or communication to be given under the terms of this Agreement shall be in writing and delivered in person or deposited, certified or registered, in the United States mail, postage prepaid, addressed as follows:

 

	 	If Company:  	Dais Analytic Corporation 	If Executive:  	Mr. Timothy N. Tangredi
	 	 	11552 Prosperous Drive 	 	10416 Pontofino Circle
	 	 	Odessa, Florida 33556	 	Trinity, FL 34655
	 	 	Attn: Board of Directors	 	 

 

or at such other address as either party may from time to time designate by notice hereunder. Notices shall be effective upon delivery in person or, if mailed, at midnight on the third business day after the date of mailing.

	
8.5.  

	
Modifications and Amendments.  This Agreement shall not be modified, altered or amended except by a written agreement signed by the parties hereto.

	
8.6.  

	
Entire Agreement.  This Agreement together with the documents referred to herein or contemplated hereby constitute and embody the full and complete understanding and agreement of the parties hereto with respect to the subject matter hereof and supersede all prior understandings or agreements whether oral or in writing with respect to the subject matter hereof.

	
8.7.  

	
Benefit and Binding Effect.  This Agreement shall be binding upon and inure to the benefit of Company and its successors and assigns, including any corporation, person or other entity which may acquire all or substantially all of the business of Company or any other corporation with or into which Company is consolidated or merged, and Executive and his heirs, executors, administrators and legal representatives, provided, however, that the obligations of Executive hereunder may not be delegated or assigned.

 

	Page 10 of 12	September 2011

  

 

  

	
8.8.  

	
Severability.  If any portion of this Agreement may be held to be invalid or unenforceable for any reason whatsoever, it is agreed that said invalidity or unenforceability shall not affect the other portions of this Agreement and that the remaining covenants, terms and conditions, or portions thereof, shall remain in full force and effect, and any court of competent jurisdiction may so modify the objectionable provisions as to make it valid, reasonable and enforceable

	
8.9.  

	
Headings; Interpretation.  The section headings used herein are for convenience and reference only and are not intended to define, limit or describe the scope or intent of any provision of this Agreement. When used in this Agreement, the term “including” shall mean without limitation by reason of enumeration. Words used herein in the singular shall include the plural.

	
8.10.  

	
Waiver.  The failure of either party to insist, in any one or more instances, upon strict performance of any of the terms or conditions of this Agreement shall not be construed as a waiver or a relinquishment of any right granted hereunder or of the future performance of any such term, covenant or condition, but the obligations of either party with respect thereto shall continue in full force and effect.

	
8.11.  

	
Counterparts.   This Agreement may be executed in any number of counterparts, each of whom shall be deemed a duplicate original.

 

(Signature Page Follows)

 

 

 

	Page 11 of 12	September 2011

  

 

  

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

 

	EXECUTIVE:  	 	 	DAIS ANALYTIC CORPORATION	 
	
/s/ Timothy N. Tangredi  

	 	 	By:	
/s/ Robert W. Schwartz

	 
	Timothy N. Tangredi   	 	 	 	Robert W. Schwartz	 
	 	 	 	 	Member – Board of Directors	 

 

 

 

 

 

	Page 12 of 12	September 2011

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