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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-KSB
(Mark One)
[X] Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 (Fee Required) for the fiscal year ended December 31, 1996
[ ] Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (No Fee Required)
Pollution Research and Control Corp.
(Name of Small Business Issuer as Specified in its Charter)
California 95-2746949
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
506 Paula Avenue, Glendale, California 91201
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(Address of Principal Executive Offices) (Zip Code)
Small Business Issuer's telephone number, including area code (818) 247-7601
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, no par value
(Title of Class)
Check whether the Small Business Issuer (1) has filed all reports required to be
filed by Section 13 of 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the Small Business Issuer
was required to file such reports), and (2) has been subject to such filing
requirements of the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-B is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of the Form 10-KSB or any amendment to
this Form 10-KSB [X].
Small Business Issuer's revenues for its most recent fiscal year: $ 8,805,011
The aggregate market value of the voting stock held by non-affiliates of the
Small Business Issuer, computed by reference to the average bid and asked prices
of such stock on March 24, 1997 was $ 5,300,000.
Total number of pages - Exhibit Index is located at Page E-1
DOCUMENTS INCORPORATED BY REFERENCE:
Certain exhibits to this Annual Report as set forth in the Exhibit Index
located at page E-1.
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POLLUTION RESEARCH AND CONTROL CORP.
Form 10-KSB
For the Fiscal Year Ended December 31, 1996
TABLE OF CONTENTS
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Part I Page
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Item 1. Description of Business 4
General 4
History of the Company 4
The Air Pollution Industry 6
Instrument Market 7
Control Market 8
Governmental Approval 8
Governmental Regulation and Enforcement 9
Company Products 9
Marketing and Sales; Backlog 11
Foreign Sales 11
Manufacturing and Purchasing 12
Research and Development 12
Employees 13
Competition 13
Intellectual Property 14
Item 2. Description of Properties 14
Item 3. Legal Proceedings 14
Item 4. Submission of Matters to a Vote of Security Holders 15
Part II.
Item 5. Market for Common Equity and Related Stockholder
Matters 15
Item 6. Management's Discussion and Analysis or Plan of
Operation 15
Liquidity and Capital Resources 16
Seasonality 17
Item 7. Financial Statements F-1 - F-19
Item 8. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosures 17
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TABLE OF CONTENTS
(continued)
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Part III Page
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Item 9. Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act 17
Directors, Executive Officers and Key Employees 17
Family Relationships 18
Business Experience 18
Compliance with Section 16(a) of the Securities
Exchange Act of 1934 20
Item 10. Executive Compensation 21
Executive Compensation 21
Compensation of Directors 21
Employees' Incentive Stock Option Plan 21
Employment Agreements 21
Item 11. Security Ownership of Certain Beneficial Owners and
Management 22
Item 12. Certain Relationships and Related Transactions 24
Item 13. Exhibits and Reports on Form 8-KA
(a) Exhibits 24
(b) Reports on Form 8-KA 24
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ITEM 1. DESCRIPTION OF BUSINESS
GENERAL
The Company in its "core business" of over twenty years primarily
designs, manufactures and markets automated continuous monitoring instruments
used to detect and measure various types of air pollution, such as "acid rain,"
"ozone depletion" and "smog episodes," through its wholly-owned subsidiary,
Dasibi Environmental Corp. The Company's products are generally used to measure
air pollution levels in geographic areas which range in size from small
industrial sites to entire states or countries. The Company also supplies
computer-controlled calibration systems that verify the accuracy of its
instruments, data loggers to collect and manage pollutant information and final
reporting software for remote centralized applications, which is classified as
"core business related."
Because the Company has accumulated Air Pollution Technology (see
"History of the Company" below) and because severe competitive price pressures
in its core business have developed (see "History of the Company" below), the
Company has diversified uses of its technology to medical instrumentation which
measures air pollutants for medical diagnostics and to control applications to
eliminate or reduce the air pollutants measured in its "core business." (See
"Instrumentation Market" and "Control Market" below).
HISTORY OF THE COMPANY
The Company was organized as a California corporation on December 24,
1971, under the name of "A.E. Gosselin Engineering, Inc." as a wholly-owned
subsidiary of "Pollution Research and Control Corp." ("PRCC"), a California
corporation co-founded in 1966 by Albert E. Gosselin, Jr., the Company's
President and Chief Executive Officer, and his wife, Barbara Gosselin, an
executive officer and director of the Company. Mr. Gosselin founded the Company
to design, manufacture and market air pollution monitoring equipment for ambient
air (i.e., the surrounding air) as distinguished from the customer stack source
monitoring systems then being designed, manufactured and sold by PRCC. The name
of the Company was changed to "Dasibi Environmental Corp." on March 22, 1973.
(See Item 9. "Directors, Executive Officers, Promoters and Control Person;
Compliance with Section 16(a) of the Exchange Act - Directors, Executive
Officers and Key Employees.")
The Company was operated as a wholly-owned subsidiary of PRCC until its
initial public offering of securities in May 1985. In 1984, PRCC discontinued
its research and development activities and assigned them to the Company. From
1984 through May 1985, PRCC acted primarily as a holding company for the Company
and Applied Conservation Technology, Inc. ("ACT"), then a wholly-owned
subsidiary of PRCC engaged in the business of providing environmental impact
reports to electric utilities. ACT was purchased by its management from PRCC in
November 1986. Gary Dudley, a director and former Vice President of the Company
and a former executive officer and director of PRCC, has been the President and
a principal shareholder of ACT, a diversified environmental consulting firm now
located in Westminster, California, since November 1986. (See Item 9.
"Directors, Executive Officers, Promoters and Control Persons; Compliance with
Section 16(a) of the Exchange Act - Directors, Executive Officers and Key
Employees.")
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In May 1985, the Company received aggregate net proceeds in the amount
of $514,000 from a public offering of 150,000 Units, each Unit consisting of two
shares of Common Stock and one warrant exercisable to purchase one share of
Common Stock at an exercise price of $3.00 per share ("Common Stock Purchase
Warrant"). As a result of this offering, PRCC's ownership of the Company was
reduced to 88.2%. All Common Stock Purchase Warrants issued in this offering
expired unexercised in May 1986. As a result of a six-for-100 "dividend-in-kind"
of a portion of PRCC's shares of the Company's Common Stock to its shareholders
in November 1985, PRCC's ownership of the Company was further reduced to 81%. In
October 1986, PRCC distributed the remainder of its shares of the Company to the
shareholders of PRCC in a 70 for 100 distribution. There is currently no
relationship, business or otherwise, between the Company or its management and
PRCC, which is now known as "McMartin Industries, Inc."
The Company received net proceeds aggregating approximately $1,979,000
from a public offering of 1,453,497 Units, each Unit consisting of one share of
Common Stock and one warrant exercisable to purchase one share of Common Stock
at an exercise price of $1.75 per share, completed in July 1989. In October
1995, these warrants were extended to March 29, 1996. In February 1996, the
warrant exercise price was decreased to $0.60 and the warrants expiration date
was unchanged. By March 30, 1996, 266,900 warrants had been exercised and
1,944,097 expired.
The Company changed its name to "Pollution Research and Control Corp.,"
the name of its former parent, PRCC, in November 1989. In January 1990, the
Company acquired all of the issued and outstanding shares of Common Stock, $1.00
par value per share, of an inactive California corporation, organized by Mr. And
Mrs. Gosselin as co-founders under the name of "Baral Engineering, Inc." in July
1976, which changed its name to "Dasibi Environmental Corp." ("Dasibi") in
January 1990. All of the Company's operations were transferred to Dasibi
subsequent to the acquisition. Also in 1990, the Company changed its fiscal year
from June 30 to December 31.
In February, 1994, the Company acquired the technology and inventory of
the Byron Hydrocarbon Analyzer line from General Monitors, Inc. ("GMI"), for a
purchase price of $225,000. Of the purchase price, $200,000 was paid by the
Company in cash and $25,000 was rescheduled by mutual agreement and was paid
July 1, 1996.
In March 1994, the Company entered into an exclusive worldwide
requirements agreement over a three-year period with London-based Logan
Research, Ltd. ("LRL") to provide LRL with oxides of nitrogen instrument parts
on an "as required" basis for use in medical technology applications. In October
1995, the agreement was modified to be exclusive with a domestic corporation,
Logan Medical Devices ("LMD"), which acquired Logan Research, Ltd. In 1995, the
Company advanced $164,000 to LRL. The $164,000 was charged against operations in
1995. In June 1996 the Company acquired 100% of the common stock of LMD for
600,500 options to LMD shareholders, all options above market bid price and
vesting in January, 1998, such bid price as existed in the date of agreement. In
addition, the Company contributed $250,000 to LMD for working capital. LMD is
considered as a "start-up" which requires equity funding for marketing and FDA
approval. The product however, is considered "commercial." There is no assurance
that any equity funding can be obtained.
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Also, in June, 1996, the Company acquired 100% of the stock of Nutek,
Inc., a Pensacola, Florida, electrical control panel and printed circuit board
manufacturer. No company stock was issued, but 340,000 options at above market
bid price on the date of agreement were issued to key employees in this
transaction, lawyers and "finders." Such options will vest in January 1998. The
Company directly paid $250,000 cash into an estimated total purchase price of
$1,900,000, the balance obtained from asset based financing solely on Nutek's
assets. The Company acquired Nutek primarily for the customer list as it would
fit into the Company's air pollution control technology diversification plans.
To finance the two acquisitions described above, the Company entered
into a private placement on May 30, 1996 for $600,000 in exchange for 1,000,000
units consisting of one share of Common Stock and one warrant to purchase one
share of Common Stock for $1.00. The approximate market bid price at that time
frame was $0.80 per share.
Concurrently on May 30, 1996, the Company retained a public relations
firm under a one year contract for a total consideration of 1,000,000 options
for Common Stock at a bid price on date of signing and an additional 1,000,000
options for Common Stock at 25% above bid price. On September 3, 1996 the
contract duration was reduced by six months and the number of additional options
referred to above was reduced by 700,000. On October 29, the Company reduced the
contract duration by another two months.
On September 20, 1996 the Company entered into a private placement with
an unaffiliated individual at an average price of 1.00 per unit (market at
$1.25 per common share) which consisted of 350,000 common shares and 300,000
warrants to purchase Common Stock at $1.50 per share.
The Company's operating profit for fiscal 1994, 1995, and 1996
decreased significantly as compared to fiscal 1993. These declines were
principally because of significant competitive price pressure for the Company's
air pollution monitoring instruments, thus forcing the Company to lower its
domestic and foreign bids, reducing the number of the Company's bids awarded and
reducing the profit margin on the bids awarded to the Company. Beginning in the
third quarter of fiscal 1994, the Company implemented certain cost reduction
measures in its operating expenses, suspended major new product development
efforts and scaled back its efforts to improve or modify existing technologies
in response to the competitive price pressures. Throughout 1995 and 1996 the
Company shipped record numbers of instrumentation units, but continued
competitive pricing pressure resulted in lowered gross margins. In March of
1996, efforts were begun to reduce fixed expenses by participating in the
Mexican Maquiladora program, initially for all production labor associated with
the Company's excess backlog, if any. This program was cancelled in July 1996
and all costs expensed.
THE AIR POLLUTION INDUSTRY
Air pollution consists of certain gases or particles, generally the
products of combustion or other industrial processes, which are or may be
hazardous to human health. Pollutants include carbon monoxide, ozone, oxides of
sulfur and nitrogen, hydrogen sulfide and particles. Small amounts of these
pollutants, such as a few parts per million or part per billion, may be harmful.
The instruments produced and sold by the Company, the "core business" detect and
measure these pollutants and are also utilized in calibrating other pollution
measurement equipment. Any systems or processes such as the Company's "flue gas
purification
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system" patent employ chemical and mechanical means to remove these same
pollutants from combustion exhaust gases. (See "Research and Development" under
this Item 1. "Description of Business").
Industrial entities require equipment to detect the presence and
measure the level of pollutants in order to comply with governmental regulations
and government regulatory agencies require equipment to enforce governmental
standards. Currently, international priority has been given to control (and
therefore to monitor) such gaseous pollutants as sulfur dioxide, oxides of
nitrogen, carbon monoxide, ozone and particulates (suspended dust).
Although manual sampling of both gases and particulates is still
performed routinely, improvements in the reliability and accuracy of automated,
continuous monitoring equipment, such as that manufactured and sold by the
Company, have made manual sampling less desirable and automated monitoring
increasingly common.
In basic continuous monitoring instruments, ambient air is taken into a
manifold, the function of which is to direct a fast-moving stream of ambient air
to the monitor. The instrument may use a filter to remove particulates or
scrubbers to remove gasses that might interfere with accurate measurement of the
pollutant. The pollutant is then introduced into a measurement cell environment
where it undergoes a chemical or physical reaction, the output of which can be
converted to an electrical signal which, in turn, can be read locally or
transmitted to some remote monitoring plant or computer. Measurement cells can
be based in many different methods for the detection of the pollutants of
interest. Thus, an instrument designed may have many different methods available
by which a pollutant may be identified and measured.
Some methods used by the Company are flame photometry (wherein
concentrations of gaseous elements are measured by burning them and optically
observing the color and intensity of the flame generated thereby), infrared
absorption (wherein concentrations of infrared absorbing gases are measured by
detecting changes in intensity of a radiation beam closed cell),
chemiluminescence (wherein a chemical generates a light or a wave length
measurable by a photo multiplier tube), ultraviolet spectroscopy (wherein the
pollutants' decrease in ultraviolet light intensity is converted by a
photoelectric detector to an electric signal) and beta ray attenuation (wherein
a radioactive source's beta ray emanation is reduced in direct proportion to the
mass of a particle).
INSTRUMENT MARKET
The air pollution monitoring equipment market includes two markets: (i)
source instrumentation for monitoring the source's pollutant emissions as they
are discharged into the air and (ii) ambient air for instrumentation for
monitoring ambient air pollution. The two markets are quite different in that
source instrumentation is generally not subject to rigid governmental-imposed
guidelines because of the difficult analyses involved, while ambient air
instruments are subject to rigid governmental guidelines because the pollutants
are easier to define and measure.
Generally, the Company sells its instruments for use in systems for the
measurement of ambient air pollution. In a system, air pollution monitoring
instruments are united with additional equipment to provide a comprehensive
measurement unit. In an ambient air instrumentation system, the monitoring
instrument
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is combined with a manifold intake, a calibrator and data transmitters. The
system samples the ambient air, measure the pollutants and transmits the data.
The Company designs and manufactures all instruments used in a system, including
the data tabulation and transmission devices. At the present time, the Company
believes that it is the only manufacturer that is able to furnish its customers
with a complete "in-house" ambient air monitoring system.
Until recently, the Company's products were not applicable to the
source instrumentation market. However, because of the new governmental
regulations requiring greater accuracy and dilution conditioning as a standard
(reducing pollution concentrations to the parts per billion level) for source
instrumentation involving a continuous emission monitoring system ("CEMS"), the
Company's products are now applicable. The Company is not currently able to
offer customers a CEMS because it does not manufacture the additional equipment
needed to complete the system. The Company commenced a research and development
program in July 1992 for the purpose of developing an innovative CEMS which
currently remains in the prototype stage of development. The Company does not
require EPA-approval of any of its instruments in order to complete a CEMS. (See
"Research and Development" under this Item 1.
"Description of Business.")
CONTROL MARKET
The air pollution control market makes only minimal use of measurement
instrumentation. This market is concerned with "purification" of exhaust gases
emanating from combustion-related or even chemical-only processes. The
"purification" process consists of using various types of equipment which may or
may not involve catalysts and/or reagents to cause reactions and/or mechanical
removal of a high percentage of selected air pollutants. The highest percentage
obtainable will relate, at any given time, to the state-of-the-art of the
technology involved and the economics of implementing the technology. The market
is old, in essence dating to the beginnings of the industry when soot collectors
were first installed on combustion chambers. However, the market size is
embryonic since technology has not materially advanced and implementation
remains costly so as not to allow any generally accepted control of source
pollutants. The Company filed a patent application in April 1994 for a "flue gas
purification system," which issued in 1996, however, the commercial viability of
a market for this invention is not assured. (See "Research and Development" and
"Intellectual Property" under this Item 1. "Description of Business.")
The acquisition of Nutek, which primarily designs and fabricates
instrument electrical control panels, was intended at first, as an entry into
the coal-fired industrial applications and second as a manufacturer for
significant components of the Company's patent system.
GOVERNMENTAL APPROVAL
The Environmental Protection Agency (the "EPA") administers the federal
Clean Air Act, as amended by the Clean Air Act Amendments of 1990, and approves
ambient air pollution monitoring equipment meeting certain requirements as
either reference or equivalent methods for measuring pollutants. The EPA
established the reference method as the basic method for measuring a pollutant.
An equivalent method measures the same pollutant utilizing a different technique
which achieves results identical to those of the referenced method.
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As a practical matter, before a monitoring instrument can be sold in
the United States, it must receive EPA-approval as either a "reference" or
"equivalent" method. Such approvals are given only after rigorous and expensive
testing by the applicant and the submission to, and approval by, the EPA of the
results of such testing. The testing and approval process generally requires
between 12 and 18 months. Following approval, the EPA typically acquires and
tests a production model of the device. If the model being tested does not meet
the standards established by the approval process, the approval may be
withdrawn.
Each of the Company's models of ozone monitors and its sulfur dioxide
and oxides of nitrogen monitors have been approved as equivalent methods by the
EPA. Additionally, the Company's carbon monoxide have been approved as
equivalent methods by the EPA. Additionally, the Company's carbon monoxide
monitors have been approved as reference methods. The Company is currently
testing a particulate analyzer (beta ray attenuation) for approval as an
equivalent method by the EPA. The Company has never had, or been threatened
with, a recall as the result of subsequent testing by the EPA of a production
model of any of its instruments.
The Company believes that, as the performance of air monitoring
equipment improves and monitoring technology becomes available in the market,
government regulatory agencies tend to adopt regulations requiring the use of
such technology. The Company has never been required to modify or discontinue
any of its products as a result of improved technology. However, there can be no
assurance that future technological improvements will not mandate changes in, or
cause the obsolescence of, Company products.
GOVERNMENTAL REGULATION AND ENFORCEMENT
Legislation requiring more precise air pollution monitoring and
enforcement is increasing in the sophistication of the technology improves and
as concern for the environment, particularly the depletion of the ozone layer,
becomes more acute. The Clean Air Act and the Clean Air Act Amendments of 1990
(the "1990 Amendments"), which are being rapidly implemented, require increased
control of industrial air pollution and represent an increasing threat of
shut-down for U.S. industrial concerns which fail to obtain necessary permits
and engage in other conduct violative of the legislation. Because increased
control requires increased management and monitoring of air pollutants by
government and industry, the Company expects, but cannot assure, a steadily
increasing market for its products. Company management believes that
governmental enforcement policy also has a significant effect on the demand for
the Company's products. A relaxation during 1982 in the federal enforcement of
governmental standards resulted in a decrease in demand for the Company's
products. Since the, the worldwide trend toward increasingly stringent
environmental standards for industrial air pollution together with stricter
governmental enforcement of environmental regulations, is expected by management
to cause continued expansion of segments of the analytical instruments market
and a continued increase in demand for the Company's products. In essence, the
Company furnishes a product that the customer does not want to buy voluntarily.
In previous years, price difference was not significant to the selection
process. Since 1994, sizeable discounts have become significant to the
purchasers.
COMPANY PRODUCTS
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In 1972, the Company developed, and in 1974 initially marketed, the
first ultraviolet ozone monitor, of which eight models are currently marketed by
the Company, including high concentration, manual, remote and
microprocessor-controlled versions. The Company will continue to seek to develop
new versions of its basic model of ozone monitor, but does not expect any change
in the basic principle upon which the instrument operates. The Company is
generally considered the leader in ozone measurement technology in the world.
The Company developed microprocessor-controlled carbon monoxide, sulfur
dioxide and oxides of nitrogen monitors in 1981, 1986 and 1987, respectively. In
August 1986, the Company completed prototype development of a
microprocessor-controlled oxides of nitrogen monitor based upon a technique
acquired from Combustion Engineering Corporation. Although the unit did not
initially receive EPA-approval, a redesigned unit received the requisite
approval of the EPA in mid-1992.
Calibration equipment, which is utilized to independently verify the
measurements made by other monitoring equipment, was first manufactured and sold
by the Company in 1976 and known as the "Auditor," was followed by a
manually-operated, portable model which performs similar functions. In 1990,
both of these models were superseded by the Company's Model 5008
state-of-the-art, programmable calibration equipment.
The Company completed development, in 1991, of a Model 7001 beta-gauge
to measure sub-micronic particulates, a Model 8001 data-logger to gather and
transmit measured air pollutant information and a Model 9001 semi-CEMS to be
used as a portable stack monitoring system.
In February 1994, the Company acquired the technology and inventory of
the Byron Hydrocarbon Analyzer line. In bidding various jobs, the Company has
been asked to furnish an ambient hydrocarbon analyzer as a portion of the
"system." Previously, the Company did not have the technical capability to
manufacture this particular product and was forced to purchase it from other
companies. The Company's choice, whenever possible, was the Byron Hydrocarbon
Analyzer, even though it was the most expensive. Management believes that the
acquisition of this technical capability has made the Company more competitive
in bid applications requiring a hydrocarbon instrument. In addition, the
analyzer has certain proprietary aspects which are helpful in competitive bid
situations specifically requesting hydrocarbon data.
In June 1996, the Company acquired Logan Medical Devices ("LMD") a
"start-up" "operation". For three years prior, the Company worked with LMD's
principal to modify and improve the Company's nitric oxide instrument to allow
non-invasive asthma diagnostics. While the Company believes the instrument is
"commercial", external funding is required for a medically-oriented sales and
marketing network and additionally for completion of FDA approval. There is no
indication that the Company will be successful in its attempt to manufacture and
market this product on a scale comparable to its "core business."
The Company offers a two-year warranty on all of its instruments, with
the exception of certain components, such as lamps, which have short lives. With
respect to such components, the Company passes on to the customer the warranty
(usually one year) which it receives from the manufacturer. The Company's
warranty provides for repair or replacement of defective products. During each
of the last five fiscal years,
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the Company has been required to honor its warranty with respect to less than
0.3% of total instruments sales during each such year.
In June, 1996, the Company acquired Nutek, Inc., - an established
instrument, electrical control panel design and fabrication facility. These
products, per se, are not synergistic with the air pollution control technology
nature of the Company except in certain cases where the panels may control large
air pollutant removal devices. Nutek's customers are primarily associated with
coal-fuel combustion and are therefore potential customers for the Company's
current approach to the air pollution control business. However, Nutek has a
substantial potential synergistic value in design and manufacture of the
Company's existing instrument components and the Company's proposed control
systems.
MARKETING AND SALES; BACKLOG INSTRUMENTS
The marketing and sales activities of the Company include advertising
by mail in trade journals (primarily Pollution Equipment News and Air Pollution
Control Association Journal) and attendance and exhibition at worldwide air
pollution conferences. The Company attends the annual conference of the Air
Pollution Control Association as well as worldwide conferences. The Company's
core business instruments have been sold to customers world-wide, including
industrial manufacturers; federal, state, city, local and foreign governmental
agencies; major industrial companies; and educational and research institutions
in over 30 countries. Sales made in the United States are handled directly by
the Company's sales staff. All of the Company's foreign sales are made to
distributors who, in turn, resell to the end users. The Company sells to these
distributors at a discount from the listed price. Management believes that the
loss of a distributor who may account for a large percentage of sales would have
little impact on net revenues as the end users of the Company's products could
be transferred to new distributors.
During the last three fiscal years, foreign sales have represented
approximately 55% to 70% of the Company's total revenue. The Company's sales in
the export market are evenly distributed among all of its products. Export sales
are billed and paid in the United States dollars only.
The Company's core business instruments have been sold during the past
five years to over 300 customers in over 30 countries, including industrial
manufacturers; federal, state, city, local and foreign governmental agencies;
and educational and research institutions. However, a significant loss in the
number of government agencies, industrial companies or research agencies which
typically purchase the Company's instruments could have a material adverse
effect on the Company.
Historically, none of the Company's business has been subject to the
re-negotiation of profits, and no government orders have ever been terminated.
The backlog at December 31, 1996 was approximately $500,000 which amount the
Company does not consider material.
FOREIGN SALES
The following table sets forth certain information regarding the
Company's foreign sales for the last two fiscal years:
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Year Ended
December 31,
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1996 1995
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(In thousands)
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Aggregate sales to unaffiliated foreign customers:
Europe and The United Kingdom $ 866 $1,445
Asia and Pacific Rim $ 1,200 $1,071
Latin America & Other $ 607 $ 525
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During the fiscal year ended December 31, 1996, no one customer
accounted for more than 10% of net sales. During the fiscal year ended December
31, 1995 sales to a foreign distributor who services multiple customers
represented 16% of net sales.
Historically, backlog has not been significant to the Company's
operations because orders usually require delivery in 45 to 90 days. As of
December 31, 1996, the Company had approximately $2,600,000 in orders which
required delivery in 90 days or less, a backlog which the Company does not
consider significant.
Nutek markets through sales agents located in the Southeast. A request
for quotation is usually generated from an end user of an engineering firm for
competitive bid. The backlog at December 31, 1996 was approximately $2,000,000,
which amount the Company does not consider material.
MANUFACTURING AND PURCHASING
The Company manufactures many components and subsystems for use in its
products, including critical optical components and analog and digital
circuitry. Other components, including packaging materials, integrated circuits,
microprocessors and minicomputers, are purchased from unaffiliated third
parties. Most of the raw materials and supplies purchased by the Company are
either available from a number of different suppliers or alternative sources
could be developed without a materially adverse effect on the Company's
business. However, the availability and quality of certain key instrument
components, such as printed circuit board designs and lamps, are controlled by a
limited number of vendors. A vendor's inability to supply these components to
the Company in a timely fashion, or to the Company's satisfaction, can affect
the Company's ability to deliver its instruments on time.
RESEARCH AND DEVELOPMENT
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Historically, the Company has been actively engaged in research and
development in order to produce new products. However, the competitive price
pressures experienced by the Company since early 1994 have sharply limited the
new product development to areas of software as opposed to hardware. Developed
over the past three years, DECS (Dasibi Environmental Central Software) is a
Windows-based, network control and reporting program for multi systems of
pollutant analyzers and ancillaries. Similar programs exist but management
believes none are under single manufacturer design and responsibility.
Because of price pressure demands, the Company has been limiting CEMS
and Flue Gas Purification System development work.
EMPLOYEES
As of March 24, 1997, the Company had 115 full-time employees, of whom
9 were engaged in administration, 13 in engineering, 88 in manufacturing and 5
in sales and marketing. None of the Company's employees are represented by a
labor union. The Company has never had a strike or lockout and considers its
employee relations to be good.
COMPETITION - INSTRUMENTS
The Company is the smallest competitor in the ambient air pollution
instrumentation market. Therefore, it is subject to the effects of
better-financed competitors and their research and development efforts, and
price discounting. The Company competes on the basis of technical advances in
its products and its reputation among customers as a quality provider of
products and services. To a lesser extent, the Company competes on the basis of
price.
Although the Company is not aware of any other company that competes
with it in all of its product lines, all of its competitors have resources
substantially greater than those of the Company. There are also smaller
companies that specialize in a limited number of the types of products
manufactured by the Company. The Company's primary competitors in the domestic
market are Thermo Instrument Systems, Inc. ("Thermo Instrument Systems") and
Monitor Labs, Inc. ("Monitor Labs"). In the foreign market, the Company's
primary competitors are Thermo Instrument Systems, Monitor Labs and Kimoto
Instruments Co. of Japan ("Kimoto Instruments Co.") and Horiba ("Horiba
Instruments.")
A number of the Company's principal competitors (including Thermo
Instrument Systems, Monitor Labs and Kimoto Instruments Co.) offer ambient air
pollution monitoring and also CEMS to their customers. As discussed hereinabove
under "Instrument Market" and "Research and Development", the Company is
presently unable to provide CEMS. The Company intends to enter the market for
CEMS, although it is extremely competitive and the firms in such market have
substantially greater experience and financial resources than the Company. There
can be no assurance that the Company's efforts to enter the CEMS market will be
successful.
COMPETITION - CONTROL PANELS
13
<PAGE> 14
Nearly all of Nutek's competitors are considerably larger and more
"well-financed" than Nutek. Nearly all awards are the result of competitive
bidding which results in low gross profit margins. Primary competitors are
Instrument Control Service ("ICS") and Carter-Crawley Engineering and Controls.
INTELLECTUAL PROPERTY
Although the Company obtained patents for its ozone monitor and various
techniques in instrument design, it has generally been the Company's policy to
proceed without patent protection since it is management's belief that the
disclosure requirements of the federal patent laws provide competitors with easy
access to the secrets of rapidly changing technology. The instrument patents
obtained by the Company, all of which have expired, are not deemed by management
to be significant to the Company's business operations or potential success. The
Company has no federal or state registered trademarks and no franchises or
concessions. The Company has common law rights to the trademark "Dasibi."
Albert E. Gosselin, Jr., the Company's co-founder, has, for the past
several years, devoted personal research time to developing an innovative, cost
conscious system for purifying exhaust gases. His efforts resulted in the
filing of a patent application for such system on behalf of the Company in
April 1994, subsequently granted in September 1996.
ITEM 2. DESCRIPTION OF PROPERTIES
In July 1994, the Company moved its administrative, instrument
manufacturing and employee facilities to 39,070 square feet at 506 Paula Avenue,
Glendale, California. The Company leases the space from an unaffiliated third
party for a term of ten years commencing as of July 1, 1994, at a base rent of
$24,223 per month plus operating costs and taxes, with a provision for increases
in the base rent related to increases in the Consumer Price Index. The Company
utilizes most of its existing office and manufacturing space and believes that
such space is adequate for its needs for the foreseeable future.
The Company's Nutek subsidiary has two buildings located in twelve
acres in a prime commercial area. The main building contains offices, sheet
metal and electrical areas and has 20,200 square feet. The second building,
housing printed circuit board and painting, has 18,180 square feet. Land and
buildings are under one five year lease to an unaffiliated party at rents
increasing from $3,000 per month to $7,000 per month in year 5.
The Company's Logan Medical Device subsidiary is approximately 4000
square feet in Kent, U.K. and is leased from Mr. Ron Logan-Sinclair pension fund
holdings at a rate of $600 per month which the Company believes to be fair and
reasonable.
ITEM 3. LEGAL PROCEEDINGS
No material legal proceedings are pending to which the Company or any
of its property is subject, nor to the knowledge of the Company are any such
legal proceedings threatened. The Company is a party to legal actions from
time-to-time which develop in the ordinary course of its business and which are
not, in the opinion of management, material to the Company's business.
14
<PAGE> 15
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of the Company's shareholders
during the fourth quarter of the Company's 1996 fiscal year by means of the
solicitation of proxies or otherwise.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock is traded over-the-counter on NASDAQ under
the symbol "PRCC." Set forth below are the high and low closing bid by
quotations in the over-the-counter market for the Common Stock as reported by
the relevant market makers for fiscal years 1996 and 1995. Quotations represent
inter-dealer quotations, without adjustment for retail mark-ups, mark-downs or
commissions, and may not necessarily represent actual transactions.
<TABLE>
<CAPTION>
Fiscal 1996 Fiscal 1995
Quarter Ended High Bid Low Bid High Bid Low Bid
- ------------- -------- ------- -------- -------
<S> <C> <C> <C> <C>
Common Stock:
March 31 $ .81 $.44 $ .69 $ .62
June 30 1.91 .59 .91 .59
September 30 1.81 .97 1.22 .62
December 31 1.44 .81 .88 .56
</TABLE>
As of March 23, 1997, the approximate number of shareholders of record
of the Company's Common Stock was 1,100. The Company has never paid or declared
any dividends on its Common Stock and does not anticipate paying dividends in
the foreseeable future.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATION
Net revenues in 1996 were $8,805,000, compared to $5,515,000 in 1995, a
60% increase. The increase was primarily due to the acquisitions of Nutek and
LMD completed in June, 1996, although revenues from the Dasibi core air
pollution business improved 3%.
Gross margin was 27% of consolidated net revenues in 1996, compared to
34% in 1995. Approximately 60% of the decline was due to the fact that Nutek has
historically operated at lower gross margins (20 to 25%) than the air pollution
instrument business; a decrease to a 29% gross margin for 1996 in the core
business, caused by product mix and ongoing competitive price pressures,
accounted for the other 40% of the decline in consolidated gross margin.
15
<PAGE> 16
Selling, general and administrative expenses increased from $2,044,000
in 1995 to $2,278,000 in 1996, or 11%. The selling, general and administrative
expenses of Nutek and LMD added in June, 1996 were offset in part by the cost
reductions made at Dasibi.
Research and development expense decreased from $238,000 in 1995 to
$136,000 due to further cutbacks management made in its research and development
efforts in response to the continuing price pressures.
Interest expense increased from $6,000 in 1995 to $146,000 in 1996,
primarily due to the debt incurred to finance the Nutek acquisition.
In 1996, a non-recurring gain from the sale of a portion of the
Company's shares in Atlanta Technology Group, Inc. of $570,000 was realized. In
1995, a non-recurring loss of $164,000 related to the development of the Logan
Research venture was recorded.
In 1995, the Company recorded no income tax benefit on its net loss.
Prior to 1996, the net operating loss carryforward and other deferred tax assets
had a 100% valuation allowance against them. As a result of the acquisitions
completed in June, 1996, management reevaluated the valuation allowance, and
because management believed there was now a greater likelihood the deferred tax
assets will ultimately be realized, began reducing the valuation allowance
beginning with the second quarter of 1996. A total of $292,000 in deferred tax
credits were recorded in 1996.
As a result of the foregoing factors, net income was $640,000 compared
to a net loss of $597,000 in 1995, an improvement of $1,237,000.
LIQUIDITY AND CAPITAL RESOURCES
The Company has historically financed operations through bank
borrowings and the issuance of common stock in both public and private
offerings.
Working capital at December 31, 1996 was $3,048,000. Management
believes that the anticipated cash flows from operations will be sufficient to
meet the Company's short-term cash needs. As of March 24, 1997, the Company has
no material commitments for capital expenditures.
The Company has a line of credit with a bank which provides for
borrowings of up to $200,000 until June 3, 1997. Interest is at the prime rate
plus 2%. $190,000 was outstanding at December 31, 1996; $90,000 was outstanding
on March 24, 1997.
Nutek has a line of credit from an asset-based lender of the lesser of
$1,000,000 or the borrowing base (as defined); which expires June 28, 1999.
Nutek's line of credit bears interest at the large commercial bank prime rate
plus 2 1/2%. $364,000 was borrowed on Nutek's line at December 31, 1996;
$488,460 was outstanding March 24, 1997.
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<PAGE> 17
Net cash flows from operating activities was a negative $236,000 in
1996, due primarily to an increase of $789,000 in accounts receivable, which
were at unusually low levels at the end of 1995.
Proceeds from the sale of common stock and the exercise of options and
warrants was $1,157,000 net of offering costs in 1996. Debt was reduced a net
$385,000; $380,000 (net of cash acquired) was invested in acquisitions; capital
expenditures and the investment in the patent were $77,000; the remaining
$315,000 was available for operations.
SEASONALITY
Management does not believe that the Company's business is seasonal.
ITEM 7. FINANCIAL STATEMENTS
The Company's Financial Statements and the related Notes thereto are
set forth at pages F-1 through F-19.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURES
On December 28, 1996, the Company disengaged the accounting firm of
Greenberg & Jackson as its independent auditors and selected the accounting firm
of AJ. Robbins, P.C. to act as the Company's independent auditors for the fiscal
year ended December 31, 1996. Disclosure regarding this matter is set forth in
the Company's Current Report on Form 8-KA dated January 9, 1997.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
DIRECTORS, EXECUTIVE OFFICERS AND KEY EMPLOYEES
Set forth below are the names, ages, positions with the Company, Dasibi
Environmental Corp, Nutek, Inc. and Logan Medical Devices:
<TABLE>
<CAPTION>
NAME AGE POSITION(S) WITH COMPANY AND DASIBI
---- --- -----------------------------------
<S> <C> <C>
Albert E. Gosselin, Jr. (1)(3) 64 President, Chief Executive Officer and
Chairman of the Board of Directors
Cynthia L. Gosselin (1)(2) 35 Chief Financial Officer
Barbara L. Gosselin (1)(2) 61 Secretary and Director
Marcia A. Smith (1) 58 Director of Pollution Research and Control
Corp.; Manager of Administration of Dasibi
Environmental Corp.
</TABLE>
17
<PAGE> 18
<TABLE>
<CAPTION>
NAME AGE POSITION(S) WITH COMPANY AND DASIBI
---- --- -----------------------------------
<S> <C> <C>
Gary L. Dudley (1) 59 Director
Craig E. Gosselin (1) 37 Director
Paul Richardson 54 President, Director Nutek
Debbie Kendrick 45 Vice President, Director Nutek
Ron Logan-Sinclair 47 President, Director LMD
</TABLE>
(1) The individuals named above hold the identical positions indicated with
Dasibi Environmental Corp. ("Dasibi")
(2) The individuals named above hold the identical positions indicated with
Nutek, Inc.
(3) The individual named above is a director of Nutek, Inc.
All directors hold office until the next annual meeting of the
Company's shareholders and until their successors have been elected and qualify.
Officers serve at the pleasure of the board of directors.
FAMILY RELATIONSHIPS
Albert E. Gosselin, Jr., and Barbara L. Gosselin, husband and wife, are
the parents of Craig E. and Cynthia L., all of whom are adults. All of the
foregoing are presently serving as executive officers and/or directors of the
Company. Except as set forth herein, no family relationship exists between any
director or executive officer or the Company.
BUSINESS EXPERIENCE
Albert E. Gosselin, Jr., has served as the President, Chief Executive
Officer and Chairman of the Board of Directors of the Company (formerly "Dasibi
Environmental Corp." and "A.E. Gosselin Engineering, Inc.") and Dasibi (formerly
"Baral Engineering, Inc."), corporations which he co-founded with Barbara L.
Gosselin, since the organization of those corporations in December 1971 and July
1976, respectively. He also served as the President, Chief Executive Officer and
Chairman of the Board of Directors of the Company's former parent corporation, a
corporation also named "Pollution Research and Control Corp. ("PRCC") which he
co-founded with Mrs. Gosselin under the name of "A.E. Gosselin Engineering Co.,"
from its inception date in 1966 through the date of its spin-off in October
1986. Mr. Gosselin also served as the President, Chief Executive Officer and
Chairman of the Board of Directors of Applied Conservation Technology, Inc.
("ACT"), a former wholly-owned subsidiary engaged in the business of providing
environmental impact reports to electric utilities, together with the Company,
of PRCC, from 1980 through the date of the purchase of ACT by its management
from PRCC in November 1986. ACT is presently a diversified environmental
consulting firm owned and managed by Gary L. Dudley, a Company director, and
other members of management. Mr. Gosselin received a Bachelor of Science in
mechanical
18
<PAGE> 19
engineering from Loyola University, Los Angeles, California, in 1954. He has
been a registered mechanical engineer in the State of California since 1959.
Cynthia L. Gosselin has served as the Chief Financial Officer of the
Company and Dasibi since May 1990. Additionally, she has acted as Dasibi's
Purchasing Agent during this period. She was employed by Dasibi in various
capacities, including Production Manager, from 1983 through April 1990. Ms.
Gosselin received a B.S. in business from the University of California at Long
Beach in 1982.
Barbara L. Gosselin has served as an executive officer and a director
of the Company, which she co-founded with Albert E. Gosselin, Jr., in December
1971, since its inception. Mrs. Gosselin has served in the office of Secretary
of the Company since April 1990 and, from inception through April 1990, she
served as the Company's Chief Financial Officer. Mrs. Gosselin, together with
Mr. Gosselin, co-founded Dasibi in July 1976 and she has served as the Secretary
and a director of Dasibi since its organization. Mrs. Gosselin was the
co-founder in 1966, with Mr. Gosselin, of PRCC, the Company's former parent
corporation, for which she served as an executive officer and a director until
it was spun-off in October 1986.
Marcia A. Smith has served as a director of the Company and Dasibi
since May 1990. She has been employed as the Manager of Administration and in
various other capacities with Dasibi since 1979.
Gary L. Dudley has served as a director of the Company during the
periods since June 1991 and from 1980 through January 1991, and he served as the
Company's Vice President from 1979 through November 1986. Mr. Dudley also served
as an executive officer and a director of PRCC, the Company's former parent
corporation, from 1984 through the date of the spin-off of PRCC in October 1986.
Mr. Dudley has been the President and a principle shareholder of ACT, now
located in Westminster, California, a diversified environmental consulting firm
formerly wholly-owned, together with the Company, by PRCC, since the purchase of
ACT by its management from PRCC in November 1986. He served as ACT's Vice
President from 1980 through 1986. From 1962 through 1978, Mr. Dudley was
employed in various engineering-related positions by Southern California Edison
Company, TRW Systems, McDonnell Douglas Corporation and North American Rockwell
Corporation. He received a Bachelor of Science in engineering from California
State University in 1962 and a Masters Degree in Mechanical Engineering from the
University of Southern California in 1966. Mr. Dudley is a registered mechanical
engineer in the State of California and a member of the Association of
Environmental Professionals.
Craig E. Gosselin has served as a director of the Company and Dasibi
since October 1987. Mr. Gosselin is an attorney who has been licensed to
practice law in the State of California since 1984. He has served as the Vice
President and General Counsel of Vans, Inc., a publicly-held manufacturer,
distributor and retailer of footwear, snowboard boots, apparel and related
accessories located in Orange, California, since July 1992. He received a
Bachelor of Business Administration from Loyola Marymount University in 1981 and
a Juris Doctor from Southwestern University School of Law in 1984.
Paul Richardson was employed by Nutek as an Electrical Engineer from
1970 to 1994. He returned in 1996 to serve as President and a Director of Nutek.
Mr. Richardson received a Bachelor of Electrical Engineering from the University
of Florida in 1964.
19
<PAGE> 20
Debbie Kendrick, a founder of Nutek, has been employed with Nutek since
1978 in all areas of administration.
Ron Logan-Sinclair founded, and has served as the Managing Director of
Logan Research Limited, Rochester, Kent, England, since April 1994. Logan
Research Limited has been engaged in research and development involving medical
devices, primarily, medical inflammation (nitric oxide) analysis devices and
artificial heart drive devices since May 1994. For a period of approximately 24
years prior to April 1994, Mr. Logan-Sinclair was employed by the Royal Brompton
National Heart and Lung Hospital, London, England, with responsibilities in the
areas of medical electronics, biomedical and clinical engineering and medical
physics. He is a proven researcher and designer of medical equipment who
developed the inflammation and analytical monitor and is presently engaged in
the development of a number of other medical devices.
The Company, Albert E. Gosselin, Jr., President, Chief Executive
Officer and Chairman of the Board of Directors of the Company, and Cynthia L.
Gosselin, Chief Financial Officer of the Company were named as defendants in
Case Number 1.94CV01425 filed by the Securities and Exchange Commission in the
United States District Court for the District of Columbia on June 28, 1994. The
Commission alleged in the Complaint for Permanent Injunction and Other Relief,
among other things, that the Company and Mr. Gosselin committed numerous
violations of the federal securities laws in 1989, 1990 and 1991, including
disseminating materially false and misleading information about the Company to
the investing public through public announcements and filings with the
Commission relating, primarily, to the Company's acquisition and subsequent
disposition of two companies, Air Instruments and Measurements, Inc. and
Environmental Information Systems. Additionally, the Complaint alleged that the
Company's financial statements incorrectly reported inventory figures and failed
to reflect timely write-offs of uncollectible accounts receivable and that the
Company materially understated annual and quarterly losses during this period.
The allegations against Ms. Gosselin were that she served as the Company's Chief
Financial Officer and that she was responsible for the Company's inadequate
books and records and internal controls during this period. The Commission also
alleged that the Company violated the federal securities laws in connection with
an unregistered public distribution of securities. The Commission sought to
enjoin the defendants from engaging in the future in similar illegal acts and
practices and to order defendant Albert E. Gosselin, Jr., to pay civil
penalties. On July 14, 1994, the defendants, without admitting or denying any of
the allegations of the Complaint, consented to the entry of Final Judgment of
Permanent Injunction and Other Relief (the "Final Judgment"). The Final Judgment
as to Mr. Gosselin required him to pay a civil penalty in the amount of $25,000.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
required the Company's and executive officers and directors, and persons who own
more than ten percent of a registered calls of the Company's equity securities,
to file with the Securities and Exchange Commission initial reports of
ownership, and reports of changes in ownership, of Common Stock and other equity
securities of the Company. Executive officers, directors and greater than ten
percent shareholders are required by Commission regulations to furnish the
Company with copies of all Section 16(a) reports they file. To the Company's
knowledge, based solely on a review of the copies of such reports furnished to
the Company,
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<PAGE> 21
and representations that no other reports were required during the fiscal year
ended December 31, 1996, the Company's executive officers, directors and greater
than ten per cent beneficial owners of its Common Stock, complied with all
Section 16(a) filing requirements applicable to them.
ITEM 10. EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
The following table sets forth the total cash and non-cash
compensation paid by the Company for the fiscal years ended December 31, 1994,
1995, and 1996 to the Company's President and Chief Executive Officer who was
the only executive officer of the Company whose aggregate cash compensation
exceeded $100,000 for the 1996 fiscal year.
SUMMARY COMPENSATION TABLE
Annual Compensation
<TABLE>
<CAPTION>
Long Term
Compensation Awards
Securities Underlying
Name and Principal Position Year Salary Options/SARs(#)
- --------------------------- ---- ------ ---------------
<S> <C> <C> <C>
Albert E. Gosselin, Jr., President, 1996 $ 211,925 55,000
Chief Executive Officer and 1995 $ 196,638 ---
Chairman of the Board 1994 $ 180,000 53,847
</TABLE>
The Company does not provide officers or employees with pension, stock
appreciation rights, long-term incentive or other plans.
COMPENSATION OF DIRECTORS
Directors do not receive compensation pursuant to any standard
arrangement for their services as directors.
EMPLOYMENT AGREEMENTS
The Company has employment agreements with Albert E. Gosselin, Jr., the
President, Chief Executive Officer and Chairman of the Board of Directors of the
Company, and Cynthia L. Gosselin, the Company's Chief Financial Officer. Mr.
Gosselin's employment agreement (the "Agreement") was first approved by the
Board of Directors on July 30, 1987, and has since been extended through August
31, 1999. The Agreement, as extended, provides for the payment to Mr. Gosselin
of a base salary of $200,000, $210,000 and $220,000 during the one-year periods
ended August 31, 1996, 1997 and 1998
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<PAGE> 22
respectively. (See "Executive Compensation" under this Item 10. "Executive
Compensation" hereinabove.) The Agreement further obligates the Company to
permit Mr. Gosselin to participate in the Company's Employee's Incentive Stock
Option Plan and Group Medical Plan and any other health, life insurance, group
medical, disability income insurance and/or stock option plan adopted by the
Company. Under the Agreement, Mr. Gosselin's salary continues in the event of
his disability and for two years after his death. He is also entitled to a lump
sum severance payment equivalent to 2.99 times his current salary in the event
of his termination as President or Chief Executive Officer within eighteen
months after a "change of control" of the Company, including, among other
events, certain types of mergers and other business combinations, material
changes in the composition of the Board of Directors or the beneficial ownership
of the Common Stock, the sale of substantially all of the Company's assets or
securities and the material downsizing or dissolution of the Company. If such an
event occurs during fiscal 1997, Mr. Gosselin would be entitled to receive
$627,900 as a severance payment.
The Company's employment agreement with Cynthia L. Gosselin commenced
on July 20, 1994, and continues through August 31, 1999. The agreement provides
for the payment to her of a base salary of $62,500 during each one-year period
ended July 20, 1996, 1997 and 1998, and annual increases in the discretion of
the Board of Directors. Pursuant to the employment agreement, Ms. Gosselin is
required to be reimbursed by the Company for her expenses incurred in connection
with the performance of her responsibilities. In the event of her death or
disability, the agreement provides for Ms. Gosselin's salary to continue for six
months thereafter. She is also entitled to participate in any Company health,
life insurance, group medical, disability income insurance and/or stock option
plan. Ms. Gosselin's employment agreement provides that she is entitled to a
lump sum severance payment equivalent to 2.99 times her current salary in the
event of her termination as Chief Financial Officer within eighteen months after
a "change in control" of the Company, as defined in the Company's Employment
Agreement with Mr. Albert E. Gosselin, Jr., described hereinabove. She would be
entitled to receive a severance payment of $216,775 if a change in control of
the Company occurs during fiscal 1997.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of March 23, 1996,
regarding the ownership of the Company's Common Stock by each shareholder known
by the Company to be the beneficial owner of more than five percent of its
outstanding shares of Common Stock, each director and all executive officers and
directors as a group. Except as otherwise indicated, each of the shareholders
has sole voting and investment power with respect to the shares of Common Stock
beneficially owned.
<TABLE>
<CAPTION>
Name and Address of Beneficial Owner (1) Amount Beneficially Owned Percent of Class (2)
- ---------------------------------------- ------------------------- --------------------
<S> <C> <C>
Fenway Advisory Group (Neil Sullivan) 650,000 (3) 6.0 %
Lee N. Sion 619,000 (4) 6.0 %
Albert E. and Barbara L. Gosselin, Jr. 501,335 (5) 5.0 %
Marcia A. Smith 101,280 (6) 1.0 %
</TABLE>
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<PAGE> 23
<TABLE>
<S> <C> <C>
Cynthia L. Gosselin 96,305 (7) 1.0%
Gary L. Dudley 85,000 (8) 1.0%
Craig E. Gosselin 45,000 (9) *
Debbie Kendrick 0 (10) *
Paul Richardson 0 (10) *
Ron Logan-Sinclair 0 (10) *
All Executive Officers and Directors as
a Group (nine persons) 828,920 8.0 %
</TABLE>
* Less than one percent
(1) The address of Fenway Advisory Group is 1901 Avenue of the Stars, 20th
Floor, Los Angeles, California 90067. The address of Mr. Lee Sion is
P.O. Box 910, Glendale, California 91209. The addresses of the rest of
the individuals named above is 506 Paula Avenue, Glendale, California
91201.
(2) Assumes the exercise of outstanding options and warrants to purchase a
total of 1,840,836 shares of the Company's Common Stock.
(3) Includes 300,000 shares of Common Stock issuable upon the exercise of
warrants owned of record by Fenway Advisory Group, but does not include
400,000 options vesting June 4, 1997.
(4) Includes 50,000 shares of Common Stock issuable upon the exercise of
options owned of record by Lee N. Sion which is exercisable within 60
days, but does not include 37,500 options vesting January 9, 1998.
(5) Includes 170,000 shares of Common Stock issuable upon the exercise of
an option owned of record by Albert E. Gosselin, Jr. exercisable within
60 days, but does not include 123,000 shares vesting January 7, 1998.
Does not include a total of 169,133 shares of Common Stock owned of
record collectively by Craig. E., Cynthia L., Keith A. and Jennifer S.
Gosselin, the adult children of Albert E. and Barbara Gosselin, Jr., as
to which Mr. and Mrs. Gosselin disclaim any beneficial ownership. Mr.
and Mrs. Gosselin hold their shares of Common Stock as community
property and exercise joint voting and investment power with respect to
such shares.
(6) Includes 40,000 shares of Common Stock issuable upon the exercise of an
option owned of record by Marcia Smith, but does not include 20,000
shares vesting January 9, 1998.
(7) Cynthia L. Gosselin is the adult daughter of Albert E. and Barbara L.
Gosselin, Jr., who disclaim any beneficial ownership of her shares and
includes 40,000 shares of Common Stock issuable upon the
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<PAGE> 24
exercise of an option owned of record and exercisable within 60 days, but
does not include 20,000 options vesting January 7, 1998.
(8) Represents 85,000 shares of Common Stock issuable upon the exercise of
options owned of record by Gary L. Dudley which is exercisable within 60
days, but does not include 20,000 options vesting January 7, 1998.
(9) Craig E. Gosselin is the adult son of Albert E. and Barbara L. Gosselin,
Jr., who disclaim any beneficial ownership of his shares and includes
40,000 shares of Common Stock issuable upon the exercise of an option owned
of record and exercisable within 60 days but does not include 20,000
options vesting January 7, 1998.
(10) A total of 370,000 options vesting January 7, 1998 owned of record by
Debbie Kendrick - 30,000, Paul Richardson - 40,000, Ron Logan-Sinclair
- 270,000, and Howard George Vincent Cooke - 30,000.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There were no transactions during the last two fiscal years ended December
31, 1995 and 1996, or proposed transactions, to which the Company was or is to
be a party, in which any executive officer or director of the Company, any
shareholder known by the Company to be the beneficial owner of more than five
percent of its outstanding shares of Common Stock or any member of the immediate
family of any of the foregoing, had or is to have a direct or indirect material
interest.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-KA
(a) EXHIBITS
The exhibits listed in the Exhibit Index located at Pages E-1
through E-9 are filed pursuant to Item 13(a) of this Report.
(b) REPORTS ON FORM 8-KA
The Company filed a Current Report on Form 8-KA on June 14,
1996 to report the issuance of 2,000,000 options for a one year
contract with a public relations firm.
The Company filed a Current Report on Form 8-KA on July 3,
1996 to report the acquisition of Nutek, Inc. Amendment #1 filed
furnishing financial information on Nutek on August 29, 1996.
The Company filed a Current Report on Form 8-KA on January 9, 1997 to
report a change in accounting firm.
24
<PAGE> 25
Board of Directors
Pollution Research and Control Corp.
Glendale, California
INDEPENDENT AUDITORS' REPORT
We have audited the accompanying consolidated balance sheet of
Pollution Research and Control Corp. and Subsidiaries as of December 31, 1996,
and the related consolidated statements of operations, changes in shareholders'
equity and cash flows for the year then ended. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
Pollution Research and Control Corp. and Subsidiaries as of December 31, 1996,
and the consolidated results of its operations and its cash flows for the year
then ended in conformity with generally accepted accounting principles.
/s/ A.J. Robbins, P.C.
February 15, 1997 A.J. Robbins, P.C.
Certified Public Accountants and Consultants
Denver, Colorado
F-1
<PAGE> 26
Greenberg & Jackson
An Accountancy Corporation
2950 Los Feliz Blvd., Suite 103
Los Angeles, California 90039
Telephone (213) 666-7700 Facsimile: (213) 666-3495
Bradford N. Bernstein, CPA Internet: [email protected]
Leslie Smith Sobol, CPA
Peggy Howard
Susan Hatfield
Ron L. Rogers, EA
To the Board of Directors
Pollution Research and Control Corp.
Glendale, California
We have audited the accompanying consolidated statements of operations,
shareholders' equity and cash flows of Pollution Research and Control Corp. and
Subsidiaries (the "Company") for the year ended December 31, 1995. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the consolidated statements of operations and
shareholders' equity and cash flows referred to above present fairly, in all
material respects, the consolidated results of operations and cash flows of the
Company for the year ended December 31, 1995 and its consolidated changes in
shareholders' equity for the year ended December 31, 1995 in conformity with
generally accepted accounting principles.
/s/ Greenberg & Jackson
Greenberg & Jackson
An Accountancy Corporation
Los Angeles, California
March 6, 1996
F-2
<PAGE> 27
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
As of December 31, 1996
ASSETS
<TABLE>
<S> <C>
CURRENT ASSETS:
Cash $ 723,170
Marketable securities 99,000
Accounts receivable, trade, less allowance for doubtful accounts of $46,381 1,710,970
Inventories 2,575,252
Other current assets 21,046
-----------
Total Current Assets 5,129,438
-----------
PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, less accumulated
depreciation and amortization of $205,884 1,650,563
-----------
OTHER ASSETS:
Goodwill, less accumulated amortization of $4,265 288,212
Loan costs, less accumulated amortization of $15,137 75,687
Other intangible assets, less accumulated amortization of $5,100 35,409
Other assets 17,634
-----------
Total Other Assets 416,942
-----------
TOTAL ASSETS $ 7,196,943
===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable $ 553,658
Accounts payable, trade 967,963
Accounts payable to officer 8,710
Accrued liabilities 224,099
Customer advances 50,820
Income taxes payable 9,800
Current portion of long-term debt 186,741
Current portion of long-term debt, related party 5,413
-----------
Total Current Liabilities 2,007,204
-----------
LONG-TERM DEBT, less current portion 667,596
LONG-TERM DEBT, related parties, less current portion 368,801
DEFERRED RENT 99,203
DEFERRED INCOME TAXES 55,000
COMMITMENTS AND CONTINGENCIES --
SHAREHOLDERS' EQUITY:
Preferred stock, no par value, 20,000,000 shares authorized, none issued and outstanding --
Common stock, no par value, 30,000,000 shares authorized, 8,673,732 issued and outstanding 6,588,980
Less notes due from sale of stock (86,857)
Other paid-in capital 145,764
Accumulated deficit (2,794,573)
Unrealized gain on marketable securities 99,000
Unrealized foreign currency translation gain 46,825
-----------
Total Shareholders' Equity 3,999,139
-----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 7,196,943
===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
F-3
<PAGE> 28
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1996 and 1995
<TABLE>
<CAPTION>
1996 1995
----------- -----------
<S> <C> <C>
NET REVENUES $ 8,805,011 $ 5,515,505
COST OF GOODS SOLD 6,463,208 3,664,504
----------- -----------
GROSS PROFIT 2,341,803 1,851,001
----------- -----------
OPERATING EXPENSES:
Selling, general and administrative 2,277,785 2,043,741
Research and development 136,356 238,345
Loss on joint venture investment -- 164,605
----------- -----------
Total Operating Expenses 2,414,141 2,446,691
----------- -----------
LOSS FROM OPERATIONS (72,338) (595,690)
----------- -----------
OTHER INCOME (EXPENSE):
Gain on sale of marketable securities 570,435 --
Interest income 6,431 3,961
Interest expense (130,616) (5,589)
Interest expense, related parties (15,500) --
----------- -----------
Total Other Income (Expense) 430,750 (1,628)
----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES 358,412 (597,318)
----------- -----------
PROVISION (BENEFIT) FOR INCOME TAXES:
Current 10,000 --
Deferred (292,000) --
----------- -----------
Total Provision (Benefit) for Income Taxes (282,000) --
----------- -----------
NET INCOME (LOSS) $ 640,412 $ (597,318)
=========== ===========
EARNINGS PER SHARE:
Primary:
Net income (loss) per share $ 0.08 $ (0.09)
=========== ===========
Weighted average number of common and common equivalent
shares outstanding 7,897,013 6,932,662
=========== ===========
Fully Diluted:
Net income (loss) per share $ 0.08 $ (0.09)
=========== ===========
Weighted average number of common and common equivalent
shares outstanding 7,900,074 6,932,662
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
F-4
<PAGE> 29
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
For the Years Ended December 31, 1996 and 1995
<TABLE>
<CAPTION>
Unrealized
Unrealized Foreign
Notes Due Other Gain on Currency Total
Common Stock From Sale Paid-In Accumulated Marketable Translation Shareholders'
Shares Amount of Stock Capital Deficit Securities Gain Equity
------ ------ -------- ------- ------- ---------- ---- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
BALANCE,
December 31, 1994 6,932,662 $ 5,431,623 $ (86,857) $ -- $(2,837,667) $ -- $ -- $ 2,507,099
Unrealized gain on
marketable securities -- -- -- -- -- 100,000 -- 100,000
Net loss for year -- -- -- -- (597,318) -- -- (597,318)
--------- ----------- ----------- --------- ----------- --------- ------- -----------
BALANCE,
December 31, 1995 6,932,662 5,431,623 (86,857) -- (3,434,985) 100,000 -- 2,009,781
Sale of common
stock, less
related costs
of $16,000 1,350,003 884,000 -- -- -- -- -- 884,000
Exercise of options
and warrants 391,067 273,357 -- -- -- -- -- 273,357
Stock-based
compensation
expense recognized -- -- -- 145,764 -- -- -- 145,764
Unrealized gain on
marketable securities -- -- -- -- -- 74,250 -- 74,250
Realized gain on
marketable securities -- -- -- -- -- (75,250) -- (75,250)
Unrealized foreign
currency translation
gain -- -- -- -- -- -- 46,825 46,825
Net income for year -- -- -- -- 640,412 -- -- 640,412
--------- ----------- ----------- --------- ----------- --------- ------- -----------
BALANCE,
December 31, 1996 8,673,732 $ 6,588,980 $ (86,857) $ 145,764 $(2,794,573) $ 99,000 $ 46,825 $ 3,999,139
========= =========== =========== =========== =========== =========== ========= ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
F-5
<PAGE> 30
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 1996 and 1995
<TABLE>
<CAPTION>
1996 1995
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Reconciliation of Net Income (Loss) to Net Cash Flows Provided by
(Used in) Operating Activities:
Net income (loss) $ 640,412 $ (597,318)
Depreciation and amortization 128,079 175,859
Deferred income taxes (292,000) --
Stock-based compensation expense 121,406 --
Loss on joint venture investment -- 164,605
Loss on disposal of equipment -- 18,061
Changes in operating assets and liabilities:
Accounts receivable, trade, net (789,107) 514,448
Inventories 358,560 73,086
Other current assets 20,571 (8,579)
Accounts payable (155,505) 14,726
Accounts payable to officer 8,710 --
Accrued liabilities (122,093) (135,234)
Unearned revenue (150,810) --
Income taxes payable 9,800 --
Deferred rent (2,534) 9,689
Other assets (11,298) 3,910
----------- -----------
Net Cash Flows Provided by (Used in) Operating Activities (235,809) 233,253
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, equipment and leasehold improvements (53,023) (41,774)
Investment in patent (23,509) --
Investment in joint venture -- (164,605)
Cash paid for acquisition of subsidiaries, net of cash
acquired of $208,054 (379,870) --
----------- -----------
Net Cash Flows Used in Investing Activities (456,402) (206,379)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock, net of expenses of $16,000 1,157,357 --
Advances on notes payable 2,805,095 150,000
Payments on notes payable (3,026,909) --
Reductions of long-term debt (163,355) --
----------- -----------
Net Cash Flows Provided by Financing Activities 772,188 150,000
----------- -----------
EFFECT OF EXCHANGE RATE CHANGES ON CASH 1,498 --
----------- -----------
INCREASE IN CASH 81,475 176,874
CASH, BEGINNING OF YEAR 641,695 464,821
----------- -----------
CASH, END OF YEAR $ 723,170 $ 641,695
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
F-6
<PAGE> 31
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
NOTE 1 - GENERAL
Pollution Research and Control Corp., a California corporation, primarily
designs, manufactures and markets air pollution monitoring instruments,
electrical control panels, and medical instrumentation through its wholly-owned
subsidiaries Dasibi Environmental Corporation ("Dasibi"), Nutek, Inc. ("Nutek"),
and Logan Medical Devices, Inc. ("LMD"), respectively. Nutek and LMD were
acquired in June, 1996 (see Note 8, below). Dasibi currently accounts for
approximately 50% of consolidated revenues, Nutek 45%, and LMD 5%.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Consolidation - The consolidated financial statements include the accounts of
Pollution Research and Control Corp. and its wholly owned subsidiaries (the
"Company"). All significant intercompany balances and transactions have been
eliminated in consolidation.
Revenue Recognition - Revenue is recognized upon shipment of products.
Inventories - Inventories are stated at the lower of cost or market. Cost is
determined on the first-in first-out (FIFO) basis.
Property, Equipment and Leasehold Improvements and Depreciation - Property,
equipment and leasehold improvements are stated at cost less accumulated
depreciation and amortization. Depreciation is provided for on the straight-line
method over the estimated useful lives of the assets, generally five to ten
years. Amortization of leasehold improvements is over the shorter of the life of
the lease or 5 years. Total depreciation expense was $107,422 and $42,215 for
the years ended December 31, 1996 and 1995, respectively.
Goodwill - The goodwill was recorded in connection with the acquisition of Logan
Medical Devices, Inc. discussed in Note 8 below, and is being amortized on a
straight-line basis over 40 years. Amortization of goodwill was $4,265 for the
year ended December 31, 1996.
Stock-Based Compensation - During 1996 the Company adopted Statement of
Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" ("SFAS 123"). The new standard required the Company to adopt the
"fair value" method with respect to stock-based compensation of consultants and
other non-employees. The Company did not change its method of accounting with
respect to employee stock options; the Company continues to account for these
under the "intrinsic value" method, and to furnish the pro-forma disclosures
required by SFAS 123. See Notes 11 and 12 for additional information with
respect to stock-based compensation.
Earnings per Share - Earnings per share is computed by dividing net income or
loss by the weighted average number of common and common equivalent shares
(options and warrants) outstanding during the period. Options and warrants which
are dilutive are included as common equivalents under the treasury stock method,
unless the dilutive options and warrants would, if exercised, generate proceeds
sufficient to repurchase more than 20% of the Company's outstanding common stock
at market prices, in which case the modified treasury stock method applies.
During the year ended December 31, 1996 there were not a sufficient number of
dilutive options and warrants to cause application of the modified treasury
stock method. During the year ended December 31, 1995, no options and warrants
were included as common equivalents because the effect was anti-dilutive.
Cash Equivalents - For purposes of reporting cash flows, the Company considers
all funds with original maturities of three months or less to be cash
equivalents.
F-7
<PAGE> 32
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 2 (continued) -
Fair Value of Financial Instruments - The carrying amounts of cash, accounts
receivable, accounts payable and accrued expenses approximate fair value because
of the short maturity of these items. The fair value of the lines of credit
approximate market because the interest rates on all of these instruments adjust
on a periodic basis with the market. The fair value of various notes payable
were estimated based on market values for debt with similar terms. Management
believes that the fair value of that debt approximated its carrying value. The
fair value of notes payable to related parties cannot be determined due to the
terms under which these instruments were negotiated.
Investments in Equity Securities - Management determines the appropriate
classification of its investments in equity securities at the time of purchase
and reevaluates such determinations at each balance sheet date. The Company has
classified its investment portfolio as available for sale. Available for sale
securities are stated at fair market value with unrealized gains and losses
included as a separate component of shareholders' equity. Realized gains and
losses are included in earnings and are derived using the specific
identification method.
Translation of Foreign Currencies - The translation of foreign currencies into
U.S. dollars is performed for balance sheet accounts using current exchange
rates in effect at the balance sheet date and for revenue and expense accounts
using an average exchange rate for the period. The gains or losses resulting
from translation are included in shareholders' equity.
Research and Development Costs - Research and development costs are charged to
operations as incurred.
Income Taxes - The Company adopted Statement of Financial Accounting Standards
No. 109, "Accounting for Income Taxes" ("SFAS 109") effective January 1, 1991.
Under this method, deferred income taxes are recorded to reflect the tax
consequences in future years of temporary differences between the tax basis of
the assets and liabilities and their financial statement amounts at the end of
each reporting period. Valuation allowances will be established when necessary
to reduce deferred tax assets to the amount expected to be realized. Income tax
expense is the tax payable for the current period and the change during the
period in deferred tax assets and liabilities. The deferred tax assets and
liabilities have been netted to reflect the tax impact of temporary differences.
The adoption of SFAS 109 did not have a material effect on the Company's
financial statements.
Use of Estimates in the Preparation of Financial Statements - The preparation of
financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and revenues and expenses
during the reporting period. Actual results could differ from those estimates.
Reclassification - Certain amounts reported in the Company's financial
statements for the year ended December 31, 1995 have been reclassified to
conform to the current year presentation.
NOTE 3 - MARKETABLE SECURITIES
In earlier years the Company had entered into a series of transactions with
Converging Systems, Inc. ("CSI") resulting in the acquisition of shares in CSI.
As a result of subsequent merger and acquisition activity of CSI, this
investment became 400,000 shares of Atlanta Technology Group, Inc. (ATYG), whose
shares are traded on the NASDAQ Bulletin Board. The acquisition cost was $1
million. Because at the time of the transactions CSI had not yet generated
significant operating revenues, and because a significant portion of CSI's
assets at the time consisted of common stock of the Company held by CSI, a
carrying value of zero was assigned to the shares.
F-8
<PAGE> 33
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 3 (continued) -
At December 31, 1995 the shares were available for sale; management estimated
the market value of the shares to be $100,000 and recorded that amount as
marketable securities (with a corresponding credit to shareholders' equity) at
December 31, 1995.
During 1996 the Company sold 301,000 of the ATYG shares, realizing net proceeds
and a gain of $570,435. The remaining 99,000 shares are carried on the balance
sheet at an estimated market value of $99,000 at December 31, 1996. At December
31, 1996, the cost of the shares is considered to be $24,750 and the unrealized
holding gain $74,250.
NOTE 4 - INVENTORIES
Inventories at December 31, 1996 consisted of the following:
<TABLE>
<S> <C>
Raw materials $1,587,232
Work in process 859,925
Finished goods 128,095
----------
Total $2,575,252
==========
</TABLE>
Inventories at December 31, 1996 include overhead of $363,211.
NOTE 5 - PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Property, equipment and leasehold improvements at December 31, 1996 consisted of
the following:
<TABLE>
<S> <C>
Machinery and equipment $1,387,363
Furniture and fixtures 144,357
Leasehold improvements 324,727
----------
1,856,447
Less accumulated depreciation
and amortization 205,884
----------
Net property, equipment and leasehold
improvements $1,650,563
==========
</TABLE>
F-9
<PAGE> 34
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 6 - ACCRUED LIABILITIES
Accrued liabilities at December 31, 1996 consisted of the following:
<TABLE>
<S> <C>
Accrued payroll and related taxes $142,837
Accrued interest 26,269
Current portion of deferred rent 23,012
Accrued legal and professional fees 21,364
Other 10,617
--------
Total $224,099
========
</TABLE>
NOTE 7 - DEFERRED RENT
Upon execution of a 10-year lease for its present facility in Glendale,
California commencing July 1, 1994, the Company was granted 6 months' "free"
rent. Upon the acquisition of Nutek, Inc. effective June 20, 1996 discussed in
Note 8 below, the Company executed a five-year lease with increasing minimum
rental amounts on each anniversary date. As required by generally accepted
accounting principles, rent expense is being recognized by amortizing the total
minimum rentals payable under the leases over the terms of the leases on a
straight-line basis. The deferred rent shown on the balance sheet as of December
31, 1996 represents the excess of the total amount charged to rent expense over
the amounts actually due and payable under the leases as of such date, of which
$21,364 has been classified as current and $99,203 as long-term.
NOTE 8 - ACQUISITIONS
Effective June 20, 1996, the Company acquired 100% of the outstanding stock of
Nutek, Inc. ("Nutek"), a Florida-based company primarily engaged in the design,
manufacture and marketing of electrical control panels for automation use in
utility and industrial applications. The Company paid $304,000 (inclusive of
acquisition costs) and incurred or assumed an additional $1,593,000 in debt, for
a total purchase price including the assumption of debt of $1,897,000. The
acquisition was accounted for as a purchase. Current assets and liabilities were
recorded at their fair values, with the remaining purchase price of $1,525,000
assigned to property and equipment.
In connection with the acquisition, the Company granted 340,000 common stock
options at $1.10 per share to various consultants and employees of Nutek (above
market on the date of the grant) (see Note 11). Additionally, loan costs of
$91,000 were incurred in connection with the financing of the acquisition (see
Note 9); the loan costs are being amortized over the three year term of the
credit facility.
The Company had worked with London-based Logan Research Limited ("LRL") since
1993 in the development of medical technology applications of the Company's
instrumentation for the measurement of oxides of nitrogen. In 1995, $164,000 was
advanced to LRL; this amount was charged to operations as a "loss on joint
venture investment" in 1995, as the required additional funding for this venture
had not been located at that time.
Effective June 1, 1996 the Company acquired 100% of the outstanding common stock
of Logan Medical Devices, Inc., a Colorado Corporation ("LMD") and its
wholly-owned subsidiary Logan Research Limited of Rochester, Kent, England, a
private United Kingdom company limited by shares ("LRL"). LMD and LRL are
primarily engaged in the design, manufacture and marketing of medical
instrumentation internationally. The Company issued 600,500 options to purchase
its common stock at $1.10 per share (above market on the issue date) in exchange
for the 1,201,000 shares (80.1%) of LMD it did not already own. Additionally,
the Company made a $250,000 capital contribution to LMD, and LMD issued $300,000
in notes to the former shareholders of LRL in payment for 100% of the
outstanding stock of LRL. The total amount paid was $287,000 inclusive of
acquisition costs, and including the $300,000 in notes issued the total purchase
price was $587,000.
F-10
<PAGE> 35
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 8 (continued) -
This acquisition was also accounted for as a purchase. Current assets, property
and equipment and liabilities were recorded at their fair values, with the
remaining purchase price of $292,000 assigned to goodwill. The goodwill is being
amortized on a straight-line basis over 40 years. Additionally, the Company
entered into an employment contract with Mr. Ronald Bruce Logan-Sinclair,
President of LMD and LRL (see Note 13).
Unaudited pro-forma summary results of operations for the years ended December
31, 1996 and 1995, presented as if the acquisitions of Nutek and LMD had taken
place January 1, 1995, are presented below:
<TABLE>
<CAPTION>
1996 1995
---------- ------------
(Unaudited) (Unaudited)
<S> <C> <C>
Revenues $10,623,000 $ 7,731,000
=========== ============
Net income (loss) $ 570,000 $ (1,020,000)
=========== ============
Earnings (loss) per share $ 0.07 $ (0.15)
=========== ============
</TABLE>
Pro-forma adjustments have been included primarily for interest expense and
depreciation.
NOTE 9 - NOTES PAYABLE AND LONG-TERM DEBT
Notes Payable -
In June 1996 the Company entered in to an extension of its line of credit
agreement with a bank, which provides borrowings of up to $200,000 through June
3, 1997. The line of credit had a temporary increase to $300,000 during latter
1996. Borrowings under this agreement bear interest at the bank's prime rate
plus 2% (10 1/4% at December 31, 1996) and are collateralized by substantially
all of the Company's assets. The agreement contains several restrictive
covenants common to lines of credit, including certain tangible net worth and
current ratio requirements. The balance outstanding at December 31, 1996 was
$190,000.
In connection with the acquisition of Nutek described above, Nutek obtained a
working capital facility from an asset-based lender for the lesser of $1,000,000
or the borrowing base (as defined). A total of $535,000 was advanced in
connection with the acquisition; $363,658 was outstanding at December 31, 1996.
The note bears interest at the large commercial bank prime rate plus 2 1/2% (10
3/4% at December 31, 1996) and matures June 28, 1999. Substantially all of
Nutek's assets are pledged as collateral for this loan and for the term loan
described below, which was obtained from the same asset-based lender. The
related Loan and Security Agreement contains numerous restrictive covenants
common to asset-based financing, including the requirement to maintain specified
levels of debt service coverage, working capital, tangible net worth, and
profitability, and restrictions on additional borrowings, the payment of
dividends, and limitations on payments to affiliates including the parent
company. Additionally, the parent company has guaranteed these loans.
Logan Research Limited has a secured overdraft facility with an English bank of
up to (pound)60,000 (approximately $100,000 at current exchange rates). Amounts
borrowed under the facility bear interest at the reference rate plus 3%
(currently 9%). The facility expires and must be "reviewed" March 31, 1997. The
facility is secured by substantially all of the assets of LRL and by the
residences of Messrs. R. B. Logan-Sinclair and H. G. V. Cooke, officers and/or
directors of LMD and LRL and the former shareholders of LRL. No amounts were
outstanding as of December 31, 1996.
F-11
<PAGE> 36
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 9 (continued) -
Long-Term Debt -
Long-term debt at December 31, 1996 consisted of the following:
<TABLE>
<S> <C>
Nutek, Inc.
Term loan $687,500
Notes payable to former shareholders 100,000
Installment loans 66,837
--------
854,337
Less current portion 186,741
--------
Long-term debt $667,596
========
</TABLE>
Nutek's term loan bears interest at the large commercial bank prime
rate plus 3 1/2% (11 3/4% at December 31, 1996). Monthly payments of $12,500
plus interest are required until June 28, 1999, at which time the remaining
balance is due. The term loan was received from the same asset-based lender who
provided Nutek's working capital facility--see the description of Nutek's
working capital facility above.
The notes payable to Nutek's former shareholders bear interest at 8%. Monthly
interest-only payments are required until June 30, 1997, after which time the
principal and interest is payable in 48 equal monthly installments aggregating
$2,442. The notes are unsecured.
The installment loans bear interest at rates ranging from 6-1/2% to 9% (the
commercial bank prime rate plus 3/4%) and mature at various times from February
1997 to April 2000. The loans are secured by purchase money liens on the related
assets.
Long-Term Debt, Related Parties -
Long-term debt, related parties at December 31, 1996, consisted of the
following:
<TABLE>
<S> <C>
Nutek, Inc. - Notes payable to family member of employee $ 50,000
Logan Medical Devices, Inc. - Notes payable to officers 300,000
Logan Research Limited - Advances from officer 24,214
---------
374,214
Less current portion (5,413)
---------
Long-term debt, related parties $ 368,801
=========
</TABLE>
The note payable to a family member of an employee was part of the financing of
the acquisition of Nutek, and was issued to a former stockholder of Nutek who is
the father of a current officer of the Company's Nutek subsidiary. The note
bears interest at 8%. Monthly interest-only payments are required until June 30,
1997, after which time the principal and interest is payable in 48 equal monthly
installments of $1,221. The note is unsecured.
F-12
<PAGE> 37
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 9 (continued) -
The notes payable to officers/employee of Logan Medical Devices, Inc. were
issued to two individuals in payment for 100% of the outstanding stock of Logan
Research Limited in connection with the acquisition, who became officers of
Logan Medical Devices, Inc. upon acquisition. The notes bear interest at 9%.
Quarterly payments of accrued interest are required commencing June 30, 1998.
The notes are redeemable by the Company at any time after December 28, 1996, and
are callable by the holders at any time after June 28, 1998. The notes are
secured by substantially all of the assets of LMD and LRL.
The advances from an officer of LRL are represented by an open advance account.
Management does not expect to repay the amount in the foreseeable future.
Scheduled maturities of long-term debt are as follows:
<TABLE>
<CAPTION>
Related
Total Parties Others
---------- ---------- ----------
<S> <C> <C> <C>
1997 $ 192,154 $ 5,413 $ 186,741
1998 506,642 311,496 195,146
1999 439,967 12,451 427,516
2000 44,107 13,483 30,624
2001 21,467 7,157 14,310
Thereafter 24,214 24,214 --
---------- ---------- ----------
$1,228,551 $ 374,214 $ 854,337
========== ========== ==========
</TABLE>
NOTE 10 - INCOME TAXES
The income tax provision (benefit) for the years ended December 31, 1996 and
1995 differs from the computed expected provision (benefit) at the federal
statutory rate of 35% for the following reasons:
<TABLE>
<CAPTION>
1996 1995
--------- ---------
<S> <C> <C>
Computed expected income tax provision (benefit) at 35% $ 125,000 $(209,000)
Non-deductible meals & entertainment 8,000 2,000
Temporary differences for items deductible from (includible in)
taxable income in future years:
Stock-based compensation expense 43,000 --
Depreciation 22,000 3,000
Inventory valuation allowance 3,000 --
Incomplete contracts (29,000) --
Loss on joint venture investment -- 58,000
Other 1,000 1,000
State income taxes, net of federal income tax effect 22,000 (21,000)
Net operating loss carryforward unutilized (utilized) (195,000) 166,000
Alternative minimum tax 10,000 --
Reduction to valuation allowance (292,000) --
--------- ---------
Income tax provision (benefit) $(282,000) $ --
========= =========
</TABLE>
F-13
<PAGE> 38
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 10 (continued) -
The components of the deferred tax assets and liabilities as of December 31,
1996 were as follows:
<TABLE>
<S> <C>
Deferred tax assets:
Temporary differences:
Allowance for doubtful accounts $ 17,000
Inventory valuation allowance 31,000
Incomplete contracts 25,000
Accrued expenses 15,000
Stock-based compensation 48,000
Loss on joint venture investment 66,000
Tax depreciation in excess of book depreciation 10,000
Net operating loss carryforward 926,000
Less valuation allowance (729,000)
---------
Long-term deferred tax assets after valuation allowance 409,000
Deferred tax liability:
Excess of basis of Nutek's property and equipment for
financial reporting purposes over tax basis (464,000)
---------
Net long-term deferred tax liability $ (55,000)
=========
</TABLE>
The components of the deferred tax expense were as follows:
<TABLE>
<CAPTION>
1996 1995
--------- ---------
<S> <C> <C>
Stock-based compensation expense $ (48,000) $ --
Allowance for doubtful accounts (14,000) --
Inventory valuation allowance (29,000) --
Incomplete contracts (26,000) --
Loss on joint venture investment -- (66,000)
Other (6,000) (2,000)
Depreciation (24,000) (3,000)
Book/tax basis difference in Nutek's
fixed assets at acquisition 494,000 --
Deferred tax liability of Nutek at
acquisition (347,000) --
Utilization of net operating loss
carryforward 153,000 --
Change in valuation allowance (445,000) 71,000
--------- ---------
$(292,000) $ --
========= =========
</TABLE>
As of December 31, 1996 the Company has net operating loss carryforwards
available to offset future taxable income of approximately $2,300,000 expiring
in 2004 through 2010.
F-14
<PAGE> 39
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 11 - SHAREHOLDERS' EQUITY
Issuance of Common Stock - On June 24, 1996 the Company sold in a private
placement 1,000,003 units consisting of one share of common stock and one
warrant to purchase the Company's common stock at $1.00 per share (above market
on the date of sale) (see below), receiving net proceeds of $584,000. On
September 20, 1996, the Company completed a private placement consisting of
350,000 shares of common stock and warrants to purchase 300,000 shares of common
stock at $1.50 per share (above market on the date of sale) (see below),
receiving net proceeds of $300,000. Total issue costs of the private placements
were $16,000. Additionally, in 1996 the Company received net proceeds of
$273,357 from the exercise of an aggregate of 391,067 options and warrants (see
below) and accordingly issued 391,067 shares.
Warrants -
In earlier years the Company had issued an aggregate of 827,500 warrants to
consultants, lenders, and investors in private placements at exercise prices
ranging from $1.58 to $2.00 per share. The original expiration dates of these
warrants were extended to November 30, 1995, on which date the 827,500 warrants
expired.
In July 1989 the Company issued 1,453,497 warrants to purchase its common stock
at $1.75 per share as part of units sold in a public offering. Additionally,
there were outstanding 652,501 warrants at an exercise price of $1.75 per share
which had been originally issued to the Underwriter. These 2,105,998 warrants
were publicly traded in earlier years. The Board of Directors approved the
extension of the expiration date of the warrants until March 29, 1996 at an
exercise price of $0.60 per share. In March, 1996, 266,900 of the warrants were
exercised, and the remaining 1,839,098 warrants expired March 29,1996.
On June 11, 1996, 25,000 warrants issued in 1991 to purchase the Company's
common stock at $0.69 per share were exercised.
In connection with the June 24, 1996 private placement described above,
1,000,003 warrants to purchase the Company's common stock at $1.00 per share
were issued, expiring June 14, 1999. In November 1996 89,167 of the warrants
were exercised; 910,836 were outstanding at December 31, 1996.
In connection with the September 20, 1996 private placement described above, the
company issued 300,000 warrants to purchase the Company's common stock at $1.50
per share, expiring September 20, 1999.
Additionally, at December 31, 1996 there were 60,000 warrants outstanding to
purchase the Company's common stock at $1.70 per share expiring August 31, 1998,
and 5,000 warrants at $2.00 per share expiring November 7, 1998.
Options -
On June 29, 1995 the Company granted options to various employees to purchase
30,000 shares of common stock at $0.63, expiring June 28, 2000. In January,
1996, 5,000 of the options were canceled due to an employee's departure; 25,000
remain outstanding. The Company had also granted 160,000 options at $0.63 to
officers, directors and key employees on June 29, 1995; the 160,000 options were
canceled May 31, 1996.
On July 1, 1995 the Company granted an employee options to purchase 25,000
shares at $1.38, expiring June 30, 1998.
On July 10, 1995, the Company granted options to a consulting firm to purchase
500,000 shares at $0.70 per share. The options were canceled in January 1996 due
to non-performance.
F-15
<PAGE> 40
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 11 (continued) -
On April 1, 1996, the Company issued to a consultant options to purchase 10,000
shares at $0.68 per share. The options were exercised October 18, 1996.
On May 30, 1996 the Company issued to a public relations firm options to
purchase 1,000,000 shares at $0.94 per share and 300,000 shares at $1.25 per
share. The options may be exercised beginning August 31, 1997 and expire May 29,
2000. The Company believes the public relations firm has not performed under its
contract and the options are presently in dispute.
On May 31, 1996, in connection with the acquisition of Nutek, the Company issued
options to purchase 340,000 shares at $1.10 per share to various consultants and
employees of Nutek. The options may be exercised beginning January 7, 1998 and
expire May 31, 2000.
On June 1, 1996, in connection with the acquisition of LMD, the Company
exchanged options to purchase 600,500 shares at $1.10 per share for the
1,201,000 shares of LMD it did not already own (see Note 8). The options may be
exercised beginning January 7, 1998 and expire May 31, 2000. The 600,500 options
include 123,000 issued to Mr. Albert E. Gosselin, Jr., Chief Executive Officer
and a director of the Company, 20,000 to Ms. Cynthia Gosselin, Chief Financial
Officer and a director of the Company, 20,000 to Mr. Craig Gosselin, a director
of the Company, 20,000 to Ms. Marcia Smith, a director of the Company, 20,000 to
Mr. Gary Dudley, a director of the Company, and 300,000 to Mr. Ronald
Logan-Sinclair, President of the Company's subsidiaries LMD and LRL.
Also on June 1, 1996 the Company issued options to purchase 280,000 shares at
$1.10, expiring May 31, 2000, to the officers and directors of the Company named
in the previous paragraph, as follows; Albert E. Gosselin, Jr., 120,000; Cynthia
Gosselin, 40,000; Craig Gosselin, 40,000; Marcia Smith, 40,000; Gary Dudley,
40,000. Additionally the Company granted options to purchase 40,000 shares at
$1.10 per share to Ms. Margaret Jones.
On July 1, 1996, the Company granted options to purchase 25,000 shares at $1.38
per share to an employee, expiring June 30, 1999.
On November 22, 1996, the Company granted options to purchase 400,000 shares at
$1.12 per share to a consultant. The options may be exercised beginning June 4,
1997 and expire November 4, 1999.
Additionally, the Company has outstanding options granted in 1991 to purchase
50,000 shares at $0.55 per share, expiring May 28, 2001, to Mr. Albert E.
Gosselin, Jr., Chief Executive Officer and a director of the Company, 50,000 to
Mr. Lee Sion, an owner of record of 6 % of the Company's outstanding common
stock, and 45,000 to Mr. Gary Dudley, a director of the Company. Also
outstanding at December 31, 1996 were options granted to an employee to purchase
25,000 shares at $1.38, expiring June 30, 1997.
F-16
<PAGE> 41
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 11 (continued) -
The following table summarizes the activity of options and warrants for the two
years ended December 31, 1996:
<TABLE>
<CAPTION>
Weighted
Average
Number of Exercise Exercise
Options Warrants Price Amount
------- -------- ----- ------
<S> <C> <C> <C> <C>
Outstanding, December 31, 1994 170,000 3,023,498 $ 1.65 $5,258,207
Granted 715,000 - $ 0.71 504,200
Expired - (827,500) $ 1.61 (1,329,210)
--------- ---------- -----------
Outstanding, December 31, 1995 885,000 2,195,998 $ 1.44 4,433,197
Granted 2,995,500 1,300,003 $ 1.08 4,640,853
Reduction to exercise price - - - (2,421,898)
Exercised (10,000) (381,067) $ 0.70 (273,357)
Canceled (665,000) - $ 0.68 (453,950)
Expired - (1,839,098) $ 0.60 (1,103,459)
--------- ---------- -----------
Outstanding, December 31, 1996 3,205,500 1,275,836 $ 1.08 $ 4,821,386
========= ========== ===========
</TABLE>
At December 31, 1996, the Company had a total of 4,481,336 options and warrants
outstanding, at exercise prices ranging from $0.55 to $2.00, with a weighted
average remaining contractual term of 3.1 years.
The Company filed a registration statement on Form S-3 on June 7, 1995 to
register the shares underlying 3,053,497 warrants and 170,000 options. A
post-effective amendment was filed February 26, 1996 to adjust the number of
shares registered to equal shares underlying 2,170,998 warrants and 320,000
options. A Form S-3 was filed October 15, 1996 to register 1,375,003 shares of
common stock and the shares underlying an additional 1,875,000 options and
1,365,003 warrants.
NOTE 12 - STOCK-BASED COMPENSATION
During 1996 the Company adopted Statement of Financial Accounting Standards No.
123, "Accounting for Stock-Based Compensation". The new standard required the
Company to adopt the "fair value" method with respect to stock-based
compensation of consultants and other non-employees, which resulted in a charge
to operations of $121,406 in 1996. Additionally, $24,358 was capitalized as
acquisition costs in 1996.
The Company did not change its method of accounting with respect to employee
stock options; the Company continues to account for these under the "intrinsic
value" method. Had the Company adopted the fair value method with respect to
options issued to employees as well, an additional charge to income of $104,249
would have been required in 1996; pro-forma net income would have been $536,163
and earnings per share would have been $0.07 on both a primary and fully diluted
basis.
In estimating the above expense, the Company used the Modified Black-Scholes
American pricing model. The risk-free interest rate used was 6.2%; volatility
was estimated at 71.5%; the expected life was less than one year.
F-17
<PAGE> 42
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 13 - COMMITMENTS AND CONTINGENCIES
Operating Leases - The Company leases its facilities under long-term
non-cancelable operating leases. The lease terms provide for increases in future
minimum rental payments based on the Consumer Price Index, and an option to
purchase during the lease term. The lease on the Company's facility in England
is payable to the pension trust of Ronald B. Logan-Sinclair, the President of
the Company's LMD and LRL subsidiaries. The lease on the Company's Nutek
facility is payable to a partnership in which one of the former shareholders of
Nutek and the father of a current officer of the Company's Nutek subsidiary has
an interest. Future minimum lease commitments as of December 31, 1996 are as
follows:
<TABLE>
<CAPTION>
Year Ended Total Commitments to Commitments
December 31, Commitments Related Parties to Others
------------ ----------- --------------- ---------
<S> <C> <C> <C>
1997 $ 412,259 $ 51,523 $ 360,736
1998 419,552 65,903 353,649
1999 420,405 78,698 341,707
2000 418,038 81,173 336,865
2001 378,864 42,000 336,864
Thereafter 533,368 - 533,368
---------- ---------- ----------
Total $2,582,486 $ 319,297 $2,263,189
========= ========= =========
</TABLE>
Total rentals under all operating leases charged against income amounted to
$461,500 and $375,000 for the years ended December 31, 1996 and 1995,
respectively.
Employment Agreements - The Company is obligated to make certain minimum salary
payments to Mr. Albert E. Gosselin, Jr., its Chief Executive Officer (whose
agreement expires in August 1999), Ms. Cynthia Gosselin, its Chief Financial
Officer (whose agreement expires in July 1999), and to Mr. Ronald B.
Logan-Sinclair, the President of its LMD and LRL subsidiaries (whose agreement
expires in June 1999), as follows:
<TABLE>
<CAPTION>
Year Ended Albert E. Cynthia Ronald B.
December 31, Gosselin, Jr. Gosselin Logan-Sinclair Total
----------- ------------- -------- -------------- -------
<S> <C> <C> <C> <C>
1997 $ 205,000 $ 62,500 $ 71,420 $ 338,920
1998 215,000 62,500 71,420 348,920
1999 115,000 35,000 35,710 185,710
--------- --------- --------- ---------
Total $ 535,000 $ 160,000 $ 178,550 $ 873,550
========= ========= ========= =========
</TABLE>
Contingencies - The Company is not currently involved in any legal proceedings
except for those arising in the ordinary course of business, none of which are
expected to have a material impact on the Company's financial statements in the
event of unfavorable resolution.
NOTE 14 - SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for income taxes was $-0- and $2,400 during the years ended December
31, 1996 and 1995, respectively. Cash paid for interest was $119,847 and $5,589
during the years ended December 31, 1996 and 1995, respectively.
F-18
<PAGE> 43
POLLUTION RESEARCH AND CONTROL CORP. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
For the Years Ended December 31, 1996 and 1995
(continued)
NOTE 14 (continued) -
During 1996 the Company entered into several non-cash transactions. The Company
exchanged 600,500 options for the 1,201,000 shares of Logan Medical Devices,
Inc. it did not already own in connection with the acquisition of Logan as
discussed in Note 8. Also in connection with the acquisition, LMD issued
$300,000 in notes to the former shareholders of LRL in exchange for 100% of the
outstanding stock of LRL. In connection with the acquisition of Nutek, Nutek
issued $150,000 in notes to its former shareholders as part of the purchase
price. Additionally, 100,000 stock options valued at $12,333 were capitalized as
part of the Nutek acquisition, and 97,500 stock options valued at $12,025 were
capitalized as part of the LMD acquisition.
NOTE 15 - INDUSTRY SEGMENT AND EXPORT INFORMATION
Beginning in 1996 with the acquisitions of Nutek and LMD, the Company operates
in three business segments; air pollution monitoring equipment, electrical
control panels, and medical instrumentation. Following is certain information
related to each segment for 1996:
<TABLE>
<CAPTION>
Electrical
Air Pollution Control Medical
Instruments Panels Instruments
--------------- ---------- ----------
<S> <C> <C> <C>
Revenues $ 5,672,249 $2,867,819 $ 264,943
=============== ========== ==========
Income (loss) from operations $ (328,590) $ 268,135 $ (11,883)
=============== ========== ==========
Identifiable assets $ 3,522,922 $2,966,639 $ 707,382
=============== ========== ==========
Depreciation and amortization $ 28,778 $ 91,708 $ 7,593
=============== ========== ==========
Capital expenditures $ 41,176 $ 9,757 $ 2,090
=============== ========== ==========
</TABLE>
In 1995, the Company had sales to an overseas distributor who services multiple
customers representing 16% of net sales. In 1996, no customer accounted for 10%
or more of consolidated net sales.
Export sales for the years ended December 31, 1996 and 1995 were as follows:
<TABLE>
<CAPTION>
1996 1995
---------- ----------
<S> <C> <C>
Europe and United Kingdom $ 865,586 $1,445,000
Asia and Pacific 1,200,401 1,071,000
Latin America and other 607,456 525,000
---------- ----------
Total $2,673,443 $3,041,000
========== ==========
</TABLE>
NOTE 16 - CONCENTRATION OF CREDIT RISK
Concentrations of credit risk with respect to trade receivables exist due to
large balances with a few customers. At December 31, 1996 accounts receivable
balances from two significant customers were $700,505, or 40% of the total
accounts receivable balance. Ongoing credit evaluations of customers' financial
condition are performed, and generally, no collateral is required. The Company
maintains reserves for potential credit losses, and such losses in the aggregate
have not exceeded management's expectations. Customers are located throughout
the world.
The Company maintains all cash in bank accounts, which at times may exceed
federally insured limits.
F-19
<PAGE> 44
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities and Exchange
Act of 1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: March 31, 1997 POLLUTION RESEARCH AND CONTROL CORP.
(Registrant)
By: /s/ Albert E. Gosselin, Jr.
------------------------------------------------
Albert E. Gosselin, Jr., President, Chief Executive
Officer and Chairman of the Board of Directors
In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and on the dates indicated.
Date: March 31, 1997 /s/ Albert E. Gosselin, Jr.
-----------------------------------------
Albert E. Gosselin, Jr., President, Chief
Executive Officer and Chairman of the Board
of Directors (Principle Executive Officer)
Date: March 31, 1997 /s/ Cynthia L. Gosselin
-----------------------------------------
Cynthia L. Gosselin, Chief Financial Officer
(Principle Financial and Accounting Officer)
Date: March 31, 1997 /s/ Barbara L. Gosselin
-----------------------------------------
Barbara L. Gosselin, Director
Date: March 31, 1997 /s/ Gary L. Dudley
-----------------------------------------
Gary L. Dudley, Director
Date: March 31, 1997 /s/ Marcia A. Smith
-----------------------------------------
Marcia A. Smith, Director
Date: March 31, 1997 /s/ Craig E. Gosselin
-----------------------------------------
Craig E. Gosselin, Director
<PAGE> 45
EXHIBIT INDEX
<TABLE>
<CAPTION>
ITEM
NUMBER DESCRIPTION
- ------ -----------
<S> <C>
3.1 Articles of Incorporation of A. E. Gosselin Engineering, Inc. (now
"Pollution Research and Control Corp.") (Incorporated herein by
reference to Exhibit 3(a) to the Amendment No. 1 to the Registration
Statement on Form 10 of Dasibi Environmental Corporation (now
"Pollution Research and Control Corp.")
3.2 Certificate of Amendment of Articles of Incorporation of A. E.
Gosselin Engineering, Inc. (now "Pollution Research and Control
Corp.") (Incorporated herein by reference to Exhibit 3(a) to the
Amendment No. 1 to the Registration Statement on Form 10 of Dasibi
Environmental Corporation (now "Pollution Research and Control
Corp.")
3.3 Certificate of Amendment of Articles of Incorporation of Dasibi
Environmental Corp. (now "Pollution Research and Control
Corp.")(Incorporated herein by reference to Exhibit 3(a) to the
Amendment No. 1 to the Registration Statement on Form 10 of Dasibi
Environmental Corporation (now "Pollution Research and Control
Corp.")
3.4 By-laws of A. E. Gosselin Engineering, Inc. (now "Pollution Research
and Control Corp.") (Incorporated herein by reference to Exhibit 3(a)
to the Amendment No. 1 to the Registration Statement on Form 10 of
Dasibi Environmental Corporation (now "Pollution Research and
Control Corp.")
4.1 Form of Warrant Agreement. (Incorporated herein by reference to
Exhibit 4.1 to the Registration Statement on Form S-1 (File No. 33-
26558 of Pollution Research and Control Corp., dated January 17,
1989)
4.2 Form of Unit Purchase Warrant. (Incorporated herein by reference to
Exhibit 4.2 to the Registration Statement on Form S-1 (File No. 33-
26558 of Pollution Research and Control Corp., dated January 17,
1989)
4.3 Form of Stock Purchase Warrant. (Incorporated herein by reference to
Exhibit 4.3 to the Registration Statement on Form S-1 (File No. 33-
</TABLE>
<PAGE> 46
E-1
<TABLE>
<S> <C>
26558 of Pollution Research and Control Corp., dated January 17,
1989.)
10.1 Warrant to Purchase 7,500 shares of Common Stock issued to Frost &
Company P.S. on February 10, 1987. (Incorporated herein by reference
to Exhibit 10.2 to the Registration Statement on Form S-1 (File No. 33-
26558) of Pollution Research and Control Corp., dated January 17,
1989.)
10.2 Employment Agreement, dated July 31, 1987, between Pollution
Research and Control Corp. and Albert E. Gosselin, Jr. (Incorporated
herein by reference to Exhibit 10.3 to the Registration Statement on
Form S-1 (File No. 33-26558) of Pollution Research and Control Corp.,
dated January 17, 1989)
10.3 Employees' Incentive Stock Option Plan. (Incorporated herein by
reference to Exhibit 10.4 to the Registration Statement on Form S-1
(File No. 33-26558) of Pollution Research and Control Corp., dated
January 17, 1989)
10.4 Employment Agreement, as amended, dated August 19, 1989, between
Pollution Research and Control Corp. and Albert E. Gosselin, Jr.
(Incorporated herein by reference to Exhibit 10-28 to the Annual Report
on Form 10-K for the fiscal year ended June 30, 1989)
10.5 Lease, dated July 1, 1989, between Pollution Research and Control
Corp. and Shahik Mardeross-ASL. (Incorporated herein by reference
to Exhibit 10.30 to the Annual Report on Form 10-K for the fiscal year
ended June 30, 1989)
10.6 Stock Option Agreement, dated May 28, 1991, between Pollution
Research and Control Corp. and Lee Sion. (Incorporated herein by
reference to Exhibit 10.14 to the Transition Report on Form 10-K for
the transition period ended June 30, 1991)
10.7 Stock Option Agreement, dated May 28, 1991, between Pollution
Research and Control Corp. and Albert E. Gosselin, Jr., (Incorporated
herein by reference to Exhibit 10.15 to the Transition Report on Form
10-K for the transition period ended June 30, 1991.)
10.8 Stock Option Agreement, dated May 28, 1991, between Pollution
Research and Control Corp. and Gary L. Dudley, (Incorporated herein
by reference to Exhibit 10.13 to the Transition Report on Form 10-K
for the transition period ended June 30, 1991.)
10.9 Agreement, dated November 1, 1991, between Pollution Research and
Control Corp. and KVB, Inc. (Incorporated herein by reference to
</TABLE>
E-2
<PAGE> 47
<TABLE>
<S> <C>
Exhibit 10.1 to the Quarterly Report on Form 10-Q for the
fiscal quarter ended September 30, 1991.)
10.10 Purchase Agreement, dated as of December 2, 1991, between Pollution
Research and Control Corp. and CSC Industries, Inc. and affiliated
companies Pension Plans Trust. (Incorporated herein by reference to
Exhibit 10.7 to the Amendment No. 1 to the Registration Statement on
form S-1 (File No., 33-43124) of Pollution Research and Control Corp.
dated December 23, 1991.)
10.11 Warrant, dated as of December 2, 1991, issued to CSC Industries, Inc.
and affiliated companies Pension Plans Trust. (Incorporated herein by
reference to Exhibit 10.8 to the Amendment No. 1 to the Registration
Statement on form S-1 (File No., 33-43124) of Pollution Research and
Control Corp. dated December 23, 1991.)
10.12 Purchase Agreement, dated as of December 9, 1991, between Pollution
Research and Control Corp. and Richard M. Molinsky (Incorporated
herein by reference to Exhibit 10.9 to the Amendment No. 1 to the
Registration Statement on form S-1 (File No., 33-43124) of Pollution
Research and Control Corp. dated December 23, 1991.)
10.13 Warrant, dated as of December 9, 1991, issued to Richard M.
Molinsky. (Incorporated herein by reference to Exhibit 10.10 to the
Amendment No. 1 to the Registration Statement on form S-1 (File No.,
33-43124) of Pollution Research and Control Corp. dated December 23,
1991.)
10.14 Purchase Agreement, dated as of December 11, 1991, between
Pollution Research and Control Corp. and Global Environment Fund.
(Incorporated herein by reference to Exhibit 10.11 to the Amendment
No. 1 to the Registration Statement on form S-1 (File No., 33-43124)
of Pollution Research and Control Corp. dated December 23, 1991.)
10.15 Warrant, dated as of December 11, 1991, issued to Global Environment
Fund. (Incorporated herein by reference to Exhibit 10.12 to the
Amendment No. 1 to the Registration Statement on form S-1 (File No.,
33-43124) of Pollution Research and Control Corp. dated December 23,
1991.)
10.16 Purchase Agreement, dated as of December 13, 1991, between
Pollution Research and Control Corp. and Robert A. Tantleff
(Incorporated herein by reference to Exhibit 10.13 to the Amendment
No. 1 to the Registration Statement on form S-1 (File No., 33-43124)
of Pollution Research and Control Corp. dated December 23, 1991.)
</TABLE>
E-3
<PAGE> 48
<TABLE>
<S> <C>
10.17 Warrant, dated as of December 13, 1991, issued to Robert A. Tantleff.
(Incorporated herein by reference to Exhibit 10.14 to the Amendment
No. 1 to the Registration Statement on form S-1 (File No., 33-43124)
of Pollution Research and Control Corp. dated December 23, 1991.)
10.18 Purchase Agreement, dated as of December 16, 1991, between
Pollution Research and Control Corp. and Stanley Becker. (Incorporated
herein by reference to Exhibit 10.15 to the Amendment No. 1 to the
Registration Statement on form S-1 (File No., 33-43124) of Pollution
Research and Control Corp. dated December 23, 1991.)
10.19 Warrant, dated as of December 16, 1991, issued to Stanley Becker.
(Incorporated herein by reference to Exhibit 10.16 to the Amendment
No. 1 to the Registration Statement on form S-1 (File No., 33-43124)
of Pollution Research and Control Corp. dated December 23, 1991.)
10.20 Purchase Agreement, dated as of December 16, 1991, between
Pollution Research and Control Corp. and Bruce Lynch. (Incorporated
herein by reference to Exhibit 10.17 to the Amendment No. 1 to the
Registration Statement on form S-1 (File No., 33-43124) of Pollution
Research and Control Corp. dated December 23, 1991.)
10.21 Warrant, dated as of December 16, 1991, issued to Bruce Lynch.
(Incorporated herein by reference to Exhibit 10.18 to the Amendment
No. 1 to the Registration Statement on form S-1 (File No., 33-43124)
of Pollution Research and Control Corp. dated December 23, 1991.)
10.22 Purchase Agreement, dated as of December 16, 1991, between
Pollution Research and Control Corp. and John Kilmartin.
(Incorporated herein by reference to Exhibit 10.19 to the Amendment
No. 1 to the Registration Statement on form S-1 (File No., 33-43124)
of Pollution Research and Control Corp. dated December 23, 1991.)
10.23 Warrant, dated as of December 16, 1991, issued to John Kilmartin.
(Incorporated herein by reference to Exhibit 10.20 to the Amendment
No. 1 to the Registration Statement on form S-1 (File No., 33-43124)
of Pollution Research and Control Corp. dated December 23, 1991.)
10.24 Consulting Agreement, dated January 3, 1992, between Pollution
Research and Control Corp. and Total Software, Inc. (Incorporated
herein by reference to Exhibit 10.24 to the Annual Report on
Form 10-K for the fiscal year ended December 31, 1992.)
10.25 Option Agreement, dated January 3, 1992, between Pollution Research
and Control Corp. and Total Software, Inc. (Incorporated herein by
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reference to Exhibit 10.25 to the Annual Report on Form 10-K
for the Fiscal year ended December 31, 1992.)
10.26 Option Agreement, dated March 11, 1992, between Pollution Research
and Control Corp. and Total Software, Inc. (Incorporated herein by
reference to Exhibit 10.26 to the Annual Report on Form 10-K for the
fiscal year ended December 31, 1992.)
10.27 Agreement, dated March 5, 1992, between Pollution Research and
Control Corp. and Lee Sion. (Incorporated herein by reference to
Exhibit 10.27 to the Annual Report on Form 10-K for the fiscal year
ended December 31, 1992.)
10.28 Option Agreement, dated June 22, 1992, between Pollution Research
and Control Corp. and Total Software, Inc. (Incorporated herein by
reference to Exhibit 10.28 to the Annual Report on Form 10-K for the
fiscal year ended December 31, 1992.)
10.29 Option Agreement, dated June 22, 1992, between Pollution Research
and Control Corp. and Total Software, Inc. (Incorporated herein by
reference to Exhibit 10.29 to theAnnuall Report on Form 10-K for the
fiscal year ended December 31, 1992.)
10.30 Lease Agreement, dated June 1, 1992, between Dasibi Environmental
Group. and Bernard C. Mills, Jr. (Incorporated herein by reference to
Exhibit 10.30 to the Annual Report on form 10-KSB for the fiscal year
ended December 31, 1994.)
10.31 Lease Agreement, dated January 6, 1994, between Pollution Research
and Control Corp. and the Prudential Insurance Company of
America. (Incorporated herein by reference to Exhibit 10.31 to the
Annual Report on form 10-KSB for the fiscal year ended December 31,
1994.)
10.32 Agreement, and Bill of Sale, dated February 18, 1994, between
Pollution Research and Control Corp. and General Monitors, Inc.
(Incorporated herein by reference to Exhibit 10.32 to the Annual Report
on form 10-KSB for the fiscal year ended December 31, 1994.)
10.33 Stipulation of Settlement, dated February 1994, between Pollution
Research and Control Corp. and Diversified Research Partners Limited
Partnership. (Incorporated herein by reference to Exhibit 10.33 to the
Annual Report on form 10-KSB for the fiscal year ended December 31,
1994.)
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10.34 Requirements Contract dated March 10, 1994, between Pollution
Research and Control Corp. and Logan Research, Ltd. (Incorporated
herein by reference to Exhibit 10.34 to the Annual Report on form 10-
KSB for the fiscal year ended December 31, 1994.)
10.35 Lease Agreement dated April 15, 1994, between Dasibi Environmental
Corp. and Summit Park Associates. (Incorporated herein by reference
to Exhibit 10.35 to the Annual Report on form 10-KSB for the fiscal
year ended December 31, 1994.)
10.36 Amended Employment Agreement, effective August 31, 1993, between
Pollution Research and Control Corp. and Albert E. Gosselin, Jr.,
(Incorporated herein by reference to Exhibit 10.36 to the Annual Report
on form 10-KSB for the fiscal year ended December 31, 1994.)
10.37 Employment Agreement, dated July 20, 1994, between Pollution
Research and Control Corp. and Cynthia L. Gosselin (Incorporated
herein by reference to Exhibit 10.37 to the Annual Report on form 10-
KSB for the fiscal year ended December 31, 1994.)
10.38 Final Judgment of Permanent Injunction and Other Relief as to
Pollution Research and Control Corp. dated July 7, 1994 in Case
Number 1.94CV01425, the Securities and Exchange Commission v.
Pollution Research and Control Corp., Albert E. Gosselin and Cynthia
Gosselin. (Incorporated herein by reference to Exhibit 10.38 to the
Annual Report on form 10-KSB for the fiscal year ended December 31,
1994.)
10.39 Final Judgment of Permanent Injunction and Other Relief as to
Albert E. Gosselin dated July 13, 1994 in Case
Number 1.94CV01425, the Securities and Exchange Commission v.
Pollution Research and Control Corp., Albert E. Gosselin and Cynthia
Gosselin. (Incorporated herein by reference to Exhibit 10.39 to the
Annual Report on form 10-KSB for the fiscal year ended December 31,
1994.)
10.40 Consent of Albert E. Gosselin dated June 7, 1994, in Case Number
1.94CV0125, the Securities and Exchange Commission v. Pollution
Research and Control Corp., Albert E. Gosselin and Cynthia Gosselin.
(Incorporated herein by reference to Exhibit 10.40 to the Annual Report
on form 10-KSB for the fiscal year ended December 31, 1994.)
10.41 Final Judgment of Permanent Injunction and Other Relief as to Cynthia
Gosselin, dated July 13, 1994 in Case Number 1.94CV01425, the
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herein by reference to Exhibit 10.41 to the Annual Report on
form 10- KSB for the fiscal year ended December 31, 1994.)
10.42 Consent of Cynthia L.. Gosselin dated June 7, 1994, in Case Number
1.94CV0125, the Securities and Exchange Commission v. Pollution
Research and Control Corp., Albert E. Gosselin and Cynthia Gosselin.
(Incorporated herein by reference to Exhibit 10.41 to the Annual Report
on form 10-KSB for the fiscal year ended December 31, 1994.)
10.43 Warrant to Purchase 40,000 Shares of Common Stock of Pollution
Research and Control Corp., dated January 22, 1990, issued to Marty
Williams. ((Incorporated herein by reference to Exhibit 4.9 to the
Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.44 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp., of Marty Williams, dated effective June
6, 1994. ((Incorporated herein by reference to Exhibit 4.10 to the
Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.45 Warrant to Purchase 202,500 Shares of Common Stock of Pollution
Research and Control Corp., dated December 2, 1991, issued to CSC
Industries, Inc. and affiliated companies. (Incorporated herein by
reference to Exhibit 4.11 to the Registration Statement on form S-3
(Registration No., 33-60035) of Pollution Research and Control Corp.
dated June 7, 1995.)
10.46 Amendment Warrant to Purchase Common Stock of Pollution Research
and Control Corp., of CSC Industries, Inc. and affiliated companies
Pension Plans Trust, dated effective June 6, 1994. (Incorporated herein
by reference to Exhibit 4.12 to the Registration Statement on form S-3
(Registration No., 33-60035) of Pollution Research and Control Corp.
dated June 7, 1995.)
10.47 Warrant to Purchase 67,500 Shares of Common Stock of Pollution
Research and Control Corp., dated December 8, 1991, issued to
Richard M. Molinsky. (Incorporated herein by reference to Exhibit 4.13
to the Registration Statement on form S-3 (Registration No., 33-60035)
of Pollution Research and Control Corp. dated June 7, 1995.)
10.48 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp., of Richard M. Molinsky, dated effective
June 6, 1994. (Incorporated herein by reference to Exhibit 4.14 to the
Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
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10.49 Warrant to Purchase 135,000 Shares of Common Stock of Pollution
Research and Control Corp., dated December 11, 1991, issued to
Kingsley & Co. (formerly Global Environment Fund) (Incorporated
herein by reference to Exhibit 4.15 to the Registration Statement on
form S-3 (Registration No., 33-60035) of Pollution Research and
Control Corp. dated June 7, 1995.)
10.50 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of Kingsley & Co. (formerly Global
Environment Fund), dated effective June 6, 1994. (Incorporated herein
by reference to Exhibit 4.16 to the Registration Statement on form S-3
(Registration No., 33-60035) of Pollution Research and Control Corp.
dated June 7, 1995.)
10.51 Warrant to Purchase 67,500 Shares of Common Stock of Pollution
Research and Control Corp., dated December 13, 1991, issued to A.
Robert Tantleff. (Incorporated herein by reference to Exhibit 4.17 to
the Registration Statement on form S-3 (Registration No., 33-60035)
of Pollution Research and Control Corp. dated June 7, 1995.)
10.52 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of A. Robert Tantleff, dated effective June
6, 1994. (Incorporated herein by reference to Exhibit 4.18 to the
Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.53 Warrant to Purchase 101,250 Shares of Common Stock of Pollution
Research and Control Corp., dated December 16, 1991, issued to
Stanley Becker. (Incorporated herein by reference to Exhibit 4.19 to
the Registration Statement on form S-3 (Registration No., 33-60035)
of Pollution Research and Control Corp. dated June 7, 1995.)
10.54 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of Stanley Becker, dated effective June 6,
1994. (Incorporated herein by reference to Exhibit 4.20 to the
Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.55 Warrant to Purchase 27,000 Shares of Common Stock of Pollution
Research and Control Corp., dated December 16, 1991, issued to John
Kilmartin. (Incorporated herein by reference to Exhibit 4.21 to the
Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.56 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of John Kilmartin, dated effective June 6,
1994. (Incorporated herein by reference to Exhibit 4.22 to the
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Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.57 Warrant to Purchase 74,250 Shares of Common Stock of Pollution
Research and Control Corp., dated December 16, 1991, issued to Bruce
Lynch. (Incorporated herein by reference to Exhibit 4.23 to the
Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.58 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of Bruce Lynch, dated effective June 6,
1994. (Incorporated herein by reference to Exhibit 4.24 to the
Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.59 Warrant to Purchase 25,000 Shares of Common Stock of Pollution
Research and Control Corp. of Michael Young, dated May 24, 1991.
(Incorporated herein by reference to Exhibit 4.25 to the Registration
Statement on form S-3 (Registration No., 33-60035) of Pollution
Research and Control Corp. dated June 7, 1995.)
10.60 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of Michael Young, dated effective June 6,
1994. (Incorporated herein by reference to Exhibit 4.26 to the
Registration Statement on form S-3 (Registration No., 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.61 Warrant to Purchase 12,000 Shares of Common Stock of Pollution
Research and Control Corp., of Kennedy
Capital Management, dated November 26, 1991. (Incorporated herein
by reference to Exhibit 4.27 to the Registration Statement on form S-3
(Registration No., 33-60035) of Pollution Research and Control Corp.
dated June 7, 1995.)
10.62 Amendment to Warrant to Purchase Common Stock of Pollution Research
and Control Corp. of Kennedy Capital Management dated effective
June 6, 1994. (Incorporated herein by reference to Exhibit
4.28 to the Registration Statement on form S-3 (Registration No., 33-
60035) of Pollution Research and Control Corp. dated June 7, 1995.)
10.63 Pollution Research and Control Corp. Common Stock Purchase
Warrant for the purchase of 60,000 shares of the Equity Group Inc.
dated August 31, 1993. (Incorporated herein by reference to Exhibit
4.29 to the Registration Statement on Form S-3 (Registration No. 33-
60035) of Pollution Research and Control Corp. dated June 7, 1995.)
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10.64 Warrant to Purchase 7,500 Shares of Common Stock of Pollution
Research and Control Corp. of Stanley Becker dated November 8,
1993. (Incorporated herein by reference to Exhibit 4.30 to the
Registration Statement on Form S-3 (Registration No. 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.65 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of Stanley Becker, dated effective June 6,
1994. (Incorporated herein by reference to Exhibit 4.31 to the
Registration Statement on Form S-3 (Registration No. 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.66 Warrant to Purchase 5,500 Shares of Common Stock of Pollution
Research and Control Corp. of Bruce Lynch dated November 8, 1993.
(Incorporated herein by reference to Exhibit 4.32 to the Registration
Statement on Form S-3 (Registration No. 33-60035) of Pollution
Research and Control Corp. dated June 7, 1995.)
10.67 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of Bruce Lynch, dated effective June 6,
1994. (Incorporated herein by reference to Exhibit 4.33 to the
Registration Statement on Form S-3 (Registration No. 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.68 Warrant to Purchase 7,500 Shares of Common Stock of Pollution
Research and Control Corp. of Robert Tantleff dated November 8,
1993. (Incorporated herein by reference to Exhibit 4.34 to the
Registration Statement on Form S-3 (Registration No. 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.69 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of Robert Tantleff, dated effective June 6,
1994. (Incorporated herein by reference to Exhibit 4.35 to the
Registration Statement on Form S-3 (Registration No. 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.70 Warrant to Purchase 5,000 Shares of Common Stock of Pollution
Research and Control Corp. of Edward G. Lowell dated November 8,
1995. (Incorporated herein by reference to Exhibit 4.36 to the
Registration Statement on Form S-3 (Registration No. 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.71 Option to Purchase 25,000 Shares of Common Stock of Pollution
Research and Control Corp. of Randy Foy dated as of July 4, 1994.
(Incorporated herein by reference to Exhibit 4.37 to the Registration
Statement on Form S-3 (Registration No. 33-60035) of Pollution
Research and Control Corp. dated June 7, 1995.)
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10.72 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of Frost and Company P.S. dated effective
February 9, 1992. (Incorporated herein by reference to Exhibit 4.38 to
the Registration Statement on Form S-3 (Registration No. 33-60035)
of Pollution Research and Control Corp. dated June 7, 1995.)
10.73 Amendment to Warrant to Purchase Common Stock of Pollution
Research and Control Corp. of Kial, Ltd., dated effective January 9,
1992. (Incorporated herein by reference to Exhibit 4.39 to the
Registration Statement on Form S-3 (Registration No. 33-60035) of
Pollution Research and Control Corp. dated June 7, 1995.)
10.74 Option to Purchase 40,000 Shares of Common Stock of Pollution
Research and Control Corp. of Albert E. Gosselin, Jr., dated as of June
29, 1995 (Incorporated herein by reference to Exhibit 4.40 to the Post-
Effective Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.75 Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. of Cindy Gosselin dated as of June 29,
1995. (Incorporated herein by reference to Exhibit 4.41 to the Post-
Effective Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.76 Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. of Barbara L. Gosselin dated as of June 29,
1995. (Incorporated herein by reference to Exhibit 4.42 to the Post-
Effective Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.77 Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. of Gary L. Dudley dated as of June 29,
1995. (Incorporated herein by reference to Exhibit 4.43 to the Post-
Effective Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.78 Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. of Marcia Smith dated as of June 29, 1995.
(Incorporated herein by reference to Exhibit 4.44 to the Post-Effective
Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
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10.79 Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. of Craig E. Gosselin dated as of June 29,
1995. (Incorporated herein by reference to Exhibit 4.45 to the Post-
Effective Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.80 Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. of Keith Gosselin dated as of June 29,
1995. (Incorporated herein by reference to Exhibit 4.46 to the Post-
Effective Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.81 Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. of Mike Chu dated as of June 29, 1995.
(Incorporated herein by reference to Exhibit 4.47 to the Post-Effective
Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.82 Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. of Kimberly Chu dated as of June 29,
1995. (Incorporated herein by reference to Exhibit 4.48 to the Post-
Effective Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.83 Option to Purchase 5,000 Shares of Common Stock of Pollution
Research and Control Corp. of Tolly Smith dated as of June 29, 1995.
(Incorporated herein by reference to Exhibit 4.49 to the Post-Effective
Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.84 Option to Purchase 25,000 Shares of Common Stock of Pollution
Research and Control Corp. of Randy Foy dated as of June 29, 1995.
(Incorporated herein by reference to Exhibit 4.50 to the Post-Effective
Amendment No. 1 to the Registration Statement on Form S-3
(Registration No. 33-60035) of Pollution Research and Control Corp.,
dated January 17, 1996.)
10.85 Option to Purchase 200,000 Shares of Common Stock of Pollution
Research and Control Corp. of J. Paul Consulting Group dated effective
July 18, 1995. (Incorporated herein by reference to Exhibit 4.51 to the
Post-Effective Amendment No. 1 to the Registration Statement on
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Form S-3 (Registration No. 33-60035) of Pollution Research and
Control Corp., dated January 17, 1996.)
10.86* Agreement dated June 11, 1996, among Logan Medical Devices, Inc., party of
the first part, Ronald Bruce Logan-Sinclair and Howard George Vincent Cooke,
parties of the second part, and Pollution Research and Control Corp., party of
the third part.
10.87* Employment Agreement dated June 11, 1996, between Logan Medical Devices,
Inc. and Logan Research Ltd., on the one hand, and Ronald Bruce Logan-
Sinclair, on the other hand.
10.88* Guarantee dated effective June 11, 1996, by Logan Medical Devices, Inc. in
favor of Namulas Pension Trustees Limited.
10.89* Loan and Security Agreement dated June 28, 1996, between Logan Medical
Devices, Inc., on the one hand, and Ronald Bruce Logan-Sinclair and Howard
George Vincent Cooke, on the other hand.
10.90* Nine Per Cent Debenture due June 28, 2,006, in the face amount
of $285,714.29, bearing interest quarterly commencing June 30,
1998.
10.91 Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Phil Huss. Option Agreement, dated
as of April 1, 1996, between Pollution Research and Control Corp. and Phil
Huss. (Incorporated herein by reference to Exhibit 4.11 to the
Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution Research and Control Corp. dated October 15, 1996.)
10.92 Consulting Agreement dated as of May 30, 1996, between Pollution
Research and Control Corp. and Liviakis Financial Communications,
Inc. (Incorporated herein by reference to Exhibit 4.12 to the
Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution and Control Corp. dated October 15, 1996.)
10.93 Non-Qualified Stock Option Agreement dated as of May 30, 1996,
between Pollution Research and Control Corp. and Liviakis Financial
Communications, Inc. (Incorporated herein by reference to Exhibit 4.13
to the Registration Statement on From S-3 (Registration No. 33-14133)
of Pollution Research and Control Corp. dated October 15, 1996.)
10.94 Non-Qualified Stock Option Agreement dated as of May 30, 1996,
between Pollution Research and Control Corp. and Robert B. Prag.
(Incorporated herein by reference to Exhibit 4.14 to the Registration
Statement on Form S-3 (Registration No. 33-14133) of Pollution
Research and Control Corp. dated October 15, 1996).
10.95 Amendment to Non-Qualified Stock Option Agreement dated July 31,
1996, between Pollution Research and Control Corp. and Liviakis
Financial Communications, Inc. (Incorporated herein by reference to
Exhibit 4.15 to the Registration Statement on Form S-3 (Registration
No. 33-14133) of Pollution Research and Control Corp. dated October 15,
1996.)
10.96 Amendment to Non-Qualified Stock Option Agreement dated July 31,
1996, between Pollution Research and Control Corp. and Robert B.
Prag. (Incorporated herein by reference to Exhibit 4.16 to the
Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution Research and Control Corp. dated October 15, 1996.)
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10.97 Amendment to Consulting Agreement dated 5/30/96 between Pollution
Research and Control Corp. and Liviakis Financial Communications,
Inc., dated July 31, 1996. (Incorporated herein by reference to
Exhibit 4.17 to the Registration Statement on Form S-3 (Registration
No. 33-14133) of Pollution Research and Control Corp. dated October 15,
1996.)
10.98 Second Amendment to Consulting Agreement dated 5/30/96 between
Pollution Research and Control Corp. and Liviakis Financial
Communications, Inc. dated as of August 28, 1996. (Incorporated
herein by reference to Exhibit 4.18 to the Registration Statement
on Form S-3 (Registration No. 33-14133) of Pollution Research and
Control Corp. dated october 15, 1996.)
10.99* Option to Purchase 55,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Aubrey Hornsby; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Aubrey Hornsby.
10.100* Option to Purchase 40,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Ernestine Taylor; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Ernestine Taylor.
10.101* Option to Purchase 30,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Debbie Kendrick; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Debbie Kendrick.
10.102* Option to Purchase 25,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Roland Fink; Option Agreement,
dated as of May 31, 1996, between Pollution Research and Control
Corp. and Roland Fink.
10.103* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Charles Conner; Option
Agreement, dated as of May 31, 1996 between Pollution Research and
Control Corp. and Charles Conner.
10.104* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Patricia Cudd; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Patricia Cudd.
10.105* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Jeffrey Harkey; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Jeffrey Harkey.
10.106* Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to James Bowers; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and James Bowers.
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10.107* Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Michael Jones; Option
Agreement, dated as of May 31, 1996, between Pollution Research
Corp. and Michael Jones.
10.108* Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Charles McQuaig; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Charles McQuaig.
10.109* Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Daniel Patanjo; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Daniel Patanjo.
10.110* Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Karen Perry; Option Agreement,
dated as of May 31, 1996, between Pollution Research and Control
Corp. and Karen Perry.
10.111* Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Ricky Sonnier; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Ricky Sonnier.
10.112* Option to Purchase 10,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Victor Valerio; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Victor Valerio.
10.113* Option to Purchase 5,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Spencer Abrams; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Spencer Abrams.
10.114* Option to Purchase 5,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Dan Busby; Option Agreement,
dated as of May 31, 1996, between Pollution Research and Control
Corp. and Dan Busby.
10.115* Option to Purchase 5,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Frank Getautas; Option
Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Frank Getautas.
10.116* Option to Purchase 5,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Mitzi Narramore; Option
</TABLE>
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<TABLE>
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Agreement, dated as of May 31, 1996, between Pollution Research and
Control Corp. and Mitzi Narramore.
10.117* Option to Purchase 300,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Ron Logan-Sinclair; Option
Agreement, dated as of June 1, 1996, between Pollution Research and
Control Corp. and Ron Logan-Sinclair.
10.118* Option to Purchase 123,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Albert E. Gosselin; Option
Agreement, dated as of June 1, 1996, between Pollution Research and
Control Corp. and Albert E. Gosselin.
10.119 Option to Purchase 120,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Albert E. Gosselin; Option Agreement,
dated as of June 1, 1996, between Pollution Research and Control Corp.
and Albert E. Gosselin. (Incorporated herein by reference to Exhibit 4.19
to the Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution Research and Control Corp. dated October 15, 1996.)
10.120 Option to Purchase 40,000 Shares of Common Stock of Pollution Research
and Control Corp. issued to Gary L. Dudley; Option Agreement,
dated as of June 1, 1996, between Pollution Research and Control Corp.
and Gary L. Dudley. (Incorporated herein by reference to Exhibit 4.20
to the Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution Research and Control Corp. dated October 15, 1996.)
10.121* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Gary L. Dudley; Option
Agreement, dated as of June 1, 1996, between Pollution Research and
Control Corp. and Gary L. Dudley.
10.122 Option to Purchase 40,000 Shares of Common Stock of Pollution Research
and Control Corp. issued to Craig E. Gosselin; Option Agreement, dated
as of June 1, 1996, between Pollution Research and Control Corp.
and Craig E. Gosselin. (Incorporated herein by reference to Exhibit 4.21
to the Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution Research and Control Corp. dated October, 15, 1996.)
10.123* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Craig E. Gosselin; Option
Agreement, dated as of June 1, 1996, between Pollution Research and
Control Corp. and Craig E. Gosselin.
10.124 Option to Purchase 40,000 Shares of Common Stock of Pollution Research
and Control Corp. issued to Cynthia L. Gosselin; Option Agreement,
dated as of June 1, 1996, between Pollution Research and Control Corp.
and Cynthia L. Gosselin. (Incorporated herein by reference to Exhibit 4.22
to the Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution Research and Control Corp. dated October 15, 1996.)
10.125* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Cynthia L. Gosselin; Option
Agreement, dated as of June 1, 1996, between Pollution Research and
Control Corp. and Cynthia L. Gosselin.
</TABLE>
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10.126 Options to Purchase 40,000 Shares of Common Stock of Pollution Research
and Control Corp. issued to Marcia Smith; Option Agreement, dated
as of June 1, 1996, between Pollution Research and Control Corp. and Marcia
Smith. (Incorporated herein by reference to Exhibit 4.23 to the
Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution Research and Control Corp. dated October 15, 1996.)
10.127* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Marcia Smith; Option
Agreement, dated as of June 1, 1996, between Pollution Research and
Control Corp. and Marcia Smith.
10.128 Option to Purchase 40,000 Shares of Common Stock of Pollution Research
and Control Corp. issued to Margaret Jones; Option Agreement, dated
as of June 1, 1996, between Pollution Research and Control Corp. and Margaret
Jones. (Incorporated herein by reference to Exhibit 4.24 to the
Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution Research and Control Corp. dated October 15, 1996.)
10.129* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Margaret Jones; Option
Agreement, dated as of June 1, 1996, between Pollution Research and
Control Corp. and Margaret Jones.
10.130* Option to Purchase 37,500 Shares of Common Stock of Pollution
Research Corp. issued to Lee Sion; Option Agreement, dated as of
June 1, 1996, between Pollution Research and Control Corp. and Lee
Sion.
10.131* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Patricia Cudd; Option
Agreement, dated as of June 1, 1996, between Pollution Research and
Control Corp. and Patricia Cudd.
10.132* Option to Purchase 20,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Roland Fink; Option Agreement,
dated as of June 1, 1996, between Pollution Research and Control Corp.
and Roland Fink.
10.133 Purchase Agreement, dated as of June 14, 1996, between Pollution
Research and Control Corp. and John Ann Hotchkiss; Warrant to
Purchase 291,667 Shares of Common Stock of Pollution Research and
Control Corp. dated June 15, 1996, issued to John Ann Hotchkiss.
(Incorporate herein by reference to Exhibits 4.25 and 4.26 to the
Registration Statement on Form S-3 (Registration No. 33-14133) of
Pollution Research and Control Corp. dated October 15, 1996.)
10.134 Purchase Agreement, dated as of June 14, 1996, between Pollution
Research and Control Corp. and David Firestone; Warrant to Purchase
166,667 Shares of Common Stock of Pollution Research and Control Corp.
dated June 15, 1996, issued to David Firestone. (Incorporated herein
by reference to Exhibits 4.27 and 4.28 to the Registration Statement on
Form S-3 (Registration No. 33-14133) of Pollution Research and Control
Corp. dated October 15, 1996.)
</TABLE>
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10.135 Purchase Agreement, dated as of June 14, 1996, between Pollution Research
and Control Corp. and Irawan Onggara; Warrant to Purchase 166,667 Shares
of Common Stock of Pollution Research and Control Corp., dated June 15,
1996, issued to Irawan Onggara. (Incorporated herein by reference to
Exhibits 4.29 and 4.30 to the Registration Statement on Form S-3
(Registration No. 33-14133) of Pollution Research and Control Corp. dated
October 15, 1996.)
10.136 Purchase Agreement, dated as of June 14, 1996, between Pollution Research
and Control Corp. and John M. Liviakis; Warranto to Purchase 66,667 Shares
of Common Stock of Pollution Research and Control Corp. dated June 15,
1996, issued to John M. Liviakis. (Incorporated herein by reference to
Exhibits 4.31 and 4.32 to the Registration Statement on Form S-3 (Registration
No. 33-14133) of Pollution Research and Control Corp. dated October 15, 1996.)
10.137 Purchase Agreement, dated as of June 14, 1996, between Pollution Research
and Control Corp. and Robert S. London; Warrant to Purchase 66,667 Shares
of Common Stock of Pollution Research and Control Corp., dated June 15,
1996, issued to Robert S. London. (Incorporated herein by reference to
Exhibits 4.33 and 4.34 to the Registration Statement on Form S-3 (Registration
No. 33-14133) of Pollution Research and Control Corp. dated October 15, 1996.)
10.138 Purchase Agreement, dated as of June 14, 1996, between Pollution Research
and Control Corp. and Robert B. Prag; Warranto to Purchase 66,667 Shares of
Common Stock of Pollution Research and Control Corp., dated June 15, 1996,
issued to Robert B. Prag. (Incorporated herein by reference to Exhibits
4.35 and 4.36 to the Registration Statement on Form S-3 (Registration No.
33-14133) of Pollution Research and Control Corp. dated October 15, 1996.)
10.139 Purchase Agreement, dated as of June 14, 1996, between Pollution Research
and Control Corp. and Shawn Cady; Warrant to Purchase 41,667 Shares of
Common Stock of Pollution Research and Control Corp., dated June 15, 1996,
issued to Shawn Cady. (Incorporated herein by reference to Exhibits 4.37 and
4.38 to the Registration Statement on Form S-3 (Registration No. 33-14133)
of Pollution Research and Control Corp. dated October 15, 1996.)
10.140 Purchase Agreement, dated as of June 14, 1996, between Pollution Research
and Control Corp. and Donald Carstens; Warrant to Purchase 41,667 Shares
of Common Stock of Pollution Research and Control Corp., dated June 15,
1996 issued to Donald Carstens. (Incorporated herein by reference to
Exhibits 4.39 and 4.40 to the Registration Statement on Form S-3
(Registration No. 33-14133) of Pollution Research and Control Corp. dated
October 15, 1996.)
10.141 Purchase Agreement, dated as of June 14, 1996, between Pollution Research
and Control Corp. and Ling Nen Chuan; Warrant to Purchase 41,667 Shares
of Common Stock of Pollution Research and Control Corp., dated June 15,
1996, issued to Ling Nen Chuan. (Incorporated herein by reference to
Exhibits 4.41 and 4.42 to Registration Statement on Form S-3 (Registration
No. 33-14133) of Pollution Research and Control Corp. dated October 15, 1996.)
10.142 Purchase Agreement, dated as of June 14, 1996, between Pollution Research
and Control Corp. and Sanibel Capital Corporation; Warrant to Purchase
41,667 Shares of Common Stock of Pollution Research and Control Corp.
dated June 15, 1996, issued to Sanibel Capital Corporation. (Incorporated
herein by reference to Exhibits 4.43 and 4.44 to the Registration Statement
(Registration No. 33-14133) of Pollution Research and Control Corp. dated
October 15, 1996.)
10.143 Purchase Agreement, dated as of June 14, 1996, between Pollution Research
and Control Corp. and Donna Sizemore; Warrant to Purchase 8,333 Shares of
Common Stock of Pollution Research and Control Corp., dated June 15, 1996,
issued to Donna Sizemore. (Incorporated herein by reference to Exhibits
4.45 and 4.46 to the Registration Statement to Form S-3 (Registration No.
33-14133) of Pollution Research and Control Corp. dated October 15, 1996.)
</TABLE>
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10.144 Option to Purchase 25,000 Shares of Common Stock of Pollution Research and
Control Corp. issued to Randy Foy; Option Agreement, dated as of July 1,
1996, between Pollution Research and Control Corp. and Randy Foy.
(Incorporated herein by reference to Exhibit 4.47 to the Registration
Statement on Form S-3 (Registration No. 33-14133) of Pollution Research
and Control Corp. dated October 15, 1996.)
10.145* Option to Purchase 40,000 Shares of Common Stock of Pollution
Research and Control Corp. issued to Paul Richardson; Option
Agreement, dated as of August 6, 1996, between Pollution Research
and Control Corp. and Paul Richardson.
10.146 Letter Agreement, dated as of September 20, 1996, between Pollution
Research and Control Corp. and Neil C. Sullivan; Warrant to Purchase 300,000
Shares of Common Stock of Pollution Research and Control Corp. dated
September 20, 1996, issued to Neil C. Sullivan. (Incorporated herein by
reference to Exhibits 4.48 and 4.49 to the Registration Statement on Form S-3
(Registration No. 33-14133) of Pollution Research and Control Corp. dated
October 15, 1996.)
10.147* Consulting Agreement dated November 19, 1996, between Pollution
Research and Control Corp. and Fenway Advisory Group.
10.148* Option to Purchase 400,000 Shares of Pollution Research and Control
Corp. issued to Fenway Advisory Group; Option Agreement dated as
of November 19, 1996, between Pollution Research and Control Corp.
and Fenway Advisory Group.
21* List of Subsidiaries.
</TABLE>
*Filed herewith.
E-19
<PAGE> 1
EXHIBIT 10.86
AGREEMENT
THIS AGREEMENT (the "Agreement") is made and entered into this 11th day
of June, 1996, by and among Logan Medical Devices, Inc., a Colorado corporation
(the "Company"), 506 Paula Avenue, Glendale, California 91201, party of the
first part, Ronald Bruce Logan-Sinclair ("RLS"), 2 Clarendon Drive, Rochester,
Kent, ME2 3LT, and Howard George Vincent Cooke ("HVC"), Sleepers, Buckland Lane,
Maidstone, Kent, ME16 0BH (individually, a "Seller" and, collectively, the
"Sellers"), owners of record and beneficially of all of the 6,300 issued and
outstanding 1 pound ordinary shares (the "Common Shares"), of Logan Research
Ltd., a private United Kingdom company limited by shares ("LRL"), 74 College
Road, Maidstone, Kent, ME15 6SL, parties of the second part, and Pollution
Research and Control Corp ("PRCC"), 506 Paula Avenue, Glendale, California
91201, party of the third part.
RECITALS:
A. WHEREAS, the Sellers desire to sell, assign, transfer, convey and
deliver to the Company, and the Company desires to purchase, acquire and receive
from the Sellers, the Common Shares, in consideration for the issuance and
exchange therefor of instruments each of which shall qualify as a note with a
security interest in all of the assets of the Company under the laws of the
State of California, United States, and as a "debenture" under the laws of the
United Kingdom (the "Debenture") in the aggregate principal amount of $300,000
(US), bearing interest at the rate of 9% per annum and payable pursuant to the
provisions thereof described herein, on the terms and subject to the conditions
set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants, agreements, representations and warranties contained herein,
the parties hereto agree as follows:
1. This Agreement is supplemental to an agreement entered into between
PRCC and the Sellers on May 30, 1996.
2. At or prior to the date hereof, the Sellers have delivered to the
Company the certificates and transfers for the Common Shares, the receipt of
which is hereby acknowledged by the Company. The Common Shares shall be held to
order by Patricia Cudd, a Colorado-licensed attorney, until the Closing (as
defined below) and returned to the Sellers in the event of the failure of the
Closing to occur.
<PAGE> 2
3. As payment in full of the purchase price for the Common Shares, at
the Closing, which shall be not later than June 25, 1996 (the "Closing"), the
Company shall issue to each of RLS and HVC Debentures in the principal amount of
$285,714.29 and $14,285,71, respectively. The Debentures shall be in the form
mutually acceptable to the Company and the Sellers and their respective legal
counsel which shall provide for the following basic terms and conditions: (i) a
term of ten years; (ii) callable by the Sellers after two years; (iii) interest
accruing at the rate of 9% per annum, but payable commencing in two years and
payable thereafter quarterly in arrears commencing on June 30, 1998; and (iv)
not callable by the Company prior to the expiration of six months. For purposes
of this paragraph all time periods are calculated from Closing.
4. PRCC shall, prior to the Closing, acquire all of the issued and
outstanding shares of common stock of the Company.
5. The Company, simultaneously with or as soon as practicable after the
Closing, shall deliver an employment agreement to RLS, which shall be in the
form mutually acceptable to the Company and RLS and their legal counsel which
shall provide for the following basic terms and conditions: (i) a term of three
years; (ii) a salary in the amount of 45,000 pounds sterling per annum payable
to RLS monthly.
6. In connection with the employment of RLS, PRCC shall grant to RLS an
option exercisable for a term of four years from May 31, 1996, at an exercise
price of $.99 per share, to purchase 270,000 common shares of PRCC.
7. PRCC shall forgive, at or prior to the Closing, the $164,000 balance
of the indebtedness owed by the Company to PRCC.
8. At or prior to the Closing, PRCC shall deposit the sum of $250,000
in cash in the Company's bank account representing a non-repayable contribution
to the capital of the Company.
9. The Company shall guarantee the obligations of LRL under the terms
of an Underlease dated March 24, 1995, and made between Namulas Pension Trustees
Limited (1) and LRL (2) in relation to Units B2 and B3, Anthony's Way,
Frindsbury, Rochester, Kent, United Kingdom. This obligation shall not extend to
any continuation, renewal or extension beyond the contractual term date thereof
(the contractual termination date)
10. HVC shall be retained by the Company as a consultant, on terms to
be mutually agreed, and PRCC shall appoint HVC to be a director of the Company.
Additionally, PRCC shall grant to HVC an option exercisable for a term of four
years from May 31, 1996, at an exercise price of $.86 per share, to purchase
30,000 common shares of PRCC.
11. Each of the parties hereto shall execute and deliver such other and
further documents and instruments, and take such other and further actions, as
may be reasonably requested of them for the implementation and consummation of
this Agreement and the transactions herein contemplated.
12. This Agreement shall be binding upon and inure to the benefit of
the parties hereto, and the heirs, personal representatives, successors and
assigns of all of them, but shall not confer, expressly or by implication, any
rights or remedies upon any other party.
<PAGE> 3
13. This Agreement is made and shall be governed in all respects,
including validity, interpretation and effect, by the laws of the United
Kingdom.
14. All notices, requests or demands and other communications hereunder
must be in writing and shall be deemed to have been duly made if personally
delivered or mailed, postage prepaid, to the parties as follows:
(a) If to the Company, to:
Mr. Albert E. Gosslein, Jr., President
Logan Medical Devices, Inc.
506 Paula Avenue
Glendale, California 91201
(b) If to the Sellers, to:
Mr. Ronald Bruce Logan-Sinclair
2 Clarendon Drive,
Rochester,
Kent
ME2 3LT
Mr. Howard George Vincent Cooke
Sleepers,
Buckland Lane,
Maidstone,
Kent
ME16 OBH
(c) If to PRCC, to:
Mr. Albert E. Gosslein, Jr., President
Pollution Research and Control Corp.
506 Paula Avenue
Glendale, California 91201
Any party hereto may change its address by written notice to the other party.
15. This Agreement contains the entire agreement between the parties
and supersedes all prior agreements, understandings and writings between the
parties with respect to the subject matter hereof and thereof. Each party hereto
acknowledges that no representations, inducements, promises or agreements, oral
or otherwise, have been made by any party, or anyone acting with authority on
behalf of any party, which are not embodied herein or in an exhibit hereto, and
that no other agreement, statement or promise may be relied upon or shall be
valid or binding. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated orally. This
<PAGE> 4
Agreement may be amended or any term hereof may be changed, waived, discharged
or terminated by an agreement in writing signed by all parties hereto.
16. Prior to the Closing, neither the execution of this Agreement nor
the performance of any provision contained herein shall cause any party hereto
to be or become liable in any respect for the operations of the business of any
other party, or the condition of property owned by any other party, for
compliance with any applicable laws, requirements, or regulations, of, or taxes,
assessments or other charges now or hereafter due to any governmental authority,
or for any other charges or expenses whatsoever pertaining to the conduct of the
business or the ownership, title, possession, use, or occupancy of any other
party.
17. In the event of any litigation between the parties hereto, the
non-prevailing party shall pay the reasonable expenses, including the attorneys'
fees, of the prevailing party in connection therewith.
18. This Agreement may be executed in counterparts, each of which shall
be deemed an original but all of which taken together shall constitute but one
and the same document.
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the day and year first above written.
/s/ Ronald Bruce Logan-Sinclair LOGAN MEDICAL DEVICES, INC.
Ronald Bruce Logan-Sinclair
By: /s/ Albert E. Gosselin, Jr.
----------------------------------------
Albert E. Gosselin, Jr., President
- -----------------------------------
/s/ Howard George Vincent Cooke
- -----------------------------------
Howard George Vincent Cooke
POLLUTION RESEARCH AND CONTROL CORP.
By: /s/ Albert E. Gosselin, Jr.
-------------------------------
Albert E. Gosselin, Jr., President
<PAGE> 1
EXHIBIT 10.87
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (hereinafter referred to as the "Agreement")
dated effective this 11th day of June, 1996, by and among LOGAN MEDICAL DEVICES,
INC. (hereinafter referred to as the "Company"), a Colorado corporation with its
principal executive offices located at 506 Paula Avenue, Glendale, California
91201, and LOGAN RESEARCH LTD. ("hereinafter referred to as "LRL"), a private
United Kingdom company limited by shares with its "registered" office located at
74 College Road, Maidstone, Kent, ME15 6SL, United Kingdom, on the one hand, and
RONALD BRUCE LOGAN-SINCLAIR (hereinafter referred to as the "Employee"), whose
residence address is 2 Clarendon Drive, Rochester, Kent, ME2 3LT, United
Kingdom, on the other hand. The Company and LRL are hereinafter referred to
collectively as the "Employer."
WITNESSETH:
WHEREAS:
1. The Employer is engaged in the business of designing, developing,
manufacturing, marketing and/or distributing a variety of medical devices,
including, initially, a medical device which monitors patient production of
nitric oxide in real-time, used in the diagnosis and treatment of the
respiratory condition known as "asthma" and other airway inflammatory diseases.
2. The Employee has certain expertise in the above-described business.
3. The Employer desires to employ the Employee and the Employee desires
to be employed by the Employer upon the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the mutual promises and agreements
hereinafter set forth, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Employment.
The Employer hereby employs, engages and hires the Employee as the Chief
Executive Officer of the Employer and the Employee hereby accepts and agrees to
such employment, hiring and engagement and to the orders, advice and direction
of the Employer. The Employee, in his capacity as the Chief Executive Officer of
the Employer, shall manage and direct the overall programs and activities of the
Employer in the day-to-day operations of the business of the Employer. In
addition, the Employee shall have and perform such other duties as are
customarily performed by one holding such position in other businesses or
enterprises that are the same as or similar to that engaged in by the Employer,
and shall have and perform such unrelated duties and services as may be
assigned to him from time to time by the Board of Directors of the Employer. The
Employee agrees to abide by the Company policies and procedures established from
time to time by the Employer. The exact nature of the duties of the Employee
shall be more fully outlined and defined in a formal job description between the
<PAGE> 2
Employer and the Employee, copies of which, as amended from time to time, shall
be attached hereto and incorporated herein by this reference.
2. Best Efforts of Employee.
The Employee agrees that he will at all times faithfully, industriously and to
the best of his ability, experience and talents perform to the reasonable
satisfaction of the Employer all of the duties that may be required of and from
him pursuant to the express and implicit terms of this Agreement. Such duties
shall be rendered at Unit B2 Spectrum Business Centre, Anthony's Way, Rochester,
Kent, ME24NP, United Kingdom, and at such place or places and during such hours
as the Employer shall in good faith require or as the interest, needs, business
or opportunity of the Employer shall require.
3. Term of Employment.
The term of this Agreement shall be a period of three (3) years, commencing June
11, 1996, and terminating June 11, 1999, subject, however, to prior termination
as hereinafter provided. At the expiration date, this Agreement shall be
considered renewed for regular periods of one (1) year, i.e., on a rolling
twelve-month basis under the laws of Great Britain, provided neither party
submits a notice of termination on or prior to any subsequent expiration date.
4. Compensation of Employee.
LRL shall pay or furnish the Employee, and the Employee shall accept from LRL,
as full compensation for the Employee's services, including, without limitation,
any services rendered by him as an officer or director of the Employer or of any
parent, subsidiary or affiliate of the Employer, a gross salary based on the
rate of 45,000 pounds sterling per annum, payable in installments of 3,750
pounds sterling once per month on the normal and customary paydays of LRL during
the term of this Agreement.
5. Termination.
a. This Agreement may be terminated by the Employee upon sixty
(60) days' prior written notice to the Employer. If the Employee shall
so terminate this Agreement, the Employee shall be entitled to pay only
to the date of such termination.
b. (1) The Employer, by a majority vote of the Board of
Directors, may terminate this Agreement at any time in the event of any
violation by the Employee of any of the terms of this Agreement or for
cause, as defined below, without notice to the Employee and with pay
only to the date of such termination.
(2) Sufficient cause for termination by the Employer shall
be a determination made in good faith and based upon reasonable grounds that the
Employee: (a) has failed to adequately perform his duties hereunder, as
determined by the Board of Directors in its sole discretion, or has been
substantially absent from employment; (b) has engaged in habitual drunkenness or
abusive drugs rendering the Employee unable to carry out his duties in a
responsible manner; (c) has embezzled funds or misapplied assets of the
Employer; (d) has
<PAGE> 3
committed an act with the intent to defraud or hinder the Employer; or (e) has
been negligent in the performance of the duties owed by the Employee to the
Employer.
(3) As soon as may be practicable after the termination of
the Employee by the Employer for cause, the Board of Directors of the Employer
shall make an investigation of, and allow the Employee an opportunity to discuss
with the Board of Directors, the relevant facts with respect thereto. If the
Board of Directors of the Employer shall determine that the Employee has been
terminated without cause, the Employee shall be reinstated in the position which
he held prior to the termination and shall receive any compensation accrued or
payable during the period of his termination. In such event, any accrued
benefits shall be payable to the Employee as if the Employee had not been
terminated.
(4) Any conduct of the Employee which shall constitute
cause for termination under the terms of subparagraph b.(2) of this Paragraph 6.
and any breach or evasion of any of the terms of this Agreement by either party
hereto will result in immediate and irreparable injury to the injured party and
will authorize recourse to injunction and/or specific performance as well as to
all other legal or equitable remedies to which such injured party may be
entitled hereunder.
c. Anything herein contained to the contrary notwithstanding,
in the event that the Employer shall discontinue operating its business for any
reason including but not limited to insolvency, then this Agreement and the
Employee's employment hereunder shall terminate as of the date the Employer
ceases business operation. For purposes of this Agreement, the Employer shall be
considered to be insolvent if: (i) a petition under Chapters 7, 11 or 12 of the
Bankruptcy Reform Act of 1978 has been filed by or against the Employer and has
not been dismissed within ninety (90) days after filing; or (ii) the Employer
has made an assignment for the benefit of creditors.
d. If the Employee shall die during the term of this
Agreement, this Agreement and the Employee's employment hereunder shall
terminate immediately upon the Employee's death, provided that the Employee
shall be entitled to his salary hereunder to the last day of the sixth month
following the month in which such death occurs.
e. (i) Notwithstanding anything in this Agreement to the
contrary, the Employer is hereby given the option to terminate this
Agreement and the Employee's employment hereunder in the event that the
Employee, during the term hereof, shall become permanently disabled as
defined in subparagraph e.(ii) of this Paragraph 6. below. Such option
may be exercised by the Employer at any time after the Employee becomes
permanently disabled by giving written notice of termination to the
Employee. This Agreement and the Employee's employment shall terminate
one hundred eighty (180) days after such notice, provided that the
Employee shall be entitled to his salary hereunder to the last day of
the month in which such termination occurs.
(ii) For purposes of this Agreement, the Employee
shall be deemed to have become permanently disabled if, because of ill
health, physical or mental disability or for other causes beyond his
control, he shall have been unable or unwilling or shall have failed to
perform his duties hereunder on ninety per cent (90%) of the days
during a period of two (2) consecutive months, irrespective of whether
or not such days are consecutive.
<PAGE> 4
7. Extent of Service; Self-Dealing.
The Employee shall devote his full, normal working time, attention and energy to
the business of the Employer and, as assigned by the Board of Directors of the
Employer, to the business of corporations affiliated with the Employer, and
shall not during the term of this Agreement be engaged in any other business
activity which conflicts with the Employee's obligations under this Agreement.
The foregoing shall not be construed as preventing the Employee from making
investments in businesses or enterprises provided such investments do not
require any services on the part of the Employee in the management, operation or
affairs of such businesses or enterprises.
The Employee shall cooperate with, assist and furnish information upon request
to the President or the Board of Directors of the Employer or of the directors
or affiliates of the Employer and the auditors and legal counsel for the
Employer or its affiliates. The provisions of this Paragraph shall survive
termination of this Agreement with respect to matters arising during the period
of employment of the Employee by the Employer.
8. Disclosures of Information.
The Employee recognizes and acknowledges that he has and will have access to
certain confidential information of the Employer and its affiliates, such as
data accumulation and analysis of computer hardware and software, lists of
clients or customers, know-how and other proprietary information, that are
valuable, special and unique assets and property of the Employer and such
affiliates. The Employee will not, during or after the term of his employment,
disclose, without the prior written consent or authorization of the Employer, or
authorize or permit anyone under his direction or control to disclose any of
such information to any firm, person, corporation, association, enterprise or
other entity, except to authorized representatives of the Employer or its
affiliates, for any reason or purpose whatsoever. In this regard, the Employee
agrees that such authorization or consent to disclosure may be conditioned upon
the disclosure being made pursuant to a secrecy agreement, protective order,
provision of statute, rule, regulation or other procedure under which the
confidentiality of the information is maintained in the hands of the person to
whom the information is to be disclosed. In the event a third party seeks to
compel disclosure of confidential information by the Employee by judicial or
administrative process, the Employee shall promptly notify the Employer of such
occurrence and furnish to the Employer a copy of the demand, summons, subpoena
or other process served upon the Employee to compel such disclosure, and will
permit the Employer to assume, at the Employer's expense but with the Employee's
cooperation, defense of the disclosure demand. In the event the Employer does
not contest such a third-party disclosure demand under judicial or
administrative process or a final judicial order is issued compelling disclosure
of confidential information by the Employee, the Employee shall be entitled to
disclose such confidential information in compliance with the terms of such
administrative or judicial process or order.
Upon termination of the Employee's employment by the Employer, the
Employee shall neither take or retain any proprietary papers, customer lists,
manuals, files or other documents or copies thereof belonging to the Employer or
any of its affiliates.
The provisions of this Paragraph shall survive the termination of this
Agreement. In the event of a breach or threatened breach by the Employee of the
provisions of this Paragraph, the Employer shall be entitled to an injunction
restraining the Employee from disclosing, in whole or in part, such
<PAGE> 5
confidential information. Nothing herein shall be construed as prohibiting the
Employer from pursuing any other remedies available to the Employer for such
breach or threatened breach, including the recovery of damages from the
Employee.
9. Vacation.
The Employee shall be entitled to a vacation of four (4) weeks per year, plus
customary local holidays, during the term of this Agreement. The Employee shall
be entitled to receive all compensation payable hereunder in full during the
period of any vacation.
10. Other Benefits.
The Employee shall be entitled to all other benefits contained in the approved
Company benefit plan(s) offered to all employees, subject to the provisions of
such plan(s). This plan includes holidays, sick leave and other benefits.
11. Security for LRL Loan/Overdraft Facility.
Pollution Research and Control Corp. (hereinafter referred to as "PRCC"), a
California corporation which owns all of the issued and outstanding shares of
common stock of the Company, and the Company agree to deposit with Midland Bank
PLC (hereinafter referred to as "Midland Bank"), on or prior to forty-five (45)
days from the date on which PRCC receives all information and documentation
reasonably deemed by PRCC management to be necessary or appropriate in order to
complete a current business plan for the Company and LRL to be used in the offer
and sale of certain of the Company's securities pursuant to U.S. and applicable
state securities laws, the sum of US $50,000, in the form of a deposit bearing
account or other short-term instrument, as security for that certain
loan/overdraft facility in the amount of 60,000 pounds sterling payable by LRL
to Midland Bank. Any and all safeguards, such as dual signatures, as may be
mutually agreed upon by PRCC, the Employer and the Employee, shall be placed
upon withdrawal of the funds so deposited. PRCC and the Company further agree to
use their best efforts to deposit with Midland Bank, on or prior to the
expiration of the aforementioned 45-day period, such additional funds such that,
when added to the US $50,000 sum, shall be equivalent to the total amount of the
aforementioned loan/overdraft facility.
12. Notices.
Any notice required or permitted to be given under this Agreement shall be
sufficient if in writing and delivered or sent by registered or certified mail
to his last known address, in the case of the Employee, or to the principal
executive offices of the Company, in the case of the Employer.
13. Waiver of Breach.
Any waiver by the Employer of a breach of any provision of this Agreement by the
Employee shall not operate or be construed as a waiver of any subsequent breach
by the Employee.
14. Assignment.
<PAGE> 6
The rights and obligations of the Employer under this Agreement shall inure to
the benefit of and shall be binding upon the successors and assigns of the
Employer.
15. Applicable Law.
It is the intention of the parties hereto that this Agreement and the
performance hereunder and all suits and special proceedings hereunder be
construed in accordance with and pursuant to the laws of the Sate of Colorado
and that in any action, special proceeding or other proceeding that may be
brought arising out of, in connection with or by reason of this Agreement, the
laws of the State of Colorado shall be applicable and shall govern to the
exclusion of the law of any other forum, without regard to the jurisdiction in
which any action or special proceeding may be instituted.
16. Severability.
All agreements and covenants contained herein are severable, and in the event
any of them, with the exception of those contained in Paragraphs 1 and 4 hereof,
shall be held to be invalid by any competent court, this Agreement shall be
interpreted as if such invalid agreements or covenants were not contained
herein.
17. Entire Agreement.
This Agreement constitutes and embodies the entire understanding and agreement
of the parties and supersedes and replaces all prior understandings, agreements
and negotiations between the parties, provided that nothing herein shall be
deemed to restrict or limit the common law duties of the Employee to the
Employer.
18. Waiver and Modification.
Any waiver, alteration or modification of any of the provisions of this
Agreement shall be valid only if made in writing and signed by the parties
hereto. Each party hereto, from time to time, may waive any of his or its rights
hereunder without effecting a waiver with respect to any subsequent occurrences
or transactions hereof.
19. Captions and Paragraph Headings.
Captions and paragraph headings used herein are for convenience only, are not a
part hereof and shall not be used in construing this Agreement.
<PAGE> 7
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to
be effective as of the day and year first above written.
EMPLOYEE:
/S/ Ronald Bruce Logan-Sinclair
------------------------------------------
Ronald Bruce Logan-Sinclair
EMPLOYER:
ATTEST: LOGAN MEDICAL DEVICES, INC.
By: /s/ Ronald Bruce Logan-Sinclair
- ---------------------------------- --------------------------------------
, Witness Ronald Bruce Logan-Sinclair, President
ATTEST: LOGAN RESEARCH, LTD.
/s/ Ronald Bruce Logan-Sinclair
- ---------------------------------- ------------------------------------------
Ronald Bruce Logan-Sinclair,
Managing Director
<PAGE> 1
EXHIBIT 10.88
GUARANTEE
THIS GUARANTEE (hereinafter referred to as the "Guarantee") is made and
entered into effective this 11th day of June, 1996, by Logan Medical Devices,
Inc. (hereinafter referred to as the "Company"), a Colorado corporation with its
principal executive offices located at 506 Paula Avenue, Glendale, California
91201, in favor and for the benefit of Namulas Pension Trustees Limited
("hereinafter referred to as "NPTL"), whose address is The Priory Hitchen, SG5
2DW , United Kingdom.
WHEREAS, Logan Research Limited (hereinafter referred to as "LRL"), a
private United Kingdom company limited by shares with its principal executive
offices located at 74 College Road, Maidstone, Kent, ME15 6SL, United Kingdom,
has entered into that certain Underlease (hereinafter referred to as the
"Underlease") dated March 24, 1995, with NPTL in relation to Units B2 and B3,
Anthony's Way, Frindsbury, Rochester, Kent, United Kingdom, a copy of which
Underlease is attached hereto and incorporated herein by this reference.
WHEREAS, the Company agreed, pursuant to that certain Agreement
(hereinafter referred to as the "Agreement") dated June 11, 1996, by and among
the Company, Pollution Research and Control Corp. and Ronald Bruce
Logan-Sinclair and Howard George Vincent Cooke, the former owners of record and
beneficially of all of the 6,300 issued and outstanding 1 pound ordinary shares
(hereinafter referred to as the "Common Shares") of LRL, to guarantee the
obligations of LRL under the terms of the Underlease in connection with the
acquisition by the Company of the Common Shares pursuant to the Agreement.
WHEREAS, the Company desires pursuant to the Agreement and this
Guarantee to guarantee the obligations, responsibilities and commitments of LRL
under the terms and conditions of the Underlease.
NOW, THEREFORE, the Company hereby enters into this Guarantee as
follows:
1. Guarantee. The Company hereby guarantees to NPTL that, in the event
that LRL is unable to perform any or all of its obligations, responsibilities
and commitments under the Underlease for any reason, then, and in that event,
the Company will perform any or all of the obligations, responsibilities and
commitments of LRL under the terms and conditions of the Underlease.
2. Term of Guarantee. The term of this Guarantee shall continue through
and including the contractual termination date of the Underlease, but shall not
extend to any continuation, renewal or extension beyond the contractual
termination date of the Underlease.
3. Notices. Any notices required or permitted to be given under this
Guarantee shall be sufficient if in writing and delivered or sent by registered
or certified mail to the address of the parties set forth hereinabove.
<PAGE> 2
4. Assignment. This Guarantee and the obligations of the Company
hereunder shall inure to the benefit of and shall be binding upon its successors
and assigns.
5. Applicable Law. It is the intention of the parties hereto that this
Guarantee and the performance hereunder and all suits and special proceedings
hereunder be construed in accordance with and under and pursuant to the laws of
the State of Colorado and that in any action, special proceeding or other
proceeding that may be brought arising out of, in connection with or by reason
of this Guarantee, the laws of the State of Colorado shall be applicable and
shall govern to the exclusion of the law of any other forum, without regard to
the jurisdiction in which any action or special proceeding may be instituted.
6. Attorneys' Fees. The Company agrees that, should litigation arise in
relation to this Guarantee or its enforcement, as between the Company and NPTL,
the Company agrees to pay NPTL the amount of NPTL's reasonable attorneys' fees,
expenses and costs if the Company is the losing party.
IN WITNESS WHEREOF, the Company has duly executed and delivered this
Guarantee effective as of the day and year first above written.
ATTEST: LOGAN MEDICAL DEVICES, INC.
By: By:/s/ Ronald Bruce Logan-Sinclair
------------------------------------ ------------------------------------
, Secretary Ronald Bruce Logan-Sinclair,
President
<PAGE> 1
EXHIBIT 10.89
LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT (hereinafter referred to as the
"Agreement") is made and entered into effective this 28th day of June, 1996, by
and between Logan Medical Devices, Inc., a Colorado corporation with its
principal executive offices located at 506 Paula Avenue, Glendale, California
91201 (hereinafter referred to as the "Company"), on the one hand, and Ronald
Bruce Logan-Sinclair, whose address is 2 Clarendon Drive, Rochester, Kent, ME2
3LT, United Kingdom, and Howard George Vincent Cooke, whose address is Sleepers,
Buckland Lane, Maidstone, Kent, ME16 0BH, United Kingdom, on the other hand.
Messrs. Logan-Sinclair and Cooke are hereinafter sometimes collectively referred
to as the "Debentureholders."
WHEREAS, the Company agreed, pursuant to that certain Agreement dated
June 11, 1996, by and among the parties hereto and Pollution Research and
Control Corp., to purchase 6,300 issued and outstanding 1 pound ordinary shares
(hereinafter referred to as the "Common Shares") of Logan Research Ltd., a
private United Kingdom company limited by shares with its offices located at 74
College Road, Maidstone, Kent, ME15 6SL, United Kingdom ("hereinafter referred
to as "LRL"), owned of record and beneficially collectively by the
Debentureholders, as payment in full of the purchase price for which the Company
agreed to issue debentures (hereinafter referred to as the "Debentures") in the
principal amounts of $285,714.29 and $14,285.71 to Messrs. Logan-Sinclair and
Cooke, respectively.
WHEREAS, the Debentureholders have delivered the certificates and
transfers for the Common Shares to the Company prior to the date hereof.
WHEREAS, the Company has duly authorized the issuance of the Debentures
to each of the Debentureholders under this Agreement in the principal amounts
indicated above as payment in full of the purchase price for the Common Shares
and, further, the Company has duly authorized the execution and delivery of this
Agreement to provide therefor and for the respective rights of the Company and
the Debentureholders hereunder and the terms upon which the Debentures are, and
are to be, delivered.
NOW, THEREFORE, in consideration of the mutual promises and agreements
hereinafter set forth, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.1. Definitions. When used herein, the following terms shall
have the following meanings:
<PAGE> 2
a. "Account(s)": Account(s), contract right(s), chattel
paper, instruments and documents, whether now owned or hereinafter acquired by
the Company.
b. "Agreement": The Loan and Security Agreement described
in the first paragraph of this instrument.
c. "Account Debtor": Any "Person" (as defined in subsection
u. below) who is or who may become obligated to the Company under or on account
of an Account.
d. "Business Day": The term "business day" shall mean each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a legal holiday in
Glendale, California, or is not a day on which banking institutions in the State
of California are closed or are authorized by law to be closed.
e. "Charges": All national, federal, state, county, city,
municipal and/or other governmental taxes, levies, assessments, charges, liens,
claims or encumbrances upon and/or relating to
(a) The "Collateral" (as defined in subsection f.
below);
(b) The "Liabilities" (as defined in subsection s.
below);
(c) The Company's employees, payroll, income and/or
gross receipts;
(d) The Company's ownership and/or use of its assets;
or
(e) Any other aspect of the Company's business.
f. "Collateral": The property and interests in property
securing the Liabilities pursuant to Article IV hereof.
g. "Company": The Person named as the "Company" in the first
paragraph of this document until a successor corporation shall have become such
pursuant to the applicable provisions of this Agreement, and thereafter
"Company" shall mean such successor corporation.
h. "Company Request," "Company Order" and "Company Consent"
mean, respectively, a written request, order or consent signed in the name of
the Company by its Chairman of the Board of Directors, President or a Vice
President and by its Treasurer, an Assistant Treasurer, Secretary or an
Assistant Secretary.
i. "Debenture Register": This term has the meaning specified
in Section 2.3. hereof.
j. "Debentureholder": The Person in whose name such Debenture
is registered in the Debenture Register.
<PAGE> 3
k. "Debentures": Those certain instruments of even date
herewith from the Company to each of Messrs. Logan-Sinclair and Cooke in the
principal amounts of $285,714.29 and $14,285.71, respectively, in the forms of
Exhibits A and B attached hereto and incorporated herein by this reference.
l. "Equipment": All of the Company's now owned or hereinafter
acquired fixtures and equipment, including, without limitation, furniture,
vehicles and trade fixtures.
m. "Event of Default": Any of the events specified in Section
6.1. hereof.
n. "General Intangibles": All choses in action, causes of
action and all other intangible personal property of the Company of every kind
and nature (other than Accounts) now owned or hereinafter acquired by the
Company, including, without limitation, corporate or other business records,
inventions, designs, patents, patent applications, trademarks, trade names,
trade secrets, goodwill, copyrights, registrations, licenses, franchises,
customer lists, tax refund claims, computer programs and the claims under
guaranties, security interests or other security held by or granted to the
Company to secure payment of any of the Accounts by an Account Debtor.
o. "Holder": The Person or Persons in whose name or names a
particular Debenture shall be registered on the Debenture Register.
p. "Indebtedness": All liabilities, obligations and
indebtedness of any and every kind and nature, including, without limitation,
the Liabilities and all obligations to trade creditors, whether heretofore, now
or hereinafter owing, arising, due or payable from the Company to any Person and
howsoever evidenced, created, incurred, acquired or owing, whether primary,
secondary, direct, contingent, fixed or otherwise. Without in any way limiting
the generality of the foregoing, Indebtedness specifically includes the
following:
(i) All obligations or liabilities of the Company
which are secured by any lien, claim, encumbrance or security interest upon
property owned by the Company, even though the Company has not assumed or become
liable for the payment thereof.
(ii) All obligations or liabilities created or
arising under any lease of real or personal property, or conditional sale or
other title retention agreement with respect to property used and/or acquired by
the Company, even though the rights and remedies of the lessor, seller and/or
lender thereunder are limited to repossession of such property; and
(iii) Deferred taxes.
q. "Interest Payment Date": The Stated Maturity (March 31,
June 30, September 30 or December 31, as the case may be) of an installment of
interest on the Debentures.
r. "Inventory": Any and all goods, merchandise and other
personal property, wheresoever located and whether or not in transit, now owned
or hereinafter acquired by the Company which is or may at any time be held for
sale or lease, furnished under any contract of service or held as raw materials,
work in process, supplies or materials used or consumed in the Company's
business, including, without limitation, medical and related products, devices
and components and supplies used
<PAGE> 4
or useful in the manufacturing process, and all such property the sale or other
disposition of which has given rise to Accounts and which has been returned to
or repossessed or stopped in transit by the Company.
s. "Liabilities": All liabilities, obligations and
indebtedness of any and every kind and nature (including, without limitation,
interest, charges, expenses, attorneys' fees and other sums chargeable to the
Company by the Debentureholders), whether arising under the Debentures or this
Agreement, under any of the "Other Agreements" (as defined in subsection u.
below) or acquired by the Company from any other source, whether heretofore, now
or hereinafter owing, arising, due or payable from the Company to the
Debentureholders and howsoever evidenced, created, incurred, acquired or owing,
whether primary, secondary, direct, contingent, fixed or otherwise, including
obligations of performance.
t. "Maturity": The date on which the principal of such
Debenture becomes due and payable as therein or herein provided, whether at the
Stated Maturity or by declaration of acceleration, call for redemption or
otherwise.
u. "Other Agreements": All "Supplemental Documentation" (as
defined in subsection ee. below) and all agreements, instruments and documents,
including, without limitation, notes, guaranties, mortgages, deeds of trust,
chattel mortgages, pledges, powers of attorney, consents, assignments,
contracts, notices, security agreements, leases, financing statements,
subordination agreements, trust account agreements and all other written matters
whether heretofore, now or hereinafter executed by or on behalf of the Company
and/or delivered to the Debentureholders, with respect to this Agreement, or
with respect to the Debentureholders.
v. "Person": Any individual, sole proprietorship,
partnership, joint venture, trust, unincorporated organization, association,
corporation, institution, entity, party or government (whether national,
federal, state, county, city, municipal or otherwise, including, without
limitation, any instrumentality, division, agency, body or department thereof.)
w. "Place of Payment": Means the office of the Company
maintained for purpose of payment in the City of Glendale, County of Los
Angeles, State of California.
x. "Presentment Date": When used with respect to any
Debenture to be redeemed means the date when any notice of such redemption is
received by the Company.
y. "Record Date": When used with respect to an interest
payment date means March 1, June 1, September 1 or December 1 next preceding
each such Interest Payment Date, or if such date is not a Business Day in the
State of California, the Business Day next preceding such date and, when used
with respect to the payment of any defaulted interest, means the date,
established by the Company by giving notice thereof to Debentureholders not less
than ten (10) days preceding such date, for the determination of
Debentureholders entitled to such payment.
z. "Redemption Date": When used with respect to any
Debenture to be redeemed means the date fixed for such redemption by or pursuant
to this Agreement.
<PAGE> 5
aa. "Redemption Price": When used with respect to any
Debenture to be redeemed means the price at which it is to be redeemed pursuant
to this Agreement.
bb. "Stated Maturity": When used with respect to any
Debenture or any installment of interest thereon means the date specified in
such Debenture as the fixed date on which the principal of such Debenture or
such installment of interest is due and payable.
cc. "Stock": All shares, options, interests, participations
or other equivalents (howsoever designated) of or in a corporation, whether
voting or non-voting, including, without limitation, common stock, warrants,
preferred stock, convertible debentures and all agreements, instruments and
documents convertible, in whole or in part, into any one or more or all of the
foregoing.
dd. "Subsidiary": The term "Subsidiary" shall mean any
corporation the majority of the shares of Stock of which at the time outstanding
having voting power for the election of directors is owned directly or
indirectly by the Company or by one or more of its other Subsidiaries.
ee. "Supplemental Documentation": Agreements, instruments,
documents, financing statements, warehouse receipts, bills of lading, notices of
assignment of accounts, schedules of accounts assigned, mortgages, certificates
of title and other written matter necessary or requested by the Debentureholders
to perfect and maintain perfected the Debentureholders' security interests in
the Collateral and to consummate the transactions contemplated in or by this
Agreement and the Other Agreements.
ee. "Other Terms": All other terms contained in this
Agreement shall, when the context so indicates, have the meanings provided for
by the Uniform Commercial Code, as now in effect in the State of Colorado, to
the extent that the same are used or defined therein.
Section 1.2. Acts of Debentureholders.
a. Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given or taken
by the Debentureholders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Debentureholders in
person or by agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Company. Such instrument or instruments (and in
the action embodied therein and evidenced thereby) are herein sometimes referred
to as the "Act" of the Debentureholders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Agreement and conclusive in
favor of the Company, if made in the manner provided in this Section.
b. The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of any notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
<PAGE> 6
execution is by an officer of a corporation or a member of a partnership on
behalf of such corporation or partnership, such certificate or affidavit shall
also constitute sufficient proof of his authority.
c. The fact and date of execution of any such instrument or
writing or the authority of the Person executing the same may also be proved in
any other manner which the Company deems sufficient; and the Company may in any
instance require further proof with respect to any of the matters referred to in
this Section.
d. The ownership of Debentures shall be proved by the
Debenture Register.
e. Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Debenture shall bind every
future Holder of the same Debenture and the Holder of every Debenture issued
upon the transfer thereof or in exchange therefor or in lieu thereof, in respect
of anything done, omitted or suffered to be done by the Company in reliance
thereon, whether or not notation of such action is made upon such Debenture.
Section 1.3. Notices, Etc., to Company. Any request, demand,
authorization, direction, notice, consent, waiver or Act of Debentureholders or
other document provided or permitted by this Agreement to be made upon, given or
furnished to, or filed with, the Company by any Debentureholder shall be
sufficient for every purpose hereunder (except as provided in subsections a. and
b. of Section 6.1) if in writing and mailed, first class, postage prepaid, to
the Company addressed to it at the address of its principal executive offices
specified in the first paragraph of this instrument or at any other address
previously furnished in writing by the Company.
Section 1.4. Notices to Debentureholders; Waiver.
a. Where this Agreement provides for giving notice to
Debentureholders of any event, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and mailed, first class
postage prepaid, to each Debentureholder at his address as it appears in the
Debenture Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the first giving of such notice. Where this
Agreement provides for the giving of notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Debentureholders shall be filed with the Company, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
b. In the event that it shall be impracticable to mail notice
of any event to Debentureholders when such notice is required to be given
pursuant to any provision of this Agreement by reason of the suspension of
regular mail service, as a result of a strike, work stoppage or similar
activity, then any manner of giving such notice as shall be satisfactory to the
Company shall be deemed to be a sufficient giving of such notice.
Section 1.5. Effect of Heading and Table of Contents. The Article and
Section headings herein are for convenience only and shall not affect the
construction hereof.
Section 1.6. Successors and Assigns. All covenants and agreements in
this Agreement by the Company shall bind its successors and assigns, whether so
expressed or not.
<PAGE> 7
Section 1.7. Separability Clause. In case any provision in this
Agreement or in the Debentures shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 1.8. Benefit of Agreement. Nothing in this Agreement or in the
Debentures, express or implied, shall give to any person, other than the parties
hereto and their successors hereunder, any benefit or any legal or equitable
right, remedy or claim under this Agreement.
Section 1.9. Governing Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of Colorado.
Section 1.10. Legal Holidays. In any case where the date of any
Interest Payment Date, Redemption Date or the Stated Maturity of any Debenture
shall not be a Business Day, then (notwithstanding any other provision of the
Debentures or this Agreement) payment of the principal of or interest on any
Debenture need not be made on such date, but may be made on the next succeeding
Business Day with the same force and effect as if made on the nominal date of
any such Interest Payment Date, Redemption Date or Stated Maturity, as the case
may be, and no interest shall accrue for the period from and after any such
nominal date.
Section 1.11. Execution in Counterparts. This Agreement may be executed
in any number of counterparts, each of which so executed shall be deemed to be
an original, but all such counterparts shall together constitute but one and the
same document.
Section 1.12. Entire Agreement. This Agreement constitutes and embodies
the entire understanding and agreement of the parties and supersedes and
replaces all prior understandings, agreements and negotiations between and among
the parties.
Section 1.13. Waiver and Modification. Any waiver, alteration or
modification of any of the provisions of this Agreement shall be valid only if
made in writing and signed by the parties hereto.
Section 1.14. Attorneys' Fees. The parties agree that, should
litigation arise in relation to this Agreement or its enforcement, as between
the Company and the Debentureholders, the losing party or parties, jointly and
severally, agree to pay the prevailing party or parties the amount of such
prevailing party's or parties' reasonable attorneys' fees, expenses and costs.
ARTICLE TWO
THE DEBENTURES
Section 2.1. Titles and Terms.
a. The Debentures shall be known and designated as the "9%
Debentures Due June 28, 2006" of the Company. Their stated maturity shall be
June 28, 2006 and they shall bear interest from their date of issuance, payable
quarterly on March 31, June 30, September 30 and December 31
<PAGE> 8
of each year commencing on June 30, 1998, at the rate of nine per cent per annum
until the principal thereof has been paid or duly provided for.
b. Every Debenture shall be dated the date of its issuance,
and shall bear interest quarterly on March 31, June 30, September 30 and
December 31, next preceding the date of such Debenture to which interest on the
Debenture has been paid, unless the date of such Debenture is a date to which
such interest has been paid, in which case from the date of such Debenture or
unless the date of such Debenture is prior to the first date to which such
interest has been paid, in which case from June 30, 1998. However, so long as
there is no existing default in the payment of interest on the Debentures, every
Debenture authenticated by the Debenture Registrar after the close of business
on the Record Date for any Interest Payment Date (March 1, June 1, September 1
or December 1, as the case may be) and prior to such Interest Payment Date shall
be dated the date of its issuance but shall bear interest from such Interest
Payment Date; provided, however, that and if the extent that the Company shall
default in the payment of interest due on such Interest Payment Date then any
such Debenture shall bear interest from March 31, June 30, September 30 or
December 31 as the case may be, next preceding the date of such Debenture to
which such interest has been paid or June 30, 1998, in the case of default in
the first payment of interest.
c. Interest payable with respect to a Debenture on an Interest
Payment Date shall be paid to the Holder of such Debenture (or any Debenture or
Debentures issued upon the transfer thereof, or in exchange therefor or in lieu
thereof) at the close of business on the Record Date with respect to such
Interest Payment Date, except that if and to the extent the Company shall
default in the payment of the interest due on such Interest Payment Date, such
defaulted interest shall be paid to the Holder of such Debenture (or any
Debenture or Debentures issued upon the transfer thereof or in exchange therefor
or in lieu thereof) at the close of business on the date of payment of such
defaulted interest, or the Record Date, if the Company shall establish any, with
respect to which payment of such defaulted interest is to be made.
d. Interest which is paid on a Debenture on any Interest
Payment Date shall be paid by check to the order of the person entitled to such
payment, mailed to his last address appearing in the Debenture Register.
Section 2.2. Execution, Delivery and Dating.
a. The Debentures shall be issued only as registered
Debentures without coupons. The Debentures shall be executed on behalf of the
Company by its Chairman of the Board of Directors, its President or one of its
Vice Presidents under its corporate seal reproduced thereon and attested by its
Treasurer, Secretary or one of its Assistant Secretaries. The signature of any
of these officers on the Debentures may be manual or facsimile.
b. At any time and from time to time after the creation and
delivery of this Agreement, the Company may deliver such Debentures as in this
Agreement provided and not otherwise.
c. Each Debenture shall be dated the date of its issuance.
Section 2.3. Registration, Transfer and Exchange.
<PAGE> 9
a. The Company shall cause to be kept at its principal
executive offices in Glendale, California, a register (herein sometimes referred
to as the "Debenture Register") in which, subject to such reasonable regulations
as it may prescribe, the Company shall provide for the registration of
Debentures and the registration of transfers of Debentures. The Company is
hereby appointed "Debenture Registrar" for the purpose of registering Debentures
and effecting transfers of Debentures as herein provided.
b. Upon surrender for transfer of any Debenture at the office
of the Company in the Place of Payment, the Debenture Registrar shall execute
and deliver, in the name of the designated transferee or transferees, one or
more new Debentures of a like aggregate principal amount, all as requested by
the transferor.
c. All Debentures surrendered upon any exchange or transfer
provided for in this Agreement shall be promptly canceled by the Debenture
Registrar and thereafter disposed of as directed by a Company Order.
d. Every Debenture presented or surrendered for transfer or
exchange shall (if so required by the Debenture Registrar) be duly endorsed, or
be accompanied by a written instrument of transfer in form satisfactory to the
Debenture Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing.
e. No service charge shall be made for any transfer or
exchange of Debentures, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge imposed in connection therewith.
f. The Company shall not be required to transfer or exchange
any Debenture called or being called for redemption in whole or in part.
Section 2.4. Mutilated, Destroyed, Lost or Stolen Debentures.
a. A mutilated Debenture may be surrendered and thereupon the
Debenture Registrar shall execute and deliver in exchange therefor a new
Debenture of like tenor and principal amount, bearing a number not
contemporaneously outstanding.
b. If there be delivered to the Debenture Registrar (i)
evidence to its satisfaction of the destruction, loss or theft of any Debenture
and (ii) such security or indemnity as may be required by it to save the Company
harmless, then, in the absence of notice to the Debenture Registrar that such
Debenture has been acquired by a bona fide purchaser, the Debenture Registrar
shall execute and deliver in lieu of any such destroyed, lost or stolen
Debenture, a new Debenture of like tenor and principal amount, bearing a number
not contemporaneously outstanding.
c. In case any such mutilated, destroyed, lost or stolen
Debenture has become or is about to become due and payable, or has been called
or selected for redemption, the Company in its discretion may, instead of
issuing a new Debenture, pay such Debenture.
d. Upon the issuance of any new Debenture under this Section,
the Debenture Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge
<PAGE> 10
that may be imposed in relation thereto and any other reasonable expenses
(including the fees and expenses of the Debenture Registrar) connected
therewith.
e. Every new Debenture issued pursuant to this Section in lieu
of any destroyed, lost or stolen Debenture shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Debenture shall be at any time enforceable by anyone, and shall
be entitled to all the benefits of this Agreement equally and proportionately
with any and all other Debentures duly issued hereunder.
f. The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Debentures.
Section 2.5. Interest Rights Preserved. Each Debenture delivered under
this Agreement upon transfer of or in exchange for or in lieu of any other
Debenture shall (subject to Section 2.1.) carry all of the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Debenture,
and each such Debenture shall be so dated in order that neither gain nor loss in
interest shall result from such transfer, exchange or substitution.
Section 2.6. Persons Deemed Owners. The Company and any agent of the
Company may treat the Person in whose name any Debenture is registered as the
owner of such Debenture for the purpose of receiving payment of the principal
of, and (subject to Section 2.1.) interest on, such Debenture and for all other
purposes whatsoever whether or not such Debenture be overdue, and neither the
Company nor any agent of the Company shall be affected by notice to the
contrary.
Section 2.7. Cancellation. All Debentures surrendered for payment,
transfer, exchange, conversion or redemption shall, if surrendered to any person
other than the Debenture Registrar, be delivered to the Debenture Registrar and,
if not already canceled, shall be promptly canceled by it. All Debentures
surrendered for payment, transfer, exchange, conversion or redemption to the
Debenture Registrar shall be promptly canceled. No Debentures shall be issued in
lieu of or in exchange for any Debentures canceled as provided in this Section,
except as expressly permitted by this Agreement. All canceled Debentures held by
the Debenture Registrar shall be disposed of as directed by a Company Order,
which may provide for the destruction thereof.
ARTICLE THREE
TERMINATION OF AGREEMENT
Section 3.1. Satisfaction and Discharge of Agreement. This Agreement
shall cease to be of further effect (except as to any surviving rights of
redemption or transfer or exchange of Debentures herein expressly provided for
and rights to receive payments of interest thereon), and the responsibilities of
the Company under this Agreement shall be satisfied and discharged when
a. Either
<PAGE> 11
(i) All Debentures theretofore delivered (other than
(a) Debentures which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 2.4. and (b) Debentures for whose
payment money has theretofore been segregated and held in trust by the Company
and thereafter repaid to the Company or discharged from such trust, as provided
in subsection c. of Section 5.1.) have been canceled or delivered to the Company
for cancellation; or
(ii) All such Debentures not theretofore canceled or
delivered to the Company for cancellation
(a) Have become due and payable,
(b) Will become due and payable at their
Stated Maturity within one year,
(c) Have been presented to the Company for
redemption, or
(d) Are to be called for redemption within
one year under arrangements satisfactory to the Debentureholders for the giving
of notice of redemption by the Company at its expense,
and the Company, in the case of subsections (a), (b), (c) or (d) above, has
caused to be segregated and held in trust, as trust funds in trust for the
purpose, an amount (said amount to be immediately due and payable to the Holders
of the Debentures) sufficient to pay and discharge the entire indebtedness of
such Debentures not theretofore canceled or delivered to the Company for
cancellation, for principal and interest to the date of such segregation (in the
case of Debentures which have become due and payable) or to the Stated Maturity
or Redemption Date, as the case may be; and
b. The Company has paid or caused to be paid all other
sums payable hereunder by the Company.
Section 3.2. Application of Trust Money. All money segregated pursuant
to Section 3.1. shall be held in trust and applied by the Company in accordance
with the provisions of the Debentures and this Agreement to the payment directly
to the Debentureholders for whose payment or redemption such money has been
segregated, of all sums due and to become due thereon for principal and
interest; but such money need not be segregated from other funds except to the
extent required by law. The Company shall give notice at its expense of the
immediate availability of the money segregated pursuant to Section 3.1. to the
Persons entitled to such money.
ARTICLE IV
COLLATERAL
Section 4.1. Security Interest in Personalty. To secure the prompt
payment to the Debentureholders of the Liabilities, the Company hereby grants to
the Debentureholders, jointly and severally, a continuing first priority
security interest in and to all of its following property and interests
<PAGE> 12
in property, whether now owned or existing or hereinafter acquired or arising
and wheresoever located:
a. Accounts;
b. Equipment;
c. Inventory;
d. General Intangibles;
e. All monies, residues and property of any kind now, or at
any time or times hereinafter, in the possession or under the control of the
Debentureholders or a bailee of the Debentureholders;
f. All accessions to, substitutions for and all replacements,
products and proceeds of the foregoing, including, without limitation, proceeds
of insurance policies insuring the collateral; and
g. All books and records (including, without limitation,
customer lists, credit files, computer programs, printouts and other computer
materials and records) of the Company pertaining to any of the foregoing.
(All of the property and interests in property described in subsections (a),
(b), (c), (d), (e), (f) and (g) and all other property and interests in property
which shall, from time to time, secure the Liabilities, including, without
limitation, those described in Section 4.2. immediately below, are herein
collectively referred to as the "Collateral.")
Section 4.2. Security Interest in Real Estate. In addition to the other
Collateral, the Liabilities shall be secured by mortgages conveying a first
priority security interest in any real estate owned by the Company hereinafter,
in any case inclusive of all fixtures appurtenant to any such improved real
property and subject only to usual and ordinary title exceptions. In any such
case, the Debentureholders shall have received from the Company each of the
following:
a. A duly executed mortgage in form and substance reasonably
satisfactory to the Debentureholders with respect to the real property, duly
recorded in the appropriate recording offices with all recording fees and taxes,
if any, paid thereon; and
b. A title insurance policy or binder, in customary form, with
premiums paid thereon, issued by a title insurance company acceptable to the
Debentureholders, and insuring that the Debentureholders' mortgages constitute
valid second priority liens on the real estate described therein, free and clear
of any and all defects and encumbrances whatsoever, other than usual and
ordinary title exceptions acceptable to the Debentureholders in their sole
discretion.
Section 4.3 Disclosure of Security Interest. The Company shall make
appropriate entries upon its financial statements and its books and records
disclosing the Debentureholders' security interest in the Collateral.
<PAGE> 13
Section 4.4 Financing Statements. At the Debentureholders' request, the
Company shall execute and/or deliver to the Debentureholders, at any time or
times hereinafter, all Supplemental Documentation that the Debentureholders may
reasonably request, in form and substance acceptable to the Debentureholders,
and pay the costs of any recording or filing of the same. Upon the occurrence of
an Event of Default, the Company hereby irrevocably makes, constitutes and
appoints the Debentureholders (and all Persons designated by the
Debentureholders for that purpose) as the Company's true and lawful attorney
(and agent-in-fact) to sign the name of the Company on any of the Supplemental
Documentation to such Persons as the Debentureholders, in their sole discretion,
may elect. The Company agrees that a photographic, photostatic or other
reproduction of this Agreement or of a financing statement is sufficient as a
financing statement.
Section 4.5 Inspection. The Debentureholders (by any of their agents)
shall have the right, at any time or times during the Company's usual business
hours, to inspect the Collateral, all records related thereto (and to make
extracts from such records), and the premises upon which any of the Collateral
is located, to discuss the Company's affairs and finances with any Person and to
verify the amount, quality, quantity, value and condition of, or any other
matter relating to, the Collateral.
Section 4.6. Perfection and Priority; Location of Collateral. The
Company warrants and represents that:
a. None of the Collateral is subject to any lien, security
interest or other encumbrance, except as disclosed on Exhibit C attached hereto
and incorporated herein by this reference.
b. The offices and/or locations where the Company keeps the
Collateral and books and records, including, without limitation, computer
programs, printouts and other computer materials and records concerning the
Collateral, are at the locations set forth on Exhibit C, and the Company shall
not remove such books and records and/or the Collateral therefrom, except for
removal of Inventory upon its sale, and shall not keep any of such books and
records and/or the Collateral at any other office(s) or location(s) unless (i)
the Company gives the Debentureholders written notice of such removal and the
new location of said books and records and/or the Collateral at least thirty
(30) days prior thereto and (ii) the other office or location is within the
continental United States of America.
Section 4.7. Debentureholders' Payment of Claims Asserted Against
Company. The Debentureholders may, at any time or times hereinafter, in their
sole discretion and without waiving or releasing any obligation, liability or
duty of the Company under this Agreement or the Other Agreements, or any Event
of Default, pay, acquire and/or accept an assignment of any security interest,
lien, claim or encumbrance asserted by any Person against the Collateral;
provided that the Debentureholders shall first give the Company written notice
of their intent to do the same, and the Company does not, within ten (10) days
of such notice, pay such claim and/or obtain to the Debentureholders' reasonable
satisfaction the release of the security interests, liens, claims or
encumbrances to which such notice relates. All sums paid by the Debentureholders
in respect thereof and all costs, fees and expenses, including reasonable
attorneys' fees, court costs, expenses and other charges relating thereto, which
are incurred by the Debentureholders on account thereof, shall be payable, on
demand, by the Company to the Debentureholders and shall be additional
Liabilities hereunder secured by the Collateral.
<PAGE> 14
ARTICLE V
COVENANTS
Section 5.1 General Warranties and Representations. The Company
warrants and represents that:
a. Payment of Principal, Premium and Interest. The Company
will duly and punctually pay the principal of and interest on the Debentures in
accordance with the terms of the Debentures and this Agreement.
b. Maintenance of Office. The Company will maintain an office
in the Place of Payment where Debentures may be presented or surrendered for
Payment, where Debentures may be presented or surrendered for transfer, exchange
or conversion and where notices and demands to or upon the Company in respect of
the Debentures and this Agreement may be served and where the principal and
interest of the Debentures shall be payable. The Company will give prompt
written notice of the location, and of any change in the location, of such
office. If at any time the Company shall fail to maintain such office or shall
fail to give notice of the address thereof, such presentations, surrenders,
notices and demands may be made or served at the principal executive offices of
the Company in Glendale, California. The Company may maintain one or more
additional offices for any of such purposes, within or without the Place of
Payment, and will give prompt written notice of the location, and of any change
in the location, of any such additional office.
c. Money for Debenture Payments to Be Held in Trust. The
Company will, on or before each due date of the principal of or interest on any
of the Debentures, segregate and hold in trust for the benefit of the Holders of
such Debentures a sum sufficient to pay the principal or interest so becoming
due until such sums shall be paid to such Holders or otherwise disposed of as
herein provided. Any money then held by the Company, in trust for the payment of
the principal of or interest on any Debenture and remaining unclaimed for six
years after such principal or interest has become due and payable shall be paid
to the Company on Company request, or (if then held by the Company) shall be
discharged from such trust; and the holder of such Debenture shall thereafter,
as an unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Company as trustee of such trust money, shall thereupon
cease; provided, that, before making any such repayment, the Company shall send
notice to the persons entitled to such unclaimed money at their last address
appearing on the Debenture Register, unless previous communications forwarded to
such addresses have been returned unclaimed.
d. Payment of Taxes and Other Claims. The Company will pay or
discharge or cause to be paid or discharged, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges levied or
imposed upon it or upon its income, profits or property and (ii) all lawful
charges for labor, materials and supplies which, if unpaid, might by law become
a lien upon its property; provided, however, that the Company shall not be
required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings.
e. Maintenance of Properties. The Company will cause all the
properties of the Company and of any Subsidiary, used or useful in the conduct
of the business of the Company or of
<PAGE> 15
such Subsidiary, to be maintained and kept in good condition, repair and working
order and supplied with all necessary equipment and will cause to be made all
necessary repairs, renewals, replacements, betterments and improvements thereof,
all as in the judgment of the Company may be necessary so that the business
carried on in connection therewith may be properly and advantageously conducted
at all times; provided, however, that nothing in this Section shall prevent the
Company or any Subsidiary from discontinuing the operation and maintenance of
any of its properties if such discontinuance is, in the judgment of the Company
or such Subsidiary, respectively, desirable in the conduct of its business and
not disadvantageous in any material respect to the Debentureholders.
f. Corporate Existence. The Company will do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence, rights (charter and statutory) and franchises; provided,
however, that the Company shall not be required to preserve any right or
franchise if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company,
and that the loss thereof is not disadvantageous in any material respect to the
Debentureholders.
g. Insurance. The Company will insure and keep insured, and
will cause each of its Subsidiaries to insure and keep insured, to a reasonable
amount with reputable insurance companies, so long as any of the Debentures
shall be outstanding, all property of a character usually insured by
corporations engaged in the same or a similar business against loss or damage of
the kinds customarily insured against by such corporations (including without
limitation against all tort or product liability claims) and carry, and cause
each of its Subsidiaries to carry, such other insurance, all in such amounts and
against such risks, as is usually carried by corporations engaged in the same or
a similar business or owning similar properties.
h. Authorization. The Company has the right and power and is
duly authorized and empowered to enter into, execute, deliver and perform the
Debentures, this Agreement and the Other Agreements executed concurrently
herewith. The execution, delivery and/or performance by the Company of the
Debentures, this Agreement and the other Agreements shall not, by the lapse of
time, the giving of notice or otherwise, constitute a violation of any
applicable law or a breach of any provision contained in the Articles of
Incorporation or Bylaws of the Company or contained in any agreement, instrument
or document to which the Company is now a party or by which it is otherwise
bound.
Section 5.2. Negative Covenants. Without the Debentureholders' prior
written consent, which the Debentureholders may or may not, in their reasonable
discretion, give concurrently herewith or hereinafter, the Company covenants
that it shall not:
a. Merge, consolidate with or acquire any Person.
b. Other than in the ordinary course of its business, make any
investment in the securities of any Person.
c. Except as otherwise expressly permitted herein or in the
Other Agreements, encumber, pledge, mortgage, grant a security interest in,
assign, sell, lease or otherwise dispose of or transfer, whether by sale,
merger, consolidation, liquidation, dissolution or otherwise, any of the
Collateral.
<PAGE> 16
d. Incur any Indebtedness for borrowed money (other than the
Liabilities), except for Indebtedness which is unsecured or is to Persons who
execute and deliver to the Debentureholders (in form and substance acceptable to
the Debentureholders and their counsel) subordination agreements subordinating
their claims against the Company to the payment of the Liabilities.
e. Make any substantial change in the nature or scope of or
discontinue or dispose of any part of the Company's business.
Section 5.3. Contesting Charges. Notwithstanding anything to the
contrary herein, the Company may dispute any Charges without prior payment
thereof, even if such non-payment may cause a lien to attach to the assets of
the Company, provided that the Company shall have given the Debentureholders
written notice of said dispute and shall be diligently contesting the same in
good faith in an appropriate proceeding and, provided further that, if the same
are in excess of $10,000 in the aggregate at any time or times hereinafter, the
Company has given the Debentureholders such additional collateral and assurances
that the Debentureholders, in their sole discretion, deems necessary under the
circumstances.
Section 5.4. Payment of Charges. Subject to the provisions of Section
5.3 immediately above, the Company shall pay promptly when due all of the
Charges. In the event that the Company, at any time or times hereinafter, shall
fail to pay the Charges or to promptly obtain the discharge of such Charges, the
Company shall so advise the Debentureholders thereof in writing and the
Debentureholders may, without waiving or releasing any obligation or liability
of the Company hereunder or any Event of Default, in their sole discretion, at
any time or times thereafter, make such payment, or any part thereof, or obtain
such discharge and take any other action with respect thereto which the
Debentureholders deem advisable. All sums so paid by the Debentureholders and
any expenses, including reasonable attorneys' fees, court costs, expenses and
other charges relating thereto, shall be payable, upon demand, by the Company to
the Debentureholders and shall be additional Liabilities hereunder secured by
the Collateral.
Section 5.5. Insurance; Payment of Premiums. All policies of insurance
on the Collateral shall be in form and with insurers recognized as adequate by
prudent business persons and all such policies shall be in such amounts as may
be satisfactory to the Debentureholders. If requested, the Company shall deliver
to the Debentureholders the original (or certified copy) of each policy of
insurance and evidence of payment of all premiums therefor.
ARTICLE VI
EVENTS OF DEFAULT; REMEDIES
Section 6.1. Events of Default. "Event of Default," wherever used
herein, shall mean any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be 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):
<PAGE> 17
a. The default by the Company in the payment of any
installment of interest upon any Debenture when it becomes due and payable and
the same is not cured within thirty (30) days; or default in the payment of the
principal of any Debenture at its maturity; or default in the performance of or
breach of any other covenant or warranty of the Company in this Agreement and
the same is not cured to the Debentureholders' satisfaction within thirty (30)
days after the Debentureholders give the Company written notice, by registered
or certified mail, identifying such Event of Default.
b. The default by the Company in the payment of the
Liabilities when due and payable or declared due and payable or default in the
payment of any other portion of the Indebtedness and the same is not cured
within thirty (30) days; or default in the performance of or breach of any other
covenant or warranty of the Company in the Other Agreements and the same is not
cured to the Debentureholders' satisfaction within thirty (30) days after the
Debentureholders give the Company written notice, by registered or certified
mail, identifying such Event of Default.
c. The filing by the Company of a voluntary petition or answer
seeking liquidation, reorganization, arrangement, readjustment of its debts or
for any other relief under the United States Bankruptcy Code of 1978, 11 U.S.C.
Section 101 et. seq., as amended (the "Bankruptcy Code"), or under any other act
or law pertaining to insolvency or debtor relief, whether state, Federal or
foreign, now or hereinafter existing; or any agreement by the Company indicating
its consent to, approval of or acquiescence in any such petition or proceeding;
the application by the Company for, or the appointment by consent or
acquiescence of a receiver, custodian or trustee of the Company or for all or a
substantial part of its property; the making by the Company of an assignment for
the benefit of creditors; or the inability or failure of the Company , or the
admission in writing by the Company of its inability or failure generally, to
pay its debts as such debts become due.
d. The filing of an involuntary petition against the Company
seeking liquidation, reorganization, arrangement, readjustment of its debts or
for any other relief under the Bankruptcy Code, or under any other act or law
pertaining to insolvency or debtor relief, whether state, Federal or foreign,
now or hereinafter existing, or the involuntary appointment of a receiver,
custodian or trustee of the Company or for all or a substantial part of its
property; the entry of a material judgment or the issuance of a warrant of
attachment, execution or similar process against any substantial part of the
property of the Company; and either (i) the continuance of any of the foregoing
for sixty (60) days undismissed, unbonded or undischarged or (ii) within such
sixty (60) day period, the entry of an order for relief under the Bankruptcy
Code in any such case or proceeding.
e. The cessation of business operations by the Company or the
enjoining, restraining or prevention of the Company by court order from
conducting all or any material part of its business affairs.
f. Except as permitted under Section 5.3. hereinabove, the
filing of record of a notice of lien, levy or assessment with respect to all or
any of the Company's assets by the United States, or any department, agency or
instrumentality thereof, or by any state, county, municipal or other
governmental agency, or if any taxes or debts owing at any time or times
hereinafter to any one of them becomes a lien or encumbrance upon the Collateral
or any of the Company's assets and the same is not released within sixty (60)
days after it becomes a lien or encumbrance.
<PAGE> 18
Section 6.2. Acceleration of Maturity; Rescission and Annulment. If an
Event of Default occurs and is continuing, then and in every such case the
Holders of the Debentures may declare the principal of the Debentures to be due
and payable immediately, by a notice in writing to the Company, and upon any
such declaration such principal shall become immediately due and payable. At any
time after such a declaration of acceleration has been made and before a
judgment or decree for payment of the money due has been obtained by the
Debentureholders as hereinafter in this Article provided, the Company, by
written notice to the Debentureholders, may rescind and annul such declaration
and its consequences if:
a. The Company has paid or segregated a sum sufficient to pay
all overdue installments of interest on the Debentures; and
b. All Events of Default, other than the nonpayment of the
principal of the Debentures, have been cured or waived as provided in Section
6.9.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 6.3. Collection of Indebtedness and Suits for Enforcement. The
Company covenants that if
a. Default is made in the payment of any installment of
interest on any Debenture when such interest becomes due and payable and such
default continues for a period of thirty (30) days, or
b. Default is made in the payment of the principal of any
Debenture at the Maturity thereof, the Company will, upon demand of the
Debentureholders, pay to them the whole amount then due and payable on such
Debentures for principal and, in addition thereto, such further amount as shall
be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the agents and
counsel of the Debentureholders. If an Event of Default occurs and is
continuing, the Debentureholders may in their discretion proceed to protect and
enforce their rights by such appropriate judicial proceedings as the
Debentureholders shall deem most effectual to protect and enforce any such
rights, whether for the specific enforcement of any covenant or agreement in
this Agreement or in aid of the exercise of any power granted herein, or to
enforce any other proper remedy.
Section 6.4. Debentureholders May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or the property of the Company, the
Debentureholders (irrespective of whether the principal of the Debentures shall
then be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Debentureholders shall have made any demand on the
Company for the payment of overdue principal or interest) shall be entitled and
empowered, by intervention in such proceeding or otherwise:
a. To file and prove a claim for the whole amount of principal
and interest owing and unpaid in respect of the Debentures and to file such
other papers or documents as may be necessary or advisable in order to have the
claims of the Debentureholders (including any claim for the reasonable
compensation, expenses, disbursements and advances of their agents and counsel)
allowed in such judicial proceedings; and
<PAGE> 19
b. To collect and receive any monies or other property payable
or deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, liquidator, sequestrator (or other similar
official) in any such judicial proceeding is hereby authorized by each
Debentureholder to make such payments directly to them.
Section 6.3 Application of Money Collected. Any money collected
pursuant to this Article shall be applied in the following order and, in case of
the distribution of such money on account of principal or interest, upon
presentation of the Debentures, and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:
a. First: To the payment of costs and expenses of collection;
b. Second: In case the principal of the Debentures shall not
have become due, to the payment of interest on the Debentures, in the order of
the Maturity of the installments of such interest, such payments to be made
ratably to the Persons entitled thereto, without discrimination or preference;
c. Third: In case the principal of the Debentures shall have
become due, by declaration as authorized by this Agreement or otherwise, to the
payment of the whole amount then owing and unpaid upon the Debentures for
principal and interest, with interest on the overdue principal at the rate per
annum expressed in the Debentures; and in case such monies shall be insufficient
to pay in full the whole amount so due and unpaid upon the Debentures, then to
the payment of such principal and interest, without preference or priority of
principal over interest, or of interest over principal, or of any installment of
interest over any other installment of interest, or of any Debenture over any
other Debentures, ratably to the aggregate of such principal and accrued and
unpaid interest; and
d. Fourth: Any monies remaining after the payment in full of
all sums required to be paid under the foregoing paragraphs a., b. and c., shall
be paid over to the Company.
Section 6.5. Limitation on Suits. No Debentureholder shall have any
right to institute any proceeding, judicial or otherwise, with respect to this
Agreement, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless such Debentureholder has previously given written
notice of a continuing Event of Default; it being understood and intended than
no one or more Debentureholders shall have any right in any manner whatever by
virtue of, or by availing of, any provision of this Agreement to affect, disturb
or prejudice the rights of any other Debentureholder, or to obtain or to seek to
obtain priority or preference over any other Debentureholder or to enforce any
right under this Agreement, except in the manner herein provided and for the
equal and ratable benefit of the Debentureholders.
Section 6.6. Unconditional Right of Debentureholders to Receive
Principal and Interest. Notwithstanding any other provision in this Agreement
(but subject to Section 2.1.), the Holder of any Debenture shall have the right
which is absolute and unconditional to receive payment of the principal of and
interest on such Debenture on the respective Stated Maturities expressed in such
Debenture (or, in the case of redemption pursuant to Article Seven or Eight, on
the Redemption Date subject to the
<PAGE> 20
limitations of Article Seven or Eight) and to institute suit for the enforcement
of any such payment, and such right shall not be impaired without the consent of
such Holder.
Section 6.7. Restoration of Rights and Remedies. If any Debentureholder
has instituted any proceeding to enforce any right or remedy under this
Agreement and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to such Debentureholder, then and in every such
case the Company and the Debentureholders shall, subject to any determination in
such proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the
Debentureholders shall continue as though no such proceeding had been
instituted.
Section 6.8. Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Debentureholders is intended to be exclusive
of any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereinafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
Section 6.9. Delay or Omission Not Waiver. No delay or omission of any
Debentureholder to exercise any right or remedy accruing upon any Event of
Default shall impair any such right or remedy or constitute a waiver of any such
Event of Default or an acquiescence therein. Every right and remedy given by
this Article or by law to the Debentureholders may be exercised from time to
time, and as often as may be deemed expedient by the Debentureholders.
Section 6.10. Waiver of Past Defaults. The Holders of the Debentures
may waive any past default hereunder and its consequences, except a default
a. In the payment of the principal of or interest on any
Debenture, or
b. In respect of a covenant or provision hereof which cannot
be modified or amended without the consent of the Holder of each Debenture
affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Agreement; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
Section 6.11. Undertaking for Costs. All parties to this Agreement
agree, and each Debentureholder by his acceptance thereof shall be deemed to
have agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Agreement, or in any suit against
the Company for any action taken or omitted by it, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by any Debentureholder(s), or to any suit
instituted by any Debentureholder(s) for the enforcement of the payment of the
principal or interest on any Debenture on or after the respective Stated
Maturities
<PAGE> 21
expressed in such Debenture for such principal or interest (or, in the case of
redemption, on or after the Redemption Date).
Section 6.12. Waiver of Stay or Extension Laws. The Company covenants
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereinafter in force, which may affect the covenants or the performance of this
Agreement; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefits or advantage of any such law, and covenants that
it will not hinder, delay or impede the execution of any power herein granted to
the Company, but will suffer and permit the execution of every such power as
though no such law had been enacted.
Section 6.13. Secured Creditor Status. If an Event of Default occurs
and is continuing, than and in every such case the Debentureholders shall have
all of the following rights and remedies;
a. All of the rights and remedies of a secured party under the
Uniform Commercial Code of the state where such rights and remedies are
asserted, or under other applicable law, all of which rights and remedies shall
be cumulative, and none exclusive, to the extent permitted by law, in addition
to any other rights and remedies contained in this Agreement and in all of the
Other Agreements.
b. The right to (i) enter upon the premises of the Company,
without any obligation to pay rent to the Company, through self-help and without
judicial process, without first obtaining a final judgment or giving the Company
notice and opportunity for a hearing on the validity of the Debentureholders'
claim and without any obligation to pay rent to the Company, or any other place
or places where the Collateral is located and kept, and remove the Collateral
therefrom to the premises of the Debentureholders or any agent of the
Debentureholders, for such time as the Debentureholders may desire, in order to
effectively collect or liquidate the Collateral and/or (ii) require the Company
to assemble the Collateral and make it available to the Debentureholders at a
place to be designated by the Debentureholders, in their sole discretion.
c. The right to sell or to otherwise dispose of all or any
Collateral in its then condition, or after any further manufacturing or
processing thereof, at public or private sale or sales, without such notice as
may be required by law, in lost or in bulk, for cash or on credit, all as the
Debentureholders, in their sole discretion may deem advisable; such sales may be
adjourned from time to time with or without notice. The Debentureholders hall
have the right to conduct such sales on the premises of the Company or elsewhere
and shall have the right to use such premises without charge for such sales for
such time or times as the Debentureholders may see fit. The Debentureholders are
hereby granted a license or other right to use, without charge, the Company's
labels, patents, copyrights, rights of use of any name, trade secrets, trade
names, trademarks and advertising matter, or any property of a similar nature,
as it pertains to the Collateral, in advertising for sale and selling and
Collateral and the Company's rights under all licenses and all franchise
agreements shall inure to the Company's benefit. The Debentureholders shall have
the right to sell, lease or otherwise dispose of the Collateral, or any part
thereof, for cash, credit or any combination thereof, the Debentureholders may
purchase all or any part of the collateral at public or, if permitted by law,
private sale and, in lieu of actual payment of such purchase price, may set off
the amount of such price against the Liabilities. The proceeds realized from the
sale of any Collateral shall be applied first to the reasonable costs,
<PAGE> 22
expenses and attorneys' fees and expenses incurred by the Company for collection
and for acquisition, completion, protection, removal, storage, sale and delivery
of the Collateral; second to interest due upon any of the Liabilities; and third
to the principal of the Liabilities. If any deficiency shall arise, the Company
shall remain liable to the Debentureholders therefor.
d. Notice. Any notice required to be given by the Debentureholders of a
sale, lease other disposition of the Collateral or any other intended action by
the Debentureholders, deposited in the United States mail, postage prepaid and
duly addressed to the Company ten (10) days prior to such proposed action, shall
constitute commercially reasonable and fair notice to the Company.
e. Appointment of Debentureholders as Company's Lawful Attorney. Upon
and after an Event of Default, the Company irrevocably designates, makes,
constitutes and appoints the Debentureholders (and all persons designated by the
Debentureholders) as the Company's true and lawful attorney (and agent-in-fact)
and the Debentureholders, or the Debentureholders' agent, may, without notice to
the Company, and at such time or times thereafter as the Debentureholders or
said agent, in their sole discretion, may determine, in the Debentureholders' or
the Company's name: (i) demand payment of the Accounts; (ii) enforce payment of
the Accounts, by legal proceedings or otherwise; (iii) exercise all of the
Company's rights and remedies with respect to the collection of the Accounts and
Collateral; (iv) settle, adjust, compromise, extend or renew the Accounts; (v)
settle, adjust or compromise any legal proceedings brought to collect the
Accounts; (vi) if permitted by applicable law, sell or assign the Accounts upon
such terms, for such amounts and at such time or times as the Company deems
advisable; (vii) discharge and release the Accounts; (viii) take control, in any
manner, of any item of payment or proceeds; (ix) prepare, file and sign the
Company's name on a Proof of Claim in Bankruptcy or similar document against any
Account Debtor; (x) prepare, file and sign the Company's name on any Notice of
Lien, Assignment or Satisfaction of Lien or similar document in connection with
the Accounts and Collateral; (xi) do all acts and things necessary, in the
Debentureholders' sole discretion, to fulfill the Company's obligations under
this Agreement; (xii) endorse the names of the Debentureholders upon any of the
items of payment or proceeds and deposit the same to the account of the
Debentureholders on account of the Liabilities; (xiii) endorse the name of the
Company upon any chattel paper, document, instrument, invoice, freight bill,
bill of lading or similar document or agreement relating to the Accounts,
Inventory and Special Collateral; (xiv) use the Company's stationery and sign
the name of the Company to verifications of the Accounts and notices thereof to
Account Debtors; and (xv) use the information recorded on or contained in any
data processing equipment and computer hardware and software relating to the
Accounts, Inventory and Collateral to which the Company has access.
ARTICLE SEVEN
REDEMPTION OF DEBENTURES BY COMPANY
Section 7.1. Right of Redemption. The Debentures shall be subject to
redemption at any time on or after December 28, 1996, at the option of the
Company, as a whole, or from time to time in part, in each case upon payment of
the Redemption Price which shall consist of the principal amount of the
Debentures so redeemed set forth in the forms of Debenture attached hereto as
Exhibits A and B, plus in each case (subject to Section 7.6.) interest accrued
to the Redemption Date on such Debentures.
<PAGE> 23
Section 7.2. Applicability of Article. Redemption of Debentures at the
option of the Company as permitted or required by any provision of this
Agreement, shall be made in accordance with such provision and this Article.
Section 7.3. Election To Redeem. The election of the Company to redeem
any Debenture shall be evidenced by a resolution of the Board of Directors. For
all purposes of this Agreement, unless the context otherwise requires, all
provisions relating to the redemption of Debentures at the option of the Company
shall relate, in the case of any Debenture redeemed or to be redeemed only in
part, to the portion of the principal of such Debenture which has been or is to
be redeemed.
Section 7.4. Notice of Redemption. Notice of redemption shall be given
by first-class mail, postage prepaid, mailed not less than thirty (30) nor more
than sixty (60) days prior to the Redemption Date, to each Holder of a Debenture
to be redeemed, at his last address appearing in the Debenture Register.
All notices of redemption shall state:
a. The Redemption Date,
b. The Redemption Price,
c. The identification (and, in the case of partial redemption,
the respective principal amounts) of the Debentures to be redeemed,
d. That on the Redemption Date the Redemption Price will
become due and payable upon each such Debenture, and that interest thereon shall
cease to accrue on and after said date,
e. The place where such Debenture is to be surrendered for
payment of the Redemption Price, which shall be the office of the Company in the
Place of Payment and each appropriate additional office established in
accordance with subsection b. of Section 5.1.
Any notice which is mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the Holder
receives the notice. In any case, failure duly to give notice by mail, or any
defect in the notice, to the Holder of any Debenture designated for redemption
as a whole or in part shall not affect the validity of the proceedings for the
redemption of any Debenture.
Notice of redemption of Debentures to be redeemed at the election of
the Company shall be given by the Company.
Section 7.5. Deposit of Redemption Price. At least one business day
prior to any Redemption Date, the Company shall segregate and hold in trust as
provided in subsection c. of Section 5.1. an amount of money sufficient to pay
the Redemption Price of all the Debentures which are to be redeemed on such
Redemption Date.
<PAGE> 24
Section 7.6. Debentures Payable on Redemption Date. Notice of
redemption having been given as aforesaid, the Debenture so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified and on and after such date (unless the Company shall default
in the payment of the Redemption Price) such Debenture shall cease to bear
interest. Upon surrender of any such Debenture for redemption in accordance with
said notice, said Debenture shall be paid by the Company at the Redemption
Price. Interest maturing on an Interest Payment Date which is payable on or
prior to the Redemption Date shall continue to be payable (but without interest
thereon, unless the Company shall default in the payment thereof) to the persons
entitled thereto according to the terms of this Agreement in the customary
manner. If any Debenture called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid, bear interest
from the Redemption Date at the rate provided by the Debenture.
Section 7.7. Debentures Redeemed in Part. Any Debenture which is to be
redeemed only in part shall be surrendered (with, if the Company so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to
the Company duly executed by the Holder thereof or his attorney duly authorized
in writing) and the Company shall execute, authenticate and deliver to the
Holder of such Debenture, without service charge, a new Debenture as requested
by such Holder in aggregate principal amount equal to the unredeemed portion of
the principal of the Debenture so surrendered.
ARTICLE EIGHT
LIMITED RIGHT OF REDEMPTION BY DEBENTUREHOLDERS
Section 8.1. Limited Right of Redemption. The Debentures shall be
subject to redemption at any time after June 28, 1998, by the Holders thereof,
by payment by the Company of the Redemption Price which shall consist of the
principal amount of such Debenture plus (in each case (subject to Section 8.5.)
interest accrued to the Redemption Date.
Section 8.2. Applicability of Article. Redemption of Debentures by
exercise of the limited right of redemption as permitted or required by any
provision of this Agreement, shall be made in accordance with such provision and
this Article.
Section 8.3. Election to Redeem. The election of a Holder to redeem a
Debenture in whole or in part shall be made by delivering to the Company at the
Place of Payment, a request for redemption, in form satisfactory to the Company,
together with the Debenture to be redeemed. The date of receipt of such request
together with the Debenture shall be the Presentment Date thereof. The
Redemption Date of such Debentures shall be not more than thirty (30) days from
the Presentment Date (subject to Section 8.5.). For all purposes of this Loan
and Security Agreement, unless the context otherwise requires, all provisions
relating to the limited right of redemption by Holders shall relate, in the case
of any Debenture so redeemed or to be redeemed only in part, to the portion of
the principal of such Debenture which has been or is to be redeemed.
Section 8.4. Deposit of Redemption Price. Subject to the provisions of
Section 8.6., not later than the due date of the principal of or interest on any
of the Debentures, the Company shall segregate and hold in trust as provided in
subsection c. of Section 5.1. an amount of money sufficient to pay the
<PAGE> 25
Redemption Price of the Debentures. No Debenture presented for redemption
pursuant to this Article 8. shall be subject to redemption at the option of the
Company pursuant to the provisions of Article 9. of this Agreement or otherwise
after the redemption thereof, nor shall such Debenture bear interest after the
Redemption Date thereof, unless, until and to the extent the request for
redemption is withdrawn.
Section 8.5. Debentures Payable on Redemption Date. Notice of election
to redeem having been given and received as aforesaid, the Debenture so to be
redeemed shall on the Redemption Date (subject to the provisions of Section
8.6.), become due and payable at the Redemption Price, and on and after such
date (unless the Company shall default in the payment of the Redemption Price)
such Debenture shall cease to bear interest. The Company shall pay or cause to
be paid the Redemption Price for such Debenture on the Redemption Date. Interest
maturing on an Interest Payment Date which is on or prior to the Redemption Date
shall continue to be payable to the persons entitled thereto according to the
terms of this Agreement in the customary manner.
Section 8.6. Limitation on Right of Redemption. Debentures presented
for redemption pursuant to this Article 8. shall be paid in the order of their
respective Presentment Dates.
Section 8.7. Debentures Redeemed in Part. Any Debenture which is to be
redeemed only in part pursuant to this Article 8. shall be surrendered with such
notice as is required by Section 8.3. of this Agreement (together with, if the
Company so requires, due endorsement by or a written instrument of transfer in
form satisfactory to the Company duly executed by the Holder thereof or his
attorney duly authorized in writing) and the Company shall execute and deliver
to the Holder of such Debenture, without service charge, a new Debenture in the
principal amount equal to the unredeemed portion of the principal of the
Debenture so surrendered.
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement effective the day and year first above written.
ATTEST: LOGAN MEDICAL DEVICES, INC.
By: By: /s/ Ronald Bruce Logan-Sinclair
------------------------------ ------------------------------------
, Secretary Ronald Bruce Logan-Sinclair, President
/s/ Ronald Bruce Logan-Sinclair /s/ Howard George Vincent Cooke
------------------------------ ------------------------------------
Ronald Bruce Logan-Sinclair Howard George Vincent Cooke
<PAGE> 1
EXHIBIT 10.90
LOGAN MEDICAL DEVICES, INC.
DEBENTURE
DUE JUNE 28, 2006
$285,714.29
FOR VALUE RECEIVED, the undersigned, Logan Medical Devices, Inc., a
Colorado corporation (hereinafter referred to as the "Company," which term
includes any successor corporation under the Loan and Security Agreement
hereinafter referred to), with its principal office located at 506 Paula Avenue,
Glendale, California 91201, hereby agrees and promises to pay to Ronald Bruce
Logan-Sinclair, 2 Clarendon Drive, Rochester, Kent, ME2 3LT, United Kingdom, or
registered assigns (hereinafter referred to as the "Holder"), on June 28, 2,006,
the principal sum of two hundred and eighty-five thousand seven hundred fourteen
dollars and twenty-nine cents ($285,714.29) and to pay interest on said
principal sum, until payment of the principal hereof has been made or duly
provided for, at the rate of nine per cent (9%) per annum, calculated on the
basis of a 360-day year, consisting of 12-thirty day months, payable quarterly
on March 31, June 30, September 30 and December 31 of each year commencing on
June 30, 1998.
The interest so payable on March 31, June 30, September 30 or December
31, as the case may be, shall, subject to certain exceptions provided in the
Loan and Security Agreement hereinafter referred to, be paid to the person in
whose name this debenture, or any debenture previously outstanding, upon the
transfer of, or in exchange for, or in lieu of, which this debenture
(hereinafter referred to as the "Debenture") was issued, was registered at the
close of business on March 1, June 1, September 1 or December 1, as the case may
be, by check to the order of the person appearing on the Debenture Register of
the Company. Payment of the principal and interest (other than interest paid by
check as aforesaid) on this Debenture will be made at the principal office of
the Company in the City of Glendale, County of Los Angeles, State of California,
in such coin or currency of the United States of America which at the time of
payment is legal tender for the payment of public and private debts.
This Debenture is a duly authorized Debenture of the Company issued and
to be issued under that certain Loan and Security Agreement of even date
herewith (hereinafter referred to as the "Loan and Security Agreement"), between
the Company and the Holder, to which Loan and Security Agreement reference is
made for a statement of the respective rights thereunder of the Company and the
Holder, and the terms upon which the Debenture is, and is to be, authenticated
and delivered.
The provisions of the Loan and Security Agreement and the Debenture are
to be governed by and construed in accordance with the laws of the State of
Colorado.
As provided in the Loan and Security Agreement, the Debenture may be
redeemed at any time on or after December 28, 1996, at the option of the
Company, as a whole, or from time to time in part, in each case on not less than
thirty (30) nor more than sixty (60) days' prior written notice given by
<PAGE> 2
mail as provided in the Loan and Security Agreement and upon payment of the
redemption price (hereinafter referred to as the "Redemption Price"), which
shall consist of the principal amount of the Debenture plus interest accrued to,
and not paid on or before, the date of redemption (hereinafter referred to as
the "Redemption Date").
As provided in the Loan and Security Agreement, upon the presentment by
the Holder at any time on or after June 28, 1998, of a request for redemption
together with the Debenture held by such Holder (hereinafter referred to as the
"Presentment Date"), the Company shall redeem such Debenture by paying the
Redemption Price not more than thirty (30) days from the Presentment Date.
It is provided in the Loan and Security Agreement that, upon partial
redemption of the Debenture, the same shall be surrendered in exchange, without
service charge, for a new Debenture in aggregate principal amount equal to the
unredeemed portion of the principal of the Debenture so surrendered.
The Debenture (or portion thereof as aforesaid) for whose redemption
and payment provision is made in accordance with the Loan and Security Agreement
shall cease to bear interest on the date fixed for redemption.
If an Event of Default, as defined in the Loan and Security Agreement,
shall occur, the principal of the Debenture may be declared due and payable in
the manner and with the effect provided in the Loan and Security Agreement.
The Loan and Security Agreement permits, with certain exceptions as
therein provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holder under the Loan and
Security Agreement at any time by the Company with the consent of the Holder.
The Loan and Security Agreement also contains provisions permitting the Holder
by written consent to waive compliance by the Company with certain provisions of
the Loan and Security Agreement and certain past defaults under the Loan and
Security Agreement and their consequences. Any such consent or waiver by the
Holder shall be conclusive and binding upon such Holder and upon all future
Holders of this Debenture and of any Debenture issued upon the transfer hereof
or in exchange herefor or in lieu hereof whether or not notation of such consent
or waiver is made upon this Debenture.
As provided in the Loan and Security Agreement and subject to certain
limitations therein set forth, this Debenture is transferable by the registered
holder hereof on the Debenture Register of the Company, upon surrender of this
Debenture for transfer at the principal office of the Company where the
principal hereof and interest hereon are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company duly executed by, the registered holder hereof or his attorney duly
authorized in writing, and thereupon a new Debenture for the same aggregate
principal amount will be issued to the designated transferee or transferees. No
service charge shall be made for any such transfer, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Subject to the provisions of the Loan and Security Agreement, the
Company and any agent of the Company may treat the person in whose name this
Debenture is registered as the absolute owner
<PAGE> 3
hereof for all purposes whether or not this Debenture be overdue, and neither
the Company nor any such agent shall be affected by notice to the contrary.
This Debenture is issued as a registered Debenture without coupons.
IN WITNESS WHEREOF, the Company has caused this Debenture to be signed
by its President or one of its Vice Presidents, which may be a facsimile of his
or her signature, and attested by its Treasurer, Secretary or one of its
Assistant Secretaries, which may be a facsimile of his or her signature.
Effective date: June 28, 1996
LOGAN MEDICAL DEVICES, INC.
By: /S/ Ronald Bruce Logan-Sinclair
-------------------------------------
Ronald Bruce Logan-Sinclair,
President
<PAGE> 1
EXHIBIT 10.99
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED UNDER
THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR QUALIFIED UNDER
APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION OR
QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 55,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Aubrey Hornsby or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Aubrey Hornsby
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Aubrey Hornsby ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized by
the Company's Board of Directors to PRCC and PRCC is desirous of having Optionee
continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 55,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 55,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may exercised in whole or in
part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC,
is true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Aubrey Hornsby
3371 Addison Drive
Pensacola, FL 32514
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except signed by an instrument in writing signed by the party sought to
be charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC: POLLUTION RESEARCH AND CONTROL CORP.,
a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
---------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive
Officer
OPTIONEE: /s/ AUBREY HORNSBY
-------------------------------------
Aubrey Hornsby
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of ____________ as
to ____________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- ------------------------- -------------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.100
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 40,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Ernestine Taylor or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above
number of fully paid and nonassessable shares of Common Stock of the Company
("Common Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Ernestine Taylor
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Ernestine Taylor ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 40,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 40,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) Her overall commitment to investments that are not
readily marketable is not disproportionate to her net worth, and her investment
in PRCC will not cause such overall commitment to become excessive;
(d) She has the financial ability to bear the economic
risk of her investment, has adequate means of providing for her current needs
and personal contingencies, and has no need for liquidity in her investment in
PRCC;
(e) She either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
her interests in connection with the transaction;
(f) She has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information she has desired in order to
evaluate her investment, and to consult with such attorneys, accountants and
other advisors as she has desired;
(g) Her residence set forth below is her true and correct
residence, and she has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, she has relied solely upon independent
investigations made by or on behalf of her;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) She understands that all the representations and
warranties made by her herein, and all information furnished by her to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that she understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Ernestine Taylor
225 Brent Lane
Pensacola, FL 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
--------------------------------
Albert E. Gosselin, Jr.,
President and Chief
Executive Officer
OPTIONEE:
/s/ ERNESTINE TAYLOR
--------------------------------
Ernestine Taylor
--------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of _______________
as to _________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- --------------------------- -------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.101
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 30,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Debbie Kendrick or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1. 10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Debbie Kendrick
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Debbie Kendrick ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 30,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 30,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased
pursuant to the Option, the purchase price for each Option share shall be $1.10
(the ""Option Price"), and for purposes of record, the bid price of the
Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) Her overall commitment to investments that are not
readily marketable is not disproportionate to her net worth, and her investment
in PRCC will not cause such overall commitment to become excessive;
(d) She has the financial ability to bear the economic
risk of her investment, has adequate means of providing for her current needs
and personal contingencies, and has no need for liquidity in her investment in
PRCC;
(e) She either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
her interests in connection with the transaction;
(f) She has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information she has desired in order to
evaluate her investment, and to consult with such attorneys, accountants and
other advisors as she has desired;
(g) Her residence set forth below is her true and correct
residence, and she has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, she has relied solely upon independent
investigations made by or on behalf of her;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) She understands that all the representations and
warranties made by her herein, and all information furnished by her to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that she understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to this
Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Debbie Kendrick
225 Brent Lane
Pensacola, FL 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
-------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ DEBBIE KENDRICK
------------------------------
Debbie Kendrick
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
_______________ as to __________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4
of my Agreement regarding the Option.
_________________________________ _______________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.102
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE,
OPTION TO PURCHASE 25,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Roland Fink or registered assigns, is entitled, subject
to the terms set forth below, to purchase from Pollution Research and Control
Corp., a California corporation (the "Company"), the above number of fully
paid and nonassessable shares of Common Stock of the Company ("Common Stock")
at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including
5:00 p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Roland Fink
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Roland Fink ("Optionee").
WHEREAS, Optionee has been providing valuable services as
recognized by the Company's Board of Directors to PRCC and PRCC is desirous of
having Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 25,000 shares of the no par value common stock
of PRCC (the "Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as
a matter of separate agreement and not in lieu of other compensation for
services, the right and option (the "Option") to purchase on the terms and
conditions set forth in this Agreement all or any part of up to an aggregate of
25,000 shares of Common Stock (the "Option Shares"), for continuous,
uninterrupted, employment service to PRCC or by specific acknowledgement of
exception by the Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common
Stock are to be purchased pursuant to the Option, the purchase price for each
Option share shall be $1.10 (the ""Option Price"), and for purposes of record,
the bid price of the Company's stock on this date was $.94 cents.
3 . OPTION PERIOD. The option period shall commence on January
7, 1998 (the "Date of Grant") and shall terminate four (4) years from the Date
of Grant.
4. EXERCISE OF OPTION. The Option may be exercised in
whole or in part at any time after the date hereof by delivering to the Chief
Financial Officer of PRCC (a) a Notice and Agreement of Exercise of Option,
substantially in the form attached hereto as Exhibit "A," specifying the number
of Option Shares with respect to which the Option is exercised, and (b) full
payment of the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have
not been registered under the Securities Act of 1933, as amended (the "Act"),
and no Shares may be sold, offered for sale, transferred, pledged, hypothecated
or otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him,
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED
OR UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS
TO BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Roland Fink
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding
5
<PAGE> 6
options of PRCC to Optionee and supersedes all prior communications, oral or
written;
(b) Shall not be construed to give Optionee any rights as to
PRCC or the Common Stock, except as specifically provided herein,
(c) May not be amended nor may any rights hereunder be
waived except signed by the party sought to be charged with such amendment or
waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
---------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ ROLAND FINK
-------------------------------------
Roland Fink
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of ______________
as to ________________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
_____________________________ ________________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.103
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Charles Conner or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Charles Conner
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Charles Conner ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 20,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 20,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Charles Conner
225 Brent Lane
Pensacola, FL 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived; except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
---------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ CHARLES CONNER
-------------------------------------
Charles Conner
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of ____________ as
to ______________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
_______________________________ __________________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.104
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Patricia Cudd or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Patricia Cudd
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Patricia Cudd ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 20,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 20,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3 . OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) Her overall commitment to investments that are not
readily marketable is not disproportionate to her net worth, and her investment
in PRCC will not cause such overall commitment to become excessive;
(d) She has the financial ability to bear the economic
risk of her investment, has adequate means of providing for her current needs
and personal contingencies, and has no need for liquidity in her investment in
PRCC;
(e) She either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
her interests in connection with the transaction;
(f) She has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information she has desired in order to
evaluate her investment, and to consult with such attorneys, accountants and
other advisors as she has desired;
(g) Her residence set forth below is her true and correct
residence, and she has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, she has relied solely upon independent
investigations made by or on behalf of her,
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) She understands that all the representations and
warranties made by her herein, and all information furnished by her to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that she understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED
OR UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS
TO BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to him upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Patricia Cudd
50 S. Steele St.
Suite 222
Denver, CO 80209
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by instrument in writing signed by the party sought to be charged
with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
-------------------------------
Albert E. Gosselin, Jr.,
President and Chief
Executive Officer
OPTIONEE:
/s/ PATRICIA CUDD
----------------------------------
Patricia Cudd
----------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of _______________
as to __________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
__________________________________ __________________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.105
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Jeffrey Harkey or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock")at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Jeffrey Harkey
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Jeffrey Harkey ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 20,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 20,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all books, records
and documents of PRCC and to ask questions and receive answers from PRCC
concerning PRCC's business, to obtain additional information necessary to
verify the accuracy of the information he has desired in order to evaluate his
investment, and to consult with such attorneys, accountants and other advisors
as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or purchase
the Option Shares, he has relied solely upon independent investigations made by
or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and warranties
made by him herein, and all information furnished by him to PRCC, is true,
correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. TRANSFERABILITY OF OPTION. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Jeffrey Harkey
225 Brent Lane
Pensacola, Fl 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and Optionee
regarding options of PRCC to Optionee and supersedes all prior communications,
oral or written;
(b) Shall not be construed to give Optionee any rights as to PRCC
or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be waived
except by an instrument in writing signed by the party sought to be charged
with such amendment or waiver;
(d) Shall be construed in accordance with, and governed by, the
laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit of PRCC
and Optionee, and their respective successors and assigns, except that Optionee
shall not have the right to assign or otherwise transfer his rights hereunder
to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
--------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ JEFFREY HARKEY
----------------------------------
Jeffrey Harkey
----------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of______
______________as to_________________________ shares of PRCC's no par value
Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- ---------------------------------- -----------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.106
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE,
OPTION TO PURCHASE 10,000 SHARES OF COMMON STOCK OF POLLUTION RESEARCH AND
CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies James Bowers or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: James Bowers
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and James Bowers ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 10,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 10,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3 . OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his
true and correct residence, and he has no present intention of becoming a
resident or domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: James Bowers
225 Brent Lane
Pensacola, Fl 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and Optionee
regarding options of PRCC to Optionee and supersedes all prior communications,
oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed by
the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit of
PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
----------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ JAMES BOWERS
----------------------------------
James Bowers
----------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of______
__________as to_______________________________ shares of PRCC's no par value
Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- ---------------------------------- -----------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.107
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE,
OPTION TO PURCHASE 10,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Michael Jones or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Michael Jones
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Michael Jones ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 10,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 10,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3 . OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS, THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to him upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Michael Jones
225 Brent Lane
Pensacola, FL 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except
that Optionee shall not have the right to assign or otherwise transfer his
rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
------------------------------
Albert E. Gosselin, Jr.,
President and Chief
Executive Officer
OPTIONEE:
/s/ MICHAEL JONES
--------------------------------
Michael Jones
----------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of______
__________as to_______________________________ shares of PRCC's no par value
Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- ---------------------------------- -----------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.108
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE,
OPTION TO PURCHASE 10,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6,2002
This certifies Charles McQuaig or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Charles McQuaig
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Charles McQuaig ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 10,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 10,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law,
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS, THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of A shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Charles McQuaig
225 Brent Lane
Pensacola, Fl 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
------------------------------
Albert E. Gosselin, Jr.,
President and Chief
Executive Officer
OPTIONEE:
/s/ CHARLES McQUAIG
---------------------------------
Charles McQuaig
---------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of______
__________as to_______________________________ shares of PRCC's no par value
Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- ---------------------------------- -----------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.109
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 10,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Daniel Patanjo or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Daniel Patanjo
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Daniel Patanjo ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 10,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 10,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Daniel Patanjo
225 Brent Lane
Pensacola, FL 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except signed by an instrument in writing signed by the party sought to
be charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
---------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ DANIEL PATANJO
-------------------------------------
Daniel Patanjo
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of _______
as to ____________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
________________________________ ___________________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.110
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 10,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Karen Perry or registered assigns, is entitled, subject
to the terms set forth below, to purchase from Pollution Research and Control
Corp., a California corporation (the "Company"), the above number of fully paid
and nonassessable shares of Common Stock of the Company ("Common Stock") at a
purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Karen Perry
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Karen Perry ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 10,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 10,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) Her overall commitment to investments that are not
readily marketable is not disproportionate to her net worth, and her investment
in PRCC will not cause such overall commitment to become excessive;
(d) She has the financial ability to bear the economic
risk of her investment, has adequate means of providing for her current needs
and personal contingencies, and has no need for liquidity in her investment in
PRCC;
(e) She either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
her interests in connection with the transaction;
(f) She has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information she has desired in order to
evaluate her investment, and to consult with such attorneys, accountants and
other advisors as she has desired;
(g) Her residence set forth below is her true and correct
residence, and she has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, she has relied solely upon independent
investigations made by or on behalf of her;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) She understands that all the representations and
warranties made by her herein, and all information furnished by her to PRCC,
is true, correct and complete in all respects.
6. Optionee hereby acknowledges that she understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Karen Perry
225 Brent Lane
Pensacola, FL 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written,
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
---------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ KAREN PERRY
-------------------------------------
Karen Perry
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of __________ as to
__________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
____________________________________ __________________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.111
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 10,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Ricky Sonnier or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Ricky Sonnier
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Ricky Sonnier ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 10,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 10,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Ricky Sonnier
225 Brent Lane
Pensacola, FL 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
---------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ RICKY SONNIER
-------------------------------------
Ricky Sonnier
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of _________ as to
___________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
_________________________________ ________________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.112
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 10,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Victor Valerio or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
P.M., Los Angeles time, on January 6, 2002.
Registered Owner: Victor Valerio
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Victor Valerio ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 10,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 10,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid
price of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC,
is true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY,"
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Victor Valerio
225 Brent Lane
Pensacola, Fl 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any fights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
--------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ VICTOR VALERIO
------------------------------------
Victor Valerio
------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of______________ as
to ________________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- ---------------------------------- ----------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.113
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE,
OPTION TO PURCHASE 5,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Spencer Abrams or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Spencer Abrams
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Spencer Abrams ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 5,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 5,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
5 . SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered
2
<PAGE> 3
under the Securities Act of 1933, as amended (the "Act"), and no Shares may be
sold, offered for sale, transferred, pledged, hypothecated or otherwise
disposed of except in compliance with the Act and any other applicable federal
and state securities laws. Additionally, the Option and the Option Shares have
not been qualified under the California Securities Law of 1968, as amended (the
"California Law"). PRCC has no obligation to register the Option shares under
the Act or qualify the Option Shares under the California Law. Optionee
acknowledges that he is aware that Rule 144 of the General Rules and
Regulations under the Act ("Rule 144") affords a limited exemption from
registration for the public resale of registered securities and under the terms
of Rule 144 as currently in effect, the Shares received by Optionee may be sold
to the public without registration only after a period of two (2) years has
elapsed from the exercise date of the Option and then only in compliance with
all other requirements of Rule 144 and the Act. Optionee hereby acknowledges,
represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged, and has
the business or financial experience or has business or financial advisors who
are unaffiliated
3
<PAGE> 4
with, and not compensated by, PRCC and protect his interests in connection with
the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him,
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto;
"THE SHARES REPRESENTED BY THIS CERTIFICATE
4
<PAGE> 5
HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE
SECURITIES LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR UNLESS
AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO
THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Spencer Abrams
225 Brent Lane
Pensacola, FL 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
12. GENERAL PROVISIONS. This Agreement:
5
<PAGE> 6
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ SPENCER ABRAMS
----------------------------------
Spencer Abrams
----------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of ______________ as
to ________________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- ---------------------------------- ----------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.114
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 5,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Dan Busby or registered assigns, is entitled, subject
to the terms set forth below, to purchase from Pollution Research and Control
Corp., a California corporation (the "Company"), the above number of fully paid
and nonassessable shares of Common Stock of the Company ("Common Stock") at a
purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Dan Busby
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of May 31, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Dan Busby ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 5,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 5,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered
2
<PAGE> 3
under the Securities Act of 1933, as amended (the "Act"), and no Shares may be
sold, offered for sale, transferred, pledged, hypothecated or otherwise
disposed of except in compliance with the Act and any other applicable federal
and state securities laws. Additionally, the Option and the Option Shares have
not been qualified under the California Securities Law of 1968, as amended (the
"California Law"). PRCC has no obligation to register the Option shares under
the Act or qualify the Option Shares under the California Law. Optionee
acknowledges that he is aware that Rule 144 of the General Rules and
Regulations under the Act ("Rule 144") affords a limited exemption from
registration for the public resale of registered securities and under the terms
of Rule 144 as currently in effect, the Shares received by Optionee may be sold
to the public without registration only after a period of two (2) years has
elapsed from the exercise date of the Option and then only in compliance with
all other requirements of Rule 144 and the Act. Optionee hereby acknowledges,
represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged, and has
the business or financial experience or has business or financial advisors who
are unaffiliated
3
<PAGE> 4
with, and not compensated by, PRCC and protect his interests in connection with
the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
"THE SHARES REPRESENTED BY THIS CERTIFICATE
4
<PAGE> 5
HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE
SECURITIES LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR UNLESS
AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO
THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Dan Busby
225 Brent Lane
Pensacola, FL 32503
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
12. GENERAL PROVISIONS. This Agreement:
5
<PAGE> 6
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
--------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ DAN BUSBY
----------------------------------
Dan Busby
----------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of_______________ as
to ________________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- ---------------------------------- ----------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.115
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 5,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Frank Getautas or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Frank Getautas
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into effective as of May 31, 1996 by and between Pollution Research and
Control Corp., a California corporation ("PRCC") and Frank Getautas
("Optionee").
WHEREAS, Optionee has been providing valuable services as
recognized by the Company's Board of Directors to PRCC and PRCC is desirous of
having Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 5,000 shares of the no par value common stock
of PRCC (the "Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as
a matter of separate agreement and not in lieu of other compensation for
services, the right and option (the "Option") to purchase on the terms and
conditions set forth in this Agreement all or any part of up to an aggregate of
5,000 shares of Common Stock (the "Option Shares"), for continuous,
uninterrupted, employment service to PRCC or by specific acknowledgement of
exception by the Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common
Stock are to be purchased pursuant to the Option, the purchase price for each
Option share shall be $1.10 (the "Option Price"), and for purposes of
record, the bid price of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on
January 7, 1998 (the "Date of Grant") and shall terminate four (4) years from
the Date of Grant.
4. EXERCISE OF OPTION. The Option may be
exercised in whole or in part at any time after the date hereof by delivering
to the Chief Financial Officer of PRCC (a) a Notice and Agreement of Exercise
of Option, substantially in the form attached hereto as Exhibit "A," specifying
the number of Option Shares with respect to which the Option is exercised, and
(b) full payment of the Option Price for such Shares.
5. SECURITIES LAWS REQUIREMENTS. The Option Shares
have not been registered
2
<PAGE> 3
under the Securities Act of 1933, as amended (the "Act"), and no Shares may be
sold, offered for sale, transferred, pledged, hypothecated or otherwise
disposed of except in compliance with the Act and any other applicable federal
and state securities laws. Additionally, the Option and the Option Shares have
not been qualified under the California Securities Law of 1968, as amended (the
"California Law"). PRCC has no obligation to register the Option shares under
the Act or qualify the Option Shares under the California Law. Optionee
acknowledges that he is aware that Rule 144 of the General Rules and
Regulations under the Act ("Rule 144") affords a limited exemption from
registration for the public resale of registered securities and under the terms
of Rule 144 as currently in effect, the Shares received by Optionee may be sold
to the public without registration only after a period of two (2) years has
elapsed from the exercise date of the Option and then only in compliance with
all other requirements of Rule 144 and the Act. Optionee hereby acknowledges,
represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall
be sold or otherwise distributed in violation of the Act, the California Law or
any other applicable federal or state securities law;
(c) His overall commitment to investments that
are not readily marketable is not disproportionate to his net worth, and his
investment in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the
economic risk of his investment, has adequate means of providing for his
current needs and personal contingencies, and has no need for liquidity in his
investment in PRCC;
(e) He either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged, and has the business or financial experience or has business or
financial advisors who are unaffiliated
3
<PAGE> 4
with, and not compensated by, PRCC and protect his interests in connection with
the transaction;
(f) He has been given the opportunity to review
all books, records and documents of PRCC and to ask questions and receive
answers from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and
correct residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option
and/or purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any
finding or determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations
and warranties made by him herein, and all information furnished by him to
PRCC, is true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the
meaning and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach
and any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued
pursuant to this Agreement shall be subject to the provisions of this Agreement
and the certificates representing such Option Shares shall bear the following
legend or language substantially equivalent thereto:
"THE SHARES REPRESENTED BY THIS CERTIFICATE
4
<PAGE> 5
HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE
SECURITIES LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR
QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF
WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. TRANSFERABILITY OF OPTION. The Option shall
not be transferable except by the laws of descent and distribution and any
attempt to do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and
kind of Option Shares shall be subject to corresponding adjustment in the event
of any change in the Common stock by reason of any reclassification,
recapitalization, split-up, combination, exchange of shares, readjustment or
stock dividend, in like manner as if such Option Shares had been issued and
outstanding, fully paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any
of the rights of a shareholder with respect to the shares covered by the Option
except to the extent that one or more certificates for such Shares shall be
delivered to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be
given under this Agreement shall be in writing and they shall be deemed to have
been given upon personal delivery or two (2) business days after mailing the
notice by postage, registered or certified mail. Such notice shall be
addressed to the party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Frank Getautas
225 Brent Lane
Pensacola, Fl 32503
Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.
12. GENERAL PROVISIONS. This Agreement:
5
<PAGE> 6
(a) Contains the entire agreement between PRCC
and Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any
rights as to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights
hereunder be waived except by an instrument in writing signed by the party
sought to be charged with such amendment or waiver;
(d) Shall be construed in accordance with, and
governed by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the
benefit of PRCC and Optionee, and their respective successors and assigns,
except that Optionee shall not have the right to assign or otherwise transfer
his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ Albert E. Gosselin
------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ Frank Getautas
---------------------
Frank Getautas
---------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
___________as to ____________________________________ shares of PRCC's no par
value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
- ------------------------------- ---------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.116
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 5,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies Mitzi Narramore or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Mitzi Narramore
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into effective as of May 31, 1996 by and between Pollution Research and
Control Corp., a California corporation ("PRCC") and Mitzi Narramore
("Optionee").
WHEREAS, Optionee has been providing valuable services as
recognized by the Company's Board of Directors to PRCC and PRCC is desirous of
having Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 5,000 shares of the no par value common stock
of PRCC (the "Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as
a matter of separate agreement and not in lieu of other compensation for
services, the right and option (the "Option") to purchase on the terms and
conditions set forth in this Agreement all or any part of up to an aggregate of
5,000 shares of Common Stock (the "Option Shares"), for continuous,
uninterrupted, employment service to PRCC or by specific acknowledgement of
exception by the Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common
Stock are to be purchased pursuant to the Option, the purchase price for each
Option share shall be $1.10 (the "Option Price"), and for purposes of
record, the bid price of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on
January 7, 1998 (the "Date of Grant") and shall terminate four (4) years from
the Date of Grant.
4. EXERCISE OF OPTION. The Option may be exercised in
whole or in part at any time after the date hereof by delivering to the Chief
Financial Officer of PRCC (a) a Notice and Agreement of Exercise of Option,
substantially in the form attached hereto as Exhibit "A," specifying the number
of Option Shares with respect to which the Option is exercised, and (b) full
payment of the Option Price for such Shares.
5. SECURITIES LAWS REQUIREMENTS. The Option Shares
have not been registered
2
<PAGE> 3
under the Securities Act of 1933, as amended (the "Act"), and no Shares may be
sold, offered for sale, transferred, pledged, hypothecated or otherwise
disposed of except in compliance with the Act and any other applicable federal
and state securities laws. Additionally, the Option and the Option Shares have
not been qualified under the California Securities Law of 1968, as amended (the
"California Law"). PRCC has no obligation to register the Option shares under
the Act or qualify the Option Shares under the California Law. Optionee
acknowledges that he is aware that Rule 144 of the General Rules and
Regulations under the Act ("Rule 144") affords a limited exemption from
registration for the public resale of registered securities and under the terms
of Rule 144 as currently in effect, the Shares received by Optionee may be sold
to the public without registration only after a period of two (2) years has
elapsed from the exercise date of the Option and then only in compliance with
all other requirements of Rule 144 and the Act. Optionee hereby acknowledges,
represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall
be sold or otherwise distributed in violation of the Act, the California Law or
any other applicable federal or state securities law;
(c) Her overall commitment to investments that
are not readily marketable is not disproportionate to her net worth, and her
investment in PRCC will not cause such overall commitment to become excessive;
(d) She has the financial ability to bear the
economic risk of her investment, has adequate means of providing for her
current needs and personal contingencies, and has no need for liquidity in her
investment in PRCC;
(e) She either: (i) has a preexisting personal
or business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged, and has the business or financial experience or has business or
financial advisors who are unaffiliated
3
<PAGE> 4
with, and not compensated by, PRCC and protect her interests in connection with
the transaction;
(f) She has been given the opportunity to review
all books, records and documents of PRCC and to ask questions and receive
answers from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information she has desired in order to
evaluate her investment, and to consult with such attorneys, accountants and
other advisors as she has desired;
(g) Her residence set forth below is her true and
correct residence, and she has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option
and/or purchase the Option Shares, she has relied solely upon independent
investigations made by or on behalf of her;
(i) No federal or state agency has made any
finding or determination as to the fairness of an investment in PRCC; and
(j) She understands that all the representations
and warranties made by her herein, and all information furnished by her to
PRCC, is true, correct and complete in all respects.
6. Optionee hereby acknowledges that she understands the
meaning and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach
and any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued
pursuant to this Agreement shall be subject to the provisions of this Agreement
and the certificates representing such Option Shares shall bear the following
legend or language substantially equivalent thereto:
"THE SHARES REPRESENTED BY THIS CERTIFICATE
4
<PAGE> 5
HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE
SECURITIES LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR
QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF
WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall
not be transferable except by the laws of descent and distribution and any
attempt to do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and
kind of Option Shares shall be subject to corresponding adjustment in the event
of any change in the Common stock by reason of any reclassification,
recapitalization, split-up, combination, exchange of shares, readjustment or
stock dividend, in like manner as if such Option Shares had been issued and
outstanding, fully paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any
of the rights of a shareholder with respect to the shares covered by the Option
except to the extent that one or more certificates for such Shares shall be
delivered to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be
given under this Agreement shall be in writing and they shall be deemed to have
been given upon personal delivery or two (2) business days after mailing the
notice by postage, registered or certified mail. Such notice shall be
addressed to the party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Mitzi Narramore
225 Brent Lane
Pensacola, Fl 32503
Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.
12. GENERAL PROVISIONS. This Agreement:
5
<PAGE> 6
(a) Contains the entire agreement between PRCC
and Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any
rights as to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights
hereunder be waived except by an instrument in writing signed by the party
sought to be charged with such amendment or waiver;
(d) Shall be construed in accordance with, and
governed by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the
benefit of PRCC and Optionee, and their respective successors and assigns,
except that Optionee shall not have the right to assign or otherwise transfer
his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ Albert E. Gosselin
------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ Mitzi Narramore
---------------------
Mitzi Narramore
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH
AND CONTROL CORP., a California corporation ("PRCC"), dated as of ________as
to ______________________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
- ------------------------------- ----------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.117
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 300,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Ron Logan-Sinclair or registered assigns, is
entitled, subject to the terms set forth below, to purchase from Pollution
Research and Control Corp., a California corporation (the "Company"), the above
number of fully paid and nonassessable shares of Common Stock of the Company
("Common Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including
5:00 p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Ron Logan-Sinclair
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement")
is made and entered into effective as of June 1, 1996 by and between Pollution
Research and Control Corp., a California corporation ("PRCC") and Ron
Logan-Sinclair ("Optionee").
WHEREAS, Optionee has been providing
valuable services as recognized by the Company's Board of Directors to PRCC and
PRCC is desirous of having Optionee continue to provide such services to it;
and
WHEREAS, PRCC is willing to grant
Optionee an option to purchase up to an aggregate of 300,000 shares of the no
par value common stock of PRCC (the "Common Stock") under the terms and
conditions set forth below.
NOW, THEREFORE, the parties agree as
follows:
1. GRANT OF OPTION. PRCC hereby
grants to Optionee, as a matter of separate agreement and not in lieu of other
compensation for services, the right and option (the "Option") to purchase on
the terms and conditions set forth in this Agreement all or any part of up to
an aggregate of 300,000 shares of Common Stock (the "Option Shares"), for
continuous, uninterrupted, employment service to PRCC or by specific
acknowledgement of exception by the Company's Board of Directors.
2. OPTION PRICE. At any time
when shares of Common Stock are to be purchased pursuant to the Option, the
purchase price for each Option share shall be $1.10 (the "Option Price"), and
for purposes of record, the bid price of the Company's stock on this date was
$.94 cents.
3. OPTION PERIOD. The option
period shall commence on January 7, 1998 (the "Date of Grant") and shall
terminate four (4) years from the Date of Grant.
4. EXERCISE OF OPTION.
The Option may be exercised in whole or in part at any time after the date
hereof by delivering to the Chief Financial Officer of PRCC (a) a Notice and
Agreement of Exercise of Option, substantially in the form attached hereto as
Exhibit "A," specifying the number of Option Shares with respect to which the
Option is exercised, and (b) full payment of the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS.
The Option Shares have not been registered under the Securities Act of 1933, as
amended (the "Act"), and no Shares may be sold, offered for sale, transferred,
pledged, hypothecated or otherwise disposed of except in compliance with the
Act and any other applicable federal and state securities laws. Additionally,
the Option and the Option Shares have not been qualified under the California
Securities Law of 1968, as amended (the "California Law"). PRCC has no
obligation to register the Option shares under the Act or qualify the Option
Shares under the California Law. Optionee acknowledges that he is aware that
Rule 144 of the General Rules and Regulations under the Act ("Rule 144")
affords a limited exemption from registration for the public resale of
registered securities and under the terms of Rule 144 as currently in effect,
the Shares received by Optionee may be sold to the public without registration
only after a period of two (2) years has elapsed from the exercise date of the
Option and then only in compliance with all other requirements of Rule 144 and
the Act. Optionee hereby acknowledges, represents, warrants and agrees as
follows:
(a) That the Option and the Option
Shares are not registered under the Act or qualified under the California Law,
and the Option Shares shall be, acquired solely for the account of Optionee for
investment purposes only and with no view to their resale or other distribution
of any kind;
(b) Neither the Option nor any
Option Share shall be sold or otherwise distributed in violation of the Act,
the California Law or any other applicable federal or state securities law;
(c) His overall commitment to
investments that are not readily marketable is not disproportionate to his net
worth, and his investment in PRCC will not cause such overall commitment to
become excessive;
(d) He has the financial ability to
bear the economic risk of his investment, has adequate means of providing for
his current needs and personal contingencies, and has no need for liquidity in
his investment in PRCC;
(e) He either: (i) has a
preexisting personal or business relationship with PRCC or its officers,
directors or controlling persons, or (ii) has evaluated the business of PRCC
and the high risks of investing in PRCC, the competitive nature of the business
in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the
opportunity to review all books, records and documents of PRCC and to ask
questions and receive answers from PRCC concerning PRCC's business, to obtain
additional information necessary to verify the accuracy of the information he
has desired in order to evaluate his investment, and to consult with such
attorneys, accountants and other advisors as he has desired;
(g) His residence set forth below
is his true and correct residence, and he has no present intention of becoming
a resident or domiciliary of any other state of jurisdiction;
(h) In making the decision to
accept the Option and/or purchase the Option Shares, he has relied solely upon
independent investigations made by or on behalf of him;
(i) No federal or state agency has
made any finding or determination as to the fairness of an investment in PRCC;
and
(j) He understands that all the
representations and warranties made by him herein, and all information
furnished by him to PRCC, is true, correct and complete in all respects.
6. Optionee hereby acknowledges
that he understands the meaning and legal consequences of the representations,
warranties and covenants contained herein and that PRCC has relied on the
representations made by Optionee in paragraph 5 hereof in granting this Option,
and Optionee agrees to indemnify and hold harmless PRCC and its officers,
directors, controlling persons, attorneys, agents and employees from and
against any and all loss, damage or liability, together with all costs and
expenses (including attorneys' fees and disbursements) which any of them may
incur by reason of any breach and any representation, warranty, covenant or
agreement contained herein. All representations, warranties, covenants and
agreements, and the indemnification contained herein shall survive the grant of
the Option and the issuance of the Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All
Option Shares issued pursuant to this Agreement shall be subject to the
provisions of this Agreement and the certificates representing such Option
Shares shall bear the following legend or language substantially equivalent
thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED OR
QUALIFIED UNDER FEDERAL OR STATE
SECURITIES LAWS. THE SHARES MAY NOT BE
OFFERED FOR SALE, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS SO
REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS,
THE AVAILABILITY OF WHICH IS
TO BE ESTABLISHED TO THE
SATISFACTION OF THE COMPANY."
8. Transferability of Option.
The Option shall not be transferable except by the laws of descent and
distribution and any attempt to do so shall void the Option.
9. ADJUSTMENT. The Option
Price and the number and kind of Option Shares shall be subject to
corresponding adjustment in the event of any change in the Common stock by
reason of any reclassification, recapitalization, split- up, combination,
exchange of shares, readjustment or stock dividend, in like manner as if such
Option Shares had been issued and outstanding, fully paid and non-assessable at
the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP.
Optionee shall not have any of the rights of a shareholder with respect to the
shares covered by the Option except to the extent that one or more certificates
for such Shares shall be delivered to his upon one (1) or more exercises of the
Option.
11. NOTICES. Any notices
required or permitted to be given under this Agreement shall be in writing and
they shall be deemed to have been given upon personal delivery or two (2)
business days after mailing the notice by postage, registered or certified
mail. Such notice shall be addressed to the party to be notified as shown
below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Ron Logan-Sinclair
506 Paula Avenue
Glendale, Ca 91201
Any party may change its address for
purposes of this Section by giving the other party written notice of the new
address in the manner set forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement
between PRCC and Optionee regarding options of PRCC to Optionee and supersedes
all prior communications, oral or written;
(b) Shall not be construed to give
Optionee any rights as to PRCC or the Common Stock, except as specifically
provided herein;
(c) May not be amended nor may any
rights hereunder be waived except by an instrument in writing signed by the
party sought to be charged with such amendment or waiver;
(d) Shall be construed in
accordance with, and governed by, the laws of the State of California; and
(e) Shall be binding upon and shall
inure to the benefit of PRCC and Optionee, and their respective successors and
assigns, except that Optionee shall not have the right to assign or otherwise
transfer his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have
executed this Agreement as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ Albert E. Gosselin
-------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ Ron Logan-Sinclair
------------------------
Ron Logan-Sinclair
------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
________________ as to ________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
- ---------------------------- -----------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.118
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 123,000 SHARES OF COMMON STOCK OF POLLUTION RESEARCH AND
CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Albert E. Gosselin or registered assigns, is
entitled, subject to the terms set forth below, to purchase from Pollution
Research and Control Corp., a California corporation (the "Company"), the above
number of fully paid and nonassessable shares of Common Stock of the Company
("Common Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Albert E. Gosselin
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into effective as of June 1, 1996 by and between Pollution Research and
Control Corp., a California corporation ("PRCC") and Albert E. Gosselin
("Optionee").
WHEREAS, Optionee has been providing valuable services as
recognized by the Company's Board of Directors to PRCC and PRCC is desirous of
having Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 123,000 shares of the no par value common stock
of PRCC (the "Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as
a matter of separate agreement and not in lieu of other compensation for
services, the right and option (the "Option") to purchase on the terms and
conditions set forth in this Agreement all or any part of up to an aggregate of
123,000 shares of Common Stock (the "Option Shares"), for continuous,
uninterrupted, employment service to PRCC or by specific acknowledgement of
exception by the Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common
Stock are to be purchased pursuant to the Option, the purchase price for each
Option share shall be $1.10 (the ""Option Price"), and for purposes of record,
the bid price of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on
January 7, 1998 (the "Date of Grant") and shall terminate four (4) years from
the Date of Grant.
4. EXERCISE OF OPTION. The Option may be
exercised in whole or in part at any time after the date hereof by delivering
to the Chief Financial Officer of PRCC (a) a Notice and Agreement of Exercise
of Option, substantially in the form attached hereto as Exhibit "A," specifying
the number of Option Shares with respect to which the Option is exercised, and
(b) full payment of the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares
have not been registered under the Securities Act of 1933, as amended (the
"Act"), and no Shares may be sold, offered for sale, transferred, pledged,
hypothecated or otherwise disposed of except in compliance with the Act and any
other applicable federal and state securities laws. Additionally, the Option
and the Option Shares have not been qualified under the California Securities
Law of 1968, as amended (the "California Law"). PRCC has no obligation to
register the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall
be sold or otherwise distributed in violation of the Act, the California Law or
any other applicable federal or state securities law;
(c) His overall commitment to investments that
are not readily marketable is not disproportionate to his net worth, and his
investment in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the
economic risk of his investment, has adequate means of providing for his
current needs and personal contingencies, and has no need for liquidity in his
investment in PRCC;
(e) He either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review
all books, records and documents of PRCC and to ask questions and receive
answers from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and
correct residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option
and/or purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any
finding or determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations
and warranties made by him herein, and all information furnished by him to
PRCC, is true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the
meaning and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach
and any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued
pursuant to this Agreement shall be subject to the provisions of this Agreement
and the certificates representing such Option Shares shall bear the following
legend or language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall
not be transferable except by the laws of descent and distribution and any
attempt to do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and
kind of Option Shares shall be subject to corresponding adjustment in the event
of any change in the Common stock by reason of any reclassification,
recapitalization, split- up, combination, exchange of shares, readjustment or
stock dividend, in like manner as if such Option Shares had been issued and
outstanding, fully paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any
of the rights of a shareholder with respect to the shares covered by the Option
except to the extent that one or more certificates for such Shares shall be
delivered to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be
given under this Agreement shall be in writing and they shall be deemed to have
been given upon personal delivery or two (2) business days after mailing the
notice by postage, registered or certified mail. Such notice shall be
addressed to the party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Albert E. Gosselin
506 Paula Avenue
Glendale, Ca 91201
Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC
and Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any
rights as to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights
hereunder be waived except by an instrument in writing signed by the party
sought to be charged with such amendment or waiver;
(d) Shall be construed in accordance with, and
governed by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the
benefit of PRCC and Optionee, and their respective successors and assigns,
except that Optionee shall not have the right to assign or otherwise transfer
his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ Albert E. Gosselin
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ Albert E. Gosselin
-------------------------------------
Albert E. Gosselin
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
________________________________as to ____________________________________
shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
____________________________ ____________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.121
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Gary L. Dudley or registered assigns, is
entitled, subject to the terms set forth below, to purchase from Pollution
Research and Control Corp., a California corporation (the "Company"), the above
number of fully paid and nonassessable shares of Common Stock of the Company
("Common Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Gary L. Dudley
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into effective as of June 1, 1996 by and between Pollution Research and
Control Corp., a California corporation ("PRCC") and Gary L. Dudley
("Optionee").
WHEREAS, Optionee has been providing valuable services as
recognized by the Company's Board of Directors to PRCC and PRCC is desirous of
having Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 20,000 shares of the no par value common stock
of PRCC (the "Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as
a matter of separate agreement and not in lieu of other compensation for
services, the right and option (the "Option") to purchase on the terms and
conditions set forth in this Agreement all or any part of up to an aggregate of
20,000 shares of Common Stock (the "Option Shares"), for continuous,
uninterrupted, employment service to PRCC or by specific acknowledgement of
exception by the Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common
Stock are to be purchased pursuant to the Option, the purchase price for each
Option share shall be $1.10 (the ""Option Price"), and for purposes of record,
the bid price of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on
January 7, 1998 (the "Date of Grant") and shall terminate four (4) years from
the Date of Grant.
4. EXERCISE OF OPTION. The Option may be
exercised in whole or in part at any time after the date hereof by delivering
to the Chief Financial Officer of PRCC (a) a Notice and Agreement of Exercise
of Option, substantially in the form attached hereto as Exhibit "A," specifying
the number of Option Shares with respect to which the Option is exercised, and
(b) full payment of the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares
have not been registered under the Securities Act of 1933, as amended (the
"Act"), and no Shares may be sold, offered for sale, transferred, pledged,
hypothecated or otherwise disposed of except in compliance with the Act and any
other applicable federal and state securities laws. Additionally, the Option
and the Option Shares have not been qualified under the California Securities
Law of 1968, as amended (the "California Law"). PRCC has no obligation to
register the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall
be sold or otherwise distributed in violation of the Act, the California Law or
any other applicable federal or state securities law;
(c) His overall commitment to investments that
are not readily marketable is not disproportionate to his net worth, and his
investment in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the
economic risk of his investment, has adequate means of providing for his
current needs and personal contingencies, and has no need for liquidity in his
investment in PRCC;
(e) He either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review
all books, records and documents of PRCC and to ask questions and receive
answers from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and
correct residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option
and/or purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any
finding or determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations
and warranties made by him herein, and all information furnished by him to
PRCC, is true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the
meaning and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach
and any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued
pursuant to this Agreement shall be subject to the provisions of this Agreement
and the certificates representing such Option Shares shall bear the following
legend or language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall
not be transferable except by the laws of descent and distribution and any
attempt to do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and
kind of Option Shares shall be subject to corresponding adjustment in the event
of any change in the Common stock by reason of any reclassification,
recapitalization, split-up, combination, exchange of shares, readjustment or
stock dividend, in like manner as if such Option Shares had been issued and
outstanding, fully paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any
of the rights of a shareholder with respect to the shares covered by the Option
except to the extent that one or more certificates for such Shares shall be
delivered to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be
given under this Agreement shall be in writing and they shall be deemed to have
been given upon personal delivery or two (2) business days after mailing the
notice by postage, registered or certified mail. Such notice shall be
addressed to the party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Gary L. Dudley
506 Paula Avenue
Glendale, CA 91201
Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC
and Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any
rights as to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights
hereunder be waived except by an instrument in writing signed by the party
sought to be charged with such amendment or waiver;
(d) Shall be construed in accordance with, and
governed by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the
benefit of PRCC and Optionee, and their respective successors and assigns,
except that Optionee shall not have the right to assign or otherwise transfer
his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN
-------------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ GARY L. DUDLEY
-------------------------------------
Gary L. Dudley
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
________________________________as to ____________________________________
shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
____________________________ ____________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.123
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Craig E. Gosselin or registered assigns, is
entitled, subject to the terms set forth below, to purchase from Pollution
Research and Control Corp., a California corporation (the "Company"), the above
number of fully paid and nonassessable shares of Common Stock of the Company
("Common Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Craig E. Gosselin
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into effective as of June 1, 1996 by and between Pollution Research and
Control Corp., a California corporation ("PRCC") and Craig E. Gosselin
("Optionee").
WHEREAS, Optionee has been providing valuable services as
recognized by the Company's Board of Directors to PRCC and PRCC is desirous of
having Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 20,000 shares of the no par value common stock
of PRCC (the "Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as
a matter of separate agreement and not in lieu of other compensation for
services, the right and option (the "Option") to purchase on the terms and
conditions set forth in this Agreement all or any part of up to an aggregate of
20,000 shares of Common Stock (the "Option Shares"), for continuous,
uninterrupted, employment service to PRCC or by specific acknowledgement of
exception by the Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common
Stock are to be purchased pursuant to the Option, the purchase price for each
Option share shall be $1.10 (the ""Option Price"), and for purposes of record,
the bid price of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on
January 7, 1998 (the "Date of Grant") and shall terminate four (4) years from
the Date of Grant.
4. EXERCISE OF OPTION. The Option may be
exercised in whole or in part at any time after the date hereof by delivering
to the Chief Financial Officer of PRCC (a) a Notice and Agreement of Exercise
of Option, substantially in the form attached hereto as Exhibit "A," specifying
the number of Option Shares with respect to which the Option is exercised, and
(b) full payment of the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares
have not been registered under the Securities Act of 1933, as amended (the
"Act"), and no Shares may be sold, offered for sale, transferred, pledged,
hypothecated or otherwise disposed of except in compliance with the Act and any
other applicable federal and state securities laws. Additionally, the Option
and the Option Shares have not been qualified under the California Securities
Law of 1968, as amended (the "California Law"). PRCC has no obligation to
register the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall
be sold or otherwise distributed in violation of the Act, the California Law or
any other applicable federal or state securities law;
(c) His overall commitment to investments that
are not readily marketable is not disproportionate to his net worth, and his
investment in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the
economic risk of his investment, has adequate means of providing for his
current needs and personal contingencies, and has no need for liquidity in his
investment in PRCC;
(e) He either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review
all books, records and documents of PRCC and to ask questions and receive
answers from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and
correct residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option
and/or purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any
finding or determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations
and warranties made by him herein, and all information furnished by him to
PRCC, is true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the
meaning and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach
and any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued
pursuant to this Agreement shall be subject to the provisions of this Agreement
and the certificates representing such Option Shares shall bear the following
legend or language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and
kind of Option Shares shall be subject to corresponding adjustment in the event
of any change in the Common stock by reason of any reclassification,
recapitalization, split-up, combination, exchange of shares, readjustment or
stock dividend, in like manner as if such Option Shares had been issued and
outstanding, fully paid and non- assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any
of the rights of a shareholder with respect to the shares covered by the Option
except to the extent that one or more certificates for such Shares shall be
delivered to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be
given under this Agreement shall be in writing and they shall be deemed to have
been given upon personal delivery or two (2) business days after mailing the
notice by postage, registered or certified mail. Such notice shall be
addressed to the party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Craig E. Gosselin
506 Paula Avenue
Glendale, Ca 91201
Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC
and Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any
rights as to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights
hereunder be waived except by an instrument in writing signed by the party
sought to be charged with such amendment or waiver;
(d) Shall be construed in accordance with, and
governed by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the
benefit of PRCC and Optionee, and their respective successors and assigns,
except that Optionee shall not have the right to assign or otherwise transfer
his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN
-------------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ CRAIG E. GOSSELIN
-------------------------------------
Craig E. Gosselin
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
________________________________as to ____________________________________
shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
______________________________ ______________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.125
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Cynthia L. Gosselin or registered assigns, is
entitled, subject to the terms set forth below, to purchase from Pollution
Research and Control Corp., a California corporation (the "Company"), the above
number of fully paid and nonassessable shares of Common Stock of the Company
("Common Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Cynthia L. Gosselin
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into effective as of June 1, 1996 by and between Pollution Research and
Control Corp., a California corporation ("PRCC") and Cynthia L. Gosselin
("Optionee").
WHEREAS, Optionee has been providing valuable services as
recognized by the Company's Board of Directors to PRCC and PRCC is desirous of
having Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 20,000 shares of the no par value common stock
of PRCC (the "Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as
a matter of separate agreement and not in lieu of other compensation for
services, the right and option (the "Option") to purchase on the terms and
conditions set forth in this Agreement all or any part of up to an aggregate of
20,000 shares of Common Stock (the "Option Shares"), for continuous,
uninterrupted, employment service to PRCC or by specific acknowledgement of
exception by the Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common
Stock are to be purchased pursuant to the Option, the purchase price for each
Option share shall be $1.10 (the ""Option Price"), and for purposes of record,
the bid price of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on
January 7, 1998 (the "Date of Grant") and shall terminate four (4) years from
the Date of Grant.
4. EXERCISE OF OPTION. The Option may be
exercised in whole or in part at any time after the date hereof by delivering
to the Chief Financial Officer of PRCC (a) a Notice and Agreement of Exercise
of Option, substantially in the form attached hereto as Exhibit "A," specifying
the number of Option Shares with respect to which the Option is exercised, and
(b) full payment of the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares
have not been registered under the Securities Act of 1933, as amended (the
"Act"), and no Shares may be sold, offered for sale, transferred, pledged,
hypothecated or otherwise disposed of except in compliance with the Act and any
other applicable federal and state securities laws. Additionally, the Option
and the Option Shares have not been qualified under the California Securities
Law of 1968, as amended (the "California Law"). PRCC has no obligation to
register the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall
be sold or otherwise distributed in violation of the Act, the California Law or
any other applicable federal or state securities law;
(c) Her overall commitment to investments that
are not readily marketable is not disproportionate to her net worth, and her
investment in PRCC will not cause such overall commitment to become excessive;
(d) She has the financial ability to bear the
economic risk of her investment, has adequate means of providing for her
current needs and personal contingencies, and has no need for liquidity in her
investment in PRCC;
(e) She either: (i) has a preexisting personal
or business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
her interests in connection with the transaction;
(f) She has been given the opportunity to review
all books, records and documents of PRCC and to ask questions and receive
answers from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information she has desired in order to
evaluate her investment, and to consult with such attorneys, accountants and
other advisors as she has desired;
(g) Her residence set forth below is her true and
correct residence, and she has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option
and/or purchase the Option Shares, she has relied solely upon independent
investigations made by or on behalf of her;
(i) No federal or state agency has made any
finding or determination as to the fairness of an investment in PRCC; and
(j) She understands that all the representations
and warranties made by her herein, and all information furnished by her to
PRCC, is true, correct and complete in all respects.
6. Optionee hereby acknowledges that she understands the
meaning and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach
and any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued
pursuant to this Agreement shall be subject to the provisions of this Agreement
and the certificates representing such Option Shares shall bear the following
legend or language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall
not be transferable except by the laws of descent and distribution and any
attempt to do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and
kind of Option Shares shall be subject to corresponding adjustment in the event
of any change in the Common stock by reason of any reclassification,
recapitalization, split-up, combination, exchange of shares, readjustment or
stock dividend, in like manner as if such Option Shares had been issued and
outstanding, fully paid and non- assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any
of the rights of a shareholder with respect to the shares covered by the Option
except to the extent that one or more certificates for such Shares shall be
delivered to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be
given under this Agreement shall be in writing and they shall be deemed to have
been given upon personal delivery or two (2) business days after mailing the
notice by postage, registered or certified mail. Such notice shall be
addressed to the party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Cynthia L. Gosselin
506 Paula Avenue
Glendale, Ca 91201
Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC
and Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any
rights as to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights
hereunder be waived except by an instrument in writing signed by the party
sought to be charged with such amendment or waiver;
(d) Shall be construed in accordance with, and
governed by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the
benefit of PRCC and Optionee, and their respective successors and assigns,
except that Optionee shall not have the right to assign or otherwise transfer
his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN
-------------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ CYNTHIA L. GOSSELIN
-------------------------------------
Cynthia L. Gosselin
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
________________________________as to ____________________________________
shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
______________________________ ______________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.127
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Marcia Smith or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Marcia Smith
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into effective as of June 1, 1996 by and between Pollution Research and
Control Corp., a California corporation ("PRCC") and Marcia Smith
("Optionee").
WHEREAS, Optionee has been providing valuable services as
recognized by the Company's Board of Directors to PRCC and PRCC is desirous of
having Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 20,000 shares of the no par value common stock
of PRCC (the "Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as
a matter of separate agreement and not in lieu of other compensation for
services, the right and option (the "Option") to purchase on the terms and
conditions set forth in this Agreement all or any part of up to an aggregate of
20,000 shares of Common Stock (the "Option Shares"), for continuous,
uninterrupted, employment service to PRCC or by specific acknowledgement of
exception by the Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common
Stock are to be purchased pursuant to the Option, the purchase price for each
Option share shall be $1.10 (the ""Option Price"), and for purposes of record,
the bid price of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on
January 7, 1998 (the "Date of Grant") and shall terminate four (4) years from
the Date of Grant.
4. EXERCISE OF OPTION. The Option may be
exercised in whole or in part at any time after the date hereof by delivering
to the Chief Financial Officer of PRCC (a) a Notice and Agreement of Exercise
of Option, substantially in the form attached hereto as Exhibit "A," specifying
the number of Option Shares with respect to which the Option is exercised, and
(b) full payment of the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares
have not been registered under the Securities Act of 1933, as amended (the
"Act"), and no Shares may be sold, offered for sale, transferred, pledged,
hypothecated or otherwise disposed of except in compliance with the Act and any
other applicable federal and state securities laws. Additionally, the Option
and the Option Shares have not been qualified under the California Securities
Law of 1968, as amended (the "California Law"). PRCC has no obligation to
register the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall
be sold or otherwise distributed in violation of the Act, the California Law or
any other applicable federal or state securities law;
(c) Her overall commitment to investments that
are not readily marketable is not disproportionate to her net worth, and her
investment in PRCC will not cause such overall commitment to become excessive;
(d) She has the financial ability to bear the
economic risk of her investment, has adequate means of providing for her
current needs and personal contingencies, and has no need for liquidity in her
investment in PRCC;
(e) She either: (i) has a preexisting personal
or business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
her interests in connection with the transaction;
(f) She has been given the opportunity to review
all books, records and documents of PRCC and to ask questions and receive
answers from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information she has desired in order to
evaluate her investment, and to consult with such attorneys, accountants and
other advisors as she has desired;
(g) Her residence set forth below is her true and
correct residence, and she has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option
and/or purchase the Option Shares, she has relied solely upon independent
investigations made by or on behalf of her;
(i) No federal or state agency has made any
finding or determination as to the fairness of an investment in PRCC; and
(j) She understands that all the representations
and warranties made by her herein, and all information furnished by her to
PRCC, is true, correct and complete in all respects.
6. Optionee hereby acknowledges that she understands the
meaning and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach
and any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued
pursuant to this Agreement shall be subject to the provisions of this Agreement
and the certificates representing such Option Shares shall bear the following
legend or language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall
not be transferable except by the laws of descent and distribution and any
attempt to do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and
kind of Option Shares shall be subject to corresponding adjustment in the event
of any change in the Common stock by reason of any reclassification,
recapitalization, split-up, combination, exchange of shares, readjustment or
stock dividend, in like manner as if such Option Shares had been issued and
outstanding, fully paid and non- assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any
of the rights of a shareholder with respect to the shares covered by the Option
except to the extent that one or more certificates for such Shares shall be
delivered to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be
given under this Agreement shall be in writing and they shall be deemed to have
been given upon personal delivery or two (2) business days after mailing the
notice by postage, registered or certified mail. Such notice shall be
addressed to the party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Marcia Smith
506 Paula Avenue
Glendale, Ca 91201
Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC
and Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any
rights as to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights
hereunder be waived except by an instrument in writing signed by the party
sought to be charged with such amendment or waiver;
(d) Shall be construed in accordance with, and
governed by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the
benefit of PRCC and Optionee, and their respective successors and assigns,
except that Optionee shall not have the right to assign or otherwise transfer
his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ Albert E. Gosselin Albert E. Gosselin,
Jr., President and Chief Executive Officer
OPTIONEE:
/s/ Marcia Smith
Marcia Smith
______________________________________
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
________________________________as to ____________________________________
shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
_____________________________ _____________________________
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.129
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Keith Gosselin or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Margaret Jones
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of June 1, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Keith Gosselin ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 20,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 20,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid
price of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic risk
of his investment, has adequate means of providing for his current needs and
personal contingencies, and has no need for liquidity in his investment in PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and
correct residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to him upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Margaret Jones
506 Paula Avenue
Glendale, Ca 91201
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
--------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ MARGARET JONES
----------------------------------
Margaret Jones
----------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of_______________ as
to ________________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- ---------------------------------- ----------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.130
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 37,500 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Lee Sion or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Lee Sion
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of June 1, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Lee Sion ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 37,500 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 37,500 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted, employment
service to PRCC or by specific acknowledgement of exception by the Company's
Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option shares
shall be $1.10 (the "Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register the
Option shares under the Act or qualify the Option Shares under the California
Law. Optionee acknowledges that he is aware that Rule 144 of the General Rules
and Regulations under the Act ("Rule 144") affords a limited exemption from
registration for the public resale of registered securities and under the terms
of Rule 144 as currently in effect, the Shares received by Optionee may be sold
to the public without registration only after a period of two (2) years has
elapsed from the exercise date of the Option and then only in compliance with
all other requirements of Rule 144 and the Act. Optionee hereby acknowledges,
represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC,
is true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Lee Sion
506 Paula Avenue
Glendale, Ca 91201
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
---------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
-------------------------------------
Lee Sion
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of __________ as
to ________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- --------------------------------- -----------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.131
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE, UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Patricia Cudd or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Patricia Cudd
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of June 1, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Patricia Cudd ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 20,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 20,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the "Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) Her overall commitment to investments that are not
readily marketable is not disproportionate to her net worth, and her investment
in PRCC will not cause such overall commitment to become excessive;
(d) She has the financial ability to bear the economic
risk of her investment, has adequate means of providing for her current needs
and personal contingencies, and has no need for liquidity in her investment in
PRCC;
(e) She either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
her interests in connection with the transaction;
(f) She has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information she has desired in order to
evaluate her investment, and to consult with such attorneys, accountants and
other advisors as she has desired;
(g) Her residence set forth below is her true and correct
residence, and she has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, she has relied solely upon independent
investigations made by or on behalf of her;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) She understands that all the representations and
warranties made by her herein, and all information furnished by her to PRCC,
is true, correct and complete in all respects.
6. Optionee hereby acknowledges that she understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Patricia Cudd
50 S. Steele St.
Suite 222
Denver, Co 80200
Any party may change its address for purposes of this Section by
giving the other party
5
<PAGE> 6
written notice of the new address in the manner set forth above.
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
---------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ PATRICIA CUDD
-------------------------------------
Patricia Cudd
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of ________ as to
________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- --------------------------------- -----------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.132
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR
QUALIFIED UNDER APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION OR QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 20,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Roland Fink or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Roland Fink
Purchase Price: $1.10 per share
1
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into
effective as of June 1, 1996 by and between Pollution Research and Control
Corp., a California corporation ("PRCC") and Roland Fink ("Optionee").
WHEREAS, Optionee has been providing valuable services as recognized
by the Company's Board of Directors to PRCC and PRCC is desirous of having
Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to purchase up to
an aggregate of 20,000 shares of the no par value common stock of PRCC (the
"Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a matter
of separate agreement and not in lieu of other compensation for services, the
right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 20,000 shares
of Common Stock (the "Option Shares"), for continuous, uninterrupted,
employment service to PRCC or by specific acknowledgement of exception by the
Company's Board of Directors.
2. OPTION PRICE. At any time when shares of Common Stock are to
be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $.94 cents.
3. OPTION PERIOD. The option period shall commence on January 7,
1998 (the "Date of Grant") and shall terminate four (4) years from the Date of
Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time after the date hereof by delivering to the Chief Financial
Officer of PRCC (a) a Notice and Agreement of Exercise of Option, substantially
in the form attached hereto as Exhibit "A," specifying the number of Option
Shares with respect to which the Option is exercised, and (b) full payment of
the Option Price for such Shares.
2
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Securities Law of
1968, as amended (the "California Law"). PRCC has no obligation to register
the Option shares under the Act or qualify the Option Shares under the
California Law. Optionee acknowledges that he is aware that Rule 144 of the
General Rules and Regulations under the Act ("Rule 144") affords a limited
exemption from registration for the public resale of registered securities and
under the terms of Rule 144 as currently in effect, the Shares received by
Optionee may be sold to the public without registration only after a period of
two (2) years has elapsed from the exercise date of the Option and then only in
compliance with all other requirements of Rule 144 and the Act. Optionee
hereby acknowledges, represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be sold
or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are not
readily marketable is not disproportionate to his net worth, and his investment
in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or business
relationship with PRCC or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in
PRCC, the competitive nature of the business in which PRCC is engaged,
3
<PAGE> 4
and has the business or financial experience or has business or financial
advisors who are unaffiliated with, and not compensated by, PRCC and protect
his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information he has desired in order to
evaluate his investment, and to consult with such attorneys, accountants and
other advisors as he has desired;
(g) His residence set forth below is his true and correct
residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option and/or
purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding or
determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC,
is true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the meaning
and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant to
this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
4
<PAGE> 5
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
SO REGISTERED OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully
paid and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given under
this Agreement shall be in writing and they shall be deemed to have been given
upon personal delivery or two (2) business days after mailing the notice by
postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Roland Fink
506 Paula Avenue
Glendale, Ca 91201
Any party may change its address for purposes of this Section by
giving the other party written notice of the new address in the manner set
forth above.
5
<PAGE> 6
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any rights as
to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and governed
by, the laws of the State of California; and
(e) Shall be binding upon and shall inure to the benefit
of PRCC and Optionee, and their respective successors and assigns, except that
Optionee shall not have the right to assign or otherwise transfer his rights
hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ ALBERT E. GOSSELIN, JR.
---------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ ROLAND FINK
-------------------------------------
Roland Fink
-------------------------------------
6
<PAGE> 7
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION RESEARCH AND
CONTROL CORP., a California corporation ("PRCC"), dated as of __________ as to
__________ shares of PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph 4 of my
Agreement regarding the Option.
- --------------------------------- -----------------------------
(Print Your Name) Signature
7
<PAGE> 1
EXHIBIT 10.145
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED UNDER
THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR QUALIFIED UNDER
APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION OR
QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 40,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JANUARY 7, 1998
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON JANUARY 6, 2002
This certifies that Paul Richardson or registered assigns, is entitled,
subject to the terms set forth below, to purchase from Pollution Research and
Control Corp., a California corporation (the "Company"), the above number of
fully paid and nonassessable shares of Common Stock of the Company ("Common
Stock") at a purchase price of $1.10 per share ("Purchase Price").
This Option is exercisable from January 7, 1998 to and including 5:00
p.m., Los Angeles time, on January 6, 2002.
Registered Owner: Paul Richardson
Purchase Price: $ 1.10 per Share
<PAGE> 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into effective as of August 6, 1996 by and between Pollution Research and
Control Corp., a California corporation ("PRCC") and Paul Richardson
("Optionee").
WHEREAS, Optionee has been providing valuable services as
recognized by the Company's Board of Directors to PRCC and PRCC is desirous of
having Optionee continue to provide such services to it; and
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 40,000 shares of the no par value common stock of
PRCC (the "Common Stock") under the terms and conditions set forth below.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, as a
matter of separate agreement and not in lieu of other compensation for services,
the right and option (the "Option") to purchase on the terms and conditions set
forth in this Agreement all or any part of up to an aggregate of 20,000 shares
of Common Stock (the "Option Shares").
2. OPTION PRICE. At any time when shares of Common Stock are
to be purchased pursuant to the Option, the purchase price for each Option share
shall be $1.10 (the "Option Price"), and for purposes of record, the bid market
price on this date is .94 cents.
3. OPTION PERIOD. The option period shall commence on January
7, 1998 (the "Date of Grant") and shall terminate four (4) years from the Date
of Grant.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time by delivering to the Chief Financial Officer of PRCC (a) a
Notice and Agreement of Exercise of Option, substantially in the form attached
hereto as Exhibit "A," specifying the number of Option Shares with respect to
which the Option is exercised, and (b) full payment of the Option Price for such
Shares.
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not
been registered under the Securities Act of 1933, as amended (the "Act"), and no
Shares may be sold, offered for sale, transferred, pledged, hypothecated or
otherwise disposed of except in compliance with the Act and any other applicable
federal and state securities laws. Additionally, the Option and the Option
Shares have not been qualified under the California Securities Law of 1968, as
amended (the "California Law"). PRCC has no obligation to register the Option
shares under the Act or qualify the Option Shares under the California Law.
Optionee acknowledges that he is aware that Rule 144 of the General Rules and
Regulations under the Act ("Rule 144") affords a limited exemption from
registration for the public resale of registered securities and under the terms
of Rule 144 as currently in effect, the Shares received by Optionee may be sold
to the public without registration only after a period of two (2) years has
elapsed from the exercise date of the Option and then only in compliance with
all other requirements of Rule 144 and the Act. Optionee hereby acknowledges,
represents, warrants and agrees as follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be, acquired solely for the account
<PAGE> 3
of Optionee for investment purposes only and with no view to their resale or
other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be
sold or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) His overall commitment to investments that are
not readily marketable is not disproportionate to his net worth, and his
investment in PRCC will not cause such overall commitment to become excessive;
(d) He has the financial ability to bear the economic
risk of his investment, has adequate means of providing for his current needs
and personal contingencies, and has no need for liquidity in his investment in
PRCC;
(e) He either: (i) has a preexisting personal or
business relationship with PRCC or its officers, directors or controlling
persons, or (ii) has evaluated the business of PRCC and the high risks of
investing in PRCC, the competitive nature of the business in which PRCC is
engaged, and has the business or financial experience or has business or
financial advisors who are unaffiliated with, and not compensated by, PRCC and
protect his interests in connection with the transaction;
(f) He has been given the opportunity to review all
books, records and documents of PRCC and to ask questions and receive answers
from PRCC concerning PRCC's business, to obtain additional information necessary
to verify the accuracy of the information he has desired in order to evaluate
his investment, and to consult with such attorneys, accountants and other
advisors as he has desired;
(g) His residence set forth below is his true and
correct residence, and he has no present intention of becoming a resident or
domiciliary of any other state of jurisdiction;
(h) In making the decision to accept the Option
and/or purchase the Option Shares, he has relied solely upon independent
investigations made by or on behalf of him;
(i) No federal or state agency has made any finding
or determination as to the fairness of an investment in PRCC; and
(j) He understands that all the representations and
warranties made by him herein, and all information furnished by him to PRCC, is
true, correct and complete in all respects.
6. Optionee hereby acknowledges that he understands the
meaning and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued pursuant
to this Agreement shall be subject to the provisions of this Agreement and the
certificates representing such Option Shares shall bear the following legend or
language substantially equivalent thereto:
<PAGE> 4
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. Transferability of Option. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully paid
and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Shares shall be delivered
to his upon one (1) or more exercises of the Option.
11. NOTICES. Any notices required or permitted to be given
under this Agreement shall be in writing and they shall be deemed to have been
given upon personal delivery or two (2) business days after mailing the notice
by postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Paul Richardson
225 Brent Lane
Pensacola, Fl 32503
Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.
12. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC to Optionee and supersedes all prior
communications, oral or written;
(b) Shall not be construed to give Optionee any
rights as to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder
be waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and
governed by, the laws of the State of California; and
<PAGE> 5
(e) Shall be binding upon and shall inure to the
benefit of PRCC and Optionee, and their respective successors and assigns,
except that Optionee shall not have the right to assign or otherwise transfer
his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ Albert E. Gosselin, Jr.
-----------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/Paul Richardson
--------------------------------------
<PAGE> 6
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
_______________________________ as to _______________ shares of PRCC's no par
value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
- ----------------------------- -----------------------------
(Print Your Name) Signature
<PAGE> 1
EXHIBIT 10.147
CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement") is made and entered into
this 19th day of November, 1996, by and between Fenway Advisory Group (the
"Consultant") and Pollution Research and Control Corp., a California corporation
(the "Client").
WHEREAS:
1. The Consultant is willing and capable of providing on a "best
efforts" basis various consulting services to the Client including, but not
limited to, the identification and evaluation of potential sources of financing
and possible merger and/or acquisition candidates.
2. The Client desires to retain the Consultant as an independent
consultant and the Consultant desires to be retained in that capacity upon the
terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises and agreements
hereinafter set forth, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Consulting Services. The Client hereby retains the Consultant as an
independent consultant to the Client and the Consultant hereby accepts and
agrees to such retention. The Consultant shall render to the Client such
services of an advisory or consultative nature in order to identify and evaluate
potential sources of financing and possible merger and/or acquisition candidates
for the Client. Performance of the consulting services described herein shall be
accomplished exclusively by the Consultant. The Client agrees to inform the
Consultant of any financing or merger and/or acquisition transactions which it
intends to pursue.
2. Time, Place and Manner of Performance. The Consultant shall be
available for advice and counsel to the officers and directors of the Client at
such reasonable and convenient times and places as may be mutually agreed upon.
Except as aforesaid, the time, place and manner of performance of the services
hereunder, including the amount of time to be allocated by the Consultant to any
specific service, shall be determined in the sole discretion of the Consultant.
The Client acknowledges and understands that neither the Consultant nor its
representatives shall participate in any negotiations between the Client and any
financing, merger and/or acquisition candidate.
3. Term of Agreement. The term of this Agreement shall be a period of
twelve (12) months, commencing November 5, 1996, and terminating November 4,
1997.
<PAGE> 2
4. Compensation. In consideration of the services to be provided for
the Client by the Consultant, the Client hereby agrees to compensate the
Consultant as follows:
a. Upon execution of this Agreement, the Client agrees to
issue to the Consultant non-qualified stock options exercisable to purchase an
aggregate of 400,000 shares of the no par value common stock (the "Common
Stock") of the Client at an exercise price of $1.12 per share at any time during
the period commencing June 4, 1997 through November 4, 1999.
b. In the event, during the period commencing on the date
hereof and expiring two years from the last date of the issuance of any shares
of the Client's Common Stock upon the exercise by the Consultant of any of the
stock options issued pursuant to this Agreement (the "Option Stock"), the
Company shall register any primary or secondary offering of any debt or equity
security issued or to be issued by it pursuant to a registration statement under
the Securities Act of 1933, as amended, pursuant to which the Option Stock can
be registered., the Company shall in each such event notify the Consultant in
writing not less than thirty (30) days prior to filing such registration
statement with the Commission, and the Consultant shall have the right to
register all of the Option Shares therewith by notifying the Company in writing,
within fifteen (15) days of receipt of the Company's notice, requesting
registration of the Option Shares and setting forth the intended method of
distribution and such other data or information as the Company or its counsel
reasonably shall require. Such registration shall be without cost to the
Consultant except for sales commissions and related fees and/or transfer taxes
incurred if the Option Shares are subsequently sold.
5. Expenses. The Client shall reimburse the Consultant for all expenses
and other disbursements incurred by the Consultant on behalf of the Client in
the amount of $2,500.00 per month in connection with the performance of the
consulting services pursuant to this Agreement. This $2,500.00 sum shall be
payable quarterly on February 4, May 4, August 4 and November 4, 1997.
6. Disclosure of Information. The Consultant recognizes and
acknowledges that it has and will have access to certain confidential
information of the Client and its affiliates that are valuable, special and
unique assets and property of the Client and such affiliates. The Consultant
will not, during or after the term of this Agreement, disclose, without the
prior written consent or authorization of the Client, any of such information to
any person, except to authorized representatives of the Consultant or its
affiliates, for any reason or purpose whatsoever. In this regard, the Client
agrees that such authorization or consent to disclosure may be conditioned upon
the disclosure being made pursuant to a secrecy agreement, protective order,
provision of statute, rule, regulation or procedure under which the
confidentiality of the information is maintained in the hands of the person to
whom the information is to be disclosed or in compliance with the terms of a
judicial order or administrative process.
7. Nature of Relationship. It is understood and acknowledged by the
parties that the Consultant is being retained by the Client in an independent
capacity and that, in this connection, the Consultant hereby agrees, except as
provided in paragraph 4. hereinabove or unless the Client shall
<PAGE> 3
have otherwise consented in writing, not to enter into any agreement or incur
any obligation on behalf of the Client.
8. Conflict of Interest. The Consultant shall be free to perform
services for other persons. The Consultant will notify the Company if its
performance of consulting services for any other person could conflict with its
obligations under this Agreement. Upon receiving such notice, the Client may
terminate this Agreement or consent to the Consultant's outside consulting
activities; failure to terminate this Agreement shall constitute the Client's
ongoing consent to the Consultant's outside consulting activities.
9. Notices. Any notices required or permitted to be given under this
Agreement shall be sufficient if in writing and delivered or sent by registered
or certified mail to the principal office of each party.
10. Waiver of Breach. Any waiver by the Consultant of a breach of any
provision of this Agreement by the Client shall not operate or be construed as a
waiver of any subsequent breach by the Client.
11. Assignment. This Agreement and the rights and obligations of the
parties hereunder shall inure to the benefit of and shall be binding upon their
successors and assigns.
12. Applicable Law. It is the intention of the parties hereto that this
Agreement and the performance hereunder and all suits and special proceedings
hereunder be construed in accordance with and under and pursuant to the laws of
the State of California and that in any action, special proceeding or other
proceeding that may be brought arising out of, in connection with or by reason
of this Agreement, the laws of the State of California shall be applicable and
shall govern to the exclusion of the law of any other forum, without regard to
the jurisdiction in which any action or special proceeding may be instituted.
13. Severability. All agreements and covenants contained herein are
severable, and in the event any of them shall be held to be invalid by any
competent court, this Agreement shall be interpreted as if such invalid
agreements or covenants were not contained herein.
14. Entire Agreement. This Agreement constitutes and embodies the
entire understanding and agreement of the parties and supersedes and replaces
all prior understandings, agreements and negotiations between the parties.
15. Waiver and Modification. Any waiver, alteration or modification of
any of the provisions of this Agreement shall be valid only if made in writing
and signed by the parties hereto. Each party hereto, from time to time, may
waive any of its rights hereunder without effecting a waiver with respect to any
subsequent occurrences or transactions hereof.
<PAGE> 4
16. Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original but both of which taken together shall
constitute but one and the same document.
IN WITNESS WHEREOF, the parties here to have duly executed and
delivered this Agreement as of the day and year first above written.
CONSULTANT: CLIENT:
FENWAY ADVISORY GROUP POLLUTION RESEARCH AND
CONTROL CORP.
By: /s/ Neil C. Sullivan By: /s/ Albert E. Gosselin, Jr.
------------------------------- ---------------------------------
Neil C. Sullivan, President Albert E. Gosselin, Jr.,
President
<PAGE> 1
EXHIBIT 10.148
THE OPTION REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THE OPTION HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED UNDER
THE SECURITIES LAWS OF ANY STATE AND THUS MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED UNLESS REGISTERED UNDER THAT ACT AND REGISTERED OR QUALIFIED UNDER
APPLICABLE SECURITIES LAW OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION OR
QUALIFICATION IS AVAILABLE.
OPTION TO PURCHASE 400,000 SHARES OF COMMON STOCK OF
POLLUTION RESEARCH AND CONTROL CORP.
FROM JUNE 4, 1997
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON NOVEMBER 4, 1999
This certifies that Fenway Advisory Group, or registered assigns, is
entitled, subject to the terms set forth below, to purchase from Pollution
Research and Control Corp., a California corporation (the "Company"), the above
number of fully paid and nonassessable shares of Common Stock of the Company
("Common Stock") at a purchase price of $1.12 per share ("Purchase Price").
This Option is exercisable from June 4, 1997 to and including 5:00
p.m., Los Angeles time, on November 4, 1999.
Registered Owner: Fenway Advisory Group
Purchase Price: $1.12 per share
<PAGE> 2
OPTION AGREEMENT
WHEREAS, PRCC desires to provide Optionee an opportunity to
purchase shares of its common stock, no par value (the "Common Stock"), as
hereinafter provided, in order to carry out the purpose of that certain
Consulting Agreement (the "Consulting Agreement") dated November 19, 1996,
between PRCC and Optionee, a copy of which is attached hereto and incorporated
herein.
WHEREAS, PRCC is willing to grant Optionee an option to
purchase up to an aggregate of 400,000 shares of the no par value common stock
(the "Common Stock") of PRCC under the terms and conditions set forth below and
in the Consulting Agreement.
NOW, THEREFORE, the parties agree as follows:
1. GRANT OF OPTION. PRCC hereby grants to Optionee, pursuant
to the Consulting Agreement, the right and option (the "Option") to purchase on
the terms and conditions set forth herein and in the Consulting Agreement all or
any part of up to an aggregate of 400,000 shares of Common Stock (the "Option
Shares").
2. OPTION PRICE. At any time when shares of Common Stock are
to be purchased pursuant to the Option, the purchase price for each Option Share
shall be $1.12 (the ""Option Price"), and for purposes of record, the bid price
of the Company's stock on this date was $1.00.
3. OPTION PERIOD. The option period (the "Option Period")
shall commence on June 4, 1997 (the "Date of Grant") and shall terminate at 5:00
p.m., Los Angeles time, on November 4, 1997.
4. EXERCISE OF OPTION. The Option may be exercised in whole or
in part at any time during the Option Period by delivering to the Chief
Financial Officer of PRCC (a) a Notice and Agreement of Exercise of Option,
substantially in the form attached hereto as Exhibit "A," specifying the number
of Option Shares with respect to which the Option is exercised, and (b) full
payment of the Option Price for such Shares.
<PAGE> 3
5. SECURITIES LAWS REQUIREMENTS. The Option Shares have not
been registered under the Securities Act of 1933, as amended (the "Act"), and no
Option Shares may be sold, offered for sale, transferred, pledged, hypothecated
or otherwise disposed of except in compliance with the Act and any other
applicable federal and state securities laws. Additionally, the Option and the
Option Shares have not been qualified under the California Corporate Securities
Law of 1968, as amended (the "California Law"). Except as provided in Section
11. below, PRCC has no obligation to register the Option Shares under the Act or
qualify the Option Shares under the California Law. Optionee acknowledges that
it is aware that Rule 144 of the General Rules and Regulations under the Act
("Rule 144") affords a limited exemption from registration for the public resale
of registered securities and under the terms of Rule 144 as currently in effect,
the Shares received by Optionee may be sold to the public without registration
only after a period of two (2) years has elapsed from the exercise date of the
Option and then only in compliance with all other requirements of Rule 144 and
the Act. Optionee hereby acknowledges, represents, warrants and agrees as
follows:
(a) That the Option and the Option Shares are not
registered under the Act or qualified under the California Law, and the Option
Shares shall be acquired solely for the account of Optionee for investment
purposes only and with no view to their resale or other distribution of any
kind;
(b) Neither the Option nor any Option Share shall be
sold or otherwise distributed in violation of the Act, the California Law or any
other applicable federal or state securities law;
(c) Its overall commitment to investments that are
not readily marketable is not disproportionate to its net worth, and its
investment in PRCC will not cause such overall commitment to become excessive;
(d) It has the financial ability to bear the economic
risk of its investment, has adequate means of providing for its current needs
and contingencies, and has no need for liquidity in its investment in PRCC;
(e) Optionee, or its officers, directors of
controlling persons either: (i) has a preexisting personal or business
relationship with PRCC, or its officers, directors or controlling persons, or
(ii) has evaluated the business of PRCC and the high risks of investing in PRCC,
the
<PAGE> 4
competitive nature of the business in which PRCC is engaged, and has the
business or financial experience or has business or financial advisors who are
unaffiliated with, and not compensated by, PRCC and protect its interests in
connection with the transaction;
(f) Optionee has been given the opportunity to review
all books, records and documents of PRCC and to ask questions and receive
answers from PRCC concerning PRCC's business, to obtain additional information
necessary to verify the accuracy of the information it has desired in order to
evaluate its investment, and to consult with such attorneys, accountants and
other advisors as it has desired;
(g) Its residence set forth below is its true and
correct residence, and it has no present intention of becoming a resident or
domiciliary of any other state or jurisdiction;
(h) In making the decision to accept the Option
and/or purchase the Option Shares, Optionee has relied solely upon independent
investigations made by it or on its behalf;
(i) No federal or state agency has made any finding
or determination as to the fairness of an investment in PRCC; and
(j) Optionee understands that all the representations
and warranties made by it herein, and all information furnished by it to PRCC,
are true, correct and complete in all respects.
6. Optionee hereby acknowledges that it understands the
meaning and legal consequences of the representations, warranties and covenants
contained herein and that PRCC has relied on the representations made by
Optionee in paragraph 5 hereof in granting this Option, and Optionee agrees to
indemnify and hold harmless PRCC and its officers, directors, controlling
persons, attorneys, agents and employees from and against any and all loss,
damage or liability, together with all costs and expenses (including attorneys'
fees and disbursements) which any of them may incur by reason of any breach and
any representation, warranty, covenant or agreement contained herein. All
representations, warranties, covenants and agreements, and the indemnification
contained herein shall survive the grant of the Option and the issuance of the
Option Shares by PRCC.
7. LEGEND OF CERTIFICATES. All Option Shares issued
pursuant to this Agreement shall be subject to the provisions of this Agreement
and the Consulting Agreement and
<PAGE> 5
the certificates representing such Option Shares shall bear the following legend
or language substantially equivalent thereto:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES
LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS SO REGISTERED OR QUALIFIED OR
UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY."
8. TRANSFERABILITY OF OPTION. The Option shall not be
transferable except by the laws of descent and distribution and any attempt to
do so shall void the Option.
9. ADJUSTMENT. The Option Price and the number and kind of
Option Shares shall be subject to corresponding adjustment in the event of any
change in the Common Stock by reason of any reclassification, recapitalization,
split-up, combination, exchange of shares, readjustment or stock dividend, in
like manner as if such Option Shares had been issued and outstanding, fully paid
and non-assessable at the time of such occurrence.
10. PRIVILEGE OF OWNERSHIP. Optionee shall not have any of the
rights of a shareholder with respect to the shares covered by the Option except
to the extent that one or more certificates for such Option Shares shall be
delivered to it upon one (1) or more exercises of the Option.
11. REGISTRATION RIGHTS. In the event, during the period
commencing on the date hereof and expiring two years from the last date of the
issuance of any Option Shares upon the exercise of the Option by the Optionee,
PRCC shall register any primary or secondary offering of any debt or equity
security issued or to be issued by it pursuant to a registration statement under
the Securities Act of 1933, as amended, pursuant to which the Option Shares can
be registered, the Company shall in each such event notify Optionee in writing
not less than thirty (30) days prior to filing such registration statement with
the Commission, and the Optionee shall have the right to register all of the
Option Shares therewith by notifying PRCC in writing, within fifteen (15) days
of
<PAGE> 6
receipt of PRCC's notice, requesting registration of the Option Shares and
setting forth the intended method of distribution and such other data or
information as PRCC or its counsel reasonably shall require. Such registration
shall be without cost to Optionee except for sales commissions and related fees
and/or transfer taxes incurred if the Option Shares are subsequently sold.
12. NOTICES. Any notices required or permitted to be given
under this Agreement shall be in writing and they shall be deemed to have been
given upon personal delivery or two (2) business days after mailing the notice
by postage, registered or certified mail. Such notice shall be addressed to the
party to be notified as shown below:
PRCC: POLLUTION RESEARCH AND CONTROL CORP.
506 Paula Avenue
Glendale, CA 91201
Attn: President
OPTIONEE: Fenway Advisory Group
c/o Neil C. Sullivan
1901 Avenue of the Stars
Twentieth Floor
Los Angeles, CA 90067
Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.
13. GENERAL PROVISIONS. This Agreement:
(a) Contains the entire agreement between PRCC and
Optionee regarding options of PRCC granted to Optionee pursuant to the
Consulting Agreement, and supersedes all prior communications, oral or written;
(b) Shall not be construed to give Optionee any
rights as to PRCC or the Common Stock, except as specifically provided herein;
(c) May not be amended nor may any rights hereunder
be waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver;
(d) Shall be construed in accordance with, and
governed by, the laws of the State of California; and
<PAGE> 7
(e) Shall be binding upon and shall inure to the
benefit of PRCC and Optionee, and their respective successors and assigns,
except that Optionee shall not have the right to assign or otherwise transfer
his rights hereunder to any person.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
PRCC:
POLLUTION RESEARCH AND CONTROL
CORP., a California corporation
By: /s/ Albert E. Gosselin
------------------------------------
Albert E. Gosselin, Jr.,
President and Chief Executive Officer
OPTIONEE:
/s/ Neil C. Sullivan
---------------------------------------
Fenway Advisory Group,
By: Neil C. Sullivan, President
<PAGE> 8
EXHIBIT A
To Pollution Research and Control Corp.
NOTICE AND AGREEMENT OF EXERCISE OF OPTION
I hereby exercise the Option granted to me by POLLUTION
RESEARCH AND CONTROL CORP., a California corporation ("PRCC"), dated as of
_______________________________ as to ___________________________ shares of
PRCC's no par value Common Stock.
Enclosed are the documents and payment specified in Paragraph
4 of my Agreement regarding the Option.
- ------------------------------ -----------------------------
(Print Your Name) Signature
<PAGE> 1
EXHIBIT 21
POLLUTION RESEARCH AND CONTROL CORP.
SUBSIDIARY LIST
Logan Medical Devices Inc.
506 Paula Avenue
Glendale, Ca 91201
Logan Research Limited
Unit B2, Spectrum Business Center
Anthony's Way
Rochester, Kent ME2 4Np ENGLAND
Nutek Incorporated
225 Brent Lane
Pensacola, Florida 32503
Dasibi Environmental Corp.
506 Paula Avenue
Glendale, California 91201
Dasibi - Southwest
506 Paula Avenue
Glendale, California 91201
Pacific Region Commerce
506 Paula Avenue
Glendale, California 91201
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<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 723
<SECURITIES> 99
<RECEIVABLES> 1,757
<ALLOWANCES> 46
<INVENTORY> 2,575
<CURRENT-ASSETS> 5,129
<PP&E> 1,857
<DEPRECIATION> 206
<TOTAL-ASSETS> 7,197
<CURRENT-LIABILITIES> 2,007
<BONDS> 1,036
0
0
<COMMON> 6,589
<OTHER-SE> (2,590)
<TOTAL-LIABILITY-AND-EQUITY> 3,999
<SALES> 8,805
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<CGS> 6,463
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