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 November 1, 1999
VOID AFTER 5:00 P.M., LOS ANGELES TIME, ON February 25, 2002
This certifies that Anthony Reneau 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 $1.00 per share ("Purchase Price").
This Option is exercisable from November 1, 1999 to and including 5:00
p.m., Los Angeles time, on February 25, 2002.
Registered Owner: Anthony Reneau
Purchase Price: $1.00 per share
<PAGE>
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered into effective
as of February 26, 1999 by and between Pollution Research and Control Corp., a
California corporation ("PRCC") and Anthony Reneau ("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 $1.00 (the ""Option Price"), and for purposes of record, the bid price of the
Company's stock on this date was $1.38.
3. Option Period. The option period shall commence on November 1, 1999 (the
"Date of Grant") and shall terminate February 25, 2002.
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.
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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, 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;
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<PAGE>
(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:
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<PAGE>
"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: Anthony Reneau
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.
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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/ Anthony Reneau
------------------
Anthony Reneau
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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
