AGREEMENT
THIS AGREEMENT (the "Agreement") is made and entered into this 21st day of
September, 2001, by and between Pollution Research and Control Corp., a
California corporation ("PRCC"), 000 Xxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxx 00000,
and Astor Capital, Inc., a California corporation ("Astor Capital"), 0000
Xxxxxxxx Xxxxxxxxx, Xxxxx #000, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000.
RECITALS:
WHEREAS, in order to fulfill its fiduciary responsibilities to its
shareholders and the holders of its outstanding convertible debentures, PRCC
desires to take the following actions:
A. Divest itself of "control" of Dasibi by "spinning-off" 85% of the
outstanding shares of common stock of Dasibi to the shareholders of PRCC.
B. Cause the current directors and executive officers of PRCC to resign
their positions with PRCC and elect the individuals designated by Astor Capital
to replace them as directors of PRCC.
NOW, THEREFORE, in consideration of the foregoing premises, the mutual
promises, covenants, agreements, representations and warranties set forth
hereinafter, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Spin-Off of Dasibi. PRCC and the current Board of Directors of PRCC agree to
take all action required or appropriate to distribute a total of 4,660,000
restricted shares of common stock, no par value per share (the "Dasibi Common
Stock"), of Dasibi pro rata to the shareholders holding "free-trading" shares of
common stock, no par value per share (the "PRCC Common Stock"), of PRCC on the
record date determined by the Board of Directors of PRCC (the "Record Date"),
and a total of 1,570,000 restricted shares of Dasibi Common Stock pro rata to
the shareholders holding restricted shares of PRCC Common Stock issued prior to
September 20, 2001. This action shall include, but not be limited to, effecting
a forward split in the then outstanding shares of Dasibi Common Stock such that
a sufficient number of shares of Dasibi Common Stock is available to accomplish
the distribution. The parties agree that PRCC shall retain 1,100,000 restricted
shares of Dasibi Common Stock immediately following the distribution. The total
number of restricted shares of Dasibi Common Stock subject to this section to be
distributed to the shareholders of PRCC designated herein (6,230,000 share) or
retained by PRCC (1,100,000 shares) is 7,330,000 shares.
2. Change in Management. PRCC agrees to cause the directors and executive
officers of PRCC on the date of this Agreement to submit their resignations from
these positions to be effective as of the Record Date. Prior to resigning, Xx.
Xxxxxx X. Xxxx, as the last remaining director of PRCC, shall cause the
individual(s) designated by Astor Capital to be elected to replace the directors
resigning and, if necessary, cause the size of the Board of Directors of PRCC to
be increased and the individual(s) designated by Astor Capital to be elected to
fill the vacancy or vacancies caused by the increase in the size of the Board of
Directors.
3. Dilution. If, prior to the Record Date, PRCC shall issue any shares of PRCC
Common Stock in excess of the number of outstanding shares of PRCC Common Stock
on the date of this Agreement that do not increase or maintain the asset value
per share of PRCC Common Stock on the date of the Closing, then, and in that
event, the 1,100,000 shares of Dasibi Common Stock to be retained by PRCC in
accordance with the provisions of section 2 above shall be reduced in the amount
of the percentage of dilution suffered by PRCC.
4. Closing. The transactions contemplated by this Agreement shall be effectuated
at a closing (the "Closing") that shall occur at the offices of PRCC, 000 Xxxxx
Xxxxxx, Xxxxxxxx, Xxxxxxxxxx, not later than Monday, September 24, 2001. At the
Closing, as conditions thereto, PRCC shall cause the following to be delivered:
a. To Xxxxxxxx Xxxx, Esq., as escrow agent to be held in escrow, three
(3) stock certificates in the amounts of 4,660,000, 1,570,000 and 1,100,000
restricted shares, respectively, of Dasibi Common Stock, each in the name
of "Xxxxxxxx Xxxx, Esq., Escrow Agent" to be distributed in accordance with
the provisions of section 1 above.
b. To Astor Capital, letters of resignation of the directors and
executive officers of PRCC described in section 2 above.
5. Representations and Warranties of PRCC.
a. Organization and Corporate Power. PRCC is a corporation duly
organized, validly existing and in good standing under the laws of the
State of California, and is duly qualified and in good standing to do
business as a foreign corporation in each jurisdiction in which such
qualification is required and where the failure to be so qualified would
have a materially adverse effect upon PRCC. PRCC has all requisite
corporate power and authority to conduct its business as now being
conducted and to own the personal property that it now owns. The Articles
of Incorporation of PRCC, as amended to date, and the Bylaws of PRCC,
copies of which have been delivered to Astor Capital, are true and complete
copies thereof as in effect as of the date of this Agreement.
b. Authorization. PRCC has full power, legal capacity and authority to
enter into this Agreement and all attendant documents and instruments
necessary to consummate the transactions herein contemplated; to distribute
the shares of Dasibi Common Stock to the shareholders of PRCC in accordance
with the provisions of section 1. above; and to perform all of the
obligations to be performed by PRCC hereunder. This Agreement and all other
agreements, documents and instruments to be executed in connection herewith
by PRCC have been duly executed and delivered by PRCC, and no other
corporate proceedings on the part of PRCC are required to authorize the
execution and delivery of this Agreement, such other agreements, documents
and instruments and the transactions contemplated hereby. This Agreement
and such other agreements, documents and instruments have been duly
executed and delivered by PRCC; constitute the legal, valid and binding
obligation of PRCC; and are enforceable with respect to PRCC in accordance
with their respective terms, except as enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, priority or other laws or court
decisions relating to or affecting generally the enforcement of creditors'
rights or affecting generally the availability of equitable remedies.
Neither the execution and delivery of this Agreement, the consummation by
PRCC of any of the transactions contemplated hereby nor the compliance by
PRCC with any of the provisions hereof will (i) conflict with or result in
a breach of, violation of or default under any of the terms, conditions or
provisions of any note, bond, mortgage indenture, license, lease, credit
agreement or other agreement, document, instrument or obligation
(including, without limiation, any of PRCC's charter document) to which
PRCC is a party or by which PRCC or any of the assets or properties of PRCC
may be bound or (ii) violate any judgment, order, injunction, decree,
statute, rule or regulation applicable to PRCC or any of the assets or
properties of PRCC. To the best knowledge of PRCC, no authorization,
consent or approval of any public body or authority is necessary for the
consummation by PRCC of the transactions contemplated by this Agreement.
c. Compliance with Laws. To the best knowledge of PRCC, PRCC holds all
licenses, franchises, permits and authorizations necessary for the lawful
conduct of its business as presently conducted, and has complied with all
applicable statutes, laws, ordinances, rules and regulations of all
governmental bodies, agencies and subdivisions having, asserting or
claiming jurisdiction over it, with respect to any part of the conduct of
its business and corporate affairs.
d. Disclosure. Neither this Agreement, nor any certificate, exhibit or
other written document or statement, furnished to Astor Capital by PRCC in
connection with the transactions contemplated by this Agreement contains or
will contain any untrue statement of a material fact or omits or will omit
to state a material fact necessary to be stated in order to make the
statements contained herein or therein not misleading.
2
6. Representations and Warranties of Astor Capital.
a. Authorization. Astor Capital has full power, legal capacity and
authority to enter into this Agreement and all attendant documents and
instruments necessary to consummate the transactions herein contemplated as
agent for the following holders of outstanding convertible debentures of
PRCC in the aggregate face amount of $2,270,000: Brittanica Associates
Limited, Target Growth Fund, IIG Equities Opportunities Fund Ltd., Xxxxxx
Xxxxxxxx, Xxxxx Xxxxxx, JRT Holdings, Xxxxxxxxx Xxxxxx, Xxxxxx X. Xxxxxx,
Xx., Xxxxxxxxxx Xxxxxxxxx and Xxxxxx Del Xxxxxxx; to distribute the shares
of Dasibi Common Stock to the shareholders of Astor Capital in accordance
with the provisions of section 1. above; and to perform all of the
obligations to be performed by Astor Capital hereunder. This Agreement and
all other agreements, documents and instruments to be executed in
connection herewith by Astor Capital have been duly executed and delivered
by Astor Capital, and no other corporate proceedings on the part of Astor
Capital are required to authorize the execution and delivery of this
Agreement, such other agreements, documents and instruments and the
transactions contemplated hereby. This Agreement and such other agreements,
documents and instruments have been duly executed and delivered by Astor
Capital; constitute the legal, valid and binding obligation of Astor
Capital; and are enforceable with respect to Astor Capital in accordance
with their respective terms, except as enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, priority or other laws or court
decisions relating to or affecting generally the enforcement of creditors'
rights or affecting generally the availability of equitable remedies. To
the best knowledge of Astor Capital, no authorization, consent or approval
of any public body or authority is necessary for the consummation by Astor
Capital of the transactions contemplated by this Agreement.
b. Disclosure. Neither this Agreement, nor any certificate, exhibit or
other written document or statement, furnished to PRCC by Astor Capital in
connection with the transactions contemplated by this Agreement contains or
will contain any untrue statement of a material fact or omits or will omit
to state a material fact necessary to be stated in order to make the
statements contained herein or therein not misleading.
7. Indemnification.
x. Xxxxx hereby agrees to indemnify and hold harmless each of the
executive officers and directors of PRCC on the Record Date with respect to
any and all claims, losses, damages, obligations, liabilities and expenses,
including, without limitation, reasonable legal and other costs and
expenses of investigating and defending any actions or threatened actions,
which any such individual may incur or suffer following the Closing by
reason of any breach of any of the representations and warranties of Astor
Capital contained herein.
b. PRCC hereby agrees to indemnify and hold harmless each of the
executive officers and directors of Astor Capital on the Record Date with
respect to any and all claims, losses, damages, obligations, liabilities
and expenses, including, without limitation, reasonable legal and other
costs and expenses of investigating and defending any actions or threatened
actions, which any such individual may incur or suffer following the
Closing by reason of any breach of any of the representations and
warranties of PRCC contained herein.
8. Miscellaneous.
a. Other Documents. 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 it for the
implementation and consummation of this Agreement and the transactions
herein contemplated.
b. Parties in Interest. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and the successors and assigns of each
of them, but shall not confer, expressly or by implication, any rights or
remedies upon any other party.
3
c. Governing Law. This Agreement is made and shall be governed in all
respects, including validity, interpretation and effect, by the laws of the
State of California.
d. Notices. 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:
(i) If to PRCC, to:
Pollution Research and Control Corp.
000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
(ii) If to Astor Capital, to:
Astor Capital, Inc.
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx #000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Either party hereto may change its address by written notice to the other
party given in accordance with this section 5d.
e. Entire Agreement. 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.
Each party hereto acknowledges that no representations, inducements,
promises or agreements, verbal or otherwise, have been made by either party
or anyone acting with authority on behalf of either party that are not
embodied herein, and that no other agreement, statement or promise may be
relied upon or shall be valid or binding. Neither the Agreement nor any
term hereof may be changed, waived, discharged or terminated verbally. This
Agreement may be amended or any term hereof may be changed, waived,
discharged or terminated by an agreement in writing signed by both parties
hereto.
f. Headings. The captions and headings used herein are for convenience
only and shall not be construed as part of this Agreement
g. Attorneys' Fees. In the event of any litigation between the parties
hereo, the non-prevailing party or parties shall pay the reasonable
expenses, including but not limited to the attorneys' fees, of the
prevailing party in connection therewith.
4
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the day and year first above written.
POLLUTION RESEARCH AND ASTOR CAPITAL, INC.
CONTROL CORP.
By: /s/ Xxxxxx X. Xxxxxxxx By: /s/ Xxxxxxx Xxxxxx
----------------------- -------------------------
Xxxxxx X. Xxxxxxxx, Xx., President Xxxxxxx Xxxxxx, President
By: /s/ Xxxxxx X. Xxxx By: /s/ Xxx Xxxxxxxx
----------------------- -------------------------
Xxxxxx X. Xxxx, Chief Financial Xxx Xxxxxxxx, Secretary
Officer
5
