CALMEC
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California Electronics Corporation
Xxx X. Xxxxxxx, Chairman
RIGHTS AGREEMENT
This agreement ("Rights Agreement") is entered into as of June 1, 2000, by
California Molecular Electronics Corp. ("CALMEC" or the "Company"), in favor of
its President and CEO, Xxxxx X. Xxxxx, Xx.
WHEREAS under a certain agreement of employment ("Employment Agreement"), Xx.
Xxxxx has agreed to work for CALMEC without full compensation until such date
(the "Full Comp Date") as the board of directors of CALMEC determines that the
Company is able to begin the payment of full compensation to Xx. Xxxxx for his
services and is also able to perform under Item 2 of this agreement (see below);
and
WHEREAS CALMEC has granted a Rolling Option to Xx. Xxxxx under an incentive
stock option granted as of May 1, 2000 ("Rolling Option") that entitles him to
purchase any portion of N shares of Company stock, where the number N is a
variable that will grow as time passes until the Full Comp Date and may be
reduced as, and if, the Rolling Option is exercised from time to time by Xx.
Xxxxx.
NOW THEREFORE, CALMEC agrees as follows:
At any time after the Full Comp Date, Xx. Xxxxx shall have the one time right
under this Rights Agreement to terminate the Rolling Option and require the
Company to:
1. Issue him M shares of common stock, and/or
2. Pay him cash value at $6.00 per share for S shares, where the sum of M
and S is equal to the number of unexercised shares under the Rolling
Option at the time of termination.
IN WITNESS WHEREOF, CALMEC has executed this Rights Agreement as of the day and
year first above written.
CALMEC:
BY: /s/ Xxx X. Xxxxxxx
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Xxx X. Xxxxxxx, Chairman
Confirmation:
/s/ Xxxxx X. Xxxxx, Xx
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Xxxxx X. Xxxxx, Xx.
