▇▇▇▇▇▇▇ ▇▇. ▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ AGREEMENT
AND
PLAN OF ACQUISITION
THIS STOCK EXCHANGE AGREEMENT AND PLAN OF ACQUISITION ("Agreement") is
entered into this 30th day of March 1999 by and between AR Associates, Inc., a
Nevada corporation ("AR"), and Ultra Clear Manufacturing & Distributing Limited,
a corporation organized under the laws of British Columbia, Canada ("Ultra
Clear") (AR and Ultra Clear may be individually or collectively as referred to
as a "Party" or the "Parties").
Recitals
WHEREAS, AR seeks a business entity with which to merge and Ultra Clear
seeks to merge with a company whose securities have been approved for trading by
the National Association of Securities Dealers, Inc. ("NASD").
WHEREAS, the Parties desire to effect AR's acquisition of Ultra Clear
by receiving all of the outstanding shares of Ultra Clear in exchange for ten
(10) shares of AR, thus making Ultra Clear a wholly owned subsidiary of AR.
Agreement
NOW, THEREFORE, based on the foregoing premises, which are incorporated
herein by this reference, and for and in consideration of the mutual covenants
and agreements contained herein, and in reliance on the representations and
warranties set forth in this Agreement, the benefits to be derived herein and
for other valuable consideration, the sufficiency of which is hereby expressly
acknowledged, the Parties agree as follows:
1. Acquisition. In accordance with the provisions of this Agreement, the
British Columbia Company Act and the Nevada Revised Statutes, Ultra
Clear shall be acquired by AR (the "Acquisition") and become a wholly
owned subsidiary of AR. Ultra Clear shall continue to possess all of
its assets, rights, powers and property as constituted immediately
prior to the closing and effectiveness of the Acquisition. The
Acquisition shall be accomplished by the exchange and transfer of
shares as outlined below.
2. Exchange of Shares. Subject to all the terms and conditions of this
Agreement, all of the 5,644,546 outstanding shares of common stock in
Ultra Clear, no par value (the "Ultra Clear Stock"), shall be exchanged
and transferred from the holders of such stock ("Ultra Clear
Shareholders") to AR. In exchange for the Ultra Clear Stock, AR shall
issue to each Ultra Clear Shareholder listed on Ultra Clear's books and
records as of Closing ten (10) shares of common stock in AR, par value
$0.001 (the "AR Common Stock"), for every one (1) share of Ultra Clear
Stock owned. Therefore, the Ultra Clear Shareholders shall collectively
receive a total of 56,445,460 shares of AR Common Stock. As soon as
practicable, on or after the effective date of the Acquisition, the
Ultra Clear Shareholders or their nominee(s) shall surrender the
certificates representing the Ultra Clear Stock to AR's stock transfer
agent, Signature Stock Transfer, Inc. Upon delivery of the certificates
together with an assignment in blank, the Ultra Clear Shareholders will
receive certificates for the AR Common Stock. When issued and
transferred to the Ultra Clear Shareholders, the AR Common Stock shall
be fully paid and non-assessable.
a. The current officers and directors of Ultra Clear shall remain
the officers and directors of Ultra Clear after the
Acquisition. Upon the effectiveness of the Articles of
Exchange filed with the Nevada Secretary of State, the Ultra
Clear Shareholders shall appoint officers and directors of AR,
or allow those serving as such to continue until successors
are appointed.
b. The Articles of Incorporation and Bylaws of AR in effect
immediately prior to the Acquisition will remain as such after
the Acquisition, without any modification or amendment as a
result of the Acquisition.
3. Exemption from Registration. The Parties hereto intend that the
exchange of shares be exempt from the registration requirements of the
Securities Act of 1933, as amended (the "Act"), and the rules and
regulations promulgated thereunder and exempt from the registration
requirements of the applicable states. All shares transferred and
acquired hereunder shall be `restricted securities' as such phrase is
defined in the Act.
4. Warranties and Representations of Ultra Clear In order to induce AR to
enter into this Agreement and to complete the transaction contemplated
hereby, Ultra Clear warrants and represents to AR that:
a. Organization and Standing. Ultra Clear is a corporation duly
organized, validly existing and in good standing under the
laws of the province of British Columbia, Canada. It is also
qualified to do business in every other state or jurisdiction
in which it operates and to own and operate its assets,
properties and business in such states or jurisdictions.
b. Capitalization. As of Closing, 100,000,000 shares of Ultra
Clear Stock, no par value, are authorized for issuance by
Ultra Clear, of which 5,644,546 shares of Common Stock are
issued and outstanding. No other voting or equity securities
are authorized or issued, nor are any authorized or issued
securities convertible into voting stock. Ultra Clear does not
have any outstanding subscriptions, warrants, calls, options,
rights, commitments or agreements by which Ultra Clear is
bound, calling for the issuance of any additional shares of
Common Stock or any other voting or equity security. The Ultra
Clear Stock constitutes 100% of the outstanding equity capital
of Ultra Clear and such stock constitutes 100% of Ultra
Clear's voting power, representing the exclusive right to
receive dividends, when, and if, declared and paid, and the
exclusive right to receive the proceeds of liquidation
attributable to Ultra Clear Stock, if any. From the date
hereof, and until the Closing Date, no dividends or
distributions of capital, surplus, or profits shall be paid or
declared by Ultra Clear in redemption of their outstanding
shares or otherwise. Except as described herein no additional
shares shall be issued in connection with this Acquisition by
Ultra Clear.
c. No Pending Actions. To the best of Ultra Clear's knowledge,
after diligent inquiry, there are no legal actions, lawsuits,
proceedings or investigations, either administrative or
judicial, pending or threatened against or affecting Ultra
Clear or its subsidiaries, or against any of the officers or
directors therewith that arise out of their operation of Ultra
Clear and its subsidiaries, nor is Ultra Clear or its
subsidiaries in material violation of any federal or state
law, ordinance or regulation of any kind whatever, including,
but not limited to laws, rules and regulations governing the
sale of its products, services or securities. Ultra Clear is
not an investment company, as defined in, or otherwise subject
to regulation under, the Investment Company Act of 1940.
d. Conduct of Business. Ultra Clear represents that it shall not
materially change the normal course of its business operations
prior to Closing. Ultra Clear shall not amend its Articles of
Incorporation or Memorandum (except as may be described in
this Agreement), declare dividends, redeem securities, incur
additional or newly_funded liabilities outside the ordinary
course of business, acquire or dispose of fixed assets, change
employment terms, enter into any material or long_term
contract, guarantee obligations of any third party, settle or
discharge any balance sheet receivable for less than its
stated amount, pay more on any liability than its stated
amount, or enter into any other transaction without the prior
approval of AR, not to be unreasonably withheld.
e. Authority, No Conflict. This Agreement constitutes the legal,
valid, and binding obligation of Ultra Clear, enforceable
against Ultra Clear in accordance with its terms. Ultra Clear
has the absolute and unrestricted right, power, authority, and
capacity to execute and deliver this Agreement and to perform
its obligations under this Agreement. Neither the execution or
delivery of this Agreement nor the consummation or performance
of the Acquisition will contravene, conflict with, or result
in a violation of any Ultra Clear organizational document, or
any external restraint, ruling, agreement or judgment relating
to Ultra Clear.
5. Warranties and Representations of AR. In order to induce Ultra Clear to
enter into this Agreement and to complete the transaction contemplated
herein, AR warrants and represents to Ultra Clear that:
a. Organization and Standing. AR is a corporation duly organized,
validly existing and in good standing under the laws of
Nevada. It is also qualified to do business in every other
state or jurisdiction in which it operates and to own and
operate its assets, properties and business in such states or
jurisdictions.
b. Capitalization. As of Closing, AR shall have authorized for
issuance 100,000,000 shares of voting Common Stock, $0.001 par
value. As of Closing, AR shall have a total of 4,000,000
shares of its Common Stock issued and outstanding, which
shares are validly issued, fully paid and non-assessable. To
the best of AR's knowledge, all such issued and outstanding
shares were issued pursuant to a valid registration statement
under the Act or pursuant to valid exemptions therefrom.
c. Ownership of Shares. Upon the transfer of the AR Common Stock
to the Ultra Clear Shareholders pursuant to this Agreement,
the Ultra Clear Shareholders will thereby acquire good and
absolute marketable title thereto, and will be subject to the
resale terms as set forth herein. Such securities shall be
subject to restrictions imposed by the Act, and applicable
state Blue Sky laws due to lack of registration with any
federal or state securities commissions or authorities.
d. No Pending Actions. To the best of AR's knowledge, after
diligent inquiry, there are no legal actions, lawsuits,
proceedings or investigations, either administrative or
judicial, pending or threatened against or affecting AR, or
against any of AR's officers or directors that arise out of
their operation of AR, nor is AR in violation of any federal
or state law, material ordinance or regulation of any kind
whatever, including, but not limited to laws, rules and
regulations governing the sale of its products, services or
securities. AR is not an investment company, as defined in, or
otherwise subject to regulation under, the Investment Company
Act of 1940.
e. Authority, No Conflict. This Agreement constitutes the legal,
valid, and binding obligation of AR, enforceable against AR in
accordance with its terms. AR has the absolute and
unrestricted right, power, authority, and capacity to execute
and deliver this Agreement and to perform its obligations
under this Agreement. Neither the execution or delivery of
this Agreement nor the consummation or performance of the
Acquisition will contravene, conflict with, or result in a
violation of any AR organizational document, or any external
restraint, ruling, agreement or judgment relating to AR.
6. No Misleading Statements or Omissions. Neither this Agreement nor any
Schedule or Documents attached hereto or presented to AR by Ultra Clear
or to Ultra Clear by AR in connection with this Agreement or the
Acquisition, contains any materially misleading statement, or omits any
fact of statement necessary to make the other statements or facts
therein set forth not materially misleading.
7. Validity of this Agreement. By Closing, all corporate and other
proceedings required to be taken by Ultra Clear and AR in order to
enter into and to carry out this Agreement shall have been duly and
properly taken. Upon execution, this Agreement shall constitute the
valid, binding and enforceable obligations of the Parties and shall
inure to the benefit of the heirs, executors, administrators and
assigns of the Ultra Clear Shareholders and upon the successors and
assigns of AR, except to the extent limited by applicable bankruptcy,
reorganization, insolvency, moratorium or other laws relating to or
effecting generally the enforcement of creditors rights. The execution
and delivery of this Agreement and these stated terms shall not result
in the breach of any of the terms or conditions of, or constitute a
default under or violate the Parties' Articles of Incorporation thereto
or any similar document of undertaking, oral or written, to which the
Parties are a party to or is bound or may be affected by, nor will such
execution, delivery and carrying out violate any order, writ,
injunction, decree, law, rule or regulation of any court, regulatory
agency or other governmental body; and the business now conducted by
the Parties can continue to be so conducted after completion of the
transaction contemplated hereby, with Ultra Clear as a wholly-owned
subsidiary of AR.
8. Access to Books and Records. During the course of the Acquisition
through Closing, AR and Ultra Clear agree to make available for
inspection all corporate books, records and assets, and otherwise
afford to each other and their respective representatives, reasonable
access to all documentation and other information concerning the
business, financial and legal conditions of each other for the purpose
of conducting a due diligence investigation thereof. Such due diligence
investigation shall be for the purpose of satisfying each party as to
the business, financial and legal condition of each other for the
purpose of determining the desirability of consummating the proposed
Acquisition. The Parties further agree to keep confidential and not use
for their own benefit, except in accordance with this Agreement and the
Acquisition, any information or documentation obtained in connection
with any such investigation.
9. Survival; Indemnification. All representations, warranties, covenants
and agreements made herein shall survive the execution and delivery of
this Agreement and Closing. Each of the Parties (as an "Indemnifying
Party") hereby agree, jointly and severally, to indemnify, defend, and
hold the other Party (as an "Indemnified Party") harmless from and
against any damage, loss liability, or expense (including, without
limitation, reasonable expenses of investigation and reasonable
attorney's fees) arising out of any material breach of any
representation, warranty, covenant, or agreement made by the
Indemnifying Party.
10. Restricted Shares; Legend. The 56,445,460 shares of AR Common Stock to
be issued to the Ultra Clear Shareholders will be issued pursuant to
exemptions from registration and therefore shall be "restricted
securities" as defined in the Act; and each stock certificate issued to
such recipients hereunder will bear a restrictive legend substantially
as follows:
The shares of stock represented by this certificate have not
been registered under the Securities Act of 1933, as amended,
or under the securities laws of any state and may not be sold
or otherwise transferred unless in compliance with the
registration provisions of such Act and state laws or unless
availability of an exemption from such registration provisions
has been established.
Appropriate stop transfer instructions regarding such shares shall be
given to AR's stock transfer agent, Signature Stock Transfer, Inc.
11. Expenses. Each of the Parties shall bear and pay the costs and expenses
they have allocated prior to the execution of the Agreement and that
they shall bear and pay the costs incurred by them or on their behalf
in connection with the consummation of this Agreement, including,
without limiting the generality of the foregoing, fees and expenses of
financial consultants, accountants and counsel and the cost of any
documentary stamps, sales and excise taxes which may be imposed upon or
be payable in respect to the transaction.
12. Closing. The Closing of the transactions contemplated by this Agreement
("Closing") shall take place as soon as all Parties have supplied the
required documents and obtained the required approvals as discussed
herein. Closing shall take place at such place as the Parties hereto
shall agree upon or by facsimile transmission and overnight delivery
service.
13. Deliveries. At or after Closing, each Ultra Clear Shareholder may
deliver or surrender a certificate or certificates representing all of
such shareholder's Ultra Clear Stock. Upon delivery of such shares, AR
will instruct its transfer agent to deliver a certificate evidencing a
number of shares of AR Common Stock equal to the number of Ultra Clear
shares so surrendered.
14. Conditions Precedent to Closing. The obligations of the Parties under
this Agreement shall be and are subject to fulfillment, prior to or at
the Closing, of each of the following conditions:
a. That each of the representations and warranties of the Parties
contained herein shall be true and correct at the time of the
Closing date as if such representations and warranties were
made at such time;
b. That the Parties shall have performed or complied with all
agreements, terms and conditions required by this Agreement to
be performed or complied with by them prior to or at the time
of the Closing;
15. Termination. This Agreement may be terminated at any time before or, at
Closing, by:
a. The mutual agreement of the Parties;
b. Any party if:
i. Any provision of this Agreement applicable to a party
shall be materially untrue or fail to be
accomplished; or
ii. Any legal proceeding shall have been instituted or
shall be imminently threatening to delay, restrain or
prevent the consummation of this Agreement.
c. Upon termination of this Agreement for any reason, in
accordance with the terms and conditions set forth in this
paragraph, each said party shall bear all costs and expenses
as each party has incurred and no party shall be liable to the
other.
16. Miscellaneous Provisions. This Agreement is the entire agreement
between the Parties in respect of the subject matter hereof, and no
other agreements exist, written or oral, nor may this Agreement be
modified except in writing and executed by all of the Parties hereto.
The failure to insist upon strict compliance with any of the terms,
covenants or conditions of this Agreement shall not be deemed a waiver
or relinquishment of such right or power at any other time or times.
17. Controlling Law. The validity, interpretation, and performance of this
Agreement shall be governed by the laws of the province of British
Columbia, Canada, without regard to its law on the conflict of laws.
Any dispute arising out of this Agreement shall be brought in a court
of competent jurisdiction in British Columbia, Canada. The Parties
exclude any and all statutes, laws and treaties which would allow or
require any dispute to be decided in another forum or by other rules of
decision than provided in this Agreement.
18. Notices. All notices, requests, instructions, or other documents to be
given hereunder shall be in writing and sent by registered mail to the
Parties at the following addresses:
a. If to AR: AR Associates, Inc.
Attn: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇, President
▇.▇. ▇▇▇ ▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
b. If to Ultra Clear: Ultra Clear Manufacturing &
Distributing Limited
Attn: ▇▇▇▇▇ ▇▇▇▇▇, President
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇
19. Finders and Brokers. The Parties agree that neither has utilized any
finder or broker in bringing the Parties together or who were
instrumental in the negotiation, execution, or consummation of this
Agreement. Further, the Parties each agree to indemnify the other
against any claim by any third person for any commission, brokerage or
finder's fee or other payment with respect to this Agreement or the
transaction contemplated hereby based on any alleged agreement or
understanding between such party and such third person, whether express
or implied, from the actions of such party. The covenants set forth in
this section shall survive Closing and the consummation of the
transaction herein contemplated.
20. Counterparts. This Agreement may be executed in duplicate facsimile
counterparts, each of which shall be deemed an original and together
shall constitute one and the same binding Agreement, with one
counterpart being delivered to each party hereto.
IN WITNESS WHEREOF, the foregoing Agreement, having been duly approved
and adopted by the Board of Directors, and duly approved and adopted by the
stockholders of the constituent corporations, as required, in the manner
provided by the laws of the state of Nevada and province of British Columbia,
Canada, the presidents of the Parties do now execute this Agreement under the
authority of the directors and stockholders of each.
AR Associates, Inc.
By: /s/ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇▇, President
Ultra Clear Manufacturing &
Distributing Limited
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇, President
