STOCK PURCHASE AGREEMENT ("Agreement"), effective as of June ___, 1997, by
and among Royal Capital, Inc., a Delaware corporation with offices located at 75
Claremont  Road,  Bernardsville,  New Jersey 07924 (the  "Company");  Whitestone
Industries,  Inc.,  a Delaware  corporation  with  offices  located at 19200 Von
Karmen Avenue,  Irvine,  California 92715  ("Whitestone");  and Donald R. Yu, an
individual  residing  at 6363  Christie  Avenue,  Emeryville,  California  94608
("Stockholder").

      WHEREAS,  the Company desires to acquire control of Whitestone through the
acquisition  of all  outstanding  shares  of  stock  of  Whitestone  held by the
Stockholder in accordance with the terms and conditions set forth herein; and

      WHEREAS,  the  Stockholder  desires  to  acquire  control  of Golden  Bear
Entertainment Corp. ("Golden"), a wholly owned subsidiary of Whitestone, through
the  acquisition  of all  outstanding  shares of capital stock of Golden held by
Whitestone at time of Closing in accordance  with the terms and  conditions  set
forth herein;

      NOW, THEREFORE,  in consideration of the covenants set forth herein, it is
agreed as follows:

                                    ARTICLE I

                                  THE EXCHANGE

      1.1 Terms of Purchase.  On the basis of the  representations,  warranties,
covenants  and  agreements  contained  herein,  and  subject  to the  terms  and
conditions of this Agreement.

      (i) The Stockholder shall sell, assign, transfer and convey to the Company
      at the Closing  Date (as  hereinafter  defined) or as soon  thereafter  as
      practicable  1,120,000 shares of Whitestone Common Stock, $.0001 par value
      ("Common

<PAGE>

      Stock") and 100,000 shares of Whitestone  Series A Preferred  Stock,  $.01
      par value ("Preferred  Stock")(collectively  the "Whitestone Shares"). The
      Stockholder  shall deliver at the Closing Date  certificates  representing
      the  Whitestone  Shares  duly  endorsed in blank or  accompanied  by stock
      powers duly  endorsed in blank,  in each case in proper form for transfer,
      with signatures guaranteed as reasonably requested by the Company and with
      all stock transfer and other required  documentary stamps affixed thereto.

      (ii) In  consideration  for the Whitestone  Shares,  (i) the Company shall
      deliver to  Stockholder  at the Closing Date a check or wire in the amount
      of  $100,000,  of  which  $10,000  has  been  previously  paid;  and  (ii)
      Whitestone  shall  issue  to  Stockholder  certificates  representing  all
      outstanding  shares of the capital stock of Golden ("Golden  Shares") held
      by Whitestone.

                                   ARTICLE II

                                     CLOSING

      2.1 Closing. The Closing contemplated by Article 1 of this Agreement shall
be held at the offices of Silverman,  Collura,  Chernis & Balzano,  P.C.  within
five days after the  conditions  set forth in Article 7 of this  Agreement  have
been  satisfied,  unless  another  place or on such  date as is  agreed  upon in
writing by the parties (the "Closing Date").

      2.2 After the Closing Date and from time to time  thereafter,  the parties
to this Agreement shall execute such additional  instruments and take such other
action as  either  party  may  reasonably  request  in order to  effectuate  the
transactions contemplated by this Agreement.


                                       2
<PAGE>

                                   ARTICLE III

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

      The Company  represents and warrants to Whitestone and the  Stockholder as
follows:  

      3.1  Organization  and  Standing.   The  Company  is  a  corporation  duly
organized,  validly existing and in good standing under the laws of the State of
Delaware and has all requisite power, qualification and authority,  corporate or
otherwise,  to own, lease and operate its properties and assets and carry on its
business as and in the places  where such  properties  and assets are now owned,
leased or operated or such business is now being conducted.

      3.2  Authorization.  The Company has all requisite  power and authority to
execute, deliver and perform this Agreement. All necessary corporate proceedings
of the Company have been duly taken to  authorize  the  execution,  delivery and
performance  of this  Agreement by the  Company.  This  Agreement  has been duly
authorized,  executed and delivered by the Company,  constitutes the legal valid
and binding obligation of the Company, and is enforceable in accordance with the
terms hereof.

      3.3 No Further Action Needed. No consent, authorization,  approval, order,
license,  certificate,  permit,  declaration or filing with, any federal, state,
local or other governmental authority or any court or other tribunal is required
by the Company for the  execution,  delivery or performance of this Agreement by
the Company.  No consent of any party to any  contract,  agreement,  instrument,
lease, license,  arrangement,  or understanding to which the Company is a party,
or to which it or any of its  properties or assets are subject,  is required for
the  execution,  delivery  or  performance  of this  Agreement.  The  execution,
delivery and performance of this Agreement will not violate,  result in a breach
of, conflict with, or entitle any party to terminate


                                       3
<PAGE>

or call a default under any term of any contract, agreement,  instrument, lease,
license,  arrangement,  or  understanding  whereby the Company is a party to, or
violate or result in a breach of any term of the  Certificate  of  Incorporation
(or other charter document) or by-laws of the Company,  or violate,  result in a
breach of, or conflict  with any law,  rule,  regulation,  order,  judgment,  or
decree  binding  on the  Company  or to which any of its  operations,  business,
properties or assets are subject.

      3.4 Veracity of Statements. Neither this Agreement nor the representations
and   warranties  by  the  Company   contained   herein  or  in  any  documents,
instruments,certificates or schedules furnished pursuant hereto or in connection
with the  transactions  contemplated  hereby contains any untrue  statement of a
material fact or omits to state a material fact necessary to make the statements
or facts  contained  herein and therein not  misleading.  There is no fact which
adversely  affects,  or in  the  future  may  adversely  affect,  the  business,
operations,  affairs,  condition  or prospects of the  Company's  assets  and/or
business which has not been set forth in this Agreement.

                                    ARTICLE 4

          REPRESENTATIONS AND WARRANTIES OF WHITESTONE AND STOCKHOLDER

      Whitestone and Stockholder  hereby represent and warrant to the Company as
follows:

      4.1 Organization and Standing. Whitestone is a corporation duly organized,
validly  existing and in good  standing  under the laws of the State of Delaware
and has all requisite power and authority, corporate or otherwise, to own, lease
and operate its  properties  and to carry on its  businesses in the places where
such properties are now owned,  leased or operated or such business is now being
conducted, or contemplated to be conducted.


                                       4
<PAGE>

      4.2  Authorization.  Whitestone  has all  requisite  power and  authority,
corporate and otherwise,  to enter into this Agreement and to assume and perform
its obligations hereunder.  The execution and delivery of this Agreement and the
performance by Whitestone of its  obligations  hereunder will be duly authorized
by all necessary  corporate action. No further action or approval,  corporate or
otherwise,  will be required in order to constitute  this  Agreement as a valid,
binding and enforceable obligation of Whitestone.

      4.3 Capitalization. The authorized capital stock of Whitestone consists of
30,000,000  shares of $.0001 par value Common Stock ("Common  Stock"),  of which
5,924,320 shares are issued and outstanding.  Each of such outstanding shares of
Common  Stock  is  validly  authorized,   validly  issued  and  fully  paid  and
non-assessable, has not been issued and is not owned or held in violation of any
preemptive  right of  stockholders.  At the Closing Date, the Whitestone  Shares
shall be validly issued, fully paid and non-assessable.

      4.4  Lack of  Commitment  to  Issue  Securities.  There  is not  presently
outstanding  nor is there any  commitment,  plan, or arrangement  to issue,  any
options,  warrants or other  rights  calling  for the  issuance of any shares of
stock of  Whitestone  or any  security  or other  instrument  convertible  into,
exercisable for or exchangeable for stock of Whitestone,  except as disclosed on
Schedule 4.4 attached hereto.

      4.5  Financial  Condition.  Annexed  hereto as  Schedule  4.5 are true and
correct  copies of the  following:  (i) audited  consolidated  balance sheets of
Whitestone  for its last three fiscal years ended  December 31, 1996,  1995, and
1994; (ii) the unaudited  balance sheet of Whitestone as of March 31, 1997 (most
recent  date  available);  (iii)  audited  consolidated  statements  of  income,
statements of retained earnings, and statements of changes in financial position
and/or


                                       5
<PAGE>

cash flow of Whitestone for the last three fiscal years ended December 31, 1996,
1995 and  1994;  and (iv)  the  unaudited  consolidated  statements  of  income,
consolidated  statements of retained  earnings,  and consolidated  statements of
changes in financial  position  and/or cash flow of Whitestone for the three (3)
months ended March 31, 1997 (most  recent  available).  Each such balance  sheet
presents fairly the consolidated financial condition,  assets, liabilities,  and
stockholders' equity of Whitestone as of its date; each such statement of income
and statement of retained earnings  presents fairly the consolidated  results of
operations of Whitestone  for the period  indicated;  and each such statement of
changes in financial  position and/or cash flow presents fairly the consolidated
information  purported to be shown therein. The financial statements referred to
in this Section 4.5 have been prepared in  accordance  with  generally  accepted
accounting principles  consistently applied throughout the periods involved, are
correct  and  complete,  and are in  accordance  with the books and  records  of
Whitestone.

      4.6 Lack of  Material  Changes.  Since  March 31,  1997  (the most  recent
audited  financial  statement  date) except as described on Schedule 4.6 annexed
hereto,

      (a)   There has not been any  material  adverse  change  in the  financial
            condition,  results of  operations,  business,  properties,  assets,
            liabilities, or future prospects of Whitestone.

      (b)   Whitestone  has not  authorized,  declared,  paid,  or effected  any
            dividend  or  liquidating  or other  distribution  in respect of its
            capital  stock or any direct or indirect  redemption,  purchase,  or
            other acquisition of any such stock.


                                       6
<PAGE>

      (c)   The operations and business of Whitestone have been conducted in all
            respects only in the ordinary course.

      (d)   Whitestone has not mortgaged,  pledged or subjected to lien or other
            encumbrances any of its assets.

      (e)   Whitestone  has not suffered an  extraordinary  loss (whether or not
            covered by insurance) or waived any right of substantial value.

      (f)   Whitestone  has not sold or  transferred  any of its assets having a
            book  value of  $100,000  or more or  canceled  any debts or claims,
            except, in each case, in the ordinary course of business.

      (g)   There has not been any issuance of the  Whitestone's  capital stock,
            bonds or other corporate securities.

      (h)   There has not been any strike, lockout, labor trouble or any similar
            event or condition of any character adversely affecting the business
            of Whitestone.

      (i)   There has not been any  increase in the  compensation  payable or to
            become  payable by Whitestone  to any of its officers,  employees or
            agents,  or any known payment or arrangement  made to or with any of
            such persons, except as disclosed to the Company.

      There is no fact known to Whitestone which materially adversely affects or
in the future (as far as Whitestone can foresee) may materially adversely affect
the financial condition, results of operations,  business,  properties,  assets,
liabilities, or future prospects of Whitestone;


                                       7
<PAGE>

provided,  however,  that  Whitestone  express  no opinion  as to  political  or
economic matters of general applicability.

      4.7  Tax  and  Other  Liabilities.  (i)  Whitestone  has no  liability  or
obligation of any nature,  accrued or contingent,  including without  limitation
liabilities  for  federal,  state,  local,  or  foreign  taxes,  liabilities  to
customers  or  suppliers,   direct  or  indirect,   claims,   losses,   damages,
deficiencies  (including  deferred  income tax and other net tax  deficiencies),
costs, expenses, obligations, guarantees, or responsibilities,  whether accrued,
absolute,  or  contingent,  known or unknown,  fixed or unfixed,  liquidated  or
unliquidated,  secured or unsecured,  (hereinafter  collectively  referred to as
"Liabilities") other than the following:

      (a)   Liabilities for which full provision and/or disclosure has been made
            on the  audited  balance  sheet  (the  "Last  Balance  Sheet") as of
            December 31, 1996 (the "Last  Balance  Sheet  Date")  referred to in
            Section 4.5 of this Agreement; and

      (b)   Other liabilities  arising since the Last Balance Sheet and prior to
            the Closing  Date in the ordinary  course of business  which are not
            inconsistent with the  representations  and warranties of Whitestone
            or any other  provision  of this  Agreement.  To the extent that any
            other  liabilities  in excess of $3,000 have  arisen  since the Last
            Balance Sheet,  such other liabilities are described in Schedule 4.7
            annexed hereto.

(ii) Without  limiting the  generality of the  foregoing,  the amounts set up as
provisions  for taxes on the Last Balance Sheet are  sufficient  for all accrued
and unpaid federal, state, local and foreign taxes of Whitestone, whether or not
due and payable and whether or not disputed, under


                                       8
<PAGE>

tax laws, as in effect on the Last Balance Sheet Date or now in effect,  for the
period ended on such date and for all fiscal years prior thereto. Whitestone has
filed all federal tax returns required to be filed by them.  Whitestone has paid
(or has  established  on the  Last  Balance  Sheet a  reserve  for)  all  taxes,
assessments,  and other  governmental  charges  payable or  remittable  by it or
levied upon it or its properties,  assets,  income,  or franchises which are due
and payable.  Whitestone  has not received  reports as to  adjustments  from any
taxing  authority  during  the  past  five  years  and  Whitestone  knows  of no
governmental or other proceeding (formal or informal), or investigation pending,
threatened, or in prospect with respect to any such report or the subject matter
of any such report.

      4.8 Litigation and Claims.  There is no  litigation,  arbitration,  claim,
governmental or other proceeding (formal or informal), or investigation pending,
threatened,  or in  process  (or any basis  therefore  known to  Stockholder  or
Whitestone)  with  respect  to  Whitestone,  or any  of  its  or  his  business,
properties,  or assets except as disclosed on Schedule 4.8 attached.  Whitestone
is not affected by any present or threatened  strike or other labor  disturbance
nor to the  knowledge of  Whitestone,  is any union  attempting to represent any
employee of the Company as  collective  bargaining  agent.  Whitestone is not in
violation of, or in default with respect to, any law, rule,  regulation,  order,
judgment,  or decree; nor is Whitestone  required to take any action in order to
avoid such violation or default.

      4.9 Assets.  The  financial  statements  annexed  hereto as  Schedule  4.5
contain a true and complete list of all real and other  properties  and material
assets  (including  but not limited to machinery,  equipment,  inventories,  and
intangibles  owned,  leased,  used in its business and/or licensed by Whitestone
(collectively the "Assets"). The Assets constitute all such properties and


                                       9
<PAGE>

assets which are  necessary to conduct the business of  Whitestone  as presently
conducted and/or as Whitestone contemplates conducting.

      4.10 Title to Assets.  Whitestone has good and marketable  title to all of
the Assets (except real and other  properties and assets as are held pursuant to
leases as  referred  to in  Article  4.14  herein,  free and clear of all liens,
mortgages,  security interests,  pledges, charges,  conditional sales agreements
and  security  investments,  and  encumbrances  (except  as  are  listed  in the
financial statements attached to the Agreement as Schedule 4.5).

      4.11  Accounts and Notes  Receivable.  All  accounts and notes  receivable
reflected on the Last Balance  Sheet,  and those  arising since the Last Balance
Sheet Date constitute valid and binding obligations,  have been collected or are
and will be good and collectible, in each case at the aggregate recorded amounts
thereof  without  right  of  recourse,  defense,  deduction,  return  of  goods,
counterclaim,  offset,  or set  off on the  part  of the  obligor,  and,  if not
collected,  can  reasonably be anticipated to be paid within 60 days of the date
incurred.

      4.12 Lack of Restrictions.  No real property owned, leased,  licensed,  or
used by Whitestone  lies in an area which is, or to the knowledge of Whitestone,
will be,  subject to zoning,  use,  or  building  code  restriction  which would
prohibit,  and no state of facts  relating to the  actions of another  person or
entity or its  ownership,  leasing,  licensing,  or use of any real or  personal
property  exists or will exist  which would  prevent,  the  continued  effective
ownership,  leasing,  licensing, or use of such real property in the business in
which  Whitestone  is now  engaged  or the  business  in which  it  contemplates
engaging.

      4.13  Contracts and Other  Instruments.  (i) Schedule 4.13  accurately and
completely details all contracts,  licenses, instruments and agreements to which
Whitestone is a party,


                                       10
<PAGE>

including  but  not  limited  to,  all  telephone  agency   agreements,   supply
agreements,    manufacturer    agreements,    price    protection    agreements,
distributorship agreements, OEM agreements,  partnership agreements,  dealership
agreements,  fiduciary  agreements,  license agreements,  marketing  agreements,
commission agreements,  sales agency agreements,  other agency agreements,  bank
credit agreements, factoring agreements, loan agreements, indentures, promissory
notes,  guarantees,  undertakings,  other evidences of indebtedness,  letters of
credit, joint venture agreements,  operating agreements,  management agreements,
agreements for the acquisition of merger or combination  with any other company,
corporation  or  businesses  signed  within  the  last  two  years,   employment
agreements,  labor  agreements,  salesmen  commission  agreements,   independent
contractor agreements,  sales or purchase agreements for a term in excess of one
year  which  have an  aggregate  sale or  purchase  price in excess of  $50,000;
contracts, agreements, arrangements, or understandings with any stockholder, any
director, officer, or employee, any relatives or affiliate of any stockholder or
of any  such  director,  officer,  or  employee,  or any  other  corporation  or
enterprise in which any stockholder, any such director, officer, or employee, or
any such  relative or  affiliate  then had or now has a 5% or greater  equity or
voting  or  other  substantial   interest;   government   contracts,   franchise
agreements,  management agreements, advisory agreements,  consulting agreements,
advertising  agreements,   construction   agreements,   warehousing  agreements,
engineering  agreements,  design  agreements,  major utility  agreements and any
other  agreements which involve the payment of in excess of $50,000 prior to the
date it can be terminated  without  penalty or premium (all of which  contracts,
licenses,  instruments,  and agreements are hereinafter referred to collectively
as the "Contracts").


                                       11
<PAGE>

      (ii) Neither  Whitestone nor any other party to any such Contract,  to the
best  of  Whitestone's  knowledge,  is now or  expects  in the  future  to be in
violation  or breach  of, or in default  with  respect to  complying  with,  any
material provision thereof, and each such Contract,  is in full force and effect
and is the legal,  valid,  and binding  obligation of the parties thereto and is
enforceable  as to them in  accordance  with  their  respective  terms.  Neither
Whitestone  nor any  other  party to any  such  Contract  has  given  notice  of
termination or taken any action inconsistent with the continuance  thereof.  The
execution,  delivery,  and  performance of this Agreement will not prejudice any
such  Contract.  Whitestone  is not  party to or bound  by any  other  contract,
agreement, instrument, lease, license, arrangement, or understanding, or subject
to any charter or other  restriction,  which has had or may in the future have a
material  adverse  effect on the  financial  condition,  results of  operations,
business, properties, assets, liabilities, or future prospects of Whitestone.

      4.14 Leases.  Schedule 4.14 attached hereto  describes all of Whitestone's
leases and  subleases  to which  Whitestone  is a party  ("Leases").  Whitestone
enjoys  peaceful and  undisturbed  possession  under all such  leases.  All such
Leases are legal,  valid and binding  agreements  and  Whitestone is a tenant or
possessor in good standing thereunder,  free of any default or breach whatsoever
and quietly enjoys the premises  provided for therein.  Each rental,  royalty or
other payment due  thereunder  has been made;  each act required to be performed
which,  if not performed,  would  constitute a material  breach thereof has been
duly performed;  and no prohibited acts have been performed thereunder which, if
presented, would constitute a material breach thereof. Each of such leases is in
full force and effect and there is not under


                                       12
<PAGE>

any such lease any default or claim of default or event which, with or without
notice of the lapse of time or both would constitute a breach or default
thereunder.

      4.15 Capital  Projects.  As of the date of this Agreement,  Whitestone has
not undertaken any capital projects the cost of completion of which would exceed
$3,000 except as listed in Schedule 4.15 attached hereto and made a part hereof.

      4.16  Environmental  Laws.  Whitestone is in material  compliance with all
federal, state and local laws regarding environmental matters.

      4.17 ERISA Matters.  Whitestone  does not have, nor does it contribute to,
any pension, profit sharing,  option, other incentive plan, or any other type of
employee  benefit plan (as defined in Section  3(3) of the  Employee  Retirement
Income Security Act of 1974), or any obligation to or customary arrangement with
employees for bonuses, incentive compensation, or severance pay.

      4.18 Insurance.  Schedule 4.18 attached hereto and made a part hereof is a
complete  and  correct  list  of all  insurance  policies  of any  kind  held by
Whitestone.  Each such policy is valid and  enforceable;  all premiums and other
payments due from Whitestone on account of any such policy have been paid, there
is no act or  failure  to act  which has or might  cause  any such  policy to be
canceled or terminated.

      4.19 Labor Disputes. Whitestone is not a party to any union representation
or labor  contract.  Whitestone has not received any notice from any labor union
or group of employees that such union or group  represents or believes or claims
it represents or intends to represent  any of the  employees of  Whitestone;  no
strike  or  work  interruption  by  any  of  its  employees  is  planned,  under
consideration, threatened or imminent; and Whitestone has not made any loan


                                       13
<PAGE>

or given anything of value,  directly or indirectly,  to any officer,  official,
agent or representative of any labor union or group of employees.  Whitestone is
not  delinquent  in payments to any of its  employees  for any wages,  salaries,
commissions,  bonuses or other direct compensation for any services performed by
them to the date hereof or amounts  required to be reimbursed to such employees.
In the  event  of  termination  of  the  employment  of  any  of its  employees,
Whitestone  will not by reason of  anything  done prior to the  Closing  Date be
liable to any of said  employees  for  "severance  pay" or any  other  payments.
Whitestone  is in  compliance  with  all  federal,  state  and  local  laws  and
regulations  respecting  labor,  employment and wages and hours; and there is no
unfair labor practice  complaint against  Whitestone pending before the National
Labor Relations Board or any comparable state or local agency.

      4.20  Liens on  Assets.  Except as  reflected  on  Whitestone's  financial
statements (Schedule 4.5) Whitestone has good and marketable title to all of its
assets  and such  assets  are not  subject  to any  mortgages,  pledges,  liens,
conditional  sales  agreements,  encumbrances  and security  interests or claims
except  for  minor  imperfections  in  title  and  encumbrances,  if any,  which
singularly  and in the  aggregate  are  not  substantial  in  amount  and do not
materially  detract from the value of the property subject thereto or impair the
use thereof in Whitestone's business.

      4.21  Condition  of  Tangible  Assets.  As of  the  Closing  Date,  all of
Whitestone's  assets will be in normal,  operating and useable  condition,  in a
state of good  maintenance  and repair,  subject to  ordinary  wear and tear and
scheduled  maintenance items,  taking into consideration the age and utilization
thereof,  and will conform to all applicable  ordinances,  regulations and other
laws  (including  those  relating  to  building  and  zoning  and  environmental
protection and occupational safety and health).


                                       14
<PAGE>

      4.22 Validity of Contemplated  Transactions.  The execution,  delivery and
performance  of  this  Agreement  and  the   consummation  of  the  transactions
contemplated  hereby (i) have been duly approved by the unanimous consent of the
Board of Directors of Whitestone;  (ii) do not and will not contravene,  violate
and/or result in a breach or default under any provision of the  Certificate  of
Incorporation  or  Bylaws of  Whitestone  as  presently  in  effect;  (c) do not
violate,  are not in conflict with,  and do not  constitute a default under,  or
cause the acceleration of any payments pursuant to, or otherwise impair the good
standing,  validity,  or  effectiveness  of any  material  agreement,  contract,
license, indenture, instrument, lease, or mortgage, or subject Whitestone or any
of its assets to any indenture,  mortgage,  contract,  commitment, or agreement,
other than this Agreement, to which Whitestone is a party or by which Whitestone
or any of its assets are bound; and (d) does not violate any material  provision
of law,  rule,  regulation,  order,  permit,  or license to which  Whitestone is
subject.

      4.23  Subsidiaries.  Whitestone  owns no shares of capital  stock or other
equity interest in any corporation, partnership, joint venture or other business
organization  or  enterprise,  except as set forth in the  financial  statements
included in Schedule 4.5 annexed hereto.

      4.24 Bank  Accounts.  Schedule  4.24  annexed  hereto  lists the names and
addresses  of every bank and other  financial  institution  in which  Whitestone
maintains an account (whether checking, savings or otherwise),  lock box or safe
deposit  box,  and the  account  numbers  and names of  persons  having  signing
authority or other access thereto.

      4.25 Questionable  Payments.  Neither Whitestone,  any director,  officer,
agent,  employee,  or other  person  associated  with or  acting  on  behalf  of
Whitestone  has,  directly  or  indirectly:  (i) used any  corporate  funds  for
unlawful contributions, gifts, entertainment, or other


                                       15
<PAGE>

unlawful payment to foreign or domestic  governmental  officials or employees or
to foreign or domestic  governmental  officials  or  employees  or to foreign or
domestic  political parties or campaigns from corporate funds; (ii) violated any
provision of the Foreign  Corrupt  Practices Act of 1977;  (iii)  established or
maintained any unlawful or unrecorded fund of corporate  monies or other assets;
(iv) made any false or fictitious  entry on the books or records of  Whitestone;
(v) made any  bribe,  rebate,  payoff,  influence  payment,  kickback,  or other
unlawful  payment;  (vi)  given any favor or gift  which is not  deductible  for
federal income tax purposes;  and/or (viii) made any bribe,  kickback,  or other
payment of a similar or comparable nature,  whether lawful or not, to any person
or entity, private or public, regardless of form, whether in money, property, or
services,  to obtain  favorable  treatment  in  securing  business  or to obtain
special  concessions,  or to pay for favorable treatment for business secured or
for special concessions already obtained.

      4.26  Directors and  Officers.  A true and complete list as of the date of
this Agreement indicating  Whitestone's directors and officers, each of whom has
been duly elected is as follows:

      NAME                               POSITION
      ----                               --------

      Donald Yu                          President, Chief Executive and Director

      Geoge Eshoo                        Secretary, Treasurer and Director

      Marianne Rossi                     Asst. Secretary

      4.27 Liabilities.  The financial statements annexed hereto as Schedule 4.5
reflect a true and complete list of all Whitestone bank loans,  lines of credit,
financial  institution  indebtedness  and other  liabilities  (including but not
limited to accounts payable and accrued expenses)  outstanding as of the date of
this Agreement, which schedule includes the name of the creditor,


                                       16
<PAGE>

amount  outstanding  as of the date of this  Agreement and  essential  repayment
terms and conditions.

      4.28 Public Company. The Common Stock of the Whitestone is registered with
the United States Securities and Exchange Commission ("SEC") pursuant to Section
12(g) of the Securities  Exchange Act of 1934 ("Exchange  Act").  The Company is
not  current  with  respect to its filing  obligations  to the  Commission  as a
"reporting  company." It has filed all required reports but for Forms 10-QSB for
the  quarterly  periods ended  September  30, 1996 and March 31, 1997,  and Form
10-KSB for the year ended  December  31, 1996.  To the best of the  Whitestone's
knowledge  and  belief,   there  are  no  pending  or  foreseeable   enforcement
proceedings or  investigations  relative to the Company  commenced by either the
SEC or any state securities bureau.

                                    ARTICLE 5

                            COVENANTS OF THE COMPANY

      5. Covenants of the Company. The Company covenants as follows:

      5.1 The  representations  and warranties of the Company  contained in this
Agreement and in the schedules  hereto shall be true and correct in all respects
as of the Closing Date. The Company shall give  Whitestone  prompt notice of any
change in any of the information contained in the representations and warranties
of the Company,  the schedules hereto or the documents  furnished by the Company
in  connection  herewith  which  occurs  prior  to the  Closing  Date.  Upon the
happening of any occurrence or event prior to the Closing Date, which shall have
a material adverse effect upon the business or assets of the Company, Whitestone
shall have the right to


                                       17
<PAGE>

terminate  this  Agreement  by  written  notice  to the  Company  and upon  such
termination,  no party shall have any further liability or obligation under this
Agreement.

      5.2 The Company  shall,  prior to the Closing Date,  deliver to Whitestone
the  unanimous  consent of its Board of Directors,  which consent  evidences the
approval of this Agreement and the transactions contemplated hereby.

      5.3 The  Company  will,  prior to the Closing  Date,  comply with all laws
affecting  operation of its business,  will not operate the said business  other
than in the ordinary course,  and will give notice to Whitestone of any event or
circumstance  not in the ordinary course which  materially  affect the Company's
business or the Assets.

      5.4 The  Company  shall use its best  efforts to take or cause to be taken
all action and do or cause to be done all things necessary,  proper or advisable
to  consummate  the  transactions  contemplated  by this  Agreement,  including,
without  limitation,  to obtain all consents,  approvals and  authorizations  of
third  parties,  to make all filings with and give all notices to third  parties
which may be  necessary  or required  in order to  effectuate  the  transactions
contemplated  hereby  and to provide  all  information  necessary  to enable the
Company  to meet  its  disclosure  responsibilities  to the  SEC,  NASD  and the
investment community.

                                    ARTICLE 6

                     COVENANTS OF WHITESTONE AND STOCKHOLDER

      Whitestone and Stockholder covenant as follows:

      6.1 The  representations  and  warranties  of Whitestone  and  Stockholder
contained in this Agreement  shall be true and correct in all material  respects
as of the  Closing  Date,  and  Whitestone  and the  Stockholder  shall give the
Company prompt notice of any change in any of


                                       18
<PAGE>

the information  contained in the  representations  and warranties of Whitestone
and Stockholder hereunder or the documents furnished by Whitestone in connection
herewith which occurs prior to the Closing Date.

      6.2  Whitestone  will use its best efforts to, prior to the Closing  Date,
comply with all laws affecting the operation of its business.

      6.3 Whitestone shall use its best efforts to take or cause to be taken all
action and do or cause to be done all things  necessary,  proper or advisable to
consummate the transactions contemplated by this Agreement,  including,  without
limitation,  to obtain  all  consents,  approvals  and  authorizations  of third
parties and to make all filings with and give all notices to third parties which
may  be  necessary  or  required  in  order  to  effectuate   the   transactions
contemplated hereby.

                                    ARTICLE 7

                              CONDITIONS OF CLOSING

      7.1 The obligation of the Company to close  hereunder  shall be subject to
the fulfillment and satisfaction by Stockholder and/or  Whitestone,  prior to or
at the Closing Date, of the following  conditions or the written  waiver thereof
by the Company:

      (i) Board Meeting. Whitestone's Board of Directors shall have approved all
      of the  transactions  described  in this  Agreement  by  either  a vote or
      written  consent of the  majority  of Board  members,  and a  majority  of
      Whitestone's  stockholders  shall have  executed  consents  approving  the
      transactions  contemplated  by this Agreement.  At the Board meeting,  the
      outgoing Board of Directors shall adopt the following resolutions:


                                       19
<PAGE>

            a) A recapitalization of Whitestone  including a reverse stock split
      of Whitestone's Common Stock in a ratio requested by the Company;

            b) Designation of incoming directors;

            c) Resignation of outgoing directors,  effective as soon as past due
      reports on Forms 10-QSB and Form 10-KSB have been filed with the SEC;

            d)  Declaration  of a stock  dividend of 5% of Golden's  outstanding
      common stock to be distributed to  Whitestone's  shareholders of record on
      the day preceding the Closing Date'

            e) Amendment of Whitestone's Certificate of Incorporation to provide
      for the  aforementioned  reverse  split  and to  effect a name  change  to
      Proformix, Inc.; and

            f) Approval of the filing of Registration Statement on Form S-8 with
      respect to shares to be issued to consultants Seymour Kroll and Carl Henn.
     
      (ii) Representations and Warranties.  The representation and warranties of
      Whitestone and the Stockholder in this Agreement shall be true and correct
      in all  material  respects  when made and shall be true and correct in all
      material respects on and as of the Closing Date.

      (iii)  Reporting  Obligations.  Whitestone  shall  file  with  the SEC all
      delinquent Exchange Act reports including, but not limited to, Form 10-QSB
      for the quarter ended  September 30, 1996,  Form 10-KSB for the year ended
      December 31, 1996,  and Form 10-QSB for the quarter  ended March 31, 1997.
      The outgoing Board of Directors will be responsible for the filing of such
      delinquent reports.


                                       20
<PAGE>

      (iv)  Delivery  of  Officers'   Certificate.   A  certificate   signed  by
      Whitestone's CEO shall be delivered to the Company certifying that each of
      the  warranties and  representations  set forth in this Agreement are true
      and  accurate  as of the  date of the  Closing  Date  and that no event or
      occurrence  has transpired as of the Closing Date which has or will have a
      material  adverse effect upon the business or assets being  acquired.  

      (v)  Compliance  with  Agreement.  Whitestone  shall  have  performed  and
      complied with all of its covenants and  obligations  under this  Agreement
      and the  Letter  of Intent  dated May 15,  1997,  and  Whitestone  and the
      Stockholder  further  specifically agree to file all required Exchange Act
      reports,  issue all shares of stock, including issuance to the Stockholder
      of all the outstanding capital stock of Golden, less the 5% stock dividend
      provided  for  hereinabove,  and to  perform  and  comply  with all  other
      covenants and obligations  which are to be discharged  after the effective
      date hereof as set forth hereunder.

      (vi) Absence of Suit. No action,  suit or proceedings  before any court or
      any  governmental  or regulatory  authority  shall have been  commenced or
      threatened  and,  no  investigation  by  any  governmental  or  regulatory
      authority  shall  have  been  commenced  against   Whitestone  seeking  to
      restrain,  prevent  or change the  transactions  contemplated  hereby,  or
      questioning the validity or legality of any such transactions,  or seeking
      damages in connection with any of such transactions.


                                       21
<PAGE>

      (vii) Receipt of Approvals,  Etc. All approvals,  consents  and/or waivers
      for Whitestone that are necessary to effect the transactions  contemplated
      hereby shall have been received.

      (viii) Accuracy of Financial Statements. All balance sheets, statements of
      income,  statements of changes in financial position and/or cash flows and
      other financial statements of Whitestone furnished to the Company pursuant
      to this Agreement shall be true,  accurate and prepared in accordance with
      generally accepted accounting principles.
                   
      (ix)   Proceedings  and  Instruments   Satisfactory;   Certificates.   All
      proceedings,  corporate or otherwise,  to be taken in connection  with the
      transactions  contemplated  by this Agreement  shall have occurred and all
      appropriate  documents  incident  thereto as the  Company  may  reasonably
      request shall have been delivered to the Company.

      (x) Opinion of Counsel.  Whitestone shall produce an opinion of counsel as
      of the Closing  Date  addressed to the Company to the effect that (i) this
      Agreement has been duly  executed and delivered by Whitestone  and the and
      constitutes  a legal,  binding  obligation of  Whitestone  and  Stocholder
      enforceable in accordance  with its terms;  (ii)  Whitestone has taken all
      action  necessary to  authorize  the  execution  and  performance  of this
      Agreement;  and (iii)  that the  Whitestone  Shares  are duly  authorized,
      validly issued, fully paid and non-assessable.


                                       22
<PAGE>

      7.2 The  obligation of Whitestone to close  hereunder  shall be subject to
the  fulfillment  and  satisfaction,  prior to or at the  Closing  Date,  of the
following  conditions  by the  Company  or the  written  waiver  thereof  by the
Whitestone:

      (i) Representatives  and Warranties.  The representation and warranties of
      the Company in this  Agreement  shall be true and correct in all  material
      respects when made and shall be true and correct in all material  respects
      on and as of the Closing Date.

      (ii) Delivery of Officers'  Certificate.  The Company shall deliver to the
      Company  a  certificate  signed  by its CEO,  certifying  that each of the
      warranties and  representations of the Company set forth in this Agreement
      is true and  accurate as of the date of the Closing Date and that no event
      or occurrence has transpired as of the Closing Date which has or will have
      a material adverse effect upon the business or assets being acquired.

      (iii)  Compliance  with  Agreement.  The Company shall have  performed and
      complied with materially all of their obligations and delivered all monies
      to the  Stockholder  required to be delivered under this Agreement and the
      Letter of Intent dated May 15, 1997.

      (iv)  Absence  of Suit.  No action or lawsuit  shall  have been  commenced
      against  the  Company,   seeking  to  restrain,   prevent  or  change  the
      transactions  contemplated hereby, or questioning the validity or legality
      of any such  transactions,  or seeking  damages in connection  with any of
      such transactions.


                                       23
<PAGE>

      (v) Receipt of Approvals, Etc. All approvals,  consents and/or waivers for
      the Company  that are  necessary to effect the  transactions  contemplated
      hereby shall have been received.

      (vi)   Proceedings  and  Instruments   Satisfactory;   Certificates.   All
      proceedings,  corporate or otherwise,  to be taken in connection  with the
      transactions  contemplated  by this Agreement  shall have occurred and all
      appropriate  documents  incident  thereto  as  Whitestone  may  reasonably
      request shall have been delivered to Whitestone.

                                    ARTICLE 8

                                 INDEMNIFICATION

      8.1 By the Company.  The Company  shall defend and promptly  indemnify and
save Whitestone and the Stockholder  harmless from, against,  for and in respect
of and shall pay any and all damages, losses, obligations,  liabilities, claims,
encumbrances,  deficiencies,  costs and expenses, including, without limitation,
reasonable  attorneys' fees and other costs and expenses incident to any action,
investigation,  claim or proceeding (all hereinafter collectively referred to as
"Losses") suffered, sustained, incurred or required to be paid by Whitestone and
the   Stockholder   by  reason  of  the   Company's   breach  of  any  warranty,
representation or covenant hereunder.

      8.2 By  Whitestone.  Whitestone  shall defend and promptly  indemnify  the
Company and its officers and  directors,  and save and hold them harmless  from,
against,  for and in  respect  of and  shall  pay any and all  damages,  losses,
obligations,   liabilities,   claims,  encumbrances,   deficiencies,  costs  and
expenses, including without limitation, reasonable attorneys' fees and


                                       24
<PAGE>

other costs and expenses incident to any suit, action,  investigation,  claim or
proceeding  (all  hereinafter  collectively  referred to as "Losses")  suffered,
sustained,  incurred  or required to be paid by the Company by reason of (i) the
existence of any and all obligations and/or liabilities of Whitestone which were
not  disclosed to the Company in this  Agreement;  (ii) any breach or failure of
observance or performance of any representation,  warranty,  covenant, agreement
or  commitment  made by  Whitestone  and the  Stockholder  hereunder or relating
hereto or as a result of any such representation,  warranty, covenant, agreement
or  commitment  being untrue or  incorrect in any respect,  or (iii) any and all
actions,  suits,  investigations,  proceedings,  demands,  assessments,  audits,
judgments  and  claims  arising  out  of  any  of  the  foregoing  or  from  any
misrepresentation or omission from any schedule to this Agreement, certificates,
financial  statements or from any document furnished or required to be furnished
hereunder.

                                    ARTICLE 9

                                    EXPENSES

      9.1 Expenses. The parties agree to bear their expenses individually,  each
in respect of all expenses of any character  incurred by it in  connection  with
this Agreement or the transactions contemplated hereby.

                                   ARTICLE 10

                            SECURITIES ACT PROVISIONS

      10.1  Restrictions  on Disposition of Shares.  The Company and Stockholder
covenants  and  warrants  that the  Whitestone  Shares  and the  Golden  Shares,
respectively, to be received from the Stockholder and Whitestone,  respectively,
pursuant to this  Agreement are acquired for their own  respective  accounts and
not with the present view towards the distribution thereof


                                       25
<PAGE>

without  compliance  with  securities  laws and they  will  not  dispose  of the
Whitestone  Shares  and  Golden  Shares  except  (i)  pursuant  to an  effective
registration  statement under the Securities Act of 1933, as amended, or (ii) in
any other transaction which, in the opinion of Whitestone's or Golden's counsel,
as the case may be, is exempt  from  registration  under the  Securities  Act of
1933, as amended,  or the rules and regulations of the SEC thereunder.  In order
to effectuate the covenants of this  subsection  10.1 an appropriate  legend has
been  be  placed  upon  each  of  the  certificates  of  stock  at the  time  of
distribution  of  the  Whitestone  and  Golden  Shares  by the  Stockholder  and
Whitestone pursuant to this Agreement,  and stop transfer  instructions shall be
placed with the transfer agent for said Shares.

      10.2  Evidence  of  Compliance  with  Private  Offering   Exemption.   The
Stockholder  agrees to supply the Company with such  evidence as counsel for the
Company may require in order to evidence the private  offering  character of the
distribution of shares made pursuant to this Agreement.

      10.3  Notice  of  Limitation  Upon   Disposition.   The  Company  and  the
Stockholder  is aware that the Whitestone  Shares and Golden Shares  distributed
pursuant  to this  Agreement  will  not have  been  registered  pursuant  to the
Securities Act of 1933, as amended, and therefore, under current interpretations
and  applicable  rules,  said Shares can not be publicly sold for a period of at
least one year,  and at the  expiration  of such one year period,  sales of said
Shares may be confined to brokerage  transactions of limited  amounts  requiring
certain  notification filings with the SEC and such disposition may be available
only if Whitestone  are current in its filings with the SEC under the Securities
Act of 1933, as amended, or other public disclosure requirements.


                                       26
<PAGE>

                                   ARTICLE 11

                            MISCELLANEOUS PROVISIONS

      11.1 Entire  Agreement.  This Agreement and the Letter of Intent dated May
15, 1997  constitutes  the entire  agreement  of the parties with respect to the
subject matter hereof.The representations,  warranties, covenants and agreements
set  forth in this  Agreement  and in any  financial  statements,  schedules  or
exhibits   delivered   pursuant  hereto  constitute  all  the   representations,
warranties,  covenants and  agreements of the parties  hereto and upon which the
parties  have  relied  and except as may be  specifically  provided  herein.  No
change,  modification,  amendment,  addition or termination of this Agreement or
any part thereof  shall be valid unless in writing and signed by or on behalf of
the party to be charged therewith.

      11.2  Survival of  Covenants,  etc. All  warranties,  representations  and
covenants set forth herein shall survive the Closing Date of this Agreement.

      11.3 Notices.  Any and all notices or other  communications  or deliveries
required or permitted to be given or made  pursuant to any of the  provisions of
this Agreement  shall be deemed to have been duly given or made for all purposes
if sent by Federal Express delivery or by certified or registered  mail,  return
receipt requested and postage prepaid or hand delivered as follows:

             For the Company:

             Royal Capital, Inc.
             75 Claremont Road
             Bernardsville, NJ 07924

             Copy to:

             Silverman, Collura, Chernis & Balzano. P.C
             381 Park Avenue Suite, Suite 1601


                                       27
<PAGE>

             New York, New York  10016

             For Stockholder:

             6363 Christie Avenue
             Emeryville, California 94608

      11.4 Waiver.  No waiver of the provisions hereof shall be effective unless
in writing  and signed by the party to be charged  with such  waiver.  No waiver
shall be deemed a  continuing  waiver or waiver  in  respect  of any  subsequent
breach or default,  either of a similar or different nature, unless expressly so
stated in writing.

      11.5  Governing  Law. This Agreement  shall be governed,  interpreted  and
construed in  accordance  with the laws of the State of New York  applicable  to
contracts to be  performed  entirely  within that State.  Any dispute in any way
related to the subject matter of this Agreement  shall be litigated  exclusively
within the State of New York and all parties hereto,  including  shareholders of
the  Company  consent to the  jurisdiction  of the State  and/or  United  States
District  Courts  of New  York.  Should  any  clause,  section  or  part of this
Agreement  be held or declared  to be void or illegal for any reason,  all other
clauses,  sections or parts of this Agreement which can be affected without such
illegal clause,  section or part shall  nevertheless  continue in full force and
effect.

      11.6  Successors  and Assigns.  This  Agreement  shall be binding upon and
inure to the benefit of the parties hereto and their  respective  successors and
assigns or heirs and personal representatives;  provided, however, that no party
may assign any of its rights or delegate any of its duties under this  Agreement
without the prior written consent of the other parties hereto.


                                       28
<PAGE>

      11.7  Captions.  The  headings,  captions  or titles of  paragraphs  under
sections or subsections of this Agreement are for convenience and reference only
and do not in any way modify, interpret or construe the intent of the parties or
effect any of the provisions of this Agreement.

      11.8 Time Periods.  Any time period provided for herein which shall end or
expire on a Saturday,  Sunday,  or legal holiday shall be deemed extended to the
next full business day thereafter.

      11.9  Counterparts.  This  Agreement  may  be  executed  in  one  or  more
counterparts,  each of which shall be deemed to be an original, but all of which
shall constitute one and the same Agreement.

      11.10  Confidentiality.  Neither this Agreement nor any memorandum of this
Agreement  shall be recorded in the Public  Records of any State or County.  The
parties  hereto  agree  to  keep  this  Agreement  confidential,  as well as any
information  or  document  obtained  by  either  party in  connection  with this
transaction, except to the extent disclosure is required to or by any government
agency or regulatory or quasi-regulatory  body.  Whitestone will not release any
information by press release or otherwise regarding this transaction without the
prior consent of the Company.


                                       29
<PAGE>

      11.11 Joint  Draftsmanship.  The  preparation of this Agreement has been a
joint effort of the parties and this Agreement  shall not, solely as a matter of
judicial  construction,  be construed  more severely  against one of the parties
than the other.

      IN WITNESS  WHEREOF,  the parties  hereto have caused this Agreement to be
signed on the date and year first above written.

                                           ROYAL CAPITAL INCORPORATED       
                                        
                                           By:_____________________________
                                                Bruce Deichl, President
                                        
                                           WHITESTONE INDUSTRIES, INC.
                                        
                                           By:_____________________________
                                                 Donald R. Yu, President
                                        
                                           ________________________________
                                               Donald R. Yu, Individually
                                        
<PAGE>

1. Article 1.1(i) is amended as follows:

     (i) The Stockholder shall sell, assign,  transfer and convey to the Company
     at the Closing Date (as  hereinafter  defined),  or as soon  thereafter  as
     practicable,  100,000 shares of Whitestone  Series A Preferred Stock,  $.01
     par  value  ("Preferred  Stock").  The  Stockholder  shall  arrange  for an
     irrevocable proxy to be executed by a Whitestone  shareholder providing the
     Company  with sole voting power of 1,120,000  shares of  Whitestone  Common
     Stock,  $.0001 par value ("Common  Stock") (the Preferred  Stock and Common
     Stock  collectively  referred to herein at the  "Whitestone  Shares").  The
     Stockholder shall deliver at the Closing Date certificates representing the
     Preferred  Stock duly endorsed in blank or accompanied by stock powers duly
     endorsed  in  blank,  in each  case  in  proper  form  for  transfer,  with
     signatures  guaranteed as reasonably  requested by the Company and with all
     stock transfer and other required  documentary stamps affixed thereto.  The
     Stockholder shall also deliver at the Closing Date an executed  irrevocable
     proxy pursuant to the terms described above.

                                            ROYAL CAPITAL INCORPORATED
                                    
                                            By:____________________________
                                                 Bruce Deichl, President
                                    
                                    
                                            WHITESTONE INDUSTRIES, INC.
                                    
                                            By:____________________________
                                                   Donald Yu, President
                                    
                                    
                                              _____________________________
                                                  Donald Yu, Individually

<PAGE>

1.  Article  1.1(ii)  is  amended  to  provide  for the escrow of $60,000 of the
purchase  price,  to be released to  Stockholder  upon the  satisfaction  of the
following conditions:

          (a) The Stockholder will provide the litigation  documents relating to
     the  injunction  and stop  transfer  instructions  pertaining  to 1,120,000
     shares  of  Whitestone  Industries,  Inc.  Common  Stock  held or record by
     Stockholder; and

          (b) The  filing  of all  delinquent  Securities  Exchange  Act of 1934
     reports by Stockholder as described in Article 4.28.

                                            ROYAL CAPITAL INCORPORATED
                                    
                                            By:____________________________
                                                 Bruce Deichl, President
                                    
                                    
                                            WHITESTONE INDUSTRIES, INC.
                                    
                                            By:____________________________
                                                   Donald Yu, President
                                    
                                    
                                              _____________________________
                                                  Donald Yu, Individually