STOCK EXCHANGE
                                    AGREEMENT
                                   Quade, Inc.
                                    (Company)



                   American Resources and Development Company
                                     (Buyer)



                                  July 9, 1998
                                     (Date)

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                               TABLE OF CONTENTS

1. DEFINITIONS ...........................................................  1
"Acquired Companies" .....................................................  1
"Adjustment Amount" ......................................................  1
"Applicable Contract" ....................................................  1
"Asking Price" ...........................................................  1
"Average Asking Price" ...................................................  2
"Balance Sheet" ..........................................................  2
"Best Efforts" ...........................................................  2
"Breach" .................................................................  2
"Buyer" ..................................................................  2
"Closing" ................................................................  2
"Closing Date" ...........................................................  2
"Company" ................................................................  2
"Consent" ................................................................  2
"Contemplated Transactions" ..............................................  2
"Contract" ...............................................................  3
"Damages" ................................................................  3
"Disclosure Letter" ......................................................  3
"Employment Agreements" ..................................................  3
"Encumbrance" ............................................................  3
"Environment" ............................................................  3
"Environmental, Health, and Safety Liabilities" ..........................  3
"Environmental Law" ......................................................  4
"ERISA" ..................................................................  4
"Facilities" .............................................................  5
"Fiscal Year" ............................................................  5
"Governmental Authorization" .............................................  5
"Governmental Body" ......................................................  5
"Hazardous Activity" .....................................................  5
"Hazardous Materials"  ...................................................  5
"Intellectual Property Assets" ...........................................  5
"IRC" ....................................................................  6
"IRS" ....................................................................  6
"Knowledge" ..............................................................  6
"Legal Requirement" ......................................................  6
"Net Income" .............................................................  6
"Occupational Safety and Health Law" .....................................  6
"Order" ..................................................................  6
"Ordinary Course of Business" ............................................  6
"Organizational Documents" ...............................................  7
"Person" .................................................................  7
"Proceeding" .............................................................  7
"Related Person" .........................................................  7
"Release" ................................................................  8
"Representative" .........................................................  8
"Securities Act" .........................................................  8
"Seller" .................................................................  8
"Seller's Release" .......................................................  8
"Shares" .................................................................  8
"Subsidiary" .............................................................  8
"Tax Return" .............................................................  9
"Threat of Release" ......................................................  9
"Threatened" .............................................................  9

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2. SALE AND TRANSFER OF SHARES; CLOSING ..................................  9
2.1    Shares ............................................................  9
2.2    Purchase Price ....................................................  9
2.3    Additional Consideration ..........................................  9
2.4    Loan Commitment ................................................... 10
2.5    Closing ........................................................... 11
2.6    Closing Obligations ............................................... 11

3. REPRESENTATIONS AND WARRANTIES OF SELLER .............................. 12
3.1    Organization and Good Standing .................................... 12
3.2    Authority; No Conflict ............................................ 12
3.3    Capitalization .................................................... 13
3.4    Financial Statements .............................................. 13
3.5    Books and Records ................................................. 13
3.6    Title to Properties; Encumbrances ................................. 14
3.7    Condition and Sufficiency of Assets ............................... 14
3.8    Accounts Receivable ............................................... 14
3.9    Inventory ......................................................... 15
3.10   No Undisclosed Liabilities ........................................ 15
3.11   Taxes ............................................................. 15
3.12   No Material Adverse Change ........................................ 16
3.13   Employee Benefits ................................................. 16
3.14   Compliance with Legal Requirements; Governmental Authorizations ... 16
3.15   Legal Proceedings; Orders ......................................... 18
3.16   Absence of Certain Changes and Events ............................. 19
3.17   Contracts; No Defaults ............................................ 20
3.18   Insurance ......................................................... 22
3.19   Environmental Matters ............................................. 23
3.20   Employees ......................................................... 25
3.21   Labor Relations; Compliance ....................................... 26
3.22   Intellectual Property ............................................. 26
3.23   Certain Payments .................................................. 29
3.24   Disclosure ........................................................ 29
3.25   Relationships with Related Persons ................................ 30
3.26   Brokers or Finders ................................................ 30

4. REPRESENTATIONS AND WARRANTIES OF BUYER ............................... 30
4.1    Organization and Good Standing .................................... 30
4.2    Authority; No Conflict ............................................ 30
4.3    Investment Intent ................................................. 31
4.4    Certain Proceedings ............................................... 31
4.5    SEC Filings ....................................................... 31
4.6    Brokers or Finders ................................................ 31

5. COVENANTS OF SELLER PRIOR TO CLOSING DATE ............................. 32
5.1    Access and Investigation .......................................... 32
5.2    Operation of the Businesses of the Acquired Companies ............. 32
5.3    Negative Covenant ................................................. 32
5.4    Required Approvals ................................................ 32
5.5    Notification ...................................................... 33
5.6    Payment of Indebtedness by Related Persons ........................ 33
5.7    No Negotiation .................................................... 33
5.8    Best Efforts ...................................................... 33

6. COVENANTS OF BUYER PRIOR TO CLOSING DATE .............................. 33
6.1    Approvals of Governmental Bodies .................................. 33
6.2    Best Efforts ...................................................... 33

<PAGE>

7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE ................... 34
7.1    Accuracy of Representations ....................................... 34
7.2    Seller's Performance .............................................. 34
7.3    Consents .......................................................... 34
7.4    Additional Documents .............................................. 34
7.5    No Proceedings .................................................... 34
7.6    No Claim Regarding Stock Ownership or Sale Proceeds ............... 35
7.7    No Prohibition .................................................... 35

8. CONDITIONS PRECEDENT TO SELLER OBLIGATION TO CLOSE .................... 35
8.1    Accuracy of Representations ....................................... 35
8.2    Buyer's Performance ............................................... 35
8.3    Consents .......................................................... 35
8.4    Additional Documents .............................................. 35
8.5    No Injunction ..................................................... 36

9. TERMINATION ........................................................... 36
9.1    Termination Events ................................................ 36
9.2    Effect of Termination ............................................. 36

10. INDEMNIFICATION; REMEDIES ............................................ 36
10.1   Survival; Right to Indemnification Not Affected by Knowledge ...... 36
10.2   Indemnification and Payment of Damages by Seller .................. 37
10.3   Indemnification and Payment of Damages by Buyer ................... 38
10.4   Time Limitations .................................................. 38
10.5   Limitations on Amount--Seller ..................................... 38
10.6   Limitations on Amount--Buyer ...................................... 38
10.7   Procedure for Indemnification--Third Party Claims ................. 39
10.8   Procedure for Indemnification--Other Claims ....................... 40

11. GENERAL PROVISIONS ................................................... 40
11.1   Expenses .......................................................... 40
11.2   Public Announcements .............................................. 40
11.3   Confidentiality ................................................... 40
11.4   Notices ........................................................... 41
11.5   Jurisdiction; Service of Process .................................. 41
11.6   Further Assurances ................................................ 41
11.7   Waiver ............................................................ 41
11.8   Entire Agreement and Modification ................................. 42
11.9   Disclosure Letter ................................................. 42
11.10  Assignments, Successors, and No Third-Party Rights ................ 42
11.11  Severability  ..................................................... 42
11.12  Section Headings, Construction .................................... 42
11.13  Time of Essence  .................................................. 42
11.14  Governing Law ..................................................... 43
11.15  Counterparts ...................................................... 43


The following exhibits are available to the Commission upon request

EXHIBITS
Exhibit 1 -  Disclosure Letter
Exhibit 2 -  Employment Agreement
Exhibit 3 -  Release
Exhibit 4 -  Investment Letter
Exhibit 5 -  Loan Agreement
Exhibit 6 -  Promissory Note

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                            STOCK EXCHANGE AGREEMENT


         This  Stock  Exchange  Agreement  ("Agreement")  is made as of July 23,
1998,  by  and  between  American  Resources  and  Development  Company,  a Utah
corporation ("Buyer"), and Robert Mintz (hereinafter referred to as "Seller").

                                    RECITALS

         Seller  desires to sell,  and Buyer  desires to  purchase  one  hundred
percent  (100%) of the issued and  outstanding  shares (the "Shares") of capital
stock of  Quade,  Inc.,  a  Connecticut  corporation  (the  "Company"),  for the
consideration  and on the terms set forth in this  Agreement and pursuant to the
provisions of section 368 (a) (1) (B) of the IRC.
AGREEMENT

         The parties, intending to be legally bound, agree as follows:

                                 1. DEFINITIONS

         For purposes of this  Agreement,  the following terms have the meanings
specified or referred to in this Section 1:

"Acquired Companies"--the Company and its Subsidiaries, collectively.

"Applicable  Contract"--any Contract (a) under which any Acquired Company has or
may acquire any rights,  (b) under which any Acquired  Company has or may become
subject to any obligation or liability,  or (c) by which any Acquired Company or
any of the assets owned or used by it is or may become bound.

"Asking  Price"--The  closing  Asking Price of Buyer's  common stock for any day
shall be the last  reported  sale price or, in case no such  reported sale takes
place on such day,  the  average of the asked  prices for such day, in each case
(1) on the principal national  securities exchange on which the shares of common
stock are listed or to which such  shares are  admitted to trading or (2) if the
common  stock is not listed or  admitted  to  trading  on a national  securities
exchange, in the over-the-counter market as reported by NASDAQ or any comparable
system or (3) if the common stock is not listed on NASDAQ or a comparable system
as furnished by two members of NASDAQ  selected  from time to time in good faith
by the Board of  Directors of Buyer for that  purpose.  In the absence of all of
the  foregoing,  or if for any other  reason the current  asking price per share
cannot be determined pursuant to the foregoing provisions of this paragraph, the
asking  market  price  per  share  shall be the fair  market  value  thereof  as
determined in good faith by the Board of Directors of the Buyer.

                                       1
<PAGE>

"Average Asking  Price"--"Average asking price" of Buyer's common stock shall be
the average of the daily  closing  asking prices for the six month period ending
on the  last  full  trading  day on the  exchange  or  market  specified  in the
succeeding sentence prior to March 31, 1999. The closing Asking Price of Buyer's
common  stock for any day shall be the last  reported  sale price or, in case no
such  reported sale takes place on such day, the average of the asked prices for
such day,  in each case (1) on the  principal  national  securities  exchange on
which the shares of common stock are listed or to which such shares are admitted
to trading or (2) if the common  stock is not listed or admitted to trading on a
national  securities  exchange,  in the  over-the-counter  market as reported by
NASDAQ or any  comparable  system or (3) if the  common  stock is not  listed on
NASDAQ or a comparable  system as  furnished  by two members of NASDAQ  selected
from  time to time in good  faith by the  Board of  Directors  of Buyer for that
purpose. In the absence of all of the foregoing,  or if for any other reason the
current  asking price per share cannot be  determined  pursuant to the foregoing
provisions  of this  paragraph,  the asking  market price per share shall be the
fair market value  thereof as determined in good faith by the Board of Directors
of the Buyer.

"Balance Sheet"--as defined in Section 3.4.

"Best Efforts"--the efforts that a prudent Person desirous of achieving a result
would use in similar  circumstances  to ensure  that such  result is achieved as
expeditiously as possible.

"Breach"--a "Breach" of a representation,  warranty,  covenant,  obligation,  or
other provision of this Agreement or any instrument  delivered  pursuant to this
Agreement  will be  deemed  to have  occurred  if  there  is or has been (a) any
inaccuracy  in or breach of, or any  failure to  perform  or comply  with,  such
representation,  warranty, covenant,  obligation, or other provision, or (b) any
claim  (by any  Person)  or  other  occurrence  or  circumstance  that is or was
inconsistent with such representation,  warranty, covenant, obligation, or other
provision,  and the term "Breach" means any such  inaccuracy,  breach,  failure,
claim, occurrence, or circumstance.

"Buyer"--as defined in the first paragraph of this Agreement.
"Closing"--as defined in Section 2.3.

"Closing Date"--the date and time as of which the Closing actually takes place.

"Company"--as defined in the Recitals of this Agreement.

"Consent"--any approval, consent,  ratification,  waiver, or other authorization
(including any Governmental Authorization).

"Contemplated  Transactions"--all  of  the  transactions  contemplated  by  this
Agreement, including:

                  (a)  the sale of the Shares by Sellers to Buyer;

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<PAGE>

                  (b)  the   execution,  delivery,  and   performance   of   the
                       Employment Agreement and the Sellers' Releases;

                  (c)  the performance by Buyer and Sellers of their  respective
                       covenants and obligations under this Agreement; and

                  (d)  Buyer's acquisition and ownership of the Shares.

"Contract"--any  agreement,  contract,   obligation,   promise,  or  undertaking
(whether  written  or oral and  whether  express  or  implied)  that is  legally
binding.

"Damages"--as defined in Section 10.2.

"Disclosure  Letter"--the  disclosure  letter  delivered  by  Sellers  to  Buyer
concurrently with the execution and delivery of this Agreement.

"Employment Agreement"--as defined in Section 2.4(a)(iii).

"Encumbrance"--any  charge,  claim,  community  property  interest,   condition,
equitable  interest,  lien, option,  pledge,  security interest,  right of first
refusal,  or restriction of any kind,  including any restriction on use, voting,
transfer, receipt of income, or exercise of any other attribute of ownership.

"Environment"--soil,   land  surface  or  subsurface   strata,   surface  waters
(including navigable waters, ocean waters,  streams, ponds, drainage basins, and
wetlands),  groundwaters,  drinking water supply, stream sediments,  ambient air
(including  indoor  air),  plant and animal  life,  and any other  environmental
medium or natural resource.

"Environmental,  Health, and Safety  Liabilities"--any  cost, damages,  expense,
liability,   obligation,   or  other   responsibility   arising  from  or  under
Environmental  Law or  Occupational  Safety and Health Law and  consisting of or
relating to:

                  (a) any environmental, health, or safety matters or conditions
                      (including on-site or off-site contamination, occupational
                      safety and health,  and regulation of chemical  substances
                      or products);

                  (b) fines, penalties, judgments, awards, settlements, legal or
                      administrative   proceedings,   damages,  losses,  claims,
                      demands  and   response,   investigative,   remedial,   or
                      inspection costs and expenses arising under  Environmental
                      Law or Occupational Safety and Health Law;

                  (c) financial   responsibility   under  Environmental  Law  or
                      Occupational  Safety and Health Law for  cleanup  costs or
                      corrective action,  including any investigation,  cleanup,
                      removal, containment, or other remediation or response

                                       3
<PAGE>

                      actions ("Cleanup")  required by applicable  Environmental
                      Law or Occupational  Safety and Health Law (whether or not
                      such  Cleanup  has  been  required  or  requested  by  any
                      Governmental Body or any other Person) and for any natural
                      resource damages; or

                  (d) any  other  compliance,   corrective,   investigative,  or
                      remedial  measures  required  under  Environmental  Law or
                      Occupational Safety and Health Law.

The terms  "removal,"  "remedial," and "response  action,"  include the types of
activities covered by the United States  Comprehensive  Environmental  Response,
Compensation,  and  Liability  Act,  42  U.S.C.  ss.  9601 et seq.,  as  amended
("CERCLA").

"Environmental Law"--any Legal Requirement that requires or relates to:

                  (a) advising  appropriate  authorities,   employees,  and  the
                      public of intended or actual  releases  of  pollutants  or
                      hazardous substances or materials, violations of discharge
                      limits, or other  prohibitions and of the commencements of
                      activities,  such as resource  extraction or construction,
                      that could have significant impact on the Environment;

                  (b) preventing or reducing to acceptable levels the release of
                      pollutants or hazardous  substances or materials  into the
                      Environment;

                  (c) reducing  the  quantities,   preventing  the  release,  or
                      minimizing  the hazardous  characteristics  of wastes that
                      are generated;

                  (d) assuring that products are designed, formulated, packaged,
                      and used so that they do not present unreasonable risks to
                      human health or the Environment when used or disposed of;

                  (e) protecting resources, species, or ecological amenities;

                  (f) reducing to  acceptable  levels the risks  inherent in the
                      transportation of hazardous substances,  pollutants,  oil,
                      or other potentially harmful substances;

                  (g) cleaning up pollutants that have been released, preventing
                      the threat of  release,  or paying the costs of such clean
                      up or prevention; or

                  (h) making responsible  parties pay private parties, or groups
                      of  them,   for  damages  done  to  their  health  or  the
                      Environment, or permitting self-appointed  representatives
                      of the public  interest  to recover for  injuries  done to
                      public assets.

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<PAGE>

"ERISA"--the  Employee  Retirement  Income Security Act of 1974 or any successor
law, and regulations and rules issued pursuant to that Act or any successor law.

"Facilities"--any  real property,  leaseholds,  or other interests  currently or
formerly owned or operated by any Acquired  Company and any  buildings,  plants,
structures,  or equipment  (including  motor  vehicles,  tank cars,  and rolling
stock) currently or formerly owned or operated by any Acquired Company.

"GAAP" -- generally accepted United States accounting  principles,  applied on a
basis  consistent  with the  basis on which  the  Balance  Sheet  and the  other
financial statements referred to in Section 3.4(b) were prepared.

"Governmental Authorization"--any approval, consent, license, permit, waiver, or
other authorization  issued,  granted,  given, or otherwise made available by or
under  the  authority  of  any  Governmental  Body  or  pursuant  to  any  Legal
Requirement.

"Governmental Body"--any:

                  (a) nation,  state, county, city, town, village,  district, or
                      other jurisdiction of any nature;

                  (b) federal,  state,  local,  municipal,  foreign,  or   other
                      government;

                  (c) governmental or quasi-governmental authority of any nature
                      (including any governmental  agency,  branch,  department,
                      official, or entity and any court or other tribunal);

                  (d) multi-national organization or body; or

                  (e) body   exercising,    or   entitled   to   exercise,   any
                      administrative,  executive, judicial, legislative, police,
                      regulatory, or taxing authority or power of any nature.

"Hazardous  Activity"--the  distribution,   generation,   handling,   importing,
management, manufacturing, processing, production, refinement, Release, storage,
transfer,  transportation,  treatment, or use (including any withdrawal or other
use of  groundwater)  of Hazardous  Materials in, on, under,  about, or from the
Facilities  or any  part  thereof  into  the  Environment,  and any  other  act,
business,  operation,  or thing that increases the danger, or risk of danger, or
poses  an  unreasonable  risk of  harm  to  persons  or  property  on or off the
Facilities,  or that may  affect  the value of the  Facilities  or the  Acquired
Companies.

"Hazardous  Materials"--any  waste or other  substance that is listed,  defined,
designated,  or  classified  as,  or  otherwise  determined  to  be,  hazardous,
radioactive,  or toxic or a pollutant or a contaminant  under or pursuant to any
Environmental Law, including any admixture or solution thereof, and specifically
including  petroleum  and  all  derivatives  thereof  or  synthetic  substitutes
therefor and asbestos or asbestos-containing materials.

"Intellectual Property Assets"--as defined in Section 3.22.

                                       5
<PAGE>

"IRC"--the  Internal  Revenue Code of 1986 or any successor law, and regulations
issued by the IRS pursuant to the Internal Revenue Code or any successor law.

"IRS"--the United States Internal Revenue Service or any successor agency,  and,
to the extent relevant, the United States Department of the Treasury.

"Knowledge"--an  individual  will be deemed to have  "Knowledge" of a particular
fact or other matter if:

                  (a) such  individual is actually  aware of  such fact or other
                      matter; or

                  (b) a prudent  individual  could be  expected  to  discover or
                      otherwise become aware of such fact or other matter in the
                      course   of   conducting   a   reasonably    comprehensive
                      investigation  concerning  the  existence  of such fact or
                      other matter.

         A Person (other than an individual)  will be deemed to have "Knowledge"
of a particular  fact or other matter if any individual  who is serving,  or who
has at any time served, as a director, officer, partner, executor, or trustee of
such Person (or in any similar  capacity) has, or at any time had,  Knowledge of
such fact or other matter.

"Legal   Requirement"--any   federal,   state,   local,   municipal,    foreign,
international,  multinational, or other administrative order, constitution, law,
ordinance, principle of common law, regulation, statute, or treaty.

"Net  Income"--Audited  annual net income after interest and  depreciation,  but
before taxes have been deducted.

"Occupational  Safety and Health Law"--any Legal Requirement designed to provide
safe and healthful  working  conditions  and to reduce  occupational  safety and
health hazards,  and any program,  whether  governmental  or private  (including
those   promulgated  or  sponsored  by  industry   associations   and  insurance
companies), designed to provide safe and healthful working conditions.

"Order"--any award, decision, injunction,  judgment, order, ruling, subpoena, or
verdict entered, issued, made, or rendered by any court,  administrative agency,
or other Governmental Body or by any arbitrator.

"Ordinary  Course of  Business"--an  action  taken by a Person will be deemed to
have been taken in the "Ordinary Course of Business" only if:

                  (a) such action is consistent  with the past practices of such
                      Person and is taken in the  ordinary  course of the normal
                      day-to-day operations of such Person;

                  (b) such action is not required to be  authorized by the board
                      of  directors of such Person (or by any Person or group of
                      Persons exercising similar authority) [and is not required
                      to be  specifically  authorized by the parent  company (if
                      any) of such Person]; and

                                       6
<PAGE>


                  (c) such action is similar in nature and  magnitude to actions
                      customarily taken,  without any authorization by the board
                      of  directors  (or by  any  Person  or  group  of  Persons
                      exercising similar  authority),  in the ordinary course of
                      the normal day-to-day operations of other Persons that are
                      in the same line of business as such Person.

"Organizational Documents"--(a) the articles or certificate of incorporation and
the bylaws of a corporation;  (b) the partnership agreement and any statement of
partnership of a general partnership;  (c) the limited partnership agreement and
the certificate of limited partnership of a limited partnership; (d) any charter
or similar document adopted or filed in connection with the creation, formation,
or organization of a Person; and (e) any amendment to any of the foregoing.

"Person"--any  individual,  corporation (including any non-profit  corporation),
general  or limited  partnership,  limited  liability  company,  joint  venture,
estate,  trust,  association,  organization,  labor  union,  or other  entity or
Governmental Body.

"Proceeding"--any   action,   arbitration,    audit,   hearing,   investigation,
litigation, or suit (whether civil, criminal, administrative,  investigative, or
informal)  commenced,  brought,  conducted,  or heard by or before, or otherwise
involving, any Governmental Body or arbitrator.

"Related Person"--with respect to a particular individual:

                  (a) each other member of such individual's Family;

                  (b) any Person that is directly or  indirectly  controlled  by
                      such   individual   or  one  or  more   members   of  such
                      individual's Family;

                  (c) any  Person in which  such  individual  or members of such
                      individual's   Family   hold   (individually   or  in  the
                      aggregate) a Material Interest; and

                  (d) any Person with respect to which such individual or one or
                      more  members  of such  individual's  Family  serves  as a
                      director,  officer, partner, executor, or trustee (or in a
                      similar capacity).

         With respect to a specified Person other than an individual:

                  (a) any  Person  that  directly  or  indirectly  controls,  is
                      directly or  indirectly  controlled  by, or is directly or
                      indirectly   under  common  control  with  such  specified
                      Person;

                  (b) any  Person  that  holds  a  Material   Interest  in  such
                      specified Person;

                                       7
<PAGE>

                  (c) each Person that serves as a director,  officer,  partner,
                      executor,  or  trustee of such  specified  Person (or in a
                      similar capacity);

                  (d) any Person in which such specified Person holds a Material
                      Interest;

                  (e) any Person  with  respect to which such  specified  Person
                      serves as a general  partner or a trustee (or in a similar
                      capacity); and

                  (f) any Related Person of any  individual  described in clause
                      (b) or (c).

         For  purposes of this  definition,  (a) the  "Family" of an  individual
includes (i) the individual,  (ii) the  individual's  spouse and former spouses,
(iii)  any  other  natural  person  who  is  related  to the  individual  or the
individual's  spouse within the second degree, and (iv) any other natural person
who resides with such  individual,  and (b) "Material  Interest" means direct or
indirect  beneficial  ownership  (as defined in Rule 13d-3 under the  Securities
Exchange  Act  of  1934)  of  voting   securities  or  other  voting   interests
representing at least 10% of the outstanding  voting power of a Person or equity
securities  or  other  equity  interests   representing  at  least  10%  of  the
outstanding equity securities or equity interests in a Person.

"Release"--any spilling, leaking, emitting, discharging,  depositing,  escaping,
leaching, dumping, or other releasing into the Environment,  whether intentional
or unintentional.

"Representative"--with  respect to a particular Person,  any director,  officer,
employee,  agent,  consultant,  advisor, or other representative of such Person,
including legal counsel, accountants, and financial advisors.

"Securities  Act"--the  Securities  Act  of  1933  or  any  successor  law,  and
regulations  and  rules  issued  pursuant  to  that  Act or any  successor  law.
"Sellers"--as defined in the first paragraph of this Agreement.

"Sellers' Releases"--as defined in Section 2.4.

"Shares"--as defined in the Recitals of this Agreement.

"Subsidiary"--with respect to any Person (the "Owner"), any corporation or other
Person  of which  securities  or other  interests  having  the  power to elect a
majority of that  corporation's  or other Person's board of directors or similar
governing  body,  or  otherwise  having  the power to direct  the  business  and
policies of that  corporation  or other Person  (other than  securities or other
interests  having such power only upon the happening of a  contingency  that has
not  occurred)  are held by the Owner or one or more of its  Subsidiaries;  when
used without reference to a particular  Person,  "Subsidiary" means a Subsidiary
of the Company.

                                       8
<PAGE>

"Tax Return"--any return (including any information return), report,  statement,
schedule, notice, form, or other document or information filed with or submitted
to, or  required  to be filed with or  submitted  to, any  Governmental  Body in
connection with the determination, assessment, collection, or payment of any Tax
or in connection with the administration,  implementation,  or enforcement of or
compliance with any Legal Requirement relating to any Tax.

"Threat of  Release"--a  substantial  likelihood  of a Release  that may require
action in order to prevent or mitigate damage to the Environment that may result
from such Release.

"Threatened"--a  claim,  Proceeding,  dispute,  action,  or other matter will be
deemed to have  been  "Threatened"  if any  demand  or  statement  has been made
(orally or in writing) or any notice has been given  (orally or in writing),  or
if any other event has  occurred or any other  circumstances  exist,  that would
lead a  prudent  Person to  conclude  that  such a claim,  Proceeding,  dispute,
action, or other matter is likely to be asserted, commenced, taken, or otherwise
pursued in the future.

2. SALE AND TRANSFER OF SHARES; CLOSING

2.1 SHARES

         Subject to the terms and conditions of this Agreement,  at the Closing,
Sellers will  exchange and transfer the Shares to Buyer,  and Buyer will acquire
the Shares from Sellers.

2.2 PURCHASE PRICE

         The purchase  price (the  "Purchase  Price") for the Shares will be the
issuance of 213,333 shares of common stock of Buyer. On or before July 15, 1999,
if the Average  Asking Price of Buyer's  common stock is not equal to or greater
than $5.00,  Buyer shall issue to Seller additional shares of common stock equal
to 32,000 shares issued to him pursuant to this Section 2.2  multiplied by 5 and
divided by the Average Asking Price less the 32,000 shares issued to such Seller
pursuant to this Section 2.2.

2.3 ADDITIONAL CONSIDERATION

         In  addition  to the  shares of stock  issued to  Sellers  at  Closing,
Sellers  shall  have the right for a three  year  period to  receive  additional
shares of common  stock of Buyer  based upon the Net Income of the  Company  for
each of the three  Fiscal  Years ended March 31, 2001.  Such  additional  shares
shall be issued on or before July 15 of each  applicable year in accordance with
the following provisions:

                  (a) If the Net Income of the Company for the fiscal year ended
                      March 31,  1999 is $27,167 or  greater,  Sellers  shall be
                      issued a number of Buyer's  common shares equal to 142,222
                      multiplied  by the Net  Income  of the  Company  for  such
                      period, divided by $81,500.

                                       9
<PAGE>


                  (b) If the Net Income of the  Company  for the two year period
                      ending  March 31, 2000 is  $278,333  or  greater,  Sellers
                      shall be issued a number of Buyer's common shares equal to
                      284,444  multiplied  by the Net Income of the  company for
                      such  period,  divided  by  $835,500,  minus the number of
                      shares issued pursuant to Section 2.3(a).

                  (c) If the Net Income of the Company for the three year period
                      ending  March 31, 2001 is  $778,233  or  greater,  Sellers
                      shall be issued a number of Buyer's common shares equal to
                      400,000  multiplied  by the Net Income of the  Company for
                      such period,  divided by  $2,334,700,  minus the number of
                      shares  issued   pursuant  to  Sections  2.3(a)  and  (b),
                      provided,  however,  the total  number of  Buyer's  common
                      shares to be issued to Sellers pursuant to Section 2.3(a),
                      (b) and (c) (without  considering any increase as a result
                      of Section 2.3(d)), shall not exceed 426,667 shares.

                  (d) The number of Buyer's  common  shares  issued  pursuant to
                      Sections 2.3(a),  (b) and (c) shall be increased,  but not
                      decreased by multiplying the number of shares to be issued
                      by $5.00  and  dividing  by the  Average  Asking  Price of
                      Buyer's common stock.

2.4 LOAN COMMITMENTS

         Buyer and  Sellers  acknowledge  that Buyer has  loaned  $40,000 to the
Company as of the date of this Agreement. In addition,  Buyer has agreed to loan
an additional $200,000 to the Company pursuant to the following schedule:.

At Closing:                                                   $ 75,000
On or Before August 31, 1998:                                 $125,000

Buyer  shall  also  provide  for a letter of credit for up to  $200,000  for the
Company to make blank purchases.

         These loans and lease amount shall be evidenced by a Loan Agreement and
Promissory  Note to be signed at the  Closing.  Interest on funds  loaned to the
Company  shall  accrue  at eight  percent.  Interest  on the loan  shall be paid
quarterly and all interest and  principal  shall be due and payable on or before
July 31, 2001, all as provided in the Loan Agreement and Promissory Note.

                                       10
<PAGE>

2.5 CLOSING

         The exchange of shares (the  "Closing")  provided for in this Agreement
will take place at the offices of Parry Lawrence & Ward,  1270 Eagle Gate Tower,
60 East South Temple,  Salt Lake City,  Utah 84111, at 9:30 a.m. (local time) on
July 23, 1998 or at such other time and place as the parties may agree.  Subject
to the  provisions  of Section 9,  failure to  consummate  the purchase and sale
provided for in this Agreement on the date and time and at the place  determined
pursuant  to this  Section  2.3  will  not  result  in the  termination  of this
Agreement and will not relieve any party of any obligation under this Agreement.

2.6 CLOSING OBLIGATIONS

At the Closing:
                  (a) Sellers will deliver to Buyer:

                      (i)    certificates representing the Shares, duly endorsed
                             (or  accompanied  by duly executed  stock  powers),
                             with signatures  guaranteed by a commercial bank or
                             by a member  firm of the New York  Stock  Exchange,
                             for transfer to Buyer;

                      (ii)   a  release  in  the  form  of  Exhibit   2.7(a)(ii)
                             executed   by   Seller   (collectively,   "Sellers'
                             Releases");

                      (iii)  an  employment  agreement  in the  form of  Exhibit
                             22.7(a)(iii),  executed  by  Robert  Mintz  and the
                             Company ("Employment Agreement");

                      (iv)   an  investment   letter  in  the  form  of  Exhibit
                             2.7(a)(iv),  executed by Seller (collectively,  the
                             "Investment Letters").

                      (v)    a certificate  executed by Seller  representing and
                             warranting   to  Buyer   that   each  of   Seller's
                             representations  and  warranties in this  Agreement
                             was accurate in all respects as of the date of this
                             Agreement and is accurate in all respects as of the
                             Closing Date as if made on the Closing Date (giving
                             full effect to any  supplements  to the  Disclosure
                             Letter  that were  delivered  by  Sellers  to Buyer
                             prior  to  the  Closing  Date  in  accordance  with
                             Section ( 5.5); and

                  (b) Buyer will deliver to Sellers:

                      (i)    certificates for  common  stock in  Buyer totalling
                             213,333 shares of common stock; and

                      (ii)   a certificate executed by Buyer to the effect that,
                             except as  otherwise  stated  in such  certificate,
                             each of Buyer's  representations  and warranties in
                             this  Agreement  was accurate in all respects as of
                             the date of this  Agreement  and is accurate in all
                             respects as of the  Closing  Date as if made on the
                             Closing Date.

                                       11
<PAGE>

3. REPRESENTATIONS AND WARRANTIES OF SELLERS

         Seller has delivered to Buyer copies of the Organizational documents of
each Acquired Company, as currently in effect.

                  (a) Part 3.1 of the Disclosure  Letter contains a complete and
                      accurate list for each Acquired  Company of its name,  its
                      jurisdiction  of  incorporation,  other  jurisdictions  in
                      which  it  is   authorized   to  do   business,   and  its
                      capitalization (including the identity of each stockholder
                      and the  number of shares  held by  each).  Each  Acquired
                      Company is a corporation duly organized, validly existing,
                      and in good standing under the laws of its jurisdiction of
                      incorporation,  with full corporate power and authority to
                      conduct its business as it is now being conducted,  to own
                      or use the  properties  and assets that it purports to own
                      or  use,  and  to  perform  all  its   obligations   under
                      Applicable  Contracts.   Each  Acquired  Company  is  duly
                      qualified to do business as a foreign  corporation  and is
                      in good  standing  under  the laws of each  state or other
                      jurisdiction  in which either the  ownership or use of the
                      properties  owned  or used  by it,  or the  nature  of the
                      activities conducted by it, requires such qualification.

                  (b) Seller   have   delivered   to   Buyer   copies   of   the
                      Organizational Documents of each Acquired Company, as
                      currently in effect.

3.2 AUTHORITY; NO CONFLICT

                  (a) This Agreement  constitutes the legal,  valid, and binding
                      obligation  of  Seller,   enforceable  against  Seller  in
                      accordance with its terms. Upon the execution and delivery
                      by  Seller  of  the  Subscription  Agreement,   Investment
                      Letter,  Loan  Agreement,  Promissory  Note and Employment
                      Agreement,  and the Sellers' Releases  (collectively,  the
                      "Sellers'  Closing   Documents"),   the  Sellers'  Closing
                      Documents will  constitute the legal,  valid,  and binding
                      obligations  of Sellers,  enforceable  against  Sellers in
                      accordance with their  respective  terms.  Seller have the
                      absolute and unrestricted  right,  power,  authority,  and
                      capacity  to execute and deliver  this  Agreement  and the
                      Seller' Closing Documents and to perform their obligations
                      under this Agreement and the Seller' Closing Documents.

                  (b) Neither the execution  and delivery of this  Agreement nor
                      the consummation or performance of any of the Contemplated
                      Transactions will, directly or indirectly (with or without
                      notice or lapse of time):

                      (i)    contravene, conflict with, or result in a violation
                             of  (A)  any   provision   of  the   Organizational
                             Documents  of the  Acquired  Companies,  or (B) any
                             resolution adopted by the board of directors or the
                             stockholders of any Acquired Company;

                      (ii)   contravene, conflict with, or result in a violation
                             of, or give any  Governmental  Body or other Person
                             the  right  to  challenge  any of the  Contemplated
                             Transactions  or to  exercise  any remedy or obtain
                             any  relief  under,  any Legal  Requirement  or any
                             Order to which any Acquired  Company or Seller,  or
                             any of the  assets  owned  or used by any  Acquired
                             Company, may be subject;

                                       12
<PAGE>

                      (iii)  contravene, conflict with, or result in a violation
                             of any of the terms or requirements of, or give any
                             Governmental  Body the right to  revoke,  withdraw,
                             suspend,   cancel,   terminate,   or  modify,   any
                             Governmental  Authorization  that  is  held  by any
                             Acquired  Company or that otherwise  relates to the
                             business of, or any of the assets owned or used by,
                             any Acquired Company;

                      (iv)   cause  Buyer  or any  Acquired  Company  to  become
                             subject to, or to become liable for the payment of,
                             any Tax;

                      (v)    cause  any  of the  assets  owned  by any  Acquired
                             Company to be  reassessed or revalued by any taxing
                             authority or other Governmental Body;

                      (vi)   contravene, conflict with, or result in a violation
                             or breach of any  provision  of, or give any Person
                             the  right to  declare a default  or  exercise  any
                             remedy  under,  or to  accelerate  the  maturity or
                             performance of, or to cancel, terminate, or modify,
                             any Applicable Contract; or

                      (vii)  result  in  the   imposition  or  creation  of  any
                             Encumbrance  upon  or  with  respect  to any of the
                             assets owned or used by any Acquired Company.

         Neither Seller nor Acquired  Company is or will be required to give any
notice to or obtain any Consent from any Person in connection with the execution
and delivery of this Agreement or the  consummation or performance of any of the
Contemplated Transactions.  (c) Seller are acquiring the common shares for their
own  account  and not with a view to their  distribution  within the  meaning of
Section 2(11) of the Securities Act.

3.3 CAPITALIZATION

         The  authorized  equity  securities  of the  Company  consist of ______
shares of common  stock,  par value per share,  of which  __________  shares are
issued and outstanding and constitute the Shares.  Seller are and will be on the
Closing Date the record and  beneficial  owners and holders of the Shares,  free
and clear of all Encumbrances. With the exception of the Shares (which are owned
by Seller),  all of the outstanding  equity  securities and other  securities of
each Acquired Company are owned of record and beneficially by one or more of the
Acquired  Companies,  free and  clear of all  Encumbrances.  No  legend or other
reference to any purported Encumbrance appears upon any certificate representing
equity  securities  of any  Acquired  Company.  All of  the  outstanding  equity
securities of each Acquired Company have been duly authorized and validly issued
and are fully paid and  nonassessable.  There are no  Contracts  relating to the
issuance,  sale, or transfer of any equity securities or other securities of any
Acquired Company.  None of the outstanding equity securities or other securities
of any Acquired  Company was issued in violation  of the  Securities  Act or any
other  Legal  Requirement.  No Acquired  Company  owns,  or has any  Contract to
acquire,  any equity  securities  or other  securities of any Person (other than
Acquired  Companies) or any direct or indirect  equity or ownership  interest in
any other business.

3.4 FINANCIAL STATEMENTS

         Seller have  delivered to Buyer:  (a)  unaudited  consolidated  balance
sheets of the  Acquired  Companies as at March 31, 1998 (the  "Balance  Sheet").
Such Balance Sheet presents the financial  condition of the Acquired  Company as
at the respective date of such Balance Sheet.

3.5 BOOKS AND RECORDS

         The books of account,  minute  books,  stock  record  books,  and other
records of the  Acquired  Companies,  all of which have been made  available  to
Buyer,  are complete and correct and have been  maintained  in  accordance  with
sound business  practices.  The minute books of the Acquired  Companies  contain
accurate and  complete  records of all meetings  held of, and  corporate  action
taken by, the  stockholders,  the Boards of  Directors,  and  committees  of the
Boards of  Directors  of the  Acquired  Companies,  and no  meeting  of any such
stockholders,  Board of Directors,  or committee has been held for which minutes
have not been  prepared  and are not  contained  in such  minute  books.  At the
Closing,  all of  those  books  and  records  will be in the  possession  of the
Acquired Companies.

                                       13
<PAGE>

3.6 TITLE TO PROPERTIES; ENCUMBRANCES

         The Acquired  Companies own (with good and marketable title in the case
of  real  property,  subject  only to the  matters  permitted  by the  following
sentence) all the properties and assets  (whether real,  personal,  or mixed and
whether  tangible  or  intangible)  that  they  purport  to own  located  in the
facilities owned or operated by the Acquired  Companies or reflected as owned in
the books and records of the Acquired Companies, including all of the properties
and assets  reflected in the Balance Sheet and all of the  properties and assets
purchased or otherwise  acquired by the Acquired Companies since the date of the
Balance  Sheet in the  Ordinary  Course of  Business  and  consistent  with past
practice.  All material properties and assets reflected in the Balance Sheet are
free and clear of all  Encumbrances  and are not, in the case of real  property,
subject to any rights of way, building use restrictions,  exceptions, variances,
reservations,  or  limitations  of any nature  except,  with respect to all such
properties and assets,  (a) mortgages or security interests shown on the Balance
Sheet as securing specified liabilities or obligations, with respect to which no
default (or event that, with notice or lapse of time or both, would constitute a
default) exists, (b) mortgages or security interests incurred in connection with
the  purchase of property  or assets  after the date of the Balance  Sheet (such
mortgages  and  security  interests  being  limited to the property or assets so
acquired), with respect to which no default (or event that, with notice or lapse
of time or both, would constitute a default) exists, (c) liens for current taxes
not yet due, and (d) with respect to real property,  (i) minor  imperfections of
title, if any, none of which is substantial in amount,  materially detracts from
the value or impairs the use of the  property  subject  thereto,  or impairs the
operations  of any  Acquired  Company,  and (ii)  zoning laws and other land use
restrictions  that do not impair the present or anticipated  use of the property
subject  thereto.  All buildings,  plants,  and structures owned by the Acquired
Companies  lie wholly within the  boundaries  of the real property  owned by the
Acquired  Companies  and do not  encroach  upon the  property  of, or  otherwise
conflict with the property rights of, any other Person.

3.7 CONDITION AND SUFFICIENCY OF ASSETS

         The  buildings,  plants,  structures,  and  equipment  of the  Acquired
Companies are structurally  sound,  are in good operating  condition and repair,
and are  adequate  for the uses to which  they are being  put,  and none of such
buildings, plants, structures, or equipment is in need of maintenance or repairs
except for ordinary,  routine  maintenance  and repairs that are not material in
nature or cost. The building,  plants, structures, and equipment of the Acquired
Companies are  sufficient for the continued  conduct of the Acquired  Companies'
businesses after the Closing in substantially the same manner as conducted prior
to the Closing.

3.8 ACCOUNTS RECEIVABLE

         All accounts receivable of the Acquired Companies that are reflected on
the Balance Sheet or on the accounting  records of the Acquired  Companies as of
the Closing Date  (collectively,  the "Accounts  Receivable")  represent or will
represent  valid  obligations  arising  from  sales  actually  made or  services
actually performed in the Ordinary Course of Business.  Unless paid prior to the
Closing  Date,  the  Accounts  Receivable  are or will be as of the Closing Date
current and  collectible  net of the  respective  reserves  shown on the Balance
Sheet or on the accounting  records of the Acquired  Companies as of the Closing
Date (which  reserves are adequate and calculated  consistent with past practice
and,  in the case of the reserve as of the Closing  Date,  will not  represent a
greater  percentage  of the Accounts  Receivable as of the Closing Date than the
reserve  reflected in the Balance Sheet  represented of the Accounts  Receivable
reflected  therein  and will not  represent  a  material  adverse  change in the
composition  of such  Accounts  Receivable  in terms of aging).  Subject to such
reserves,  each of the Accounts  Receivable either has been or will be collected
in full, without any set-off, within ninety days after the day on which it first
becomes due and payable. There is no contest, claim, or right of set-off, other

                                       14
<PAGE>

than returns in the Ordinary  Course of  Business,  under any Contract  with any
obligor of an  Accounts  Receivable  relating  to the amount or validity of such
Accounts  Receivable.  Part 3.8 of the Disclosure Letter contains a complete and
accurate list of all Accounts  Receivable  as of the date of the Balance  Sheet,
which list sets forth the aging of such Accounts Receivable.

3.9 INVENTORY

         All  inventory of the Acquired  Companies,  whether or not reflected in
the Balance Sheet,  consists of a quality and quantity usable and salable in the
Ordinary   Course  of  Business,   except  for  obsolete   items  and  items  of
below-standard  quality,  all of which have been  written off or written down to
net realizable  value in the Balance Sheet or on the  accounting  records of the
Acquired  Companies as of the Closing Date, as the case may be. All  inventories
not written off have been priced at the lower of cost or net realizable value on
a first in, first out basis.  The quantities of each item of inventory  (whether
raw materials,  work-in-process,  or finished goods) are not excessive,  but are
reasonable in the present circumstances of the Acquired Companies.

3.10 NO UNDISCLOSED LIABILITIES

         Except as set forth in Part 3.10 of the Disclosure Letter, the Acquired
Companies have no  liabilities  or  obligations of any nature  (whether known or
unknown and whether  absolute,  accrued,  contingent,  or otherwise)  except for
liabilities  or obligations  reflected or reserved  against in the Balance Sheet
and current  liabilities  incurred in the Ordinary  Course of Business since the
respective dates thereof.

3.11 TAXES

                  (a) The  Acquired  Companies  have filed or caused to be filed
                      all Tax Returns  that are or were  required to be filed by
                      or with respect to any of them,  either separately or as a
                      member of a group of corporations,  pursuant to applicable
                      Legal  Requirements.  The Acquired Companies have paid, or
                      made  provision for the payment of, all Taxes that have or
                      may have  become  due  pursuant  to those Tax  Returns  or
                      otherwise,  or  pursuant  to any  assessment  received  by
                      Seller or any Acquired Company.

                  (b) Neither Seller nor any Acquired  Company has given or been
                      requested to give waivers or extensions (or is or would be
                      subject  to a  waiver  or  extension  given  by any  other
                      Person) of any  statute  of  limitations  relating  to the
                      payment of Taxes of any Acquired  Company or for which any
                      Acquired Company may be liable.

                  (c) The charges,  accruals, and reserves with respect to Taxes
                      on the  respective  books  of each  Acquired  Company  are
                      adequate  (determined in accordance  with GAAP) and are at
                      least  equal  to that  Acquired  Company's  liability  for
                      Taxes. There exists no proposed tax assessment against any
                      Acquired Company.

                  (d) All  Tax   Returns   filed  by  (or  that   include  on  a
                      consolidated   basis)  any  Acquired   Company  are  true,
                      correct,  and complete.  There is no tax sharing agreement
                      that will  require  any  payment by any  Acquired  Company
                      after the date of this Agreement.


                                       15
<PAGE>

3.12 NO MATERIAL ADVERSE CHANGE

         Since the date of the Balance  Sheet,  there has not been any  material
adverse change in the business,  operations,  properties,  prospects, assets, or
condition of any  Acquired  Company,  and no event has occurred or  circumstance
exists that may result in such a material adverse change.

3.13 EMPLOYEE BENEFITS

                  (a) As used in this Section 3.13, the following terms have the
                      meanings set forth below.

"Company  Other  Benefit  Obligation"  means an Other Benefit  Obligation  owed,
adopted, or followed by an Acquired Company or an ERISA Affiliate of an Acquired
Company.

"Company  Plan"  means  all  Plans  of  which an  Acquired  Company  or an ERISA
Affiliate  of an  Acquired  Company  is or was a Plan  Sponsor,  or to  which an
Acquired  Company  or an  ERISA  Affiliate  of  an  Acquired  Company  otherwise
contributes  or has  contributed,  or in which an  Acquired  Company or an ERISA
Affiliate of an Acquired Company otherwise participates or has participated. All
references to Plans are to Company Plans unless the context requires otherwise.

"Company  VEBA" means a VEBA whose  members  include  employees  of any Acquired
Company or any ERISA Affiliate of an Acquired Company.

"ERISA Affiliate"  means, with respect to an Acquired Company,  any other person
that, together with the Company, would be treated as a single employer under IRC
ss. 414.

"Multi-Employer Plan" has the meaning given in ERISA ss. 3(37)(A).

"Other Benefit  Obligations" means all obligations,  arrangements,  or customary
practices,  whether or not legally enforceable,  to provide benefits, other than
salary, as compensation for services  rendered,  to present or former directors,
employees, or agents, other than obligations,  arrangements,  and practices that
are Plans. Other Benefit Obligations  include consulting  agreements under which
the  compensation  paid does not depend  upon the  amount of  service  rendered,
sabbatical policies,  severance payment policies, and fringe benefits within the
meaning of IRC ss. 132.

"PBGC" means the Pension Benefit Guaranty Corporation, or any successor thereto.

"Pension Plan" has the meaning given in ERISA ss. 3(2)(A).

"Plan" has the meaning given in ERISA ss. 3(3).

"Plan Sponsor" has the meaning given in ERISA ss. 3(16)(B).

"Qualified  Plan" means any Plan that meets or purports to meet the requirements
of IRC ss. 401(a).

"Title IV Plans" means all Pension  Plans that are subject to Title IV of ERISA,
29 U.S.C. ss. 1301 et seq., other than Multi-Employer Plans.

"VEBA"  means a  voluntary  employees'  beneficiary  association  under  IRC ss.
501(c)(9).

"Welfare Plan" has the meaning given in ERISA ss. 3(1).

3.14 COMPLIANCE WITH LEGAL REQUIREMENTS; GOVERNMENTAL AUTHORIZATIONS

                  (a) Except as set forth in Part 3.14 of the Disclosure Letter:

                      (i)    each  Acquired  Company  is, and at all times since
                             December 31, 1996 has been, in full compliance with
                             each Legal Requirement that is or was applicable to
                             it or to the conduct or  operation  of its business
                             or the ownership or use of any of its assets;


                                       16
<PAGE>

                      (ii)   no event has  occurred or  circumstance exists that
                             (with or  without  notice or lapse of time) (A) may
                             constitute or result in a violation by any Acquired
                             Company  of,  or a  failure  on  the  part  of  any
                             Acquired   Company  to  comply   with,   any  Legal
                             Requirement, or (B) may give rise to any obligation
                             on the part of any Acquired  Company to  undertake,
                             or to bear all or any  portion  of the cost of, any
                             remedial action of any nature; and

                      (iii)  no Acquired Company has received, at any time since
                             December   31,   1996,    any   notice   or   other
                             communication  (whether  oral or written)  from any
                             Governmental Body or any other Person regarding (A)
                             any  actual,   alleged,   possible,   or  potential
                             violation of, or failure to comply with,  any Legal
                             Requirement,  or (B) any actual, alleged, possible,
                             or potential obligation on the part of any Acquired
                             Company to undertake, or to bear all or any portion
                             of the cost of, any remedial action of any nature.

                  (b) Part 3.14 of the Disclosure Letter contains a complete and
                      accurate list of each Governmental  Authorization  that is
                      held by any Acquired Company or that otherwise  relates to
                      the business of, or to any of the assets owned or used by,
                      any  Acquired  Company.  Each  Governmental  Authorization
                      listed  or  required  to be  listed  in  Part  3.14 of the
                      Disclosure  Letter is valid and in full force and  effect.
                      Except as set forth in Part 3.14 of the Disclosure Letter:

                      (i)    each  Acquired  Company  is, and at all times since
                             December 31, 1996 has been, in full compliance with
                             all  of  the   terms  and   requirements   of  each
                             Governmental  Authorization  identified or required
                             to be identified in Part 3.14 of the Disclosure
                             Letter;

                      (ii)   no event has occurred or  circumstance  exists that
                             may (with or  without  notice or lapse of time) (A)
                             constitute  or result  directly or  indirectly in a
                             violation  of or a failure to comply  with any term
                             or  requirement of any  Governmental  Authorization
                             listed or required to be listed in Part 3.14 of the
                             Disclosure   Letter,  or  (B)  result  directly  or
                             indirectly   in   the    revocation,    withdrawal,
                             suspension, cancellation, or termination of, or any
                             modification  to,  any  Governmental  Authorization
                             listed or required to be listed in Part 3.14 of the
                             Disclosure Letter;

                      (iii)  no Acquired Company has received, at any time since
                             December   31,   1996,    any   notice   or   other
                             communication  (whether  oral or written)  from any
                             Governmental Body or any other Person regarding (A)
                             any  actual,   alleged,   possible,   or  potential
                             violation  of or failure to comply with any term or
                             requirement of any Governmental  Authorization,  or
                             (B) any actual,  proposed,  possible,  or potential
                             revocation, withdrawal,  suspension,  cancellation,
                             termination of, or modification to any Governmental
                             Authorization; and


                                       17
<PAGE>

                      (iv)   all applications  required  to  have been filed for
                             the  renewal  of  the  Governmental  Authorizations
                             listed or required to be listed in Part 3.14 of the
                             Disclosure  Letter have been duly filed on a timely
                             basis with the appropriate Governmental Bodies, and
                             all other  filings  required to have been made with
                             respect to such  Governmental  Authorizations  have
                             been  duly  made  on  a  timely   basis   with  the
                             appropriate Governmental Bodies.

         The Governmental  Authorizations  listed in Part 3.14 of the Disclosure
Letter collectively constitute all of the Governmental  Authorizations necessary
to  permit  the  Acquired  Companies  to  lawfully  conduct  and  operate  their
businesses in the manner they currently  conduct and operate such businesses and
to permit the  Acquired  Companies  to own and use their assets in the manner in
which they currently own and use such assets.

3.15 LEGAL PROCEEDINGS; ORDERS

                  (a) Except as set forth in Part 3.15 of the Disclosure Letter,
                      there is no pending Proceeding:

                      (i)    that has been  commenced by or against any Acquired
                             Company or that otherwise  relates to or may affect
                             the business of, or any of the assets owned or used
                             by, any Acquired Company; or

                      (ii)   that  challenges,  or that may have the  effect  of
                             preventing,  delaying, making illegal, or otherwise
                             interfering   with,   any   of   the   Contemplated
                             Transactions.

         To the  Knowledge  of Seller and the  Acquired  Companies,  (1) no such
Proceeding has been  Threatened,  and (2) no event has occurred or  circumstance
exists  that may give  rise to or serve as a basis for the  commencement  of any
such  Proceeding.  Seller  have  delivered  to Buyer  copies  of all  pleadings,
correspondence,  and other documents  relating to each Proceeding listed in Part
3.15 of the  Disclosure  Letter.  The  Proceedings  listed  in Part  3.15 of the
Disclosure  Letter  will not have a  material  adverse  effect on the  business,
operations, assets, condition, or prospects of any Acquired Company.

                  (b) Except as set forth in Part 3.15 of the Disclosure Letter:

                      (i)    there  is no Order  to  which  any of the  Acquired
                             Companies,  or any of the  assets  owned or used by
                             any Acquired Company, is subject;

                      (ii)   no Seller is subject  to any Order that  relates to
                             the business of, or any of the assets owned or used
                             by, any Acquired Company; and

                      (iii)  to  the   Knowledge  of  Seller  and  the  Acquired
                             Companies, no officer, director, agent, or employee
                             of any  Acquired  Company  is  subject to any Order
                             that prohibits such officer,  director,  agent,  or
                             employee  from   engaging  in  or  continuing   any
                             conduct,  activity,  or  practice  relating  to the
                             business of any Acquired Company.


                                       18
<PAGE>

                  (c) Except as set forth in Part 3.15 of the Disclosure Letter:

                      (i)    each  Acquired  Company  is, and at all times since
                             December 31, 1996 has been, in full compliance with
                             all of the terms and  requirements of each Order to
                             which it, or any of the assets owned or used by it,
                             is or has been subject;

                      (ii)   no event has occurred or  circumstance  exists that
                             may constitute or result in (with or without notice
                             or lapse  of time) a  violation  of or  failure  to
                             comply with any term or requirement of any Order to
                             which any  Acquired  Company,  or any of the assets
                             owned or used by any Acquired Company,  is subject;
                             and

                      (iii)  no Acquired Company has received, at any time since
                             December   31,   1996,    any   notice   or   other
                             communication  (whether  oral or written)  from any
                             Governmental Body or any other Person regarding any
                             actual,  alleged,  possible, or potential violation
                             of,  or  failure  to  comply  with,   any  term  or
                             requirement  of any  Order  to which  any  Acquired
                             Company,  or any of the assets owned or used by any
                             Acquired Company, is or has been subject.

3.16 ABSENCE OF CERTAIN CHANGES AND EVENTS

         Except as set forth in Part 3.16 of the  Disclosure  Letter,  since the
date  of  the  Balance  Sheet,  the  Acquired  Companies  have  conducted  their
businesses only in the Ordinary Course of Business and there has not been any:

                  (a) change  in any  Acquired  Company's  authorized  or issued
                      capital  stock;  grant  of any  stock  option  or right to
                      purchase shares of capital stock of any Acquired  Company;
                      issuance of any  security  convertible  into such  capital
                      stock;  grant  of  any  registration   rights;   purchase,
                      redemption,   retirement,  or  other  acquisition  by  any
                      Acquired  Company of any shares of any such capital stock;
                      or  declaration  or  payment  of  any  dividend  or  other
                      distribution  or  payment  in respect of shares of capital
                      stock;

                  (b) amendment to the Organizational  Documents of any Acquired
                      Company;

                  (c) payment  or  increase  by  any  Acquired  Company  of  any
                      bonuses,   salaries,   or   other   compensation   to  any
                      stockholder, director, officer, or (except in the Ordinary
                      Course of Business) employee or entry into any employment,
                      severance, or similar Contract with any director, officer,
                      or employee;

                  (d) adoption  of, or increase  in the  payments to or benefits
                      under, any profit sharing,  bonus, deferred  compensation,
                      savings, insurance, pension, retirement, or other employee
                      benefit  plan for or with any  employees  of any  Acquired
                      Company;

                  (e) damage to or  destruction or loss of any asset or property
                      of  any  Acquired  Company,  whether  or  not  covered  by
                      insurance,   materially   and   adversely   affecting  the
                      properties,  assets,  business,  financial  condition,  or
                      prospects of the Acquired Companies, taken as a whole;


                                       19
<PAGE>

                  (f) entry  into,  termination  of,  or  receipt  of  notice of
                      termination of (i) any license,  distributorship,  dealer,
                      sales  representative,  joint venture,  credit, or similar
                      agreement, or (ii) any Contract or transaction involving a
                      total remaining  commitment by or to any Acquired  Company
                      of at least $10,000;

                  (g) sale (other than sales of inventory in the Ordinary Course
                      of Business),  lease, or other disposition of any asset or
                      property of any Acquired Company or mortgage,  pledge,  or
                      imposition  of  any  lien  or  other  encumbrance  on  any
                      material  asset  or  property  of  any  Acquired  Company,
                      including the sale,  lease, or other disposition of any of
                      the Intellectual Property Assets;

                  (h) cancellation  or  waiver of any  claims  or rights  with a
                      value to any Acquired Company in excess of $10,000;

                  (i) material change  in the  accounting  methods  used by  any
                      Acquired Company; or

                  (j) agreement,  whether  oral  or  written,  by  any  Acquired
                      Company to do any of the foregoing.

3.17 CONTRACTS; NO DEFAULTS

                  (a) Part 3.17(a) of the Disclosure  Letter contains a complete
                      and accurate list, and Seller have delivered to Buyer true
                      and complete copies, of:

                      (i)    each Applicable Contract that involves  performance
                             of services or  delivery of goods or  materials  by
                             one or more  Acquired  Companies  of an  amount  or
                             value in excess of $10,000;

                      (ii)   each Applicable Contract that involves  performance
                             of services or  delivery of goods or  materials  to
                             one or more  Acquired  Companies  of an  amount  or
                             value in excess of $10,000;

                      (iii)  each Applicable  Contract that was not entered into
                             in  the  Ordinary   Course  of  Business  and  that
                             involves  expenditures  or  receipts of one or more
                             Acquired Companies in excess of $10,000;

                      (iv)   each lease, rental or occupancy agreement, license,
                             installment  and conditional  sale  agreement,  and
                             other Applicable  Contract  affecting the ownership
                             of,  leasing of, title to, use of, or any leasehold
                             or other interest in, any real or personal property
                             (except  personal  property  leases and installment
                             and conditional sales agreements having a value per
                             item or aggregate  payments of less than $5,000 and
                             with terms of less than one year);

                      (v)    each  licensing   agreement  or  other   Applicable
                             Contract  with  respect  to  patents,   trademarks,
                             copyrights,   or   other   intellectual   property,
                             including   agreements   with   current  or  former
                             employees,  consultants,  or contractors  regarding
                             the  appropriation or the  non-disclosure of any of
                             the Intellectual Property Assets;

                      (vi)   each  collective  bargaining  agreement  and  other
                             Applicable  Contract  to or with any labor union or
                             other  employee   representative   of  a  group  of
                             employees;


                                       20
<PAGE>

                      (vii)  each   joint   venture,   partnership,   and  other
                             Applicable  Contract  (however  named)  involving a
                             sharing of profits,  losses,  costs, or liabilities
                             by any Acquired Company with any other Person;

                      (viii) each Applicable Contract containing  covenants that
                             in  any  way  purport  to  restrict   the  business
                             activity of any Acquired  Company or any  Affiliate
                             of an Acquired  Company or limit the freedom of any
                             Acquired  Company or any  Affiliate  of an Acquired
                             Company  to  engage in any line of  business  or to
                             compete with any Person;

                      (ix)   each Applicable  Contract providing for payments to
                             or by any  Person  based on  sales,  purchases,  or
                             profits, other than direct payments for goods;

                      (x)    each power of attorney that is currently  effective
                             and outstanding;

                      (xi)   each Applicable Contract entered into other than in
                             the Ordinary  Course of Business  that  contains or
                             provides for an express undertaking by any Acquired
                             Company  to  be   responsible   for   consequential
                             damages;

                      (xii)  each Applicable  Contract for capital  expenditures
                             in excess  of  $10,000;

                      (xiii) each  written  warranty,  guaranty,  and  or  other
                             similar  undertaking  with  respect to  contractual
                             performance  extended by any Acquired Company other
                             than in the Ordinary Course of Business; and

                      (xiv)  each  amendment,   supplement,   and   modification
                             (whether  oral or written) in respect of any of the
                             foregoing.

         Part 3.17(a) of the Disclosure  Letter sets forth  reasonably  complete
details concerning such Contracts,  including the parties to the Contracts,  the
amount  of  the  remaining  commitment  of  the  Acquired  Companies  under  the
Contracts,  and the Acquired  Companies'  office where  details  relating to the
Contracts are located.

                  (b) Except  as set  forth in Part  3.17(b)  of the  Disclosure
                      Letter:

                      (i)    no Seller (and no Related  Person of either Seller)
                             has or may acquire any rights under,  and no Seller
                             has or may  become  subject  to any  obligation  or
                             liability  under,  any Contract that relates to the
                             business of, or any of the assets owned or used by,
                             any Acquired Company; and

                      (ii)   to  the  Knowledge   of  Seller  and  the  Acquired
                             Companies, no officer,  director,  agent, employee,
                             consultant,  or contractor of any Acquired  Company
                             is bound by any Contract that purports to limit the
                             ability of such officer, director, agent, employee,
                             consultant,  or  contractor  to  (A)  engage  in or
                             continue   any  conduct,   activity,   or  practice
                             relating to the business of any  Acquired  Company,
                             or (B)  assign to any  Acquired  Company  or to any
                             other   Person   any   rights  to  any   invention,
                             improvement, or discovery.


                                       21
<PAGE>

                  (c) Except  as set  forth in Part  3.17(c)  of the  Disclosure
                      Letter,   each  Contract  identified  or  required  to  be
                      identified in Part 3.17(a) of the Disclosure  Letter is in
                      full  force and  effect  and is valid and  enforceable  in
                      accordance with its terms.

                  (d) Except  as set  forth in Part  3.17(d)  of the  Disclosure
                      Letter:

                      (i)    each  Acquired  Company  is, and at all times since
                             December 31, 1996 has been, in full compliance with
                             all  applicable  terms  and  requirements  of  each
                             Contract  under which such Acquired  Company has or
                             had any  obligation  or  liability or by which such
                             Acquired Company or any of the assets owned or used
                             by such Acquired Company is or was bound;

                      (ii)   each other Person that has or had any obligation or
                             liability   under  any  Contract   under  which  an
                             Acquired  Company  has or had any rights is, and at
                             all times since December 31, 1996 has been, in full
                             compliance   with   all   applicable    terms   and
                             requirements of such Contract;

                      (iii)  no event has occurred or  circumstance  exists that
                             (with or  without  notice  or  lapse  of time)  may
                             contravene, conflict with, or result in a violation
                             or breach of, or give any Acquired Company or other
                             Person the right to  declare a default or  exercise
                             any remedy under,  or to accelerate the maturity or
                             performance of, or to cancel, terminate, or modify,
                             any Applicable Contract; and

                      (iv)   no Acquired  Company has given to or received  from
                             any other  Person,  at any time since  December 31,
                             1996,  any notice or other  communication  (whether
                             oral or written)  regarding  any  actual,  alleged,
                             possible,  or potential  violation or breach of, or
                             default under, any Contract.

                  (e) There are no  renegotiations  of, attempts to renegotiate,
                      or outstanding  rights to renegotiate any material amounts
                      paid or payable to any Acquired  Company  under current or
                      completed  Contracts with any Person and, to the Knowledge
                      of Seller and the Acquired  Companies,  no such Person has
                      made written demand for such renegotiation.

                  (f) The Contracts relating to the sale,  design,  manufacture,
                      or  provision  of products  or  services  by the  Acquired
                      Companies have been entered into in the Ordinary Course of
                      Business and have been entered into without the commission
                      of any act alone or in concert with any other  Person,  or
                      any consideration having been paid or promised, that is or
                      would be in violation of any Legal Requirement.

3.18 INSURANCE

                  (a) Seller have delivered to Buyer:

                      (i)    true  and  complete   copies  of  all  policies  of
                             insurance to which any Acquired  Company is a party
                             or  under  which  any  Acquired  Company,   or  any
                             director of any  Acquired  Company,  is or has been
                             covered  at  any  time   within  the  three   years
                             preceding the date of this Agreement; (ii) true and
                             complete  copies of all  pending  applications  for
                             policies of insurance; and


                                       22
<PAGE>

                  (b) Except  as set  forth on Part  3.18(b)  of the  Disclosure
                      Letter:

                      (i)    All  policies  to which any  Acquired  Company is a
                             party or that  provide  coverage to either  Seller,
                             any Acquired Company, or any director or officer of
                             an Acquired Company:

                             (A) are valid,  outstanding,  and enforceable;  (B)
                             are issued by an insurer that is financially
                                   sound and reputable;
                             (C)   taken together, to Seller' knowledge, provide
                                   adequate  insurance  coverage  for the assets
                                   and the operations of the Acquired  Companies
                                   for all risks normally  insured  against by a
                                   Person  carrying  on  the  same  business  or
                                   businesses as the Acquired Companies;
                             (D)   to  Seller'  knowledge,  are  sufficient  for
                                   compliance  with all Legal  Requirements  and
                                   Contracts to which any Acquired  Company is a
                                   party or by which any of them is bound;
                             (E)   will   continue  in  full  force  and  effect
                                   following    the    consummation    of    the
                                   Contemplated Transactions; and
                              F)   do not provide for any  retrospective premium
                                   adjustment    or   other    experienced-based
                                   liability   on  the  part  of  any   Acquired
                                   Company.

                      (ii)   No Seller or Acquired Company has  received (A) any
                             refusal of  coverage  or any notice  that a defense
                             will be afforded with reservation of rights, or (B)
                             any notice of cancellation or any other  indication
                             that any  insurance  policy  is no  longer  in full
                             force or effect or will not be  renewed or that the
                             issuer  of any  policy  is not  willing  or able to
                             perform its obligations thereunder.

                      (iii)  The Acquired  Companies have paid all premiums due,
                             and   have   otherwise   performed   all  of  their
                             respective obligations,  under each policy to which
                             any  Acquired  Company is a party or that  provides
                             coverage  to  any  Acquired   Company  or  director
                             thereof.

                      (iv)   The  Acquired  Companies  have given  notice to the
                             insurer of all claims that may be insured thereby.

3.19 ENVIRONMENTAL MATTERS

Except as set forth in part 3.19 of the Disclosure Letter:

                  (a) Each  Acquired  Company is, and at all times has been,  in
                      full  compliance  with,  and  has not  been  and is not in
                      violation of or liable under,  any  Environmental  Law. No
                      Seller or Acquired  Company  has any basis to expect,  nor
                      has any of them or any other Person for whose conduct they
                      are or may be held to be responsible received,  any actual
                      or Threatened order,  notice, or other  communication from
                      (i) any Governmental Body or private citizen acting in the
                      public  interest,  or (ii) the  current or prior  owner or
                      operator  of any  Facilities,  of any actual or  potential
                      violation or failure to comply with any Environmental Law,
                      or of any actual or Threatened obligation to undertake or

                                       23
<PAGE>

                      bear the cost of any  Environmental,  Health,  and  Safety
                      Liabilities  with respect to any of the  Facilities or any
                      other  properties or assets  (whether real,  personal,  or
                      mixed) in which Seller or any Acquired  Company has had an
                      interest,  or with  respect to any property or Facility at
                      or  to   which   Hazardous   Materials   were   generated,
                      manufactured,  refined,  transferred,  imported,  used, or
                      processed by Seller,  any Acquired  Company,  or any other
                      Person  for  whose   conduct  they  are  or  may  be  held
                      responsible,  or from which Hazardous  Materials have been
                      transported,   treated,   stored,  handled,   transferred,
                      disposed, recycled, or received.

                  (b) There are no pending  or, to the  Knowledge  of Seller and
                      the Acquired Companies,  Threatened claims,  Encumbrances,
                      or other  restrictions  of any nature,  resulting from any
                      Environmental,  Health,  and Safety Liabilities or arising
                      under or pursuant to any  Environmental  Law, with respect
                      to or  affecting  any  of  the  Facilities  or  any  other
                      properties and assets (whether real,  personal,  or mixed)
                      in which  Seller  or any  Acquired  Company  has or had an
                      interest.

                  (c) No Seller or Acquired Company has any basis to expect, nor
                      has any of them or any other Person for whose conduct they
                      are or may be held  responsible,  received,  any citation,
                      directive,  inquiry,  notice, Order, summons,  warning, or
                      other  communication  that relates to Hazardous  Activity,
                      Hazardous Materials, or any alleged,  actual, or potential
                      violation or failure to comply with any Environmental Law,
                      or of any  alleged,  actual,  or potential  obligation  to
                      undertake or bear the cost of any  Environmental,  Health,
                      and  Safety   Liabilities  with  respect  to  any  of  the
                      Facilities  or any other  properties  or  assets  (whether
                      real, personal,  or mixed) in which Seller or any Acquired
                      Company had an  interest,  or with respect to any property
                      or  facility  to  which  Hazardous  Materials   generated,
                      manufactured,  refined,  transferred,  imported,  used, or
                      processed by Seller,  any Acquired  Company,  or any other
                      Person  for  whose   conduct  they  are  or  may  be  held
                      responsible,  have  been  transported,   treated,  stored,
                      handled, transferred, disposed, recycled, or received.

                  (d) No Seller or  Acquired  Company,  or any other  Person for
                      whose conduct they are or may be held responsible, has any
                      Environmental, Health, and Safety Liabilities with respect
                      to the  Facilities  or, to the Knowledge of Seller and the
                      Acquired  Companies,  with respect to any other properties
                      and assets  (whether  real,  personal,  or mixed) in which
                      Seller or any Acquired Company (or any  predecessor),  has
                      or had an  interest,  or at any property  geologically  or
                      hydrologically  adjoining the Facilities or any such other
                      property or assets.

                  (e) There  are no  Hazardous  Materials  present  on or in the
                      Environment  at the Facilities or at any  geologically  or
                      hydrologically adjoining property, including any Hazardous
                      Materials  contained  in  barrels,  above  or  underground
                      storage tanks, landfills,  land deposits, dumps, equipment
                      (whether  moveable or fixed) or other  containers,  either
                      temporary or permanent,  and deposited or located in land,
                      water,  sumps, or any other part of the Facilities or such
                      adjoining  property,  or  incorporated  into any structure
                      therein or thereon. No Seller, Acquired Company, any other
                      Person  for  whose   conduct  they  are  or  may  be  held
                      responsible,  or  to  the  Knowledge  of  Seller  and  the
                      Acquired Companies, any other Person, has permitted or

                                       24
<PAGE>

                      conducted,   or  is  aware  of,  any  Hazardous   Activity
                      conducted  with  respect  to the  Facilities  or any other
                      properties or assets (whether real, personal, or mixed) in
                      which  Seller  or  any  Acquired  Company  has  or  had an
                      interest  except in full  compliance  with all  applicable
                      Environmental Laws.

                  (f) There has been no Release or, to the  Knowledge  of Seller
                      and the  Acquired  Companies,  Threat of  Release,  of any
                      Hazardous  Materials at or from the  Facilities  or at any
                      other  locations   where  any  Hazardous   Materials  were
                      generated,  manufactured,  refined, transferred, produced,
                      imported, used, or processed from or by the Facilities, or
                      from or by any other  properties and assets (whether real,
                      personal,  or  mixed)  in  which  Seller  or any  Acquired
                      Company has or had an  interest,  or to the  Knowledge  of
                      Seller and the  Acquired  Companies  any  geologically  or
                      hydrologically adjoining property,  whether by Seller, any
                      Acquired Company, or any other Person.

                  (g) Seller have  delivered to Buyer true and  complete  copies
                      and results of any reports,  studies,  analyses, tests, or
                      monitoring   possessed  or  initiated  by  Seller  or  any
                      Acquired  Company  pertaining  to  Hazardous  Materials or
                      Hazardous  Activities in, on, or under the Facilities,  or
                      concerning  compliance by Seller, any Acquired Company, or
                      any other Person for whose conduct they are or may be held
                      responsible, with Environmental Laws.

3.20 EMPLOYEES

                  (a) Part 3.20 of the Disclosure Letter contains a complete and
                      accurate  list  of  the  following  information  for  each
                      employee or director of the Acquired Companies,  including
                      each  employee  on  leave of  absence  or  layoff  status:
                      employer;  name; job title;  current  compensation paid or
                      payable and any change in compensation  since December 31,
                      1997; vacation accrued;  and service credited for purposes
                      of  vesting  and  eligibility  to  participate  under  any
                      Acquired  Company's pension,  retirement,  profit-sharing,
                      thrift-savings,  deferred compensation, stock bonus, stock
                      option,  cash bonus,  employee stock ownership  (including
                      investment credit or payroll stock  ownership),  severance
                      pay, insurance,  medical, welfare, or vacation plan, other
                      Employee  Pension Benefit Plan or Employee Welfare Benefit
                      Plan, or any other  employee  benefit plan or any Director
                      Plan.

                  (b) No employee or director of any Acquired Company is a party
                      to,  or  is   otherwise   bound  by,  any   agreement   or
                      arrangement,      including      any      confidentiality,
                      noncompetition,  or proprietary rights agreement,  between
                      such   employee   or   director   and  any  other   Person
                      ("Proprietary Rights Agreement") that in any way adversely
                      affects or will affect (I) the  performance  of his duties
                      as an employee or director of the Acquired  Companies,  or
                      (ii) the  ability of any  Acquired  Company to conduct its
                      business,  including any Proprietary Rights Agreement with
                      Seller or the Acquired  Companies by any such  employee or
                      director. To Seller' Knowledge,  no director,  officer, or
                      other key  employee  of any  Acquired  Company  intends to
                      terminate his employment with such Acquired Company.

                  (c) Part  3.20  of  the  Disclosure  Letter  also  contains  a
                      complete and accurate  list of the  following  information
                      for each  retired  employee or  director  of the  Acquired
                      Companies,  or their  dependents,  receiving  benefits  or
                      scheduled to receive benefits in the future: name, pension
                      benefit,   pension  option   election,   retiree   medical
                      insurance coverage,  retiree life insurance coverage,  and
                      other benefits.


                                       25
<PAGE>

3.21 LABOR RELATIONS; COMPLIANCE

         Since December 31, 1997, no Acquired  Company has been or is a party to
any  collective  bargaining or other labor  Contract.  Since  December 31, 1997,
there has not been, there is not presently  pending or existing,  and to Seller'
Knowledge there is not Threatened,  (a) any strike,  slowdown,  picketing,  work
stoppage, or employee grievance process, (b) any Proceeding against or affecting
any Acquired Company relating to the alleged  violation of any Legal Requirement
pertaining  to labor  relations or employment  matters,  including any charge or
complaint filed by an employee or union with the National Labor Relations Board,
the Equal  Employment  Opportunity  Commission,  or any comparable  Governmental
Body,  organizational  activity, or other labor or employment dispute against or
affecting  any  of  the  Acquired  Companies  or  their  premises,  or  (c)  any
application  for  certification  of a collective  bargaining  agent.  To Seller'
Knowledge no event has occurred or  circumstance  exists that could  provide the
basis for any work stoppage or other labor  dispute.  There is no lockout of any
employees by any Acquired  Company,  and no such action is  contemplated  by any
Acquired  Company.  Each Acquired  Company has complied in all respects with all
Legal  Requirements  relating  to  employment,   equal  employment  opportunity,
nondiscrimination,  immigration,  wages, hours, benefits, collective bargaining,
the payment f social security and similar taxes, occupational safety and health,
and plant  closing.  No  Acquired  Company  is  liable  for the  payment  of any
compensation,  damages,  taxes,  fines,  penalties,  or other  amounts,  however
designated, for failure to comply with any of the foregoing Legal Requirements.

3.22 INTELLECTUAL PROPERTY

                  (a) Intellectual  Property   Assets--The  term   "Intellectual
                      Property Assets" includes:

                      (i)    the name "Pacific  Print",  all fictional  business
                             names,  trading names,  registered and unregistered
                             trademarks,   service   marks,   and   applications
                             (collectively, "Marks");

                      (ii)   all patents,  patent  applications,  and inventions
                             and    discoveries    that   may   be    patentable
                             (collectively, "Patents");

                      (iii)  all  copyrights  in   both  published   works   and
                             unpublished works (collectively, "Copyrights");

                      (iv)   all  rights in mask  works  (collectively,  "Rights
                             in Mask Works"); and

                      (v)    all   know-how,    trade   secrets,    confidential
                             information,  customer lists,  software,  technical
                             information,   data,  process  technology,   plans,
                             drawings,  and blue  prints  (collectively,  "Trade
                             Secrets"); owned, used, or licensed by any Acquired
                             Company as licensee or licensor.

                  (b) Agreements--Part 3.22(b) of the Disclosure Letter contains
                      a complete  and  accurate  list and  summary  description,
                      including any  royalties  paid or received by the Acquired
                      Companies,  of all Contracts  relating to the Intellectual
                      Property  Assets to which any Acquired  Company is a party
                      or by which any Acquired Company is bound,  except for any
                      license  implied by the sale of a product  and  perpetual,
                      paid-up licenses for commonly  available software programs
                      with a value of less than  $5,000  under which an Acquired
                      Company is the licensee.  There are no outstanding and, to
                      Seller' Knowledge, no Threatened disputes or disagreements
                      with respect to any such agreement.




                                       26
<PAGE>

                  (c) Know-How Necessary for the Business

                      (i)    The  Intellectual  Property  Assets  are  all those
                             necessary   for  the   operation  of  the  Acquired
                             Companies'   businesses   as  they  are   currently
                             conducted  or as  reflected  in the  business  plan
                             given  to  Buyer.  One  or  more  of  the  Acquired
                             Companies  is the owner of all  right,  title,  and
                             interest  in  and  to  each  of  the   Intellectual
                             Property  Assets,  free  and  clear  of all  liens,
                             security    interests,    charges,    encumbrances,
                             equities,  and other  adverse  claims,  and has the
                             right to use  without  payment to a third party all
                             of the Intellectual Property Assets.

                      (ii)   Except as   set  forth  in  Part   3.22(c)  of  the
                             Disclosure Letter, all former and current employees
                             of each  Acquired  Company  have  executed  written
                             Contracts   with  one  or  more  of  the   Acquired
                             Companies  that  assign  to  one  or  more  of  the
                             Acquired  Companies  all rights to any  inventions,
                             improvements,  discoveries, or information relating
                             to  the  business  of  any  Acquired  Company.   No
                             employee of any  Acquired  Company has entered into
                             any  Contract  that  restricts or limits in any way
                             the scope or type of work in which the employee may
                             be engaged or requires  the  employee to  transfer,
                             assign, or disclose information concerning his work
                             to anyone  other  than one or more of the  Acquired
                             Companies.

                  (d) Patents

                      (i)    Part  3.22(d)  of the  Disclosure  Letter  contains
                             a   complete   and   accurate   list  and   summary
                             description  of  all  atents.  One or  more  of the
                             Acquired  Companies  is the  owner  of  all  right,
                             title,  and interest in and to each of the Patents,
                             free and clear of all  liens,  security  interests,
                             charges, encumbrances,  entities, and other adverse
                             claims.

                      (ii)   All  of  the  issued   Patents  are   currently  in
                             compliance    with   formal   legal    requirements
                             (including  payment  of  filing,  examination,  and
                             maintenance fees and proofs of working or use), are
                             valid and  enforceable,  and are not subject to any
                             maintenance  fees or taxes or actions  falling  due
                             within ninety days after the Closing Date.

                      (iii)  No  Patent  has  been  or is  now  involved  in any
                             interference, reissue, reexamination, or opposition
                             proceeding.  To  Seller'  Knowledge,  there  is  no
                             potentially    interfering    patent    or   patent
                             application of any third party.

                      (iv)   No Patent is  infringed  or, to Seller'  Knowledge,
                             has been  challenged or threatened in any way. None
                             of the  products  manufactured  and  sold,  nor any
                             process or know-how  used, by any Acquired  Company
                             infringes  or is alleged to infringe  any patent or
                             other proprietary right of any other Person.

                      (v)    All products made,  used, or sold under the Patents
                             have been marked with the proper patent notice.


                                       27
<PAGE>

                  (e) Trademarks

                      (i)    Part  3.22(e)  of  Disclosure   Letter  contains  a
                             complete and accurate list and summary  description
                             of all Marks. One or more of the Acquired Companies
                             is the owner of all right,  title,  and interest in
                             and to each of the  Marks,  free  and  clear of all
                             liens, security interests,  charges,  encumbrances,
                             equities, and other adverse claims.

                      (ii)   All  Marks  that  have  been  registered  with  the
                             United  States  Patent  and  Trademark  Office  are
                             currently  in  compliance  with  all  formal  legal
                             requirements       (including       the      timely
                             post-registration  filing of  affidavits of use and
                             incontestability  and  renewal  applications),  are
                             valid and  enforceable,  and are not subject to any
                             maintenance  fees or taxes or actions  falling  due
                             within ninety days after the Closing Date.

                      (iii)  No  Mark  has  been  or  is  now  involved  in  any
                             opposition,  invalidation,  or cancellation and, to
                             Seller'  Knowledge,  no such  action is  Threatened
                             with the respect to any of the Marks.

                      (iv)   To  Seller'  Knowledge,  there  is  no  potentially
                             interfering  trademark or trademark  application of
                             any third party.

                      (v)    Except  as set  forth  in  Part  3.22(e)(v)  of the
                             Disclosure  Letter,  no Mark is  infringed  or,  to
                             Seller'   Knowledge,   has   been   challenged   or
                             threatened  in any way.  None of the Marks  used by
                             any  Acquired  Company  infringes  or is alleged to
                             infringe any trade name, trademark, or service mark
                             of any third party.

                      (vi)   All products and  materials  containing a Mark bear
                             the  proper  federal   registration   notice  where
                             permitted by law.

                  (f) Copyrights

                      (i)    Part 3.22(f) of the  Disclosure  Letter  contains a
                             complete and accurate list and summary  description
                             of all  Copyrights.  One or  more  of the  Acquired
                             Companies  is the owner of all  right,  title,  and
                             interest in and to each of the Copyrights, free and
                             clear of all liens,  security  interests,  charges,
                             encumbrances, equities, and other adverse claims.

                      (ii)   All the  Copyrights  have been  registered  and are
                             currently   in   compliance   with   formal   legal
                             requirements,  are valid and  enforceable,  and are
                             not  subject  to any  maintenance  fees or taxes or
                             actions  falling  due within  ninety days after the
                             date of Closing.

                      (iii)  No Copyright is infringed or, to Seller' Knowledge,
                             has been  challenged or threatened in any way. None
                             of the  subject  matter  of  any of the  Copyrights
                             infringes or is alleged to infringe  any  copyright
                             of any third party or is a derivative work based on
                             the work of a third party.


                                       28
<PAGE>

                      (iv)  All works  encompassed by the  Copyrights  have been
                            marked with the proper copyright notice.

                  (g) Trade Secrets

                      (i)    With   respect   to   each   Trade   Secret,    the
                             documentation  relating  to such  Trade  Secret  is
                             current,  accurate,  and  sufficient  in detail and
                             content to identify and explain it and to allow its
                             full  and  proper  use  without   reliance  on  the
                             knowledge or memory of any individual.

                      (ii)   Seller and the  Acquired  Companies  have taken all
                             reasonable  precautions  to  protect  the  secrecy,
                             confidentiality, and value of their Trade Secrets.

                      (iii)  One or  more of  the Acquired  Companies  has  good
                             title  and  an   absolute   (but  not   necessarily
                             exclusive)  right  to use the  Trade  Secrets.  The
                             Trade Secrets are not part of the public  knowledge
                             or literature,  and, to Seller' Knowledge, have not
                             been used, divulged, or appropriated either for the
                             benefit  of any Person  (other  than one or more of
                             the Acquired  Companies) or to the detriment of the
                             Acquired  Companies.  No Trade Secret is subject to
                             any  adverse  claim  or  has  been   challenged  or
                             threatened in any way.

3.23 CERTAIN PAYMENTS

         Since  December 31,  1996,  no Acquired  Company or director,  officer,
agent, or employee of any Acquired  Company,  or to Seller'  Knowledge any other
Person associated with or acting for or on behalf of any Acquired  Company,  has
directly or indirectly (a) made any contribution,  gift, bribe, rebate,  payoff,
influence payment,  kickback, or other payment to any Person, private or public,
regardless  of form,  whether  in money,  property,  or  services  (i) to obtain
favorable  treatment in securing business,  (ii) to pay for favorable  treatment
for  business  secured,  (iii) to  obtain  special  concessions  or for  special
concessions  already obtained,  for or in respect of any Acquired Company or any
Affiliate of an Acquired Company, or (iv) in violation of any Legal Requirement,
(b)  established  or maintained  any fund or asset that has not been recorded in
the books and records of the Acquired Companies.

3.24 DISCLOSURE

                  (a) No  representation or warranty of Seller in this Agreement
                      and no statement in the Disclosure Letter omits to state a
                      material fact necessary to make the  statements  herein or
                      therein,  in light of the circumstances in which they were
                      made, not misleading.

                  (b) No notice  given  pursuant to Section 5.5 6.5 will contain
                      any  untrue  statement  or omit to state a  material  fact
                      necessary  to  make  the  statements  therein  or in  this
                      Agreement,  in light of the  circumstances  in which  they
                      were made, not misleading.

                  (c) There  is no fact  known to  either  any  Seller  that has
                      specific  application to either any Seller or any Acquired
                      Company   (other   than   general   economic  or  industry
                      conditions) and that materially  adversely  affects or, as
                      far  as  Seller   can   reasonably   foresee,   materially
                      threatens,  the  assets,  business,  prospects,  financial
                      condition,  or  results  of  operations  of  the  Acquired
                      Companies (on a consolidated  basis) that has not been set
                      forth in this Agreement or the Disclosure Letter.


                                       29
<PAGE>

 3.25 RELATIONSHIPS WITH RELATED PERSONS

         No Seller or any Related  Person of Seller or of any  Acquired  Company
has,  or since [the first day of the next to last  completed  fiscal year of the
Acquired  Companies]  has had,  any  interest  in any  property  (whether  real,
personal, or mixed and whether tangible or intangible), used in or pertaining to
the Acquired Companies' businesses. No Seller or any Related Person of Seller or
of any Acquired Company is, or since the first day of the next to last completed
fiscal year of the  Acquired  Companies  has owned (of record or as a beneficial
owner) an equity interest or any other financial or profit interest in, a Person
that has (i) had  business  dealings  or a material  financial  interest  in any
transaction with any Acquired  Company,  or (ii) engaged in competition with any
Acquired  Company  with  respect to any line of the products or services of such
Acquired Company (a "Competing Business") in any market presently served by such
Acquired  Company  except for less than one percent of the  outstanding  capital
stock of any  Competing  Business  that is  publicly  traded  on any  recognized
exchange or in the over-the-counter  market. Except as set forth in Part 3.25 of
the  Disclosure  Letter,  no  Seller or any  Related  Person of Seller or of any
Acquired  Company  is a party to any  Contract  with,  or has any claim or right
against, any Acquired Company.

3.26 BROKERS OR FINDERS

         Seller and their  agents have  incurred  no  obligation  or  liability,
contingent or otherwise,  for brokerage or finders' fees or agents'  commissions
or other similar payment in connection with this Agreement.

4. REPRESENTATIONS AND WARRANTIES OF BUYER

         Buyer represents and warrants to Seller as follows:

4.1 ORGANIZATION AND GOOD STANDING

         Buyer is a corporation duly organized,  validly  existing,  and in good
standing under the laws of the State of Utah.

4.2 AUTHORITY; NO CONFLICT

                  (a) This Agreement  constitutes the legal,  valid, and binding
                      obligation   of  Buyer,   enforceable   against  Buyer  in
                      accordance with its terms. Upon the execution and delivery
                      by Buyer  of the  Purchase  Price  (the  "Buyer's  Closing
                      Documents"), the Buyer's Closing Documents will constitute
                      the  legal,  valid,  and  binding  obligations  of  Buyer,
                      enforceable   against  Buyer  in  accordance   with  their
                      respective terms.  Buyer has the absolute and unrestricted
                      right,  power,  and  authority to execute and deliver this
                      Agreement and the Buyer's Closing Documents and to perform
                      its  obligations  under  this  Agreement  and the  Buyer's
                      Closing Documents.

                  (b) Except as set forth in Schedule 4.2, neither the execution
                      and   delivery  of  this   Agreement   by  Buyer  nor  the
                      consummation  or  performance  of any of the  Contemplated
                      Transactions  by Buyer  will give any  Person the right to
                      prevent,  delay,  or otherwise  interfere  with any of the
                      Contemplated Transactions pursuant to:

                      (i)    contravene, conflict with, or result in a violation
                             of  (A)  any   provision   of  the   Organizational
                             Documents  of  the  Buyer,  or (B)  any  resolution
                             adopted   by  the   board  of   directors   of  the
                             stockholders of Buyer;


                                       30
<PAGE>

                      (ii)   contravene, conflict with, or result in a violation
                             of, or give any  Governmental  body or other Person
                             the  right  to  challenge  any of the  Contemplated
                             Transactions  or to  exercise  any remedy or obtain
                             any  relief  under,  any Legal  Requirement  of any
                             Order  to  which  Buyer  or  Seller,  or any of the
                             assets owned or used by Buyer, may be subject;

                      (iii)  contravene, conflict with, or result in a violation
                             of any of the terms or requirements of, or give any
                             Governmental  Body the right to  revoke,  withdraw,
                             suspend,   cancel,   terminate,   or  modify,   any
                             Governmental Authorization that is held by Buyer or
                             that  otherwise  relates to the business of, or any
                             of the assets owned or used by Buyer;

                      (iv)   cause  Buyer  or any  Acquired  Company  to  become
                             subject to, or to become liable for the payment of,
                             any Tax;

                      (v)    cause  any of the  assets  owned by any Buyer to be
                             reassessed  or revalued by any taxing  authority or
                             other Governmental Body;

                      (vi)   contravene, conflict with, or result in a violation
                             or breach of any  provision  of, or give any Person
                             the  right to  declare a default  or  exercise  any
                             remedy  under,  or to  accelerate  the  maturity or
                             performance of, or to cancel, terminate, or modify,
                             any material contract of Buyer; or

                      (vii)  result  in  the   imposition  or  creation  of  any
                             Encumbrance  upon  or  with  respect  to any of the
                             assets owned or used by Buyer.

4.3 INVESTMENT INTENT

         Buyer is  acquiring  the Shares for its own account and not with a view
to their distribution within the meaning of Section 2(11) of the Securities Act.

4.4 CERTAIN PROCEEDINGS

         There is no pending  Proceeding  that has been commenced  against Buyer
and that  challenges,  or may have the effect of  preventing,  delaying,  making
illegal, or otherwise interfering with, any of the Contemplated Transactions. To
Buyer's Knowledge, no such Proceeding has been Threatened.

4.5 SEC FILINGS

         Buyer has  furnished  Seller with copies of all Forms  10-KSB and Forms
10-QSB,  which have been filed for all periods since December 31, 1996. All such
documents,  as amended, do not contain any untrue statements nor do they omit to
state any statement  necessary to make the statements made not  misleading.  All
such documents,  as amended, comply with all applicable rules and regulations of
the United States Securities and Exchange Commission.

4.6 BROKERS OR FINDERS

         Buyer and its  officers  and agents  have  incurred  no  obligation  or
liability,  contingent or  otherwise,  for brokerage or finders' fees or agents'
commissions or other similar  payment in connection with this Agreement and will
indemnify and hold Seller harmless from any such payment alleged to be due by or
through Buyer as a result of the action of Buyer or its officers or agents.

                                       31
<PAGE>

5. COVENANTS OF SELLER PRIOR TO CLOSING DATE

5.1 ACCESS AND INVESTIGATION

         Between the date of this  Agreement and the Closing Date,  Seller will,
and will cause each  Acquired  Company  and its  Representatives  to, (a) afford
Buyer and its Representatives and prospective lenders and their  Representatives
(collectively,  "Buyer's  Advisors")  full  and  free  access  to each  Acquired
Company's personnel, properties (including subsurface testing), contracts, books
and  records,  and other  documents  and data,  (b)  furnish  Buyer and  Buyer's
Advisors  with  copies  of all such  contracts,  books  and  records,  and other
existing  documents and data as Buyer may  reasonably  request,  and (c) furnish
Buyer and Buyer's Advisors with such additional financial,  operating, and other
data and information as Buyer may reasonably request.

5.2 OPERATION OF THE BUSINESSES OF THE ACQUIRED COMPANIES

         Between the date of this  Agreement and the Closing Date,  Seller will,
and will cause each Acquired Company to:

                  (a) conduct the business  of such Acquired Company only in the
                      Ordinary Course of Business;

                  (b) use his  Best  Efforts  to  preserve  intact  the  current
                      business  organization  of  such  Acquired  Company,  keep
                      available the services of the current officers, employees,
                      and agents of such  Acquired  Company,  and  maintain  the
                      relations  and  good  will  with   suppliers,   customers,
                      landlords, creditors, employees, agents, and others having
                      business relationships with such Acquired Company;

                  (c) confer with  Buyer concerning  operational  matters  of  a
                      material nature; and

                  (d) otherwise  report  periodically  to Buyer  concerning  the
                      status of the business,  operations,  and finances of such
                      Acquired Company.

5.3 NEGATIVE COVENANT

         Except as otherwise expressly permitted by this Agreement,  between the
date of this  Agreement  and the Closing  Date,  Seller will not, and will cause
each Acquired  Company not to, without the prior written consent of Buyer,  take
any affirmative  action,  or fail to take any reasonable  action within their or
its control, as a result of which any of the changes or events listed in Section
3.16 is likely to occur.

5.4 REQUIRED APPROVALS

         As promptly as  practicable  after the date of this  Agreement,  Seller
will,  and will cause each  Acquired  Company to,  make all filings  required by
Legal  Requirements  to be made by them in order to consummate the  Contemplated
Transactions (including all filings under the HSR Act). Between the date of this
Agreement  and the  Closing  Date,  Seller  will,  and will cause each  Acquired
Company to, (a)  cooperate  with Buyer with  respect to all  filings  that Buyer
elects to make or is required by Legal  Requirements  to make in connection with
the  Contemplated  Transactions,  and (b) cooperate  with Buyer in obtaining all
consents  identified in Schedule 4.2 (including  taking all actions requested by
Buyer to cause early termination of any applicable  waiting period under the HSR
Act).

                                       32
<PAGE>

5.5 NOTIFICATION

         Between the date of this  Agreement and the Closing  Date,  each Seller
will  promptly  notify Buyer in writing if such Seller or any  Acquired  Company
becomes  aware of any fact or condition  that causes or  constitutes a Breach of
any of Seller'  representations and warranties as of the date of this Agreement,
or if such Seller or any Acquired  Company becomes aware of the occurrence after
the date of this  Agreement  of any fact or  condition  that  would  (except  as
expressly  contemplated by this  Agreement)  cause or constitute a Breach of any
such representation or warranty had such representation or warranty been made as
of the time of  occurrence  or discovery of such fact or  condition.  Should any
such  fact or  condition  require  any  change in the  Disclosure  Letter if the
Disclosure Letter were dated the date of the occurrence or discovery of any such
fact or  condition,  Seller will  promptly  deliver to Buyer a supplement to the
Disclosure  Letter specifying such change.  During the same period,  each Seller
will  promptly  notify Buyer of the  occurrence of any Breach of any covenant of
Seller in this  Section 5 or of the  occurrence  of any event  that may make the
satisfaction of the conditions in Section 7 impossible or unlikely.

5.6 PAYMENT OF INDEBTEDNESS BY RELATED PERSONS

         Except as expressly  provided in this Agreement,  Seller will cause all
indebtedness  owed to an Acquired Company by any Seller or any Related Person of
any Seller to be paid in full prior to Closing.

5.7 NO NEGOTIATION

         Until such time, if any, as this  Agreement is  terminated  pursuant to
Section 9, Seller  will not,  and will cause each  Acquired  Company and each of
their  Representatives  not to,  directly or indirectly  solicit,  initiate,  or
encourage any inquiries or proposals from,  discuss or negotiate  with,  provide
any  non-public  information  to, or  consider  the  merits  of any  unsolicited
inquiries  or  proposals  from,  any Person  (other than Buyer)  relating to any
transaction  involving  the sale of the  business  or assets  (other than in the
Ordinary  Course of  Business) of any  Acquired  Company,  or any of the capital
stock  of  any  Acquired  Company,  or  any  merger,   consolidation,   business
combination, or similar transaction involving any Acquired Company.

5.8 BEST EFFORTS

         Between the date of this  Agreement and the Closing  Date,  Seller will
use  their  Best  Efforts  to cause the  conditions  in  Sections  7 and 8 to be
satisfied.

6. COVENANTS OF BUYER PRIOR TO CLOSING DATE

6.1 APPROVALS OF GOVERNMENTAL BODIES

         As  promptly as  practicable  after the date of this  Agreement,  Buyer
will, and will cause each of its Related  Persons to, make all filings  required
by  Legal  Requirements  to be  made  by them  to  consummate  the  Contemplated
Transactions.  Between the date of this  Agreement and the Closing  Date,  Buyer
will, and will cause each Related Person to,  cooperate with Seller with respect
to all  filings  that  Seller  are  required  by Legal  Requirements  to make in
connection with the Contemplated Transactions, and (ii) cooperate with Seller in
obtaining all consents identified in Part 3.2 of the Disclosure Letter; provided
that this  Agreement  will not require Buyer to dispose of or make any change in
any  portion  of  its  business  or to  incur  any  other  burden  to  obtain  a
Governmental Authorization.

6.2 BEST EFFORTS

         Except as set forth in the proviso to Section 6.1,  between the date of
this  Agreement and the Closing  Date,  Buyer will use its Best Efforts to cause
the conditions in Sections 7 and 8 to be satisfied.


                                       33
<PAGE>

7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE

         Buyer's obligation to purchase the Shares and to take the other actions
required to be taken by Buyer at the Closing is subject to the satisfaction,  at
or prior to the Closing,  of each of the following  conditions (any of which may
be waived by Buyer, in whole or in part):

7.1 ACCURACY OF REPRESENTATIONS

                  (a) All of  Seller'  representations  and  warranties  in this
                      Agreement  (considered  collectively),  and  each of these
                      representations and warranties (considered  individually),
                      must have been accurate in all material respects as of the
                      date of  this  Agreement,  and  must  be  accurate  in all
                      material respects as of the Closing Date as if made on the
                      Closing Date,  without  giving effect to any supplement to
                      the Disclosure Letter.

                  (b) Each of Seller' representations and warranties in Sections
                      3.3, 3.4, 3.12,  and 3.24,  must have been accurate in all
                      respects  as of the  date of this  Agreement,  and must be
                      accurate in all respects as of the Closing Date as if made
                      on  the  Closing  Date,   without  giving  effect  to  any
                      supplement to the Disclosure Letter.

7.2 SELLER'S PERFORMANCE

                  (a) All of the  covenants  and  obligations  that  Seller  are
                      required  to perform or to comply  with  pursuant  to this
                      Agreement   at  or  prior  to  the   Closing   (considered
                      collectively), and each of these covenants and obligations
                      (considered  individually),  must have been duly performed
                      and complied with in all material respects.

                  (b) Each document required to be delivered pursuant to Section
                      2.6  must  have  been  delivered,  and  each of the  other
                      covenants  and  obligations  in Sections  5.4 and 5.8 must
                      have been performed and complied with in all respects.

7.3 CONSENTS

         Each  of the  Consents  identified  in  subpart  b of  Part  3.2 of the
Disclosure  Letter,  and each Consent identified in Schedule 4.2, must have been
obtained and must be in full force and effect.

7.4 ADDITIONAL DOCUMENTS

         Each of the following documents must have been delivered to Buyer:

                  (a) such  documents  as Buyer may  reasonably  request for the
                      purpose of (i)  evidencing  the accuracy of any of Seller'
                      representations   and  warranties,   (ii)  evidencing  the
                      performance  by any  Seller of, or the  compliance  by any
                      Seller  with,  any covenant or  obligation  required to be
                      performed  or  complied   with  by  such   Seller,   (iii)
                      evidencing the  satisfaction of any condition  referred to
                      in this  Section  7, or (iv)  otherwise  facilitating  the
                      consummation  or  performance  of any of the  Contemplated
                      Transactions.

7.5 NO PROCEEDINGS

         Since the date of this Agreement, there must not have been commenced or
Threatened  against  Buyer,  or against any Person  affiliated  with Buyer,  any
Proceeding (a) involving any challenge to, or seeking damages or other relief in
connection with, any of the Contemplated Transactions,  or (b) that may have the
effect of preventing,  delaying,  making illegal, or otherwise  interfering with
any of the Contemplated Transactions.

                                       34
<PAGE>

7.6 NO CLAIM REGARDING STOCK OWNERSHIP OR SALE PROCEEDS

         There  must not have been made or  Threatened  by any  Person any claim
asserting that such Person (a) is the holder or the beneficial  owner of, or has
the right to acquire or to obtain beneficial  ownership of, any stock of, or any
other voting,  equity, or ownership interest in, any of the Acquired  Companies,
or (b) is entitled to all or any portion of the Purchase  Price  payable for the
Shares.

7.7 NO PROHIBITION

         Neither the consummation nor the performance of any of the Contemplated
Transactions  will,  directly or indirectly  (with or without notice or lapse of
time),  materially  contravene,  or  conflict  with,  or  result  in a  material
violation of, or cause Buyer or any Person  affiliated  with Buyer to suffer any
material adverse  consequence  under,  (a) any applicable  Legal  Requirement or
Order,  or  (b)  any  Legal  Requirement  or  Order  that  has  been  published,
introduced, or otherwise proposed by or before any Governmental Body.

8. CONDITIONS PRECEDENT TO SELLER'S  OBLIGATION TO CLOSE

         Seller' obligation to exchange the Shares and to take the other actions
required to be taken by Seller at the Closing is subject to the satisfaction, at
or prior to the Closing,  of each of the following  conditions (any of which may
be waived by Seller, in whole or in part):

8.1 ACCURACY OF REPRESENTATIONS

         All  of  Buyer's  representations  and  warranties  in  this  Agreement
(considered  collectively),  and each of these  representations  and  warranties
(considered  individually),  must have been accurate in all material respects as
of the date of this  Agreement and must be accurate in all material  respects as
of the Closing Date as if made on the Closing Date.

8.2 BUYER'S PERFORMANCE

                  (a) All  of  the  covenants  and  obligations  that  Buyer  is
                      required  to perform or to comply  with  pursuant  to this
                      Agreement   at  or  prior  to  the   Closing   (considered
                      collectively), and each of these covenants and obligations
                      (considered  individually),  must have been  performed and
                      complied with in all material respects.

                  (b) Buyer must have delivered  each of the documents  required
                      to be delivered by Buyer pursuant to Section 2.7.

8.3 CONSENTS

         Each  of the  Consents  identified  in  Subpart  b of  Part  3.2 of the
Disclosure Letter must have been obtained and must be in full force and effect.

8.4 ADDITIONAL DOCUMENTS

         Buyer must have  caused the  following  documents  to be  delivered  to
Seller:

                  (a) such  documents as Seller may  reasonably  request for the
                      purpose   of   (i)   evidencing   the   accuracy   of  any
                      representation  or warranty of Buyer,  (ii) evidencing the
                      performance  by Buyer of, or the compliance by Buyer with,
                      any  covenant or  obligation  required to be  performed or
                      complied with by Buyer,  (iii) evidencing the satisfaction
                      of any  condition  referred to in this  Section 8, or (iv)
                      otherwise  facilitating  the  consummation  of  any of the
                      Contemplated Transactions.

                                       35
<PAGE>

8.5 NO INJUNCTION

         There must not be in effect any Legal  Requirement or any injunction or
other Order that (a)  prohibits  the sale of the Shares by Seller to Buyer,  and
(b) has been adopted or issued,  or has otherwise  become  effective,  since the
date of this Agreement.

9. TERMINATION

9.1 TERMINATION EVENTS

         This  Agreement  may, by notice  given prior to or at the  Closing,  be
terminated:

                  (a) By  either  Buyer or Seller  if a  material  Breach of any
                      provision  of this  Agreement  has been  committed  by the
                      other party and such Breach has not been waived;

                  (b)        (i) by Buyer if any of the  conditions in Section 7
                             has not been satisfied as of the Closing Date or if
                             satisfaction  of  such a  condition  is or  becomes
                             impossible (other than through the failure of Buyer
                             to  comply  with.   its   obligations   under  this
                             Agreement)  and Buyer has not waived such condition
                             on or before the Closing Date; or

                      (ii)   by Seller,  if any of the  conditions  in Section 8
                             has not been  satisfied  of the Closing  Date or if
                             satisfaction  of  such a  condition  is or  becomes
                             impossible  (other  than  through  the  failure  of
                             Seller to comply with their  obligations under this
                             Agreement)   and  Seller   have  not  waived   such
                             condition on or before the Closing Date;

                  (c) by mutual consent of Buyer and Seller; or

                  (d) by either  Buyer or Seller if the Closing has not occurred
                      (other than  through  the failure of any party  seeking to
                      terminate   this   Agreement  to  comply  fully  with  its
                      obligations  under this Agreement) on or before August 31,
                      1998, or such later date as the parties may agree upon.

 9.2  EFFECT  OF TERMINATION

         Each party's right of  termination  under Section 9.1 is in addition to
any other rights it may have under this Agreement or otherwise, and the exercise
of a right of termination will not be an election of remedies. If this Agreement
is terminated  pursuant to Section 9.1, all further  obligations  of the parties
under this Agreement  will  terminate,  except that the  obligations in Sections
11.1 and  11.3  will  survive;  provided,  however,  that if this  Agreement  is
terminated  by a party because of the Breach of the Agreement by the other party
or because one or more of the conditions to the terminating  party's obligations
under this  Agreement is not satisfied as a result of the other party's  failure
to comply with its  obligations  under this Agreement,  the terminating  party's
right to pursue all legal remedies will survive such termination unimpaired.


10. INDEMNIFICATION; REMEDIES

10.1 SURVIVAL; RIGHT TO INDEMNIFICATION NOT AFFECTED BY KNOWLEDGE

         All  representations,  warranties,  covenants,  and obligations in this
Agreement,  the Disclosure Letter, the supplements to the Disclosure Letter, the
certificate  delivered pursuant to Section 2.4(a)(v),  and any other certificate
or document delivered  pursuant to this Agreement will survive the Closing.  The
right to indemnification, payment of Damages or other remedy based on such


                                       36
<PAGE>

representations,  warranties, covenants, and obligations will not be affected by
any  investigation  conducted  with  respect to, or any  Knowledge  acquired (or
capable of being  acquired) at any time,  whether  before or after the execution
and delivery of this Agreement or the Closing Date, with respect to the accuracy
or  inaccuracy  of  or  compliance  with,  any  such  representation,  warranty,
covenant,  or obligation.  The waiver of any condition  based on the accuracy of
any representation or warranty,  or on the performance of or compliance with any
covenant or obligation, will not affect the right to indemnification, payment of
Damages, or other remedy based on such representations,  warranties,  covenants,
and obligations.

10.2 INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLER

         Seller, will indemnify and hold harmless Buyer, the Acquired Companies,
and their respective  Representatives,  stockholders,  controlling  persons, and
affiliates  (collectively,  the "Indemnified  Persons") for, and will pay to the
Indemnified Persons the amount of, any loss, liability, claim, damage (including
incidental and consequential damages), expense (including costs of investigation
and defense and reasonable  attorneys' fees) or diminution of value,  whether or
not involving a third-party claim (collectively,  "Damages"),  arising, directly
or indirectly, from or in connection with:

                  (a) any  Breach  of any  representation  or  warranty  made by
                      Seller them in this  Agreement  (without  giving effect to
                      any supplement to the Disclosure  Letter),  the Disclosure
                      Letter,  the supplements to the Disclosure  Letter, or any
                      other  certificate  or document  delivered  by Seller them
                      pursuant to this Agreement;

                  (b) any  Breach  of any  representation  or  warranty  made by
                      Seller them in this Agreement as if such representation or
                      warranty  were made on and as of the Closing  Date without
                      giving effect to any supplement to the Disclosure  Letter,
                      other  than  any  such  Breach  that  is  disclosed  in  a
                      supplement  to the  Disclosure  Letter  and  is  expressly
                      identified  in  the  certificate   delivered  pursuant  to
                      Section 2.7(a)(v) as having caused the condition specified
                      in Section 7.1 not to be satisfied;

                  (c) any Breach by either Seller  of any covenant or obligation
                      of such Seller in this Agreement;

                  (d) any product  shipped or  manufactured  by, or any services
                      provided  by, any  Acquired  Company  prior to the Closing
                      Date;

                  (e) any matter  disclosed  in  parts 3.15  of  the  Disclosure
                      Letter; or

                  (f) any claim by any Person for  brokerage or finder's fees or
                      commissions  or similar  payments based upon any agreement
                      or  understanding  alleged  to have  been made by any such
                      Person with Seller or any Acquired  Company (or any Person
                      acting  on their  behalf)  in  connection  with any of the
                      Contemplated Transactions.

         The remedies  provided in this Section 10.2 will not be exclusive of or
limit any other remedies that may be available to Buyer or the other Indemnified
Persons.

                                       37
<PAGE>

10.3 INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER

         Buyer will indemnify and hold harmless  Seller,  and will pay to Seller
the amount of any Damages arising, directly or indirectly, from or in connection
with (a) any  Breach of any  representation  or  warranty  made by Buyer in this
Agreement or in any  certificate  delivered by Buyer pursuant to this Agreement,
(b) any  Breach  by  Buyer  of any  covenant  or  obligation  of  Buyer  in this
Agreement,  or (c) any claim by any Person for  brokerage  or  finder's  fees or
commissions  or similar  payments  based  upon any  agreement  or  understanding
alleged to have been made by such Person with Buyer (or any Person acting on its
behalf) in connection with any of the Contemplated Transactions.

10.4 TIME LIMITATIONS

         If  the   Closing   occurs,   Seller  will  have  no   liability   (for
indemnification or otherwise) with respect to any representation or warranty, or
covenant or  obligation  to be performed  and complied with prior to the Closing
Date,  other than those in Sections  3.3,  3.11,  3.13,  and 3.19,  unless on or
before March 31, 1999 Buyer  notifies  Seller of a claim  specifying the factual
basis of that claim in  reasonable  detail to the extent then known by Buyer;  a
claim  with  respect  to  Section  3.3,  3.11,  3.13,  or 3.19,  or a claim  for
indemnification  or reimbursement not based upon any  representation or warranty
or any covenant or  obligation  to be performed  and complied  with prior to the
Closing Date, may be made at any time. If the Closing occurs, Buyer will have no
liability (for  indemnification or otherwise) with respect to any representation
or warranty,  or covenant or  obligation to be performed and complied with prior
to the Closing Date, unless on or before March 31, 1999 Seller notify Buyer of a
claim  specifying  the factual basis of that claim in  reasonable  detail to the
extent then known by Seller.

10.5 LIMITATIONS ON AMOUNT--SELLER

         Seller will have no liability (for  indemnification  or otherwise) with
respect to the matters  described  in clause  (a),  clause (b) or, to the extent
relating to any failure to perform or comply prior to the Closing  Date,  clause
(c) of Section  10.2 until the total of all Damages with respect to such matters
exceeds  $5,000,  and then only for the  amount  by which  such  Damages  exceed
$5,000.  Seller will have no liability (for  indemnification  or otherwise) with
respect to the matters  described  in clause (d) of Section 10.2 until the total
of all Damages with respect to such matters  exceeds  $5,000,  and then only for
the amount by which such Damages exceed $5,000.  However, this Section 10.5 will
not apply to any Breach of any of Seller's  representations  and  warranties  of
which  Seller  had  Knowledge  at any  time  prior  to the  date on  which  such
representation  and warranty is made or any intentional  Breach by Seller of any
covenant or obligation,  and Seller, will be liable for all Damages with respect
to such Breaches.

10.6 LIMITATIONS ON AMOUNT--BUYER

         Buyer will have no liability (for  indemnification  or otherwise)  with
respect to the matters  described in clause (a) or (b) of Section 10.4 until the
total of all Damages with respect to such matters exceeds $5,000,  and then only
for the amount by which such Damages exceed $5,000.  However,  this Section 10.6
will not apply to any Breach of any of Buyer's representations and warranties of
which  Buyer  had  Knowledge  at any  time  prior  to the  date  on  which  such
representation  and warranty is made or any  intentional  Breach by Buyer of any
covenant or obligation, and Buyer will be liable for all Damages with respect to
such Breaches.

                                       38
<PAGE>

10.7 PROCEDURE FOR INDEMNIFICATION--THIRD PARTY CLAIMS

                  (a) Promptly  after  receipt  by an  indemnified  party  under
                      Section 10.2 or 10.4, of notice of the commencement of any
                      Proceeding  against it, such indemnified  party will, if a
                      claim is to be made  against an  indemnifying  party under
                      such Section, give notice to the indemnifying party of the
                      commencement of such claim,  but the failure to notify the
                      indemnifying party will not relieve the indemnifying party
                      of any  liability  that  it may  have  to any  indemnified
                      party,  except to the extent that the  indemnifying  party
                      demonstrates that the defense of such action is prejudiced
                      by the indemnifying party's failure to give such notice.

                  (b) If  any  Proceeding  referred  to in  Section  10.7(a)  is
                      brought  against an indemnified  party and it gives notice
                      to the  indemnifying  party  of the  commencement  of such
                      Proceeding,  the indemnifying party will, unless the claim
                      involves   Taxes,  be  entitled  to  participate  in  such
                      Proceeding  and, to the extent that it wishes  (unless (i)
                      the indemnifying  party is also a party to such Proceeding
                      and the  indemnified  party  determines in good faith that
                      joint representation  would be inappropriate,  or (ii) the
                      indemnifying party fails to provide  reasonable  assurance
                      to the  indemnified  party of its  financial  capacity  to
                      defend such  Proceeding and provide  indemnification  with
                      respect to such Proceeding), to assume the defense of such
                      Proceeding  with counsel  satisfactory  to the indemnified
                      party and, after notice from the indemnifying party to the
                      indemnified party of its election to assume the defense of
                      such Proceeding,  the indemnifying party will not, as long
                      as it diligently  conducts such defense,  be liable to the
                      indemnified  party  under this  Section 10 for any fees of
                      other  counsel or any other  expenses  with respect to the
                      defense  of such  Proceeding,  in each  case  subsequently
                      incurred by the  indemnified  party in connection with the
                      defense of such Proceeding, other than reasonable costs of
                      investigation.  If  the  indemnifying  party  assumes  the
                      defense  of a  Proceeding,  (i) it  will  be  conclusively
                      established for purposes of this Agreement that the claims
                      made  in that  Proceeding  are  within  the  scope  of and
                      subject  to   indemnification;   (ii)  no   compromise  or
                      settlement   of  such   claims  may  be  effected  by  the
                      indemnifying party without the indemnified party's consent
                      unless  (A)  there  is no  finding  or  admission  of  any
                      violation of Legal  Requirements  or any  violation of the
                      rights of any  Person  and no  effect on any other  claims
                      that may be made against the  indemnified  party,  and (B)
                      the sole relief provided is monetary damages that are paid
                      in  full  by  the   indemnifying   party;  and  (iii)  the
                      indemnified  party will have no liability  with respect to
                      any  compromise  or  settlement  of such  claims  effected
                      without its consent. If notice is given to an indemnifying
                      party  of the  commencement  of  any  Proceeding  and  the
                      indemnifying  party  does not,  within  ten days after the
                      indemnified  party's  notice is given,  give notice to the
                      indemnified party of its election to assume the defense of
                      such Proceeding,  the indemnifying  party will be bound by
                      any   determination   made  in  such   Proceeding  or  any
                      compromise  or  settlement  effected  by  the  indemnified
                      party.

                                       39
<PAGE>


                  (c) Notwithstanding  the foregoing,  if an  indemnified  party
                      determines  in  good  faith  that  there  is a  reasonable
                      probability  that a Proceeding may adversely  affect it or
                      its affiliates  other than as a result of monetary damages
                      for which it would be  entitled to  indemnification  under
                      this Agreement,  the  indemnified  party may, by notice to
                      the  indemnifying  party,  assume the  exclusive  right to
                      defend,  compromise,  or settle such  Proceeding,  but the
                      indemnifying  party will not be bound by any determination
                      of  a  Proceeding   so  defended  or  any   compromise  or
                      settlement  effected without its consent (which may not be
                      unreasonably withheld).

                  (d) Seller hereby consent to the non-exclusive jurisdiction of
                      any court in which a  Proceeding  is brought  against  any
                      Indemnified  Person  for  purposes  of any  claim  that an
                      Indemnified  Person  may have under  this  Agreement  with
                      respect to such Proceeding or the matters alleged therein,
                      and agree  that  process  may be  served  on  Seller  with
                      respect to such a claim anywhere in the world.

10.8 PROCEDURE FOR INDEMNIFICATION--OTHER CLAIMS

         A claim for  indemnification for any matter not involving a third-party
claim  may be  asserted  by notice to the  party  from whom  indemnification  is
sought.

11. GENERAL PROVISIONS

11.1 EXPENSES

         Except as otherwise expressly provided in this Agreement, each party to
this Agreement will bear its respective expenses incurred in connection with the
preparation,  execution,  and performance of this Agreement and the Contemplated
Transactions,  including  all  fees and  expenses  of  agents,  representatives,
counsel,  and  accountants.  In the event of termination of this Agreement,  the
obligation  of each party to pay its own expenses  will be subject to any rights
of such party arising from a breach of this Agreement by another party.

11.2 PUBLIC ANNOUNCEMENTS

         Any public  announcement  or  similar  publicity  with  respect to this
Agreement or the Contemplated  Transactions  will be issued,  if at all, at such
time and in such manner as Buyer  determines.  Unless  consented  to by Buyer in
advance or required by Legal  Requirements,  prior to the Closing  Seller shall,
and  shall  cause the  Acquired  Companies  to,  keep  this  Agreement  strictly
confidential  and may not make any  disclosure of this  Agreement to any Person.
Seller and Buyer will consult with each other  concerning the means by which the
Acquired  Companies'  employees,  customers,  and  suppliers  and others  having
dealings  with the  Acquired  Companies  will be  informed  of the  Contemplated
Transactions,  and  Buyer  will  have  the  right  to be  present  for any  such
communication.

11.3 CONFIDENTIALITY

         Between  the date of this  Agreement  and the Closing  Date,  Buyer and
Seller will  maintain in  confidence,  and will cause the  directors,  officers,
employees,  agents, and advisors of Buyer and the Acquired Companies to maintain
in  confidence,  and not use to the  detriment  of another  party or an Acquired
Company any written,  oral, or other  information  obtained in  confidence  from
another party or an Acquired  Company in connection  with this  Agreement or the
Contemplated Transactions,  unless (a) such information is already known to such
party or to others not bound by a duty of  confidentiality  or such  information
becomes publicly  available  through no fault of such party, (b) the use of such
information  is necessary or  appropriate  in making any filing or obtaining any
consent  or  approval   required  for  the   consummation  of  the  Contemplated
Transactions,  or (c) the  furnishing or use of such  information is required by
legal proceedings.


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<PAGE>

         If the Contemplated  Transactions are not consummated,  each party will
return or destroy as much of such  written  information  as the other  party may
reasonably request.

11.4 NOTICES

         All notices,  consents,  waivers,  and other  communications under this
Agreement must be in writing and will be deemed to have been duly given when (a)
delivered by hand (with written confirmation of receipt), (b) sent by telecopier
(with  written  confirmation  of  receipt),  provided  that a copy is  mailed by
registered  mail,  return  receipt  requested,  or  (c)  when  received  by  the
addressee,  if  sent  by a  nationally  recognized  overnight  delivery  service
(receipt  requested),  in each case to the appropriate  addresses and telecopier
numbers set forth below (or to such other addresses and telecopier  numbers as a
party may designate by notice to the other parties):


Seller:                            Quade, Inc.
                   Attention:      Mr. Robert Mintz
                                   Clubroom 1384 Broadway
                                   New York, New York 10018
                   Facsimile:      (212) 221-7210

                   With Copy To:    Arthur ER. Rosenberg
                                    Gilbert, Segall and Young, LLP
                                    430 Park Avenue
                                    New York, New York 10022
                   Facsimile #:     (212) 644-4051

Buyer:                              American Resources and Development Company
                   Attention:       Karl Badger
                                    102 West 500 South, Suite 318
                                    Salt Lake City, Utah 84101
                   Facsimile:       (801) 363-8487

11.5 JURISDICTION; SERVICE OF PROCESS

         Any action or proceeding  seeking to enforce any provision of, or based
on any right arising out of, this  Agreement  may be brought  against any of the
parties in the courts of the State of Utah,  County of Salt Lake,  or, if it has
or can acquire jurisdiction, in the United States District Court for the Central
District of Utah, and each of the parties  consents to the  jurisdiction of such
courts  (and  of the  appropriate  appellate  courts)  in  any  such  action  or
proceeding and waives any objection to venue laid therein. Process in any action
or proceeding  referred to in the preceding  sentence may be served on any party
anywhere in the world.

11.6 FURTHER ASSURANCES

         The  parties  agree (a) to  furnish  upon  request  to each  other such
further  information,  (b) to  execute  and  deliver  to each  other  such other
documents,  and (c) to do such other acts and things, all as the other party may
reasonably  request for the purpose of carrying out the intent of this Agreement
and the documents referred to in this Agreement.

11.7 WAIVER

         The rights and remedies of the parties to this Agreement are cumulative
and  not  alternative.  Neither  the  failure  nor any  delay  by any  party  in
exercising any right,  power, or privilege under this Agreement or the documents
referred to in this Agreement will operate as a waiver of such right,  power, or
privilege,  and no single or  partial  exercise  of any such  right,  power,  or
privilege will preclude any other or further  exercise of such right,  power, or
privilege  or the  exercise of any other  right,  power,  or  privilege.  To the
maximum extent permitted by applicable law, (a) no claim or right arising out of

                                       41
<PAGE>

this Agreement or the documents  referred to in this Agreement can be discharged
by one party,  in whole or in part, by a waiver or  renunciation of the claim or
right  unless in writing  signed by the other  party;  (b) no waiver that may be
given by a party will be applicable except in the specific instance for which it
is given;  and (c) no  notice  to or demand on one party  will be deemed to be a
waiver of any  obligation of such party or of the right of the party giving such
notice or demand to take further  action without notice or demand as provided in
this Agreement or the documents referred to in this Agreement.

11.8 ENTIRE AGREEMENT AND MODIFICATION

         This Agreement supersedes all prior agreements between the parties with
respect to its subject matter  (including the Letter of Intent between Buyer and
Seller dated March 16, 1998) and constitutes  (along with the documents referred
to in this  Agreement)  a complete and  exclusive  statement of the terms of the
agreement between the parties with respect to its subject matter. This Agreement
may not be amended  except by a written  agreement  executed  by the party to be
charged with the amendment.

11.9 DISCLOSURE LETTER

                  (a) The disclosures in the Disclosure Letter, and those in any
                      Supplement    thereto,    must    relate   only   to   the
                      representations  and  warranties  in  the  Section  of the
                      Agreement  to which they  expressly  relate and not to any
                      other representation or warranty in this Agreement.

                  (b) In the event of any  inconsistency  between the statements
                      in the body of this  Agreement and those in the Disclosure
                      Letter  (other than an  exception  expressly  set forth as
                      such  in  the   Disclosure   Letter  with   respect  to  a
                      specifically identified  representation or warranty),  the
                      statements in the body of this Agreement will control.

11.10 ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS

         Neither party may assign any of its rights under this Agreement without
the prior consent of the other parties,  which consent will not be  unreasonably
withheld, except that Buyer may assign any of its rights under this Agreement to
any Subsidiary of Buyer. Subject to the preceding sentence,  this Agreement will
apply to, be  binding  in all  respects  upon,  and inure to the  benefit of the
successors and permitted  assigns of the parties.  Nothing expressed or referred
to in this Agreement will be construed to give any Person other than the parties
to this Agreement any legal or equitable right,  remedy,  or claim under or with
respect to this Agreement or any provision of this Agreement. This Agreement and
all of its provisions  and conditions are for the sole and exclusive  benefit of
the parties to this Agreement and their successors and assigns.

11.11 SEVERABILITY

         If any provision of this Agreement is held invalid or  unenforceable by
any court of competent jurisdiction, the other provisions of this Agreement will
remain in full force and effect. Any provision of this Agreement held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.

11.12 SECTION HEADINGS, CONSTRUCTION

         The headings of Sections in this Agreement are provided for convenience
only and will not affect its construction or  interpretation.  All references to
"Section" or "Sections" refer to the  corresponding  Section or Sections of this
Agreement.  All words used in this  Agreement  will be  construed  to be of such
gender  or number  as the  circumstances  require.  Unless  otherwise  expressly
provided, the word "including" does not limit the preceding words or terms.

11.13 TIME OF ESSENCE

         With  regard to all dates and time  periods set forth or referred to in
this Agreement, time is of the essence.


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<PAGE>

11.14 GOVERNING LAW

         This  Agreement  will be  governed  by the  laws of the  State  of Utah
without regard to conflicts of laws principles.

11.15 COUNTERPARTS

         This  Agreement  may be executed in one or more  counterparts,  each of
which will be deemed to be an original copy of this  Agreement and all of which,
when taken together, will be deemed to constitute one and the same agreement.

         IN WITNESS  WHEREOF,  the parties  have  executed  and  delivered  this
Agreement as of the date first written above.

Buyer:   American Resources and Development Company


/s/ Will Papenfuss 
------------------------------
(Will Papenfuss, President)

Seller:



/s/ Robert Mintz 
------------------------------
(Robert Mintz)

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