Document:

Certificate of Designations

 EXHIBIT 4.1 
 CERTIFICATE OF DESIGNATIONS 
 OF 
 FIXED TO FLOATING RATE PERPETUAL NON-CUMULATIVE 
 PREFERRED STOCK, SERIES A

 OF 
 THE COLONIAL
BANCGROUP, INC. 
 The Colonial BancGroup, Inc., a Delaware corporation (the “Corporation”), DOES
HEREBY CERTIFY: 
 That the following resolutions were duly adopted by the Board of Directors of the
Corporation (the “Board of Directors”) at a meeting duly convened and held on April 18, 2007 and by the Special Committee (the “Committee”) of the Board of Directors by unanimous written consent filed with the proceedings of
the Board of Directors on May 21, 2007 pursuant to authority conferred upon the Board of Directors by the provisions of the certificate of incorporation of the Corporation authorizing the Corporation to issue up to 50,000,000 shares of
preferred stock, par value $2.50 per share, and pursuant to authority conferred upon the Committee in accordance with Section 141(c) of the General Corporation Law of the State of Delaware: 
 1. On April 18, 2007 the Board of Directors adopted the following resolution authorizing the Committee to act on behalf of the Board
of Directors in connection with the issuance of a new series of Preferred Stock: 
 “RESOLVED, that the Special Committee is hereby authorized, empowered and directed, for and on behalf of BancGroup, to approve the specific rights and preferences of the BancGroup Preferred Stock,
as well as the form of the related certificate of designations.” 
 2. On May 15, 2007, the Committee, pursuant to
the authority conferred upon it by Section 141(c) of the General Corporation Law of the State of Delaware and resolutions of the Board of Directors adopted on April 18, 2007, duly adopted the following resolution: 
 “RESOLVED, that pursuant to a resolution of the Board of Directors of BancGroup adopted on April 18, 2007, the issuance
of a series of BancGroup Preferred Stock is hereby authorized, and the designation, voting powers, preferences and relative, participating, optional and other special rights, and qualifications, limitations and restrictions thereof, of the shares of
such series, in addition to those set forth in the certificate of incorporation of BancGroup, are hereby fixed as set forth in the Certificate of Designations attached hereto as Exhibit A; and further” 

 Section 1. Designation. The distinctive serial designation of such series is
“Fixed-to-Floating Rate Perpetual Non-cumulative Preferred Stock, Series A” (“Series A”). Each share of Series A shall be identical in all respects to every other share of Series A. 
 Section 2. Number of Shares. The number of shares of Series A shall be 300,000. Such number may from time to time be increased (but not
in excess of the total number of authorized shares of Preferred Stock) or decreased (but not below the number of shares of Series A then outstanding) by the Board of Directors. Shares of Series A that are redeemed, purchased or otherwise
acquired by the Corporation shall be cancelled and shall revert to authorized but unissued shares of Preferred Stock undesignated as to series. 
 Section 3. Definitions. As used herein with respect to Series A: 
 “Business Day”
means any day other than a Saturday, Sunday or any other day on which banks in New York, New York or Montgomery, Alabama are generally required or authorized by law to be closed. 
 “CBG Preferred Stock” means the Fixed-to-Floating Rate Perpetual Non-cumulative Preferred Stock, Class A, Series A
of CBG Florida REIT Corp., a Florida corporation, offered for sale by an Offering Circular, dated May 15, 2007. 
 “Colonial Bank” means Colonial Bank, National Association, a national banking association headquartered in Montgomery, Alabama. 
 “Comparable Treasury Issue” means the United States Treasury security selected by the Independent Investment Banker as having a maturity comparable to the term remaining to May 15, 2012 that
would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of perpetual preferred securities having similar terms as the Series A with respect to the payment of dividends and distributions
of assets upon liquidation, dissolution or winding up of the issuer of such preferred securities. 
 “Comparable
Treasury Price” means, with respect to any redemption date for the Series A, the average of the Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest of such Reference Treasury Dealer
Quotations, or if the Independent Investment Banker obtains fewer than five such Reference treasury Dealer Quotations, the average of all such quotations. 
 “Dividend Payment Date” has the meaning specified in Section 4(a). 
 “Dividend Period” has the meaning specified in Section 4(a). 
 “Five-Year
Date” means the Dividend Payment Date in May 2012 and the Dividend Payment Date in May of each fifth succeeding year. 
  

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 “Junior Stock” means the Common Stock and any other class or series of
stock of the Corporation hereafter authorized over which Series A has preference or priority in the payment of dividends or in the distribution of assets on any liquidation, dissolution or winding up of the Corporation. 
 “Independent Investment Banker” means an independent investment banking institution of national standing appointed by the
Corporation. 
 “LIBOR Business Day” means any day on which commercial banks are open for general business
(including dealings in deposits in U.S. dollars) in London. 
 “LIBOR Determination Date” means, as to each
Dividend Period, the date that is two LIBOR Business Days prior to the first day of such Dividend Period. 
 “Page
LIBOR 01” means the display page of Reuter’s screen designated as LIBOR 01 (or such other page as may replace that page on that service, or such other service as may be nominated as the information vendor, for the purpose of displaying
rates comparable to 3-Month USD LIBOR). 
 “Parity Stock” means any other class or series of stock of the
Corporation that ranks on a parity with Series A in the payment of dividends and in the distribution of assets on any liquidation, dissolution or winding up of the Corporation. 
 “Primary Regulator” means the Office of the Comptroller of the Currency or such successor regulator as may become
Colonial Bank’s primary regulator. 
 “Rating Agencies” means, at any time, Standard &
Poor’s Rating Services, a Division or the McGraw-Hill Corporation, Inc., Moody’s Investors Service, Inc. and Fitch, Inc., but only in the case of each such agency if it is rating the shares of Series A or, if none of them is providing a
rating for the shares of Series A at such time, then any “nationally recognized statistical rating organization” as the phrase is defined for purposes of Rule 436(g)(2) under the Securities Act, that is rating such relevant
security. 
 “Rating Agency Event” means when the Corporation reasonably determines that any Rating Agency
amends, clarifies or changes the criteria it uses to assign equity credit to securities such as the shares of Series A, which amendment, clarification or change results in (i) the shortening of the length of time the shares of Series A are
assigned a particular level of equity credit by that Rating Agency as compared to the length of time they would have been assigned that level of equity credit by that Rating Agency or its predecessor on the issue date of the CBG Preferred Stock, or
(ii) the lowering of the equity credit (including up to a lesser amount) assigned to the shares of Series A by that rating 

  

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agency as compared to the equity credit assigned by that rating agency or its predecessor on the issue date of the CBG Preferred Stock. 
 “Reference Treasury Dealer Quotations” means, with respect to the Reference Treasury Dealer and any redemption date, the
average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed, in each case, as a percentage of its principal amount) quoted in writing to the Independent Investment Banker by
such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day preceding such redemption date. 
 “Regulatory Capital Event” means when the Corporation determines that there is more than an insubstantial risk that the shares of Series A will no longer be of a type that constitutes Tier I capital of the Corporation for
purposes of the capital adequacy guidelines issued by the Board of Governors of the Federal Reserve System applicable to bank holding companies, in either case as a result of a change in applicable laws, regulations or related interpretations after
issuance of the CBG Preferred Stock. 
 “Securities Act” means the Securities Act of 1933, as amended.

 “3-Month USD LIBOR” means, with respect to any Dividend Period, a rate determined on the basis of the
offered rates for three-month U.S. dollar deposits of not less than a principal amount equal to that which is representative for a single transaction in such market at such time, commencing on the first day of such Dividend Period, which appears on
Page LIBOR 01 as of approximately 11:00 A.M., London time, on the LIBOR Determination Date for such Dividend Period. If on any LIBOR Determination Date no rate appears on Page LIBOR 01 as of approximately 11:00 A.M., London time, the
Corporation or another affiliate of the Corporation on behalf of the Corporation will on such LIBOR Determination Date request four major reference banks in the London interbank market selected by the Corporation to provide the Corporation with a
quotation of the rate at which three-month deposits in U.S. dollars, commencing on the first day of such Dividend Period, are offered by them to prime banks in the London interbank market as of approximately 11:00 A.M., London time, on such
LIBOR Determination Date and in a principal amount equal to that which is representative for a single transaction in such market at such time. If at least two such quotations are provided, 3-Month USD LIBOR for such Dividend Period will be the
arithmetic mean (rounded upward if necessary to the nearest .00001 of 1%) of such quotations as calculated by the Corporation. If fewer than two quotations are provided, 3-Month USD LIBOR for such Dividend Period will be the arithmetic mean (rounded
upward if necessary to the nearest .00001 of 1%) of the rates quoted as of approximately 11:00 A.M., New York time, on the first day of such Dividend Period by three major banks in New York, New York selected by the Corporation
for loans in U.S. dollars to leading European banks, for a 

  

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three-month period commencing on the first day of such Dividend Period and in a principal amount of not less than $1,000,000. 
 “Treasury Rate” means the rate per year equal to the quarterly equivalent yield to maturity of the Comparable Treasury
Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date. The Treasury Rate will be calculated on the third Business Day
preceding the redemption date. 
 Section 4. Dividends. 
 (a) Rate. Holders of the shares of Series A shall be entitled to receive, if, as and when declared by the Board of Directors of the Corporation or
any duly authorized committee of the Board of Directors of the Corporation, but only out of assets legally available therefor, non-cumulative cash dividends on the liquidation preference of $1,000 per share of Series A, and no more, payable
quarterly on each February 15, May 15, August 15 and November 15 or, if any such day is not a Business Day, the next Business Day, commencing in the case of whichever of clause (i) or clause (ii) is applicable
on the first such date after issuance of the shares of Series A (each a “Dividend Payment Date”). The period from and including the initial issue date of the Series A or the immediately preceding Dividend Payment Date, as the
case may be, to but excluding the next Dividend Payment Date is a “Dividend Period.” If no shares of Series A have been issued prior to May 15, 2012, upon issuance thereafter a Dividend Payment Date shall be deemed to have
occurred on the date of issuance, if such issuance date is a Dividend Payment Date or, if such issuance date is not a Dividend Payment Date, on the immediately preceding Dividend Payment Date for purposes of determining the dividend rate. Dividends
accrue in each Dividend Period from the first day of such Dividend Period, whether or not dividends are paid with respect to any prior Dividend Period. Dividends on each share of Series A will accrue on the liquidation preference of $1,000 per share
(i) for each Dividend Period ending on or prior to the Dividend Payment Date in May 2012 at a rate per annum equal to 7.114%, and (ii) thereafter for each related Dividend Period at a rate per annum equal to 3-Month USD LIBOR
plus 2.02%. The record date for the payment of dividends, if declared, will be the first Business Day of the month in which the relevant dividend payment occurs. Dividends payable on the shares of Series A for any Dividend Period ending prior to or
in May 2012 will be calculated on the basis of a 360-day year consisting of twelve 30-day months, and dividends payable on the shares of Series A for any subsequent Dividend Period will be computed on the basis of a 360-day year and the number of
days actually elapsed. Dividends payable on the shares of Series A for any period less than a full Dividend Period will be computed on the basis of (i) a 360-day year, twelve 30-day months and the number of days actually elapsed in such
Dividend Period for any Dividend Periods ending prior to or in May 2012 and (ii) a 360-day year and the number of days actually elapsed in the relevant Dividend Period for any Dividend Periods thereafter. No interest will be paid on any
dividend payment on the shares of Series A. 
  

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 (b) Non-Cumulative Dividends. Dividends on shares of Series A shall be non-cumulative. To
the extent that any dividends payable on the shares of Series A on any Dividend Payment Date are not declared and paid, in full or otherwise, on such dividend payment date, then such unpaid dividends shall not cumulate and shall cease to accrue and
be payable and the Corporation shall have no obligation to pay, and the holders of shares of Series A shall have no right to receive, dividends accrued for such Dividend Period after the Dividend Payment Date for such Dividend Period or interest
with respect to such dividends, whether or not dividends are declared for any subsequent Dividend Period with respect to shares of Series A, Parity Stock, Junior Stock or any other class or series of authorized preferred stock of the Corporation.

 (c) Priority of Dividends. So long as any shares of Series A remains outstanding, (i) no dividend shall be declared or
paid or set aside for payment and no distribution shall be declared or made or set aside for payment on any Junior Stock, other than a dividend payable solely in Junior Stock of the same class or series or Junior Stock ranking junior to that class
or series, (ii) no shares of Junior Stock shall be repurchased, redeemed or otherwise acquired for consideration by the Corporation, directly or indirectly (other than as a result of a reclassification of Junior Stock for or into Junior Stock,
or the exchange or conversion of one share of Junior Stock for or into another share of Junior Stock) nor shall any monies be paid to or made available for a sinking fund for the redemption of any such securities by the Corporation and (iii) no
shares of Parity Stock shall be repurchased, redeemed or otherwise acquired for consideration by the Corporation otherwise than pursuant to pro rata offers to purchase all, or a pro rata portion, of the shares of Series A and such
Parity Stock except by conversion into or exchange for Junior Stock, in each case unless full dividends on all outstanding shares of series A for the then-current Dividend Period have been paid in full or declared and a sum sufficient for the
payment thereof set aside. When dividends are not paid in full upon, or a sum sufficient for such payment is not set apart for, all the shares of Series A and any Parity Stock, all dividends declared upon shares of Series A and any Parity Stock
shall be declared on a proportional basis so that the amount of dividends declared per share will bear to each other the same ratio that accrued dividends for the then-current Dividend Period per share on the shares of Series A, and accrued
dividends, including any accumulations on Parity Stock, bear to each other. No interest will be payable in respect of any dividend payment on shares of Series A that may be in arrears. If the Board of Directors of the Corporation determines not to
pay any dividend or a full dividend on a Dividend Payment Date, the Corporation will provide, or cause to be provided, written notice to the holders of the shares of Series A prior to such date. Subject to the foregoing, and not otherwise, such
dividends (payable in cash, stock or otherwise) as may be determined by the Board of Directors of the Corporation or any duly authorized committee of the Board of Directors of the Corporation may be declared and paid on any Junior Stock from time to
time out of any assets legally available therefor, and the shares of Series A shall not be entitled to participate in any such dividend. 
  

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 Section 5. Liquidation Rights. 
 (a) Involuntary Liquidation. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation,
holders of Series A shall be entitled, before any distribution or payment out of the assets of the Corporation may be made to or set aside for the holders of any Junior Stock, to receive in full an amount equal to $1,000 per share (the
“liquidation preference”), together with an amount equal to declared but unpaid dividends for the current Dividend Period to the date of liquidation. 
 (b) Partial Payment. If the assets of the Corporation are not sufficient to pay the liquidation preference in full to all holders of Series A and all holders of any Parity Stock, the amounts paid to the
holders of Series A and to the holders of all Parity Stock shall be pro rata in accordance with the respective aggregate liquidation preferences of Series A and all such Parity Stock. 
 (c) Residual Distributions. If the liquidation preference has been paid in full to all holders of Series A and all holders of any Parity
Stock, the holders of Junior Stock shall be entitled to receive all remaining assets of the Corporation according to their respective rights and preferences. 
 (d) Merger, Consolidation and Sale of Assets Not Liquidation. For purposes of this Section 5, the merger or consolidation of the Corporation with any other corporation, including a merger in which the
holders of Series A receive cash or property for their shares, or the sale of all or substantially all of the assets of the Corporation, shall not constitute a liquidation, dissolution or winding up of the Corporation. 
 Section 6. Redemption. 
 (a)
Optional Redemption. If (i) the Corporation had paid all dividends previously declared for payment and (ii) in the event that the redemption date is also a Dividend Payment Date, the Corporation has first declared full dividends on the
Series A then, the Corporation, at the option of its Board of Directors or any duly authorized committee of the Board of Directors of the Corporation, may redeem the shares of Series A at the time outstanding: 
 (i) in whole or in part, on the Dividend Payment Date that is a Five-Year Date at a cash redemption price equal to $1,000 per share of
Series A; 
 (ii) in whole but not in part, at any time prior to May 15, 2012, within 90 days after the occurrence
of a Regulatory Capital Event or a Rating Agency Event, at a cash redemption price equal to the greater of: (A) $1,000 per share of Series A, or (B) the sum of the present values of $1,000 per share of Series A, discounted from
May 15, 2012 to the redemption date, and the present values of all undeclared dividends for 

  

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each Dividend Period from the redemption date to and including May 15, 2012, discounted from their applicable Dividend Payment Dates to the redemption
date, in each case on a quarterly basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate, as calculated by an Independent Investment Banker, plus 0.500%; plus, if the redemption date is not a Dividend
Payment Date, accumulated dividends for the period from, and including, the last Dividend Payment Date to, but excluding, the redemption date; 
 (iii) in whole but not in part, on any Dividend Payment Date prior to May 15, 2012 for any reason other than the occurrence of a Regulatory Capital Event or a Rating Agency Event, at a cash redemption price equal
to the greater of: (A) $1,000 per share of Series A, or (B) the sum of the present values of $1,000 per share of Series A, discounted from May 15, 2012 to the redemption date, and the present values of all undeclared dividends
for each Dividend Period from the redemption date to and including May 15, 2012, discounted from their applicable Dividend Payment Dates to the redemption date, in each case on a quarterly basis (assuming a 360-day year consisting of twelve
30-day months) at the Treasury Rate, as calculated by an Independent Investment Banker, plus 0.375%; plus, if the redemption date is not a Dividend Payment Date, accumulated dividends for the period from, and including, the last
Dividend Payment Date to, but excluding, the redemption date; 
 (iv) in whole but not in part, on any Dividend Payment Date
after the Dividend Payment Date in May 2012 that is not a Five-Year Date, within 90 days the occurrence of a Regulatory Capital Event or a Rating Agency Event, at a cash redemption price of $1,000 per share of Series A, plus, if the
redemption date is not a Dividend Payment Date, accumulated dividends from the period from, and including, the last Dividend Payment Date to, but excluding, the redemption date; 
 (v) in whole but not in part on any Dividend Payment Date after the Dividend Payment Date in May 2012 that is not a Five-Year Date, for
any reason other than the occurrence of a Regulatory Capital Event or a Rating Agency Event, at a cash redemption price equal to the greater of: (A) 1,000 per share of Series A, or (B) the sum of the present value of $1,000 per share of
Series A, discounted from the next succeeding Five-Year Date to the redemption date, and the present values of all undeclared dividends for the Dividend Periods from the redemption date to, and including, the next succeeding Five-Year Date,
discounted from their applicable Dividend Payment Dates to the redemption date, in each case on a quarterly basis (assuming a 360-day year consisting of twelve 30-day months) at the 3-Month USD LIBOR Rate applicable to the Dividend Period
immediately preceding such redemption date (which 3-Month USD LIBOR Rate will also, for purposes of calculating such 

  

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redemption price, be the rate used in calculating the amount for each such undeclared dividend), as calculated by an Independent Investment Banker; plus,
if the redemption date is not a Dividend Payment Date, accumulated dividends for the period from, and including, the last Dividend Payment Date to, but excluding, the redemption date; 
 in each case, without accumulation of any undeclared dividends with respect to Dividend Payment Dates prior to the redemption date. 
 (b) Notice of Redemption. Notice of every redemption of shares of Series A shall be mailed by first class mail, postage prepaid, addressed
to the holders of record of such shares to be redeemed at their respective last addresses appearing on the stock register of the Corporation. Such mailing shall be at least 30 days and not more than 60 days before the date fixed for redemption.
Notwithstanding the foregoing, if the shares of Series A are held in book-entry form through DTC, the Corporation may give such notice in any manner permitted by DTC. Any notice mailed as provided in this Section 6(b) shall be conclusively
presumed to have been duly given, whether or not the holder receives such notice, but failure duly to give such notice by mail, or any defect in such notice or in the mailing thereof, to any holder of shares of shares of Series A designated for
redemption shall not affect the validity of the proceedings for the redemption of any other shares of Series A. Each notice shall state (i) the redemption date; (ii) the number of shares of Series A to be redeemed and, if fewer than
all the shares held by such holder are to be redeemed, the number of such shares to be redeemed by such holder; (iii) the redemption price; (iv) the place or places where the certificates for such shares are to be surrendered for payment
of the redemption price; and (v) that dividends on the shares to be redeemed will cease to accrue on the redemption date. 
 (c)
Partial Redemption. In case of any redemption of only part of the shares of Series A at the time outstanding, the shares of Series A to be redeemed shall be selected either pro rata from the holders of record of Series A in
proportion to the number of shares of Series A held by such holders or by lot or in such other manner as the Board of Directors of the Corporation or any duly authorized committee of the Board of Directors of the Corporation may determine to be fair
and equitable. Subject to the provisions of this Section 6(c), the Board of Directors of the Corporation or any duly authorized committee of the Board of Directors shall have full power and authority to prescribe the terms and conditions upon
which shares of Series A shall be redeemed from time to time. 
 (d) Effectiveness of Redemption. If notice of redemption has
been duly given and if on or before the redemption date specified in the notice all funds necessary for the redemption have been set aside by the Corporation, separate and apart from its other assets, in trust for the pro rata benefit of the
holders of the shares called for redemption, so as to be and continue to be available therefor, or deposited by the Corporation with a bank or trust company selected by the Board of Directors of the Corporation or any duly authorized committee of
the Board of Directors (the “Depositary Company”) in trust for the pro rata benefit of the holders of the shares called for 

  

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redemption, then, notwithstanding that any certificate for any share so called for redemption has not been surrendered for cancellation, on and after the
redemption date all shares so called for redemption shall cease to be outstanding, all dividends with respect to such shares shall cease to accrue after such redemption date, and all rights with respect to such shares shall forthwith on such
redemption date cease and terminate, except only the right of the holders thereof to receive the amount payable on such redemption from such Depositary Company at any time after the redemption date from the funds so deposited, without interest. The
Corporation shall be entitled to receive, from time to time, from the Depositary Company any interest accrued on such funds, and the holders of any shares called for redemption shall have no claim to any such interest. Any funds so deposited and
unclaimed at the end of three years from the redemption date shall, to the extent permitted by law, be released or repaid to the Corporation, and in the event of such repayment to the Corporation, the holders of record of the shares so called for
redemption shall be deemed to be unsecured creditors of the Corporation for an amount equivalent to the amount deposited as stated above for the redemption of such shares and so repaid to the Corporation, but shall in no event be entitled to any
interest. 
 Section 7. Voting Rights. 
 (a) General. The holders of Series A shall not have any voting rights except as set forth below or as otherwise from to time required by law. 
 (b) Right To Elect Two Directors Upon Dividend Defaults. If and whenever the Corporation fails to pay, or declare and set aside for payments full
dividends on Series A or any class or series of Parity Stock (any such class or series being herein referred to in this section as “Dividend Parity Stock”) for at least six Dividend Periods or their equivalent, whether or not
consecutive, the number of directors then constituting the Board of Directors shall be increased by two and the holders of Series A, together with the holders of all other affected classes and series of Dividend Parity Stock similarly entitled
to vote for the election of two additional directors, voting together as a single and separate class, shall be entitled to elect the two additional directors at any annual meeting of stockholders. This right will continue at each subsequent annual
meeting until the earlier of the redemption of all Series A or the Corporation pays dividends in full on the Series A and any additional affected Dividend Parity Stock for three consecutive Dividend Periods or their equivalent and pays or declares
and sets aside for payment dividends in full for the fourth consecutive Dividend Period or its equivalent, at which time the right of the holders of Series A and such Dividend Parity Stock to elect such additional two directors shall cease (but
subject always to the same provisions for the vesting of such voting rights in the case of any similar future arrearages in dividends), and the terms of office of all persons elected as directors by the holders of Series A and such Dividend
Parity Stock shall forthwith terminate and the number of directors constituting the Board of Directors shall be reduced accordingly. In case any vacancy shall occur among the directors elected by the holders of Series A and such Dividend Parity
Stock, a successor shall be elected by the Board of Directors to serve until the next annual meeting of the stockholders upon the 

  

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nomination of the then remaining director elected by the holders of Series A and such Dividend Parity Stock or the successor of such remaining director.

 (c) Other Voting Rights. So long as any shares of Series A are outstanding, in addition to any other vote
or consent of stockholders required by law or by the certificate of incorporation, the vote or consent of the holders of at least 66 2/3% of the shares of Series A at the time outstanding, voting separately as a single class with all Parity Stock that by its terms is entitled to vote thereon, given in
person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, shall be necessary for effecting or validating: 
 (i) Amendment of Certificate of Incorporation. Any amendment, alteration or repeal of any provision of the certificate of
incorporation or by-laws of the Corporation that would alter or change the voting powers, preferences or special rights of the Series A so as to affect them adversely; 
 (ii) Authorization of Senior Stock. Any amendment or alteration of the certificate of incorporation to authorize or create, or
increase the authorized amount of, any shares of any class or series or any securities convertible into shares of any class or series of capital stock of the Corporation ranking prior to Series A in the payment of dividends or in the
distribution of assets on any liquidation, dissolution or winding up of the Corporation; or 
 (iii) Certain Mergers and
Consolidations. The consummation of a binding share exchange or reclassification involving the Series A or a merger or consolidation of the Corporation with another entity, except holders of Series A will have no right to vote under this
provision or otherwise under Delaware law if in each case (i) the shares of Series A remain outstanding or, in the case of any such merger or consolidation with respect to which the Corporation is not the surviving or resulting entity, are
converted into or exchanged for preference securities of the surviving or resulting entity or its ultimate parent, and (ii) such shares of Series A remaining outstanding or such preference securities, as the case may be, have such rights,
preferences, privileges and voting powers, taken as a whole, as are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers of the Series A, taken as a whole; 
 provided, however, that any increase in the amount of the authorized or issued shares of Series A or authorized preferred stock or any
securities convertible into preferred stock or the creation and issuance, or an increase in the authorized or issued amount, of other series of preferred stock or any securities convertible into preferred stock ranking equally with and/or junior to
the Series A with respect to the payment of dividends (whether such dividends are cumulative or non- 

  

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cumulative) and/or the distribution of assets upon the Corporation’s liquidation, dissolution or winding-up will not be deemed to adversely affect the
voting powers, preferences or special rights of the Series A and, notwithstanding any provision of Delaware law, holders of shares of Series A will have no right to vote on such an increase. 
 If an amendment, alteration, repeal, share exchange, reclassification, merger or consolidation described above would adversely affect one or more but not
all series of Parity Stock (including the Series A for this purpose), then only those series affected and entitled to vote shall vote as a class in lieu of all series of preferred stock. 
 The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required is
effected, all outstanding shares of Series A have been redeemed or called for redemption upon proper notice and sufficient funds have been set aside by the Corporation for the benefit of the holders of the Series A to effect such redemption.

 Section 8. Other Rights. The shares of Series A shall not have any voting powers, preferences or relative, participating,
optional or other special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or in the certificate of incorporation of the Corporation. 
 Section 9. Restatement of Certificate. Upon any restatement of the certificate of incorporation of the Corporation, Sections 1 through 8 of
this certificate of designations shall be included in Article IV of the certificate of incorporation under the heading “Fixed-to-Floating Rate Perpetual Non-cumulative Preferred Stock, Series A” and this Section 9 may be omitted.
If the Board of Directors so determines, the numbering of Sections 1 through 8 may be changed for convenience of reference or for any other proper purpose.” 
 IN WITNESS WHEREOF, the Corporation has caused this certificate to be signed by Kamal
Hosein, its Treasurer, this 21st day of May, 2007. 
  

			
	  

	By:	 	Kamal Hosein
	Its:	 	Treasurer

  

 -12-exhibit_10-1.htm

EXHIBIT 10.1

 

AGREEMENT AND PLAN OF MERGER

 

This Agreement and Plan of Merger ("Agreement"), is made and entered into this 7th day of August 2009, by and among CRC
CRYSTAL RESEARCH CORPORATION, a Nevada Corporation ("CRC"), ARIZONA QUARTZ TECH, INC., an Arizona Corporation ("AZQT”). CRC, and AZQT are hereinafter sometimes collectively referred to as the "Parties."

 

RECITALS:

 

A.           CRC desires to acquire all of the issued and outstanding capital stock of AZQT, through a merger with and into CRC (the "Merger"), with
CRC as the surviving corporation of the Merger.

 

B.           It is the intention of the parties hereto that: (i) the Merger shall qualify as a tax free reorganization under Section 368 of the Internal Revenue Code of 1986, as amended, and related
sections thereunder; and the parties intend this Agreement to qualify as a "plan of reorganization" within the meaning of Treasury Regulation Sections 1.368-2(g) and 1.368-3(a), and (ii) the Merger shall qualify as a transaction in securities exempt from registration or qualification under the Securities Act of 1933, as amended, and under the applicable securities laws of each state or jurisdiction where the CRC Security Holders reside.

 

C.           The board of directors of each of CRC, and AZQT and the CRC Security
Holders each deem it to be in the best interests of CRC and AZQT and their respective shareholders to consummate the Merger, as a result of which CRC shall acquire all of the issued and outstanding capital stock of AZQT.

 

NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations and warranties contained in this Agreement, the parties hereto agree as follows:

 

CERTAIN DEFINITIONS

 

As used in this Agreement, the following terms shall have the meanings set forth below:

 

"Applicable Law" means any domestic or foreign law, statute, regulation, rule, policy, guideline or ordinance applicable to the businesses of the Parties, the Merger and/or the Parties.

 

"Articles of Merger" shall mean the certificate of merger of AZQT with and into CRC pursuant to the NRS.

 

"Business Day" shall mean any day, excluding Saturday or Sunday or any other day on which national banks located in Arizona shall be closed for business.

 

"dollar" and "$" means lawful money of the United States of America.

 

"CRC Common Stock" shall mean the shares of common stock of CRC, $.001 par value per share.

 

 

 

Page 1 of 19

 

 

 

"CRC Fully-Diluted Common Stock" means, as at the time in question, the maximum number shares of CRC Common Stock that are issued and outstanding, after giving effect to: (a) the issuance of all of the Merger Shares; and (b) the issuance of any other shares of CRC Common Stock
that are issuable upon conversion of any CRC notes or shares of CRC Preferred Stock, or upon the exercise of options, warrants or other rights to purchase shares of CRC capital stock, but only to the extent that such securities are (i) outstanding as at the Effective Time of the Merger, or (ii) issued subsequent to the Effective Time of the Merger.

 

"CRC Preferred Stock" means the shares of preferred stock of CRC, $.001 par value per share.

 

"Effective Time" shall mean the date upon which the Merger of CRC into AZQT shall be consummated pursuant to the filing of the Articles of Merger with the Secretary of State of Nevada.

 

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

 

"GAAP" means generally accepted accounting principles in the United States of America as promulgated by the American Institute of Certified Public Accountants and the Financial Accounting Standards Board or any successor Institutes concerning the treatment of any accounting matter.

 

"Investor Questionnaire" means those certain documents provided to AZQT by the CRC Security Holders establishing accredited investor status as defined in Rule 501 of Regulation D.

 

"Knowledge" means the knowledge after reasonable inquiry.

 

"Lien" means, with respect to any property or asset, any mortgage, lien, pledge, charge, security interest, encumbrance or other adverse claim of any kind in respect of such property or asset.

 

"Material Adverse Effect" with respect to any entity or group of entities means any event, change or effect that has or would have a materially adverse effect on the financial condition, business or results of operations of such entity or group of entities, taken as a consolidated whole.

 

"Merger Shares" shall mean that number of shares of CRC Common Stock or Preferred Stock to be issued to the AZQT Security Holders on the Closing Date and as at the Effective Time of the Merger.

"NRS" means the Nevada Revised Statutes.

 

"Person" means any individual, corporation, partnership, trust or unincorporated organization or a government or any agency or political subdivision thereof.

 

 

 

 

Page 2 of 19

 

 

 

"AZQT Common Stock" shall mean the shares of common stock of AZQT, $0.01 par value per share.

 

"AZQT Fully-Diluted Common Stock" means the maximum number shares of AZQT Common Stock that are issued and outstanding at the Effective Time of the Merger, plus all additional shares of AZQT Common Stock that would be issuable at the Effective Time of the Merger upon the exercise of all outstanding options, warrants or other rights
to purchase shares of AZQT capital stock.

 

"AZQT Principal Executive Officer" shall mean the Chairman or anyone of the Board of Directors, the President and Chief Executive Officer, respectively, of AZQT.

 

"AZQT Securities" means, as at the date in question, all of the issued and outstanding equity securities of AZQT, consisting of the AZQT Common Stock and (if applicable) any AZQT Preferred Stock.

 

"AZQT Security Holders" means the collective reference to all of the record holders of the AZQT Securities at the Effective Time of the Merger, including the AZQT Principal Executive Officers.

 

"Stock Subscription Agreement" means that certain agreement by and between CRC and the AZQT Security Holders providing for the acquisition by the CRC Security Holders of the AZQT Common Stock.

 

"Surviving Entity" shall mean CRC as the surviving entity in the Merger as provided in Section 1.1.

 

"Tax" (and, with correlative meaning, "Taxes" and "Taxable") means:

 

(i) any income, alternative or add-on minimum tax, gross receipts tax, sales tax, use tax, ad valorem tax, transfer tax, franchise tax, profits tax, license tax, withholding tax, payroll tax, employment tax, excise tax, severance tax, stamp tax, occupation tax, property tax, environmental or windfall profit tax, custom, duty or other
tax, impost, levy, governmental fee or other like assessment or charge of any kind whatsoever together with any interest or any penalty, addition to tax or additional amount imposed with respect thereto by any governmental or Tax authority responsible for the imposition of any such tax (domestic or foreign), and

 

(ii) any responsibility for the payment of any amounts of the type described in clause (i)  above as a result of being a member of an affiliated, consolidated, combined or unitary group for any Taxable period, and

 

(iii) any responsibility for the payment of any amounts of the type described in clauses (i) or (ii) above as a result of any express or implied obligation to indemnify any other person.

 

 

 

Page 3 of 19

 

 

 

"Tax Return" means any return, declaration,· form, claim for refund or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

 

THE MERGER

 

SECTION 1. THE MERGER: EFFECTIVE TIME.

 

1.1           The Merger. At the Effective Time and subject to and upon the terms and conditions of this Agreement, AZQT shall merge with and into CRC in accordance with the provisions of the NRS, the separate corporate
existence of AZQT shall cease and CRC shall continue as the Surviving Entity, with AZQT as a fully owned subsidiary of CRC. The Effective Time of the Merger shall occur upon the filing of the Articles of Merger executed in accordance with the applicable provisions of the NRS with the Secretary of State of Nevada, or at such later time as may be agreed to by CRC and AZQT and specified in the Certificate of Merger subject to the satisfaction or waiver of each of the conditions set forth in Section 4. The date on
which the Effective Time occurs is referred to as the "Effective Date." Provided that this Agreement has not been terminated, the Parties will cause the Articles of Merger to be filed on the Closing Date, as hereafter defined in Section 1.3.

 

(a)           Upon the terms and subject to the conditions set forth in this Agreement and in accordance with the NRS, at the Effective Time, all AZQT Securities shall be converted into the right to receive the Merger Shares existing and to be issued by CRC.

 

(b)           Exchange Agent. , Joseph L. Pittera, Esq. shall act as the exchange agent (the "Exchange Agent") for the purpose of
exchanging AZQT Securities for the Merger Shares. At or within thirty (30) days after the Effective Date, CRC shall deliver to the Exchange Agent certificates evidencing the Merger Shares. The Merger Shares issued at the Effective Time of the Merger shall be registered in the names of the AZQT Security Holders.

 

1.2           Conversion of Securities.

 

(a)           Conversion of AZQT Securities. At the Effective Time, by virtue of the Merger and without any action on the part of CRC, AZQT or the holders of any of their respective securities:

(i)             Each one of the common shares of AZQT Common Stock issued and outstanding immediately prior to the Effective Time shall be converted into a total of 1,000,000 common shares
of CRC to be distributed among the AZQT shareholders according to the list attached hereto as Exhibit “A.”

 

(ii)            All AZQT Securities shall no longer be outstanding and shall automatically be canceled and retired and shall cease to exist, and each holder of a certificate representing any such AZQT Securities shall cease to have any rights with respect thereto, except
the right to receive the Merger Shares to be issued pursuant to this Section 1.2(a) (fractional shares may be issued rounded to the hundredth decimal point) upon the surrender of such certificate in accordance with Section 1.8, without interest.

 

 

 

Page 4 of 19

 

 

 

(iii)           Each AZQT Share that immediately prior to the Effective Time is held by AZQT as a treasury share shall be cancelled and retired without payment of any consideration therefore and without any conversion thereof into a right to receive the Merger Shares.

 

1.3           Closing.

 

The closing of the Merger (the "Closing") will take place at the offices of Joseph L. Pittera Esq., counsel to AZQT, at their office in Torrance, California, within one (1) Business Day following the satisfaction or waiver of the conditions precedent set forth in Section 4 or at such other date as CRC, and AZQT shall agree (the "Closing
Date"), but in no event shall the Closing Date occur later than August 7, 2009.

 

1.4           Effect Of The Merger.

 

At the Effective Time, all the properties, rights, privileges, powers and franchises of AZQT  shall vest in CRC, and all debts, liabilities and duties of AZQT shall become the debts, liabilities and duties of CRC.

 

1.5           Certificate Of Incorporation and Bylaws; Directors And Officers. Prior to the Effective Time of the Merger:

(a)           The Certificate of Incorporation of CRC are made a part hereof shall be the Certificate of Incorporation of CRC following the Merger. The Bylaws of CRC are made a part hereof shall be the Bylaws of CRC following the Merger.

(b)           The initial board of directors of AZQT subsequent to the Merger shall consist of Daniel Gura and Doug Hermanson. The officers of CRC subsequent to the Merger shall be the current officers of CRC.

 

1.6           Further Actions.

 

(a)           After closing and upon issuance of CRC Common Stock to Security Holders AZQT shall transfer its outstanding common stock to CRC.

 

(b)           If, at any time after the Effective Time, CRC considers or is advised that any deeds, bills of sale, assignments, assurances or any other actions or things are necessary or desirable
to vest, perfect or confirm (of record or otherwise) in CRC its right, title or interest in, to or under any of the rights, properties, or assets of AZQT, or otherwise to carry out the intent and purposes of this Agreement, the officers and directors of CRC will be authorized to execute and deliver, in the name and on behalf of each of AZQT and CRC, all such deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf of each of AZQT and CRC, all such other actions and things
as the Board of Directors of CRC may determine to be necessary or desirable to vest, perfect or confirm any and all right, title and interest in, to and under such rights, properties or assets in CRC or otherwise to carry out the intent and purposes of this Agreement.

 

 

 

Page 5 of 19

 

 

 

1.7           Restrictions On Resale

 

( a)           The Merger Shares. The Merger Shares will not be registered under the Securities Act, or the securities laws of any state, and cannot be transferred, hypothecated, sold or otherwise disposed of until:
(i) a registration statement with respect to such securities is declared effective under the Securities Act, or (ii) CRC receives an opinion of counsel for the stockholder, reasonably satisfactory to counsel for CRC, that an exemption from the registration requirements of the Securities Act is available.

 

 

The certificates representing the Merger Shares to be issued on the Effective Date pursuant to this Agreement shall contain a legend substantially as follows:

 

	"THE SECURITIES WHICH ARE REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNTIL A REGISTRATION STATEMENT WITH RESPECT THERETO IS DECLARED EFFECTIVE UNDER SUCH ACT."

 

1.8           Exchange of Certificates.

 

(a)           After the Effective Time and pursuant to a customary letter of transmittal or other instructional form provided by the Exchange Agent to the AZQT Security Holders, the AZQT Security
Holders shall be required to surrender all their AZQT Securities to the Exchange Agent, and the AZQT Security Holders shall be entitled upon such surrender to receive in exchange therefor certificates representing the number of Merger Shares into which the AZQT Securities theretofore represented by the stock transfer forms so surrendered shall have been exchanged pursuant to this Agreement. Until so surrendered, each outstanding certificate, which, prior to the Effective Time, represented AZQT Securities, shall
be deemed for all corporate purpose, subject to the further provisions of this Article I, to evidence the ownership of the number of whole Merger Shares for which such AZQT Securities have been so exchanged. No dividend payable to holders of Merger Shares of record as of any Date subsequent to the Effective Time shall be paid to the owner of any certificate which, prior to the Effective Time, represented AZQT Securities, until such certificate or certificates representing all the relevant AZQT Securities, together
with a stock transfer form, are surrendered as provided in this Article I or pursuant to letters of transmittal or other instructions with respect to lost certificates provided by the Exchange Agent.

 

(b)           All Merger Shares for which the AZQT Securities shall have been exchanged pursuant to this Article I shall be deemed to have been issued in full satisfaction of all rights pertaining
to the AZQT Securities.

 

(c)           On the Effective Date, the stock transfer book of AZQT shall be deemed to be closed and no transfer of AZQT Securities shall thereafter be recorded thereon.

 

 

 

 

Page 6 of 19

 

 

SECTION 2. REPRESENTATIONS AND WARRANTIES OF AZQT

 

AZQT hereby represents and warrants as follows:

 

2.1            Organization and Good Standing: Ownership of Shares. AZQT is a corporation duly organized and validly existing under the laws of the State of Arizona. There are no outstanding subscriptions, rights,
options, warrants or other agreements obligating AZQT to issue, sell or transfer any stock or other securities of AZQT other than those represented in Schedule A.

 

2.2            Corporate Authority. AZQT has the corporate power to enter into this Agreement and to perform its respective obligations hereunder. The execution and delivery of this Agreement and the consummation
of the transaction contemplated hereby have been duly authorized by the Board of Directors of AZQT. The execution and performance of this Agreement will not constitute a material breach of any agreement, indenture, mortgage, license or other instrument or document to which AZQT is a party and will not violate any judgment, decree, order, writ, rule, statute, or regulation applicable to AZQT or its properties. The execution and performance of this Agreement will not violate or conflict with any provision of the
respective Articles of Incorporation or bylaws of AZQT.

 

2.3            Ownership of Shares. The AZQT Security Holders are the owners of record and beneficially of all of the issued and outstanding restricted shares of AZQT Common Stock, options and warrants to purchase
shares of AZQT Common Stock, which AZQT Securities, to the best of AZQT's knowledge, are owned free and clear of all rights, claims, liens and encumbrances, and have not been sold, pledged, assigned or otherwise transferred except pursuant to this Agreement.

 

2.4           Financial Statements, Books and Records. Will consist of the unaudited financial Statements (balance sheet, income Statement, notes) of AZQT as of the Closing Date (the "Financial Statements"). The Financial
Statements fairly represent the financial position of AZQT as at such Dates and the results of their operations for the periods then ended. The books of account and other financial records of AZQT are in all respects complete and correct in all material respects and are maintained in accordance with good business and accountings practices, and are capable of being audited.

 

2.5           Access to Records. The corporate financial records, minute books and other documents and records of AZQT have been
made available to CRC prior to the Closing hereof.

 

2.6           No Material Adverse Changes. Between the execution and Closing of this Agreement, there shall not have been:

 

(a)           any material adverse change in the financial position of AZQT except changes arising in the ordinary course of business, which changes will in noevent materially and adversely affect the financial position of AZQT;

(b)           any damage, destruction or loss materially affecting the assets, prospective business, operations or condition (financial or otherwise) of AZQT whether or not covered by insurance;

 

 

 

Page 7 of 19

 

 

(c)           any declaration, setting aside or payment of any dividend or distribution with respect to any redemption or repurchase of AZQT capital stock;

 

(d)           any sale of an asset (other than in the ordinary course of business) or any mortgage or pledge by AZQT of any properties or assets, other than as set forth in Sections 2.13 or 2.14
below; or

 

(e)           adoption of any pension, profit sharing, retirement, stock bonus, stock option or similar plan or arrangement.

 

2.7            Taxes. AZQT as of the Closing Date, has filed all material tax, governmental and/or related forms and reports (or extensions thereof) due or required to be filed and has (or will have) paid or made
adequate provisions for all taxes or assessments which had become due as of the Closing Date and there are no deficiency notices outstanding.

 

2.8            Compliance with Laws. AZQT has complied with all federal, State, county and local laws, ordinances, regulations, inspections, orders, judgments, injunctions, awards or decrees applicable to it
or its business which, if not complied with, would materially and adversely affect the business of AZQT.

 

2.9           No Breach. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated
hereby will not:

 

(a)            violate any provision of the Articles of Incorporation or Bylaws of AZQT;

 

(b)           violate, conflict with or result in the breach of any of the Terms of, result in a material modification of, otherwise give any other contracting party the right to terminate, or constitute (or with notice or lapse of time, or both constitute) a default under any contract
or other agreement to which AZQT is a party or by or to which it or any of its assets or properties may be bound or subject;

 

(c)           violate any order, judgment, injunction, award or decree of any court, arbitrator or governmental or regulatory body against, or binding upon, AZQT or upon the properties or business of AZQT; or

 

(d)           violate any statute, law or regulation of any jurisdiction applicable to the transactions contemplated herein which could have a materially adverse effect on the business or operations
of AZQT.

 

2.10          Actions and Proceedings. AZQT is not a party to any material pending litigation or, to its knowledge, any governmental investigation or proceeding not reflected in the AZQT Financial Statements, and to its best
knowledge, no material litigation, claims, assessments or non-governmental proceedings are threatened against AZQT.

 

2.11          Agreements. There are no material contract or arrangement to which AZQT is a party or by or to which it or its assets, properties or business are bound or subject, whether written or oral.

 

2.12          Brokers or Finders. No broker's or finder's fee will be payable by AZQT in connection with the transactions contemplated by this
Agreement, nor will any such fee be incurred as a result of any actions by AZQT or any of its Shareholders.

 

 

 

 

Page 8 of 19

 

 

 

2.13          Real Estate. AZQT owns no real property.

 

2.14          Tangible Assets. AZQT has full title and interest in all machinery, equipment, furniture, leasehold improvements, fixtures, projects, owned or leased by AZQT, any related capitalized items or other tangible property
material to the business of AZQT (the "Tangible Assets"). AZQT holds all rights, title and interest in all the Tangible Assets owned by it on the Balance Sheet or acquired by it after the Date on the Balance Sheet free and clear of all liens, pledges, mortgages, security interests, conditional sales contracts or any other encumbrances. All of the Tangible Assets are in good operating condition and repair and are usable in the ordinary course of business of AZQT and conform to all applicable laws, ordinances and
government orders, rules and regulations relating to their construction and operation.

 

2.15          Liabilities. AZQT did not have any direct or indirect indebtedness, liability, claim, loss, damage, deficiency, obligation or responsibility, known or unknown, fixed or unfixed, liquidated or unliquidated, secured
or unsecured, accrued or absolute contingent or otherwise, including, without limitation, any liability on account of taxes, any governmental charge or lawsuit (all of the foregoing collectively defined to as "Liabilities"), which are not fully, fairly and adequately reflected on the Financial Statement except for specific Liabilities set forth in the Unaudited Financial Statements and as declared in Schedule A. As of the Date of Closing, AZQT will not have any further Liabilities, other than Liabilities fully
and adequately reflected on the Financial Statements and as per Schedule A except for Liabilities incurred in the ordinary course of business. There is no circumstance, condition, event or arrangement which may hereafter give rise to any Liabilities not in the ordinary course of business.

 

2.16          Operations of AZQT. Between the execution and Closing of this Agreement, AZQT shall not have:

 

(a)           incurred any indebtedness or borrowed money;

 

(b)           declared or paid any dividend or declared or made any distribution of any kind to any shareholder, or made any direct or indirect redemption, retirement, purchase or other acquisition
of any shares in its capital stock;

 

(c)           made any loan or advance to any shareholder, officer, director, employee, consultant, agent Of other representative or made any
other loan or advance otherwise than in the ordinary course of business;

(d)           except in the ordinary course of business, incurred or assumed anyindebtedness or liability (whether or not currently due and payable);

 

(e)           disposed of any assets of AZQT except in the ordinary course of business;

 

(f)            materially increased the annual level of compensation of any executive employee of AZQT;

 

 

 

 

Page 9 of 19

 

 

(g)           increased, terminated, amended or otherwise modified any plan for the benefit ofemployees of AZQT;

 

(h)           issued any equity securities or rights to acquire such equity securities; or

 

(i)           except in the ordinary course of business, entered into or modified any contract, agreement or transaction.

 

2.17         Capitalization. The authorized capital stock of AZQT consists of 1,000,000 shares of AZQT Common Stock, $.01 per share par value, of which (a) 1,000,000shares of AZQT Common Stock. AZQT has not granted, issued or agreed
to grant, issue or make any warrants, options, subscription rights or any other commitments of any character relating to the issued or unissued shares of capital stock of AZQT, (b) and 100,000 common shares are issued and outstanding as of August 7, 2009.

 

2.18          Full Disclosure. No representation or warranty by AZQT in this Agreement or in any document or schedule to be delivered by them pursuant hereto, and no written Statement, certificate or instrument furnished or
to be furnished by AZQT pursuant hereto or in connection with the negotiation, execution or performance of this Agreement contains or will contain any untrue Statement of a material fact or omits or will omit to State any fact necessary to make any Statement herein or therein not materially misleading or necessary to a complete and correct presentation of all material aspects of the business of AZQT.

 

SECTION 3. REPRESENTATIONS AND WARRANTIES OF CRC

 

CRC hereby represents and warrants as to itself and CRC as follows:

 

3.1           Organization and Good Standing. CRC is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada. CRC is a corporation duly organized and validly existing under
the laws of the State of Nevada. Each has the corporate power to own its own property and to carry on its business as now being conducted and is duly qualified to do business in any jurisdiction where so required except where the failure to so qualify would have no material negative impact.

 

3.2           Corporate Authority. Each has the corporate power to enter into this Agreement and to perform their respective obligations hereunder. The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by the Board of Directors of CRC as required by Delaware law and the directors and shareholders of CRC as required by Delaware law. The execution and performance of this Agreement will not constitute a material breach of any agreement, indenture, mortgage, license or other instrument or document to which CRC is a party and will not violate any judgment, decree, order, writ, rule, statute, or regulation applicable to CRC or its properties. The execution
and performance of this Agreement will not violate or conflict with any provision of the respective Articles of Incorporation or Bylaws of CRC or CRC.

 

3.3           Capitalization: Purchase of CRC Shares by AZQT Security Holders: Initial Financing
and Merger Shares.

 

 

 

Page 10 of 19

 

 

(a)           As of the date of this Agreement, CRC is authorized to issue 450,000,000shares of CRC Common Stock, $.001 par value per share, and 50,000,000 shares of CRC Preferred Stock, $.001 par value per share, of which approximately (i) 14,000,000 shares of CRC Common Stock
and (ii) no shares of CRC Preferred Stock are issued and outstanding.

 

(b)           Immediately prior to the Effective Time of the Merger, AZQT shall provide to CRC completed and executed copies of the Investor Questionnaire and the Stock Subscription Agreement.

 

(c)           There are no outstanding warrants, issued stock options, stock rights or other

commitments of any character relating to the issued or unissued shares of either Common Stock or Preferred Stock of CRC, other than those which are set forth in Section 3.3(e) below.

 

(d)           At the Closing, the Merger Shares to be issued and delivered to the AZQT Security Holders hereunder will when so issued and delivered, constitute valid and legally issued shares of CRC Common Stock, fully paid and non-assessable. The Merger Shares issuable to such
AZQT Security Holders shall represent approximately7% of the CRC Fully-Diluted Common Stock as at the Effective Time of the Merger.

 

3.4            Compliance with Laws. CRC and CRC has complied with all federal, State, county and local laws, ordinances, regulations, inspections, orders, judgments, injunctions, awards or decrees applicable
to it or its business, which, if not complied with, would materially and adversely affect the business of CRC or CRC or the trading market for the CRC or CRC Shares and specifically, and CRC and CRC has complied with provisions for registration under the Securities Act of 1933 and all applicable blue sky laws in connection with its public stock offering and there are no outstanding, pending or threatened stop orders or other actions or investigations relating thereto.

3.5           Actions and Proceedings. CRC is not a party to any material pending litigation or, to its knowledge, any governmental proceedings that are threatened
against CRC, except as set forth on Schedule 3.5 attached hereto and made a part hereof.

 

3.6           Access to Records. The corporate financial records, minute books, and other documents and records of CRC have
been made available to AZQT prior to the Closing hereof.

 

3.7           No Breach. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated
hereby will not:

 

(a)           violate any provision of the Articles of Incorporation or Bylaws of CRC;

 

(b)           violate, conflict with or result in the breach of any of the terms of, result in a material modification of, otherwise give any other contracting party the right to terminate, or constitute (or with notice or lapse of time or both constitute) a default under, any
contract or other agreement to which CRC is a party or by or to which it or any of its assets or properties may be bound or subject;

 

(c)           violate any order, judgment, injunction, award or decree of any court, arbitrator or governmental or regulatory body against, or binding upon, CRC or
upon the securities, properties or business to CRC; or

 

 

 

Page 11 of 19

 

 

(d)           violate any statute, law or regulation of any jurisdiction applicable to the transactions contemplated herein.

 

3.8           Brokers or Finders. No broker's or finder's fee will be payable by CRC in
connection with the transactions contemplated by this Agreement, nor will any such fee be incurred as a result of any actions of CRC.

 

3.9           Authority to Execute and Perform Agreements. CRC has the full legal right and power and all authority and approval required to enter into, execute and
deliver this Agreement and to perform fully its obligations hereunder. This Agreement has been duly executed and delivered and is the valid and binding obligation of CRC enforceable in accordance with its Terms, except as may be limited by bankruptcy, moratorium, insolvency or other similar laws generally affecting the enforcement of creditors' rights. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby
and the performance by CRC of this Agreement, in accordance with its respective Terms and conditions will not:

 

(a)           require the approval or consent of any governmental or regulatory body or the approval or consent of any other person;

 

(b)           conflict with or result in any breach or violation of any of the Terms and conditions of, or constitute (or with any notice or lapse of time or both would constitute)
a default under, any order, judgment or decree applicable to CRC, or any instrument, contract or other agreement to which CRC is a party or by or to which CRC is bound or subject; or

 

 (c)           result in the creation of any lien or other encumbrance on the assets or properties of CRC.

 

3.10          Full Disclosure. No representation or warranty by CRC in this Agreement or in any document or schedule to be delivered by them pursuant hereto, and no written Statement, certificate or instrument furnished or
to be furnished by CRC pursuant hereto or in connection with the negotiation, execution or performance of this Agreement contains or will contain any untrue Statement of a material fact or omits or will omit to State any fact necessary to make any Statement herein or therein not materially misleading or necessary to complete and correct presentation of all material aspects of the business of CRC.

 

SECTION 4. CONDITIONS PRECEDENT

 

4.1           Conditions Precedent to the Obligation of AZQT. All obligations of AZQT and the AZQT Security Holders under this Agreement are subject to the fulfillment, prior to or as of the Closing Date, as indicated
below, of each of the following conditions (anyone of which may be waived at Closing by AZQT):

 

(a)           The representations and warranties by or on behalf of CRC contained in this Agreement or in any certificate or document delivered pursuant to the provisions hereof shall be true in
all material respects at and as of Closing Date as though such representations and warranties were made at and as of such time.

 

 

Page 12 of 19

 

 

 

(b)           CRC shall have performed and complied in all material respects, with all covenants, agreements, and conditions set forth in, and shall have executed and delivered all documents required
by this Agreement to be performed or complied with or executed and delivered by them prior to or at the Closing.

 

(c)           On the Closing Date, an executive officer of CRC shall have delivered to AZQT a certificate, duly executed by such Person and certifying, that to the best of such Person's knowledge and belief, the representations and warranties of CRC set forth in this Agreement
are true and correct in all material respects.

 

(d)           On or before the Closing, the Board of Directors and the shareholders of CRC and CRC shall have approved, in accordance with applicable law, the execution, delivery and performance of this Agreement and the consummation of the transaction contemplated herein and
authorized all of the necessary and proper action to enable CRC to comply with the Terms of the Agreement

 

(e)           The Merger shall be permitted by applicable law and CRC shall have sufficient shares of CRC Common Stock authorized to complete the Merger.

 

(f)           At the Closing, all instruments and documents delivered to AZQT and the Shareholders pursuant to
provisions hereof shall be reasonably satisfactory to legal counsel for AZQT.

 

(g)           The Merger Shares to be issued to the Shareholders of AZQT at Closing will be validly issued, non-assessable and fully paid under the NRS and will be issued in a non-public offering and exempt merger transaction in Compliance with all federal and State securities
laws, bearing a restrictive legend, as is more fully set forth herein.

4.2           Conditions Precedent to the Obligations of CRC. All obligations of CRC under this Agreement are subject to the fulfillment, prior to or at Closing, of each of the following conditions (anyone of which may
be waived at Closing by CRC):

 

(a)           The representations and warranties by AZQT contained in this Agreement or in any certificate or document delivered pursuant to the provisions hereof shall be true in all material respects at and as of the Closing as though such representations and warranties were
made at and as of such time;

 

(b)            AZQT and the AZQT Security Holders shall have performed and complied with, in all material respects, with all covenants, agreements, and conditions set forth in, and shall have executed and delivered all documents required by this Agreement to be performed
or complied or executed and delivered by them prior to or at the Closing;

 

(c)           On the Closing Date, one of the AZQT Principal Executive Officers shall have delivered to CRC a certificate, duly executed by such Person and certifying, that to the best of such Person's knowledge and belief, the representations and warranties of AZQT set forth
in this Agreement are true and correct in all material respects.

 

 

Page 13 of 19

 

 

(d)           The holders of a majority of the issued and outstanding shares of AZQT Common Stock shall have approved, ratified and confirmed this Agreement, the Merger and all of the transactions contemplated hereby, all in accordance with applicable Nevada law.

 

SECTION 5. COVENANTS

 

5.1           Corporate Examinations and Investigations. Prior to the Closing Date, the parties acknowledge that they have been entitled, through their employees and representatives, to make such investigation of the assets,
properties, business and operations, books, records and financial condition of the other as they each may reasonably require. No investigations, by a party hereto shall, however, diminish or waive any of the representations, warranties, covenants or agreements of the party under this Agreement.

 

5.2           Further Assurances. The parties shall execute such documents and other papers and take such further actions as may be reasonably required or desirable to carry out the provisions hereof and the transactions
contemplated hereby. Each such party shall use its best efforts to fulfill or obtain the fulfillment of the conditions to the Closing, including, without limitation, the execution and delivery of any documents or other papers, the execution and delivery of which are necessary or appropriate to the Closing.

 

5.3           Confidentiality. In the event the transactions contemplated by this Agreement are not consummated, CRC, and AZQT and the respective parties Principal Executive Officers agree to keep confidential any information
disclosed to each other in connection therewith for a period of three (3) years from the Date hereof; provided, however, such obligation shall not apply to information which:

 

(i)           at the time of the disclosure was public knowledge;

 

(ii)           is required to be disclosed publicly pursuant to any applicable Federal or State securities laws;

 

(iii)           after the time of disclosure becomes public knowledge (except due to the action of the receiving party);

 

(iv)           the receiving party had within its possession at the time of disclosure; or

 

(v)           is ordered disclosed by a Court of proper jurisdiction.

 

5.4            Stock Certificates. Within thirty (30) days of the Closing or a time frame as determined by SEC regulatory requirements for filings etc., the CRC Security Holders shall have delivered the certificates
representing the CRC Securities duly endorsed (or with executed stock powers) so as to make AZQT the sole owner thereof. Further, within thirty (30) days of such Closing, CRC shall issue to the AZQT Security Holders the Merger Shares.

 

5.5           Filing of Certificate of Merger. The Articles of Merger shall have been filed in the office of the Secretary of State
for the State of Nevada.

 

 

 

Page 14 of 19

 

 

5.6           Board of Directors. A list of the initial board of directors of AZQT subsequent to the Merger shall be provided by AZQT prior to the Closing. Such initial members of the board of directors shall serve until
the earlier of their death, resignation or removal or until the next annual meeting of the stockholders of AZQT, when their respective successors are duly appointed and qualified. The officers of AZQT subsequent to the Merger shall be the current officers of AZQT.

 

5.7            Indemnification of Officers and Directors. It is the intention of the Parties that CRC and AZQT shall indemnify its officers and directors to the fullest extent permitted by law, as applicable.
In such connection, the Parties agree not to amend the Certificates of incorporation or Bylaws of either CRC or AZQT if such amendment shall have the effect of reducing, terminating or otherwise adversely affecting the indemnification rights and privileges applicable to officers and directors of each of CRC and AZQT, as the same are in effect Immediately prior to the Effective Time of the Merger.

SECTION 6. SURVIVAL OF REPRESENTATIONS AND WARRANTIES

Notwithstanding any right of either party to investigate the affairs of the other party and its Shareholders, each party has the right to rely fully upon representations, warranties, covenants and agreements of the other party and its Shareholders contained in this Agreement or in any document delivered to one by the other or any of
their representatives, in connection with the transactions contemplated by this Agreement. All such representations, warranties, covenants and agreements shall survive the execution and delivery hereof and the closing hereunder for three (3) years following the Closing.

 

SECTION 7. DOCUMENTS AT CLOSING AND THE CLOSING

 

7.1           Documents at Closing At the Closing, the following transactions shall occur, all of such transactions being deemed to
occur simultaneously:

 

(a)           AZQT will deliver, or will cause to be delivered, to CRC the following:

 

(i)             a certificate executed by the President and Secretary of AZQT to the effect that all representations and warranties made by AZQT under this Agreement are true and correct as of the Closing, the same as though originally given to CRC on said Date;

 

(ii)            a certificate from the State of Arizona Dated at or about the Closing to the effect that AZQT is validly existing under the laws of said State;

 

(iii)           stock certificates representing those shares of AZQT to be exchanged for theMerger Shares.

 

(iv)           all other items, the delivery of which is a condition precedent to the obligations of CRC, as set forth in Section 4.

 

(b)           CRC will deliver or cause to be delivered to AZQT and the AZQT Security Holders:

 

 

 

Page 15 of 19

 

 

(i)            a certificate from CRC executed by the President or Secretary of CRC, to the effect that all representations and warranties of CRC made under this Agreement are true and correct as of the Closing, the same as though originally given to AZQT on said Date;

 

(ii)            certified copies of resolutions by CRC Board of Directors authorizing this transaction;

 

(iii)           certificates from the Nevada Secretary of State Dated at or about the Closing Date that CRC are in good standing under the laws of said State; and

(iv)           all other items, the delivery of which is a condition precedent to the obligations of AZQT, as set forth in Section 4 hereof.

 

SECTION 8. MISCELLANEOUS

 

8.1           Waivers. The waiver of a breach of this Agreement or the failure of any party hereto to exercise any right under this Agreement shall in no way constitute waiver as to future breach whether similar or dissimilar
in nature or as to the exercise of any further right under this Agreement.

 

8.2           Amendment. This Agreement may be amended or modified only by an instrument of equal formality signed by the parties
or the duly authorized representatives of the respective parties.

 

8.3           Assignment. This Agreement is not assignable except by operation of law.

 

8.4           Notice. Until otherwise specified in writing, the mailing addresses and fax numbers of the parties of this Agreement
shall be as follows:

 

To: CRC:

 

To: AZQT AND THE AZQT PRINCIPAL EXECUTIVE OFFICERS:

 

Any notice or Statement given under this Agreement shall be deemed to have been given if sent by registered mail addressed to the other party at the address indicated above or at such other address which shall have been furnished in writing to the addressor.

 

8.5           Governing Law. This Agreement shall be construed, and the legal relations between the parties determined, in accordance with the laws of the State of Nevada, thereby precluding any choice
of law rules which may direct the application of the laws of any other jurisdiction.

 

8.6           Arbitration. The parties hereby agree that any dispute or cause of action arising under this Agreement shall be settled by arbitration conducted by one arbitrator. The arbitrator shall be acceptable to both
AZQT and CRC. If an arbitrator cannot be agreed upon as provided in the preceding sentence, an arbitrator will be appointed. The arbitrator shall set a limited time period and establish procedures designed to reduce the cost and time for discovery while allowing the parties an opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from the opposing parties about the subject matter of the dispute The arbitrator shall rule
upon motions to compel or limit discovery and shall have the authority to impose sanctions, including attorneys' fees and costs, to the same extent as a court of competent law or equity, should the arbitrator determine that discovery was sought without substantial justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator shall be written, shall be in accordance with applicable law and with this Agreement, and shall be supported by written findings
of fact and conclusion of law which shall set forth the basis for the decision of the arbitrator. Any such arbitration shall be held exclusively in Phoenix, Arizona.

 

 

 

Page 16 of 19

 

 

8.7            Publicity. No publicity release or announcement concerning this Agreement or the transactions contemplated hereby shall be issued by either party hereto at any time from the signing hereof without advance
approval in writing of the form and substance by the other party.

 

8.8            Entire Agreement. This Agreement (including the Exhibits and Schedules to be attached hereto) and the collateral agreements executed in connection with the consummation of the transactions contemplated
herein contain the entire agreement among the parties with respect to the transactions contemplated hereby, and supersedes all prior agreements, written or oral, with respect hereof.

 

8.9            Headings. The headings in this Agreement are for reference purposes only and shall not in

any way affect the meaning or interpretation of this Agreement.

 

8.10          Severability of Provisions. The invalidity or unenforceability of any term, phrase, clause, paragraph, restriction, covenant, agreement or provision of this Agreement shall in no way affect the validity or enforcement
of any other provision or any part thereof.

 

8.11          Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed, shall constitute an original copy hereof, but all of which together shall consider but one and the same
document.

 

8.12          Binding Effect. This Agreement shall be binding upon the parties hereto and inure to the benefit of the parties, their respective heirs, administrators, executors,

successors and assigns.

8.13          Press Releases. The parties will mutually agree as to the wording and timing of any informational releases concerning this transaction prior to and through Closing.

SIGNATURE PAGE FOLLOWS

 

 

 

 

 

Page 17 of 19

 

IN WITNESS WHEREOF, the parties have executed this agreement on the Date first above written.

CRC CRYSTAL RESEARCH CORPORATION

By:   Kiril Pandelisev    August 7, 2009

Name: Dr. Kiril Pandelisev

Its: Chief Executive Officer

ARIZONA QUARTZ TECH, INC.

By:    Daniel Gura        August 7, 2009

Name: Daniel Gura

Its: President

 

ARIZONA QUARTZ TECH, INC.

By:    Doug Hermanson    August 7, 2009

Name: Doug Hermanson

Its: Vice-President

 

 

Page 18 of 19

 

 

SCHEDULE A

	
Entity
	
 Description
	
 Amount Owed
	
 Preferred Stock
	
 Un-Restricted Common Stock or Cash
	
 Restricted Common Stock

	
Arizona Quartz 

Tech Inc.
	
Daniel J. Gura,

Certificate No.2

 
	  	  	  	
49,250

	
Arizona Quartz 

Tech Inc.
	
Doug Hermanson. 

Certificate No.1
	  	  	  	
49,250

	
Arizona Quartz 

Tech Inc.
	
Klaus Sivec

Certificate No.3
	  	  	  	
15,000

	
  

 
	  	  	  	  	  
	
  

 
	  	
TOTALS
	  	  	
100,000

 

 

 

 

 

 

 

 

 

 

 

 

Page 19 of 19

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