Document:

Prepared by MerrillDirect

EXHIBIT
10(e) – SUPPLEMENTAL RETIREMENT PLAN

 

BEMIS
COMPANY, INC.

SUPPLEMENTAL RETIREMENT PLAN

(As Amended And Restated as of December 31, 1999)

Article
I

General

          Sec.  1.1  Name
of Plan.  The name of the plan set
forth herein is “Bemis Company, Inc. Supplemental Retirement Plan.”  It is sometimes referred to herein as the
“Plan”.

          Sec. 1.2  Purpose.  The Plan has been established for the following purposes:

(a)      To provide the additional benefits which
would have been provided under the regular benefit formula in Sec. 4.5(a) and
(b) of the Bemis Retirement Plan (the “Retirement Plan”) but for the
limitations imposed by §
 415 of the Internal Revenue Code (the “Code”)
and/or Retirement Plan Sec. 8.12 or any successor to either of said
sections.  By providing such benefits,
the Plan is an “excess benefit plan” under §  3
(36) of the Employee Retirement Income Security Act of 1974 (“ERISA”).

(b)      To provide benefits which would have been
payable under the Retirement Plan but for the annual limit on covered compensation
imposed by Code §
 401 (a) (17).  Said limit is $160,000 for 1999 and is subject to a cost of
living adjustment for future years. By providing such benefits, the Plan
provides deferred compensation for a select group of management or highly
compensated employees and therefore is exempt from most requirements of ERISA.

          Sec. 1.3  Definitions.  Unless otherwise specified herein,
capitalized terms used herein shall have the meanings specified in the
Retirement Plan as amended from time to time. 
Terms defined in this Plan include:

(a)      “Actuarial Equivalent” is defined in Sec.
2.2(b)(4).

(b)      “Change in Control” is defined in Sec.
4.2.

(c)      “Committee” is defined in Sec. 3.1.

(d)      “Incumbent Directors” is defined in Sec.
4.3.

(e)      “Plan” is defined in Sec. 1.1.

(f)       “Retirement Plan” is defined in Sec.
1.2(a).

(g)      “Supplemental Pension”, “Target Benefit”,
and “Actual Benefit” are defined in Sec. 2.2(a).

          Sec. 1.4  Participating Employers.  Each employer which is a Participating
Employer under the Retirement Plan is also a Participating Employer under this
Plan.  Morgan Adhesives Company
(“Morgan”) previously sponsored a separate Supplemental Retirement Plan and was
not a Participating Employer under this Plan, but effective as of January 1,
1997, Morgan’s plan is combined with this Plan, and Morgan is a Participating
Employer.

Article
II

Benefits

          Sec. 2.1  Eligibility to Receive a Benefit.  If a person’s Termination of Employment
occurs under circumstances that a benefit is payable under the Retirement Plan
to him or his surviving spouse, contingent annuitant, or beneficiary, a benefit
shall also be payable under this Plan if the benefit under the Retirement Plan
is limited for one or more of the reasons listed in Sec. 1.2.  Each employee or former employee eligible to
receive a benefit under the Plan is a “Participant” in this Plan.

          Sec. 2.2  Amount Payable.  The benefit payable with respect to a
Participant shall be determined and paid as follows:

(a)      The “Supplemental Pension” payable under
this Plan is a monthly pension for each month a pension is payable to the
Participant or to his or her surviving spouse, contingent annuitant, or
beneficiary under the Retirement Plan in a monthly amount equal to the amount,
if any, by which the “Target Benefit” in (1) exceeds the “Actual Benefit” in
(2):

(1)      The “Target Benefit” is the monthly
amount which would have been payable to the Participant under the regular
benefit formula in Sec. 4.5(a) or (b) of the Retirement Plan or to his or her
surviving spouse, contingent annuitant, or beneficiary under the Retirement
Plan for that month if the limits referred to in Sec. 1.2 were not applicable.
The Target Benefit shall be calculated under the form of payment under which
benefits are being paid by the Retirement Plan.  For purposes of determining the Target Benefit, the special
benefit formula in Sec. 4.5(d) of the Retirement Plan shall be disregarded.

(2)      The “Actual Benefit” is the monthly
amount actually payable under the Retirement Plan to the Participant or
surviving spouse, contingent annuitant or beneficiary for that month under the
form of payment under which benefits are paid. 
The Actual Benefit will be determined under Sec. 4.5(a), (b) or (d) of
the Retirement Plan, whichever produces the highest actual benefit.

The
Supplemental Pension shall be paid to the Participant during his or her
lifetime. Following the Participant’s death, the Supplemental Pension will be
paid to the same individuals and in the same proportions as death benefits are
being paid under the Retirement Plan. 
However, no Supplemental Pension will be paid to a Participant for any
month beginning prior to his or her Termination of Employment.  Even if the Retirement Plan pays benefits to
an active employee following his or her attainment of age 70 1⁄2, benefits under
this Plan will not begin until the month after the Participant’s Termination of
Employment.

(b)      However, in lieu of the benefits payable
under subsection (a), a Participant may elect to receive a lump sum payment in
an amount equal to the Actuarial Equivalent of said monthly benefits, subject
to the following:

(1)      Any election by a Participant to receive
a lump sum payment in lieu of monthly benefits must be made not less than 12
months before the Participant’s Termination of Employment. Such elections are
irrevocable.  However, if a Participant
elects a lump sum and then terminates employment within 12 months of making the
election, the election is invalid, and benefits will be paid monthly as provided
in subsection (a).  The following transition
election requirements apply in cases where Participant’s Termination of
Employment occurs on or before June 30, 1998:

(A)     If a Participant’s Termination of
Employment occurs during 1997, the 12-month advance election requirement is not
applicable, and the lump sum will be paid if the Participant elected that form
of payment not later than December 16, 1996.

(B)     If a Participant’s Termination of
Employment occurs during the period January 1, 1998 through June 30, 1998, the
12-month advance election requirement is not applicable, and the lump sum will
be paid if the Participant elected that form of payment not later than June 30,
1997.

(2)      Such elections are not subject to the
consent of the Participant’s spouse.

(3)      If a lump sum is payable, it will be paid
promptly after the amount thereof can be determined. If the amount is dependent
on the Participant’s annual bonus for his or her final year of employment, the
lump sum will not be paid until after the bonus has been computed.

(4)      The “Actuarial Equivalent” factors used
in calculating the lump sum amount are as follows:

(A)     Interest shall be the average of the
interest rate assumptions used in the Pension Benefit Guaranty Corporation
immediate annuity factors for the last three Octobers immediately preceding the
Plan Year in which the lump sum is paid.

 (B)    The
mortality table used for such calculations is the “applicable mortality table”
referred to in Income Tax Reg. 1.417(e)-1T(d)(2), or any successor to said
regulation.

(5)      The lump sum payment is in lieu of all
other benefits payable with respect to the Participant under the Plan,
including death benefits.

(6)      The Committee may, in its sole
discretion, waive the 12-month advance election requirement in subsection (a)
and permit the election to be made closer to a Participant’s Termination of
Employment.  However, such a waiver may
be granted only if the Committee, in its sole discretion, determines that there
are unusual circumstances of hardship which warrant such waiver, including but
not limited to the following:

(A)     Demonstrated financial need;

(B)
    Hardship
arising from illness or medical condition; or

(C)
    Unexpected
termination of employment prior to the date the Participant expected to retire,
such as involuntary termination of employment, termination due to sale of a
Company business or subsidiary, or termination due to medical condition or
illness.

Any
decision by the Committee to waive the 12-month advance election requirement
applies only to the Participant to whom the waiver is granted, and is not
binding or precedential with regard to waivers requested by other Participants.

(c)      If the Participant’s death occurs prior
to the date his monthly pension begins under the Retirement Plan, and
preretirement death benefits are payable under the Retirement Plan to his
surviving spouse, contingent annuitant, or beneficiary, the monthly amount of
the Supplemental Pension shall be determined by reference to the benefits
payable to said person rather than by reference to the pension the Participant
would have received had he lived. Said benefit will be paid to the same
individuals and in the same proportions as death benefits are being paid under
the Retirement Plan.  The Committee may,
in its sole discretion, arrange for payment in a lump sum of preretirement
death benefits under this Plan in cases where the monthly benefit would be
small or is likely to be of long duration. 
Any such lump sum will be the Actuarial Equivalent of the monthly
Supplemental Pension, determined as provided in subsection (b)(4).

          

          Sec. 2.3  Individual Agreements. 
Benefits provided by this Plan may be evidenced by individual employment
agreements between the Company and individuals who are or may become eligible
for such benefits.  Benefits provided by
the Plan will be paid to an individual regardless of whether those benefits are
evidenced by an individual employment agreement.  Any such individual agreement may provide for additional benefits
over and above those provided by this Plan.

Article
III

Administrative
and Miscellaneous Provisions

 

          Sec.3.1  Administration of Plan. The Plan
shall be administered in behalf of the Company by the Bemis Employee Benefits
Committee (the “Committee”).  The
Committee has discretionary authority to construe the terms of the Plan and to
make all decisions and interpretations incident thereto. The Committee may from
time to time adopt such rules for the administration of the Plan as it deems
appropriate.  The decision of the
Committee on any matter affecting the Plan or the rights and obligations
arising under the Plan is final and binding upon all persons.

          Sec.3.2  Miscellaneous Provisions.

(a)      No Participant or Beneficiary shall have
any right to assign, pledge, transfer or otherwise hypothecate this Plan or the
payments hereunder, in whole or in part. Benefits under this Plan will not be
subject to execution, attachment, garnishment or similar process.

(b)      This Plan constitutes the Company’s
unconditional promise to pay the amounts which become payable pursuant to the
terms hereof. A Participant’s rights are solely those of an unsecured creditor.
This Plan does not give any Participant or beneficiary a security interest in
any specific assets of the Company.

(c)      The Committee may in its sole discretion
arrange for payment by a subsidiary of the Company of the amounts the Committee
determines are attributable to service with that subsidiary.  Morgan Adhesives Company shall pay any
benefits attributable to service with it.

(d)      This Agreement shall not be construed as
a contract of employment and does not restrict the right of the Company or any
of its subsidiaries to discharge the Participant or the right of the
Participant to terminate employment.

(e)      The provisions of this Agreement shall be
construed and enforced according to the laws of Minnesota to the extent such
laws are not preempted by ERISA.

(f)       This Agreement shall be binding upon and
for the benefit of the successors and assigns of the Company, whether by way of
merger, consolidation, operation of the law, assignment, purchase or other
acquisition of substantially all of the assets or business of the Company, and
any such successor or assign shall absolutely and unconditionally assume all of
the Company’s obligations hereunder.

(g)      In addition to any other applicable
provisions of indemnification, the Company agrees to indemnify and hold
harmless, to the extent permitted by law, each member of the Committee
(collectively referred to herein as “Indemnitee”) against any and all
liabilities, losses, costs or expenses (including legal fees) of whatsoever
kind an nature which may be imposed on, reasonably incurred by or asserted
against such person at any time by reason of such person’s services in
connection with the Plan, but only if such person did not act dishonestly or in
bad faith or in willful violation of the law or regulations under which such
liability, loss, cost or expense arises. The Company shall have the right, but
not the obligation, to select counsel and control the defense and settlement of
any action against the Indemnitee for which the Indemnitee may be entitled to
indemnification  under this provision.

Article IV

Change in Control

          Sec.4.1  Acceleration of Benefits Upon Change In
Control.  If a “Change in Control”
of the Company (as defined in Sec. 4.2) has occurred, or the Committee
determines that a Change in Control is likely to occur within six months of the
date of determination, the following provisions shall be applicable:

(a)      All remaining benefits payable under the
Plan with respect to any Participant who is a former employee of the Company at
the time of said Change in Control or Committee determination will be paid
immediately in a lump sum.  Said payment
will be made to the Participant if he is living on the payment date.  If the Participant is deceased on the payment
date, the payment will be made to the person or persons entitled to death
benefits with respect to the Participant. 
In either case, the lump sum payment will be in an amount which is the
Actuarial Equivalent of the remaining benefits.

(b)      If a Participant is an active employee of
a Participating Employer at the time of said Change in Control or Committee
determination, but has a Termination of Employment not later than 12 months
after the Change in Control, all benefits payable with respect to the Participant
will be paid in a lump sum promptly after his Termination of Employment.  The lump sum will be the Actuarial
Equivalent of said benefits.

(c)      Actuarial Equivalents under (a) and (b)
will be determined as provided in Sec. 2.2(b)(4).

(d)      However, the Committee may, in its sole
discretion, permit Participants eligible for lump sum payments under (a) or (b)
to waive the lump sum payment.  Any
Participant who elects to waive the lump sum payment will receive his or her
remaining benefits in the form of a monthly pension as provided in Sec. 2.2.

          Sec.4.2  Change in Control.  For purposes of Sec. 4.1, a “Change in
Control” of the Company will mean the following:

(a)      The sale, lease, exchange or other
transfer, directly or indirectly, of substantially all of the assets of the
Company (in one transaction or in a series of related transactions) to a person
or entity that is not controlled by the Company;

(b)      the approval by the shareholders of the
Company of any plan or proposal for the liquidation or dissolution of the
Company;

(c)      a merger or consolidation to which the
Company is a party if the shareholders of the Company immediately prior to
effective date of such merger or consolidation have “beneficial ownership”, as
defined in Rule 13d-3 under the Securities Exchange Act of 1934 (the “Exchange
Act”), immediately following the effective date of such merger or
consolidation, of securities of the surviving corporation representing (i) more
than 50%, but not more than 80%, of the combined voting power of the surviving
corporation’s then outstanding securities ordinarily having the right to vote
at elections of directors, unless such merger or consolidation has been
approved in advance by the Incumbent Directors (a defined in Sec. 4.3 below),
or (ii) 50% or less of the combined voting power of the surviving corporation’s
then outstanding securities ordinarily having the right to vote at elections of
directors (regardless of any approval by the Incumbent Directors);

(d)      any person becomes, after the effective
date of the Plan, the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of (A) 20% or more, but not 50% or more,
of the combined voting power of the Company’s outstanding securities ordinarily
having the right to vote at elections of directors, unless the transaction
resulting in such ownership has been approved in advance by the Incumbent
Directors, or (B) 50% or more of the combined voting power of the Company’s
outstanding securities ordinarily having the right to vote at elections of
directors (regardless of any approval by the Incumbent Directors);

(e)      the Incumbent Directors cease, for any
reason, to constitute at least a majority of the Board; or

(f)       a Change in Control of the Company of a
nature that would be required to be reported pursuant to Section 13 or 15(d) of
the Exchange Act, whether or not the Company is then subject to such reporting
requirements.

          Sec.4.3  Incumbent Directors.  For purposes of Sec. 4.2, “Incumbent
Directors” of the Company will mean any individuals who are members of the
Board on the effective date of the Plan and any individual who subsequently
becomes a member of the Board whose election, or nomination for election by the
Company’s shareholders, was approved by a vote of at least a majority of the
directors comprising the Board on the effective date of the Plan (either by
specific vote or by approval of the Company’s proxy statement in which such
individual is named as a nominee for director without objection to such
nomination).

Article
V

Amendment
or Termination

          Sec.5.1  Amendment.  The Company, by action of the Board, may amend the Plan from time
to time.  The Board may delegate
authority to amend the Plan to the Committee.

          Sec.5.2  Termination.  The Company, by action of the Board, may
terminate the Plan.

          Sec.5.3  Preservation of Benefits.  Notwithstanding any provisions of Sec. 5.1
or Sec. 5.2 to the contrary, no amendment or termination of the Plan under said
sections shall have the effect of reducing a Participant’s aggregate benefit
under this Plan and the Retirement Plan to less than the amount which would
have been payable if the amendment or termination had not occurred, said amount
to be based solely on compensation and service prior to the effective date of
the amendment or termination.Stock Purchase Agreement
                                   Made as of
                                 March 15, 2000,
                                     Between

                            Elite Technologies, Inc.,
                                     Buyer,

                                       and

                          Ace Manufacturing Group, Ltd.
                        S. Randy Ragsdale, Individually,
                                    Seller(s)

<PAGE>

                                Table of Contents

                                                                            Page

1.       DEFINITIONS.                                                         1
--------------------------------------------------------------------------------

         1.1.                                              "APPLICABLE CONTRACT"
         1
         1.2.                                                           "BREACH"
         1
         1.3.                                                            "BUYER"
         1
         1.4.                                                    "BUYER'S STOCK"
         1
         1.5.                                                          "CLOSING"
         1
         1.6.                                                     "CLOSING DATE"
         1
         1.8.                                                          "CONSENT"
         1
         1.9.                                        "CONTEMPLATED TRANSACTIONS"
         2
         1.10.                                                        "CONTRACT"
         2
         1.11.                                                         "DAMAGES"
         2
         1.12.                                             "DISCLOSURE SCHEDULE"
         2
         1.13.                                                     "ENCUMBRANCE"
         2
         1.14.                                      "ENVIRONMENTAL REQUIREMENTS"
         2
         1.15.                                                           "ERISA"
         2
         1.16.                                                      "FACILITIES"
         2
         1.17.                                                            "GAAP"
         3
         1.18.                                      "GOVERNMENTAL AUTHORIZATION"
         3
         1.19.                                               "GOVERNMENTAL BODY"
         3
         1.20.                                                             "IRC"
         3
         1.21.                                                             "IRS"
         3
         1.22.                                                       "KNOWLEDGE"
         3
         1.23.                                               "LEGAL REQUIREMENT"
         3
         1.24.                                                "OPERATING INCOME"
         3
         1.25.                                                           "ORDER"
         4
         1.26.                                     "ORDINARY COURSE OF BUSINESS"
         4
         1.27.                                        "ORGANIZATIONAL DOCUMENTS"
         4
         1.28.                                                          "PERSON"
         4
         1.29.                                                            "PLAN"
         4
         1.30.                                                      "PROCEEDING"
         4
         1.31.                                                  "RELATED PERSON"
         4
         1.32.                                                  "REPRESENTATIVE"
         5
         1.33.                                                  "SECURITIES ACT"
         5
         1.34.                                                          "SELLER"
         5
         1.35.                                                          "SHARES"
         5
         1.36.                                                      "SUBSIDIARY"
         6
         1.37.                                                      "TAX RETURN"
         6
         1.38.                                                      "THREATENED"
         6

2.       TRANSFER OF SHARES; REIMBURSEMENT AMOUNT; CLOSING.                   6
--------------------------------------------------------------------------------

         2.1.                                                            SHARES.
         ----                                                             ------
         6
         2.2.                                                     BUYER'S STOCK.
         ----                                                      -------------
         6
         2.3.                                                           CLOSING.
         ----                                                            -------
         6
         2.4.                                               CLOSING OBLIGATIONS.
         ----                                                -------------------
         6

3.       REPRESENTATIONS AND WARRANTIES OF SELLER.                            7
--------------------------------------------------------------------------------

         3.1.                                    ORGANIZATION AND GOOD STANDING.
         ----                                     ------------------------------
         7
         3.2.                                            AUTHORITY; NO CONFLICT.
         ----                                             ----------------------
         8
         3.3.                                                    CAPITALIZATION.
         ----                                                     --------------
         9
         3.4.                                              FINANCIAL STATEMENTS.
         ----                                               --------------------
         9
         3.5.                                                 BOOKS AND RECORDS.
         ----                                                  -----------------
         9
         3.6.                                 TITLE TO PROPERTIES; ENCUMBRANCES.
         ----                                  ---------------------------------
         10
         3.7.                                        NO UNDISCLOSED LIABILITIES.
         ----                                         --------------------------
         10
         3.8.                                                             TAXES.
         ----                                                              -----
         11
         3.9.                                        NO MATERIAL ADVERSE CHANGE.
         ----                                         --------------------------
         11
         3.10.                                        EMPLOYEE BENEFITS MATTERS.
         -----                                         -------------------------
         11
         3.11.  COMPLIANCE WITH LEGAL REQUIREMENTS; GOVERNMENTAL AUTHORIZATIONS.
                 ---------------------------------------------------------------
         12
         3.12.                                        LEGAL PROCEEDINGS; ORDERS.
         -----                                         -------------------------
         13
         3.13.                            ABSENCE OF CERTAIN CHANGES AND EVENTS.
         -----                             -------------------------------------
         14
         3.14.                                           CONTRACTS; NO DEFAULTS.
         -----                                            ----------------------
         15
         3.15.                                                        INSURANCE.
         -----                                                         ---------
         16
         3.16.                                            ENVIRONMENTAL MATTERS.
         -----                                             ---------------------
         17
         3.17.                                                 EMPLOYEE MATTERS.
         -----                                                  ----------------
         17
         3.18.                      INTELLECTUAL PROPERTY RIGHTS OF THE COMPANY.
         -----                       -------------------------------------------
         17
         3.19.                                                 CERTAIN PAYMENTS.
         -----                                                  ----------------
         19
         3.20.                                                       DISCLOSURE.
         -----                                                        ----------
         20
         3.21.                                               BROKERS OR FINDERS.
         -----                                                ------------------
         20

4.       REPRESENTATIONS AND WARRANTIES OF BUYER.                            20
--------------------------------------------------------------------------------

         4.1.                                    ORGANIZATION AND GOOD STANDING.
         ----                                     ------------------------------
         20
         4.2.                                                         AUTHORITY.
         ----                                                          ---------
         20
         4.3.                                                 INVESTMENT INTENT.
         ----                                                  -----------------
         20
         4.4.                                               CERTAIN PROCEEDINGS.
         ----                                                -------------------
         21
         4.5.                                                BROKERS OR FINDERS.
         ----                                                 ------------------
         21

5.       COVENANTS OF SELLER PRIOR TO CLOSING DATE.                          21
--------------------------------------------------------------------------------

         5.1.                                          ACCESS AND INVESTIGATION.
         ----                                           ------------------------
         21
         5.2.                          OPERATION OF THE BUSINESS OF THE COMPANY.
         ----                           ----------------------------------------
         21
         5.3.                                                 NEGATIVE COVENANT.
         ----                                                  -----------------
         22
         5.4.                                                REQUIRED APPROVALS.
         ----                                                 ------------------
         22
         5.5.                                                      NOTIFICATION.
         ----                                                       ------------
         22
         5.6.                                                    NO NEGOTIATION.
         ----                                                     --------------
         22
         5.7.                                          CLOSING OF BANK ACCOUNTS.
         ----                                           ------------------------
         23

6.       COVENANTS OF BUYER PRIOR TO CLOSING DATE.                           23
--------------------------------------------------------------------------------

         6.1.             APPROVALS OF GOVERNMENTAL BODIES/THIRD PARTY CONSENTS.
         ----              -----------------------------------------------------
         23
         6.2.                                          ACCESS AND INVESTIGATION.
         ----                                           ------------------------
         23
         6.3.                          OPERATION OF THE BUSINESS OF THE COMPANY.
         ----                           ----------------------------------------
         23
         6.4.                                                      NOTIFICATION.
         ----                                                       ------------
         24

7.       CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE.                24
--------------------------------------------------------------------------------

         7.1.                                       ACCURACY OF REPRESENTATIONS.
         ----                                        ---------------------------
         24
         7.2.                                              SELLER'S PERFORMANCE.
         ----                                               --------------------
         24
         7.3.                                                          CONSENTS.
         ----                                                           --------
         24
         7.4.                                              ADDITIONAL DOCUMENTS.
         ----                                               --------------------
         24
         7.5.                                                    NO PROCEEDINGS.
         ----                                                     --------------
         25
         7.6.               NO CLAIM REGARDING STOCK OWNERSHIP OR SALE PROCEEDS.
         ----                ---------------------------------------------------
         25
         7.7.                                                    NO PROHIBITION.
         ----                                                     --------------
         25
         7.8.                                              EMPLOYMENT AGREEMENT.
         ----                                               --------------------
         25
         7.9.                                 REGISTRATION OF SHARES FOR SELLER.
         ----                                  ---------------------------------
         25

8.       CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE.               25
--------------------------------------------------------------------------------

         8.1.                                       ACCURACY OF REPRESENTATIONS.
         ----                                        ---------------------------
         25
         8.2.                                               BUYER'S PERFORMANCE.
         ----                                                -------------------
         25
         8.3.                                                          CONSENTS.
         ----                                                           --------
         26
         8.4.                                              ADDITIONAL DOCUMENTS.
         ----                                               --------------------
         26
         8.5.                                                     NO INJUNCTION.
         ----                                                      -------------
         26

9.       TERMINATION.                                                        26
--------------------------------------------------------------------------------

         9.1.                                                TERMINATION EVENTS.
         ----                                                 ------------------
         26
         9.2.                                             EFFECT OF TERMINATION.
         ----                                              ---------------------
         27

10.      INDEMNIFICATION; REMEDIES.                                          27
--------------------------------------------------------------------------------

         10.1.                                 AGREEMENT BY SELLER TO INDEMNIFY.
         -----                                  --------------------------------
         27
         10.2.                                 AGREEMENTS BY BUYER TO INDEMNIFY.
         -----                                  --------------------------------
         28
         10.3.                                  MATTERS INVOLVING THIRD PARTIES.
         -----                                   -------------------------------
         29

11.      POST-CLOSING AGREEMENTS.                                            30
--------------------------------------------------------------------------------

         11.1.                                         CONSISTENCY IN REPORTING.
         -----                                          ------------------------
         30

12.      GENERAL PROVISIONS.                                                 30
--------------------------------------------------------------------------------

         12.1.                                                         EXPENSES.
         -----                                                          --------
         30
         12.2.                                             PUBLIC ANNOUNCEMENTS.
         -----                                              --------------------
         30
         12.3.                                                  CONFIDENTIALITY.
         -----                                                   ---------------
         30
         12.4.                                                          NOTICES.
         -----                                                           -------
         31
         12.5.                                 JURISDICTION; SERVICE OF PROCESS.
         -----                                  --------------------------------
         32
         12.6.                                               FURTHER ASSURANCES.
         -----                                                ------------------
         32
         12.7.                                                           WAIVER.
         -----                                                            ------
         32
         12.8.                                ENTIRE AGREEMENT AND MODIFICATION.
         -----                                 ---------------------------------
         32
         12.9.                                              DISCLOSURE SCHEDULE.
         -----                                               -------------------
         33
         12.10.               ASSIGNMENTS, SUCCESSORS AND NO THIRD-PARTY RIGHTS.
         ------                -------------------------------------------------
         33
         12.11.                                                    SEVERABILITY.
         ------                                                     ------------
         33
         12.12.                                  SECTION HEADINGS; CONSTRUCTION.
         ------                                   ------------------------------
         33
         12.13.                                                 TIME OF ESSENCE.
         ------                                                  ---------------
         33
         12.14.                                                   GOVERNING LAW.
         ------                                                    -------------
         33
         12.15.                                                    COUNTERPARTS.
         ------                                                     ------------
         33

<PAGE>

                            Stock Purchase Agreement

         THIS STOCK  PURCHASE  AGREEMENT  ("Agreement")  is made as of March 15,
2000, by Elite  Technologies,  Inc., a Texas  corporation,  ("Buyer"),  and AMG,
LTD.,  a  Georgia   Corporation,   Stephen  Randy  Ragsdale,   individually  and
collectively hereinafter referred to as ("Seller").

                                    RECITALS:

         Seller desire to sell, and Buyer desires to purchase, all of the issued
and  outstanding  shares (the  "Shares") of capital  stock of Ace  Manufacturing
Group, LTD. for the consideration and on the terms set forth in this Agreement.

                                    AGREEMENT

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

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

          "Applicable Contract" - any Contract (i) under which Seller or Company
has or may  acquire any  rights;  (ii) under which  Seller or Company has or may
become  subject  to any  obligation  or  liability  or (iii) by which  Seller or
Company or any of the assets owned or used by it is or may become bound.

          "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 (i) any  inaccuracy  in or breach  of, or any  failure to perform or comply
with, such representation, warranty, covenant, obligation, or other provision or
(ii) 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.

         "Buyer's Stock" - 500,000 restricted shares of Seller's capital stock.

         "Closing" - as defined in Section 2.4.

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

         1.7      "Company" - Ace Manufacturing Group, Ltd.

         "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 transfer of the Shares by Seller to Buyer;

         B.       The  execution,  delivery,  and  performance  of  the  Closing
Obligations set forth in Section 2.5;

         C.       The  performance  by   Buyer  and  Seller of their  respective
covenants and  obligations  under this Agreement;

         D.       Buyer's acquisition and ownership of  the Shares  and exercise
of control over the Company; and

         E.       The transfer of Buyer's Stock to Seller; and

         F.       Payment by Buyer to Seller of the Reimbursement Amount.

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

         "Damages" - any loss,  liability,  claim,  damages (including,  without
limitation,  incidental and consequential damages), expense (including,  without
limitation,  costs of investigation and defense and reasonable  attorneys' fees)
or diminution of value, whether or not involving a third party.

         "Disclosure  Schedule" - the disclosure schedule delivered by Seller to
Buyer concurrently with the execution and delivery of this Agreement.

         "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.

         "Environmental  Requirements"  - means  federal,  state and local  laws
relating to  pollution  or  protection  of the  environment,  including  laws or
provisions relating to emissions, discharges, releases or threatened releases of
pollutants, contaminants, or hazardous or toxic materials, substances, or wastes
into air,  surface  water,  groundwater,  or land, or otherwise  relating to the
manufacture,   processing,  distribution,  use,  treatment,  storage,  disposal,
transport,  or  handling  of  pollutants,  contaminants  or  hazardous  or toxic
materials, substances, or wastes.

         "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 Seller and any  buildings,  plants,
structures,  or equipment (including motor vehicles) currently or formerly owned
or operated by Seller.

         "GAAP"  -  generally  accepted  United  States  accounting  principles,
applied on a basis  consistent with the basis on which the financial  statements
referred to in Section 3.4. 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.

         "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 given his position with the Company could
be reasonably  expected to  discover or otherwise  become aware 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.

         "Operating  Income" - means the net income of the Company determined in
accordance with GAAP before income taxes and after all other charges except:

         A. Unless otherwise  approved by Buyer, any general and  administrative
expense  (i.e.,   allocation  of  the  Company's  general  corporate   overhead)
attributable  to the Company  and all  subsidiaries  of the Company  that is not
directly  related to the  operation  of the  Company in the  Ordinary  Course of
Business;  provided,  however,  Operating Income shall include  reimbursement by
Seller of expenses at a fair market price mutually agreed to by Buyer and Seller
for expenses  previously  incurred by Seller,  but that have for  administrative
convenience or efficiency reasons been centralized with Buyer; and

         B.  Any amortization of goodwill of the Company and all Subsidiaries of
the Company.

         C. In the event that  certain  expenses  incurred by the Seller are for
the  principal or partial  benefit of the Company or other  subsidiaries  of the
Company, then the parties hereto shall endeavor to track and determine in a fair
and  equitable  manner that  portion of such  expenses  that  should  fairly and
reasonably  be  allocated  to the  Company  or such  other  subsidiaries  of the
Company, and therefore not included in arriving at Operating Income for purposes
of this Agreement.

         "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

         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"  -  (i)  the  Articles  or  Certificate  of
Incorporation  and the  Bylaws of a  corporation;  (ii) any  charter  or similar
document  adopted  or  filed in  connection  with the  creation,  formation,  or
organization of a Person and (iii) 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.

         "Plan" - as defined in Section 3.10.1.

         "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 (1) 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 (1) 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;

         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

         Any Related Person of any individual described in clause B. or C.

         For  purposes of this  definition,  (i) the  "Family" of an  individual
includes (1) the individual; (2) the individual's spouse and former spouses; (3)
any other natural  person who is related to the  individual or the  individual's
spouse  within the second  degree and (4) any other  natural  person who resides
with such  individual  and (2)  "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
[five  percent  (5%)] of the  outstanding  voting  power of a Person  or  equity
securities or other equity  interests  representing at least [five percent (5%)]
of the outstanding equity securities or equity interests in a Person.

         "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.

         "Seller" - as defined in the first paragraph of this Agreement.

         "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  (1) or  more of its
Subsidiaries;  [when used without reference to a particular Person, "Subsidiary"
means a Subsidiary of the Company].

         "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.

         "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),
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.  TRANSFER  OF SHARES;  REIMBURSEMENT  AMOUNT;
CLOSING.

         Shares.  In exchange for the transfer of Buyer's Stock, as set forth in
Section 2.2, and subject to the terms and conditions of this  Agreement,  at the
Closing, Seller will transfer the Shares to Buyer.

         Buyer's  Stock.  In exchange for the transfer of Shares as set forth in
Section 2.1, and subject to the terms and conditions of this  Agreement,  at the
Closing, Buyer shall transfer to Seller the Buyer's Stock.

         Closing.  The  purchase and sale (the  "Closing")  provided for in this
Agreement will take place at the offices of Morris, Manning & Martin, L.L.P., at
1600 Atlanta  Financial  Center,  3343 Peachtree Road,  N.E.,  Atlanta,  Georgia
30326,  at 10:00 a.m.  (local time) on March 31, 2000, or at such other time and
place as the  parties  may agree.  Except as  otherwise  provided in 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.

         Closing Obligations.  At the Closing:
         -------------------

                  A.       Seller will deliver to Buyer:

                           (i)      Certificates.   Certificates    representing
                                     ------------
the Shares, duly endorsed  (or  accompanied by duly  executed stock  powers) for
transfer to Buyer;

                           (ii)     Good Standing Certificate. Seller shall have
                                      --------------------------
delivered to Buyer a certificate  evidencing the good standing of the Company as
of a recent practicable date;

                           (iii)    Certificate.  A certificate substantially in
                                     -----------
the form of Exhibit A  hereto, 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  Schedule that were  delivered by
Seller to Buyer prior to the Closing Date in accordance with Section 5.5.); and

                           (iv)     Mutual Release. Seller shall have  delivered
                                    --------------
to Buyer a  mutual release,  executed  by Seller, substantially  in the  form of
Exhibit B to be attached at closing
-----------------------------------

                           (v)      All    Corporate    records,   organzational
documents,  minutes of Board of Director  and Shareholder meetings and corporate
seal.

                  B.       Buyer will deliver to Seller:

                           (i)      Certificates.    Certificates   representing
                                     ------------
Buyer's Stock,  duly endorsed (or accompanied by duly executed stock powers) for
transfer to Seller, or a Board of Directors  resolution  signifying the order of
the transfer of shares to Seller to be effectuated immediately, withou delay;

                           (ii)     Certificate.  A certificate  in  the form of
                                    -----------
Exhibit C  hereto   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; and

                           (iii)    Mutual  Release.  Buyer shall have delivered
                                       --------------
to Seller a Mutual  Release,  executed  by Buyer,  substantially  in the form of
Exhibit B to be attached at closing.
-----------------------------------
REPRESENTATIONS AND WARRANTIES OF SELLER.

         Seller represents and warrants to Buyer as follows:

         Organization and Good Standing.
         ------------------------------

                  A. Schedule 3.1 of the Disclosure Schedule contains a complete
and accurate list of the Company's  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).

                  The Company is a corporation duly organized, validly existing,
and in good standing under the laws of Georgia,  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.

                  Seller  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  has made  available  to  Buyer  copies of the
Organizational  Documents  of the Company, as currently in effect.

         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 closing  documents set forth in
Section 2.4A  (collectively,  the "Seller's  Closing  Documents"),  the Seller's
Closing Documents will constitute the legal,  valid, and binding  obligations of
Seller, enforceable against Seller in accordance with their respective terms.

                  Seller  has  the  absolute  and  unrestricted   right,  power,
authority,  and capacity to execute and deliver this  Agreement and the Seller's
Closing  Documents and to perform his  obligations  under this Agreement and the
Seller's Closing Documents.

                  B.  Except  as set  forth in  Schedule  3.2 of the  Disclosure
Schedule,  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 (1) any provision of the Organizational  Documents  of the  Company
or (2) any resolution adopted  by the board of directors or the  stockholders of
the 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 Seller or
the Company, or any of the assets owned or used by Seller, 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 Seller or that otherwise relates to
the business of, or any of the assets owned or used by, the Company;

                           (iv)     Cause Buyer or Seller to become  subject to,
or to become liable for the payment of, any Tax;

                           (v)      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

                           (vi)     Result in the imposition or  creation of any
Encumbrance upon or with respect to any of the assets owned or used by Seller.

         Except as set forth in Schedule 3.2 of the Disclosure Schedule,  Seller
nor the  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.

         Capitalization. The authorized equity securities of the Company consist
of 1000 shares of common  stock,  .01 par value per share,  of which 1000 shares
are issued and outstanding and constitute the Shares.

         Seller is 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 the Company are owned
of record and  beneficially by Seller,  free and clear of all  Encumbrances.  No
legend  or  other  reference  to any  purported  Encumbrance  appears  upon  any
certificate representing equity securities of the Company.

         All of the outstanding  equity securities of the 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 the  Company,  including,  but not  limited  to,  stock
options,  warrants,  convertible  securities,  redemption  rights,  registration
rights and the like.

         None of the outstanding  equity  securities or other  securities of the
Company  was  issued in  violation  of the  Securities  Act or any  other  Legal
Requirement.

         Financial Statements. Seller shall deliver to Buyer, at closing date to
         --------------------
be attached as Schedule 3.4:
               ------------

                  A. Unaudited balance sheets of Seller as of August,  1999, and
as of,  together with the related  statements of income,  changes in stockholder
equity and cash flow (collectively,  the "Financial Statements") for the periods
referred to in such financial statements.

                  B. The Financial Statements  were prepared in accordance  with
this Agreement and with GAAP consistently applied.

         The  Financial  Statements  and  notes,  if  any,  fairly  present  the
financial  condition  and the results of  operations,  changes in  stockholders'
equity,  and cash flow of the Company as at the respective  dates of and for the
periods referred to in such Financial  Statements,  all in accordance with GAAP,
subject,  in the case of  interim  Financial  Statements,  to  normal  recurring
year-end  adjustments  (the  effect of which  will not,  individually  or in the
aggregate, be materially adverse) and the absence of notes.

         Books and Records.  The books of account,  minute  books,  stock record
books,  and other records of the Company,  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 Company 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 Company,
and no meeting of any such  stockholders,  Board of Directors,  or committee has
been held for and no  material  action has been taken at any  meeting  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 Seller.

         Title  to  Properties;   Encumbrances.   Seller  owns  (with  good  and
marketable title in the case of real property,  subject only to the Encumbrances
permitted  by this  Section)  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 Seller or reflected as owned in
the books and records of the Company, including all of the properties and assets
reflected in the Closing Date Financial Statements (except for assets held under
capitalized  leases disclosed or not required to be disclosed in Schedule 3.6 of
the  Disclosure  Schedule  which shall be attached to this Agreement as Schedule
3.6 at the closing date.).

         All  material  properties  and assets  reflected  in the  Closing  Date
Financial  Statements 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  Closing
Date  Financial  Statements  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. Liens for current taxes not yet due; and

                  C. 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 the
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 Seller lie wholly within
the boundaries of the real property owned by Seller and do not encroach upon the
property  of, or  otherwise  conflict  with the  property  rights  of, any other
Person.  All property and assets of the the Company  shall be in the  possession
and control of Seller at Closing, including but not limited to, all Facilities.

         No Undisclosed Liabilities.  Except as set forth in Schedule 3.7 of the
Disclosure  Schedule,  Seller has 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 Closing Date Financial Statements and current liabilities incurred in the
Ordinary Course of Business since the respective dates thereof.

         Taxes. Except as set forth on Schedule 3.8 to the Disclosure  Schedule,
Seller has timely filed all tax returns and reports  required to be filed by it,
including, without limitation, all federal, state and local tax returns, and has
paid in full or made adequate provision by the establishment of reserves for all
taxes and other charges which have become due or which are  attributable  to the
conduct of  Seller's  business  prior to Closing.  Seller will  continue to make
adequate  provision for all such taxes and other charges for all periods through
the Closing Date.

         Except as set forth on Schedule 3.8 to the Disclosure Schedule,  Seller
shall have no Knowledge of any tax  deficiency  proposed or  threatened  against
Seller. There are no tax liens upon any property or assets of the Company.

         Except as set forth on Schedule 3.8 to the Disclosure Schedule,  Seller
has made all payments of estimated taxes when due in amounts sufficient to avoid
the imposition of any penalty.

         Except as set forth on Schedule  3.8 to the  Disclosure  Schedule,  all
taxes and other  assessments  and levies  which  Seller was  required  by law to
withhold or to collect have been duly withheld and collected, and have been paid
over to the proper governmental entity.

         Except as set forth in Schedule  3.8 to the  Disclosure  Schedule,  the
federal and state income tax returns and local  returns,  if any, of Seller have
never been  audited by the income tax  authorities,  nor are any such  audits in
process.  Except as set forth in Schedule 3.8, to the Disclosure  Schedule there
are no  outstanding  agreements or waivers  extending the statute of limitations
applicable  to any  federal or state  income tax  returns of the Company for any
period.

         No Material Adverse Change. Since January,  1996 there has not been any
material  adverse  change in the business,  operations,  properties,  prospects,
assets,  or condition of the Company,  and no event has occurred or circumstance
exists that may result in such a material adverse change.

         Employee Benefits Matters.
         -------------------------

                  3.10.1 Schedule 3.10.1 lists all plans,  programs, and similar
agreements,  commitments or arrangements, whether oral or written, maintained by
or on behalf of Seller or any other party that provide  benefits or compensation
to, or for the benefit of, current or former employees of the Company ("Plan" or
"Plans"). Except as set forth on Schedule 3.10.1 to the Disclosure Schedule only
current and former employees of the Company  participate in the Plans. Copies of
all Plans and, to the extent applicable, all related trust agreements, actuarial
reports, and valuations for the most recent year, all summary plan descriptions,
prospectuses,  Annual  Report  Form  5500s or  similar  forms  (and  attachments
thereto) for the most recent year, all Internal  Revenue  Service  determination
letters, and any related documents requested by Buyer, including all amendments,
modifications and supplements thereto,  have been delivered to Buyer, and all of
the same are or will be true, correct and complete.

                  3.10.2   With respect to each Plan to the extent applicable:

                           A. No   litigation   or   administrative   or   other
proceeding is pending or threatened involving such Plan;

                           B. To the  Knowledge  of Seller,  such Plan  has been
administered  and operated in substantial  compliance with, and has been amended
to comply with all applicable laws, rules, and regulations,  including,  without
limitation,  ERISA, the Internal Revenue Code, and the regulations  issued under
ERISA and the Internal Revenue Code;

                           C.Seller and its  predecessors, if any, have made and
as of the Closing Date will have made or accrued, all payments and contributions
required, or reasonably expected to be required, to be made under the provisions
of  such  Plan  or  required  to  be  made  under  applicable  laws,  rules  and
regulations, with respect to any period following, such amounts to be determined
using the ongoing actuarial and funding assumptions of the Plan;

                           D. Such Plan is fully funded  in an amount sufficient
to pay all liabilities accrued (including liabilities and obligations for health
care,  life insurance and other benefits  after  termination of employment)  and
claims incurred to the date hereof;

                           E. On the Closing Date such Plan will be fully funded
in an amount sufficient to pay all liabilities  accrued  (including  liabilities
and  obligations  for health  care,  life  insurance  and other  benefits  after
termination of employment)  and claims incurred to the Closing Date, or adequate
reserves will be set up on the Company's books and records, or paid-up insurance
will be provided, therefor; and

                           F. Such Plan has been administrated and operated only
in the ordinary and usual course and in accordance with its terms, and there has
not been in the year prior hereto any increase in the  liabilities  of such Plan
beyond increases typically experienced by employers similar to the Company.

         Compliance With Legal Requirements; Governmental Authorizations.
         ---------------------------------------------------------------

                  A.      Except as set forth in Schedule 3.11 of the Disclosure
                                                   -------------
Schedule:

                           (i)      The  Company  is,  and  at  all times  since
January,  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;

                           (ii)     No event has occurred or circumstance exists
that (with or without notice or lapse of time) (1) may constitute or result in a
violation by Seller of, or a failure on the part of Seller to comply  with,  any
Legal  Requirement  or (2) may give rise to any obligation on the part of Seller
to undertake,  or to bear all or any portion of the cost of, any remedial action
of any nature; and

                           (iii)    Seller has not received,  at any  time since
January,  1996, any notice or other communication (whether oral or written) from
any  Governmental  Body or any other Person  regarding (1) any actual,  alleged,
possible,  or  potential  violation  of, or  failure to comply  with,  any Legal
equirement or (2) any actual, alleged,  possible, or potential obligation on the
part of Seller to  undertake,  or to bear all or any portion of the cost of, any
remedial action of any nature.

                  B.  Schedule 3.11  Except as set forth in Schedule 3.11 of the
                       -------------                        ------------
 Disclosure Schedule:

                           (i)      The  Company   is,  and  at all times  since
January,  1996,  has  been,  in  full  compliance  with  all  of  the  terms and
requirements of any applicable Governmental Authorization;

                           (ii)     No event has occurred or circumstance exists
that may with or  without  notice  or lapse of time)  (1)  constitute  or result
directly or indirectly in a violation of or a failure to comply with any term or
requirement of any applicable Governmental  Authorization or (2) result directly
or  indirectly  in the  revocation,  withdrawal,  suspension,  cancellation,  or
termination   of,  or  any   modification   to,  any   applicable   Governmental
Authorization;

                           (iii)    Seller has not received,  at any  time since
January,  1996, any notice or other communication (whether oral or written) from
any  Governmental  Body or any other Person  regarding (1) any actual,  alleged,
possible,  or  potential  violation  of or  failure  to comply  with any term or
requirement  of any  Governmental  Authorization  or (2) any  actual,  proposed,
possible,  or  potential  revocation,  withdrawal,   suspension,   cancellation,
termination of, or modification to any Governmental Authorization; and

                           (iv)     All   applications   required  to  have been
filed for the renewal of the Governmental Authorizations 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 Seller has obtained any  Governmental  Authorizations  necessary to
permit the Company to  lawfully  conduct and  operate  their  businesses  in the
manner they  currently  conduct and operate  such  businesses  and to permit the
Company to own and use their  assets in the manner in which they  currently  own
and use such assets.

         Legal Proceedings; Orders.
         -------------------------

                  A. Except as set forth in  Schedule  3.12  of  the  Disclosure
                                              --------------
Schedule, there is no pending Proceeding:

                           (i)      That has been commenced by or against Seller
or that otherwise relates to or may affect the business of, or any of the assets
owned or used by, Seller; 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,  (i) no such Proceeding has been Threatened
and (ii) 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 shall have
delivered to Buyer copies of all pleadings,  correspondence, and other documents
relating to each Proceeding listed in Schedule 3.12 of the Disclosure  Schedule.
The Proceedings listed in Schedule 3.12 of the Disclosure Schedule will not have
a material adverse effect on the business,  operations,  assets,  condition,  or
prospects of the Company.

                  B.  Except as  set  forth in Schedule  3.12 of  the Disclosure
                                                -------------
Schedule:

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

                           (ii)     Seller  is  not subject  to any  Order  that
relates to the  business of, or any of the assets owned or used by, the Company;
and

                           (iii)    No officer,  director, agent, or employee of
the  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 the Company.

                  C.  Except as set  forth in  Schedule  3.12 of the  Disclosure
                                                -------------
Schedule:

                           (i)      Seller is, and at all  times since  January,
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 Seller, or any of the assets owned or used by Seller, is subject; and

                           (iii)    Seller has not received,  at  any time since
January,  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 the  Company,  or any of the assets  owned or
used by the Company, is or has been subject.

         Absence of Certain Changes and Events.  Except as set forth in Schedule
3.13 of the Disclosure Schedule,  since January, 1996, the Company has conducted
its business only in the Ordinary Course of Business and there has not been any:

                  A. Change in the Company's authorized or issued capital stock;
grant of any stock  option or right to purchase  shares of capital  stock of the
Company;  issuance of any security convertible into such capital stock; grant of
any registration rights; purchase, redemption,  retirement, or other acquisition
by the  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 the Company;

                  C. Payment or increase by Seller 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 the Company;

                  E. Damage to or destruction or loss of any asset  or property
of  the  Company,  whether  or  not  covered  by   insurance,   materially   and
adversely affecting the properties,  assets,  business,  financial condition, or
prospects of the Company, taken as a whole;

                  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 the Company of at least Five
Thousand and No/100 Dollars ($5,000.00);

                  G. Sale (other than sales of inventory in the Ordinary  Course
of  Business),  lease,  or other  disposition  of any asset or  property  of the
Company or mortgage,  pledge,  or imposition of any lien or other encumbrance on
any material  asset or property of the Company,  including the sale,  lease,  or
other disposition of any of the Software and Intangibles;

                  H. Cancellation or waiver of any claims or rights with a value
 to the Company in excess of Five Thousand and No/100 Dollars ($5,000.00);

                  I. Material  change  in the  accounting  methods used  by  the
Company; or

                  J. Agreement, whether oral or written, by Seller to do  any of
the foregoing.

         Contracts; No Defaults.
         ----------------------

                  A.  Except as set forth in Schedule  3.17(A) of the Disclosure
                                              ----------------
Schedule:

                           (i)      Other  than as set  forth  or  provided  for
on the Financial  Statements,  the Company has not or may not acquire any rights
under,  and the Company has not or may not become  subject to any  obligation or
liability  under,  any  Contract  under which the Company is  obligated  to make
payments totaling, or services having a value equal to, $5,000 or more ; and

                           (ii)     To  the  Knowledge  of  Seller,  no officer,
director, agent, employee,  consultant, or contractor of the Company is bound by
any  Contract  that  purports  to limit the ability of such  officer,  director,
agent,  employee,  consultant,  or  contractor  to (1) engage in or continue any
conduct,  activity,  or practice  relating to the business of the Company or (2)
assign  to the  Company  or to any other  Person  any  rights to any  invention,
improvement, or discovery.

                  B. Except  as   set  forth  in  Schedule   3.17 (B)   of   the
                                                   -----------------
Disclosure  Schedule,  each material Contract is in full force and effect and is
valid and enforceable in accordance with its terms.

                  C.  Except as set forth in Schedule 3.17(C)  of the Disclosure
                                             ----------------
Schedule:

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

                           (ii)     Each  other  Person  that  has  or  had  any
obligation  or liability  under any Contract  under which the Company has or had
any  rights  is,  and at all  times  since  January,  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 Seller 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)     Seller has not  given to  or  received  from
any  other  Person,  at any  time  since  January,  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.

                  F. There are no renegotiations of, attempts to renegotiate, or
outstanding rights to renegotiate any material amounts paid or payable to Seller
under current or completed Contracts with any Person and no such Person has made
written demand for such renegotiation.

                  G. The Contracts relating to the sale, design, manufacture, or
provision  of products or services by the Company  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.

         Insurance.
         ---------

                  A. Seller have delivered to Buyer:

                           (i)      True and  complete  copies of  all  policies
of  insurance  to which the  Company  or  Seller  is a party or under  which the
Company,  or any  director of the  Company,  is or has been  covered at any time
within the two (2) years preceding the date of this Agreement;

                           (ii)     True  and  complete  copies  of all  pending
applications for policies of insurance; and

                           (iii)    Any   statement  by  the   auditor  of   the
Company's  financial  statements  with regard to the  adequacy of such  entity's
coverage or of the reserves for claims.

                  B. Except as set forth on Schedule  3.15(B)  of the Disclosure
                                              ----------------
Schedule:

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

                                    (1)     Are     valid,    outstanding,   and
enforceable;

                                    (2)     Taken  together  in  the  reasonable
 judgment of Seller,  provide adequate insurance coverage for the assets and the
operations  of the  Company  for all risks to which  the  Company  are  normally
exposed;

                                    (3)     Are sufficient  for compliance  with
all Legal  Requirements and Contracts  to which Seller is a party or by which it
is bound;

                                    (4)     Will  continue  in  full  force  and
effect  following the  consummation  of the Contemplated Transactions; and

                                    (5)     Do not provide for any retrospective
premium  adjustment or  other experienced-based liability on the part of Seller.

                           (ii)     Neither Seller nor the Company has  received
(1) any refusal of coverage or any notice that a defense  will be afforded  with
reservation of rights or (2) 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)    Seller has paid all premiums  due,  and have
otherwise  performed all of their respective  obligations,  under each policy to
which  Seller is a party or that  provides  coverage  to the Company or director
thereof.

                           (iv)     Seller  has given  notice  to the insurer of
all  claims  that may be  insured thereby.

         Environmental  Matters.  Except  as set forth in  Schedule  3.16 of the
Disclosure Schedule,  at all times since January,  1996, Seller has obtained and
is in compliance with all permits, licenses and other authorizations required to
do business by Environmental Requirements.

         Employee Matters.
         ----------------

         Except as set forth on Schedule 3.17, at all times since January, 1996,
Seller has  complied in all  respects  with all Legal  Requirements  relating to
employment, equal employment opportunity, nondiscrimination, immigration, wages,
hours,  benefits,  collective  bargaining,  the payment of social  security  and
similar taxes, occupational safety and health and plant closing.

         Except as set forth on  Schedule  3.17,  Seller is not  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.

         Intellectual Property Rights of the Company.
         -------------------------------------------

                  A.  Definitions.  As used in this  Agreement,  and in addition
                      -----------
to any other terms defined in this Agreement, the following terms shall have the
following meanings.

                           (i)      "Software"  means   any   computer  program,
                                      --------
operating  system,  applications  system,  firmware  or  software of any nature,
whether operational,  under development or inactive,  including all object code,
source code, technical manuals,  compilation  procedures,  execution procedures,
flow charts,  programmers notes, user manuals and other  documentation  thereof,
whether in machine-readable  form, programming language or any other language or
symbols and whether stored, encoded, recorded or written on disk, tape, film,
 memory  device,  paper or other  media of any nature.

                           (ii)     "Owned  Software"  means all Software  owned
                                     ---------------
by the Company,  whether purchased from a third party, developed by or on behalf
of the Company, currently under development or otherwise.

                           (iii)    "Customer   Software"  means  all  Software,
                                        -----------------
other than the Owned Software, that is, directly or through Distributors, either
(x) offered or provided to  customers  of the Company or (y) used by the Company
to provide information or services to customers of the Company for a fee.

                           (iv)     "Seller Software" means  the Owned  Software
                                      ---------------
and the Customer Software.

                           (v)      "Other Software" means  all Software,  other
                                      --------------
than the Company's Software,  that is licensed by the Company from third parties
or otherwise used by the Company for any purpose whatsoever.

                           (vi)     "Intangible" means:
                                     ----------

                                    (1)     Patents, patent applications, patent
disclosures,  all  re-issues, divisions, continuations, renewals, extensions and
continuation-in-parts thereof and improvements thereto;

                                    (2)     Trademarks,   service  marks,  trade
dress,  logos,   trade   names,   and  corporate  names  and  registrations  and
applications for Registration thereof and all goodwill associated therewith;

                                    (3)     Copyrights,   Registrations  thereof
and  applications  for  Registration thereof;

                                    (4)     Maskworks, Registrations thereof and
applications  for  Registration thereof;
                                    (5)     Trade   secrets   and   confidential
business  information  (including  ideas,  formulas,  compositions,  inventions,
whether  patentable  or  unpatentable  and whether or not  reduced to  practice,
know-how,  manufacturing and production  processes and techniques,  research and
development   information,    drawings,   flow   charts,    processes,    ideas,
specifications,  designs, plans, proposals, technical data, copyrightable works,
financial, marketing, and business data, pricing and cost information,  business
and marketing plans, and customer and supplier lists and information);

                                    (6)     Other proprietary rights;

                                    (7)     All income, royalties,  Damages  and
payments  due at  Closing or  thereafter  with  respect  to the Owned  Software,
Customer  Software,  Other Software,  or other  Intangibles and all other rights
thereunder including, without limitation, Damages and payments for past, present
or  future  infringements  or  misappropriations  thereof,  the right to sue and
recover for past, present or future infringements or misappropriations thereof;

                                    (8)     All  rights  to  use   all  of   the
foregoing forever; and

                                    (9)     All other rights in,  to, and  under
the foregoing in all countries.

                  B.       Ownership and Right to License.
                           ------------------------------

                           (i)      Except  as set forth  in  Schedule  3.18  of
                                                              --------------
the  Disclosure  Schedule,  to the  Knowledge of the Seller,  at all times since
January,  1996,  Seller has good and marketable  title to the Owned Software and
Intangibles  attributable to the Owned Software,  and have the full right to use
all of the Customer  Software and Other Software,  and Intangibles  attributable
thereto,  as used or  required  to  operate  Seller's  businesses  as  currently
conducted and as contemplated in the future in accordance with Seller's  written
business  plans,  free and clear of any liens,  claims,  charges or encumbrances
which would affect the use of such Software in connection  with the operation of
Seller's  business as currently  conducted and as  contemplated in the future in
accordance with Seller's written business plans.

                           (ii)     To the  Knowledge of  Seller,  no  rights of
any third party not previously obtained are necessary to market,  license, sell,
modify,  update,  and/or  create  derivative  works for any Software as to which
Seller  take any  such  action  in  their  respective  businesses  as  currently
conducted and as contemplated in the future in accordance with Seller's  written
business plans.

                           (iii)    To the  Knowledge  of  Seller,  none of  the
Software or Intangibles or their  respective  past or current uses by or through
Seller have violated or infringed upon, or is violating or infringing  upon, any
Software,  patent, copyright, trade secret or other Intangible of any Person. To
the knowledge of Seller,  Seller has adequately maintained all trade secrets and
copyrights with respect to such Software.

         To the  Knowledge  of Seller,  Seller  has  performed  all  obligations
imposed upon them with regard to the Customer  Software and Other Software which
are required to be performed by them on or prior to the date hereof,  and Seller
nor, to the  Knowledge of Seller,  any other  party,  is in breach of or default
thereunder  in any  respect,  nor to the  Seller's  Knowledge is there any event
which  with  notice  or  lapse  of time  or  both  would  constitute  a  default
thereunder.

         Certain Payments. Since January, 1996, neither Seller nor any director,
officer,  agent, or employee of the Company, nor to Seller's Knowledge any other
Person  associated  with or acting for or on behalf of Seller,  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 the Copmany or any affiliate
of the 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 Company.

         Disclosure.
         ----------

                  A. No  representation  or warranty of Seller in this Agreement
and no  statement  in the  Disclosure  Schedule  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.  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  Seller  that  has  specific
application  to Seller or the 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 Company (on a consolidated
basis) that has not been set forth in this Agreement or the Disclosure Schedule.

         Brokers or Finders.  Seller and its 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.
REPRESENTATIONS AND WARRANTIES OF BUYER.

         Buyer represents and warrants to Seller as follows:

         Organization and Good Standing.  Buyer is a Texas corporation.
         ------------------------------

         Authority.  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 closing  documents set forth in
Section  2.5.B  (collectively,  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.

         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.

         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.

         Brokers or Finders. Buyer and its 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.

         4.6. Full  Disclosure.  To the best knowledge of Buyer,  it's officers,
directors or agents, no representation,  warranty or covenant of Buyer contained
in this Agreement or in any other written statement or certificate  delivered by
Buyer  pursuant  to  this  Agreement  or in  connection  with  the  transactions
contemplated  herein or in any SEC filing  contains  or will  contain any untrue
statement  of a  material  fact or omits or will omit to state a  material  fact
necessary to make the statements contained herein or therein not misleading.  To
the best  knowledge of Buyer,  it's officers,  directors or agents,  there is no
fact  which  adversely  affects,  or in the  future may  adversely  affect,  the
business,  operations, cash flows, affairs,  prospects,  properties or assets or
the condition,  financial or otherwise of the Buyer which has not been disclosed
in this  Agreement,  or in the documents,  certificates  and written  statements
furnished to Seller for use in  connection  with the  transactions  contemplated
hereby or in any SEC filing.
COVENANTS OF SELLER PRIOR TO CLOSING DATE.

         Access and  Investigation.  Between the date of this  Agreement and the
          -------------------------
Closing Date,  Seller will,  and will cause the 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  the  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.

         Operation  of the  Business  of the  Company.  Between the date of this
Agreement and the Closing Date, Seller will:

                  A. Conduct the  business of  the Company  only in the Ordinary
Course of Business;

                  B. Use its commercially  reasonable efforts to preserve intact
the current business organization of the Company, keep available the services of
the current  officers,  employees,  and agents of the Company,  and maintain the
relations  and  good  will  with  suppliers,  customers,  landlords,  creditors,
employees,  agents, and others having business relationships with the Company or
Seller;

                  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 the Company.

         Negative  Covenant.  Except as  otherwise  expressly  permitted by this
Agreement,  between the date of this Agreement and the Closing Date, Seller will
not without the prior 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 3.13. is likely to occur.

         Required  Approvals.  As promptly as practicable after the date of this
Agreement, Seller will, and will cause the Company to, make all filings required
by Legal Requirements to be made by them in order to consummate the Contemplated
Transactions.  Between the date of this  Agreement and the Closing Date,  Seller
will, and will cause the Company to:

                  A. Cooperate with Buyer with respect to all filings that Buyer
reasonably  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 required Consents.

         Notification.  Between the date of this Agreement and the Closing Date,
Seller will promptly notify Buyer in writing if Seller becomes aware of any fact
or  condition   that  causes  or   constitutes  a  Breach  of  any  of  Seller's
representations  and warranties as of the date of this  Agreement,  or if Seller
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
Schedule if the  Disclosure  Schedule  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  Schedule  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.

         No  Negotiation.  Until  such  time,  if  any,  as  this  Agreement  is
terminated  pursuant  to  Section  9.,  Seller  will  not,  and will  cause  its
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 the Company,  or any of the capital stock of the Company, or any
merger,  consolidation,  business combination,  or similar transaction involving
Seller.

         Closing of Bank Accounts. Seller shall cause the closing of all Company
          -------------------------
bank  accounts  for which  Seller,  or its  officers  and  directors,  have sole
signature authority.

COVENANTS OF BUYER PRIOR TO CLOSING DATE.

         Approvals of Governmental  Bodies/Third Party Consents.  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:

                  A. Cooperate  with  Seller  with  respect to all  filings that
Seller is  required by  Legal  Requirements  to  make  in  connection  with  the
Contemplated Transactions; and

                  B. Cooperate with Seller in obtaining all consents  identified
in Schedule 3.2 of the  Disclosure  Schedule;  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.

         Access and  Investigation.  Between the date of this  Agreement and the
         -------------------------
Closing Date, Buyer will, and will cause its Representatives to:

                  A.  Afford  Seller  and its  Representatives  and  prospective
lenders and their Representatives  (collectively,  "Seller's Advisors") full and
free access to Buyer's personnel,  properties  (including  subsurface  testing),
contracts, books and records, and other documents and data;

                  B. Furnish Seller and  Seller's  Advisors  with  copies of all
such  contracts,  books and  records, and other  existing documents  and data as
Seller may reasonably request; and

                  C. Furnish  Seller and Seller's  Advisors with such additional
financial,  operating,  and  other data and information as Seller may reasonably
request.

         Operation  of the  Business  of the  Company.  Between the date of this
Agreement and the Closing Date, Buyer will:

                  A. Conduct  the  business of Buyer only in the Ordinary Course
of Business;

                  B. Use commercially  reasonable efforts to preserve intact the
current business organization of Buyer; and
A.       Confer with Seller concerning operational matters of a material nature.

         Notification.  Between the date of this Agreement and the Closing Date,
Buyer will promptly  notify Seller in writing if Buyer becomes aware of any fact
or  condition   that  causes  or   constitutes   a  Breach  of  any  of  Buyer's
representations  and  warranties as of the date of this  Agreement,  or if Buyer
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.
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):

         Accuracy of Representations.
         ---------------------------

                  A. All of  Seller'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,  without  giving
effect to any supplement to the Disclosure Schedule.

                  B. Each of Seller's  representations and warranties in Article
3. 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
Schedule.

         Seller's Performance.
         --------------------

                  A.  All  of the  covenants  and  obligations  that  Seller  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  duly  performed  and
complied with in all material respects.

                  B. Each document required to be delivered  pursuant to Section
2.4. must have been delivered  by closing,  and each of the other  covenants and
obligations  in Section 5. must have been  performed  and complied  with  in all
respects.

                  C. The  results  of  any  investigation performed  by Buyer in
connection  with  Section 5.1.  shall be  satisfactory  to  Buyer  in  its  sole
discretion.

         Consents.  Each  of  the  Consents  identified  in Schedule  3.2 of the
         --------                                         -------------
Disclosure  Schedule  must  have  been  obtained  and must be in full  force and
effect.

         Additional  Documents.  Seller shall  deliver  such other  documents as
Buyer may  reasonably  request for the purpose of (i) evidencing the accuracy of
any of Seller's representations and warranties;  (ii) evidencing the performance
by Seller of, or the  compliance  by 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.

         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 (i) involving any challenge to, or seeking Damages or
other relief in connection  with, any of the  Contemplated  Transactions or (ii)
that may have the effect of preventing,  delaying,  making illegal, or otherwise
interfering with any of the Contemplated Transactions.

         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
(i) 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 Seller or (ii) is entitled to all or any portion
of the  Purchase  Price  payable  for the  Shares,  except  as has  been  orally
disclosed to Buyer.

         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,  (i)  any  applicable  Legal
Requirement  or Order  or (ii)  any  Legal  Requirement  or Order  that has been
published, introduced, or otherwise proposed by or before any Governmental Body.

         Employment Agreement. On or before the Closing  Date,  Seller(s)  shall
           ---------------------
have entered  into an  employment agreement with Buyer.

         Registration  of Shares for  Seller.  Buyer  hereby  certifies  that it
intends to file a registration  statement under exception rule SB-2, for a block
of Buyers common stock.  Buyer agrees to allow Seller  "piggyback"  registration
rights  of Buyers  common  stock in an amount  so that  Seller  shall  receive a
benefit of two hundred fifty thousand  dollars  ($250,000.00).  Seller agrees to
sell the registered shares through Buyers Investment Banker only, and only in an
amount of shares (as deemed by the  Investment  Banker of Buyer) as not to cause
any adverse effect on stock price of Buyer.
CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE.

         Seller's  obligation  to sell 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):

         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.

         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 2.5.

         Consents.  Each  of  the  Consents  identified  in Schedule  3.2 of the
          --------                                         -------------
Disclosure  Schedule  must  have  been  obtained  and must be in full  force and
effect.

         Additional Documents. Buyer must have caused the following documents to
be delivered to Seller such other 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.

         No Injunction. There must not be in effect any Legal Requirement or any
injunction or other Order that (i) prohibits the sale of the Shares by Seller to
Buyer and (ii) has been adopted or issued,  or has otherwise  become  effective,
since the date of this Agreement. 8.6.
8.6  Employment  Agreements.  Buyer and Stephen R. Ragsdale  shall enter into an
Employment  Agreement,  in a form to be  mutually  agreed  by the  parties.  8.7
Performance of Buyer's  Stock.  Buyer shall use best efforts,  at all times,  to
maintain  promotion of Buyer's stock in the public market  (AMEX,  NYSE,  Etc.).
Should the stock price of Buyer fall below one dollar ($1.00) for the average of
five business days from the date of the  anniversary of this  Agreement  through
five business days after the date of the anniversary of this Agreement,  and the
price of Buyers stock fail to rise above one dollar  ($1.00),  Seller shall have
one of the following options:

         Seller may terminate  this  Agreement,  and 100% of the stock of Seller
shall be returned. Seller shall return 100% of the stock of Buyer. Provision 9.2
of this Agreement shall immedately take effect.

         B. Seller shall receive an  additional five hundred thousand  (500,000)
shares of common stock of Buyer, with "piggy back" registration rights.
TERMINATION.

         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.   have  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;

                           (ii)     By  Seller,  if  any  of the  conditions  in
Section 7. have 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 has not
waived such condition on or before the Closing Date; or

                  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 March
31, 2000, or such later date as the parties may agree upon.

         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 12.1. and 12.3. 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  (1) 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. INDEMNIFICATION; REMEDIES.

         Agreement  by Seller to  Indemnify.  Seller (the  "Seller  Indemnifying
Party"),  agrees that they will  indemnify and hold Buyer harmless in respect of
the aggregate of all indemnifiable Damages of Buyer.

         For this purpose,  "indemnifiable Damages" of Buyer means the aggregate
of all Damages incurred or suffered by Buyer resulting from:

                  A. Any  inaccurate  representation  or warranty made by Seller
in or  pursuant  to this Agreement;

                  B. Any default in the  performance  of any of the covenants or
agreements  made by Seller in this Agreement; or

                  C. The failure of any Seller to pay,  discharge or perform any
liability or obligation of Seller or of Seller  resulting  from the operation of
Seller's business prior to the Closing Date.

         With respect to the measurement of "Indemnifiable Damages", Buyer shall
have the right to be put in the same  financial  position  as it would have been
had each of the  representations  and warranties of Seller been true and correct
and had each of the covenants of Seller been performed in full.

         The  amount of any  indemnifiable  Damages  otherwise  payable to Buyer
hereunder shall be reduced if the  indemnifiable  Damages incurred by Buyer will
provide Buyer with income tax deductions or credits. The amount of the reduction
shall be the amount of the actual cash tax savings realized by Buyer as a result
of such deductions or credits, discounted to its present value as of the date of
the  payment  of the  indemnifiable  Damages  from the date  such  indemnifiable
Damages were  incurred by Buyer at the rate of interest  charged on such date by
the Internal Revenue Service on underpayment of taxes.

         The  foregoing  obligation  of Seller  Indemnifying  Party to indemnify
Buyer shall be subject to each of the following principles or qualifications:

                  3. Each of the  representations  and warranties made by Seller
in this Agreement or pursuant hereto, shall survive for a period of one (1) year
after the Closing;  provided,  however,  that the representations and warranties
made by Seller to the extent they relate to Seller's  title to the Shares  shall
survive forever and that the  representations  and warranties made by Seller and
Shareholder in Section 3.8.  hereof  ("Taxes")  shall in each case survive until
the first (1st) anniversary of the later of:

                           A. The date on which  applicable period of limitation
on assessment or refund of tax has expired; or

                           B. The date on which the applicable taxable  year (or
 portion  thereof)  has been closed.

         No claim for the recovery of  indemnifiable  Damages may be asserted by
Buyer against Seller  Indemnifying  Party or their  successors in interest after
such  representations  and  warranties  shall  be thus  extinguished;  provided,
however,  that claims first  asserted in writing  within the  applicable  period
shall not thereafter be barred.

         Agreements  by Buyer  to  Indemnify.  Buyer  (the  "Buyer  Indemnifying
Party"),  agrees to indemnify and hold Seller (the "Seller  Indemnified  Party")
harmless  in respect of the  aggregate  of all  indemnifiable  Damages of any of
Seller Indemnified Parties.

         For this purpose,  "indemnifiable Damages" of the of Seller Indemnified
Party  means the  aggregate  of all  Damages  incurred or suffered by the Seller
Indemnified Party resulting from:

                  A. Any inaccurate representation or warranty  made by Buyer or
pursuant to this Agreement; or

                  B. Any default in the  performance  of any of the covenants or
agreements  made by Buyer in this Agreement.

         With respect to the measurement of "Indemnifiable  Damages", the Seller
Indemnified Party shall have the right to be put in the same financial  position
as they would have been had each of the  representations and warranties of Buyer
Indemnifying  Party been true and correct and had each of the covenants of Buyer
Indemnifying Party been performed in full.

         The amount of any indemnifiable Damages otherwise payable to any Seller
Indemnified  Party  hereunder  shall be  reduced  if the  indemnifiable  Damages
incurred by Seller  Indemnified  Party will  provide  such Party with income tax
deductions or credits.  The amount of the  reduction  shall be the amount of the
actual cash tax savings realized by Seller Indemnified Party as a result of such
deductions  or credits  discounted  to its  present  value as of the date of the
payment of the indemnifiable  Damages from the date such  indemnifiable  Damages
were  incurred by Seller  Indemnified  Party at the rate of interest  charged on
such date by the Internal Revenue Service on underpayment of taxes.

         The  foregoing  obligation  of Buyer  Indemnifying  Party to  indemnify
Seller Indemnified Party shall be subject to each of the following principles or
qualifications:

                  10.2.1  Each of the  representations  and  warranties  made by
Buyer in Article 4 of this Agreement  shall survive for a period of one (1) year
after the Closing Date, and thereafter all such  representations  and warranties
shall be extinguished.

         No claim for the recovery of  indemnifiable  Damages pursuant to clause
(i) of Section 10.2. may be asserted by Seller  Indemnified  Party against Buyer
Indemnifying Party or its successors in interest after such  representations and
warranties  shall be thus  extinguished;  provided,  however,  that claims first
asserted in writing within the applicable period shall not thereafter be barred.

         Matters Involving Third Parties.  If any third party shall notify Buyer
or Seller (the  "Indemnified  Party")  with respect to any matter which may give
rise to a claim for  indemnification  against any other Party (the "Indemnifying
Party")  under this Section 10.,  then the  Indemnified  Party shall notify each
Indemnifying  Party thereof promptly;  provided,  however,  that no delay on the
part of the Indemnified Party in notifying any Indemnifying  Party shall relieve
the  Indemnifying  Party from any liability or obligation  hereunder unless (and
then solely to the extent that) the Indemnifying Party thereby is Damaged.

         If any Indemnifying Party notifies the Indemnified Party within fifteen
(15) days after the  Indemnified  Party has given  notice of the matter that the
Indemnifying Party is assuming the defense thereof, then:

                  A. The Indemnifying  Party will defend the  Indemnified  Party
against the matter with  counsel of its  choice satisfactory to  the Indemnified
Party;

                  B. The Indemnified Party may retain separate co-counsel at its
sole cost and expense  (except that the  Indemnifying  Party will be responsible
for  the  fees  and  expenses  of the  separate  co-counsel  to the  extent  the
Indemnified Party concludes that the counsel the Indemnifying Party has selected
has a conflict of interest);

                  C. The Indemnified  Party will not consent to the entry of any
judgment or enter  into any  settlement with  respect to the  matter without the
written consent of  the  Indemnifying  Party (not  to  be  withheld  or  delayed
unreasonably); and

                  D. The Indemnifying Party will not consent to the entry of any
judgment with respect to the matter, or enter into any settlement which does not
include a provision whereby the plaintiff or claimant in the matter releases the
Indemnified  Party from all liability with respect thereto,  without the written
consent of the Indemnified Party (not to be withheld or delayed unreasonably).

         If no Indemnifying  Party notifies the Indemnified Party within fifteen
(15) days after the  Indemnified  Party has given  notice of the matter that the
Indemnifying  Party is assuming the defense thereof,  then the Indemnified Party
may defend against,  or enter into any settlement with respect to, the matter in
any manner it may deem appropriate.

         10.4. Limitations on Indemnification. Notwithstanding the provisions of
Sections  10.1 or 10.2  hereof,  neither  party  shall  have  any  liability  to
indemnify  the  other  until  and to the  extent  that the  aggregate  amount of
indemnifiable  claims  hereunder  equals or exceeds  $5,000,  and the cap on any
indemnification claims hereunder shall in no event exceed an amount equal to one
half of the  value of  Buyer's  Stock  transferred  hereunder  valued  as of the
Closing Date.
POST-CLOSING AGREEMENTS.

         Consistency  in  Reporting.  Each party  hereto  agrees  that:  (i) the
transaction is intended to qualify as a tax-free  transaction  under the I.R.C.;
(ii) the  transaction  shall be reported  for Federal  income tax  purposes as a
tax-free  transaction;  (iii) for  purposes  of all  financial  statements,  tax
returns and reports,  and  communications  with third parties,  the transactions
contemplated in this agreement and ancillary or collateral  transactions will be
treated  as a  tax-free  transaction;  and (iv) if the  characterization  of any
transaction  contemplated  in this  agreement  or any  ancillary  or  collateral
transaction  is  challenged,  each party hereto will testify,  affirm and ratify
that  the   characterization   contemplated  in  such  agreement  was  with  the
characterization  intended by the party; provided,  however, that nothing herein
shall be construed as giving rise to any obligation if the reporting position is
determined  to  be  incorrect  by  final   decision  of  a  court  of  competent
jurisdiction. GENERAL PROVISIONS.

         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.

         Seller will cause the Company not to incur any  out-of-pocket  expenses
in connection with the Contemplated Transactions. 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.

         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 Company 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  Company's  employees,  customers,  and  suppliers  and others  having
dealings  with Seller will be informed  of the  Contemplated  Transactions,  and
Buyer will have the right to be present for any such communication.

         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 Company to
maintain in  confidence,  and not use to the  detriment of another  party or the
Company any written,  oral, or other  information  obtained in  confidence  from
another party or an Seller 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
or necessary or appropriate in connection with legal proceedings.

         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.  Whether or not the Closing takes place, Seller waives, and
will upon Buyer's request cause Seller to waive, any cause of action,  right, or
claim  arising  out of the access of Buyer or its  representatives  to any trade
secrets or other confidential information of the Company.

         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 (i) delivered by hand (with written confirmation of receipt);  (ii) sent by
telecopier  (with  written  confirmation  of receipt),  provided  that a copy is
mailed by registered  mail,  return receipt  requested or (iii) 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:
                                        AMG, Ltd..
                                        4182 Winters Chapel Road
                                        Doraville, GA 30360
                                        Attn: S. Randy Ragsdale, President

                  With a copy to:
                                        Paul Suda, Esq.
                                        1362 Salem Drive
                                        Alpharetta, GA 31141
                                        Attn: Paul Suda

                  Buyer:                Elite Technologies, Inc.
                                        3700 Crestwood Parkway
                                        Suite 1000
                                        Duluth, GA  30096

                  With a copy to:       Morris, Manning & Martin, L.L.P.
                                        1600 Atlanta Financial Center
                                        3343 Peachtree Road, N.E.
                                        Atlanta, Georgia 30326-1044
                                        Attention:   Bryan G. Harrison, Esq.
                                        Telecopy No.:  (404) 365-9532

         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 Georgia,
County of  Gwinnett,  or, if it has or can acquire  jurisdiction,  in the United
States  District  Court for the  Northern  District of Georgia,  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.

         Further  Assurances.  The parties  agree (i) to furnish upon request to
each other such further  information;  (ii) to execute and deliver to each other
such other  documents  and (iii) 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.

         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 this  Agreement  or the
documents  referred to in this  Agreement  can be  discharged  by one (1) 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 (1) 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.

         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)  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.

         Disclosure Schedule.
         -------------------

                  A. The  disclosures in the Disclosure  Schedule,  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  Schedule  (other than an
exception expressly set forth as such in the Disclosure Schedule with respect to
a specifically  identified  representation  or warranty),  the statements in the
body of this Agreement will control.

         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 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.

         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.

         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.

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

         Governing  Law.  This  Agreement  will be  governed by the laws  of the
          --------------
State of Georgia without regard to conflicts of laws principles.

         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.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00021-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00021-of-00352.parquet"}]]