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EXHIBIT 2.1 PLAN OF ACQUISITION
The Company has entered into a non-binding Letter of Intent and Term Sheet dated
February 22, 1999 between the Company's subsidiary, Alternative Materials
Technology, Inc. ("AMT USA") and U.S. Cellulose Co., Inc. ("USC"), whereby the
Company plans to acquire all of the issued and outstanding shares of USC in
consideration for $1,000,000 in cash (the "Acquisition"). USC is at arm's length
to the Company and AMT USA.
The closing of the transaction is subject to:
(i) The negotiation and execution of a definitive stock purchase
agreement and other required documents in connection therewith.
(ii) A satisfactory due diligence review by the Company, to be
completed within 90 days after the execution of the definitive
agreement and approval by the Company's auditors, legal counsel,
lenders and board of directors.
(iii) The Company raising sufficient capital to acquire all the
outstanding shares in cash.
(iv) The approval by USC of the terms of a severance benefit plan, not
to exceed $400,000,to be implemented by the Company for any of
USC's employees who are not retained by the Company after the
transaction.
The Company plans to primarily raise funds for the Acquisition through a Short
Form Offering Document and concurrently through private placement of additional
securities and the exercise by certain directors, officers and other persons of
previously issued warrants.
The Short Form Offering Document offers up to a total of 800,000 Units, at a
price of Cdn$0.80 per Unit, for maximum aggregate proceeds of Cdn$640,000, to
eligible qualified investors under the Securities Act ("British Columbia"). Each
Unit consists of one common share and one transferable purchase warrant. Two
such purchase warrants entitle a purchaser to acquire a further common share at
the price of Cdn$0.90 for twelve months following the date of issue. The
Offering will be conducted by Canaccord Capital Corporation, the Agent, on a
best efforts basis. The proposed private placement will proceed by way of
offering memorandum with the expected purchasers being eligible under the
Securities Act ("British Columbia") and of the Securities Rules ("British
Columbia"). The size of the private placement is to be up to 1,250,000 of units,
at a price of Cdn$0.80 per unit. Each unit will be comprised of one common share
and one non-transferable purchase warrant entitling the holder thereof to
acquire one additional common share at a price of Cdn$0.90 in the first year
following the closing of the private placement and at a price of Cdn$1.25 in the
second year following the closing of the private placement.
List of all omitted schedules
(i) Letter of Intent and Term Sheet
(ii) Agency Agreement
(iii) Short Form Offering Document
(iv) Offering Memorandum
The Company agrees that the aforementioned omitted schedules will be furnished.
upon written request by the United States Securities and Exchange Commission.
