STOCK OPTION AGREEMENT
This STOCK OPTION AGREEMENT (the "Agreement"), dated as of July 20, 1999,
made by and between Controlling Shareholders of Universal Alliance, Inc., a
Nevada corporation, with its place of business located at 0000 Xxxxxx Xxxxxxx
Xxxxx, Xxxxxxxxx, XX 00000 ("Optionor"), and Bio-American Capital Corporation, a
Nevada corporation, with its place of business located at 000 Xxxxxxx Xxxxxx,
Xxxxx 000, Xxxxxx Xxxxx, XX 00000 ("Optionee"). Universal Alliance, Inc. and
Bio-American Capital Corporation shall sometimes be referred to as UAI and BACC
respectfully. Controlling Shareholders shall included those shareholders which
collectively own at least 80% of the issued and outstanding stock, and rights to
acquire stock in UAI.
In consideration of ten dollars and no/100ths and other good and valuable
consideration Optionor hereby grants to the Optionee, its successors, the right
to acquire and receive from Optionor at least 80% of the issued and outstanding
stock, and rights to acquire stock in UAI in exchange for common stock of BACC,
or its successors, on the terms herein provided (the "Option").
In consideration of the foregoing and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
for the purpose of defining the terms and provisions of this Agreement and the
Option hereby granted, Optionor and Optionee hereby agree as follows:
1. Terms of Exercise. Optionee must exercise the Option granted herein
before March 31, 2000. Optionee may exercise the Option by meeting the
"Conditions Precedent to the Exercise of the Option" set forth in Section 2 and
delivering to "Escrow Agent" (mutually agreed to) the shares of BACC common
stock (the "Exchange Shares") set forth in Section 4 for each share of UAI
common stock (the "Exercise Price") for which Optionee is exercising the Option.
2. Conditions Precedent to the Exercise of the Option.
a.) BACC to file Form 10-SB with the Securities and Exchange Commission on
or before July 30, 1999, and comply with all future disclosure
requirements of a fully-reporting company;
b.) BACC Management to assist UAI in the successful completion of the
draft Private Offering Memorandum for $2,000,000 of Convertible Notes;
c.) Average price of BACC common stock traded on the Over-the-Counter
Bulletin Board, during the period August 1, 1999, through September
30, 1999, to be least $2.00 per share;
d.) Tax-free exchange of BACC common stock for UAI common stock;
e.) Successful filing of a registration statement that registers up to 25%
of the BACC common stock to be acquired by the UAI Controlling
Shareholders; and
f.) Prior to March 31, 2000.
g.) Mutual agreement on Escrow Agent; which agreement will not be
unreasonably withheld.
3. BACC's Obligations. BACC shall not be obligated to complete any or all
of the Conditions Precedent set forth in Section 2 prior to the Exercise of the
Option.
4. Share Exchange Consideration for UAI Stock. BACC will issue to UAI
Controlling Shareholders one and one-half (1.5) shares of common stock of BACC
for each share of UAI common stock. No fractional shares of Exchange Shares
shall be issued to the UAI Controlling Shareholders, and any fractional share to
which the UAI Controlling Shareholders would otherwise be entitled shall be
rounded off to the nearest whole share.
5. Registration Rights. Upon issuance, seventy-five percent (75%) of the
Shares will not been registered under the Securities Act of 1933, as amended,
for purposes of public distribution. BACC will agree to prepare and file, upon
request of the holders of the Shares, a registration statement to register up to
25% of the Stock each six months following the closing of the transaction. Such
registration is subject to any terms required by an underwriter of any secondary
offering.
6. Representations, Warranties and Covenants of Optionor. Optionor hereby
represents and warrants, as of the date of this Agreement and as of the date
upon which Optionee exercises the Option, as follows:
a) None of the representations or warranties made by Optionor
contains any untrue statement of material fact, or omits to state any material
fact necessary to make the statements made, in the light of the circumstances
under which they were made, not misleading.
b) Optionor owns all right, title, and interest to the Shares, and
the Shares are and will be free and clear of any and all liens, claims, and
encumbrances of any kind or nature.
7. No Third-Party Beneficiaries. This Agreement shall not confer any
rights or remedies upon any person other than the parties and their respective
successors and permitted assigns.
8. Entire Agreement. This Agreement constitutes the entire agreement among
the parties and supersedes any prior understandings, agreements, or
representations by or among the parties, written or oral, to the extent they
related in any way to the subject matter hereof.
9. Succession and Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties named herein and their respective successors
and permitted assigns. No party may assign either this Agreement or any of his
or its rights, interests, or obligations hereunder without the prior written
approval of the Optionor.
10. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
11. Notices. All notices, requests, demands, claims, and other
communications hereunder will be in writing. Any notice, request, demand, claim,
or other communication hereunder shall be deemed duly given on the date of
delivery, if delivered by hand or by telecopy with machine confirmation to the
persons identified below, or three (3) days after mailing if mailed by
registered or certified mail, return receipt requested, postage prepaid, and
addressed to the intended recipient at the address set out hereinabove. Any
party may change the address to which notices, requests, demands, claims, and
other communications hereunder are to be delivered by giving the other parties
notice in the manner herein set forth.
12. Governing Law. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of California and the United
States without giving effect to any choice or conflict of law provision or rule
(whether of the State of California or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of
California and the United States.
13. Dispute Resolution. The parties hereto deem it to be in their
respective best interests to settle any dispute as expeditiously and
economically as possible. Therefore, the parties expressly agree to submit any
dispute between them arising out of or relating to this Agreement ("Dispute") to
mediation and, if necessary, arbitration. The parties hereto thus expressly
waive any rights they may have to trial by jury with respect to such dispute.
The dispute resolution proceedings shall be conducted in San Diego, California.
14. Amendments and Waivers. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by the
Optionor and Optionee. No waiver by any party of any default, misrepresentation,
or breach of warranty or covenant hereunder, whether intentional or not, shall
be deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant hereunder or affect in any way any rights arising
by virtue of any prior or subsequent such occurrence.
15. Severability. If any term, provision, condition or covenant of this
Agreement or the application thereof to any party or circumstances shall be held
to be invalid or unenforceable to any extent in any jurisdiction, then the
remainder of this Agreement and the application of such term, provision,
condition or covenant in any other jurisdiction or to persons or circumstances
other than those as to whom or which it is held to be invalid or unenforceable,
shall not be affected thereby, and each term, provision, condition and covenant
of this Agreement shall be valid and enforceable to the fullest extent permitted
by law.
16. Expenses. Each of the parties will bear his or its own costs and
expenses (including legal fees and expenses) incurred in connection with this
Agreement and the transactions contemplated hereby. In the event legal action is
necessary to enforce this Agreement, the prevailing party shall be entitled to
an award of all its reasonable attorney's fees and costs incurred in connection
with enforcement of this Agreement
17. Construction.
a. Words. All references in this Agreement to the singular shall
include the plural, the plural shall include the singular where applicable, and
all references to gender shall include both genders and the neuter. All
references in this Agreement to days shall be calendar days unless specified as
business days. All accounting terms not otherwise identified herein shall have
the meanings assigned to them in accordance with General Accepted Accounting
Principles consistently applied.
b. Cross-References. References in this Agreement to any Section
shall include all Subsections, and Paragraphs in such Section; and references in
this Agreement to any Subsection shall include all Paragraphs in such
Subsection. Words "herein," "hereof," "hereunder" and words of similar import
refer to this Agreement as a whole and not to any particular paragraph or other
subdivision unless the context otherwise so admits.
c. Headings. The table of contents and the headings to each Section
and Subsection herein are for the purposes of convenience only and shall not be
read or interpreted as having any meaning or effect.
[Signatures on Following Page]
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement with legal and binding effect as of the date and year first above
written.
Optionee:
---------
------------------------------
Bio-American Capital Corporation
By: Xxxxxxx Viejo, President
Optionor(s):
------------
---------------- ----------------
Xxxxx X. Xxxxxxx Xxxxxxx X. Xxxxxx
---------------- ----------------
Xxxxx Xxxxxxxx Xxxxx Xxxxx
------------------ -------------------
Bonnechi Finance, Ltd Xxxxxx Finance, Ltd.
By: Xxxxxx Xxxxx Park, Authorized By: Xxxxx Xxxxx, Authorized Signature
Signatory
----------------- -------------------
Xxxxxxx House, Ltd. Xxxxxxx Group, Ltd.
By: Xxxx X. Xxxxx, Authorized Signatory By: Xxxxx Xxxx, Authorized Signatory
----------------- ----------------------
Holder Row, Ltd Oceania Custodian, Ltd
By: Xxxxx Xxxxxx, Authorized Signatory. By: Xxxx Xxxxxxxx, Director
----------------------- ------------------------
Yellowstone Securities, Ltd. NCSS International, Ltd.
By: Xxxxx X. XxXxxx, Authorized By: Xxxx Xxxxxxxx Xxxxxx, Authorized
Signatory Signatory
--------------
Xxx Xxxxxxx
STATE OF ______________ )
)ss.
COUNTY OF ______________ )
On November ____, 1998, before me, __________________, a notary public
in and for said state, personally appeared Xxx Xxxxx, personally known to me to
be the person whose name is subscribed to the within instrument and acknowledged
to me that he executed the same in his authorized capacities, and that by his
signature on the instrument the entity upon behalf of which the persons acted,
executed the instrument.
WITNESS my hand and official seal.
My commission Expires:
-----------------------------
Notary Public
