Agreement And Plan of Share Exchange

AGREEMENT AND PLAN OF SHARE EXCHANGE


by and among


Teda Hotels Management Company Limited,
a British Virgin Islands Corporation,


and


Teda Travel Incorporated,
a Florida corporation,
the Sole Stockholder of Teda BVI Limited


on the one hand;


and


Acola Corp.,
a Delaware corporation


and


the Majority Stockholders of Acola Corp.,


on the other hand


March 10, 2004


AGREEMENT AND PLAN OF SHARE EXCHANGE


This Agreement and Plan of Share Exchange, dated as of March 10, 2004 (this "Agreement"), is made and entered into by and among Teda Hotels Management Company Limited , a British Virgin Islands corporation ("Teda BVI"), and Teda Travel Incorporated, a Florida corporation which is the sole stockholder of Teda BVI (the "Teda Stockholder"), on the one hand, and Acola Corp., a Delaware corporation ("Acola"), James N. Baxter and Donald E. Baxter, individuals who own at least a majority of Acola's outstanding capital stock (the "Acola Stockholders"), on the other hand.


WHEREAS, the respective Boards of Directors of Teda BVI, the Teda Stockholder and Acola have adopted resolutions approving and adopting the proposed share exchange (the "Exchange") upon the terms and conditions hereinafter set forth in this Agreement;


WHEREAS, the Board of Directors of Acola and the holders of a majority of its Common Stock have adopted an amendment to its certificate of incorporation to effect a one-for-forty reverse stock split and to reclassify all of Acola's Class B shares of Common Stock as Class A share and to eliminate the Class B shares so that all Acola Common Stock will have equal rights, all effective March 8, 2004 (the "Acola Split").


WHEREAS, the Exchange shall be 95% of all the issued and outstanding Acola common stock for the entire issued and outstanding Teda BVI common stock;


WHEREAS, the Teda Stockholder holds 100 shares of Teda BVI's common stock (the "Teda BVI Shares"), which represent all of the issued and outstanding capital stock of Teda BVI, and the Teda Stockholder desires to participate in the Exchange;


WHEREAS, the Acola Stockholders hold 31,489,198 shares of Acola common stock and 1,940,000 shares of Acola Class B common stock prior to the Acola Split, which shall become 835,730 shares of Acola common stock after the Acola Split (the "Acola Shares"), which represent a majority of the issued and outstanding capital stock of Acola, and the Acola Stockholders desire to participate in the Exchange;


WHEREAS, Teda BVI will enter into this Agreement for the purpose of evidencing its consent to the consummation of the Exchange and for the purpose of making certain representations, warranties, covenants and agreements;


WHEREAS, the Acola Stockholders will enter into this Agreement for the purpose of making certain representations, warranties, covenants, indemnifications and agreements;


WHEREAS, it is intended that the terms and conditions of this Agreement comply in all respects with Section 368(a) of the Code and the regulations corresponding thereto, so that the Exchange shall qualify as a tax free reorganization under the Code;


NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as follows:


ARTICLE 1
THE EXCHANGE


1.1 The Exchange. Upon the terms and subject to the conditions hereof, at the Closing (as hereinafter defined) the Teda Stockholder will sell, convey, assign, transfer and deliver to Acola one or more stock certificates representing the entire issued and outstanding capital of Teda BVI, and Acola will issue to the Teda Stockholder, in exchange for the Teda BVI Shares, one or more stock certificates representing an aggregate of 19,714,915 shares of Acola


common stock (the "Acola Shares"), par value $.001 per share ("Acola Common Stock").


1.2 Closing. The closing of the Exchange (the "Closing") shall take place on or before March 15, 2004, or on such other date as may be mutually agreed upon by the parties. Such date is referred to herein as the "Closing Date."


ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF TEDA BVI


Teda BVI hereby represents and warrants to Acola as follows:


2.1 Organization. Teda BVI has been duly incorporated, is validly existing as a corporation and is in good standing under the laws of its jurisdiction of incorporation, and has the requisite power to carry on its business as now conducted.


2.2 Capitalization. The authorized capital stock of Teda BVI consists of 50,000 shares of common stock, U.S. $1 par value, of which 100 shares are issued and outstanding, and no shares of preferred stock. All of the issued and outstanding shares of capital stock of Teda BVI are duly authorized, validly issued, fully paid, non-assessable and free of preemptive rights. There are no outstanding or authorized options, rights, warrants, calls, convertible securities, rights to subscribe, conversion rights or other agreements or commitments to which Teda BVI is a party or which are binding upon Teda BVI providing for the issuance or transfer by Teda BVI of additional shares of its capital stock and Teda BVI has not reserved any shares of its capital stock for issuance, nor are there any outstanding stock option rights, phantom equity or similar rights, contracts, arrangements or commitments which are binding upon Teda BVI. There are no voting trusts or any other agreements or understandings with respect to the voting of Teda BVI's capital stock.


2.3 Certain Corporate Matters. Teda BVI is duly qualified to do business as a corporation and is in good standing in each jurisdiction in which the ownership of its properties, the employment of its personnel or the conduct of its business requires it to be so qualified, except where the failure to be so qualified would not have a material adverse effect on Teda BVI's financial condition, results of operations or business. Teda BVI has full corporate power and authority and all authorizations, licenses and permits necessary to carry on the business in which it is engaged and to own and use the properties owned and used by it.


2.4 Authority Relative to this Agreement. Teda BVI has the requisite power and authority to enter into this Agreement and to carry out its obligations hereunder. The execution, delivery and performance of this Agreement by Teda BVI and the consummation by Teda BVI of the transactions contemplated hereby have been duly authorized by the Teda Stockholder and the Board of Directors of Teda BVI and no other actions on the part of Teda BVI are necessary to authorize this Agreement or the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by Teda BVI and constitutes a valid and binding agreement of Teda BVI, enforceable against Teda BVI in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors' rights generally or by general principles of equity.


2.5 Consents and Approvals; No Violations. Except for requirements of applicable law, no filing with, and no permit, authorization, consent or approval of, any third party, public body or authority is necessary for the consummation by Teda BVI of the transactions contemplated by this Agreement. Neither the execution and delivery of this Agreement by Teda BVI nor the consummation by Teda BVI of the transactions contemplated hereby, nor compliance


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by Teda BVI with any of the provisions hereof, will (a) conflict with or result in any breach of any provisions of the organizational documents of Teda BVI, (b) result in a violation or breach of, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, license, contract, agreement or other instrument or obligation to which Teda BVI is a party or by which it or its properties or assets may be bound or (c) violate any order, writ, injunction, decree, statute, rule or regulation applicable to Teda BVI, or any of its properties or assets, except in the case of clauses (b) and (c) for violations, breaches or defaults which are not in the aggregate material to Teda BVI taken as a whole.


2.6 Financial Statements. The audited consolidated balance sheets of Teda BVI as of December 31, 2002 and consolidated statements of operations and cash flows for the twelve months then ended (collectively, the "Teda BVI Financial Statements") together with the unqualified auditor's report by Jimmy Cheung & Co. are filed as Exhibit A to this Agreement.


2.7 Absence of Material Changes. Since December 31,2002, there has not been any material adverse change in the condition (financial or otherwise) of the properties, assets, liabilities or business of Teda BVI, except changes in the ordinary course of business which, individually and in the aggregate, have not been materially adverse.


2.8 Title to Assets. Teda BVI has good and marketable title to all of the assets and properties now carried on its books including those reflected in the most recent balance sheet contained in the Teda BVI Financial Statements, free and clear of all liens, claims, charges, security interests or other encumbrances, except as described in the Teda BVI Financial Statements or arising thereafter in the ordinary course of business (none of which will be material).


2.9 Disclosure. The representations and warranties and statements of fact made by Teda BVI in this Agreement are, as applicable, accurate, correct and complete and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements and information contained herein not false or misleading.


ARTICLE 3
REPRESENTATIONS AND WARRANTIES
OF THE TEDA STOCKHOLDER


The Teda Stockholder hereby represents and warrants to Acola and the Acola Stockholders as follows:


3.1 Ownership of the Teda BVI Shares. The Teda Stockholder owns, beneficially and of record, good and marketable title to the Teda BVI Shares, free and clear of all security interests, liens, adverse claims, encumbrances, equities, proxies, options or stockholders' agreements. At the Closing, the Teda Stockholder will convey to Acola good and marketable title to the Teda BVI Shares, free and clear of any security interests, liens, adverse claims, encumbrances, equities, proxies, options, stockholders' agreements or restrictions.


3.2 Authority Relative to this Agreement. The execution, delivery and performance of this Agreement by the Teda Stockholder and the consummation by the Teda Stockholder of the transactions contemplated hereby have been duly authorized by the Teda Stockholder, and no other actions on the part of the Teda Stockholder are necessary to authorize this Agreement or the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by the Teda Stockholder and constitutes a valid and binding agreement of the Teda Stockholder, enforceable against the Teda Stockholder in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors' rights generally or by general principles of equity.


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3.3 Consents and Approvals; No Violations. Except for requirements of applicable laws, no filing with, and no permit, authorization, consent or approval of, any public body or authority is necessary for the consummation by the Teda Stockholder of the transactions contemplated by this Agreement. Neither the execution and delivery of this Agreement by the Teda Stockholder nor the consummation by the Teda Stockholder of the transactions contemplated hereby, nor compliance by the Teda Stockholder with any of the provisions hereof, will (a) result in a violation or breach of, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, license, contract, agreement or other instrument or obligation to which the Teda Stockholder is a party or by which the Teda Stockholder or his property may be bound or (b) violate any order, writ, injunction, decree, statute, rule or regulation applicable to the Teda Stockholder, except in the case of clauses (a) and (b) for violations, breaches or defaults which are not in the aggregate material to the Teda Stockholder.


3.6 Restricted Securities. The Teda Stockholder acknowledges that the Acola Shares will not be registered pursuant to the Securities Act of 1933, as amended (the "Securities Act") or any applicable state securities laws, that the Acola Shares will be characterized as "restricted securities" under federal securities laws, and that under such laws and applicable regulations the Acola Shares cannot be sold or otherwise disposed of without registration under the Securities Act or an exemption therefrom. In this regard, the Teda Stockholder is familiar with Rule 144 promulgated under the Securities Act, as currently in effect, and understands the resale limitations imposed thereby and by the Securities Act.


3.7 Accredited Investor. The Teda Stockholder is an "Accredited Investor" as that term is defined in rule 501 of Regulation D promulgated under the Securities Act. The Teda Stockholder is able to bear the economic risk of acquiring the Acola Shares pursuant to the terms of this Agreement, including a complete loss of the Teda Stockholder's investment in the Acola Shares.


3.7 Legend. The Teda Stockholder acknowledges that the certificate(s) representing the Acola Shares shall each conspicuously set forth on the face or back thereof a legend in substantially the following form:


THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS
TO THE SECURITIES UNDER SAID ACT OR PURSUANT TO AN EXEMPTION FROM
REGISTRATION OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT
SUCH REGISTRATION IS NOT REQUIRED.


ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF
ACOLA AND THE ACOLA STOCKHOLDER


Acola and the Acola Stockholders hereby represent and warrant, jointly and severally, to Teda BVI and the Teda Stockholder as follows:


4.1 Organization. Acola is a corporation duly organized, validly existing and in good standing under the laws of the state of its incorporation, and has the requisite corporate power to carry on its business as now conducted.


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4.2 Capitalization. Acola's authorized capital stock consists of 105,000,000 shares of capital stock, of which 100,000,000 shares are designated as Common Stock, of which 41,505,065 shares are issued and outstanding and of which 1,037,627 shares, after the Acola Split, will be issued and outstanding at the Closing and of which 5,000,000 shares are designated as Preferred Stock, of which no shares are and at the Closing will be issued. All issued and outstanding shares of Acola Common Stock are duly authorized, validly issued, fully paid, non-assessable and free of preemptive rights. When issued, the Acola Shares will be duly authorized, validly issued, fully paid, non-assessable and free of preemptive rights, there are no outstanding or authorized options, rights, warrants, calls, convertible securities, rights to subscribe, conversion rights or other agreements or commitments to which Acola is a party or which are binding upon Acola providing for the issuance by Acola or transfer by Acola of additional shares of Acola's capital stock and Acola has not reserved any shares of its capital stock for issuance, nor are there any outstanding stock option rights, phantom equity or similar rights, contracts, arrangements or commitments to issue capital stock of Acola. There are no voting trusts or any other agreements or understandings with respect to the voting of Acola's capital stock.


4.3 Certain Corporate Matters. Acola is duly licensed or qualified to do business and is in good standing as a foreign corporation in every jurisdiction in which the character of Acola's properties or nature of Acola's business requires it to be so licensed or qualified other than such jurisdictions in which the failure to be so licensed or qualified does not, or insofar as can reasonably be foreseen, in the future will not, have a material adverse effect on its financial condition, results of operations or business. Acola has full corporate power and authority and all authorizations, licenses and permits necessary to carry on the business in which it is engaged or in which it proposes presently to engage and to own and use the properties owned and used by it. Acola has delivered to Teda BVI true, accurate and complete copies of its certificate or articles of incorporation and bylaws, which reflect all restatements of and amendments made thereto at any time prior to the date of this Agreement. The records of meetings of the stockholders and Board of Directors of Acola are complete and correct in all material respects. The stock records of Acola and the stockholder lists of Acola that Acola has previously furnished to Teda BVI are complete and correct in all material respects and accurately reflect the record ownership and the beneficial ownership of all the outstanding shares of Acola's capital stock and any other outstanding securities issued by Acola. Acola is not in default under or in violation of any provision of its certificate or articles of incorporation or bylaws in any material respect. Acola is not in any material default or in violation of any restriction, lien, encumbrance, indenture, contract, lease, sublease, loan agreement, note or other obligation or liability by which it is bound or to which any of its assets is subject.


4.4 Authority Relative to this Agreement. Acola has the requisite corporate power and authority to enter into this Agreement and carry out its obligations hereunder. The execution, delivery and performance of this Agreement by Acola and the consummation of the transactions contemplated hereby have been duly authorized by the Board of Directors of Acola and no other actions on the part of Acola are necessary to authorize this Agreement or the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by Acola and constitutes a valid and binding obligation of Acola, enforceable in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors' rights generally or by general principles of equity.


4.5 Consents and Approvals; No Violations. Except for applicable requirements of federal securities laws and state securities or blue-sky laws, no filing with, and no permit, authorization, consent or approval of, any third party, public body or authority is necessary for the consummation by Acola of the transactions contemplated by this Agreement. Neither the execution and delivery of this Agreement by Acola nor the consummation by Acola of the transactions contemplated hereby, nor compliance by Acola with any of the provisions hereof, will (a) conflict with or result in any breach of any provisions of the charter or Bylaws of Acola, (b) result in a violation or breach of, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, license, contract, agreement or other instrument or obligation to which Acola is a party or by which it or any of its properties or assets may be bound or (c) violate any order, writ, injunction, decree, statute, rule or


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regulation applicable to Acola, or any of its properties or assets, except in the case of clauses (b) and (c) for violations, breaches or defaults which are not in the aggregate material to Acola taken as a whole.


4.6 SEC Documents. Acola hereby makes reference to the following documents filed with the United States Securities and Exchange Commission (the "SEC"), as posted on the SEC's website, WWW.SEC.GOV: (collectively, the "SEC Documents"): (a) Annual Report on Form 10-KSB for the fiscal year ended June 30, 2003, 2002, 2001 and 2000; (b) General Form For Registration of Securities Of Small Business Issuers on Form 10-SB12G as filed on September 3, 1999, and all amendments thereto; and (c) Quarterly Reports on Form 10-QSB for the periods ended December 31, 1999, 2000, 2001, 2002 and 2003 March 31, 2000, 2001, 2002 and 2003, and September 30, 2000, 2001, 2002 and 2003, and all amendments thereto. The SEC Documents constitute all of the documents and reports that Acola was required to file with the SEC pursuant to the Securities Exchange Act of 1934 ("Exchange Act") and the rules and regulations promulgated thereunder by the SEC since the effectiveness of Acola's Form 10-SB12G filed on September 3, 1999. As of their respective dates, the SEC Documents complied in all material respects with the requirements of the Exchange Act and the rules and regulations promulgated thereunder and none of the SEC Documents contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of Acola included in the SEC Documents comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto, have been prepared in accordance with generally accepted accounting principles in the United States (except, in the case of unaudited statements, as permitted by the applicable form under the Exchange Act) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the financial position of Acola as of the dates thereof and its statements of operations, stockholders' equity and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal and recurring year-end audit adjustments which were and are not expected to have a material adverse effect on Acola, its business, financial condition or results of operations). Except as and to the extent set forth on the consolidated balance sheet of Acola as of June 30, 2003, including the notes thereto, Acola has no liability or obligation of any nature (whether accrued, absolute, contingent or otherwise and whether required to be reflected on a balance sheet or not), except for liabilities and obligations incurred in the ordinary course of business consistent with past practices since June 30, 2003 which in the aggregate could not reasonably be expected to have a material adverse effect on Acola, its business, financial condition or results of operations.


4.7 Financial Statements.


(a) Included in the SEC Documents are the audited balance sheet of Acola as at June 30, 2003, and the related statements of income, stockholders' equity and cash flows for the two years then ended, together with the unqualified report thereon (except with respect to continuation as a going concern) of Harper & Pearson Company ("Harper"), independent auditor (collectively, "Acola's Audited Financials").


(b) Included in the SEC Documents are the unaudited balance sheets of Acola as at Dece ...