AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION ("Plan") is made this 9th day
of June, 2002, among Suncrest Global Energy Corp. (fka, Galaxy Specialties,
Inc.), a Nevada corporation ("Suncrest"); Coyote Oil Company, Inc., a Nevada
corporation, (hereinafter referred to as "Coyote Oil") and their Shareholders
(hereinafter collectively referred to as "Shareholders").
Suncrest wishes to acquire all the issued and outstanding stock of
Coyote Oil for and in exchange for stock of Suncrest, in a stock-for-stock
transaction intending to qualify as a tax-free exchange pursuant to Section
368(a)(1)(B) of the Internal Revenue Code of 1986, as amended. The parties
intend for this Plan to represent the terms and conditions of such tax-free
reorganization, which Plan the parties hereby adopt.
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, IT IS AGREED:
Section 1
Terms of Exchange
1.1 Number of Shares. At the Closing, the Shareholders will assign,
transfer, and deliver to Suncrest, free and clear of all liens, pledges,
encumbrances, charges, restrictions or known claims of any kind, nature or
description, 10,000,000 shares of Coyote Oil common shares, which represents
100% of the issued and outstanding shares of Coyote Oil, in exchange for
2,000,000 shares of Suncrest's preferred shares, par value $.01, of which
2,000,000 preferred shares shall be delivered at the Closing and subject to
the provisions of this Plan. Subsequent to the date hereof, the Shareholders
shall, upon the surrender of the Coyote Oil certificates representing its
beneficial and record ownership of the issued and outstanding shares of Coyote
Oil to Suncrest or as soon as practicable hereafter, and pursuant to the
exemptions from the registration provisions of Section 5 of the Securities Act
of 1933, provided by Sections 3 and 4 of that act, the Shareholders shall be
entitled to receive an exchange certificate(s) evidencing shares of Suncrest
stock as provided for herein. Upon the consummation of the transaction
contemplated herein, Coyote Oil shall be a wholly-owned subsidiary of
Suncrest.
1.2 Registration of Suncrest Shares. In the event that within one (1)
year from the date hereof, Suncrest undertakes to file a Registration
Statement under the Securities Act of 1933, as amended, for the purpose of
offering and/or selling a minimum of one hundred thousand dollars ($100,000)
of common stock in any single registered offering, then if practicable, and
subject to the amount of the underwriter(s) the Shareholders shall have the
right to include a portion of the shares in the Registration Statement. Said
"Piggy Back" registration right shall allow the Shareholders to offer for sale
under the Registration Statement a minimum of thirty percent (30%) of the
total shares being offered under such Registration Statement by Suncrest.
That percentage may be increased by the mutual consent of Suncrest, the
Shareholders and the underwriters(s).
1.3 Anti-Dilution. For all relevant purposes of this Plan, the number
of Suncrest shares to be issued and delivered pursuant to this Plan, shall be
appropriately adjusted to take into account any stock split, stock dividend,
reverse stock split, recapitalization, or similar change in Suncrest common
stock, which may occur before the execution of the Plan.
1.4 Delivery of Certificates. The Shareholders shall transfer to
Suncrest at the closing provided for in Section 2 (the "Closing") 10,000,000
shares of common stock of Coyote Oil listed opposite their respective names on
Exhibit A hereto (the "Coyote Oil Shares") in exchange for shares of the
common stock of Suncrest as outlined above in Section 1.1 hereof (the
"Suncrest Stock"). All of such shares of Suncrest Stock shall be issued at
the closing to the Shareholders. The transfer of Coyote Oil Shares by the
Shareholders shall be effected by the delivery to Suncrest at the Closing of
one or more certificates representing the Coyote Oil shares, endorsed in blank
or accompanied by stock powers executed in blank.
1.5 Further Assurances. Subsequent to the execution hereof, and from
time to time thereafter, the Shareholders shall execute such additional
instruments and take such other action as Suncrest may reasonably request in
order to more effectively sell, transfer and assign clear title and ownership
in the Coyote Oil Shares to Suncrest.
Section 2
Closing
2.1 Closing. The Closing contemplated by Section 1.4 shall be held at
the law office of Xxxxxx X. Xxxxxxx, 2157 Lincoln Street, Salt Lake City, Utah
on or before June 10, 2003 or at such other time or place as may be mutually
agreed upon in writing by the parties. The Closing may also be accomplished
by wire, express mail or other courier service, conference telephone
communications or as otherwise agreed by the respective parties or their duly
authorized representatives. In any event, the closing of the transactions
contemplated by this Plan shall be effected as soon as practicable after all
of the conditions contained herein have been satisfied.
2.2 Closing Events. At the Closing, each of the respective parties
hereto shall execute, acknowledge and deliver (or shall cause to be executed,
acknowledged, and delivered) any agreements, resolutions, rulings, or other
instruments required by this Plan to be so delivered at or prior to Closing,
together with such other items as may be reasonably requested by the parties
hereto and their respective legal counsel in order to effectuate or evidence
the transaction contemplated hereby.
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Section 3
Representations, Warranties and Covenants of Suncrest
Suncrest represents and warrants to, and covenants with, the
Shareholders and Coyote Oil as follows:
3.1 Corporate Status. Suncrest is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada.
Suncrest has full corporate power and is duly authorized, qualified,
franchised, and licensed under all applicable laws, regulations, ordinances,
and orders of public authorities to own all of its properties and assets and
to carry on its business on all material respects as it is now being
conducted, and there is no other jurisdiction in which the character and
location of the assets owned by it, or the nature of the business transacted
by it, requires qualification. Included in the Suncrest schedules (defined
below) are complete and correct copies of its Articles of Incorporation and
Bylaws as in effect on the date hereof. The execution and delivery of this
Plan does not, and the consummation of the transactions contemplated hereby
will not, violate any provision of Suncrest's Articles of Incorporation or
Bylaws. Suncrest has taken all action required by law, its Articles of
Incorporation, its Bylaws, or otherwise, to authorize the execution and
delivery of this Plan.
3.2 Capitalization. The authorized capital stock of Suncrest as of the
date hereof consists of 70,000,000 common shares, par value $.001. As of the
date hereof there are 18,050,000 common shares of Suncrest issued and
outstanding and no preferred shares issued and outstanding. The foregoing
shares constitute fully paid, non-assessable shares.
3.3 Options and Rights. Suncrest has no stock options outstanding at
this time.
3.4 Financial Statements.
(a) Suncrest hereby warrants and covenants to Coyote Oil that the
audited financial statements for the years ended June 30, 2002 and 2001,
fairly and accurately represent the financial condition of Suncrest and that
the same will be prepared along with the period ended as of the date of
Closing, for consolidation by an independent public accountant, which shall be
prepared in accordance with generally accepted accounting principles
consistently applied, on or before the expiration of ninety days from the date
of Closing.
(b) Suncrest hereby warrants and represents that the audited
financial statements for the periods set forth in subparagraph (a), supra,
fairly and accurately represent the financial condition of Suncrest as
submitted heretofore to Coyote Oil for examination and review.
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3.5 Conduct of Business. Suncrest will use its best efforts to maintain
and preserve its business organization, employee relationships and goodwill
intact, and will not, without the prior written consent of Coyote Oil, enter
into any material commitments except in the ordinary course of business.
Suncrest will conduct itself in the following manner pending the
Closing:
(a) Certificate of Incorporation and Bylaws. The only change
that will be made in the Articles of Incorporation will be changing the name
to Suncrest Global Energy Corp. and a change in the authorized common stock of
the company including the creation of a preferred class of stock. The Bylaws
of Suncrest shall not be amended.
(b) Capitalization, etc. Except for the amendment abovementioned
above, Suncrest will not change its authorized or issue shares of any class,
declare or pay ay dividend or other distribution, or issue, encumber, purchase
or otherwise acquire any of its shares of any class.
3.6 Title to Property. Suncrest has good and marketable title to all
of its properties and assets, real and personal, proprietary or otherwise, as
will be reflected in the balance sheets of Suncrest, and the properties and
assets of Suncrest are subject to no mortgage, pledge, lien or encumbrance,
unless as otherwise disclosed in its financial statements.
3.7 Litigation. There are no material actions, suits, or proceedings,
pending, or, to the best knowledge of Suncrest, threatened by or against or
affecting Suncrest at law or in equity, or before any governmental agency or
instrumentality, domestic or foreign, or before any arbitrator of any kind;
Suncrest does not have any knowledge of any default on its part with respect
to any judgment, order, writ, injunction, decree, warrant, rule, or regulation
of any court, arbitrator, or governmental agency or instrumentality.
3.8 Books and Records. From the date hereof until closing, and for any
reasonable period subsequent thereto, Suncrest and its present management will
(I) give to the Shareholders and Coyote Oil, or their duly authorized
representatives, full access, during normal business hours, to all of its
books, records, contracts and other corporate documents and properties so that
the Shareholders and Coyote Oil, or their duly authorized representatives, may
inspect them; and (ii) furnish such information concerning the properties and
affairs of Suncrest as the Shareholders and Coyote Oil, or their duly
authorized representatives, may reasonably request.
3.9 Confidentiality. Until the Closing (and thereafter if there is no
Closing), Suncrest and its representatives will keep confidential any
information which they obtain from the Shareholders or from Coyote Oil
concerning its properties, assets and the proposed business operations of
Coyote Oil. If the terms and conditions of this Plan imposed on the parties
hereto are not consummated on or before 5:00 p.m. MST on July 1, 2003 or
otherwise waived or extended in writing to a date mutually agreeable to the
parties hereto, Suncrest will return to Coyote Oil all written matter with
regard to Coyote Oil obtained in connection with the negotiations or
consummation of this Plan.
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3.10 Conflict with Other Instruments. The transactions contemplated by
this Plan will not result in the breach of any term or provision of, or
constitute a default under any indenture, mortgage, deed of trust, or any
material agreements or instrument to which Suncrest was or is a party, or to
which any of its assets or operations are subject, and will not conflict with
any provision of the Articles of Incorporation or Bylaws of Suncrest.
3.11 Corporate Authority. Suncrest has full corporate power and
authority to enter into this Plan and to carry out its obligations hereunder
and will deliver to the Shareholders and Coyote Oil, or their respective
representatives, at the Closing, a certified copy of resolutions of its Board
of Directors authorizing execution of this Plan by its officers and
performance thereunder.
3.12 Special Covenants and Representations Regarding the Exchanged
Suncrest Stock. The consummation of this Plan and the transactions herein
contemplated include the issuance of the exchanged Suncrest shares to the
Shareholders, which constitutes an offer and sale of securities under the
Securities Act of 1933, as amended, and applicable states' securities laws.
Such transaction shall be consummated in reliance on exemptions from the
registration and prospectus requirements of such statutes which depend inter
alia on the circumstances under which the Shareholders acquire such
securities. In connection with the reliance upon exemptions from the
registration and prospectus delivery requirements for such transactions, at
the Closing, Shareholders shall cause to be delivered to Suncrest a Letter(s)
of Investment Intent in the form attached hereto as Exhibit B and incorporated
herein by reference.
3.13 Undisclosed or Contingent Liabilities. Suncrest hereby represents
and warrants that it has no undisclosed or contingent liabilities which have
not been disclosed to Coyote Oil.
3.14 Information. The information concerning Suncrest set forth in
this Plan, and the Suncrest schedules attached hereto, are complete and
accurate in all material respects and do not contain, or will not contain,
when delivered, any untrue statement or a material fact or omit to state a
material fact the omission of which would be misleading to Coyote Oil or the
shareholders of Coyote Oil in connection with this Plan.
3.15 Title and Related Matters. Suncrest has good and marketable title
to all of its properties, interests in properties, and assets, real and
personal, which are reflected, or will be reflected, in the Suncrest balance
sheets, free and clear of any encumbrances.
3.16 Contracts or Agreements. Suncrest is not bound by any material
contracts, agreements or obligations which it has not already disclosed to
Coyote Oil in writing.
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3.17 Governmental Authorizations. Suncrest has all licenses, permits
and other government authorizations that are legally required to enable it to
conduct its business in all material respects as conducted on the date hereof.
Except for compliance with federal and state securities laws, no
authorization, approval, consent or order of, or registration, declaration, or
filing with, any court or other governmental body is required in connection
with the execution and delivery by Suncrest of this Plan and the consummation
by Coyote Oil of the transactions contemplated hereby.
3.18 Compliance with Laws and Regulations. Suncrest has complied with
all applicable statutes and regulations of any federal, state, or other
applicable jurisdiction or agency thereof, except to the extent that
noncompliance would not materially and adversely affect the business,
operations, properties, assets, or condition of Suncrest or except to the
extent that noncompliance would incur any material liability, not otherwise
disclosed to Coyote Oil.
3.19 Approval of Plan. The Board of Directors of Suncrest has
authorized the execution and delivery of this Plan by Suncrest and have
approved the Plan and the transactions contemplated hereby. Suncrest has full
power, authority, and legal right to enter into this Plan and to consummate
the transactions contemplated hereby.
3.20 Investment Intent. Suncrest is acquiring the Coyote Oil Shares to
be transferred to it under this Plan for investment and not with a view to the
sale or distribution thereof, and Suncrest has no commitment or present
intention to liquidate Coyote Oil or to sell or otherwise dispose of the
Coyote Oil Shares.
3.21 Unregistered Shares and Access to Information. Suncrest
understands that the offer and sale of the Coyote Oil Shares have not been
registered with or reviewed by the Securities and Exchange Commission under
the Securities Act of 1933, as amended, or with or by any state securities law
administrator, and no federal, state securities law administrator has reviewed
or approved any disclosure or other material concerning Coyote Oil or the
Coyote Oil Shares. Suncrest has been provided with and reviewed all
information concerning Coyote Oil, the Coyote Oil Shares as it has considered
necessary or appropriate as a prudent and knowledgeable investor to enable it
to make an informed investment decision concerning the Coyote Oil Shares.
Suncrest has made an investigation as to the merits and risks of its
acquisition of the Coyote Oil Shares and has had the opportunity to ask
questions of, and has received satisfactory answers from, the officers and
directors of Coyote Oil concerning Coyote Oil, the Coyote Oil Shares and
related matters, and has had an opportunity to obtain additional information
necessary to verify the accuracy of such information and to evaluate the
merits and risks of the proposed acquisition of the Coyote Oil Shares.
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3.22 Suncrest Schedules. Suncrest has delivered to Coyote Oil the
following items pertaining to Suncrest, listed below, hereafter referred to as
the "Suncrest Schedules", which is hereby incorporated by reference and made a
part hereof. A certification has been executed by a duly authorized officer
of Suncrest on or about the date which the Plan is executed to certify that
the Suncrest Schedules are true and correct.
(a) Copy of Articles of Incorporation and any amendments, and
Bylaws;
(b) Financial statements;
(c) Shareholder list;
(d) Resolutions of Directors approving Plan;
(e) Officers' Certificate as required under Section 6.2 of the
Plan;
Section 4
Representations, Warranties and Covenants of Coyote Oil
Coyote Oil Company, Inc. represents and warrants to, and covenants with,
the Shareholders and Suncrest as follows:
4.1 Corporate Status. Coyote Oil is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada
incorporated on July 6, 1996. Coyote Oil has full corporate power and is duly
authorized, qualified, franchised, and licensed under all applicable laws,
regulations, ordinances, and orders of public authorities to own all of its
properties and assets and to carry on its business on all material respects as
it is now being conducted. Included in the Coyote Oil schedules (defined
below) are complete and correct copies of its Articles of Incorporation and
Bylaws as in effect on the date hereof. The execution and delivery of this
Plan does not, and the consummation of the transactions contemplated hereby
will not, violate any provision of Coyote Oil's Articles of Incorporation or
Bylaws. Coyote Oil has taken all action required by law, its Articles of
Incorporation, its Bylaws, or otherwise, to authorize the execution and
delivery of this Plan.
4.2 Capitalization. The authorized capital stock of Coyote Oil as of
the date hereof consists of 20,000,000 common shares, $.001 par value. As of
the date hereof there are 10,000,000 common shares of Coyote Oil issued and
outstanding. The issued and outstanding common shares of Coyote Oil are
fully paid, non-assessable shares. There are no outstanding options,
warrants, obligations convertible into shares of stock, or calls or any
understanding, agreements, commitments, contracts or promises with respect to
the issuance of Coyote Oil's common stock.
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4.3 Undisclosed Liabilities. Coyote Oil has no liabilities or
obligations which are material, individually or in the aggregate, that have
not been disclosed in writing to Suncrest, other than those put forth in
Coyote Oil's financial statements or as incurred in the ordinary course of
Coyote Oil's business, and Coyote Oil expressly warrants to Suncrest that it
has no liabilities or obligations either vested or contingent to its
management of employees for payment of benefits or compensation of any type or
manner.
4.4 Indemnification. Coyote Oil agrees to indemnify and hold Suncrest
and its shareholders harmless against any losses, claims, damages or
liabilities, joint or several (which shall, for all purposes of this
Agreement, include, but not be limited to all costs of defense and
investigation and all attorney's fees), relating to, concerning or in any way
arising from any and all undisclosed material obligations or liabilities of
Coyote Oil. This indemnity agreement shall be in addition to any liability
which Coyote Oil may otherwise have to Suncrest.
4.5 Conduct of Business. Coyote Oil will use its best efforts to
maintain and preserve its business organization, employee relationships and
goodwill intact, and will not, without the prior written consent of Suncrest,
enter into any material commitments except in the ordinary course of business.
Coyote Oil agrees that Coyote Oil will conduct itself in the following
manner pending the Closing:
(a) Certificate of Incorporation and Bylaws. No change will be
made in the Certificate of Incorporation or Bylaws of Coyote Oil.
(b) Capitalization, etc. Coyote Oil will not make any change in
its authorized or issued shares of any class, declare or pay any dividend or
other distribution, or issue, encumber, purchase or otherwise acquire any of
its shares of any class.
4.6 Title to Property. Coyote Oil has good and marketable title to
all of its properties and assets, real and personal, proprietary or otherwise,
as will be reflected in the balance sheets of Coyote Oil, and the properties
and assets of Coyote Oil are subject to no mortgage, pledge, lien or
encumbrance, unless as otherwise disclosed in its financial statements.
4.7 Litigation. There are no material actions, suits, or proceedings,
pending, or, to the best knowledge of Coyote Oil, threatened by or against or
affecting Coyote Oil at law or in equity, or before any governmental agency or
instrumentality, domestic or foreign, or before any arbitrator of any kind;
Coyote Oil does not have any knowledge of any default on its part with respect
to any judgment, order, writ, injunction, decree, warrant, rule, or regulation
of any court, arbitrator, or governmental agency or instrumentality.
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4.8 Books and Records. From the date hereof, and for any reasonable
period subsequent thereto, Coyote Oil and its present management will (I) give
to Suncrest, or their duly authorized representatives, full access, during
normal business hours, to all of its books, records, contracts and other
corporate documents and properties so that Suncrest, or their duly authorized
representatives, may inspect them; and (ii) furnish such information
concerning the properties and affairs of Coyote Oil as Suncrest, or their duly
authorized representatives, may reasonably request. Any such request to
inspect Coyote Oil's books shall be directed to Coyote Oil's representative,
at the address set forth herein under Section 10.4 Notices.
4.9 Confidentiality. Until the Closing (and thereafter if there is no
Closing), Coyote Oil and its representatives will keep confidential any
information which they obtain from Suncrest concerning its properties, assets
and the proposed business operations of Coyote Oil. If the terms and
conditions of this Plan imposed on the parties hereto are not consummated on
or before 5:00 p.m. MST on July 1, 2003 or otherwise waived or extended in
writing to a date mutually agreeable to the parties hereto, Coyote Oil will
return to Suncrest all written matter with regard to Suncrest obtained in
connection with the negotiations or consummation of this Plan.
4.10 Investment Intent. The Shareholders represent and covenant that
they are acquiring the unregistered and restricted common shares of Suncrest
to be delivered to them under this Plan for investment purposes and not with a
view to the subsequent sale or distribution thereof, and as agreed, supra, the
Shareholders, their successors and assigns agree to execute and deliver to
Suncrest on the date of Closing or no later than the date on which the
restricted shares are issued and delivered to the Shareholders, their assigns,
or designees, an Investment Letter similar in form to that attached hereto as
Exhibit B.
4.11 Vote Required. The affirmative vote of the holders of at least a
majority of the outstanding Coyote Oil Shares is the only vote of the holders
of any class or series of Coyote Oil's capital stock necessary to approve and
adopt this Plan.
4.12 Unregistered Shares and Access to Information. Coyote Oil and the
Shareholders understand that the offer and sale of Suncrest shares to be
exchanged for the Coyote Oil Shares have not been registered with or reviewed
by the securities and Exchange Commission under the Securities Act of 1933, as
amended, or with or by any state securities law administrator, and no federal
or state securities law administrator has reviewed or approved any disclosure
or other material facts concerning Suncrest or Suncrest stock. Coyote Oil and
the Shareholders have been provided with and reviewed all information
concerning Suncrest and Suncrest shares, to be exchanged for the Coyote Oil
Shares as they have considered necessary or appropriate as prudent and
knowledgeable investors to enable them to make informed investment decisions
concerning the Suncrest shares, to be exchanged for the Coyote Oil Shares.
Coyote Oil and the Shareholders have made an investigation as to the merits
and risks of their acquisition of the Suncrest shares, to be exchanged for the
Coyote Oil Shares and have had the opportunity to ask questions of, and have
received satisfactory answers from, the officers and directors of Suncrest
concerning Suncrest shares to be exchanged for the Coyote Oil Shares and
related matters, and have had an opportunity to obtain additional information
necessary to verify the accuracy of such information and to evaluate the
merits and risks of the proposed acquisition of the Suncrest shares to be
exchanged for the Coyote Oil Shares.
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4.13 Title to Shares. The Shareholders are the beneficial and record
owners, free and clear of any liens and encumbrances, of whatever kind or
nature, of all of the Coyote Oil Shares of whatever class or series, which the
Shareholders have contracted to exchange under this Agreement.
4.14 Contracts.
(a) Except for the contracts set forth in the Coyote Oil
Schedules, Coyote Oil is not a party to any other license agreements, material
contracts, written or oral, nor is Coyote Oil a party to any franchise
agreements or other commitments.
(b) Except as may be set forth in the Coyote Oil Schedules,
Coyote Oil is not a party to any contract, agreement, corporate restriction,
or subject to any judgment, order, writ, injunction, decree, or award, which
materially and adversely affect the business, operations, properties, assets,
or conditions of Coyote Oil.
(c) Except as set forth in the Coyote Oil Schedules, Coyote Oil
is not a party to any material oral or written (I) contract for employment of
any officer which is not terminable on 30 days (or less) notice; (ii) profit
sharing, bonus, deferred compensation, stock option, severance, or any other
retirement plan or arrangement covered by Title IV of the Employee Retirement
Income Security Act, as amended, or otherwise covered; (iii) agreement
providing for the sale, assignment or transfer of any of its rights, assets or
properties, whether tangible or intangible, except sales of its property in
the ordinary course of business with a value of less than $10,000; or (iv)
waiver of any right of any value which in the aggregate is extraordinary or
material concerning the assets or properties scheduled by Coyote Oil, except
for adequate value and pursuant to contract. Coyote Oil has not entered into
any material transaction which is not listed in the Coyote Oil Schedules or
reflected in the Coyote Oil financial statements.
4.15 Material Contract Defaults. Coyote Oil is not in default in any
material respect under the terms of any contract, agreement, lease or other
commitment which is material to the business, operations, properties or
assets, or condition of Coyote Oil, and there is no event of default or event
which, with notice or lapse of time or both, would constitute a default in any
material respect under any such contract, agreement, lease, or other
commitment in respect of which Coyote Oil has not taken adequate steps to
prevent such default from occurring, or otherwise compromised, reached a
satisfaction of, or provided for extensions of time in which to perform under
any one or more contract obligations, among others.
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4.16 Conflict with Other Instruments. The consummation of the within
transactions will not result in the breach of any term or provision of, or
constitute a default under any indenture, mortgage, deed of trust, or other
material agreement or instrument to which Coyote Oil was or is a party, or to
which any of its assets or operations are subject, and will not conflict with
any provision of the Articles of Incorporation or Bylaws of Coyote Oil.
4.17 Governmental Authorizations. Coyote Oil is in good standing in the
State of Nevada. Except for compliance with federal and state securities laws,
no authorization, approval, consent or order of, or registration, declaration,
or filing with, any court or other governmental body is required in connection
with the execution and delivery by Coyote Oil of this Plan and the
consummation by Coyote Oil of the transactions contemplated hereby.
4.18 Compliance with Laws and Regulations. Coyote Oil has complied
with all applicable statutes and regulations of any federal, state, or other
applicable jurisdiction or agency thereof, except to the extent that
noncompliance would not materially and adversely affect the business,
operations, properties, assets, or condition of Coyote Oil or except to the
extent that noncompliance would incur any material liability, not otherwise
disclosed to Suncrest.
4.19 Approval of Plan. The Board of Directors of Coyote Oil have
authorized the execution and delivery of this Plan by Coyote Oil and have
approved the Plan and the transactions contemplated hereby. Coyote Oil has
full power, authority, and legal right to enter into this Plan and to
consummate the transactions contemplated hereby.
4.20 Information. The information concerning Coyote Oil set forth in
this Plan, and the Coyote Oil Schedules attached hereto, are complete and
accurate in all material respects and do not contain, or will not contain,
when delivered, any untrue statement of a material fact or omit to state a
material fact the omission of which would be misleading to Suncrest in
connection with this Plan.
4.21 Coyote Oil Schedules. Coyote Oil has delivered to Suncrest the
following items listed below, hereafter referred to as the "Coyote Oil
Schedules", which is hereby incorporated by reference and made a part hereof.
A certification has been executed by a duly authorized officer of Coyote Oil
on or about the date which the Plan is executed to certify that the Coyote Oil
Schedules are true and correct.
(a) Copy of Articles of Incorporation and Bylaws
(b) Financial Statements
(c) A schedule setting forth the shareholders, together with
the number of shares owned beneficially or of record by each (also attached as
Exhibit A)
(d) Resolutions of Board of Directors approving Plan
(e) Consent of Shareholders approving Plan
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Section 5
Special Covenants
5.1 Coyote Oil Information Incorporated in Suncrest's Reports. Coyote
Oil represents and warrants to Suncrest that all the information furnished
under this Plan shall be true and correct in all material respects and that
there is no omission of any material fact required to make the information
stated not misleading. Coyote Oil agrees to indemnify and hold Suncrest
harmless, including each of its Directors and Officers, and each person, if
any, who controls such party, under any applicable law from and against any
and all losses, claims, damages, expenses or liabilities to which any of them
may become subject under applicable law, or reimburse them for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such actions insofar as such losses, claims, damages, expenses,
liabilities or actions arise out of or are based on any untrue statement,
intentional untrue statement, or intentional omission of a material fact
contained in such information delivered hereunder. This indemnity shall only
survive as long as specified within this agreement.
5.2 Special Covenants and Representations Regarding the Exchanged
Suncrest Stock. The consummation of this Plan and the transactions herein
contemplated, including the issuance of the Suncrest shares in exchange for
all of the issued and outstanding shares of Coyote Oil to the Shareholders
constitutes the offer and sale of securities under the Securities Act and the
applicable state statutes, which depend, inter alia, on the circumstances
under which the Shareholders acquire such securities. Suncrest intends to
rely on the exemption of the registration provision of Section 5 of the
Securities Act as provided for under Section 4 (2) of the Securities Act of
1933, which states "transactions not involving a public offering", among
others. Each Shareholder upon submission of his Coyote Oil Shares and the
receipt of the Suncrest post-split shares exchanged therefor, shall execute
and deliver to Suncrest a letter of investment intent to indicate, among other
representations, that the Shareholder is exchanging the Coyote Oil Shares for
Suncrest post-split shares for investment purposes and not with a view to the
subsequent distribution thereof. A proposed Investment Letter is attached
hereto as Exhibit B and incorporated herein by reference for the general use
by the Shareholders, as they may determine.
5.3 Action Prior to Closing. Upon the execution hereof until the
Closing date, and the completion of the consolidated audited financial
statements:
(a) Coyote Oil and Suncrest will (I) perform all of its
obligations under material contracts, leases, insurance policies and/or
documents relating to its assets and business; (ii) use its best efforts to
maintain and preserve its business organization intact, to retain its key
employees, and to maintain its relationship with existing potential customers
and clients; and (iii) fully comply with and perform in all material respects
all duties and obligations imposed on it by all federal and state laws and all
rules, regulations, and orders imposed by all federal or state governmental
authorities.
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(b) Neither Coyote Oil nor Suncrest will (I) make any change in
its Articles of Incorporation or Bylaws except and unless as contemplated
pursuant to Section 3 of this Plan; (ii) enter into or amend any contract,
agreement, or other instrument of the types described in the parties'
schedules, except that a party may enter into or amend any contract or other
instrument in the ordinary course of business involving the sale of goods or
services, provided that such contract does not involve obligations in excess
of $10,000.
Section 6
Conditions Precedent to Obligations of
Coyote Oil and the Shareholders
All obligations of Coyote Oil and the Shareholders under this Plan are
subject to the satisfaction, on or before the Closing date, except as
otherwise provided for herein, or waived or extended in writing by the parties
hereto, of the following conditions:
6.1 Accuracy of Representations. The representations and warranties
made by Suncrest in this Plan were true when made and shall be true as of the
Closing date (except for changes therein permitted by this Plan) and have the
same force and effect as if such representations and warranties were made at
and as of the Closing date; and, Coyote Oil shall have performed and complied
with the terms and conditions of this Plan prior to the Closing. Coyote Oil
and its shareholders shall have been furnished with a certificate, signed by a
duly authorized executive officer of Suncrest and dated the Closing date, to
the foregoing effect.
6.2 Officers' Certificate. Coyote Oil and the Shareholders shall have
been furnished with a certificate dated the Closing date and signed by a duly
authorized executive officer of Suncrest, to the effect that no litigation,
proceeding, investigation, or inquiry is pending, or to the best knowledge of
Suncrest, threatened, which might result in an action to enjoin or prevent the
consummation of the transactions contemplated by this Plan, or which might
result in any material adverse change in the assets, properties, business, or
operations of Suncrest.
6.3 No Material Adverse Change. Prior to the Closing date, there shall
have not occurred any material adverse change in the condition, business or
operations of Suncrest, nor shall any event have occurred which, with lapse of
time or the giving of notice or both, may cause or create any material adverse
change in the financial condition, business or operations of Suncrest, except
as otherwise disclosed to Coyote Oil.
6.4 Opinion of Counsel of Suncrest. Suncrest shall furnish to Coyote
Oil and the Shareholders an opinion dated as of the Closing date and in form
and substance satisfactory to Coyote Oil and the Shareholders to the effect
that:
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(a) Suncrest is a corporation duly organized, validly existing,
and in good standing under the laws of the State of Nevada, and with all
requisite corporate power to perform its obligations under this Plan.
(b) The business of Suncrest, as presently conducted, including,
upon the consummation hereof, the ownership of all of the issued and
outstanding shares of Coyote Oil, does not require it to register it to do
business as a foreign corporation in any jurisdiction other than under the
jurisdiction of its Articles of Incorporation or Bylaws and Suncrest has
complied to the best of its knowledge in all material respects with all the
laws, regulations, licensing requirements and orders applicable to its
business activities and has filed with the proper authorities, including the
Department of Commerce, Division of Corporations, and Secretary of State for
the State of Nevada, all statements and reports required to be filed.
(c) To the best knowledge of such counsel, the authorized and
outstanding capital stock of Suncrest as set forth in Section 3.2 above, and
all issued and outstanding shares have been duly and validly authorized and
issued and are fully paid and non-assessable.
(d) There are no material claims, suits or other legal
proceedings pending or threatened against Suncrest in any court or before or
by any governmental body which might materially affect the business of
Suncrest or the financial condition of Suncrest as a whole and no such claims,
suits or legal proceedings are contemplated by governmental authorities
against Suncrest.
(e) To the best knowledge of such counsel, the consummation of
the transactions contemplated by this Plan will not violate or contravene the
provisions of the Articles of Incorporation or Bylaws of Suncrest, or any
contract, agreement, indenture, mortgage, or order by which Suncrest is bound.
(f) This Plan constitutes a legal, valid and binding obligation
of Suncrest enforceable in accordance with its terms, subject to the affect of
any bankruptcy, insolvency, reorganization, moratorium, or similar law
affecting creditors' rights generally and general principles of equity.
(g) The execution and delivery of this Plan and the consummation
of the transactions contemplated hereby have been ratified by a majority of
the Shareholders of Suncrest and have been duly authorized by its Board of
Directors.
(h) Suncrest has not, nor will it undertake any action, the
result of which would endanger the tax-free nature of the Plan.
6.5 Other Items. Coyote Oil and the Shareholders shall have received
such further documents, certifications or instruments relating to the
transactions contemplated hereby as Coyote Oil and the Shareholders may
reasonably request.
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Section 7
Conditions Precedent to Obligations of Suncrest
All obligations of Suncrest under this Plan are subject, at its option,
to the fulfillment, before the Closing, of each of the following conditions:
7.1 Accuracy of Representations. The representations and warranties
made by Coyote Oil and the Shareholders under this Plan were true when made
and shall be true as of the Closing date (except for changes therein permitted
by this Plan) and have the same force and effect as if such representations
and warranties were made at and as of the Closing date; and Suncrest shall
have performed and complied with the terms and conditions of this Plan prior
to the Closing, unless waived or extended in writing by the parties hereto.
Coyote Oil and its shareholders shall have been furnished with a certificate,
signed by a duly authorized executive officer of Coyote Oil and dated the
Closing date, to the foregoing effect.
7.2 Officers' Certificate. Suncrest shall have been furnished with a
certificate dated the Closing date and signed by a duly authorized executive
officer of Coyote Oil, to the effect that no litigation, proceeding,
investigation, or inquiry is pending, or to the best knowledge of Coyote Oil,
threatened, which might result in an action to enjoin or prevent the
consummation of the transactions contemplated by this Plan, or which might
result in any material adverse change in the assets, properties, business, or
operations of Coyote Oil.
7.3 No Material Adverse Change. Prior to the Closing date, there shall
have not occurred any material adverse change in the final condition, business
or operations of Suncrest, nor shall any event have occurred which, with lapse
of time or the giving of notice or both, may cause or create any material
adverse change in the financial condition, business or operations of Coyote
Oil, except as otherwise disclosed to Suncrest.
7.4 Other Items. Suncrest shall have received such further documents,
certifications or instruments relating to the transactions contemplated hereby
as Suncrest may reasonably request.
7.5 Execution of Investment Letter. The Shareholders shall have
executed and delivered copies of Exhibit B to Suncrest.
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Section 8
Termination
8.1 Termination by Coyote Oil or the Shareholders. This Plan may be
terminated at any time prior to the Closing date by action of Coyote Oil or
the Shareholders, if Suncrest shall fail to comply in any material respect
with any of the covenants or agreements contained in this Plan, or if any of
its representations and warranties contained herein shall be inaccurate in any
material respect.
8.2 Termination by Suncrest. This Plan may be terminated at any time
prior to the Closing date by action of Suncrest if Coyote Oil shall fail to
comply in any material respect with any of the covenants or agreements
contained in this Plan, or if any of its representations or warranties
contained herein shall be inaccurate in any material respect.
8.3 Termination by Mutual Consent
(a) This Plan may be terminated at any time prior to the Closing
date by mutual consent of Suncrest, expressed by action of its Board of
Directors, Coyote Oil or the Shareholders.
(b) If this Plan is terminated pursuant to Section 8, this Plan
shall be of no further force and effect and no obligation, right or liability
shall arise hereunder. Each party shall bare its own costs in connection
herewith.
(c) If the Plan is terminated pursuant to Section 8, the parties
hereto shall sign non-disclosure agreements which shall survive the
cancellation of the Plan.
Section 9
Shareholders' Representative
The Shareholders hereby irrevocably designate and appoint Xxxx Xxxxxx as
their agent and attorney in fact (the "Shareholders' Representative") with
full power and authority until the Closing to execute, deliver and receive on
their behalf all notices, requests and other communications hereunder; to fix
and alter on their behalf the date, time and place of the Closing; to waive,
amend or modify any provisions of this Plan and to take such other action on
their behalf in connection with this Plan, the Closing and the transactions
contemplated hereby as such agent deems appropriate; provided, however, that
no such waiver, amendment or modification may be made if it would decrease the
number of shares to be issued to the Shareholders under Section 1 hereof or
increase the extent of their obligation to Suncrest hereunder, unless agreed
in writing by the Shareholders.
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Section 10
General Provisions
10.1 Further Assurances. At any time after the Closing date, each
party will execute and deliver such additional instruments and take such
action as may be reasonably requested by the other party to confirm or perfect
title to any property transferred hereunder or otherwise to carry out the
intent and purposes of the Plan.
10.2 Payments of Estimated Costs and Fees. Suncrest and Coyote Oil
mutually determine and agree that Suncrest shall pay the actual costs and fees
incurred by any party hereto in connection with the execution and consummation
of the Plan.
10.3 Press Release and Shareholders' Communications. On the date of
Closing, or as soon thereafter as practicable, Coyote Oil and the Shareholders
shall cause to have promptly prepared and disseminated a news release
concerning the execution and consummation of the Plan, such press release and
communication to be released promptly and within the time required by the
laws, rules and regulations as promulgated by the United States Securities and
Exchange Commission, and concomitant therewith to cause to be prepared a full
and complete letter to Suncrest's shareholders which shall contain information
required by Regulation 240.14f-1 as promulgated under Section 14(f) as
mandated under the Securities and Exchange Act of 1934, as amended.
10.4 Notices. All notices and other communications required or
permitted hereunder shall be sufficiently given if personally delivered, sent
by registered mail, or certified mail, return receipt requested, postage
prepaid, or by facsimile transmission addressed to the following parties
hereto or at such other addresses as follows:
If to Suncrest: Suncrest Global Energy Corp.
0000 Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
Fax: 000-000-0000
If to Coyote Oil (InCoyote Oil) or Coyote Oil Corporation
shareholder of Coyote Oil: 000 Xxxxx 000 Xxxx
Xxxx Xxxx Xxxx, Xxxx 00000
or at such other addresses as shall be furnished in writing by any party in
the manner for giving notices hereunder, and any such notice or communication
shall be deemed to have been given as of the date so delivered, mailed, sent
by facsimile transmission, or telegraphed.
10.5 Entire Agreement. This Plan represents the entire agreement
between the parties relating to the subject matter hereof, including any
previous letters of intent, understandings, or agreements between Suncrest,
Coyote Oil and the Shareholders with respect to the subject matter hereof, all
of which are hereby merged into this Plan, which alone fully and completely
expresses the agreement of the parties relating to the subject matter hereof.
Excepting the foregoing agreement, there are no other courses of dealing,
understandings, agreements, representations, or warranties, written or oral,
except as set forth herein with respect to the subject matter hereof.
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10.6 Governing Law. This Plan shall be governed by and construed and
enforced in accordance with the laws of the State of Nevada, except to the
extent preempted by federal law, in which event (and to that extent only)
federal law shall govern.
10.7 Tax Treatment. The transaction contemplated by this Plan is
intended to qualify as a "tax-free" reorganization under the provisions of
Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended. Coyote
Oil and Suncrest acknowledge, however, that each are being represented by
their own tax advisors in connection with this transaction, and neither has
made any representations or warranties to the other with respect to treatment
of such transaction or any part or effect thereof under applicable tax laws,
regulations or interpretations; and no attorney's opinion or tax revenue
ruling has been obtained with respect to the tax consequences of the
transactions contemplated by the within Plan.
10.8 Amendment of Waiver. Every right and remedy provided herein shall
be cumulative with every other right and remedy, whether conferred herein, at
law or in equity, and may be enforced concurrently or separately, and no
waiver by any party of the performance of any obligation by the other shall be
construed as a waiver of the same or any other default then, therefore, or
thereafter occurring or existing. Any time prior to the expiration of thirty
(30) days from the date hereof, this Plan may be amended in writing signed by
all parties hereto, with respect to any of the terms contained herein, and any
term or condition of this Plan may be waived or the time for performance
thereof may be extended by a writing signed by the party or parties for whose
benefit the provision is intended.
10.9 Counterparts. This Plan may be executed in any number of
counterparts, each of which when executed and delivered shall be deemed to be
an original, and all of which together shall constitute one and the same
instruments.
10.10 Headings. The section and subsection headings in this Plan are
inserted for convenience only and shall not effect in any way the meaning or
interpretation of the Plan.
10.11 Parties in Interest. Except as may be otherwise expressly
provided herein, all terms and provisions of this Plan shall be binding upon
and inure to the benefit of the parties hereto and their respective heirs,
beneficiaries, personal and legal representatives, and assigns.
IN WITNESS WHEREOF, the parties have executed this Plan and Agreement of
Reorganization effective the day and year first set forth above.
[The remainder of this page was intentionally left blank]
[Signature page to follow]
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Suncrest Global Energy Corp.
Attest:
/s/ Xxxxx Xxxxxx /s/ Xxxxxx Xxxx
_____________________ By: _________________________
Its President - Xxxxxx Xxxx
Coyote Oil Company, Inc.
Attest:
/s/ Xxxxx Xxxxxx /s/ Xxxx Xxxxxx
_____________________ By: _________________________
Its President - Xxxx Xxxxxx
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SHAREHOLDERS:
Attest:
_____________________ By: __________________________
Attest:
_____________________ By: __________________________
Attest:
_____________________ By: __________________________
Attest:
_____________________ By: __________________________
Attest:
_____________________ By: __________________________
Attest:
_____________________ By: __________________________
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