EXHIBIT 2.1
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT (hereinafter referred to as this "Agreement"), is
entered into as of this 22nd day of April 1999, by and among Norske Energy
Corp., a Delaware corporation ("Norske"), Synoptech Solutions Group, Inc., a
Nevada corporation ("Synoptech"), those persons identified in Schedule A-1
attached hereto who are the beneficial owners of 6,596,342 shares of common
stock of Synoptech ("Common Stock"), which constitutes 100% of the outstanding
capital stock of Synoptech ("Synoptech Shareholders"), those persons identified
in Schedule A-2 attached hereto who are the holders of Synoptech Common Stock
purchase warrants ("Warrants") having the right to purchase a total of 2,546,999
shares of Synoptech Common Stock, and those persons identified in Schedule A-3
attached hereto who are the holders of Synoptech Common Stock purchase options
("Options") having the right to purchase a total of 110,000 shares of Synoptech
Common Stock.
PREMISES
This Agreement provides for the acquisition by Norske of all of the issued
and outstanding shares of Synoptech solely in exchange for voting shares of
Norske, on the terms and conditions hereinafter provided, all for the purpose of
effecting a so-called "tax-free" reorganization pursuant to Sections
368(a)(1)(B) of the Internal Revenue Code of 1954, as amended.
AGREEMENT
NOW THEREFORE, on the stated premises and for and in consideration of the
mutual covenants and agreements hereinafter set forth and the mutual benefits to
the parties to be derived herefrom, it is hereby agreed as follows:
ARTICLE I
REPRESENTATIONS, COVENANTS, AND WARRANTIES
OF NORSKE
As an inducement to, and to obtain the reliance of the Synoptech
Shareholders, Norske represents and warrants as follows:
Section 1.01 ORGANIZATION. Norske is a corporation duly organized,
validly existing, and in good standing under the laws of the state of Delaware.
Norske has the 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 in all material respects as it is now being conducted, including
qualification to do business as a foreign corporation in the states 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 Schedule 1.01 are complete
and correct copies of the certificate of incorporation, as amended, and bylaws
of Norske as in effect on the date hereof. The execution and delivery of this
Agreement do not, and the consummation of the transactions contemplated by this
Agreement in accordance with the terms hereof will not, violate any provision of
the certificate of incorporation or bylaws. Norske has taken all action
required by laws, its articles of incorporation, its bylaws, or otherwise to
authorize the execution and delivery of this Agreement. Norske has full power,
authority, and legal right and has taken all action required by law, its
certificate of incorporation, bylaws, and otherwise to consummate the
transactions herein contemplated.
Section 1.02 CAPITALIZATION. The authorized capitalization of Norske
consists of 50,000,000 shares of common stock, $.001 par value per share, of
which 6,307,358 shares are currently issued and outstanding. A shareholder list
is set forth in Schedule 1.02. All issued and outstanding shares are legally
issued, fully paid, and non-assessable and not issued in violation of the pre-
emptive or other rights of any person. There are no options, warrants, rights
or convertible securities outstanding to purchase any capital stock of Norske,
except as set forth in Schedule 1.02.
Section 1.03 SUBSIDIARIES AND PREDECESSOR CORPORATIONS. Norske does not
have any subsidiaries and does not own, beneficially or of record, any shares of
any other corporation.
Section 1.04 FINANCIAL STATEMENTS.
(a) Included in Schedule 1.04(a) are the unaudited financial
statements of Norske for each of its last two fiscal years ended March 31,
1999.
(b) All such financial statements have been prepared in accordance
with generally accepted accounting principles. The audited balance sheet
presents fairly as of its date the financial condition of Norske. Norske
did not have, as of the date of such balance sheet, except as and to the
extent reflected or reserved against therein, any liabilities or
obligations (absolute or contingent) which should be reflected in a balance
sheet or the notes thereto, prepared in accordance with generally accepted
accounting principles, and all assets reflected therein are properly
reported and present fairly the value of the assets of Norske in accordance
with generally accepted accounting principles. The statements of income,
stockholders' equity, and changes in financial condition reflect fairly the
information required to be set forth therein by generally accepted
accounting principles.
(c) Norske has not filed any state, federal, or local income tax
returns required to be filed by it from inception to the date hereof.
Norske does not owe any federal, state, county, local, or other taxes
(including any deficiencies, interest, or penalties) through the date
hereof, for which Norske may be liable in its own right or as a transferee
of the assets of, or as a successor to, any other corporation or entity.
Furthermore, except as accruing in the normal course of business, Norske
does not owe any accrued and unpaid taxes to date of this Agreement.
(d) The books and records, financial and otherwise, of Norske are in
all material respects complete and correct and have been maintained in
accordance with good business and accounting practices.
(e) Norske has good and marketable title to its assets and, except as
set forth in the financial statements of Norske or the notes thereto, have
no material contingent liabilities, direct or indirect, matured or
unmatured.
Section 1.05 INFORMATION. The information concerning Norske set forth in
this Agreement and in Schedules attached hereto is complete and accurate in all
material respects and does not contain any untrue statement of a material fact
or omit to state a material fact required to make the statements made, in light
of the circumstances under which they were made, not misleading.
Section 1.06 OPTIONS OR WARRANTS. There are no existing options,
warrants, calls, or commitments of any character relating to the authorized and
unissued Norske Common Stock, except as described in Schedule 1.02.
Section 1.07 ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as set forth in
this Agreement, since March 31, 1999:
(a) there has not been (i) any material adverse change in the
business, operations, properties, assets, or condition of Norske; or (ii)
any damage, destruction, or loss to Norske (whether or not covered by
insurance) materially and adversely affecting the business, operations,
properties, assets, or condition of Norske;
(b) Norske has not (i) amended its certificate of incorporation or
bylaws; (ii) declared or made, or agreed to declare or make, any payment of
dividends or distributions of any assets of any kind whatsoever to
stockholders or purchased or redeemed, or agreed to purchase or redeem, any
of its capital stock; (iii) waived any rights of value which in the
aggregate are extraordinary or material considering the business of Norske;
(iv) made any material change in its method of management, operation, or
accounting; (v) entered into any other material transaction; (vi) made any
accrual or arrangement for payment of bonuses or special compensation of
any kind or any severance or termination pay to any present or former
officer or employee; (vii) increased the rate of compensation payable or to
become payable by it to any of its officers or directors or any of its
employees whose monthly compensation exceeds $1,000; or (viii) made any
increase in any profit sharing, bonus, deferred compensation, insurance,
pension, retirement, or other employee benefit plan, payment, or
arrangement made to, for, or with its officers, directors, or employees;
(c) Norske has not (i) borrowed or agreed to borrow any funds or
incurred, or become subject to, any material obligation or liability
(absolute or contingent); (ii) paid any material obligation or liability
(absolute or contingent) other than current liabilities reflected in or
shown on the most recent Norske balance sheet; (iii) sold or transferred,
or agreed to sell or transfer, any of its assets, properties, or rights
(except assets, properties, or rights not used or useful in its business
which, in the aggregate have a value of less than $1,000), or canceled, or
agreed to cancel, any debts or claims (except debts or claims which in the
aggregate are of a value of less than $1,000); (iv) made or permitted any
amendment or termination of any contract, agreement, or license to which it
is a party if such amendment or termination is material, considering the
business of Norske; or (v) except as reflected on Schedule 1.02, issued,
delivered, or agreed to issue or deliver any stock, bonds or other
corporate securities including debentures (whether authorized and unissued
or held as treasury stock); and
(d) to the best knowledge of the Norske Shareholder, Norske has not
become subject to any law or regulation which materially and adversely
affects, or in the future may adversely affect, the business, operations,
properties, assets, or condition of Norske.
Section 1.08 TITLE AND RELATED MATTERS. Norske has good and marketable
title to all of its properties, inventory, interests in properties, and assets,
real and personal, which are reflected in the most recent balance sheet or
acquired after that date (except properties, interests in properties, and assets
sold or otherwise disposed of since such date in the ordinary course of
business), free and clear of all liens, pledges, charges, or encumbrances except
(a) statutory liens or claims not yet delinquent; and (b) such imperfections of
title and easements as do not and will not materially detract from or interfere
with the present or proposed use of the properties subject thereto or affected
thereby or otherwise materially impair present business operations on such
properties. Norske owns, free and clear of any liens, claims, encumbrances,
royalty interests, or other restrictions or limitations of any nature
whatsoever, any and all products it is currently manufacturing, including the
underlying technology and data, and all procedures, techniques, marketing plans,
business plans, methods of management, or other information utilized in
connection with Norske's business. No third party has any right to, and Norske
has not received any notice of infringement of or conflict with asserted rights
of others with respect to any product, technology, data, trade secrets, know-
how, proprietary techniques, trademarks, service marks, tradenames, or
copyrights which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling, or finding, would have a materially adverse effect on the
business, operations, financial condition, income, or business prospects of
Norske or any material portion of its properties, assets, or rights.
Section 1.09 LITIGATION AND PROCEEDINGS. There are no actions, suits,
proceedings, or investigations pending or, to the knowledge of Norske after
reasonable investigation, threatened by or against Norske or affecting Norske or
its properties, at law or in equity, before any court or other governmental
agency or instrumentality, domestic or foreign, or before any arbitrator of any
kind. Norske does not have any knowledge of any default on its part with
respect to any judgment, order, writ, injunction, decree, award, rule, or
regulation of any court, arbitrator, or governmental agency or instrumentality
or of any circumstances which, after reasonable investigation, would result in
the discovery of such a default.
Section 1.10 CONTRACTS.
(a) Except for Media Communications, there are no material contracts,
agreements, franchises, license agreements, or other commitments to which
Norske is a party or by which it or any of its assets, products,
technology, or properties are bound;
(b) All contracts, agreements, franchises, license agreements, and
other commitments to which Norske is a party or by which its properties are
bound and which are material to the operations of Norske taken as a whole
are valid and enforceable by Norske in all respects, except as limited by
bankruptcy and insolvency laws and by other laws affecting the rights of
creditors generally;
(c) Norske is not a party to or bound by, and the properties of Norske
are not subject to, any contract, agreement, other commitment or
instrument; any charter or other corporate restriction; or any judgment,
order, writ, injunction, decree, or award which materially and adversely
affects, or in the future may (as far as Norske can now foresee) materially
and adversely affect, the business, operations, properties, assets, or
condition of Norske; and
(d) Norske is not a party to any oral or written (i) contract for the
employment of any officer or employee; (ii) profit sharing, bonus, deferred
compensation, stock option, severance pay, pension benefit or retirement
plan, agreement, or arrangement covered by Title IV of the Employee
Retirement Income Security Act, as amended; (iii) agreement, contract, or
indenture relating to the borrowing of money; (iv) guaranty of any
obligation, other than one on which Norske is a primary obligor, for the
borrowing of money or otherwise, excluding endorsements made for collection
and other guaranties of obligations, which, in the aggregate do not exceed
more than one year or providing for payments in excess of $1,000 in the
aggregate; (vi) collective bargaining agreement; (vii) agreement with any
present or former officer or director of Norske or (viii) contract,
agreement, or other commitment involving payments by it of more than $1,000
in the aggregate.
Section 1.11 MATERIAL CONTRACT DEFAULTS. Norske is not in default in any
material respect under the terms of any outstanding contract, agreement, lease,
or other commitment which is material to the business, operations, properties,
assets, or condition of Norske and there is no event of default in any material
respect under any such contract, agreement, lease, or other commitment in
respect of which Norske or the Norske Shareholder has not taken adequate steps
to prevent such a default from occurring.
Section 1.12 NO CONFLICT WITH OTHER INSTRUMENTS. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust, or other material contract, agreement, or instrument to which Norske is a
party or to which any of its properties or operations are subject.
Section 1.13 GOVERNMENTAL AUTHORIZATIONS. Norske has all licenses,
franchises, permits, and other governmental 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 and corporation laws, as hereinafter provided, 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 Norske of this Agreement and the consummation by
Norske of the transactions contemplated hereby.
Section 1.14 COMPLIANCE WITH LAWS AND REGULATIONS. Norske has complied
with all applicable statutes and regulations of any federal, state, or other
governmental entity or agency thereof, except to the extent that noncompliance
would not materially and adversely affect the business, operations, properties,
assets, or condition of Norske or except to the extent that noncompliance would
not result in the incurrence of any material liability for Norske.
Section 1.15 INSURANCE. All the insurable properties of Norske are
insured in their full replacement value against all risks customarily insured
against by persons operating similar properties in localities where such
properties are located and under valid and enforceable policies by insurers of
recognized responsibility. Such policy or policies containing substantially
equivalent coverage will be outstanding on the date of consummation of the
transactions contemplated by this Agreement.
Section 1.16 APPROVAL OF AGREEMENT. The board of directors of Norske has
authorized the execution and delivery of this Agreement and has approved the
transactions contemplated hereby, and approved the submission of this Agreement
and the transactions contemplated hereby to the shareholders of Norske for their
approval with the recommendation that the reorganization be accepted if it has
been deemed necessary.
Section 1.17 LABOR RELATIONS. Norske has not had a work stoppage
resulting from labor problems. To the knowledge of Norske, no union or other
collective bargaining organization is organizing or attempting to organize any
employee of Norske.
Section 1.18 NORSKE SCHEDULES. Norske has delivered to Synoptech a copy of
the board of directors' and shareholders' minutes (if applicable) of Norske
approving this transaction.
Section 1.19 STOCKHOLDERS' EQUITY. At Closing, there shall be at least
$700,000 of cash in Norske, no liabilities, and stockholders' equity of at least
$700,000.
ARTICLE II
REPRESENTATIONS, COVENANTS, AND WARRANTIES
OF SYNOPTECH'S SHAREHOLDERS
As an inducement to, and to obtain reliance of Norske, Synoptech
Shareholders represent and warrant as follows:
Section 2.01 OWNERSHIP OF SYNOPTECH SHARES. Each Synoptech Shareholder
hereby represents and warrants with respect to itself that it is the legal and
beneficial owner of the number of Synoptech shares set forth opposite its name
at the foot of this agreement, free and clear of any claims, charges, equities,
liens, security interests, and encumbrances whatsoever, and each such
shareholder has full right, power, and authority to transfer, assign, convey,
and deliver its Synoptech shares; and delivery of such shares at the closing
will convey to Norske good and marketable title to such shares free and clear of
any claims, charges, equities, liens, security interests, and encumbrances
whatsoever.
ARTICLE III
REPRESENTATIONS, COVENANTS, AND WARRANTIES
OF SYNOPTECH SOLUTIONS GROUP, INC.
As an inducement to, and to obtain the reliance of Norske, Synoptech
represents and warrants as follows:
Section 3.01 ORGANIZATION. Synoptech is a corporation duly organized,
validly existing, and in good standing under the laws of the state of Nevada.
Synoptech has the 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 in all material respects as it is now being conducted, including
qualification to do business as a foreign corporation in the states 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 Schedule 3.01 are complete
and correct copies of the articles of incorporation, as amended, and bylaws of
Synoptech as in effect on the date hereof. The execution and delivery of this
Agreement do not, and the consummation of the transactions contemplated by this
Agreement in accordance with the terms hereof will not, violate any provision of
these articles of incorporation or bylaws. Synoptech has taken all action
required by laws, its articles of incorporation, its bylaws, or otherwise to
authorize the execution and delivery of this Agreement. Synoptech has full
power, authority, and legal right and has taken all action required by law, its
certificate of incorporation, bylaws, and otherwise to consummate the
transactions herein contemplated.
Section 3.02 CAPITALIZATION. The authorized capitalization of Synoptech
consists of 20,000,000 shares of common stock, $.01 par value per share, of
which 6,596,342 shares are currently issued and outstanding, 2,546,999 shares
are reserved for issuance upon exercise of currently outstanding warrants with
exercise prices ranging from $.50 to $2.13 per share, and 110,000 shares are
reserved for issuance upon exercise of currently outstanding options with
exercise prices of $1.00 per share. A shareholder list, warrant list and option
list are set forth in Schedules X-0, X-0 and A-3. All issued and outstanding
shares are legally issued, fully paid, and non-assessable and not issued in
violation of the pre-emptive or other rights of any person. Except as set forth
in the Schedules, there are no other options, warrants, rights or convertible
securities outstanding to purchase any capital stock of Synoptech.
Section 3.03 SUBSIDIARIES AND PREDECESSOR CORPORATIONS. Other than the
ownership of Prime Net Corporation, Synoptech does not have any other
subsidiaries and does not own, beneficially or of record, any shares of any
other corporation.
Section 3.04 FINANCIAL STATEMENTS.
(a) Included in Schedule 3.04 (a) are unaudited financial statements
for each of the last two fiscal years ended December 31, 1998.
(b) All such financial statements have been prepared in accordance
with generally accepted accounting principles. The unaudited balance sheet
presents fairly as of its date the financial condition of Synoptech.
Synoptech did not have, as of the date of such balance sheet, except as and
to the extent reflected or reserved against therein, any liabilities or
obligations (absolute or contingent) which should be reflected in a balance
sheet or the notes thereto, prepared in accordance with generally accepted
accounting principles, and all assets reflected therein are properly
reported and present fairly the value of the assets of Synoptech in
accordance with generally accepted accounting principles. The statements
of income, stockholders' equity, and changes in financial condition reflect
fairly the information required to be set forth therein by generally
accepted accounting principles.
(c) Synoptech has filed all state, federal, and local income tax
returns required to be filed by it from inception to the date hereof.
Included in Schedule 3.04(b) are true and correct copies of the federal
income tax returns of Synoptech filed since 1996. None of such federal
income tax returns have been examined by the Internal Revenue Service.
Each of such income tax returns reflects the taxes due for the period
covered thereby, except for amounts which, in the aggregate, are
immaterial.
(d) Synoptech does not owe any unpaid federal, state, county, local,
or other taxes (including any deficiencies, interest, or penalties) through
the date hereof, for which Synoptech may be liable in its own right or as a
transferee of the assets of, or as a successor to, any other corporation or
entity. Furthermore, except as accruing in the normal course of business,
Synoptech does not owe any accrued and unpaid taxes to date of this
Agreement.
(e) The books and records, financial and otherwise, of Synoptech are
in all material respects complete and correct and have been maintained in
accordance with good business and accounting practices.
(f) Synoptech has good and marketable title to its assets and, except
as pledged in the ordinary course of business or as set forth in the
financial statements of Synoptech or the notes thereto, has no material
contingent liabilities, direct or indirect, matured or unmatured.
Section 3.05 INFORMATION. The information concerning Synoptech set forth
in this Agreement and in Schedules attached hereto is complete and accurate in
all material respects and does not contain any untrue statement of a material
fact or omit to state a material fact required to make the statements made, in
light of the circumstances under which they were made, not misleading.
Section 3.06 OPTIONS OR WARRANTS. Except the warrants and options
referred to in Section 3.02, there are no existing options, warrants, calls, or
commitments of any character relating to the authorized and unissued Synoptech
common stock.
Section 3.07 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since December 31,
1998:
(a) there has not been (i) any material adverse change in the
business, operations, properties, assets, or condition of Synoptech or (ii)
any damage, destruction, or loss to Synoptech (whether or not covered by
insurance) materially and adversely affecting the business, operations,
properties, assets, or condition of Synoptech;
(b) Synoptech has not (i) amended its articles of incorporation or
bylaws; (ii) declared or made, or agreed to declare or make, any payment of
dividends or distributions of any assets of any kind whatsoever to
stockholders or purchased or redeemed, or agreed to purchase or redeem, any
of its capital stock; (iii) waived any rights of value which in the
aggregate are extraordinary or material considering the business of
Synoptech; (iv) made any material change in its method of management,
operation, or accounting; (v) entered into any other material transaction;
(vi) made any accrual or arrangement for payment of bonuses or special
compensation of any kind or any severance or termination pay to any present
or former officer or employee; (vii) increased the rate of compensation
payable or to become payable by it to any of its officers or directors or
any of its employees whose monthly compensation exceeds $5,000; or (viii)
made any increase in any profit sharing, bonus, deferred compensation,
insurance, pension, retirement, or other employee benefit plan, payment, or
arrangement made to, for, or with its officers, directors, or employees;
(c) Synoptech has not (i) borrowed or agreed to borrow any funds or
incurred, or become subject to, any material obligation or liability
(absolute or contingent) except liabilities incurred in the ordinary course
of business; (ii) paid any material obligation or liability (absolute or
contingent) other than current liabilities reflected in or shown on the
most recent Synoptech balance sheet, and current liabilities incurred since
that date in the ordinary course of business; (iii) sold or transferred, or
agreed to sell or transfer, any of its assets, properties, or rights
(except assets, properties, or rights not used or useful in its business
which, in the aggregate have a value of less than $10,000), or canceled, or
agreed to cancel, any debts or claims (except debts or claims which in the
aggregate are of a value of less than $10,000); (iv) made or permitted any
amendment or termination of any contract, agreement, or license to which it
is a party if such amendment or termination is material, considering the
business of Synoptech; or (v) except as reflected in Schedule A-1, issued,
delivered, or agreed to issue or deliver any stock, bonds or other
corporate securities including debentures (whether authorized and unissued
or held as treasury stock); and
(d) to the best knowledge of Synoptech, Synoptech has not become
subject to any law or regulation which materially and adversely affects, or
in the future may adversely affect, the business, operations, properties,
assets, or condition of Synoptech.
Section 3.08 TITLE AND RELATED MATTERS. Synoptech has good and marketable
title to all of its properties, inventory, interests in properties, and assets,
real and personal, which are reflected in the most recent balance sheet or
acquired after that date (except properties, interests in properties, and assets
sold or otherwise disposed of since such date in the ordinary course of
business), free and clear of all liens, pledges, charges, or encumbrances except
(a) statutory liens or claims not yet delinquent; (b) such imperfections of
title and easements as do not and will not materially detract from or interfere
with the present or proposed use of the properties subject thereto or affected
thereby or otherwise materially impair present business operations on such
properties; and (c) except as pledged in the ordinary course of business.
Except as pledged in the ordinary course of business, Synoptech owns, free and
clear of any liens, claims, encumbrances, royalty interests, or other
restrictions or limitations of any nature whatsoever, any and all products it is
currently manufacturing, including the underlying technology and data, and all
procedures, techniques, marketing plans, business plans, methods of management,
or other information utilized in connection with Synoptech's business. No
third party has any right to, and Synoptech has not received any notice of
infringement of or conflict with asserted rights of others with respect to any
product, technology, data, trade secrets, know-how, proprietary techniques,
trademarks, service marks, tradenames, or copyrights which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling, or finding, would
have a materially adverse effect on the business, operations, financial
condition, income, or business prospects of Synoptech or any material portion of
its properties, assets, or rights.
Section 3.09 LITIGATION AND PROCEEDINGS. Except as set forth in Schedule
3.09, there are no actions, suits, proceedings, or investigations pending or, to
the knowledge of Synoptech after reasonable investigation, threatened by or
against Synoptech or affecting Synoptech or its properties, at law or in equity,
before any court or other governmental agency or instrumentality, domestic or
foreign, or before any arbitrator of any kind. Synoptech does not have any
knowledge of any default on its part with respect to any judgment, order, writ,
injunction, decree, award, rule, or regulation of any court, arbitrator, or
governmental agency or instrumentality or of any circumstances which, after
reasonable investigation, would result in the discovery of such a default.
Section 3.10 CONTRACTS.
(a) There are no material contracts, agreements, franchises, license
agreements, or other commitments to which Synoptech is a party or by which
it or any of its assets, products, technology, or properties are bound
outside of the ordinary course of business;
(b) All contracts, agreements, franchises, license agreements, and
other commitments to which Synoptech is a party or by which its properties
are bound and which are material to the operations of Synoptech taken as a
whole are valid and enforceable by Synoptech in all respects, except as
limited by bankruptcy and insolvency laws and by other laws affecting the
rights of creditors generally;
(c) Synoptech is not a party to or bound by, and the properties of
Synoptech are not subject to, any contract, agreement, other commitment or
instrument; any charter or other corporate restriction; or any judgment,
order, writ, injunction, decree, or award which materially and adversely
affects, or in the future may
(as far as Synoptech can now foresee) materially and adversely affect, the
business, operations, properties, assets, or condition of Synoptech; and
(d) Except as incurred in the ordinary course of business or reflected
in the most recent Synoptech balance sheet, Synoptech is not a party to any
oral or written (i) contract for the employment of any officer or employee
which is not terminable on 30 days or less notice; (ii) profit sharing,
bonus, deferred compensation, stock option, severance pay, pension benefit
or retirement plan, agreement, or arrangement covered by Title IV of the
Employee Retirement Income Security Act, as amended; (iii) agreement,
contract, or indenture relating to the borrowing of money; (iv) guaranty of
any obligation, other than one on which Synoptech is a primary obligor, for
the borrowing of money or otherwise, excluding endorsements made for
collection and other guaranties of obligations, which, in the aggregate do
not exceed more than one year or providing for payments in excess of
$10,000 in the aggregate; (vi) collective bargaining agreement; (vii)
agreement with any present or former officer or director of Synoptech or
(viii) contract, agreement, or other commitment involving payments by it of
more than $10,000 in the aggregate.
Section 3.11 MATERIAL CONTRACT DEFAULTS. Synoptech is not in default in
any material respect under the terms of any outstanding contract, agreement,
lease, or other commitment which is material to the business, operations,
properties, assets, or condition of Synoptech and there is no event of default
in any material respect under any such contract, agreement, lease, or other
commitment in respect of which Synoptech has not taken adequate steps to prevent
such a default from occurring.
Section 3.12 NO CONFLICT WITH OTHER INSTRUMENTS. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust, or other material contract, agreement, or instrument to which Synoptech
is a party or to which any of its properties or operations are subject.
Section 3.13 GOVERNMENTAL AUTHORIZATIONS. Synoptech has all licenses,
franchises, permits, and other governmental 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 and corporation laws, as hereinafter provided, 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 Synoptech of this Agreement and the consummation by
Synoptech of the transactions contemplated hereby.
Section 3.14 COMPLIANCE WITH LAWS AND REGULATIONS. Synoptech has complied
with all applicable statutes and regulations of any federal, state, or other
governmental entity or agency thereof, except to the extent that noncompliance
would not materially and adversely affect the business, operations, properties,
assets, or condition of Synoptech or except to the extent that noncompliance
would not result in the incurrence of any material liability for Synoptech.
Section 3.15 INSURANCE. All the insurable properties of Synoptech are
insured in their full replacement value against all risks customarily insured
against by persons operating similar properties in localities where such
properties are located and under valid and enforceable policies by insurers of
recognized responsibility. Such policy or policies containing substantially
equivalent coverage will be outstanding on the date of consummation of the
transactions contemplated by this Agreement.
Section 3.16 APPROVAL OF AGREEMENT. The board of directors of Synoptech
has authorized the execution and delivery of this Agreement and has approved the
transactions contemplated hereby.
Section 3.17 LABOR RELATIONS. Synoptech has not had a work stoppage
resulting from labor problems. To the knowledge of Synoptech, no union or other
collective bargaining organization is organizing or attempting to organize any
employee of Synoptech.
Section 3.18 SYNOPTECH SCHEDULES. Synoptech has delivered to Norske a
copy of the board of directors' minutes of Synoptech approving this transaction.
ARTICLE IV
PLAN OF EXCHANGE
Section 4.01 THE EXCHANGE. On the terms and subject to the conditions set
forth in this Agreement, on the Closing Date (as defined in Section 4.05), each
of the Synoptech Shareholders hereby agrees to assign, transfer, and deliver to
Norske, free and clear of all liens, pledges, encumbrances, charges,
restrictions, or known claims of any kind, nature, or description, the number of
shares of common stock of Synoptech set after his signature at the foot of this
Agreement, in the aggregate constituting all of the issued and outstanding
shares of common stock of Synoptech, or 6,596,342 shares, and Norske agrees to
acquire such shares on such date by issuing and delivering in exchange therefor
solely shares of Norske restricted common stock, par value $0.001, in the amount
of 4.08 shares of Norske for each outstanding share of Synoptech, or an
aggregate amount of approximately 26,913,074 shares of Norske common stock, or
approximately 81% of the outstanding shares of Norske common stock. At the
Closing, each of the Synoptech Shareholders shall, on surrender of his
certificate or certificates representing such Synoptech shares to the registrar
and transfer agent, be entitled to receive a certificate or certificates
evidencing shares of the Exchanged Norske Stock as provided herein. Upon the
consummation of the transaction contemplated herein, all shares of capital stock
of Synoptech shall be held by Norske.
Section 4.02 EXCHANGE OF WARRANTS AND OPTIONS. In addition to the
exchange of stock set forth herein, at the Closing Norske will issue warrants
and options to purchase shares of Norske Common Stock to the individuals as
described in Schedules A-2 and A-3.
Section 4.03 APPOINTMENT OF NEW DIRECTORS. In connection with the Closing
of the transactions contemplated by this Agreement, the existing directors of
Norske shall resign, seriatim, and shall appoint Xxxx Xxxxxxx Overstoltz and
Xxxxxxx X. Xxxxxx as directors to fill the vacancies created thereby, to serve
until the next annual stockholders' meeting of Norske and their successors shall
have been elected and qualified.
Section 4.04 CLOSING. The closing ("Closing") of the transactions
contemplated by this Agreement shall be on a date and at such time as the
parties may agree ("Closing Date"), no later than Monday, May 10, 1999 provided
that the covenants and conditions set forth in Articles V, VI and VII have been
satisfied. Such Closing shall take place at a mutually agreeable time and
place.
Section 4.05 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 and all certificates, opinions,
financial statements, schedules, agreements, resolutions, rulings, or other
instruments required by this Agreement to be so delivered at or prior to the
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 transactions contemplated hereby.
Section 4.06 POST CLOSING ADJUSTMENTS. Norske has agreed to provide
Synoptech and the Synoptech Shareholders certain indemnification, as more fully
described in Section 5.07. Norske hereby acknowledges and agrees that in the
event that Synoptech or Synoptech Shareholders are entitled to a claim of
indemnification, Synoptech on a pro-rata basis is entitled to, among pursuing
other legal rights and remedies, issue additional shares of Norske Common Stock
to the Synoptech Shareholders (as determined prior to Closing) and to the
exclusion of the Norske shareholders (as determined prior to Closing) in amounts
and determinations made by the then Board of Directors of Norske.
ARTICLE V
SPECIAL COVENANTS
Section 5.01 BOARD OF DIRECTORS ACTION BY NORSKE. Prior to the Closing,
the Board of Directors of Norske shall:
(a) effect the authorization and approval of this Agreement and the
transactions contemplated thereby;
(b) effect the action described in Section 4.03; and
(c) take such other actions as the directors may determine are
appropriate.
Section 5.02 ACCESS TO PROPERTIES AND RECORDS. Norske and Synoptech will
each afford to the officers and authorized representatives of the other full
access to the properties, books, and records of each other as the case may be,
in order that each may have full opportunity to make such reasonable
investigation as it shall desire to make of the affairs of the other, and each
will furnish the other with such additional financial and operating data and
other information as to the business and properties of each other, as the case
may be, as the other shall from time to time reasonably request.
Section 5.03 DELIVERY OF BOOKS AND RECORDS. At the Closing, each company
shall deliver each other the originals of the corporate minute books, books of
account, contracts, records, and all other books or documents now in each
company's possession or its representatives.
Section 5.04 SPECIAL COVENANTS AND REPRESENTATIONS REGARDING THE EXCHANGED
STOCK. The consummation of this Agreement and the transactions herein
contemplated, including the issuance of the Exchanged Norske Stock to the
shareholders of Synoptech as contemplated hereby, constitutes the offer and sale
of securities under the Securities Act and applicable state statutes. Such
transaction shall be consummated in reliance on exemptions from the registration
and prospectus delivery requirements of such statutes which depend, inter alia,
upon the circumstances under which the Synoptech Shareholders acquire such
securities. In connection with reliance upon exemptions from the registration
and prospectus delivery requirements for such transactions, at the Closing the
Synoptech Shareholders shall deliver to Norske letters of representation in the
form attached hereto as Schedule 5.04.
Section 5.05 THIRD PARTY CONSENTS AND CERTIFICATES. Norske and Synoptech
agree to cooperate with each other in order to obtain any required third party
consents to this Agreement and the transactions herein and therein contemplated.
Section 5.06 ACTIONS PRIOR TO CLOSING.
(a) From and after the date of this Agreement until the Closing Date
and except as set forth in the Agreement or Schedules attached hereto or as
permitted or contemplated by this Agreement, Norske and Synoptech
respectively, will each:
(i) carry on its business in substantially the same manner as it has
heretofore;
(ii) maintain and keep its properties in states of good repair and
condition as at present, except for depreciation due to ordinary wear and
tear and damage due to casualty;
(iii) maintain in full force and effect insurance comparable in
amount and in scope of coverage to that now maintained by it;
(iv) perform in all material respects all of its obligation under
material contracts, leases, and instruments relating to or affecting its
assets, properties, and business;
(v) use its best efforts to maintain and preserve its business
organization intact, to retain its key employees, and to maintain its
relationship with its material suppliers and customers; and
(vi) fully comply with and perform in all material respects all
obligations and duties imposed on it by all federal and state laws and all
rules, regulations, and orders imposed by federal or state governmental
authorities.
(b) From and after the date of this Agreement until the Closing Date,
neither Synoptech nor Norske will:
(i) make any change in their articles of incorporation (except as
provided for in Section 5.01) or bylaws;
(ii) take any action described in section 1.07 in the case of
Norske, or in section 3.07, in the case of Synoptech (all except as
permitted therein or as disclosed in the applicable party's schedules); or
(iii) enter into or amend any contract, agreement, or other
instrument of any of the types described in such party's schedules, except
that a party may enter into or amend any contract, agreement, or other
instrument in the ordinary course of business involving the sale of goods
or services.
Section 5.07 INDEMNIFICATION.
(a) Synoptech hereby agrees to indemnify Norske and each of the
officers, agents and directors of Norske as of the date of execution of
this Agreement against any loss, liability, claim, damage, or expense
(including, but not limited to, any and all expense whatsoever reasonably
incurred in investigating, preparing, or defending against any litigation,
commenced or threatened, or any claim whatsoever), to which it or they may
become subject arising out of or based on any inaccuracy appearing in or
misrepresentation made under Article III of this Agreement. The
indemnification, as well as the rights and remedies thereto, provided for
in this paragraph shall survive the Closing and consummation of the
transactions contemplated hereby and termination of this Agreement.
(b) Norske hereby agrees to indemnify Synoptech, the Synoptech
Shareholders, and each of the officers, agents and directors of Synoptech
as of the date of execution of this Agreement against any loss, liability,
claim, damage, or expense (including, but not limited to, any and all
expense whatsoever reasonably incurred in investigating, preparing, or
defending against any litigation, commenced or threatened, or any claim
whatsoever), to which it or they may become subject arising out of or based
on any inaccuracy appearing in or misrepresentation made under Article I of
this Agreement. The indemnification, as well as the rights and remedies
thereto, provided for in this paragraph shall survive the Closing and
consummation of the transactions contemplated hereby and termination of
this Agreement.
Section 5.08 REVERSE SPLIT. The Board of Directors of Synoptech (prior to
the Closing of this Agreement) which will initially constitute the Board of
Directors of Norske upon consummation of this Agreement, hereby agrees not to
effect a reverse split in connection with the Norske Common Stock for a period
of 60 days from the Closing, unless the shares of Norske Common Stock fail to
trade at or above $1.00 per share for a period of 10 consecutive business days,
commencing 10 days after the Closing.
ARTICLE VI
CONDITIONS PRECEDENT TO OBLIGATIONS OF NORSKE
The obligations of Norske under this Agreement are subject to the
satisfaction, at or before the Closing Date, of the following conditions:
Section 6.01 ACCURACY OF REPRESENTATIONS. The representations and
warranties made by Synoptech in this Agreement were true when made and shall be
true at the Closing Date with the same force and effect as if such
representations and warranties were made at and as of the Closing Date (except
for changes therein permitted by this Agreement), and Synoptech shall have
performed or complied with all covenants and conditions required by this
Agreement to be performed or complied with by Synoptech prior to or at the
Closing. Norske shall be furnished with a certificate, signed by a duly
authorized officer of Synoptech and dated the Closing Date, to the foregoing
effect.
Section 6.02 GOOD STANDING. Norske shall have received a certificate of
good standing from the Secretary of State of the State of Nevada or other
appropriate office, dated as of a date within ten days prior to the Closing Date
certifying that Synoptech is in good standing as a corporation in the State of
Nevada and has filed all tax returns required to have been filed by it to date
and has paid all taxes reported as due thereon.
Section 6.03 OTHER ITEMS. Norske shall have received such further
documents, certificates, or instruments relating to the transactions
contemplated hereby as Norske may reasonably request in order to satisfy due
diligence concerns.
ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS OF SYNOPTECH
AND THE SYNOPTECH SHAREHOLDERS
The obligations of Synoptech and the Synoptech Shareholders under this
Agreement are subject to the satisfaction, at or before the Closing Date, of the
following conditions:
Section 7.01 ACCURACY OF REPRESENTATIONS. The representations and
warranties made by Norske in this Agreement were true when made and shall be
true as of the Closing Date (except for changes therein permitted by this
Agreement) with the same force and effect as if such representations and
warranties were made at and as of the Closing Date, and Norske shall have
performed and complied with all covenants and conditions required by this
Agreement to be performed or complied with by Norske prior to or at the Closing.
Synoptech shall have been furnished with a certificate, signed by a duly
authorized executive officer of Norske and dated the Closing Date, to the
foregoing effect.
Section 7.02 GOOD STANDING. Synoptech shall have received a certificate
of good standing from the Secretary of State of the state of Delaware or other
appropriate office, dated as of a date within ten days prior to the Closing Date
certifying that Norske is in good standing as a corporation in the State of
Delaware and has filed all tax returns required to have been filed by it to date
and has paid all taxes reported as due thereon.
Section 7.03 FINANCING. Norske shall have completed a financing
effected in March and April 1999 to New York and Offshore investors compliant
with Rule 504 of Regulation D, as promulgated under the Securities Act of 1933,
as amended, as well as with applicable state securities laws, resulting in gross
proceeds of not less than $600,000.
Section 7.04 OTHER ITEMS.
(a) Synoptech shall have received a shareholders and option list of
Norske containing the name, address, and number of shares and options held
by each Norske shareholder and option holder as of the date of Closing
certified by an executive officer of Norske as being true, complete, and
accurate.
(b) Synoptech shall have received bank confirmation evidencing
compliance with Section 1.20 (including "good funds" status of such
money)and bank cards appointing Xxxx X. Xxxxxxx (or Xxxx Xxxxxxx
Overstoltz) as sole signatory.
(c) Synoptech shall have received such further documents,
certificates, or instruments relating to the transactions contemplated
hereby as Synoptech may reasonably request in order to satisfy due
diligence concerns.
ARTICLE VIII
MISCELLANEOUS
Section 8.01 BROKERS. Norske and Synoptech agree that there were no
finders or brokers involved in bringing the parties together or who were
instrumental in the negotiation, execution, or consummation of this Agreement.
Synoptech and Norske each agree to indemnify the other against any claim by
any third person other than those described above for any commission, brokerage,
or finders' fee arising from the transactions contemplated hereby based on any
alleged agreement or understanding between the indemnifying party and such third
person, whether express or implied from the actions of the indemnifying party.
Section 8.02 GOVERNING LAW. This Agreement shall be governed by,
enforced, and construed under and in accordance with the laws of the United
States of America and, with respect to matters of state law, with the laws of
Texas.
Section 8.03 NOTICES. Any notices or other communications required or
permitted hereunder shall be sufficiently given if personally delivered to it or
sent by registered mail or certified mail, postage prepaid, or by prepaid
telegram addressed as follows:
If to Norske to: Xxxxxxx XxXxxxxxxx
Norske Energy Corp.
00 Xxxxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
With copies to: Xxxxx Xxxxx
Xxxxx & Xxxxxxx
0 Xxxx 00/xx/ Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
If to Synoptech to: Xxxx Xxxxxxx Overstoltz
Synoptech Solutions Group, Inc.
0000 Xxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
With copies to: Xxxxxx X. Xxxxxxxxx, Esq.
Xxxxxx & Xxxxxxxxx
0000 Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
or 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, or
telegraphed.
Section 8.04 ATTORNEY'S FEES. In the event that any party institutes any
action or suit to enforce this Agreement or to secure relief from any default
hereunder or breach hereof, the breaching party or parties shall reimburse the
non-breaching party or parties for all costs, including reasonable attorneys'
fees, incurred in connection therewith and in enforcing or collecting any
judgment rendered therein.
Section 8.05 CONFIDENTIALITY. Each party hereto agrees with the other
parties that, unless and until the transactions contemplated by this Agreement
have been consummated, it and its representatives will hold in strict confidence
all data and information obtained with respect to another party or any
subsidiary thereof from any representative, officer, director, or employee, or
from any books or records or from personal inspection, os such other party, and
shall not use such data or information or disclose the same to others, except
(i) to the extent such data or information is published, is a matter of public
knowledge, or is required by law to be published; and (ii) to the extent that
such data or information must be used or disclosed in order to consummate the
transactions contemplated by this Agreement.
Section 8.06 SCHEDULES; KNOWLEDGE. Each party is presumed to have full
knowledge of all information set forth in the other party's schedules delivered
pursuant to this Agreement.
Section 8.07 THIRD PARTY BENEFICIARIES. This contract is solely between
Norske and Synoptech and the Synoptech Shareholders, and, except as specifically
provided, no director, officer, stockholder, employee, agent, independent
contractor, or any other person or entity shall be deemed to be a third party
beneficiary of this Agreement.
Section 8.08 ENTIRE AGREEMENT. This Agreement represents the entire
agreement between the parties relating to the subject matter hereof, including
this Agreement alone fully and completely expresses the agreement of the parties
relating to the subject matter hereof. There are no other courses of dealing,
understandings, agreements, representations, or warranties, written or oral,
except as set forth herein.
Section 8.09 SURVIVAL; TERMINATION. The representations, warranties, and
covenants of the respective parties shall survive the Closing Date and the
consummation of the transactions herein contemplated.
Section 8.10 COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original and all of which taken
together shall be but a single instrument.
Section 8.11 AMENDMENT OR 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 herewith, 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, theretofore, or
thereafter occurring or existing. At any time prior to the Closing Date, this
Agreement may be amended by a writing signed by all parties hereto, with respect
to any of the terms contained herein, and any term or condition of this
Agreement may be waived or the time for performance hereof may be extended by a
writing signed by the party or parties for whose benefit the provision is
intended.
IN WITNESS WHEREOF, the corporate parties hereto have caused this Agreement
to be executed by their respective officers, hereunto duly authorized, as of the
date first above-written.
NORSKE ENERGY CORP.
By:____________________________________
________________________, President
SYNOPTECH SOLUTIONS GROUP, INC.
By: /s/ Xxxx Xxxxxxx Overstoltz
_________________________________
Xxxx Xxxxxxx Overstoltz, Chief
Executive Officer
SYNOPTECH SOLUTIONS GROUP, INC.
SHAREHOLDERS
_______________________________________
By: ___________________________________
