Document:

exv10w1

 

Exhibit 10.1

Execution Copy

AMENDED AND RESTATED

AGREEMENT AND PLAN OF MERGER

AMONG

TAMBORINE HOLDINGS, INC.,

SES ACQUISITION CORPORATION

SYNTHESIS ENERGY HOLDINGS, INC.

AND

THE SHAREHOLDERS OF SYNTHESIS ENERGY HOLDINGS, INC.

APRIL 4, 2005

 

 

     AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER

     THIS AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER is made and entered into on this
4th day of April 2005 (this “Agreement”), by and among Tamborine Holdings, Inc., a
Mississippi corporation (the “Purchaser”), SES Acquisition Corporation, a Florida
corporation and wholly owned Subsidiary of the Purchaser (“Acquisition”), Synthesis Energy
Holdings, Inc., a Florida corporation (the “Corporation”), and the shareholders of the
Corporation who are listed on the signature pages hereto, which represents all of the shareholders
of the Corporation (collectively, the “Sellers”). Terms used herein and not otherwise
defined shall have the meanings set forth in Section 11.3 hereof.

     WHEREAS, upon consummation of the Restructuring, the Corporation will be a holding
company that through its Subsidiaries will provide energy and utility solutions, equipment
and technology to its customers (the “Business”);

     WHEREAS, the Purchaser, Acquisition and the Corporation intend to effect a merger of
Acquisition with and into the Corporation (the “Merger”) in accordance with terms and
subject to the conditions of this Agreement and in accordance with the Florida Business
Corporation Act (the “FBCA”);

     WHEREAS, upon the consummation of the Merger, Acquisition will cease to exist, and the
Corporation will be the surviving corporation and become a wholly owned Subsidiary of the
Purchaser;

     WHEREAS, the respective Boards of Directors of the Purchaser, Acquisition and the
Corporation have each (i) determined that this Agreement, the Merger and the transactions
contemplated hereby and thereby are advisable and in the best interests of their respective
shareholders and (ii) adopted this Agreement and approved the Merger and the transactions
contemplated hereby and thereby;

     WHEREAS, the Board of Directors of the Purchaser, as the sole shareholder of Acquisition,
has determined that the Merger is advisable and in the best interests of Acquisition and has
adopted this Agreement and approved the Merger and the transactions contemplated hereby and
thereby; and

     WHEREAS, for United States income tax purposes, it is intended that the Merger qualify
as a “reorganization” under the provisions of Section 368 of the Code;

     NOW, THEREFORE, in consideration of the representations and warranties, covenants and
agreements, and subject to the conditions contained herein, the Sellers, the Corporation,
the Purchaser and Acquisition hereby agree as follows:

ARTICLE
I

THE MERGER

     1.1. The Merger. Subject to the terms and conditions contained
herein, at the Effective Time, pursuant to the Merger, Acquisition shall be merged with
and into the

 

 

Corporation in accordance with the requirements of the FBCA. Thereupon, the corporate
existence of the Corporation, with all its rights, privileges, immunities, powers and purposes,
shall continue unaffected and unimpaired by the Merger, and the Corporation, as the corporation
surviving the Merger, shall be fully vested therewith, the separate existence of Acquisition shall
cease upon the Merger becoming effective as herein provided and thereupon the Corporation and
Acquisition shall be a single corporation (sometimes referred to herein as the “Surviving
Corporation”).

     1.2. Filing. As soon as practicable following fulfillment of the conditions
specified in Article VI and Article VII hereof, and provided that this Agreement has not been
terminated and
abandoned pursuant to Article IX hereof, Acquisition and the Corporation will cause an executed
counterpart of the Articles of Merger in substantially the form of Exhibit 1.2 hereto (the
“Articles of Merger”) to be filed with the Secretary of State of the State of Florida in
accordance with the

provisions of Section 607.1109 of the FBCA.

     1.3. Effective Time of the Merger. The Merger shall be effective at the time that
the filing of the counterpart of the Articles of Merger with the Secretary of State of the State
of Florida referred to in Section 1.2 is completed, which time is sometimes referred to herein as
the “Effective Time.”

     1.4. Effect of the Merger. The Merger shall have the effects set forth in Sections
607.1106 and 607.11101 of the FBCA. As promptly as practicable after the Effective Time, the
Purchaser shall change its name to “SES, Inc.”

     1.5. Certificate of Incorporation. At the Effective Time, the certificate of
incorporation of the Corporation, as amended pursuant to the Articles of Merger, shall be the
certificate of incorporation of the Surviving Corporation, which may be amended from time to
time after the Effective Time as provided by law.

     1.6. Bylaws. At the Effective Time, the bylaws of the Corporation shall be the
bylaws of the Surviving Corporation, which may be amended from time to time after the Effective
Time as provided by the certificate of incorporation or said bylaws.

     1.7. Directors and Officers.

          (a) From and after the Effective Time, the members of the Board of Directors of the
Corporation immediately prior to the Effective Time set forth on Schedule 1.7(a)
attached hereto shall become the members of the Board of Directors of the Surviving Corporation
and the Purchaser. At or immediately prior to the Effective Time, all members of the boards of
directors of Acquisition and of the Purchaser shall tender their resignations and such
vacancy(ies) shall be filled solely by the members of the board of directors of the Corporation
set forth on Schedule 1.7(a) attached hereto.

          (b) From and after the Effective Time, the officers of the Corporation immediately prior
to the Effective Time set forth on Schedule 1.7(a) attached hereto shall become the
officers of the Surviving Corporation and the Purchaser in the same capacities they
respectively held in the Corporation. At or immediately prior to the Effective Time, all
officers of Acquisition and of the Purchaser shall tender their resignations and all officers
of the

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Surviving Corporation set forth on Schedule 1.7(a) attached hereto shall be such
persons who shall be designated as the officers of the Surviving Corporation and the Purchaser.

     1.8. Conversion. At the Effective Time, all of the issued and outstanding shares of
capital stock of Acquisition and the Corporation Capital Stock shall, by virtue of the Merger and
without any action on the part of the respective holders thereof, become and be converted into
shares of capital stock of the Surviving Corporation or into the right to receive the Purchaser
Common Stock, par value $0.01 share (the “Purchaser Common Stock”), or be canceled, as the
case may be, as follows:

          (a) Each outstanding share of common stock, par value $0.01 per share, of Acquisition shall
be converted into one share of common stock, par value $0.01 per share, of the Surviving
Corporation.

          (b) Each treasury share of capital stock of the Corporation, if any, shall be canceled,
and no payment shall be made in respect thereof.

          (c) All of the issued and outstanding shares of capital stock of the Corporation (the
“Corporation Capital Stock”) that shall be issued and outstanding at the Effective Time
(other than shares of the Corporation’s common stock, $0.01 par value per share (the
“Corporation Common Stock”), held in the treasury of the Corporation) (the
“Shares”) shall be converted into the right to receive an aggregate of 21,050,000 shares
of the Purchaser Common Stock subject to adjustment as provided in Section 1.9 (the “Merger
Consideration”), which shall be equal to 75% of the aggregate number of shares of Purchaser’s
capital stock on a fully diluted basis to be issued and outstanding after giving effect to (i) the
issuance of 21,050,000 shares of the Purchaser Common Stock as Merger Consideration, (ii) the
consummation of the sale of 1,000,000 shares of the Purchaser Common Stock in the Private
Placement, and (iii) the forfeiture of 94,000,000 shares of Purchaser Common Stock by Alexander
Gomez, the majority shareholder of the Purchaser, or his nominees or assigns (“Tamborine
Majority Shareholder”) immediately prior to the Effective Time (the “Exchange Ratio”)
(items (i), (ii) and (iii) shall be referred to as the “Merger Transactions”). The
allocation of the shares of the Purchaser Common Stock to be issued as Merger Consideration to the
Sellers pursuant to the Merger is set forth on Schedules 1.8(c) attached hereto, which
shares are subject to the Merger Consideration adjustments set forth in Sections 1.9(a) through
(d) below.

          (d) No fractional shares of the Purchaser Common Stock shall be issued.

     1.9. Merger Consideration Adjustments.

          (a) If, between the date of this Agreement and the Effective Time, the issued and
outstanding shares of the Corporation Capital Stock or the Purchaser Common Stock are changed
into a different number or class or series of shares by reason of any stock split, stock
dividend, reverse stock split, reclassification, recapitalization exchange, extraordinary
distribution, redemption or other similar transaction then, if the effect of the same is not
already accommodated in the calculation of the Exchange Ratio, the Exchange Ratio shall be
appropriately and correspondingly adjusted downward or upward (as the case may be) to the extent
the record date for any such event is prior to the Effective Time whereby the Sellers shall

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maintain 75% of the aggregate number of shares of the Purchaser’s capital stock on a
fully diluted basis after giving effect to the Merger Transactions.

          (b) At the Closing, the Sellers shall be issued 21,050,000 shares of the Purchaser Common
Stock as the aggregate Merger Consideration and, as a result, the Sellers shall own 80.19% of the
aggregate number of shares of the Purchaser’s capital stock on a fully diluted basis after giving
effect to the Merger, the sale of 200,000 shares of the Purchaser Common Stock in the Private
Placement, and the forfeiture of 94,000,000 of Purchaser Common Stock to the Purchaser by the
Tamborine Majority Shareholder pursuant to Section 5.14; provided, however, that
if 1,000,000 shares of the Purchaser Common Stock is sold in the Private Placement, such
percentage shall be reduced to 75% of the aggregate number of shares of the Purchaser’s capital
stock on a fully diluted basis.

          (c) If the number of shares of Purchaser Common Stock sold in the Private Placement is less
than 1,000,000, then the Sellers shall maintain the percentage of the Purchaser’s capital stock
on a fully diluted basis after giving effect to the Merger Transactions determined by a fraction
(i) the numerator of which shall be the 21,050,000 shares of the . Purchaser Common
Stock issued to the Sellers as Merger Consideration and (ii) the denominator of which shall be
(x) the number of shares of Purchaser Common Stock outstanding immediately prior to the Merger
after giving effect to the forfeiture of 94,000,000 shares of the Purchaser Common Stock to the
Purchaser by Tamborine Majority Shareholder pursuant to Section 5.14, plus (y) the 21,050,000
shares of the Purchaser Common Stock issued to the Sellers as Merger Consideration, plus (z) the
actual number of shares sold in the Private Placement.

          (d) If pursuant to Section 5.14 the Tamborine Majority Shareholder forfeits and tenders
to the Purchaser a number of shares of Purchaser Common Stock that is greater or less than
94,000,000, the number of share of Purchaser Common Stock to be issued as Merger
Consideration shall be adjusted upward or downward to provide that the Sellers shall maintain
the same percentage ownership of the Purchaser’s capital stock on a fully diluted basis as
determined pursuant to Sections 1.9(a), (b) and (c).

     1.10. Payment for Shares.

          (a) At the Effective Time, each holder of a certificate or certificates (the
“Certificate”) theretofore representing issued and outstanding Shares entitled to
receive the
Merger Consideration therefore may surrender such Certificates to the Purchaser or the Surviving
Corporation and receive in exchange therefore, the Merger Consideration as provided in Section
1.8 immediately upon such surrender. In case any payment pursuant to this Section 1.10 is to be
made to a holder other than the registered owner of a surrendered Certificate, it shall be a
condition of such payment that the certificate so surrendered shall be properly endorsed or
otherwise in proper form for transfer and that all applicable transfer and other similar Taxes
shall have been paid by the Corporation (or the Surviving Corporation). Until surrendered in
accordance with the provisions of this Section 1.10, the Certificate or Certificates which
immediately prior to the Effective Time represented all the issued and outstanding Shares shall
represent for all purposes only the right to receive the Merger Consideration.

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          (b) In the event any Certificate shall have been lost, stolen or destroyed, upon the
making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or
destroyed, the Purchaser or the Surviving Corporation shall issue in exchange for such lost,
stolen or destroyed Certificate the Merger Consideration payable in exchange therefore pursuant to
this Article 1. The Board of Directors of the Purchaser or the Surviving Corporation may, in its
discretion and as a condition precedent to the issuance thereof, require the owner of such lost,
stolen or destroyed Certificate to give the Purchaser or the Surviving Corporation, as the case
may be, a bond in such sum as it may direct as indemnity against any Claim that may be made
against the Surviving Corporation with respect to the Certificate alleged to have been lost,
stolen or destroyed.

          (c) Promptly following the date which is six months after the Closing Date, each holder of a
Certificate may surrender such Certificate to the Surviving Corporation and, subject to
applicable abandoned property, escheat and similar laws, receive in exchange therefore the Merger
Consideration payable pursuant to this Article I without any interest thereon.

     1.11. Stock Options, Stock Appreciation Rights and Warrants. The Corporation and
none of its Subsidiaries have or will have issued Options, stock appreciation rights, or
warrants or have any outstanding Options, stock appreciation rights or warrants to purchase any
of their respective shares of capital stock.

     1.12. Closing of Transfer Books. At the Effective Time, the stock transfer books of
the Corporation shall be closed and no transfer of Shares or Options shall thereafter be made.
If, after the Effective Time, Certificates are presented to the Purchaser or the Surviving
Corporation, they shall be canceled and exchanged for the Merger Consideration in accordance with
Section 1.8. From and after the Effective Time, no Shares shall be deemed to be outstanding, and
holders of Certificates shall cease to have any rights with respect thereto except as provided
herein or by law.

     1.13. Actions Taken at Closing. At the Closing, (a) the Corporation shall deliver to
the Purchaser the various certificates, instruments, Contracts, consents and documents required to
be delivered to the Purchaser by the Corporation and the Sellers as a condition precedent to the.
Purchaser’s obligations hereunder pursuant to Article VI; (b) the Purchaser shall deliver to the
Corporation the various certificates, instruments, Contracts, consents and documents required to
be delivered to the Corporation and the Sellers by the Purchaser as a condition precedent to the
Corporation’s obligations hereunder pursuant to Article VII; (c) the Corporation and Acquisition
shall execute and file with the Secretary of State of the State of Florida the Articles of Merger
and shall have the executed plan of merger attached thereto; and (d) the Purchaser shall deliver
the Merger Consideration in accordance with Section 1.10.

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF THE CORPORATION AND THE
SELLERS

     The Corporation represents and warrants to the Purchaser and Acquisition as of the
date hereof and as of the Closing Date, except for the representations and warranties in
Sections

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2.6(b), 2.24, and 2.25 in which each Seller severally and the Corporation represents and
warrants to the Purchaser and Acquisition as of the date hereof and as of the Closing Date as
follows, it being acknowledged and agreed that the representations and warranties set forth in
this Article II are based on the assumption that the Restructuring has occurred:

     2.1. Corporate Organization, Etc. The Corporation is a corporation duly organized,
validly existing and in good standing under the laws of its jurisdiction of incorporation with
full corporate power and authority to carryon its business as it is now being conducted and to
own, operate and lease its properties and assets. The Corporation is duly qualified or licensed
to do business and is in corporate and Tax good standing in every jurisdiction in which the
conduct of its business, the ownership or lease of its properties, require it to be so qualified
or licensed. Such jurisdictions are set forth in Schedule 2.1(a) attached hereto. True,
complete and correct copies of the Corporation’s articles of incorporation and bylaws as
presently in effect are set forth in Schedule 2.1(b) attached hereto.

     2.2. Subsidiaries. Set forth on Schedule 2.2(a) attached hereto is a
complete and accurate list of all Subsidiaries of the Corporation after the Restructuring. Each
Subsidiary is a corporation duly organized, validly existing and in corporate and Tax good
standing under the laws of its jurisdiction of incorporation with full corporate power and
authority to carryon its business as it is now being conducted and to own, operate and lease its
properties and assets. Each Subsidiary is duly qualified or licensed to do business and is in
corporate and Tax good standing in every jurisdiction in which the conduct of its business, the
ownership or lease of its properties, require it to be so qualified or licensed. Such
jurisdictions are set forth in Schedule 2.2(b) attached hereto. All of the outstanding
shares of the capital stock, all Options to acquire capital stock, and all securities that are
exchangeable or convertible into capital stock, of each Subsidiary are owned or will be owned
after the Restructuring by the Corporation or a wholly-owned Subsidiary of the Corporation, are
duly authorized, validly issued, fully paid and nonassessable, and have been issued in compliance
with all applicable Regulations and Contracts. The Corporation or its wholly-owned Subsidiary has
good and marketable title to all of the shares of outstanding capital stock, all Options to
acquire capital stock, and an securities that are exchangeable or convertible into capital stock,
of each Subsidiary, free and clear of all Liens, Contracts, Options or other limitations
whatsoever. True, complete and correct copies of each Subsidiary’s charter and bylaws as
presently in effect are set forth in Schedule 2.2(c) attached hereto. No shares of
capital stock of any Subsidiary are reserved for issuance and there are no outstanding Options,
Claims, Contracts, convertible or exchangeable securities or other commitments, contingent or
otherwise, relating to the capital stock of any Subsidiary or pursuant to which any Subsidiary is
or may become obligated to issue or exchange any shares of capital stock. Except as set forth in
Schedule 2.2(d) attached hereto, the Corporation does not have any obligation to make any
additional Investments in any Person.

     2.3. Capitalization. The authorized, issued and outstanding capital stock, Options, and
securities that are convertible into, or exchangeable for, capital stock of the Corporation on a
fully diluted basis as of the date hereof, and without giving effect to any of the transactions
contemplated hereby, including after the Restructuring, are held beneficially and of record by the
Persons as set forth in Schedule 2.3(a) attached hereto. The Corporation does not have any
Contracts containing any profit participation features, stock appreciation rights or phantom stock
options, or similar Contracts that allow any Person to participate in the equity of the
Corporation

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except as set forth on Schedule 2.3(a) attached hereto. The Corporation is not
subject to any obligation or Contract (contingent or otherwise) to repurchase or otherwise acquire
or retire any shares of its capital stock or any Options. All of the outstanding shares of the
Corporation’s capital stock are validly issued, fully paid and non-assessable. There are no shares
of capital stock of the Corporation held in the treasury of the Corporation and no shares of
capital stock of the Corporation are currently reserved for issuance for <my purpose or upon
the occurrence of any event or condition. There are no existing Contracts or Options between a
Seller, on the one hand, and any other Person, on the other hand, regarding the Shares. Except as
set forth in Schedule 2.3(b) attached hereto, there are no Contracts between or among any
of the Corporation’s shareholders or any other Persons that are binding upon the Corporation with
respect to the voting, transfer, encumbrance of the Corporation’s capital stock or Options to
acquire capital stock or securities that are exchangeable or convertible into capital stock of the
Corporation or with respect to any aspect of the Corporation’s governance or dividends or
distributions. The stock record books of the Corporation that have been delivered to Purchaser for
inspection prior to the date hereof are complete and correct in all material respects. The
Corporation does not have any issued and outstanding shares of preferred stock.

     2.4. Books and Records. The corporate minute books of the Corporation that have been
made available to Purchaser for inspection are complete and correct in all material respects and
contain all of the proceedings of the shareholders and directors of the Corporation. A true and
complete list of the incumbent directors and officers of the Corporation is set forth in
Schedule 2.4 attached hereto. Neither the Corporation nor any Subsidiary has any of its
records, systems, controls, data or information recorded, stored, maintained, operated or
otherwise wholly or partly dependent upon or held by any means (including any electronic,
mechanical or photographic process, whether computerized or not) which (including all means of
access thereto and therefrom) are not under the exclusive ownership and direct control of the
Corporation or a wholly-owned Subsidiary.

     2.5. Title to Stock. All of the outstanding the Corporation Capital Stock is owned
by the Sellers, are duly authorized, validly issued, fully paid and nonassessable, are free of all
Liens and Contracts, and have been issued in compliance with all applicable securities laws. All
of the Shares were acquired from third parties or the Corporation in compliance with all
applicable Regulations, free and clear of any rescission and Contract rights. There is no
outstanding Contract with the Corporation or any other Person to purchase, redeem or otherwise
acquire any outstanding shares of the capital stock or Options of the Corporation, or securities
or obligations of any kind convertible into any shares of the capital stock of the Corporation.
The Corporation has not redeemed any securities in violation of any Contract, Order or Regulation.
Upon
payment of the Merger Consideration to the Sellers at the Closing, the Sellers will convey good
and marketable title to the Shares, free and clear of all Liens, Orders, Contracts or other
limitations whatsoever. The assignments, endorsements, stock powers and other instruments of
transfer delivered by the Sellers to Purchaser at the Closing will be sufficient to transfer the
Sellers’ entire interest, legal and beneficial, in the Shares to Purchaser.

     2.6. Authorization, Etc.

          (a) The Corporation has full power and authority to enter into this Agreement and the
agreements contemplated hereby to which the Corporation is a party and to consummate

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the transactions contemplated hereby and thereby. The execution, delivery and performance of
this Agreement and all other agreements and transactions contemplated hereby have been duly
authorized by the Board of Directors and prior to the Closing will be authorized by the
shareholders of the Corporation and no other corporate proceedings on their part are necessary to
authorize this Agreement and the agreements contemplated hereby and the transactions contemplated
hereby and thereby. This Agreement and all other agreements contemplated hereby to be entered into
by the Corporation each constitutes a legal, valid and binding obligation of the Corporation
enforceable against the Corporation in accordance with its terms.

          (b) Each Seller is the sole owner of and has full right, power and authority to sell and vote
the Shares set forth opposite the signature line for such Seller’s name below. Each Seller has
full power and authority to enter into this Agreement and the agreements contemplated hereby and
to deliver the Shares and the certificates evidencing such Shares to the Purchaser as provided for
herein, free and clear of all Liens. This Agreement and all other agreements contemplated hereby
to be entered into by the Sellers each constitute a legal, valid and binding obligation of the
Seller who is a party thereto enforceable against such Seller in accordance with its terms.

          (c) Except as set forth in Schedule 2.6 attached hereto, the execution, delivery and
performance by the Corporation and the Sellers of this Agreement, and all other agreements
contemplated hereby, and the fulfillment of and compliance with the respective terms hereof and
thereof by the Corporation and the Sellers, do not and will not (a) conflict with or result in a
breach of the terms, conditions or provisions of, (b) constitute a default or event of default
under (whether with or without due notice, the passage of time or both), (c) result in the
creation of any Lien upon the Corporation’s capital stock or assets pursuant to, (d) give any
third party the right to modify, terminate or accelerate any obligation under, (e) result in a
violation of, or (f) require any authorization, consent, approval, exemption or other action by,
notice to, or filing with any third party or Authority pursuant to, the charter or bylaws of the
Corporation or any applicable Regulation, Order or Contract to which the Corporation, the Sellers
or their respective properties or the Shares are subject. Each of the Sellers and the Corporation
has complied with all applicable Regulations and Orders in connection with the execution, delivery
and performance of this Agreement, the agreements contemplated hereby and the transactions
contemplated hereby and thereby.

     2.7.
Financial Statements.

          (a) Attached as Schedule 2.7(a) attached hereto are (i) unaudited year-end balance
sheets of Synthesis Energy Systems, Inc., a company organized under the laws of the British
Virgin Islands (“SESI”), as of December 31, 2003 and 2004 and Synthesis Energy Systems,
LLC, a West Virginia limited liability company (“SESLLC”), as of December 31, 2004 and
statements of income, shareholders’ equity and cash flow of the Corporation for each of the
fiscal years then ended, as applicable, (ii) an unaudited balance sheet of SESI and SESLLC as of
February 28,2005 and unaudited statements of income, shareholders’ equity and cash flow for the
two-month period then ended, and (iii) financial projections of the Corporation and its
Subsidiaries as if the Restructuring had been consummated as of January 1, 2005 and for the
calendar years 2005, 2006, 2007, 2008 and 2009. Such balance sheets and the notes thereto fairly
present the financial position of the Corporation at the respective dates thereof, and such

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statements of income, shareholders’ equity and cash flow and the notes thereto fairly
present the results of operations for the periods referred to therein. All of the foregoing
financial statements and projections were prepared from the books and records of the
Corporation. The Corporation
does not utilize any percentage of completion or similar method of accounting for revenue,
income or cost recognition purposes. The Corporation has not written off any research and
development costs, incurred any reorganization, restructuring or similar costs or changed the
book value of any assets, liabilities or goodwill of any Subsidiary or business acquired by
the Corporation. Except as set forth in Schedule 2.2(d) attached hereto, the
Corporation does not have any obligation to make any additional Investments in any Person.
All properties used in the Corporation’s business operations during the period covered by
the foregoing financial statements are reflected in the financial statements. The foregoing
balance sheets and statements of operations, shareholders’ equity and cash flows and the
notes thereto are herein collectively referred to as the “Financial Statements” and
December 31, 2004 is herein referred to as the
“Financial Statement Date” .

          (b) Except as set forth in Schedule 2.7(b) attached hereto, the Corporation
does not have any Indebtedness, obligation or liability (whether accrued, absolute, contingent,
unliquidated or otherwise, known or unknown to the Corporation, whether due or to become due)
arising out of transactions entered into at or prior to the Closing Date, or any state of
facts existing at or prior to the Closing Date, other than: (i) liabilities set forth in the
December 31, 2004 balance sheet of the Corporation, (ii) liabilities and obligations
that have arisen after December 31, 2004 in the ordinary course of business (none of
which is a liability resulting from breach of a Contract, Regulation, Order or warranty,
tort, infringement or Claim), or (iii) liabilities incurred in connection with the
transactions by this Agreement.

          (c) There is no Person that has Guaranteed, or provided any financial accommodation of, any
Indebtedness, obligation or liability of the Corporation or for the benefit of the Corporation
for the periods covered by the Financial Statements other than as set forth in the Financial
Statements. The management of the Corporation has disclosed to the Corporation’s independent
auditors and the Purchaser all facts and circumstances known to them that are material and bear
upon the accuracy of the financial statements. The Corporation’s accounting systems and controls
are sufficient to detect material fraud and inaccuracies in the financial reporting processes and
reports.

     2.8. Employees. Schedule 2.8 attached hereto sets forth a list of all
officers, directors and key employees (meaning those earning more than $50,000 annually) of the
Corporation, together with a description of the rate and basis for their total compensation. The
Corporation has conducted its business in compliance with all Regulations and Orders affecting
employment and employment practices applicable to the Corporation, including the payment of wages
and hours. The Corporation has no collective bargaining agreements and there have been no
strikes, work stoppages nor any demands for collective bargaining by any union, labor
organization or other Person. There is no dispute or controversy with any union or other
organization of the Corporation’s employees and no arbitration proceedings are pending or, to the
best knowledge of the Corporation, threatened involving a dispute or controversy affecting the
Corporation. At the Closing the Corporation will not have any liability or obligation to any of
its current or former employees, officers or directors (including unaccrued year end bonuses)
other than for the payment of salaries to be paid in the ordinary course of business. Except as
set forth on

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Schedule 2.8 attached hereto, the Corporation has not taken any action, or failed to
take any action, that has or would be reasonably likely to result in any Claim by an employee
that he has been constructively terminated or due severance payments. Upon the consummation of
the transactions contemplated hereby and pursuant to the agreements referred to herein, the
Corporation will not have any “change in control” bonus or other obligations to any of its
employees, consultants or other Persons performing services for the Corporation.

     2.9. Absence of Certain Changes. Since the Financial Statement Date, there has not
been any (a) Material Adverse Change in the business, operations, properties, assets, condition
(financial or otherwise), results, plans, strategies or prospects of the Corporation; (b)
damage,
destruction or loss, whether covered by insurance or not, having a cost of $100,000 or more, with
regard to the Corporation’s property and business; (c) declaration, setting aside or payment of
any dividend or distribution (whether in cash, stock or property) in respect of the Corporation’s
capital stock, Options or securities convertible into or exchangeable for capital stock; (d)
redemption or other acquisition of capital stock, Options or securities convertible into or
exchangeable for capital stock by the Corporation or any payment of any stock appreciation right
or other profit participation; (e) increase in the compensation payable to or to become payable by
the Corporation to its officers or employees or any adoption of or increase in any bonus,
insurance, pension or other employee benefit plan, payment or arrangement made to, for or with any
such officers or employees or any Affiliate of the Corporation; (f) entry into any material
Contract not in the ordinary course of business, including without limitation, any borrowing from
any new lender or in excess of the existing credit limits or capital expenditure (except for the
capital expenditures set forth in Schedule 2.18 attached hereto); (g) change by the
Corporation in accounting methods or principles or any write-down, write-up or revaluation of any
assets of the Corporation except depreciation accounted for in the ordinary course of business and
write downs of inventory which reflect the lower of cost or market and which are in the ordinary
course of business; (h) failure to promptly pay and discharge current liabilities or agree with
any party to extend the payment of any current liability; (i) Lien placed on any property of the
Corporation other than Permitted Liens; (j) sale, assignment, transfer, lease, license or
otherwise placement of a Lien on any of the Corporation’s tangible assets, except in the ordinary
course of business consistent with past practice, or canceled any material debts or Claims; (k)
sale, assignment, transfer, lease, license or otherwise placement of a Lien on any Intellectual
Property rights or other intangible assets, disclosure of any material confidential information to
any Person or abandoned or permitted to lapse any Intellectual Property rights; (1) commitment to
make any charitable contributions or pledges exceeding in the aggregate $25,000; or (m) agreement,
whether orally or in writing, to do any of the foregoing.

     2.10. Contracts.

          (a) Except as set forth in Schedule 2.10(a) attached hereto, as of the Closing Date, the
Corporation is not a party to any written or oral: (1) pension, profit sharing, Option, employee
stock purchase, stock appreciation right, phantom stock option or other plan providing for deferred
or other compensation to employees or any other employee benefit plan (other than as set forth in
Schedule 2.15 attached hereto), or any Contract with any labor union or labor group; (2)
Contract relating to loans to officers, directors, Sellers or their Affiliates; (3) Contract
relating to the borrowing of money or the mortgaging, pledging or otherwise placing a Lien on any
asset of the Corporation; (4) Guarantee of any obligation; (5) Contract under which the

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Corporation has advanced or loaned, or agreed to advance or loan, any Person amounts in the
aggregate exceeding $10,000; (6) Contract pursuant to which the Corporation is lessor of or
permits any third party to hold or operate any property, real or personal, owned or controlled
by the Corporation; (7) warranty Contract with respect to its services rendered or its products
sold or leased; (8) Contract or non-competition provision in any Contract prohibiting it from
freely engaging in any business or competing anywhere in the world; (9) Contract for the
purchase, acquisition or supply of inventory and other property and assets, whether for resale
or otherwise in excess of $10,000; (10) Contracts with independent agents, brokers, dealers or
distributors which provide for annual payments in excess of $10,000; (11) employment,
consulting, sales, commissions, advertising or marketing Contracts; (12) Contracts providing for
“take or pay” or similar unconditional purchase or payment obligations; (13) Contracts with
Persons with which, directly or indirectly, a Seller also has a Contract; (14) Contract that
requires the consent of any Person, or contains any provision that would result in a
modification of any rights or obligation of any Person thereunder upon a change in control of
the Corporation or which would provide any Person any remedy (including rescission or liquidated
damages), in connection with the execution, delivery or performance of this Agreement and the
agreements contemplated hereby and the consummation of the transactions contemplated hereby and
thereby; (15) nondisclosure or confidentiality Contracts; (16) power of attorney or other
similar Contract or grant of agency; or (17) any other Contract which is material to its
operations and business prospects or involves a consideration in excess of $25,000 annually,
excluding any purchase orders in the ordinary course of business.

          (b) The Corporation has performed in all material respects all obligations required to be
performed by it and is not in default in any respect under or in breach of nor in receipt of any
Claim of default or breach under any material Contract to which the Corporation is subject
(including without limitation all performance bonds, warranty obligations or otherwise); no
event has occurred which with the passage of time or the giving of notice or both would result
in a default, breach or event of non-compliance under any material Contract to which the
Corporation is subject (including without limitation all performance bonds, warranty obligations
or otherwise); the Corporation does not have any present expectation or intention of not fully
performing all such obligations; the Corporation does not have any knowledge of any breach or
anticipated breach by the other Persons to any such Contract to which it is a party.

          (c) The Corporation has delivered to the Purchaser true and complete copies of all the
Contracts and documents listed in the schedules to this Agreement.

          (d) Schedule 2.10(d) attached hereto sets forth a complete and accurate list of
each outstanding bid or proposal for business submitted by the Corporation in excess of
$25,000.

     2.11. Title and Related Matters.

          (a) Except
 as set forth in Schedule 2.1l(a) attached hereto, the Corporation has
good and marketable title to all real and personal, tangible and intangible, property and other
assets reflected in the Financial Statements or acquired after the Financial Statement Date,
free and clear of all Liens, except Permitted Liens. All properties used in the Corporation’s
business operations for the periods covered by the Financial Statements are reflected in the
Financial Statements, except as to those assets that are leased. Schedule 2.11(b)
attached hereto sets forth

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a complete and accurate summary of all leased assets that have annual rental payments in
excess of $12,000, describing the expiration date of such lease, the name of the lessor, the
annual rental payment and whether a consent is required from the lessor to consummate the
transactions contemplated hereby.

          (b) All the Corporation’s leases are in full force and effect, and valid and enforceable in
accordance with their respective terms. The Corporation has not received any notice of any, and
there exists no event of default or event which constitutes or would constitute (with notice or
lapse of time or both) a default by the Corporation or any other Person under any lease. All rent
and other amounts due and payable with respect to the Corporation’s leases have been paid through
the date of this Agreement and all rent and other amounts due and payable with respect to the
Corporation’s leases that are due and payable on or prior to the Closing Date will have been paid
prior to the Closing Date. All lessors under the Corporation’s real property leases have consented
(where such consent is necessary) or prior to the Closing will have consented (where such consent
is necessary) to the consummation of the transactions contemplated by this Agreement without
requiring material modification in the rights or obligations thereunder. The Corporation has
received no written notice that the landlord with respect to any real property lease would refuse
to renew such lease upon expiration of the period thereof upon substantially the same terms,
except for rent increases consistent with past experience or market rentals.

          (c) None of the assets belonging to the Corporation is or will be on the Closing Date
subject to any (i) Contracts of sale or lease except as set forth in Schedule 2.11(c)
attached hereto, except Contracts for the sale of inventory in the ordinary and regular
course of business or (ii) Liens, except for Permitted Liens and the Liens set forth in
Schedule 2.11(c) attached hereto.

          (d) There has not been since the Financial Statement Date and will not be prior to the
Closing Date, any sale, lease, or any other disposition or distribution by the Corporation of
any of its assets or properties, now or hereafter owned by it, except transactions in the
ordinary and regular course of business or as otherwise consented to by the Purchaser.
Immediately after the Closing, the Purchaser will own, or have the unrestricted right to use,
all properties and assets that are used (or necessary) in connection with the Corporation’s
business on the same economic basis as before the Closing.

     2.12. Litigation. Schedule 2.12 attached hereto sets forth a true and
complete list of all Claims and Orders involving the Corporation since November 3, 2003. Except as
set forth in Schedule 2.12 attached hereto, to the best knowledge of the Corporation,
there is no Claim or Order threatened against the Corporation nor is there any reasonable basis
therefor. Except as set forth on Schedule 2.12 attached hereto, the Corporation is fully
insured with respect to each of the matters set forth on Schedule 2.12 attached hereto and
the Corporation has not received any opinion or a memorandum or advice from legal counsel to the
effect that it is exposed, from a legal standpoint, to any liability or obligations which could
have an adverse effect in excess of $10,000.

-12-

 

     2.13. Tax Matters.

          (a) Tax Returns. The Corporation has timely filed or caused to be timely filed
with the appropriate taxing authorities all tax returns, statements, forms and reports (including
elections, declarations, disclosures, schedules, estimates and information Tax Returns) for Taxes
(“Tax Returns”) that are required to be filed by, or with respect to, the Corporation on
or prior to the Closing Date. Such Tax Returns have been correct and complete in all material
respects.

          (b) Payment of Taxes. All Taxes and Tax liabilities due by or with respect to the
income, assets or operations of the Corporation for all taxable years or other taxable periods
that end on or before the Closing Date and, with respect to any taxable year or other taxable
period beginning on or before and ending after the Closing Date, the portion of such taxable year
or period ending on and including the Closing Date (“Pre-Closing Period”) have been timely
paid or will be timely paid in full on or prior to the Closing Date or accrued and adequately
disclosed and fully provided for in accordance with GAAP on the Financial Statements.

          (c) Except as set forth in Schedule 2.13(c) attached hereto,

               (i) the Corporation has not been the subject of an audit or other examination of Taxes by the
tax authorities of any nation, state or locality; (ii) no such audit is contemplated or pending;
and (1ii) the Corporation has not received any written notices from any taxing authority relating
to any issue which could affect the Tax liability of the Corporation;

               (ii) the Corporation, as of the Closing Date, (A) has not entered into an agreement or waiver
or been requested to enter into an agreement or waiver extending any statute of limitations
relating to the payment or collection of Taxes of the Corporation that has not expired, or (B) is
not presently contesting the Tax liability of the Corporation before any court, tribunal or
agency;

               (iii) the Corporation has not been included in any “consolidated,” “unitary” or “combined”
Tax Return provided for under the law of the United States, any foreign jurisdiction or any state
or locality with respect to Taxes for any taxable period for which the statute of limitations has
not expired (other than a group of which the Corporation and/or its subsidiaries are the only
members);

               (iv) all Taxes which the Sellers, the Corporation and each of its subsidiaries is (or was)
required by law to withhold or collect in connection with amounts paid or owing to any employee,
independent contractor, creditor, stockholder or other third party have been duly withheld or
collected, and have been timely paid over to the proper authorities to the extent due and
payable;

               (v) no written claim has ever been made by any taxing authority in a jurisdiction where the
Corporation does not file Tax Returns that the Corporation is or may be subject to taxation by
that jurisdiction;

               (vi) there are no tax sharing, allocation, indemnification or similar agreements in effect
as between the Corporation or any predecessor or affiliate thereof and any other party (including
the Sellers and any predecessors or affiliates thereof) under which the Purchaser or the
Corporation could be liable for any Taxes or other claims of any party after the Closing Date;

-13-

 

               (vii) the Corporation has not applied for, been granted, or agreed to any accounting
method change for which it will be required to take into account any adjustment under Section 481
of the Code or any similar provision of the Code or the corresponding tax laws of any nation,
state or locality;

               (viii) there are no deferred intercompany transactions between the Corporation and any of its
subsidiaries or between its subsidiaries and there is no excess loss account (within the meaning
of Treasury Regulations Section 1.1502-19 with respect to the stock of the Corporation) which will
or may result in the recognition of income upon the consummation of the transaction contemplated
by this Agreement;

               (ix) no indebtedness of the Corporation consists of “corporate acquisition indebtedness”
within the meaning of Section 279 of the Code; and

               (x) the Corporation has not been a “United States real property holding corporation” within
the meaning of Section 897(c)(2) of the Code at any time during the five year period ending on the
Closing Date; and

               (xi) the Corporation is not a party to any agreement that would require the Corporation or
any affiliate thereof to make any payment that would constitute an “excess parachute payment” for
purposes of Sections 280G and 4999 of the Code or that would not be deductible pursuant to Section
162(m) of the Code.

     2.14. Compliance with Law and Certifications.

          (a) The Corporation has operated in compliance with regard to its operations, practices,
real property, plants, structures, machinery, equipment and other property, employees, products
and services and all other aspects of its business, with all applicable Regulations and Orders,
including, without limitation, all Regulations relating to the safe conduct of business,
environmental protection, quality and labeling, antitrust, consumer protection, equal
opportunity, discrimination, health, sanitation, fire, zoning, building and occupational safety.
There are no Claims pending, or threatened, nor has the Corporation received any written notice,
regarding any violations of any Regulations or Orders enforced by any Authority claiming
jurisdiction over the Corporation.

          (b) The Corporation holds all material registrations, accreditations and other
certifications required for the conduct of its business by any Authority or trade group and the
Corporation has operated in compliance with the terms and conditions of all such registrations,
accreditations and certifications. The Corporation has not received any notice alleging that it
has failed to hold any such material registration, accreditation or other certification.

     2.15. ERISA and Related Matters.

          (a) List of Plans. Set forth in Schedule 2.15(a) attached hereto is an
accurate and complete list of all domestic and foreign (i) “employee benefit plans,” within the
meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended, and the
Regulations thereunder (“ERISA”); (ii) bonus, stock option, stock purchase,
restricted stock, incentive, fringe benefit, “voluntary employees’ beneficiary associations”
(“VEBAs”) under

-14-

 

Section 501(c )(9) of the Code, profit-sharing, pension or retirement, deferred
compensation, medical, life insurance, disability, accident, salary continuation, severance,
accrued leave, vacation, sick pay, sick leave, supplemental retirement and unemployment benefit
plans, programs, arrangements, commitments and/or practices (whether or not insured); and (iii)
employment, consulting, termination, and severance Contracts; in each case for active, retired or
former employees or directors, whether or not any such plans, programs, arrangements, commitments,
Contracts, agreements and/or practices (referred to in (i), (ii) or (iii) above) are in writing or
are otherwise exempt from the provisions of ERISA; that have been established, maintained or
contributed to (or with respect to which an obligation to contribute has been undertaken) or with
respect to which any potential liability is borne by the Corporation (including, for this purpose
and for the purpose of all of the representations in this Section 2.15, any predecessors to the
Corporation or any of its Subsidiaries and all employers (whether or not incorporated) that would
be treated together with the Corporation, and/or the Sellers as a single employer (1) within the
meaning of Section 414 of the Code, or (2) as a result of the Corporation or any Subsidiary and/or
the Sellers being or having been a general partner of any such employer), since September 2, 1974
(“Employee Benefit Plans”).

          (b) Status of Plans. Except as set forth in Schedule 2.15(b) attached
hereto, each Employee Benefit Plan (including any related trust) complies in form with the
requirements of all applicable Regulations, including, without limitation, ERISA, the Code, and
foreign tax, labor, securities, data privacy, currency exchange control and other Regulation, and
has at all times been maintained and operated in substantial compliance with its terms and the
requirements of all applicable Regulation, including, without limitation, ERISA and the Code. No
complete or partial termination of any Employee Benefit Plan has occurred or is expected to occur.
Neither the Corporation nor or any of its Subsidiaries has any commitment, intention or
understanding to create, modify or terminate any Employee Benefit Plan. Except as required to
maintain the tax-qualified status of any Employee Benefit Plan intended to qualify under Section
401(a) of the Code, no condition or circumstance exists that would prevent the amendment or
termination of any Employee Benefit Plan. No event has occurred and no condition or circumstance
has existed that could result in a material increase in the benefits under or the expense of
maintaining any Employee Benefit Plan from the level of benefits or expense incurred for the most
recent fiscal year ended thereof, and no benefits under any Employee Benefit Plan have been
increased subsequent to the date as of which documents have been provided.

          (c) No Pension Plans. No Employee Benefit Plan is an “employee pension benefit plan”
(within the meaning of Section 3(2) of ERISA) subject to Section 412 of the Code or Section 302 or
Title IV of ERISA. Neither the Corporation nor or any of its Subsidiaries has ever maintained or
contributed to, or had any obligation to contribute to (or borne any liability with respect to)
any “multiple employer plan” (within the meaning of the Code or ERISA) or any “multiemployer plan”
(as defined in Section 4001(a)(3) of ERISA). Neither the Corporation nor or any of its
Subsidiaries maintains or contributes to any VEBA.

          (d) Liabilities.

               (i) Neither the Corporation nor or any of its Subsidiaries maintains any Employee Benefit
Plan which is a “group health plan” (as such term is defined

-15-

 

in Section 607(1) of ERISA or Section 5000(b)(1) of the Code) that has not been administered
and operated in all respects in compliance with the applicable requirements of Part 6 of Subtitle
B of Title I of ERISA and Section 4980B of the Code and neither the Corporation nor or any of its
Subsidiaries is subject to any material liability, including, without limitation, additional
contributions, fines, taxes, penalties or loss of tax deduction as a result of such administration
and operation. No Employee Benefit Plan which is such a group health plan is a “multiple employer
welfare arrangement,” within the meaning of Section 3(40) of ERISA. Except as set forth in
Schedule 2.15(d) attached hereto, each Employee Benefit Plan that is intended to meet the
requirements of Section 125 of the Code meets such requirements, and each program of benefits for
which employee contributions are provided pursuant to elections under any Employee Benefit Plan
meets the requirements of the Code applicable thereto. The Corporation does not maintain any
Employee Benefit Plan which is an “employee welfare benefit plan” (as such term is defined in
Section 3(1) of ERISA) that has provided any “disqualified benefit” (as such term is defined in
Section 4976(b) of the Code) with respect to which an excise tax could be imposed.

               (ii) Neither the Corporation nor or any of its Subsidiaries maintains any Employee Benefit
Plan (whether qualified or non-qualified under Section 401(a) of the Code) providing for
post-employment or retiree health, life insurance and/or other welfare benefits and having
unfunded liabilities, and neither the Corporation nor or any of its Subsidiaries have any
obligation to provide any such benefits to any retired or former employees or active employees
following such employees’ retirement or termination of service. Neither the Corporation nor or any
of its Subsidiaries has any unfunded liabilities pursuant to any Employee Benefit Plan that is not
intended to be qualified under Section 401(a) of the Code. No Employee Benefit Plan holds as an
asset any interest in any annuity Contract, guaranteed investment Contract or any other investment
or insurance Contract, policy or instrument issued by an insurance company that, to the best
knowledge of the Sellers and the Corporation, is or may be the subject of bankruptcy,
conservatorship, insolvency, liquidation, rehabilitation or similar proceedings.

               (iii) Neither the Corporation nor or any of its Subsidiaries has incurred any liability for
any tax or excise tax arising under Chapter 43 of the Code, and no event has occurred and no
condition or circumstance has existed that could give rise to any such liability.

               (iv) There are no actions, suits, claims or disputes pending, or, to the best belief and
knowledge of the Corporation and the Sellers, threatened, anticipated or expected to be asserted
against or with respect to any Employee Benefit Plan or the assets of any such plan (other than
routine claims for benefits and appeals of denied routine claims). No civil or criminal action
brought pursuant to the provisions of Title I, Subtitle B, Part 5 of ERISA is pending, or to the
best knowledge of the Corporation and the Sellers threatened, anticipated, or expected to be
asserted against the Corporation or any fiduciary of any Employee Benefit Plan, in any case with
respect to any Employee Benefit Plan. No Employee Benefit Plan or any fiduciary thereof has been
the direct or indirect subject of an audit, investigation or examination by any governmental or
quasi-governmental agency.

          (e) Contributions. Full payment has been timely made of all amounts which the
Corporation or any of its Subsidiaries is required, under applicable law or under any Employee
Benefit Plan or any agreement relating to any Employee Benefit Plan to which the

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Corporation or any of its Subsidiaries is a party, to have paid as contributions or premiums
thereto as of the last day of the most recent fiscal year of such Employee Benefit Plan ended
prior to the date hereof or have been accrued on the Corporation’s Financial Statements. All such
contributions and/or premiums have been fully deducted for income tax purposes and no such
deduction has been challenged or disallowed by any governmental entity, and to the best knowledge
and belief of the Sellers and the Corporation and its Subsidiaries no event has occurred and no
condition or circumstance has existed that could give rise to any such challenge or disallowance.
The Corporation and each of its Subsidiaries have made adequate provision for reserves to meet
contributions and premiums and any other liabilities that have not been paid or satisfied because
they are not yet due under the terms of any Employee Benefit Plan, applicable law or related
agreements. Benefits under all Employee Benefit Plans are as represented and have not been
increased subsequent to the date as of which documents have been provided.

          (f) Tax Qualification. Each Employee Benefit Plan intended to be qualified under
Section 401(a) of the Code has, as currently in effect, been determined to be so qualified by the
Internal Revenue Service (or has submitted, or is within the remedial amendment period for
submitting an application for a determination letter with the Internal Revenue Service, and is
waiting receipt of a response). Each trust established in connection with any Employee Benefit
Plan which is intended to be exempt from Federal income taxation under Section 50l(a) of the Code
has, as currently in effect (or has submitted, or is within the remedial amendment period for
submitting an application for a determination letter with the Internal Revenue Service, and is
waiting receipt of a response), been determined to be so exempt by the Internal Revenue Service.
Since the date of each most recent determination referred to in this paragraph (f), no event has
occurred and no condition or circumstance has existed that resulted or is likely to result in the
revocation of any such determination or that could adversely affect the qualified status of any
such Employee Benefit Plan or the exempt status of any such trust.

          (g) Transactions. Neither the Corporation nor any of its Subsidiaries nor any of
their respective directors, officers, employees or, to the best belief and knowledge of the
Sellers and the Corporation, other persons who participate in the operation of any Employee
Benefit Plan or related trust or funding vehicle, has engaged in any transaction with respect to
any Employee Benefit Plan or breached any applicable fiduciary responsibilities or obligations
under Title I of ERISA that would subject any of them to a tax, penalty or liability for
prohibited transactions or breach of any obligations under ERISA or the Code or would result in
any claim being made under, by or on behalf of any such Employee Benefit Plan by any party with
standing to make such claim.

          (h) Triggering Events. Except as set forth on Schedule 2.15(h) attached
hereto or as provided in Section 1.8 of this Agreement, the execution of this Agreement and the
consummation of the transactions contemplated hereby, do not constitute a triggering event under
any Employee Benefit Plan, policy, arrangement, statement, commitment or agreement, whether or not
legally enforceable, which (either alone or upon the occurrence of any additional or subsequent
event) will or may result in any payment (whether of severance pay or otherwise), “parachute
payment” (as such term is defined in Section 280G of the Code), acceleration, vesting or increase
in benefits to any employee or former employee or director of the Corporation or any of its
Subsidiaries. Except as set forth on Schedule 2.15(h) attached hereto, no Employee Benefit

-17-

 

Plan provides for the payment of severance, termination, change in control or
similar-type payments or benefits.

          (i) Classification. The Corporation and its Subsidiaries have classified all
individuals who perform services for them correctly under each Employee Benefit Plan, ERISA, the
Code and other applicable law as common law employees, independent contractors or leased
employees.

          (j) Documents. The Sellers have delivered or caused to be delivered to Purchaser
and its counsel true and complete copies of all material documents in connection with
each Employee Benefit Plan, including, without limitation (where applicable): (i) all Employee
Benefit Plans as in effect on the date hereof, together with all amendments thereto, including,
in the case of any Employee Benefit Plan not set forth in writing, a written description
thereof; (ii) all current summary plan descriptions, summaries of material modifications, and
material
communications; (iii) all current trust agreements, declarations of trust and other
documents establishing other funding arrangements (and all amendments thereto and the
latest financial
statements thereof); (iv) the most recent IRS determination letter obtained with respect to each
Employee Benefit Plan intended to be qualified under Section 40l(a) of the Code or exempt under
Section 50l(a) or 50l(c)(9) of the Code; (v) the annual report on Internal Revenue Service
Form 5500-series for each of the last three years for each Employee Benefit Plan required to
file such form; (vi) the most recently prepared financial statements for each Employee
Benefit Plan for which such statements are required; and (vii) all Contracts relating to
each Employee Benefit Plan, including, without limitation, service provider agreements,
insurance Contracts, annuity Contracts, investment management Contracts, subscription
Contracts, participation Contracts, and record keeping Contracts and collective bargaining
Contracts.

     2.16. Intellectual Property.

          (a) Schedule 2.16(a) attached hereto is a complete and accurate list of all
domestic and foreign patents, patent applications, trademarks, service marks and other indicia
of origin, trademark and service mark registrations and applications for registrations thereof,
registered copyrights and applications for registration thereof, Internet domain names and URLs,
corporate and business names, trade names, brand names and material computer software programs
used or held for use in the business of the Corporation. To the extent indicated on such
schedule, the Intellectual Property listed on Schedule 2.16(a) attached hereto has been
duly registered in, filed in or issued by the United States Patent and Trademark Office, United
States Copyright Office, a duly accredited and appropriate domain name registrar, the
appropriate offices in the various states of the United States and the appropriate offices of
other jurisdictions (foreign and domestic), and each such registration, filing and issuance
remains in full force and effect as of the Closing Date. Copies of all items of the Corporation
Intellectual Property which have been reduced to writing or other tangible form have been
delivered by the Corporation to the Purchaser (including, without limitation true and complete
copies of all related licenses, and amendments and modifications thereto).

          (b) Except as set forth in Schedule 2.16(b) attached hereto, the Corporation is
not a party to any license or Contract, whether as licensor, licensee, or otherwise with
respect to any Intellectual Property. To the extent any Intellectual Property is used under
license in the

-18-

 

business of the Corporation, no notice of a material default has been sent or received by the
Corporation under any such license which remains uncured and the execution, delivery or
performance of the Corporation’s obligations hereunder will not result in such a default. Each
such license agreement is a legal, valid and binding obligation of the Corporation and each of the
other parties thereto, enforceable in accordance with the terms thereof.

          (c) Except as set forth in Schedule 2.l6(c) attached hereto, the Corporation and/or
its wholly-owned Subsidiaries owns or is licensed to use, all of the Corporation Intellectual
Property, free and clear of any Liens, Orders and other adverse Claims, without obligation to pay
any royalty or any other fees with respect thereto. The Corporation’s use of the Intellectual
Property (including, without limitation, the manufacturing, marketing, licensing, sale or
distribution of products and the general conduct and operations of the business of the
Corporation) does not violate, infringe, misappropriate or misuse any intellectual property rights
of any third party. None of the Corporation Intellectual Property has been cancelled, abandoned or
otherwise terminated and all renewal and maintenance fees in respect thereof have been duly paid.
There are no actions that must be taken or payments that must be made by the Corporation within
180 days following the Closing Date that, if not taken, will adversely affect the Corporation
Intellectual Property. The Corporation has the exclusive right to file, prosecute and maintain all
applications and registrations with respect to the Intellectual Property that is owned by the
Corporation.

          (d)
 Except as set forth in Schedule 2.16(d) attached hereto, the Corporation has not
received any written notice or Claim from any third party challenging the right of the Corporation
to use any of the Intellectual Property. The Corporation Intellectual Property constitutes all the
Intellectual Property necessary to operate the business of the Corporation as of the Closing Date
and thereafter, in the manner in which it is presently operated.

          (e) Except as set forth in Schedule 2.16(e) attached hereto, the Corporation has not
made any Claim in writing of a violation, infringement, misuse or misappropriation by any third
party (including, without limitation, any employee or former employee of the Corporation) of its
rights to, or in connection with any Intellectual Property, which Claim is still pending. Except
as set forth in Schedule 2.16(e) attached hereto, the Corporation has not entered into any
Contract to indemnify any other Person against any charge of infringement of any Intellectual
Property, other than indemnification provisions contained in purchase orders or license agreements
arising in the ordinary course of business.

          (f) Except as set forth in Schedule 2.16(f) attached hereto, to the best knowledge of
the Corporation, there is no pending or threatened Claims by any Person or Authority of a
violation, infringement, misuse or misappropriation by the Corporation of any Intellectual
Property owned by any third party, or of the invalidity of any patent or registration of a
copyright, trademark, service mark, domain name, or trade name included in the Corporation
Intellectual Property. To the best knowledge of the Corporation, the Corporation does not know of
any valid basis for any such Claims.

          (g) 
Except as set forth in Schedule 2.16(g) attached hereto, there are no
interferences or other contested proceedings, either pending or, to the best knowledge of
the
Corporation, threatened, in the United States Copyright Office, the United States Patent and

-19-

 

Trademark Office, or any governmental Authority (foreign or domestic) relating to any
pending application with respect to the Corporation Intellectual Property.

          (h) the Corporation has secured valid written assignments from all Persons (including,
without limitation, consultants and employees) who contributed to the creation or development
of the Corporation Intellectual Property of the rights to such contributions that the
Corporation does not already own by operation of law.

          (i) the Corporation has taken all necessary and reasonable steps to protect and preserve
the confidentiality of all trade secrets, know-how, source codes, databases, customer
lists, schematics, ideas, algorithms and processes and all use, disclosure or appropriation
thereof by or to any third party has been pursuant to the terms of a written agreement between
such third party and the Corporation. The Corporation has not breached any Contracts of
non-disclosure or confidentiality.

          (j) Except as set forth in Schedule 2.16(j) attached hereto, for the twelve month
period prior to the Closing Date, the Internet domain names and URLs of the Corporation
Intellectual Property (together with any content and other materials accessible and/or displayed
thereon, the “Sites”) direct and resolve to the appropriate Internet protocol addresses
and are and have been maintained and accessible to Internet users on those certain computers
used by the Corporation to make the Sites so accessible (the “Server”) approximately
twenty-four (24) hours per day, seven (7) days per week (“24/7”) and are and have been
operational for downloading content from the Server on a 24/7 basis.

     2.17. Environmental Matters.

          (a) The Corporation has operated in compliance with all applicable Environmental Laws and
the terms and conditions of permits issued under such Environmental Laws with respect to any
property owned, leased or occupied by it.

          (b) There are no pending or, to the knowledge of the Corporation or the Sellers,
threatened environmental Claims against the Corporation or, to the knowledge of the
Corporation or the Sellers, any property owned, leased or occupied by the Corporation.

          (c) There are no facts, circumstances, conditions or occurrences on any property owned,
leased or occupied by the Corporation that could reasonably be anticipated (i) to form a basis
of an environmental Claim against the Corporation, including without limitation any Claim
related to the release of Hazardous Substances or (ii) to cause such property or any of the
Corporation’s assets to be subject to any restrictions on the ownership, occupancy, use or
transferability thereof under any applicable Environmental Law.

     2.18. Capital Expenditures and Investments. The Corporation has outstanding
Contracts and a budget for capital expenditures and investments as set forth in
Schedule 2.18 attached hereto which includes a schedule of all monies disbursed on
account of capital expenditures and investments made by the Corporation since the Financial
Statement Date.

     2.19. Dealings with Affiliates. Schedule 2.19 attached hereto sets forth a
complete and accurate list and description of the economic terms, including the parties, of all
Contracts to

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which the Corporation is, will be or has been a party, at any time from November 3, 2003 to the
Closing Date, and to which anyone or more of (a) the Sellers, (b) the Corporation’s Affiliates,
(c) a Seller’s Affiliate, or (d) any Person in which a Seller, an Affiliate of the Corporation or
a Seller has, directly or indirectly, made an Investment, is also a party. Except as set forth on
Schedule 2.19 attached hereto, since November 3,2003, the Corporation has not made any
payments, loaned or borrowed any funds or property or made any credit arrangement or accommodation
with any Seller, Affiliate or employee of the Corporation except for the payment of employee
salaries and director compensation in the ordinary course of business.

     2.20. Insurance. The Corporation and its Subsidiaries do not have or maintain
any insurance Policies.

     2.21. Customers and Suppliers. Schedule 2.21 attached hereto sets forth a
complete and accurate list of (a) each customer that accounted for more than 5% of the
consolidated revenues and/or income of the Corporation during the last full fiscal year and the
interim period through February 28, 2005 and the amount of revenues accounted for by such customer
during each such period and (b) each supplier that is the sole supplier of any significant product
or component to the Corporation. No material customer of the Corporation has advised the
Corporation in writing within the past year that it will stop, or decrease the rate of, buying
materials, products or services from the Corporation. No unfilled customer order or commitment
obligating the Corporation to process, manufacture or deliver products or perform services will
result in an anticipated loss to the Corporation upon completion of performance. No material
supplier of the Corporation has advised the Corporation in writing within the past year that it
will stop, or decrease the rate of, supplying materials, products, or services to the Corporation.
The consummation of the transactions contemplated hereby will not have a material adverse effect
on the Corporation’s relationship with any customer or supplier listed on Schedule 2.21
attached hereto.

     2.22. Permits. The Permits listed on Schedule 2.22 attached hereto are the
only Permits that have been required for the Corporation to conduct its business in accordance
with applicable Regulations and Orders of any Authority. The Corporation has duly and validly
held all such
Permits, and each such Permit has been in full force and effect and, to the best of the knowledge
of the Corporation, no suspension or cancellation of any such Permit is threatened and there is no
basis for believing that such Permit will not be renewable upon expiration.

     2.23. Improper and Other Payments. Except as set forth on Schedule 2.23
attached hereto, neither the Corporation nor any of its Subsidiaries, nor any director, officer,
agent, representative, employee or other person acting on behalf of the Corporation or any of
its Subsidiaries has, directly or indirectly, in the course of its actions for, or on behalf of,
the Corporation or any of its Subsidiaries, (a) made, paid or received any unlawful bribes,
rebates, payoffs, influence payments, kickbacks or any other similar unlawful payments to or
from any Person or Authority, (b) used any corporate funds for any unlawful contribution, gift,
entertainment or other unlawful expenses relating to political activity, (c) made any direct or
indirect unlawful payment to any foreign or domestic government official or employee from
corporate funds, and (d) made any improper foreign payment (as defined in the Foreign Corrupt
Practices Act of 1977, as amended). The internal accounting controls of the Corporation are

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believed by the Corporation’s management to be adequate to detect any of the foregoing under
current circumstances.

     2.24. Securities Laws Matters. Each Seller is acquiring the Purchaser Common Stock
hereunder for his own account for investment and not with a view to, or for the sale in connection
with, any “distribution” of the Purchaser Common Stock, as such term is used in Section 2(11) of
the Securities Act. Each Seller has had the opportunity to discuss the transactions contemplated
hereby with the Purchaser and has been afforded, prior to execution of this Agreement, the
opportunity to ask questions of, and receive answers from the Purchaser and to obtain any
additional information relating to the transactions contemplated hereby as such Seller has
requested. Each Seller is an “accredited investor” within the meaning of Regulation D promulgated
under the Securities Act and has such knowledge and experience in business or financial matters
that he is capable of evaluating the merits and risks of an investment in the Purchaser Common
Stock. Each Seller can bear the economic risk of losing his investment in the Purchaser Common
Stock and has adequate means for providing for his current financial needs and contingencies. Each
Seller acknowledges and agrees that the Purchaser Common Stock will be “restricted securities”
within the meaning of Rule 144 and can not be sold or otherwise disposed of, except (a) pursuant
to an exemption from the registration requirements under applicable state securities laws and the
Securities Act, (b) in accordance with Rule 144 or (c) pursuant to an effective registration
statement filed by the Purchaser with the Securities and Exchange Commission under applicable
state securities laws and the Securities Act. Each Seller is a resident of, and the Purchaser
Common Stock will come to rest, in the states set forth in the addresses on the signature pages
hereto. Each Seller acknowledges and agrees that the Purchaser may, unless a registration
statement is in effect covering such Purchaser Common Stock or unless the holders thereof comply
with Rule 144, place stop transfer orders with its transfer agent with respect to such
certificates in accordance with federal securities laws.

     2.25. Legend. Each Seller acknowledges and agrees that each certificate evidencing
the Purchaser Common Stock and each certificate issued in exchange therefor or upon the transfer
of any Purchaser Common Stock shall be stamped or otherwise imprinted with a legend in
substantially the following form:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
AN EXEMPTION FROM REGISTRATION THEREUNDER. A COPY OF SUCH AGREEMENT MAY BE OBTAINED
BY THE HOLDER HEREOF AT THE CORPORATION’S PRINCIPAL PLACE OF BUSINESS WITHOUT
CHARGE.”

     2.26. Private Placement Memorandum. None of the information supplied or to be
supplied by or on behalf of the Corporation or any of its Affiliates or Subsidiaries (including
the entities included in the Restructuring pursuant to Section 5.17) for inclusion or
incorporation by reference in the Private Placement Memorandum will contain any untrue statement
of a material fact or omit to state any material fact necessary in order to make the statements
therein, in light

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of the circumstances under which they were made, not misleading; provided that no
representation or warranty is made by the Corporation or any of its Affiliates or Subsidiaries
(including the entities included in the Restructuring pursuant to Section 5.17) with respect to
statements made or incorporated by reference in the Private Placement Memorandum based on
information by the Purchaser or Acquisition for inclusion or incorporation by reference therein.

     2.27. Board Approval. The Board of Directors of the Corporation, by unanimous
written consent or by resolutions duly adopted by unanimous vote of those voting at a
meeting duly called and held and not subsequently rescinded or modified in any way (the
“Corporation Board Approval”), has duly authorized (a) this Agreement, the Merger and the
transactions contemplated hereby and thereby, (b) an amendment to the articles of incorporation
of the Corporation, and (c) the appointment of certain directors to the Corporation Board of
Directors as set forth on Schedule 1.7(a) attached hereto. The Corporation Board Approval
constitutes approval of this Agreement and the Merger for purposes of Sections 607.0821 and
607.1103 of the FBCA Article II of the by-laws of the Corporation.

     2.28. Shareholders’ Approval. On or prior to the Closing Date and after the
Restructuring has been consummated, the shareholders of the Corporation will approve in
accordance with the FBCA by resolutions duly adopted by a written consent or a vote of a majority
of the Corporation’s shareholders entitled to vote at a meeting duly called and held and not
subsequently rescinded or modified in any way this Agreement, the Merger and the transactions
contemplated hereby and thereby (the “Corporation Shareholders’ Approval”).

     2.29. Banks. (i) the name of each bank, trust company or other financial institution
and stock or other broker with which the Corporation has an account, credit line or safe deposit
box or vault, (ii) the names of all persons authorized to draw thereon or to have access to any
safe deposit box or vault, (iii) the purpose of each such account, safe deposit box or vault, and
(iv) the names of all persons authorized by proxies, powers of attorney or other like instrument
to act on behalf of the Corporation in matters concerning any of its business or affairs is set
forth on Schedule 2.29 attached hereto. No such proxies, powers of attorney or other like
instruments are irrevocable.

     2.30. Disclosure. Neither this Agreement nor any of the Contracts, exhibits,
attachments, written statements, documents, certificates or other items prepared for or supplied
to the Purchaser by or on behalf of the Corporation or the Sellers with respect to the
transactions contemplated hereby contains any untrue statement of a material fact or omits a
material fact necessary to make each statement contained herein or therein not misleading. There
is no fact which the Sellers or the Corporation has not disclosed to the Purchaser herein and of
which the Sellers or the Corporation, or any of their respective officers, directors or executive
employees is aware which could reasonably be anticipated to have a Material Adverse Effect on the
Corporation or the ability of the Purchaser to continue the businesses of the Corporation in the
same manner as the Corporation conducted its business prior to the Closing Date.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

          The Purchaser represents and warrants to the Sellers and the Corporation as follows as of
the date hereof and as of the Closing Date:

     3.1. Corporate Organization, Etc. The Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of its jurisdiction of incorporation with
full corporate power and authority to carryon its business as it is now being conducted and to
own, operate and lease its properties and assets. The Purchaser is duly qualified or licensed to
do business and is in corporate and Tax good standing in every jurisdiction in which the conduct
of its business, the ownership or lease of its properties, require it to be so qualified or
licensed.

     3.2. Authorization, Etc. The Purchaser has full power and authority to enter into
this Agreement and the agreements contemplated hereby to which the Purchaser is a party and to
consummate the transactions contemplated hereby and thereby. The execution, delivery and
performance of this Agreement and all other agreements and transactions contemplated hereby have
been duly authorized by the Board of Directors and prior to the Closing will be authorized by the
shareholders of the Purchaser and no other corporate proceedings on its part are necessary to
authorize this Agreement and the agreements contemplated hereby and the transactions
contemplated hereby and thereby. This Agreement and all other agreements contemplated hereby to be
entered into by the Purchaser each constitutes a legal, valid and binding obligation of the
Purchaser enforceable against the Purchaser in accordance with its terms.

     3.3. No Violation. Except as set forth in Schedule 3.3 attached hereto, the
execution, delivery and performance by the Purchaser of this Agreement, and all other agreements
contemplated hereby, and the fulfillment of and compliance with the respective terms hereof and
thereof by the Purchaser, do not and will not (a) conflict with or result in a breach of the
terms,
conditions or provisions of, (b) constitute a default or event of default under (whether with
or without due notice, the passage of time or both), (c) result in a violation of, or (d)
require any authorization, consent, approval, exemption or other action by, or notice to, or
filing with any third party or Authority pursuant to, the charter or bylaws of the Purchaser
or any applicable
Regulation, Order or Contract to which the Purchaser or its properties are subject. The Purchaser
has complied with all applicable Regulations and Orders in connection with its execution, delivery
and performance of this Agreement, the agreements contemplated hereby and the transactions
contemplated hereby and thereby.

     3.4. Investment Intent. The Purchaser is purchasing the Shares for investment
purposes and not with a view to distribution thereof and agrees that it will not make any
sale, transfer or other disposition of the Shares in violation of any applicable securities
law.

     3.5. Capitalization. The authorized, issued and outstanding capital stock, Options,
and securities that are convertible into, or exchangeable for, capital stock of the Purchaser on a
fully diluted basis as of the date hereof, and without giving effect to any of the transactions
contemplated hereby, are held beneficially and of record by the Persons as set forth in
Schedule 3.5(a) attached hereto. The Purchaser does not have any Contracts containing any

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profit participation features, stock appreciation rights or phantom stock options, or
similar Contracts that allow any Person to participate in the equity of the Purchaser except as
set forth on Schedule 3.5(a) attached hereto. The Purchaser is not subject to any
obligation or Contract (contingent or otherwise) to repurchase or otherwise acquire or retire any
shares of its capital stock or any Options. All of the outstanding shares of the Purchaser’s
capital stock are validly issued, fully paid and non-assessable. There are no shares of capital
stock of the Purchaser held in the treasury of the Purchaser and no shares of capital stock of the
Purchaser are currently reserved for issuance for any purpose or upon the occurrence of any event
or condition. There are no existing Contracts or Options between a shareholder of the Purchaser,
on the one hand, and any other Person, on the other hand, regarding the Purchaser’s capital stock.
Except as set forth in Schedule 3.5(b) attached hereto, there are no Contracts between or
among any of the Purchaser’s shareholders or any other Persons that are binding upon the Purchaser
with respect to the voting, transfer, encumbrance of the Purchaser’s capital stock or Options to
acquire capital stock or securities that are exchangeable or convertible into capital stock of the
Purchaser or with respect to any aspect of Purchaser’s governance or dividends or distributions.
The stock record books of the Purchaser that have been delivered to the Purchaser for inspection
prior to the date hereof are complete and correct in all material respects. As of the date hereof,
the authorized capital stock of the Purchaser consists solely of 100,000,000 shares of the
Purchaser Common Stock, of which 100,000,000 shares of the Purchaser Common Stock are currently
issued and outstanding. Prior to the Closing Date, Tamborine Majority Shareholder pursuant to
Section 5.14 shall cause 94,000,000 shares of issued and outstanding Purchaser Common Stock to be
forfeited and returned to the treasury of the Purchaser and cancelled, so that at the Closing Date
and prior to issuance of the Merger Consideration, not more than 6,000,000 shares of the Purchaser
Common Stock shall be issued and outstanding. At the Effective Time, assuming (i) the maximum
number of shares have been sold pursuant to the Private Placement and (ii) 94,000,000 shares of
issued and outstanding Purchaser Common Stock has been forfeited to the Purchaser pursuant to
Section 5.14, the
authorized capital stock of the Purchaser shall consist of 100,000,000 shares of the Purchaser
Common Stock of which 29,050,000 shares of the Purchaser Common Stock shall be issued and
outstanding and 1,000,000 shares of the Purchaser Common Stock will be subject to a stock option
plan to be adopted and implemented by the Purchaser as soon as practicable after the Closing Date
(the “Purchaser Stock Option Plan”). All offers and sales of capital stock of the
Purchaser prior to the date of this Agreement were, at all relevant times, duly registered or
exempt from the registration requirements of the Securities Act and were duly registered or
subject to an available exemption from the registration requirements of the applicable state
securities or blue sky laws, as the case may be. The shares of the Purchaser Common Stock
comprising the Merger Consideration (excluding, without limitation, any shares issuable pursuant
to the Purchaser Stock Option Plan) will be issued in material compliance (assuming each recipient
of the Purchaser Common Stock as Merger Consideration is an “accredited investor” and has
otherwise complied in all material respects with the applicable state and federal securities laws)
with the registration and qualification requirements of all applicable state and federal
securities laws.

     3.6. Books and Records. The corporate minute books of the Purchaser that have been
made available to the Purchaser for inspection are complete and correct in all material respects
and contain all of the proceedings of the shareholders and directors of the Purchaser. A true and
complete list of the incumbent directors and officers of the Purchaser is set forth in
Schedule 3.6 attached hereto. Neither the Purchaser nor Acquisition has any of its
records, systems, controls,

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data or information recorded, stored, maintained, operated or otherwise wholly or partly
dependent upon or held by any means (including any electronic, mechanical or photographic process,
whether computerized or not) which (including all means of access thereto and therefrom) are not
under the exclusive ownership and direct control of the Purchaser or a wholly-owned Subsidiary.

     3.7. Acquisition. Acquisition is the only Subsidiary of the Purchaser, was formed
solely for the purpose of engaging in the transactions contemplated hereby, has engaged in no
other business activities and has conducted its operations only as contemplated hereby. As of the
date hereof, the Purchaser does not have any joint ventures.

     3.8. Operations of Purchaser and Acquisition. Since December 31, 2004, the
Purchaser (i) has not engaged in any business activities of any type whatsoever, except with
respect to its maintenance as a public company and except as in furtherance of this Agreement and
the transactions contemplated hereby, (ii) does not own any properties or other assets, (iii) has
less than $100 of cash (or cash equivalents) and has no material liabilities, whether fixed,
accrued or contingent, and (iv) is not a party to or bound by any contract, commitment, agreement
or understanding (whether written or oral), except for this Agreement, any subscription or other
documents in connection with the Private Placement. The Purchaser and Acquisition do not have any
paid employees. At the Effective Time, the Purchaser shall have no liabilities other than up to
an aggregate amount equal to $100,000 in fees, expenses or disbursements incurred in connection
with this Agreement, the Merger, the Private Placement and the consummation of the transactions
contemplated hereby and thereby.

     3.9. Financial Condition and Reports.

          (a) Attached as Schedule 3.9(a) attached hereto are the Purchaser’s Form 15c2-11,
which presents fairly the financial condition, assets, liabilities, and shareholders’ equity of
the Purchaser as of the date thereof; each such statement of income and statement of retained
earnings presents fairly and accurately the results of operations of the Purchaser for the period
indicated; and each such statement of changes in financial position presents fairly and
accurately the information purported to be shown therein.

          (b) As of the date hereof and except as set forth in the Purchaser’s Form 15c2-11, Section
3.8, the Purchaser and Acquisition have no liabilities or obligations of any nature
(whether asserted, unasserted, accrued, unaccrued, absolute, fixed, contingent, liquidated,
unliquidated, due, to become due, or otherwise), and there is no fact, condition or circumstance
which could reasonably be expected to result in such liabilities or obligations. The Purchaser and
Acquisition have filed all necessary federal, state and foreign income and franchise Tax Returns
due prior to the date of this Agreement and have paid all Taxes shown as due thereon. There are no
unpaid Taxes claimed to be due by the Taxing Authority of any jurisdiction, and the officers of
the Purchaser know of no basis for such claim. The properties and assets of the Purchaser and
Acquisition are owned by the Purchaser free and clear of all Liens.

          (c) The Purchaser has filed all forms, reports and documents with the SEC and applicable
state laws and regulations required to be filed by it pursuant to the federal and state
securities laws, and SEC rules and regulations thereunder, and all such forms, reports and

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documents, as amended, filed with the SEC or any secretary of state have complied with all
applicable requirements of the federal and state securities laws and the SEC rules and
regulations promulgated thereunder.

     3.10. Contracts. As of the Closing Date, the Purchaser and Acquisition are only
party to the Contracts set forth in Schedule 3.10 attached hereto. Each of the Purchaser
and Acquisition has performed in all material respects all obligations required to be performed by
it and is not in default in any respect under or in breach of nor in receipt of any Claim of
default or breach under any material Contract to which the Purchaser or Acquisition is subject
(including without limitation all performance bonds, warranty obligations or otherwise); no event
has occurred which with the passage of time or the giving of notice or both would result in a
default, breach or event of non-compliance under any material Contract to which the Purchaser or
Acquisition is subject (including without limitation all performance bonds, warranty obligations
or otherwise); each of the Purchaser and Acquisition does not have any present expectation or
intention of not fully performing all such obligations; each of the Purchaser and Acquisition does
not have any knowledge of any breach or anticipated breach by the other Persons to any such
Contract to which it is a party. The Purchaser and Acquisition have delivered to the Corporation
true and complete copies of all the Contracts and documents listed in the schedules to this
Agreement.

     3.11. Title and Related Matters.

          (a) Except as set forth in Schedule 3.11(a) attached hereto, the Purchaser has good
and marketable title to all real and personal, tangible and intangible, property and other assets
reflected in the Financial Statements or acquired after the Financial Statement Date, free and
clear of all Liens, except Permitted Liens. All properties used in the Purchaser’s business
operations for the periods covered by the Financial Statements are reflected in the Financial
Statements, except as to those assets that are leased. Schedule 3.11 (b) attached hereto
sets forth a complete and accurate summary of all leased assets that have annual rental payments
in excess of $12,000, describing the expiration date of such lease, the name of the lessor, the
annual rental payment and whether a consent is required from the lessor to consummate the
transactions contemplated hereby.

          (b) All the Purchaser’s leases are in full force and effect, and valid and enforceable in
accordance with their respective terms. The Purchaser has not received any notice of any, and
there exists no event of default or event which constitutes or would constitute (with notice or
lapse of time or both) a default by the Purchaser or any other Person under any lease. All rent
and other amounts due and payable with respect to the Purchaser’s leases have been paid through
the date of this Agreement and all rent and other amounts due and payable with respect to the
Purchaser’s leases that are due and payable on or prior to the Closing Date will have been paid
prior to the Closing Date. All lessors under the Purchaser’s real property leases have consented
(where such consent is necessary) or prior to the Closing will have consented (where such consent
is necessary) to the consummation of the transactions contemplated by this Agreement without
requiring material modification in the rights or obligations thereunder. The Purchaser has
received no written notice that the landlord with respect to any real property lease would refuse
to renew such lease upon expiration of the period thereof upon substantially the same terms,
except for rent increases consistent with past experience or market rentals.

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          (c) None of the assets belonging to the Purchaser is or will be on the Closing Date subject
to any (i) Contracts of sale or lease except as set forth in Schedule 3.11(c) attached
hereto, except Contracts for the sale of inventory in the ordinary and regular course of
business
or (ii) Liens, except for Permitted Liens and the Liens set forth in Schedule 3.11(d)
attached hereto.

     3.12. Litigation. Schedule 3.12 attached hereto sets forth a true and
complete list of all Claims and Orders involving the Purchaser since May 28, 2004. Except as set
forth in Schedule 3.12 attached hereto, to the best knowledge of the Purchaser, there is
no Claim or Order
threatened against the Purchaser nor is there any reasonable basis therefor. Except as set forth
on Schedule 3.12 attached hereto, the Purchaser is fully insured with respect to each of
the matters set forth on Schedule 3.12 attached hereto and the Purchaser has not received
any opinion or a memorandum or advice from legal counsel to the effect that it is exposed, from a
legal standpoint, to any liability or obligations which could have an adverse effect in excess of
$10,000.

     3.13. Tax Matters.

          (a) Tax Returns. The Purchaser has timely filed or caused to be timely filed with
the appropriate taxing authorities all Tax Returns that are required to be filed by, or with
respect to, the Purchaser on or prior to the Closing Date. Such Tax Returns have been correct and
complete in all material respects.

          (b) Payment of Taxes. All Taxes and Tax liabilities due by or with respect to the
income, assets or operations of the Purchaser for all taxable years or other taxable periods that
end on or before the Closing Date and, with respect to any taxable year or other taxable period
beginning on or before and ending after the Closing Date, the portion of such taxable year or
period ending on and including the Closing Date (“Pre-Closing Period”) have been timely
paid or will be timely paid in full on or prior to the Closing Date or accrued and adequately
disclosed and fully provided for in accordance with GAAP on the Financial Statements.

          (c) Except as set forth in Schedule 3.13(c) attached hereto,

               (i) the Purchaser has not been the subject of an audit or other examination of Taxes by the
tax authorities of any nation, state or locality; (ii) no such audit is contemplated or pending;
and (iii) the Purchaser has not received any written notices from any taxing authority relating to
any issue which could affect the Tax liability of the Purchaser;

               (ii) the Purchaser, as of the Closing Date, (A) has not entered into an agreement or waiver
or been requested to enter into an agreement or waiver extending any statute of limitations
relating to the payment or collection of Taxes of the Purchaser that has not expired, or (B) is
not presently contesting the Tax liability of the Purchaser before any court, tribunal or agency;

               (iii) the Purchaser has not been included in any “consolidated”, “unitary” or “combined” Tax
Return provided for under the law of the United States, any foreign jurisdiction or any state or
locality with respect to Taxes for any taxable period for which the

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statute of limitations has not expired (other than a group of which the Purchaser and/or
its subsidiaries are the only members);

               (iv) all Taxes which the Purchaser is (or was) required by law to withhold or collect in
connection with amounts paid or owing to any employee, independent contractor, creditor,
stockholder or other third party have been duly withheld or collected, and have been timely paid
over to the proper authorities to the extent due and payable;

               (v) no written claim has ever been made by any taxing authority in a jurisdiction where the
Purchaser does not file Tax Returns that the Purchaser is or may be subject to taxation by that
jurisdiction;

               (vi) there are no tax sharing, allocation, indemnification or similar agreements in effect as
between the Purchaser or any predecessor or affiliate thereof and any other party under which the
Purchaser or the Corporation could be liable for any Taxes or other claims of any party after the
Closing Date;

            
   (vii) the Purchaser has not applied for, been
granted, or agreed to any accounting method change for which it will be required to take into account any adjustment under
Section 481 of the Code or any similar provision of the Code or the corresponding tax laws of any
nation, state or locality;

               (viii) there are no deferred intercompany transactions between the Purchaser and any of its
subsidiaries and there is no excess loss account (within the meaning of Treasury Regulations
Section 1.1502-19 with respect to the stock of the Purchaser) which will or may result in the
recognition of income upon the consummation of the transaction contemplated by this Agreement;

               (ix) no indebtedness of the Purchaser consists of “corporate acquisition indebtedness” within
the meaning of Section 279 of the Code; and

               (x) the Purchaser has not been a “United States real property holding corporation” within
the meaning of Section 897(c)(2) of the Code at any time during the five year period ending on
the Closing Date; and

               (xi) the Purchaser is not a party to any agreement that would require the Purchaser or any
affiliate thereof to make any payment that would constitute an “excess parachute payment” for
purposes of Sections 280G and 4999 of the Code or that would not be deductible pursuant to
Section 162(m) of the Code.

     3.14. Compliance with Law and Certifications.

          (a) The Purchaser has operated in compliance with regard to its operations, practices, real
property, plants, structures, machinery, equipment and other property, employees, products and
services and all other aspects of its business, with all applicable Regulations and Orders,
including, without limitation, all Regulations relating to the safe conduct of business,
environmental protection, quality and labeling, antitrust, consumer protection, equal
opportunity,

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discrimination, health, sanitation, fire, zoning, building and occupational safety. There are no
Claims pending, or threatened, nor has Purchaser received any written notice, regarding any
violations of any Regulations or Orders enforced by any Authority claiming jurisdiction over the
Purchaser.

          (b) The Purchaser holds all material registrations, accreditations and other
certifications required for the conduct of its business by any Authority or trade group and
the Purchaser has operated in compliance with the terms and conditions of all such
registrations,
accreditations and certifications. The Purchaser has not received any notice alleging that it
has failed to hold any such material registration, accreditation or other certification.

     3.15. Intellectual Property. The Purchaser does not own any Intellectual Property.

     3.16. Dealings with Affiliates. Schedule 3.16 attached hereto sets forth a
complete and
accurate list and description of the economic terms, including the parties, of all
Contracts to which the Purchaser is, will be or has been a party, at any time from May 28, 2004
to the Closing Date, and to which anyone or more of (a) the Purchaser’s Affiliates, or (b) any
Person in which
an Affiliate of the Purchaser has, directly or indirectly, made an Investment, is also a party.
Since May 28, 2004, the Purchaser has not made any payments, loaned or borrowed any funds or
property or made any credit arrangement or accommodation with any Affiliate of the Purchaser
except for the payment of employee salaries and director compensation in the ordinary course of
business.

     3.17. Insurance. The Purchaser has had, and through the Closing Date will have,
Policies in full force and effect that provide for coverages that are usual and customary as to
amount and scope in the business of the Purchaser. All of the Policies have been in full force
and effect, all premiums with respect thereto covering all periods up to and including the
Closing Date have been paid or accrued therefor, and no notice of cancellation or termination
has been received with respect to any Policy. Schedule 3.17 attached hereto sets forth a
complete and accurate summary of all Policies, including name of insurer, the types, dates and
amounts of coverage, any material coverage exclusion and a statement of the Claims paid out, and
Claims pending, as to each Policy for each of the last three (3) full fiscal years and any
interim period. The Purchaser has not breached or otherwise failed to perform in any material
respect its obligations under any of the Policies nor has the Purchaser received any adverse
notice or communication from any of the insurers party to the Policies with respect to any such
alleged breach or failure in connection with any of the Policies. All Policies are sufficient
for compliance with all Regulations and all Contracts to which the Purchaser is subject, are to
the Purchaser’s knowledge valid, outstanding, collectible and enforceable policies, and will not
in any way be affected by, or terminate or lapse by reason of, the execution and delivery of
this Agreement or the consummation of the transactions contemplated hereby. Except as set forth
in Schedule 3.17 attached hereto, all of the Policies remain in full force and effect
through thirty (30) days after the Closing Date. The Purchaser has not during the last five (5)
years been refused any insurance with respect to its assets or operations, nor has coverage ever
been limited by any insurance carrier to which the Purchaser has applied for any Policy or with
which it has carried a Policy.

     3.18. Permits. The Permits listed on Schedule 3.18 attached hereto are the
only Permits that have been required for the Purchaser to conduct its business in accordance
with applicable

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Regulations and Orders of any Authority. The Purchaser has duly and validly held all such
Permits, and each such Permit has been in full force and effect and, to the best of the knowledge
of the Purchaser, no suspension or cancellation of any such Permit is threatened and there is no
basis for believing that such Permit will not be renewable upon expiration.

     3.19. Improper and Other Payments. Except as set forth on Schedule 3.19
attached hereto, neither the Purchaser nor any of its Subsidiaries, nor any director, officer,
agent, representative, employee or other person acting on behalf of the Purchaser or any of its
Subsidiaries has, directly or indirectly, in the course of its actions for, or on behalf of, the
Purchaser or any of its Subsidiaries, (a) made, paid or received any unlawful bribes, rebates,
payoffs, influence payments, kickbacks or other unlawful payments to or from any Person or
Authority, (b) used any corporate funds for any unlawful contribution, gift, entertainment or
other unlawful expenses relating to political activity, (c) made any direct or indirect unlawful
payment to any foreign or domestic government official or employee from corporate funds, and (d)
made any improper foreign payment (as defined in the Foreign Corrupt Practices Act of 1977, as
amended). The internal accounting controls of the Purchaser are believed by the Purchaser’s
management to be adequate to detect any of the foregoing under current circumstances.

     3.20. Private Placement Memorandum. None of the information supplied or to be
supplied by or on behalf of each of the Purchaser and Acquisition for inclusion or incorporation
by reference in the Private Placement Memorandum will contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not misleading; provided that
no representation or warranty is made by each of the Purchaser and Acquisition with respect to
statements made or incorporated by reference in the Private Placement Memorandum based on
information by the Corporation or any of its Affiliates or Subsidiaries (including the entities
included in the Restructuring pursuant to Section 5.17) for inclusion or incorporation by
reference therein. The Private Placement Memorandum and any other documents to be filed with the
SEC or any other Authority in connection with the Merger and other transactions contemplated
hereby will comply as to form in all material respects with the provisions of the Securities Act
and the Exchange Act and the rules and regulations thereunder.

     3.21. Board Approval. The Board of Directors of the Purchaser, by unanimous written
consent or by resolutions duly adopted by unanimous vote of those voting at a meeting duly called
and held and not subsequently rescinded or modified in any way (the “Purchaser Board
Approval”), has duly authorized (a) this Agreement, the Merger and the transactions
contemplated hereby and thereby, (b) an amendment to the articles of incorporation of the
Purchaser, (i) amending its corporate purpose, and (ii) changing its corporate name, and ( c) the
appointment of certain directors to Purchaser Board of Directors as set forth on Schedule
1.7(a) attached hereto. The Purchaser Board Approval constitutes approval of this Agreement
and the Merger for purposes of Sections 79-4-8.21 and 79-4-11.02 of the Mississippi Business
Corporation Act (the “MBCA”) and Article 3 of the by-laws of the Purchaser. Each of
Acquisition’s Board of Directors and shareholders has approved this Agreement and the Merger for
purposes of Sections 607.0821 and 607.1103 of the FBCA and Article II of the by-laws of
Acquisition.

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     3.22. Purchaser Shareholders’ Approval. On or prior to the Closing Date, the
shareholders of the Purchaser will approve in accordance with the MBCA by resolutions duly adopted
by a written consent or a vote of a majority of the Purchaser’s shareholders entitled to vote at a
meeting duly called and held and not subsequently rescinded or modified in any way (i) this
Agreement, the Merger and the transactions contemplated hereby and thereby, (ii) an amendment to
the articles of incorporation of the Purchaser (a) amending its corporate purpose, (b) changing
its corporate name, and (c) increasing the Purchaser’s Board of Directors to five (5) members from
three (3), and (iii) the appointment of certain directors to the Purchaser’s Board of Directors as
set forth on Schedule 1.7(a) attached hereto (the “Purchaser Shareholders’
Approval”).

     3.23. Banks. (i) the name of each bank, trust company or other financial institution
and stock or other broker with which the Purchaser has an account, credit line or safe deposit box
or vault, (ii) the names of all persons authorized to draw thereon or to have access to any safe
deposit box or vault, (iii) the purpose of each such account, safe deposit box or vault, and (iv)
the names of all persons authorized by proxies, powers of attorney or other like instrument to act
on behalf of the Purchaser in matters concerning any of its business or affairs is set forth on
Schedule 3.23 attached hereto. No such proxies, powers of attorney or other like
instruments are irrevocable.

     3.24. Absence of Certain Changes. Since the Financial Statement Date, there has
not been any (a) Material Adverse Change in the business, operations, properties, assets,
condition (financial or otherwise), results, plans, strategies or prospects of the Purchaser;
(b) damage, destruction or loss, whether covered by insurance or not, having a cost of $100,000
or more, with regard to the Purchaser’s property and business; (c) declaration, setting aside
or payment of any dividend or distribution (whether in cash, stock or property) in respect of
the Purchaser’s capital stock, Options or securities convertible into or exchangeable for
capital stock; (d) redemption or other acquisition of capital stock, Options or securities
convertible into or exchangeable for capital stock by the Purchaser or any payment of any stock
appreciation right or other profit participation; (e) increase in the compensation payable to
or to become payable by the Purchaser to its officers or employees or any adoption of or
increase in any bonus, insurance, pension or other employee benefit plan, payment or
arrangement made to, for or with any such officers or employees or any Affiliate of the
Purchaser; (f) entry into any material Contract not in the ordinary course of business,
including without limitation, any borrowing from any new lender or in excess of the existing
credit limits or capital expenditure; (g) change by the Purchaser in accounting methods or
principles or any write-down, write-up or revaluation of any assets of the Purchaser except
depreciation accounted for in the ordinary course of business and write downs of inventory
which reflect the lower of cost or market and which are in the ordinary course of business; (h)
failure to promptly pay and discharge current liabilities or agree with any party to extend the
payment of any current liability; (i) Lien placed on any property of the Purchaser other than
Permitted Liens; (j) sale, assignment, transfer, lease, license or otherwise placement of a
Lien on any of the Purchaser’s tangible assets, except in the ordinary course of business
consistent with past practice, or canceled any material debts or Claims; (k) sale, assignment,
transfer, lease, license or otherwise placement of a Lien on any Intellectual Property rights
or other intangible assets, disclosure of any material confidential information to any Person
or abandoned or permitted to lapse any Intellectual Property rights;

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(1) commitment to make any charitable contributions or pledges exceeding in the
aggregate $25,000; or (m) agreement, whether orally or in writing, to do any of the
foregoing.

     3.25. Disclosure. Neither this Agreement nor any of the Contracts, exhibits,
attachments, written statements, documents, certificates or other items prepared for or supplied
to the Purchaser by or on behalf of the Purchaser with respect to the transactions contemplated
hereby contains any untrue statement of a material fact or omits a material fact necessary to make
each statement contained herein or therein not misleading. There is no fact which the Purchaser
has not disclosed to the Corporation herein and of which the Purchaser, or any of their respective
officers, directors or executive employees is aware which could reasonably be anticipated to have
a Material Adverse Effect on Purchaser or the ability of Purchaser to continue the businesses of
the Purchaser in the same manner as the Purchaser conducted its business prior to the Closing
Date.

ARTICLE IV

COVENANTS OF THE PURCHASER, ACQUISITION AND THE CORPORATION

     4.1. Covenants of the Corporation. Until the Closing Date, except as otherwise
consented to or approved by the Purchaser in writing or as necessary or beneficial to effect the
Restructuring, the Corporation and the Sellers agree that they shall act, or refrain from acting
where required hereinafter, to comply (and in the case of the Sellers, to cause the Corporation
to comply) with the following:

          (a) Regular Course of Business. The Corporation shall (a) operate its business
diligently and in good faith, consistent with past management practices; (b) maintain all of its
properties in customary repair, order and condition, reasonable wear and tear excepted; (c)
maintain (except for expiration due to lapse of time) all leases and Contracts in effect without
change except as expressly provided herein; (d) comply with the provisions of all Regulations and
Orders applicable to the Corporation and the conduct of its business; (e) not cancel, release,
waive or compromise any debt, Claim or right in its favor having a value in excess of $5,000
other than in connection with returns of inventory for credit or replacement in the ordinary
course of business; (f) not alter the rate or basis of compensation of any of its officers,
directors or employees other than in the ordinary course of business consistent with past
practice and immaterial in amount; (g) maintain its books, accounts and records in accordance
with past custom and practice as used in the preparation of the Financial Statements; (h)
maintain in full force and effect the existence of all Intellectual Property Rights; (i) use its
reasonable best efforts to preserve the goodwill and organization of its business and its
relationships with its customers, suppliers, employees and other Persons having business
relations with it; G) not take or omit to take any action that would require disclosure under
Article II, or that would otherwise result in a breach of any of the representations, warranties
or covenants made by the Corporation in this Agreement or in any of the agreements contemplated
hereby; and (k) not take any action or omit to take any action which act or omission would
reasonably be anticipated to have a Material Adverse Effect.

          (b) Capital Changes. The Corporation shall not issue or sell any shares of its
capital stock or issue or sell any securities convertible or exchangeable into, or Options to

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subscribe for, any shares of its capital stock and the Corporation shall not pledge or otherwise
encumber any shares of its capital stock. The Corporation shall not redeem, retire, purchase or
otherwise acquire directly or indirectly any of its issued and outstanding capital stock, Options
or any outstanding rights or securities exercisable or exchangeable for or convertible into its
capital stock. The Corporation shall not declare, pay or set aside for payment any dividend or
other distribution in respect of its capital stock, Options or any outstanding rights or
securities exercisable or exchangeable for or convertible into its capital stock. The Corporation
shall not issue any additional Options or enter into any Contracts containing any profit
participation features, stock appreciation rights or phantom stock option plans, or similar
Contracts that allows any Person to participate in the equity of the Corporation. The Corporation
shall not amend its charter or bylaws or merge into or consolidate with any other Person or change
the character of its business. In addition, the Corporation shall not allow the transfer of any
shares of its capital stock on the stock transfer ledger or other books and records.

          (c) Capital and Other Expenditures. The Corporation shall not make any Investments
or capital expenditures, or commitments with respect thereto, except as provided in its budget set
forth in Schedule 2.18 attached hereto. The Corporation shall not make any loan or advance
to any Person (other than accounts receivable made in the ordinary course of business) and shall
collect in full any amounts outstanding now due from any Affiliate. The Corporation shall not make
any charitable or other contributions to any Person nor shall it make any commitments therefor.

          (d) Borrowing. The Corporation shall not incur, assume or Guarantee any
Indebtedness not reflected on the Financial Statements except in the ordinary course of business
under existing credit facilities as such credit facilities exist on the date hereof.

          (e) Other Commitments. Except as set forth in this Agreement, incurred or transacted
in the ordinary course of business, or permitted in writing by the Purchaser, the Corporation
shall not enter into any material Contract or transaction or make any commitment or incur any
material obligation or liability (including entering into any real property leases).

          (f) Interim Financial Information and Audit. The Corporation shall supply the
Purchaser with unaudited monthly operating statements within thirty (30) days after the end of
each month ending between the date hereof and the Closing Date, certified by the Corporation’s
chief financial officer as having been prepared in accordance with procedures employed by the
Corporation in preparing prior monthly operating statements necessary to fairly present the
Corporation’s financial position, results of operations and changes in financial position at and
for such periods.

          (g) Full Access and Disclosure. The Corporation shall afford to the Purchaser and
its counsel, accountants, agents and other authorized representatives and to financial
institutions specified by the Purchaser reasonable access during business hours to the
Corporation’s plants, properties, books and records in order that the Purchaser may have full
opportunity to make such reasonable investigations as it shall desire to make of the affairs of
the Corporation. The Corporation shall cause its officers, employees, counsel and auditors to
furnish such additional financial and operating data and other information as the Purchaser shall
from time to time reasonably request including, without limitation, any internal control

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recommendations made by its independent auditors in connection with any audit of the
Corporation. From time to time prior to the Closing Date, the Corporation shall promptly
supplement or amend information previously delivered to the Purchaser with respect to any matter
hereafter arising which, if existing or occurring at the date of this Agreement, would have been
required to be set forth or disclosed herein; provided, however, that such supplemental
information shall not be deemed to be an amendment to any schedule hereto and shall not change the
risk allocation of this Agreement between the Purchaser and the Sellers.

          (h) Tax Matters. The Corporation shall not make or change any election, file a Tax
Return not in accordance with past practice, change an annual accounting period, adopt or
change any accounting method, file any amended Tax Return, enter into any closing agreement,
settle any Tax Claim or assessment relating to the Corporation or any of its Subsidiaries,
surrender any right to claim a refund of Taxes, consent to any extension or waiver of the
limitation period applicable to any Tax Claim or assessment relating to the Corporation, or any of
its Subsidiaries, or take any other similar action, or omit to take any action relating to the
filing of any Tax Return or the payment of any Tax, if such election, adoption, change, amendment,
Contract, settlement, surrender, consent or other action or omission, would have the effect of
increasing the present or future Tax liability or decreasing any present or future Tax asset of
the Corporation.

          (i) Fulfillment of Conditions Precedent. The Corporation and the Sellers shall
use their reasonable best efforts to obtain at the Corporation’s expense all such waivers,
Permits, consents, approvals or other authorizations from third Persons and Authorities, and to
do all things as may be necessary or desirable in connection with transactions contemplated by
this Agreement.

          (j) Satisfaction of Closing Conditions. Except as required by applicable law, the
Corporation shall not, and shall not permit any of its Subsidiaries to, take any action that
would, or would reasonably be expected to, result in (i) any of the conditions to the Merger set
forth in Article VI not being satisfied or (ii) a material delay in the satisfaction of such
conditions.

          (k) Tax-Free Qualification. The Corporation shall use its reasonable best
efforts not to, and shall use its reasonable best efforts not to permit any of its respective
Subsidiaries to, take any action that would prevent or impede the Merger from qualifying as a
reorganization under Section 368 of the Code.

     4.2. Covenants of the Purchaser. Until the Closing Date, except as otherwise
consented to or approved by the Corporation in writing or as necessary or beneficial to effect
the Restructuring, the Purchaser and Acquisition agree that they shall act, or refrain from
acting where required hereinafter, to comply with the following:

          (a) Regular Course of Business. The Purchaser shall (a) operate its business
diligently and in good faith, consistent with past management practices; (b) maintain all of its
properties in customary repair, order and condition, reasonable wear and tear excepted; (c)
maintain (except for expiration due to lapse of time) all leases and Contracts in effect without
change except as expressly provided herein; (d) comply with the provisions of all Regulations

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and Orders applicable to the Purchaser and the conduct of its business; (e) not cancel,
release, waive or compromise any debt, Claim or right in its favor having a value in excess of
$5,000 other than in connection with returns of inventory for credit or replacement in the
ordinary course of business; (f) not alter the rate or basis of compensation of any of its
officers, directors or employees other than in the ordinary course of business consistent with
past practice and immaterial in amount; (g) use its reasonable best efforts to preserve the
goodwill and organization of its business and its relationships with its customers, suppliers,
employees and other Persons having business relations with it; (h) not take or omit to take any
action that would require disclosure under Article III, or that would otherwise result in a breach
of any of the representations, warranties or covenants made by the Purchaser in this Agreement or
in any of the agreements contemplated hereby; and (i) not take any action or omit to take any
action which act or omission would reasonably be anticipated to have a Material Adverse Effect.

          (b) Capital Changes. Other than the shares of the Purchaser Common Stock to be
sold in the Private Placement, the Purchaser shall not issue or sell any shares of its capital
stock or issue or sell any securities convertible or exchangeable into, or Options to subscribe
for, any shares of its capital stock and the Purchaser shall not pledge or otherwise encumber
any shares of its capital stock. Other than the 94,000,000 shares of the Purchaser Common Stock
to be forfeited by the Tamborine Majority Shareholder pursuant to Section 5.14, the Purchaser
shall not redeem, retire, purchase or otherwise acquire directly or indirectly any of its issued
and outstanding capital stock, Options or any outstanding rights or securities exercisable or
exchangeable for or convertible into its capital stock. The Purchaser shall not declare, payor
set aside for payment any dividend or other distribution in respect of its capital stock,
Options or any outstanding rights or securities exercisable or exchangeable for or convertible
into its capital stock. The Purchaser shall not issue any additional Options or enter into any
Contracts containing any profit participation features, stock appreciation rights or phantom
stock option plans, or similar Contracts that allows any Person to participate in the equity of
the Purchaser. The Purchaser shall not amend its charter or bylaws or merge into or consolidate
with any other Person or change the character of its business. In addition, other than the
shares of the Purchaser Common Stock to be sold in the Private Placement, the Purchaser shall
not allow the transfer of any shares of its capital stock on the stock transfer ledger or other
books and records.

          (c) Capital and Other Expenditures. The Purchaser shall not make any Investments or
capital expenditures, or commitments with respect thereto. The Purchaser shall not make any loan
or advance to any Person (other than accounts receivable made in the ordinary course of business)
and shall collect in full any amounts outstanding now due from any Affiliate. The Purchaser shall
not make any charitable or other contributions to any Person nor shall it make any commitments
therefor.

          (d) Borrowing. The Purchaser shall not incur, assume or Guarantee any Indebtedness
not reflected on the Financial Statements except in the ordinary course of business under
existing credit facilities as such credit facilities exist on the date hereof.

          (e) Other Commitments. Except as set forth in this Agreement, incurred or
transacted in the ordinary course of business, or permitted in writing by the Purchaser, the
Purchaser shall not enter into any material Contract or transaction or make any commitment or
incur any material obligation or liability (including entering into any real property leases).

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          (f) Interim Financial Information and Audit. The Purchaser shall supply the
Corporation with unaudited monthly operating statements within thirty (30) days after the end of
each month ending between the date hereof and the Closing Date, certified by the Purchaser’s
president or chief financial officer as having been prepared in accordance with procedures
employed by the Corporation in preparing prior monthly operating statements necessary to fairly
present the Purchaser’s financial position, results of operations and changes in financial
position at and for such periods.

          (g) Full Access and Disclosure. The Purchaser shall afford to the Corporation and
its counsel, accountants, agents and other authorized representatives and to financial
institutions specified by the Corporation reasonable access during business hours to the
Corporation’s plants, properties, books and records in order that the Corporation may have full
opportunity to make such reasonable investigations as it shall desire to make of the affairs of
the Purchaser. The Purchaser shall cause its officers, employees, counsel and auditors to furnish
such additional financial and operating data and other information as the Corporation shall from
time to time reasonably request including, without limitation, any internal control
recommendations made by its independent auditors in connection with any audit of the Purchaser.
From time to time prior to the Closing Date, the Purchaser shall promptly supplement or amend
information previously delivered to the Purchaser with respect to any matter hereafter arising
which, if existing or occurring at the date of this Agreement, would have been required to be set
forth or disclosed herein; provided, however, that such supplemental information shall not be
deemed to be an amendment to any schedule hereto and shall not change the risk allocation of this
Agreement between the Purchaser and the Sellers.

          (h) Tax Matters. The Purchaser shall not make or change any election, change an
annual accounting period, adopt or change any accounting method, file any amended Tax Return,
enter into any closing agreement, settle any Tax Claim or assessment relating to the Purchaser or
any of its Subsidiaries, surrender any right to claim a refund of Taxes, consent to any extension
or waiver of the limitation period applicable to any Tax Claim or assessment relating to the
Purchaser, or any of its Subsidiaries, or take any other similar action, or omit to take any
action relating to the filing of any Tax Return or the payment of any Tax, if such election,
adoption, change, amendment, Contract, settlement, surrender, consent or other action or
omission, would have the effect of increasing the present or future Tax liability or decreasing
any present or future Tax asset of the Purchaser.

          (i) Fulfillment of Conditions Precedent. The Purchaser shall use its reasonable best
efforts to obtain at their expense all such waivers, Permits, consents, approvals or other
authorizations from third Persons and Authorities, and to do all things as may be necessary or
desirable in connection with transactions contemplated by this Agreement.

          (j) Satisfaction of Closing Conditions. Except as required by applicable law, the
Purchaser shall not, and shall not permit any of its Subsidiaries to, take any action that would,
or would reasonably be expected to, result in (i) any of the conditions to the Merger set forth in
Article VII not being satisfied or (ii) a material delay in the satisfaction of such conditions.

          (k) Tax-Free Qualification. The Purchaser shall use its reasonable best efforts not
to, and shall use its reasonable best efforts not to permit any of its respective

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Subsidiaries to, take any action that would prevent or impede the Merger from qualifying
as a reorganization under Section 368 of the Code.

ARTICLE V

ADDITIONAL AGREEMENTS

     5.1. Confidentiality. Except as may be required by lawful Order of an Authority of
competent jurisdiction, each party agrees that each party and its representatives and its
Affiliates and their representatives and advisors will hold in strict confidence all data and
information obtained from the other party in connection with the transactions contemplated
hereby, except any of the same which (a) was, is now, or becomes generally available to the
public (but not as a result of a breach of any duty of confidentiality by which a party and its
representatives and advisors arc bound); (b) was known to a party prior to its disclosure to
such other as demonstrated by such party’s written records; (c) is disclosed to a party by a
third party not subject to any duty of confidentiality to the other party prior to its
disclosure to such party by the other party, or (d) may be disclosed pursuant to Section 5.7.
Each party will use such data and information solely for the specific purpose of evaluating the
transactions contemplated hereby. If this Agreement is properly terminated, each party and its
Affiliates and their representatives and advisors will promptly return to the other party or
destroy all such data, information and other written material (including all copies thereof)
which has been obtained by such party, and such party will make no further use whatsoever of any
of such or the information and knowledge contained therein or derived therefrom. The provisions
of this Section 5.1 shall supersede any confidentiality or similar Contract that may exist
between the parties prior to the date hereof.

     5.2. Agreement to Defend. In the event any action, suit, proceeding or
investigation is commenced, whether before or after the Closing Date, all the parties hereto
agree to cooperate and use their best efforts to defend against and respond thereto.

     5.3. Further Assurances. Subject to the terms and conditions of this Agreement, the
parties hereto shall use their best efforts to take, or cause to be taken, all action, and to do,
or cause to be done, all things necessary, proper or advisable under applicable Regulations and
Orders to consummate and make effective as promptly as possible the transactions contemplated by
this Agreement and the agreements contemplated hereby, and to cooperate with each other in
connection with the foregoing, including without limitation using their best efforts (a) to
obtain all necessary waivers, consents, and approvals from other parties to loan agreements,
leases, mortgages and other Contracts; (b) to obtain all necessary Permits, consents, approvals
and authorizations as are required to be obtained under any Regulation or Order; (c) to lift or
rescind any injunction or restraining order or other Order adversely affecting the ability of the
parties to consummate the transactions contemplated hereby; (d) to effect all necessary
registrations and filings including, but not limited to, filings and submissions of information
requested by Authorities; and (e) to fulfill all conditions to the obligations of the parties
under this Agreement. Each of the Purchaser and the Corporation further covenants and agrees that
it shall use its respective best efforts to prevent, with respect to a threatened or pending
preliminary or permanent injunction or other Regulation or Order the entry, enactment or
promulgation thereof, as the case may be.

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     5.4. No Solicitation or Negotiation. The Purchaser, the Corporation and the
Sellers shall not, and the Purchaser and the Corporation shall use their best efforts to ensure
that its shareholders, and any of its and its shareholders’ Affiliates, representatives, officers,
employees, directors or agents shall not, directly or indirectly (a) submit, solicit, initiate,
encourage or discuss any proposal or offer from any Person or enter into any Contract or accept
any offer relating to or to consummate any (i) reorganization, liquidation, dissolution or
recapitalization of the Purchaser or the Corporation, as the case may be; (ii) merger or
consolidation involving the Purchaser or the Corporation, as the case may be; (iii) purchase or
sale of any of the assets or capital stock, Options, stock appreciation rights, phantom stock
options or other similar equity based participations (or any rights to acquire, or securities
convertible into or exchangeable for, any such capital stock, Options, stock appreciation rights,
phantom stock options or other such securities) of the Purchaser or the Corporation, as the case
may be (other than a purchase or sale of inventory and worn-out or obsolete assets in the ordinary
course of business consistent with past custom and practice and in accordance with the terms of
this Agreement); (iv) similar transaction or business combination involving the Purchaser or the
Corporation, as the case may be, or their assets; or (v) acquisition by the Purchaser or the
Corporation, as the case may be, of other businesses, whether by the purchase of assets or capital
stock of another Person; or (b) furnish any information with respect to, assist or participate in
or facilitate in any other manner any effort or attempt by any Person to do or seek to do any of
the foregoing; provided however, nothing herein shall limit or restrict in any way the Purchaser
or the Corporation, as the case may be, from communicating with its legal, accounting and other
professional advisors or lenders for the purpose of facilitating the transactions contemplated by
this Agreement. Each party shall notify the other party immediately if any Person makes any
proposal, offer, inquiry or contact to the such party or, to the such party’s knowledge, any other
Person for the purpose of effectuating one or more of the foregoing transactions.

     5.5. No Termination of the Corporation’s and the Sellers’ Obligations by Subsequent
Incapacity, Dissolution, Etc. Each Seller specifically agrees that the obligations of such
Seller hereunder, shall not be terminated by the dissolution of such Seller, by operation of law
or by the death or incapacity of any individual Seller. The Corporation hereby agrees that its
obligations pursuant to this Agreement shall not be terminated by the dissolution of the
Corporation, by operation of law or otherwise.

     5.6. Deliveries After Closing. From time to time after the Closing, at the
Purchaser’s request and without expense to the Corporation or any Subsidiary and without further
consideration from the Purchaser, the Corporation or any Subsidiary, the Sellers shall execute
and deliver such other instruments of conveyance and transfer and take such other action as the
Purchaser reasonably may’ require to convey, transfer to and vest in the Purchaser and to put the
Purchaser in possession of any rights or property to be sold, conveyed, transferred and delivered
hereunder.

     5.7. Public Announcements. Prior to the Closing, neither the Sellers, the
Corporation nor the Purchaser nor any Affiliate, representative or shareholder of such Persons,
shall disclose any of the terms of this Agreement to any third party without the other party’s
prior written
consent. The form, content and timing of all press releases, public announcements or publicity
statements with respect to this Agreement and transactions contemplated hereby shall be subject
to the prior approval of both the Corporation and the Purchaser, which approval shall not be

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unreasonably withheld. No press releases, public announcements or publicity statements shall
be released by either party without such prior mutual agreement.

     5.8. Information for the Private Placement Memorandum. On or prior to the date
hereof, the Purchaser completed the Private Placement as described in the Private Placement
Memorandum. Each of the parties has furnished and shall furnish all information concerning itself
that is required or customary for inclusion in the Private Placement Memorandum. If at any time
prior to the Effective Time any information relating to the Purchaser, Acquisition or the
Corporation, or any of their respective affiliates, trustees, directors or officers, is discovered
that should be set forth in an amendment or supplement to the Private Placement Memorandum, so
that any of such documents would not include any misstatement of a material fact or omit to state
any material fact necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, the party that discovers such information shall promptly
notify the other parties hereto and an appropriate amendment or supplement describing such
information shall be made to the Private Placement Memorandum and, to the extent required by
applicable law, disseminated to the purchasers and prospective purchasers of the Purchaser Common
Stock pursuant to the Private Placement Memorandum.

     5.9. Current Information. During the period from the date of this Agreement to the
Effective Time, the Corporation and the Purchaser will cause one or more of their designated
representatives to confer on a regular and frequent basis (not less than weekly) with each other
and to report the general status of the ongoing operations of each of the Purchaser and the
Corporation. The Corporation will promptly notify the Purchaser of any material change in the
normal course of business or in the operation of the properties of the Corporation and of any
governmental complaints, investigations or hearings (or communications indicating that the same
may be contemplated), or the institution or the threat of significant litigation involving the
Corporation and will keep the Purchaser fully informed of such events. The Purchaser will promptly
notify the Corporation of any material change in the normal course of business or in the operation
of the properties of the Purchaser and of any governmental complaints, investigations or hearings
(or communications indicating that the same may be contemplated), or the institution or the threat
of significant litigation involving the Purchaser and will keep the Corporation fully informed of
such events.

     5.10. Directors and Officers of the Purchaser and the Surviving
Corporation.

          (a) The Purchaser and the Corporation shall take, or cause to be taken, all action necessary
so that at the Effective Time, the directors and officers of the Purchaser shall be as set forth
on Schedule 1.7(a) attached hereto.

          (b) The Purchaser, Acquisition and the Corporation shall take, or cause to be taken, all
action necessary so that at or immediately after the Effective Time, the directors and officers
of the Surviving Corporation shall be as set forth on Exhibits 1.7(a) attached hereto,
respectively.

     5.11. Certain Employee Agreements. The Purchaser and its Subsidiaries shall
honor, without modification, all contracts, agreements, collective bargaining agreements and
commitments of the Corporation and its Subsidiaries that apply to any current or former

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employees or current or former directors of the Corporation and its Subsidiaries; provided,
however, that this undertaking is not intended to prevent the Purchaser from enforcing such
contracts, agreements, collective bargaining agreements and commitments in accordance with their
terms, or from enforcing any right to amend, modify, suspend, revoke or terminate any such
contract, agreement, collective bargaining agreement or commitment.

     5.12. Available Cash. Immediately prior to the Effective Time, the Purchaser shall
have not less than $500,000 of cash (or cash equivalents) net of any Indebtedness and shall have
no liabilities, whether fixed, accrued or contingent other than not more than an aggregate of
$100,000 in fees, expenses or disbursements incurred in connection with this Agreement, the
Merger, the Private Placement and the consummation of the transactions contemplated herby and
thereby.

     5.13. Conveyance Taxes. The Purchaser and the Corporation shall cooperate in the
preparation, execution and filing of all returns, questionnaires, applications or other documents
regarding any real property transfer or gains, sales, use, transfer, value added, stock transfer
and stamp Taxes, any transfer, recording, registration and other fees, and any similar Taxes
which become payable in connection with the transactions contemplated by this Agreement that are
required or permitted to be paid on or before the Effective Time.

     5.14. Purchaser Capitalization Adjustment. On or prior to the Closing Date, the
Tamborine Majority Shareholder solely as it relates to the Purchaser’s representations and
warranties contained in Section 3.5 “Capitalization” of this Agreement, shall forfeit and tender
to the Purchaser for cancellation 94,000,000 shares of the Purchaser Common Stock that is
beneficially owned by Tamborine Majority Shareholder.

     5.15. Audited Financial Statement. On or prior to June 30, 2005, an audit of the
Corporation’s financial statements for the calendar year ending December 31,2004 shall have been
completed and prepared in accordance with GAAP by a recognized independent accounting firm, and a
copy of such audited financial statement shall have been delivered to the Purchaser.

     5.16. Stock Incentive Plan. As soon as practicable after the Closing, the Purchaser
shall adopt and implement the Purchaser Stock Option Plan pursuant to which the Purchaser shall
have the right to issue up to 1,000,000 shares of the Purchaser Common Stock in the form of
Options or restricted stock to the Purchaser employees, non-employee directors, consultants and
advisors.

     5.17. Restructuring. Prior to the Closing, as described on Schedule 5.17
attached hereto, the Corporation shall effectuate a restructuring of its assets, Affiliates and
Subsidiaries whereby (i) each of International Hydrogen Technologies, Inc., a Florida corporation
(“IHTI”), and Innovative Engines, Inc. a Florida corporation (“IEI”), shall be
formed as wholly owned Subsidiaries of the Corporation, and (ii) each of the shareholders and
members, as the case ay be, of SESI and SESLLC, shall exchange their respective shares or
membership interests, as the case may be, for shares of the Corporation (the
“Restructuring”). Upon consummation of the Restructuring, each of IHTI, IEI, SESI and
SESLLC shall be wholly owned Subsidiaries of the Corporation, and any and all assets relating to
the Business shall be owned by the Corporation or its Subsidiaries free and clear of any Liens,
Contracts or Orders. Any and all Taxes resulting

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from the Restructuring shall be the responsibility of the Surviving Corporation and the
Purchaser and may be paid from the $100,000 allocated for expenses pursuant to Section 5.12.

     5.18. Private Placement. Prior to the Closing, the Purchaser shall sell at least
200,000 shares of the Purchaser Common Stock pursuant to the Private Placement. Pursuant to the
terms of the Private Placement, the Purchaser shall sell an additional 1,800,000 shares of the
Purchaser Common Stock pursuant to the Private Placement.

     5.19. Termination of Corporation Shareholders Agreements. The Sellers shall cause
any and all shareholders agreements of the Corporation, IHTI, IEI, SESI and SES LLC to be
terminated at or prior to Closing without any further liability or obligation to the
Corporation.

     5.20. Payment of Taxes.

          (a) The Sellers shall be responsible and liable for the timely payment of any and all Taxes
imposed on or with respect to the properties, income and operations of the Corporation and its
Subsidiaries for all Pre-Closing Periods, including the portion of the Overlap Period up to and
including the Closing Date. In addition, the Sellers shall pay Purchaser the amount of any Taxes
allocated to the Sellers pursuant to Section 5.20(b) below (to the extent that the Sellers are
liable therefor and to the extent not already paid by the Sellers on or before the Closing Date)
five (5) business days prior to the due date of such Taxes.

          (b) All Taxes and Tax liabilities with respect to the income, property or operations of the
Corporation and its Subsidiaries that relate to the Overlap Period shall be apportioned between
the Sellers and Purchaser as follows: (i) in the case of Taxes other than income, sales and use
and withholding Taxes, on a per diem basis, and (ii) in the case of income, sales and use and
withholding Taxes, as determined from the books and records of the Corporation and its
Subsidiaries as though the taxable year of the Corporation or any Subsidiary terminated at the
close of business on the Closing Date. The Sellers shall be liable for Taxes of the Corporation
and its Subsidiaries which are attributable to the portion of the Overlap Period ending on and
including the Closing Date.

          (c) All transfer, sales and use, value added, registration, documentary, stamp and similar
Taxes imposed in connection with the Merger Consideration or any other transaction that occurs
pursuant to this Agreement shall be borne solely by the Sellers.

ARTICLE VI

CONDITIONS TO THE OBLIGATIONS OF THE PURCHASER AND ACQUISITION

     Each and every obligation of the Purchaser under this Agreement shall be subject to the
satisfaction, on or before the Closing Date, of each of the following conditions unless waived in
writing by the Purchaser:

     6.1. Representations and Warranties; Performance. The representations and
warranties of the Corporation and the Sellers contained in Article II and elsewhere in this
Agreement and all information contained in any exhibit and schedule hereto delivered by, or on
behalf of, the Corporation and/or the Sellers to the Purchaser, which are modified by
materiality

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shall be true and correct (and all other representations shall be true and correct in all
material respects) when made and on the Closing Date as though then made, except as expressly
provided herein. The Corporation and the Sellers shall have performed and complied with all
agreements, covenants and conditions required by this Agreement to be performed and complied with
by them prior to the Closing Date. The president of the Corporation shall have delivered to the
Purchaser a certificate (which shall be addressed to the Purchaser), dated the Closing Date, in
the form designated Exhibit 6.1 hereto, certifying to the foregoing.

     6.2. Consents and Approvals. The Purchaser and the Corporation shall have obtained
any and all consents, approvals, Orders, Permits or other authorizations required by all
applicable Regulations, Orders and Contracts involving the Corporation or binding on its
properties and assets, with respect to the execution, delivery and performance of the Agreement
and the agreements contemplated hereby, the financing and consummation of the transactions
contemplated herein and the conduct of the business of the Corporation in the same manner after
the Closing Date as before the Closing Date.

     6.3. No Material Adverse Change. There shall have been no Material Adverse Change
since the date of this Agreement. The Purchaser shall have received certificates (which shall be
addressed to the Purchaser), dated the Closing Date, of the president and chief financial officer
of the Corporation, in the form of Exhibit 6.3 attached hereto, certifying to the
foregoing.

     6.4. No Proceeding or Litigation. No preliminary or permanent injunction or
other Order issued by a court of competent jurisdiction or by any Authority, or any Regulation
or Order promulgated or enacted by any Authority shall be in effect which would prevent the
consummation of the transactions contemplated hereby.

     6.5. Accounting Matters. The Purchaser shall have received a certificate, dated
the Closing Date, of the Corporation’s chief financial officer in form and substance
satisfactory to the Purchaser, as to the accuracy of all of the Financial Statements in the
form of Exhibit 6.5 attached hereto.

     6.6. Proceedings and Documents. All corporate and other proceedings in connection
with the transactions contemplated hereby and all documents and instruments incident to such
transactions shall be reasonably satisfactory in form and substance to the Purchaser and the
Purchaser’s counsel, and the Corporation shall have made available to the Purchaser for
examination the originals or true, complete and correct copies of all records and documents
relating to the business and affairs of the Corporation that the Purchaser may reasonably
request in connection with said transaction.

     6.7. Secretary’s Certificate. The Purchaser shall have received a certificate, by
the secretary of the Corporation, as to the charter and bylaws of the Corporation, the
resolutions adopted by the directors and shareholders of the Corporation in connection with this
Agreement, the incumbency of certain officers of the Corporation and the jurisdictions in which
the Corporation is qualified to conduct business in the form of Exhibit 6.7 attached
hereto.

     6.8. Certificates of Good Standing. At the Closing, the Corporation shall
have delivered to the Purchaser certificates issued by the appropriate governmental
Authorities

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evidencing the good standing, with respect to both the conduct of business and the payment of
all Taxes, of the Corporation and each of its Subsidiaries as of a date not more than fifteen (15)
days prior to the Closing Date as a corporation organized under the laws of the state and as a
foreign
corporation authorized to do business under the laws of the jurisdictions listed in the
schedules hereto.

     6.9. Employment Agreements. Messrs. Donald P. Bunnell, Gregory B. Golden and
Lorenzo C. Lamadrid shall have each executed and delivered employment agreements in a form
mutually agreed to by the Purchaser and the employee signatory thereto providing for the
continued employment of such Persons with the Corporation and containing non-compete and
non-solicitation provisions (the “Employment Agreements”).

     6.10. Private Placement. The Purchaser shall have completed the Private Placement
and at least 200,000 shares of the Purchaser Common Stock shall have been sold in connection
with the Private Placement.

     6.11. Directors and Officers of the Surviving Corporation. Prior to or at the
Effective Time, the Corporation shall have taken, or caused to be taken, all necessary
corporate action so that, at or immediately after the Effective Time, the directors and
officers of the Surviving
Corporation shall be as set forth on Schedule
1.7(a).

     6.12. The Corporation Shareholders’ Approval. The Corporation shall have delivered
to the Purchaser the Corporation Shareholders’ Approval and the matters set forth therein shall
have been effectuated.

     6.13 Restructuring. The Corporation shall have effectuated the
Restructuring.

     6.14. Delivery of Stock Certificates. Each Seller shall have delivered at the
Closing stock certificates representing all of its Shares, duly endorsed to the Purchaser,
together with stock powers executed in blank.

     6.15. Termination of Corporation Shareholders Agreements. The Sellers shall have
caused any and all shareholders agreements of the Corporation, IHTI, IEI, SESI and SES LLC to be
terminated at or prior to Closing without any further liability or obligation to the Corporation.

     6.16. Other Documents. The Corporation shall have furnished the Purchaser with such
other and further documents and certificates, including certificates of the Corporation’s
officers and others, as the Purchaser shall reasonably request to evidence compliance with the
conditions set forth in this Agreement.

ARTICLE VII

CONDITIONS TO THE OBLIGATIONS OF THE CORPORATION AND THE SELLERS

     Each and every obligation of the Corporation and the Sellers under this Agreement shall be
subject to the satisfaction, on or before the Closing Date, of each of the following conditions
unless waived in writing by the Corporation and the Sellers:

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     7.1. Representations and Warranties; Performance. The representations and
warranties of the Purchaser contained in Article III and elsewhere in this Agreement and all
information contained in any exhibit or schedule hereto delivered by, or on behalf of, the
Purchaser to the Corporation and the Sellers, which are modified by materiality shall be true and
correct (and all other representations shall be true and correct in all material respects) when
made and on the Closing Date as though then made, except as expressly provided herein. The
Purchaser shall have performed and complied with all agreements, covenants and conditions required
by this Agreement to be performed and complied with by it prior to the Closing Date. The president
of the Purchaser shall have delivered to the Corporation and the Sellers a certificate, dated the
Closing Date, in the form designated Exhibit 7.1 attached hereto, certifying to the
foregoing.

     7.2. Consents and Approvals. The Purchaser shall have obtained any and all consents,
approvals, Orders, Permits or other authorizations required by all applicable Regulations or
Orders involving the Purchaser, with respect to the execution, delivery and performance of the
Agreement and the consummation of the transactions contemplated hereby.

     7.3. No Material Adverse Change. There shall have been no Material Adverse
Change since the date of this Agreement. The Corporation shall have received certificates
(which shall be addressed to the Corporation), dated the Closing Date, of the president of
the Purchaser, in the form of Exhibit 7.3 attached hereto, certifying to the
foregoing.

     7.4. No Proceeding or Litigation. No preliminary or permanent injunction or
other Order issued by a court of competent jurisdiction or by any Authority, or any Regulation
or Order promulgated or enacted by any Authority shall be in effect which would prevent the
consummation of the transactions contemplated hereby.

     7.5. Accounting Matters. The Corporation shall have received a certificate, dated
the Closing Date, of the Purchaser’s president in form and substance satisfactory to the
Corporation, as to the accuracy of all of the Purchaser’s financial statements in the form of
Exhibit 7.5 attached hereto.

     7.6. Proceedings and Documents. All corporate and other proceedings in connection
with the transactions contemplated hereby and all documents and instruments incident to such
transactions shall be reasonably satisfactory in form and substance to the Corporation and the
Corporation’s counsel, and the Purchaser shall have made available to the Corporation for
examination the originals or true, complete and correct copies of all records and documents
relating to the business and affairs of the Purchaser that the Corporation may reasonably request
in connection with said transaction.

     7.7. Certificates of Good Standing. At the Closing, the Purchaser shall have
delivered to the Corporation certificates issued by the appropriate governmental Authorities
evidencing the good standing, with respect to both the conduct of business and the payment of all
Taxes, of the Purchaser and each of its Subsidiaries as of a date not more than fifteen (15) days
prior to the Closing Date as a corporation organized under the laws of the state and as a foreign
corporation authorized to do business under the laws of the jurisdictions listed in the schedules
hereto.

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     7.8. Secretary’s Certificate. The Sellers shall have received a certificate, by
the secretary of the Purchaser, dated the Closing Date, as to the charter and bylaws of the
Purchaser, the resolutions adopted by the directors of the Purchaser in connection with this
Agreement, the incumbency of certain officers of the Purchaser and the jurisdictions in which
Purchaser is qualified to conduct business in the form of Exhibit 7.8 hereto.

     7.9. Employment Agreements. The Corporation shall have executed the Employment Agreements

     7.10. Directors and Officers of the Surviving Corporation. Prior to or at the
Effective Time, the Purchaser and Acquisition shall have taken, or caused to be taken, all
necessary corporate action so that, at or immediately after the Effective Time, the directors and
officers of the Surviving Corporation shall be as set forth on Schedule 1.7(a) attached
hereto.

     7.11. Purchaser Shareholders’ Approval. The Purchaser shall have delivered to the
Corporation the Purchaser Shareholders’ Approval and the matters set forth therein shall have
been effectuated.

     7.12. The Corporation Agreements. The Purchaser shall have assumed the obligations
of the Corporation under the Corporation Employment Agreements on terms reasonably satisfactory
to the Corporation.

     7.13. The Purchaser Cash. Immediately prior to the Effective Time, the Purchaser
shall have not less than $500,000 of cash (or cash equivalents) net of any Indebtedness and shall
have no liabilities, whether fixed, accrued or contingent other than not more than an aggregate of
$100,000 in fees, expenses or disbursements incurred in connection with this Agreement, the
Merger, the Private Placement and the consummation of the transactions contemplated herby and
thereby.

     7.14. Purchaser Capitalization Adjustment. Tamborine Majority Shareholder shall have
forfeited and tendered to the Purchaser for cancellation 94,000,000 shares of the Purchaser Common
Stock that is beneficially owned by Tamborine Majority Shareholder.

     7.15. Private Placement. The Purchaser shall have completed the Private Placement
and at least 200,000 shares of the Purchaser Common Stock shall have been sold in connection
with the Private Placement.

     7.16. Shareholder Notice. Pursuant to Section 79-4-11.03 of the MBCA, the Purchaser
shall have delivered notice to its shareholders informing them that the Purchaser’s Board of
Directors and a majority of the Purchaser’s shareholders entitled to vote adopted this Agreement
and approved the Merger, the Private Placement and the transactions contemplated hereby and
thereby.

     7.17. Other Documents. The Purchaser shall have furnished the Corporation with such
other and further documents and certificates, including certificates of the Purchaser’s officers
and others, as the Corporation shall reasonably request to evidence compliance with the
conditions set forth in this Agreement.

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ARTICLE VIII

CLOSING

     8.1. Closing. Unless this Agreement shall have been terminated or abandoned pursuant
to the provisions of Article IX hereof, a closing of the transactions contemplated by this
Agreement (the “Closing”) shall be held on or before March 30, 2005 or on such other date
(the “Closing Date”) as mutually agreed to by the Purchaser and the Corporation in the
offices of White & Case LLP, 200 South Biscayne Boulevard, Suite 4900, Miami, Florida 33131,
provided that the Closing shall not occur, in any event, after April 18, 2005.

     8.2. Intervening Litigation. If prior to the Closing Date any preliminary or
permanent injunction or other Order issued by a court of competent jurisdiction or by any other
Authority shall restrain or prohibit this Agreement or the consummation of the transactions
contemplated hereby for a period of fifteen (15) days or longer, the Closing shall be adjourned at
the option of either party for a period of not more than thirty (30) days. If at the end of such
thirty (30) day period such injunction or Order shall not have been favorably resolved, either
party may, by written notice thereof to the other, terminate this Agreement, without liability or
further obligation hereunder.

ARTICLE IX

TERMINATION

     9.1. Methods of Termination. This Agreement may be terminated and
the
transactions herein contemplated may be abandoned at any time:

     (a) by mutual consent of the Purchaser, the Corporation and the Sellers;

     (b) by the Purchaser or the Corporation if this Agreement is not consummated on or before
April 18, 2005; provided that if any party has breached or defaulted with respect
to its obligations under this Agreement on or before such date, such party may not terminate this
Agreement pursuant to this Section 9.1(b), and each other party to this Agreement may at its
option enforce its rights against such breaching or defaulting party and seek any remedies against
such party, in either case as provided hereunder and by applicable Regulation;

     (c) by the Purchaser if as of the Closing Date any of the conditions specified in Article
VI hereof have not been satisfied or if the Sellers or the Corporation is otherwise in default
under this Agreement;

     (d) by the Corporation if as of the Closing Date any of the conditions specified in Article
VII hereof have not been satisfied or if the Purchaser is otherwise in default under this
Agreement;

     (e) by the Purchaser, if the Corporation shall have failed to obtain the Corporation
Shareholders’ Approval; or

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          (f) by the Corporation, if the Purchaser shall have failed to obtain the
Purchaser Shareholders’ Approval.

     9.2. Procedure Upon Termination. In the event of termination and abandonment
pursuant to Section 9.1 hereof, and subject to the proviso contained in Section 9.1(b) this
Agreement shall terminate and shall be abandoned, without further action by any of the
parties hereto. If this Agreement is terminated as provided herein:

          (a) each party shall either destroy or redeliver all documents and other material of
any other party relating to the transactions contemplated hereby, whether obtained before or
after the execution hereof, to the party furnishing the same;

          (b) all information received by any party hereto with respect to the business of any other
party (other than information which is a matter of public knowledge or which has heretofore been
or is hereafter published in any publication for public distribution or filed as public
information with any governmental authority) shall not at any time be used for the advantage of,
or disclosed to third parties by, such party to the detriment of the party furnishing
such information; and

          (c) other than as provided in Section 11.13 no non-breaching party hereto shall have
any liability or further obligation to any other party to this Agreement.

ARTICLE X

INDEMNIFICATION

     10.1. Indemnification of Officers and Directors.

          (a) Indemnification. To the extent, if any, not provided by an existing right of
indemnification or other agreement or policy, from and after the Effective Time, the Purchaser
and the Surviving Corporation shall, to the fullest extent not prohibited by applicable law,
indemnify, defend and hold harmless each person who is now, or has been at any time prior to the
date hereof, or who becomes prior to the Effective Time, an officer, director or management
employee of the Corporation and the Purchaser and their respective Subsidiaries (each an
“Indemnified Party” and, collectively, the “Indemnified Parties”) against (i) all
losses, expenses (including reasonable attorneys’ fees and expenses), Claims, damages, costs,
liabilities, judgments or (subject to the proviso of the next succeeding sentence) amounts that
are paid in settlement of or in connection with any Claim based in whole or in part on or arising
in whole or in part out of the fact that such person is or was a director, officer or management
employee of such party or any Subsidiary thereof, whether pertaining to any matter existing or
occurring after the Effective Time and whether asserted or claimed after the Effective Time and
(ii) all liabilities based in whole or in part on, or arising in whole or in part out of, or
pertaining to this Agreement, or the transactions contemplated hereby; provided,
however, that no such indemnification shall be required to be paid to an Indemnified
Party with respect to any losses, expenses, Claims, damages, costs, liabilities, judgments or
amounts that are finally determined by a court of competent jurisdiction (after exhaustion of all
appeals) or in an arbitration conducted in accordance with this Agreement), or as

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may be mutually determined, and set forth in a writing signed, by the Purchaser, the
Surviving Corporation and the Indemnified Party (each in its sole discretion), to have resulted
solely from the fraud, gross negligence or willful misconduct of such Indemnified Party. In the
event of any such loss, expense, Claim, damage, cost, liability, judgment or settlement (whether
or not arising before the Effective Time), (A) the Purchaser and the Surviving Corporation shall
pay the reasonable fees and expenses of counsel selected by the Indemnified Parties, which counsel
shall be reasonably satisfactory to the Purchaser and the Surviving Corporation, promptly after
statements therefor are received, and otherwise advance to the Indemnified Parties upon request
reimbursement of documented expenses reasonably incurred, (B) the Purchaser and the Surviving
Corporation shall cooperate in the defense of any such matter and (C) any determination required
to be made with respect to whether an Indemnified Party’s conduct complies with the standards
under applicable law or as set forth in the Purchaser’s or the Surviving Corporation’s articles of
incorporation or bylaws, as applicable, shall be made by independent counsel mutually acceptable
to the Purchaser, the Surviving Corporation and the Indemnified Party; provided,
however, that the Purchaser and the Surviving Corporation shall not be liable for any
settlement effected without their written consent (which consent shall not be unreasonably
withheld or delayed). The Indemnified Parties as a group may retain only one law firm (other than
local counsel) with respect to each related matter except to the extent there is, in the sole
opinion of counsel to an Indemnified Party, under applicable standards of professional conduct, a
conflict on any significant issue between positions of any two or more Indemnified Parties, in
which case each Indemnified Party with a conflicting position on a significant issue shall be
entitled to separate counsel.

          (b) Successors. In the event the Purchaser or any of its successors or assigns (i)
consolidates with or merges into any other person and shall not be the continuing or surviving
corporation or entity of such consolidation or merger or (ii) transfers all or substantially all
of its properties and assets to any person, then and in either such case, the Purchaser shall use
reasonable efforts to provide a provision that the successors and assigns of the Purchaser shall
assume the obligations set forth in this Section 10.1.

          (c) Survival of Indemnification. To the fullest extent not prohibited by law, from
and after the Effective Time, all rights to indemnification now existing in favor of the
employees, agents, directors or officers of the Purchaser and the Corporation and their respective
Subsidiaries with respect to their activities as such prior to or at the Effective Time, as
provided in their respective articles of incorporation or bylaws or indemnification agreements in
effect on the date of such activities or otherwise in effect on the date hereof, shall survive the
Merger and shall continue in full force and effect for a period of not less than six (6) years
from the Effective Time.

          (d) Benefit. The provisions of this Section 10.1 are intended to be for the
benefit of, and shall be enforceable by, each Indemnified Party, his or her heirs and his or
her representatives.

          (e) Taxes. Notwithstanding any provision to the contrary contained in this
Agreement, each Seller agrees to indemnify, defend and hold harmless the Purchaser, its Affiliates
(including the Surviving Corporation, the Corporation and their Subsidiaries) and the successors
to the foregoing (and their respective shareholders, officers, directors, employees and agents) on
an after-tax basis against (i) all Taxes, losses, claims and expenses resulting from,

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arising out of, or incurred with respect to, any claims that may be asserted by any party
based upon, attributable to, or resulting from the failure of any representation or warranty made
pursuant to Section 2.13 of this Agreement to be true and correct as of the Closing Date; (ii)
all Taxes imposed on or asserted against the properties, income or operations of the Corporation
or its Subsidiaries, or for which the Corporation or any of its Subsidiaries may otherwise be
liable, for all Pre-Closing Periods; (iii) all Taxes imposed on the Corporation or any of its
Subsidiaries, or for which the Corporation or any of its Subsidiaries may be liable, as a result
of any transaction contemplated by this Agreement; and (iv) all Taxes imposed on the Corporation
or any of its Subsidiaries as a result of the provisions of Treasury Regulations Section 1.1502-6
or the analogous provisions of any state, local or foreign law.

ARTICLE XI

MISCELLANEOUS PROVISIONS

     11.1. Amendment and Modification. This Agreement may be amended, modified and
supplemented only by written agreement of all the parties hereto with respect to any of the terms
contained herein. No course of dealing between or among the parties shall be deemed effective to
modify, amend, waive or discharge any part of this Agreement or any rights or obligations of any
party under or by reason of this Agreement.

     11.2. Waiver of Compliance; Consents. Any failure of any party hereto to comply with
any obligation, covenant, agreement or condition herein may be waived in writing by the other
parties hereto, but such waiver or failure to insist upon strict compliance with such obligation,
covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to,
any subsequent or other failure. Whenever this Agreement requires or permits consent by or on
behalf of any party hereto, such consent shall be given in writing to be effective.

     11.3. Certain Definitions.

          “24/7” shall have the meaning set forth in
2.16(j).

          “AAA” shall have the meaning set forth in Section
11.17.

          “Acquisition” shall have the meaning set forth in the
preamble.

          “Affiliate” means, with regard to any Person, (a) any Person, directly or indirectly,
controlled by, under common control of, or controlling such Person; (b) any Person, directly or
indirectly, in which such Person holds, of record or beneficially, 5% or more of the equity or
voting securities; (c) any Person that holds, of record or beneficially, 5% or more of the equity
or voting securities of such Person; (d) any Person that, through Contract, relationship or
otherwise, exerts a substantial influence on the management of such Person’s affairs; (e) any
Person that, through Contract, relationship or otherwise, is influenced substantially in the
management of its affairs by such Person; (f) any director, officer, partner or individual holding
a similar position in respect of such Person; or (g) as to any natural Person, any Person related
by blood, marriage or adoption and any Person owned by such Persons.

          “Agreement” shall have the meaning set forth in the
preamble.

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          “Articles of Merger” shall have the meaning set forth in
Section 1.2.

          “Authority” means any governmental, regulatory or administrative body, agency,
commission, board, arbitrator or authority, any court or judicial authority, any public, private
or industry regulatory authority, whether international, national, federal, state or local.

          “Business” shall have the meaning set forth in the
preamble.

          “CERCLA: means Comprehensive Environmental Response Compensation and Liability Act
of 1980, as amended, and the Regulations thereunder.

          “Certificates” shall have the meaning set forth in Section
1.10(a).

          “Claim” means any action, suit, claim, lawsuit, demand, suit, inquiry, hearing,
investigation, notice of a violation or noncompliance, litigation, proceeding, arbitration,
appeals or other dispute, whether civil, criminal, administrative or otherwise.

          “Closing” shall have the meaning set forth in Section
8.1.

          “Closing Date” shall have the meaning set forth in
Section 8.1.

          “Code” shall mean the Internal Revenue Code of 1986, as amended, and the
Regulations thereunder.

          “Contract” means any agreement, contract, commitment, instrument, document,
certificate or other binding arrangement or understanding, whether written or oral.

          “Corporation” shall mean, notwithstanding any definition in the preamble,
Synthesis Energy Holdings Corporation, Inc., a Florida corporation, and its Subsidiaries,
including without limitation 1HTI, IEI, SESI, and SESLLC, taken as a whole,.

          “Corporation Board Approval” shall have the meaning set forth in Section
2.27.

          “Corporation Capital Stock” shall have the meaning set forth in
Section 1.8.

          “Corporation Common Stock” shall have the meaning set forth in Section
1.8.

          “Corporation Intellectual Property” shall mean all Intellectual Property owned by the
Corporation or used in connection with the business of the Corporation and/or any of its
Subsidiaries.

          “Corporation Shareholders’ Approval” shall have the meaning set forth in
Section 2.28.

          “Effective Time” shall have the meaning set forth in
Section 1.3.

          “Employee Benefit Plans” shall have the meaning set forth in Section
2.15(a).

          “Employment Agreements” shall have the meaning set forth in Section
6.9.

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          “Environmental Law” shall mean any Regulation, Order, settlement agreement or
Authority requirement, which relates to or otherwise imposes liability or standards of conduct
concerning the environment, health, safety or Hazardous Substances, including without limitation,
discharges, emissions, releases or threatened releases of noises, odors or any Hazardous
Substances, whether as matter or energy, into ambient air, water, or land, or otherwise relating
to the manufacture, processing, generation, distribution, use, treatment, storage, disposal,
cleanup, transport or handling of Hazardous Substances, including but not limited to CERCLA, the
Superfund Amendments and Reauthorization Act of 1986, the Hazardous Material Transportation Act,
the Resource Conservation and Recovery Act of 1976, the Toxic Substances
Control Act, the Federal Water Pollution Control Act, the Clean Water Act, the Clean Air Act,
the Occupational Safety and Health Act, any so-called “Superlien” law, all as now or hereafter
amended or supplemented, and the Regulations promulgated thereunder, and any other similar
Federal, state or local Regulations.

          “ERISA” shall have the meaning set forth in Section
2.l5(a).

          “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended.

          “Exchange Ratio” shall have the meaning set forth in Section
1.8(c).

          “FBCA” shall have the meaning set forth in the
preamble.

          “Financial Statements” shall have the meaning set forth in Section
2.7(a).

          “Financial Statement Date” shall have the meaning set forth in Section
2.7(a).

          “GAAP” means U.S. generally accepted accounting principles, consistently
applied, as in existence at the date hereof.

          “Guarantee” means any guarantee or other contingent liability (other than any
endorsement for collection or deposit in the ordinary course of business), direct or indirect with
respect to any obligations of another Person, through a Contract or otherwise, including, without
limitation, (a) any endorsement or discount with recourse or undertaking substantially equivalent
to or having economic effect similar to a guarantee in respect of any such obligations and (b) any
Contract (i) to purchase, or to advance or supply funds for the payment or purchase of, any such
obligations, (ii) to purchase, sell or lease property, products, materials or supplies, or
transportation or services, in respect of enabling such other Person to pay any such obligation or
to assure the owner thereof against loss regardless of the delivery or nondelivery of the
property, products, materials or supplies or transportation or services or (iii) to make any loan,
advance or capital contribution to or other Investment in, or to otherwise provide funds to or
for, such other Person in respect of enabling such Person to satisfy an obligation (including any
liability for a dividend, stock liquidation payment or expense) or to assure a minimum equity,
working capital or other balance sheet condition in respect of any such obligation.

          “Hazardous Substances” shall be construed broadly to include any toxic or
hazardous substance, material, or waste, any petroleum or petroleum products, radioactive
materials, asbestos in any form that has become friable, ura formaldehyde foam insulation,
dielectric fluid containing levels of polychlorinated biphenyls, and radon gas, any
chemicals,

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materials or substances defined or included in the definition of “hazardous substances,”
“restricted hazardous wastes,” “toxic substances,” “toxic pollutants,” or words of similar import,
under any applicable Environmental Law, any other chemical, material or substance, exposure to
which is prohibited, limited, or regulated by any governmental Authority and any other
contaminant, pollutant or constituent thereof, whether liquid, solid, semi-solid, sludge and/or
gaseous, including without limitation, chemicals, compounds, by-products, pesticides, asbestos
containing materials, petroleum or petroleum products or by-products, and polychlorinated
biphenyls, the presence of which requires investigation or remediation under any Environmental Law
or which are or could reasonably be expected to become regulated, listed or controlled by, under
or pursuant to any Environmental Law, or which has been or shall be determined or interpreted at
any time by any Authority to be a hazardous or toxic substance regulated under any other
Regulation or Order.

          “IEI” shall have the meaning set forth in
Section 5.17.

          “IHTI” shall have the meaning set forth in
Section 5.17.

          “Indebtedness” with respect to any Person means (a) any obligation of such
Person for borrowed money, but in ~U1y event shall include: (i) any obligation or
liabilities incurred for all or any part of the purchase price of property or other assets or for the
cost of property or other assets constructed or of improvements thereto, other than accounts
payable

included in current liabilities and incurred in respect of property purchased in the ordinary
course of business, (whether or not such Person has assumed or become liable for the payment of
such obligation) (whether accrued, absolute, contingent, unliquidated or otherwise, known or
unknown, whether due or to become due); (ii) the face amount of all letters of credit issued for
the account of such Person and all drafts drawn thereunder; (iii) obligations incurred for all or
any part of the purchase price of property or other assets or for the cost of property or other
assets constructed or of improvements thereto, other than accounts payable included in current
liabilities and incurred in respect of property purchased in the ordinary course of business
(whether or not such Person has assumed or become liable for the payment of such obligation)
secured by Liens; (iv) capitalized lease obligations; and (v) all Guarantees of such Person; (b)
accounts payable of such Person that have not been paid within sixty (60) days of their due date
and are not being contested; (c) annual employee bonus obligations that are not accrued on the
Financial Statements; and (d) retroactive insurance premium obligations.

          “Indemnified Party” shall have the meaning set forth in Section
10.1(a).

          “Indemnified Parties” shall have the meaning set forth in Section
10.1(a).

          “Intellectual Property” means all domestic and foreign patents, patent applications,
trademarks, service marks and other indicia of origin, trademark and service mark registrations
and applications for registrations thereof, copyrights, copyright registrations and applications
for registration thereof, Internet domain names and universal resource locators (“URLs”),
trade secrets, inventions (whether or not patentable), invention disclosures, moral and economic
rights of authors and inventors (however denominated), technical data, customer lists, corporate
and business names, trade names, trade dress, brand names, know-how, show-how, maskworks,
formulae, methods (whether or not patentable), designs, processes, procedures,

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technology, source codes, object codes, computer software programs, databases, data
collectors and other proprietary information or material of any type, whether written or
unwritten (and all goodwill associated with, and all derivatives, improvements and refinements
of, any of the foregoing).

          “Investment” shall mean (a) any direct or indirect ownership, purchase or other
acquisition by a Person of any notes, obligations, instruments, capital stock, Options,
securities or ownership interests (including partnership interests and joint venture interests)
of any other Person; and (b) any capital contribution or similar obligation by a Person to any
other Person.

          “Lien” means any (a) security interest, lien, mortgage, pledge, hypothecation,
encumbrance, Claim, easement, charge, restriction on transfer or otherwise, or interest of another
Person of any kind or nature, including any conditional sale or other title retention Contract or
lease in the nature thereof; (b) any filing or agreement to file a financing statement as debtor
under the Uniform Commercial Code or any similar statute; and (c) any subordination arrangement in
favor of another Person.

          “Material Adverse Change” means any developments or changes which would have a
Material Adverse Effect.

          “Material Adverse Effect” means any circumstances, state of facts or matters which
might reasonably be expected to have a material adverse effect in respect of the Corporation’s
business, operations, properties, assets, condition (financial or otherwise), results, plans,
strategies or prospects.

          “ MBCA” shall have the meaning set forth
in Section 3.21.

          “Merger” shall have the meaning set forth in the
preamble.

          “Merger Consideration” shall have the meaning set forth in Section
1.8(c).

          “Merger Transactions” shall have the meaning set forth in Section
1.8(c).

          “Option” means any subscription, option, warrant, right, security, Contract,
commitment, understanding, stock appreciation right, phantom stock option, profit participation
or arrangement by which (a) with respect the Corporation, the Corporation is bound to issue any
additional shares of its capital stock or an interest in the equity or equity appreciation of the
Corporation or rights pursuant to which any Person has a right to purchase shares of the
Corporation’s capital stock or an interest in the equity or equity appreciation of the
Corporation or (b) with respect to a Seller, the Seller is bound to sell or allow another Person
to vote, encumber or control the disposition of any shares of the Corporation’s capital stock or
rights pursuant to which any Person has a right to purchase, vote, encumber or control the
disposition of shares of the Corporation’s capital stock from the Seller.

          “Order” means any writ, decree, order, judgment, injunction, rule, ruling, Lien,
voting right, consent of or by an Authority.

-54-

 

          “Overlap Period” means a taxable year or other taxable period that begins on
or before the Closing Date and ends after the Closing Date.

          “Permits” means all permits, licenses, registrations, certificates,
Orders, qualifications or approvals required by any Authority or other Person.

          “Permitted Liens” means (a) statutory Liens not yet delinquent and immaterial in
amount; (b) such imperfections or irregularities of title or Liens as do not materially detract
from or interfere with the present use of the properties or assets subject thereto or affected
thereby, otherwise impair present business operations at such properties, or do not detract from
the value of such properties and assets; ( c) Liens reflected in the Financial Statements or the
notes thereto; (d) the rights of customers of the Corporation with respect to inventory or work in
progress under purchase orders or Contracts entered into by the Corporation in the ordinary course
of business; (e) mechanics’, carriers’, workers’, repairmen’s, warehousemen’s, or other similar
Liens arising in the ordinary course of business in respect of obligations not overdue and
immaterial in amount or which arc being contested in good faith and covered by a bond in an amount
at least equal to the amount of the Lien; and (f) deposits or pledges to secure workmen’s
compensation, unemployment insurance, old age benefits or other social security obligations in
connection with, or to secure the performance of, bids, tenders, trade Contracts not for the
payment of money or leases, or to secure statutory obligations or surety or appeal bonds or other
pledges or deposits for purposes of like nature in the ordinary course of business and immaterial
in amount.

          “Person” means any corporation, partnership, joint venture, limited liability
company, organization, entity, Authority or natural person.

          “Policies” means all Contracts that insure (a) the Corporation’s or any of its
Subsidiaries, properties, plant and equipment for loss or damage; and (b) the Corporation or any
of its Subsidiaries or their officers, directors, employees or agents against any liabilities,
losses or damages (or lost profits) for any reason or purpose.

          “Private Placement” means that certain offering of up to 2,000,000 shares of
Purchaser Common Stock for a maximum aggregate amount equal to $5,000,000 pursuant to the terms
and conditions set forth in the Private Placement Memorandum.

          “Private Placement Memorandum” means that certain Confidential Private Placement
Memorandum, dated as of March 9, 2005, as amended by that certain Amended and Restated
Confidential Private Placement Memorandum, dated as of March 30, 2005, and as may be amended or
supplemented, describing the Private Placement.

          “Purchaser” shall have the meaning set forth in the
preamble.

          “Purchaser Board Approval” shall have the meaning set forth in Section
3.22.

          “Purchaser Common Stock” shall have the meaning set forth in Section
1.8.

          “Purchaser Shareholders’ Approval” shall have the meaning set forth in
Section
3.23.

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     “Purchaser Stock Option Plan” shall have the meaning set forth in
Section 3.5.

     “Regulation” means any rule, law, code, statute, regulation, ordinance, requirement,
announcement, policy, guideline, rule of common law or other binding action of or by an Authority
and any judicial interpretation thereof.

     “Restructuring” shall have the meaning set forth in
Section 5.17.

     “Rules” shall have the meaning set forth in Section
11.17.

     “SEC” shall mean the Securities and Exchange
Commission.

     “Securities Act” shall have the meaning set forth in
Section 2.25.

     “Sel1ers” shall have the meaning set forth in the
preamble.

     “Server” shall have the meaning set forth in Section
2.16(j).

     “SESI” shall have the meaning set forth in Section
2.7(a).

     “SESLLC” shall have the meaning set forth in Section
2.7(a).

     “Shares” shall have the meaning set forth in Section
1.8(c).

     “Sites” shall have the meaning set forth in
2.16(j).

     “Subsidiary” any Person in which the Corporation has (a) an Investment; (b)
advanced funds or provided financial accommodations to which, in each case, is secured by an
Investment in; or (c) has an Option to acquire an Investment in such Person.

     “Surviving Corporation” shall have the meaning set forth in
Section 1.1.

     “Tax Returns” shall have the meaning set forth in Section
2.13(a).

     “Tamborine Majority Shareholder” shall have the meaning set forth in
Section
1.8(c).

     “Taxes” shall mean all taxes, assessments, charges, duties, fees, levies or other
governmental charges, including, without limitation, all Federal, state, local, foreign and other
income, franchise, profits, gross receipts, capital gains, capital stock, transfer, property,
sales, use, value-added, occupation, property, excise, severance, windfall profits, stamp,
license, payroll, social security, withholding and other taxes, assessments, charges, duties,
fees, levies or other governmental charges of any kind whatsoever (whether payable directly or by
withholding and whether or not requiring the filing of a Tax Return), all estimated taxes,
deficiency assessments, additions to tax, penalties and interest and shall include any liability
for such amounts as a result either of being a member of a combined, consolidated, unitary or
affiliated group or of a contractual obligation to indemnify any person or other entity.

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          “Taxing Authorities” means Internal Revenue Service and any other Federal,
state, or local Authority which has the right to impose Taxes on the Corporation or the Sellers.

          “VEBA” shall have the meaning set forth in Section
2.15(a).

          11.4. Notices. All notices, requests, demands and other communications required or
permitted hereunder shall be in writing and shall be deemed to have been duly given (a) one (1)
business day after being delivered by hand, (b) five (5) business days after being mailed first
class or certified with postage paid or (c) one (1) business day after being couriered by
overnight receipted courier service:

          (a) If to the Corporation or the Sellers, to:

Synthesis Energy Holdings, Inc.

1424 West 28th Street

Miami Beach, Florida 33140 Attn:

Lorenzo C. Lamadrid

and

Synthesis Energy Holdings, Inc.

Level 21 HSBC Tower — 21 Yin Cheng E Road

Shanghai 200120 China

Attn: Donald P. Bunnell

          (b) If to the Purchaser, to:

Tamborine Holdings, Inc.

1450 Fifth Avenue

Suite 2200

Seattle, Washington 98101

Attn: Alexander E. Gomez

or to such other Person or address as the Purchaser shall furnish by notice to the Corporation in
writing.

     11.5. Assignment. This Agreement and all of the provisions hereof shall be binding
upon and inure to the benefit of the parties hereto and their respective successors and permitted
assigns, but neither this Agreement nor any of the rights, interests or obligations hereunder
shall be assigned by any of the parties hereto without the prior written consent of the other
parties.

     11.6. Governing Law. The Agreement shall be governed by the internal laws of the
State of Florida as to all matters, including but not limited to matters of validity,
construction, effect and performance.

     11.7. Counterparts. This Agreement may be executed in two or more counterparts
(including by means of telecopied signature pages), each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument. Counterpart signatures

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need not be on the same page and shall be deemed effective upon receipt. If this Agreement
is executed by the Purchaser and one or more Sellers, it shall be deemed to be a valid Contract
as between 3l1d among such signatories notwithstanding that other
Sellers may be named herein.
Sellers subsequently executing this Agreement shall become parties hereto as and when their
executed signature pages are delivered to the Purchaser and the Corporation.

     11.8. Headings. The article and section headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.

     11.9. Entire Agreement. This Agreement, including the schedules and exhibits hereto
and the Contracts, documents, certificates and instruments referred to herein, embodies the entire
agreement and understanding of the parties hereto in respect of the transactions contemplated by
this Agreement and supersedes all prior Contracts, representations, warranties, promises,
covenants, arrangements, communications and understandings, oral or written, express or implied,
between the parties with respect to such transactions. There are no Contracts, representations,
warranties, promises, covenants, arrangements or understandings between the parties with respect
to the transactions contemplated hereby, other than those expressly set forth or referred to
herein.

     11.10. Injunctive Relief. The parties hereto agree that in the event of a breach
of any provision of this Agreement or a failure by a party to perform in accordance with the
specific
terms herein, the aggrieved party or parties may be damaged irreparably and without an adequate
remedy at law. The parties therefore agree that in the event of a breach of any provision of this
Agreement, the aggrieved party or parties may elect to institute and prosecute proceedings in any
court of competent jurisdiction to enforce specific performance or to enjoin the continuing breach
of such provision without the requirement of a posting of a bond, as well as to obtain damages for
breach of this Agreement. By seeking or obtaining any such relief, the aggrieved party shall not
be precluded from seeking or obtaining any other relief to which it may be entitled.

     11.11. Delays or Omissions. No delay or omission to exercise any right, power or
remedy accruing to any party hereto, upon any breach or default of any other party under this
Agreement, shall impair any such right, power or remedy of such party nor shall it be construed to
be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar
breach or default thereafter occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver,
permit, consent or approval of any kind or character on the part of any party hereto of any breach
or default under this Agreement, or any waiver on the part of any party of any provisions or
conditions of this Agreement must be made in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this Agreement or by law or
otherwise afforded to any party, shall be cumulative and not alternative.

     11.12. Severability. Wherever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable Regulations, but if any
provision of this Agreement or the application of any such provision to any Person or
circumstance shall be held to be prohibited by, illegal or unenforceable under applicable law in

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any respect by a court of competent jurisdiction, such provision shall be ineffective only to
the extent of such prohibition or illegality or unenforceability, without invalidating the
remainder of such provision or the remaining provisions of this Agreement.

     11.13. Expenses. The Purchaser and the Corporation (for itself and on behalf of
the Sellers) shall each bear its own expenses, including without limitation, legal fees and
expenses, with respect to this Agreement and the transactions contemplated hereby. If any legal
action or other proceeding relating to this Agreement, the agreements contemplated hereby, the
transactions contemplated hereby or thereby or the enforcement of any provision of this
Agreement or the agreements contemplated hereby is brought against any party, the prevailing
party in such action or proceeding shall be entitled to recover all reasonable expenses relating
thereto (including attorney’s fees and expenses) from the party against which such action or
proceeding is brought in addition to any other relief to which such prevailing party may be
entitled.

     11.14. No Third Party Beneficiaries. This Agreement is for the sole benefit of the
parties and their permitted successors and assigns and nothing herein express or implied shall be
construed to give any person, other than the parties of such permitted successors and assigns, any
legal or equitable rights hereunder.

     11.15. Schedules. No exceptions to any representations or warranties disclosed on
one schedule shall constitute an exception to any other representation or warranties made in this
Agreement unless the substance of such exception is disclosed as provided herein on each such
applicable schedule or a specific cross reference to a disclosure on another schedule is made. All
schedules and exhibits attached hereto or referred to herein are hereby incorporated in and made a
part of this Agreement as if set forth in full herein.

     11.16. No Strict Construction. The parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly by the parties, and
no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any of the provisions of this Agreement.

     11.17. Dispute Resolution. If the parties should have a dispute arising out of or
relating to this Agreement or the parties’ respective rights and duties hereunder, then the
parties will resolve such dispute in the following manner: (i) any party may at any time deliver
to the others a written dispute notice setting forth a brief description of the issue for which
such notice initiates the dispute resolution mechanism contemplated by this Section 11.17; (ii)
during the forty-five (45) day period following the delivery of the notice described in Section
11.17(i) above, appropriate representatives of the various parties will meet and seek to resolve
the disputed issue through negotiation, (iii) if representatives of the parties arc unable to
resolve the disputed issue through negotiation, then within fifteen (15) days after the period
described in
Section 11.17(ii) above, the parties will refer the issue (to the exclusion of a court of law) to
final and binding arbitration in Miami, Florida in accordance with the then existing rules (the
“Rules”) of the American Arbitration Association (“AAA”), and judgment upon the
award rendered by the arbitrators may be entered in any court having jurisdiction thereof;
provided, however, that the
law applicable to any controversy shall be the law of the State of Florida, regardless of
principles

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of conflicts of laws; provided, further, that the foregoing provisions of
this Section 11.17 shall not apply with respect to any equitable or prejudgment remedies
available to a party hereunder or pursuant to any applicable law. In any arbitration pursuant to
this Agreement, (i) discovery shall be allowed and governed by the Florida Rules of Civil
Procedure and (ii) the award or decision shall be rendered by a majority of the members of a
Board of Arbitration consisting of three (3) members, one of whom shall be appointed by each of
the respective parties and the third of whom shall be the chairman of the panel and be appointed
by mutual agreement of said two party-appointed arbitrators. In the event of failure of said two
arbitrators to agree within thirty (30) days after the commencement of the arbitration
proceeding upon the appointment of the third arbitrator, the third arbitrator shall be appointed
by the AAA in accordance with the Rules. In the event that either party shall fail to appoint an
arbitrator within fifteen (15) days after the commencement of the arbitration proceedings, such
arbitrator and the third arbitrator shall be appointed by the AAA in accordance with the Rules.
Nothing set forth above shall be interpreted to prevent the parties from agreeing in writing to
submit any dispute to a single arbitrator in lieu of a three (3) member Board of Arbitration.
Upon the completion of the selection of the Board of Arbitration (or if the parties agree
otherwise in writing, a single arbitrator), an award or decision shall be rendered within no
more than thirty (30) days.

Notwithstanding the foregoing, the request by either party for preliminary or permanent
injunctive relief, whether prohibitive or mandatory, shall not be subject to arbitration and
may be adjudicated only by the courts of the State of Florida or the Federal District Court
for the Southern District of Florida. EACH PARTY HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MA Y LEGALLY AND EFFECTIVELY DO SO, TRIAL BY
WRY IN ANY SUIT, ACTION OR PROCEEDING ARISING HEREUNDER.

     11.18. Arm’s Length Negotiations. Each party herein expressly represents and
warrants to all other parties hereto that (a) before executing this Agreement, said party has
fully informed itself of the terms, contents, conditions and effects of this Agreement; (b)
said party has relied solely and completely upon its own judgment in executing this Agreement;
(c) said party has had the opportunity to seek and has obtained the advice of counsel before
executing this Agreement; (d) said party has acted voluntarily and of its own free will in
executing this Agreement; ( e) said party is not acting under duress, whether economic or
physical, in executing this Agreement; and (f) this Agreement is the result of arm’s length
negotiations conducted by and among the parties and their respective counsel.

*****

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     IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement and Plan
of Merger to be executed and delivered on its behalf by one of its duly authorized officers,
all as of the day and year first above written.

	 	 	 	 	 	 	 
	 	 	TAMBORINE HOLDINGS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Alexander E. Gomez
 

Alexander E. Gomez
	 	 
	 

	 	Title:
	 	President	 	 
	 
	 	 	 	 	 	 
	 	 	SES ACQUISITION CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Alexander E. Gomez
 

Alexander E. Gomez
	 	 
	 

	 	Title:
	 	President	 	 
	 
	 	 	 	 	 	 
	 	 	SYNTHESIS ENERGY HOLDINGS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lorenzo Lamadrid
 

	 	 
	 

	 	Name:	 	Lorenzo Lamadrid	 	 
	 

	 	Title:	 	Chairman	 	 
	 
	 	 	 	 	 	 
	 	 	SELLERS:	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Lorenzo Lamadrid	 	 
	 	 	 	 	 
	 	 	Lorenzo Lamadrid	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Gregory B. Golden	 	 
	 	 	 	 	 
	 	 	Gregory B. Golden	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Donald P. Bunnell	 	 
	 	 	 	 	 
	 	 	Donald P. Bunnell	 	 

-61-

 

	 	 	 	 	 	 	 
	 	 	/s/ Fred A. Breidenbach	 	 
	 	 	 	 	 
	 	 	Fred A. Breidenbach	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Huang Da Li	 	 
	 	 	 	 	 
	 	 	Huang Da Li	 	 
	 
	 	 	 	 	 	 
	 	 	AZURE INTERNATIONAL HOLDINGS LTD.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen M. Terry	 	 
	 	 	 	 	 	 	 
	 

	 	Name:	 	Stephen M. Terry	 	 
	 

	 	Title:	 	Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Chen Xiao Dong	 	 
	 	 	 	 	 
	 	 	Chen Xiao Dong	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Wang Yi	 	 
	 	 	 	 	 
	 	 	Wang Yi	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Alexander Gomez	 	 
	 	 	 	 	 
	 	 	Alexander Gomez (solely with respect to
Section 5.14 of this Agreement)	 	 

-62-exv10w2

 

Exhibit 10.2

First Amendment to the Amended and Restated Agreement and Plan of Merger

     This First Amendment to the Amended and Restated Agreement and Plan of Merger (this
“Amendment”) is made effective as of December 29, 2006 by and among Synthesis Energy Systems, Inc., a
Delaware corporation (“SES”) f/k/a Tamborine Holdings, Inc., a Mississippi corporation
(“Tamborine”), SES Acquisition Corporation, a Florida corporation (“Acquisition”),
Synthesis Energy Holdings, Inc., a Florida corporation (“Synthesis Florida”), and the
shareholders of Synthesis Florida listed on the signature page hereto (the “Shareholders”).

Recitals

     A. Tamborine, Acquisition, Synthesis Florida and the Shareholders entered into that certain
Amended and Restated Agreement and Plan of Merger dated April 4, 2005 (the “Agreement”)
pursuant to which Acquisition was merged with and into Synthesis Florida (the “Merger”),
with Synthesis Florida as the surviving corporation of the merger and the successor to Acquisition.

     B. Pursuant to Section 1.8(c) of the Agreement, at the effective time of the Merger, all of
the outstanding shares of common stock of Synthesis Florida were converted into 21,050,000 shares
of common stock of Tamborine.

     C. Section 1.8(c) of the Agreement should have stated that the outstanding shares of common
stock of Synthesis Florida were converted into 21,000,000 shares of common stock of Tamborine, and
in fact 21,000,000 shares of common stock were issued to the Shareholders.

     D. Subsequent to the Merger, Tamborine reincorporated in Delaware and changed its name to
“Synthesis Energy Systems, Inc.”

     E. SES has requested that the Agreement be amended to reflect that the outstanding shares of
common stock of Synthesis Florida were actually converted into 21,000,000 shares of common stock of
Tamborine at the effective time of the Merger.

     F. Pursuant to Section 11.1 of the Agreement, the Agreement may only be amended by the written
agreement of all of the parties thereto.

     G. All of the parties to the Agreement have agreed to make the requested change, and the
purpose of this Amendment is to amend the Agreement in order to reflect this change.

     H. The defined terms used in this Amendment shall have the same meaning as set forth in the
Agreement, unless otherwise indicated in this Amendment.

     NOW, THEREFORE, in consideration of the premises and the mutual promises made herein,
and in consideration of representations, warranties, and covenants contained herein and in the
Agreement, the parties agree as follows:

     Section 1. Section 1.8(c) of the Agreement is hereby amended so that all references to
“21,050,000 shares of the Purchaser Common Stock” shall now be read as “21,000,000 shares of the
Purchaser Common Stock.”

     Section 2. Except as set forth herein, the Agreement shall remain in full force and effect.

     Section 3. This Amendment shall be binding upon and inure to the benefit of each of the
undersigned and their respective successors and permitted assigns.

 

 

     Section 4. This Amendment may be executed in any number of counterparts with the same effect
as if all signatories had signed the same document. All counterparts must be construed together to
constitute one and the same instrument. This Amendment may be transmitted and signed by facsimile.
The effectiveness of any such documents and signatures shall, subject to applicable law, have the
same force and effect as manually-signed originals and shall be binding on all parties hereto.

[Signature Pages Follow]

 

 

     In Witness Whereof, SES, as the successor to Tamborine, Acquisition, SES Florida and
the Shareholders have executed this Amendment all as of December 29, 2006.

	 	 	 	 	 	 	 	 	 
	 	 	Synthesis
Energy Systems, Inc. f/k/a Tamborine
Holdings, Inc.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Timothy E. Vail	 	 
	 

	 	 	 	 	 	 

Name:  Timothy E. Vail
	 	 
	 

	 	 	 	 	 	Title:  President
and Chief Executive Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SES Acquisition Corporation	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Synthesis
Energy Holdings, Inc., for itself and

as successor by merger to SES Acquisition

Corporation	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Donald P. Bunnell	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:  Donald P. Bunnell	 	 
	 

	 	 	 	 	 	Title:  President and
Chief Executive Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	The Shareholders:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	/s/ Lorenzo Lamadrid	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Lorenzo Lamadrid	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	/s/ Gregory B. Golden	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Gregory B. Golden	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	/s/ Donald P. Bunnell	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Donald P. Bunnell	 	 
	 
	 	 	 	 	 	 	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	
/s/ Fred A. Breidenbach

Fred A. Breidenbach	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	/s/
Huang Da Li	 	 
	 	 	 	 	Huang Da Li	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Azure International Holdings Ltd.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Stephen M. Terry	 	 
	 

	 	 	 	 	 	 

Name: Stephen M. Terry
	 	 
	 

	 	 	 	 	 	Title: Finance Director	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	/s/
Chen Xiao Dong	 	 
	 	 	 	 	Chen Xiao Dong	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	/s/
Wang Yi	 	 
	 	 	 	 	Wang Yi	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	/s/
Alexander Gomez	 	 
	 	 	 	 	Alexander Gomez

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