THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is dated
March 31, 1997, and is by and between Gaensel Gold Mines, Inc., a Nevada
corporation (the "Company") and Magellan Capital Corporation ("Shareholder").
R E C I T A L S
WHEREAS, the Shareholder owns all of the Common Stock of Lifeline Medical
Information Systems, Inc. ("Lifeline") (the "Lifeline Shares");
WHEREAS, the Company is a reporting public company; and
WHEREAS, the Company desires to acquire all of the Lifeline Shares, and
the Shareholder desires to exchange all of the Lifeline Shares for shares of
voting common stock of the Company, in a transaction that qualifies under
Section 368(a) (1)(B) of the Internal Revenue Code of 1986, as amended (the
"Code").
A G R E E M E N T
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and in reliance upon the representations and warranties
hereinafter set forth, the parties agree as follows:
I. EXCHANGE OF THE SHARES AND CONSIDERATION
1.01. Shares Being Exchanged. Effective on execution of
this Agreement, and
subject to the terms and conditions of this Agreement the Shareholder hereby
assigns, transfers
and delivers to the Company all of the Lifeline Shares which it owns.
1.02. Consideration. Subject to the terms and conditions of this
Agreement and in consideration of the assignment and delivery of Lifeline Shares
to the Company, the Company hereby issues an aggregate of 800,000 shares of
voting common stock ("Company Common Stock") of the Company, $.001 par value per
share (the "Company Shares"), including 625,000 shares to Shareholder and the
balance to various consultants and advisors.
1.03. Filings. The Company and Shareholders shall file the
following documents:
1.03(a) A Current Report on Form 8-K with the U.S. Securities
and Exchange
Commission as required by law.
1.04(b) A Certificate of Amendment to the Articles of
Incorporation of the Company, changing the name of the Company to
"Lifeline International, Inc." or any name selected by Shareholder.
II. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS
Shareholder and Lifeline represent and warrant to the Company as
follows, as of the date of this Agreement and as of the Closing:
2.01. Organization.
2.01(a). Lifeline is a corporation duly organized, validly
existing and in good standing under the laws of the State of Nevada;
Lifeline has the corporate power and authority to carry on its business
as presently conducted; and Lifeline is qualified to do business in all
jurisdictions where the failure to be so qualified would have a
material adverse effect on its business.
2.02. Capitalization.
2.02(a). The authorized capital stock and the issued and
outstanding shares of Lifeline is all owned by Shareholder. All of the
issued and outstanding shares of Lifeline are duly authorized, validly
issued, fully paid and nonassessable.
2.02(b). There are no outstanding options, warrants, or
rights to purchase any
securities of Lifeline.
2.03. Subsidiaries and Investments. Lifeline has no investment in any
other corpor-
ation, partnership or other form of business organization.
2.04. Financial Statements. The financial statements of Lifeline since
inception, including the unaudited balance sheet as of March 31, 1997 and the
related unaudited statements of operations, retained earnings, and cash flows
for the years then ended (the "Financial Statements") present fairly the
financial position and results of operations of Lifeline, on a consistent basis.
The financial records of Lifeline are of such a character and quality that an
unqualified (except as to going concern) audit for period inception to March 31,
1997 be performed within 75 days of the Closing.
2.05. No Undisclosed Liabilities. Lifeline is not subject to any
material liability or obligation of any nature, whether absolute, accrued,
contingent, or otherwise and whether due or to become due, which is not
reflected or reserved against in the Financial Statements, except those incurred
in the normal course of business.
2.06. Absence of Material Changes. Since March 31, 1997, except as
described in any Exhibit hereto or as required or permitted under this
Agreement, there has not been any material change in the condition (financial or
otherwise) of the properties, assets, liabilities or business of Lifeline,
except changes in the ordinary course of business which, individually and in the
aggregate, have not been materially adverse.
2.07. Litigation. There is no litigation, proceeding or investigation
pending or threatened against Lifeline affecting any of its properties or assets
against any officer, director, or stockholder of Lifeline that might result,
either in any case or in the aggregate, in any material adverse change in the
business, operations, affairs or condition of Lifeline or its properties or
assets, or that might call into question the validity of this Agreement, or any
action taken or to be taken pursuant hereto.
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2.08. Title To Assets. Lifeline has good and marketable title to all of
its assets and properties now carried on its books including those reflected in
the balance sheets contained in the Financial Statements, free and clear of all
liens, claims, charges, security interests or other encumbrances, except as
described the Financial Statements.
2.09. Real Estate. Lifeline holds no real estate asset.
2.10. Contracts and Undertakings. Each Lifeline contract, agreement,
lease, license, arrangement, commitment and undertaking is valid, binding and in
full force and effect. Lifeline is not in material default, or alleged to be in
material default, under any contract, agreement, lease, license, commitment,
instrument or obligation and no other party to any contract, agreement, lease,
license, commitment, instrument or obligation to which Lifeline is a party is in
default thereunder nor does there exist any condition or event which, after
notice or lapse of time or both, would constitute a default by any party to any
such contract, agreement, lease, license, commitment, instrument or obligation.
2.11. Underlying Documents. Copies of all documents described in any
Exhibit
attached hereto (or a summary of any such contract, agreement or commitment, if
oral) have
been made available to the Company and are complete and correct and include all
amendments,
supplements or modifications thereto.
2.12. No Conflict. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not conflict with or
result in a breach of any term or provision of, or constitute a default under,
the charter documents of Lifeline, or any agreement, contract or instrument to
which Lifeline is a party or by which it or any of its assets are bound.
2.13. Ownership of Intellectual Property Rights. Lifeline own or has
valid right or license to use all patents, patent rights, trade secrets,
trademarks, trademark rights, trade names, trade name rights, copyrights and
other intellectual property rights (collectively referred to as "Intellectual
Property Rights") which are necessary to operate its business as now operated
and as now proposed to be operated. Except as disclosed in the financial
statements, Lifeline does not have any obligation to compensate any person,
firm, corporation or other entity for the use of any such Intellectual Property
Rights, nor has Lifeline granted to any person, firm, corporation or other
entity any license or other rights to use in any manner, or waived its rights
with respect to any Intellectual Property Rights of Lifeline.
2.14. Disclosure. To the actual knowledge of Lifeline, neither this
Agreement, the Financial Statements nor any other agreement, document,
certificate or written or oral statement furnished to the Company by or on
behalf of Lifeline in connection with the transactions contemplated hereby,
contains any untrue statement of a material fact or when taken as a whole omits
to state a material fact necessary in order to make the statements contained
herein or therein not misleading.
2.15. Authority. Lifeline has full power and authority to enter
into this Agreement
and to carry out the transactions contemplated herein. The execution and
delivery of this
Agreement and the consummation of the transactions contemplated hereby, have
been duly
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authorized and approved by the Board of Directors of Lifeline and no other
corporate proceedings on the part of Lifeline is necessary to authorize this
Agreement and the transactions contemplated hereby.
III. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Shareholders as follows,
as of the date of this Agreement and as of the Closing:
3.01. Organization. The Company is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Nevada;
has the corporate power and authority to carry on its business as presently
conducted; and is qualified to do business in all jurisdictions where the
failure to be so qualified would have a material adverse effect on the business
of the Company.
3.02. Capitalization of the Company. The authorized capital stock of
the Company consists of 50,000,000 shares of Common Stock, par value $.0001 per
share, of which approximately 218,379 shares are outstanding, and no shares of
preferred stock. All outstanding shares are duly authorized, validly issued,
fully paid and non-assessable.
3.03. Subsidiaries and Investments. The Company does not own any
capital stock
or have any interest in any corporation, partnership, or other form of business
organization,
except as disclosed in the Financial Statements.
3.04. Authority. The Company has full power and authority to enter into
this Agreement and to carry out the transactions contemplated herein. The
execution and delivery of this Agreement, the consummation of the transactions
contemplated hereby, and the issuance of the Company Common Stock in accordance
with the terms hereof, have been duly authorized and approved by the Board of
Directors of the Company and no other corporate proceedings on the part of
Company are necessary to authorize this Agreement and the transactions
contemplated hereby.
3.05. No Undisclosed Liabilities. The Company is not subject to any
material liability
or obligation of any nature, whether absolute, accrued, contingent, or otherwise
and whether due
or to become due.
3.06. Litigation. There is no litigation, proceeding or investigation
pending or to the knowledge of the Company, threatened against the Company
affecting any of its properties or assets, or, to the knowledge of the Company,
against any officer, director, or stockholder of the Company that might result,
either in any case or in the aggregate, in any material adverse change in the
business, operations, affairs or condition of the Company or any of its
properties or assets, or that might call into question the validity of this
Agreement, or any action taken or to be taken pursuant hereto.
3.07. Title To Assets. The Company has good and marketable title to
all of its assets
and properties now carried on its books including those reflected in the balance
sheet contained
in the Company's financial statements, free and clear of all liens, claims,
charges, security
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interests or other encumbrances, except as described in the balance sheet
included in the Com-pany's financial statements or on any Exhibits attached
hereto.
3.08. Contracts and Undertakings. Each of the Company's contracts,
agreements, leases, licenses, arrangements, commitments and undertakings is
valid, binding and in full force and effect. The Company is not in material
default, or alleged to be in material default, under any contract, agreement,
lease, license, commitment, instrument or obligation and, to the knowledge of
the Company, no other party to any contract, agreement, lease, license,
commitment, instrument or obligation to which the Company is a party is in
default thereunder nor, to the knowledge of the Company, does there exist any
condition or event which, after notice or lapse of time or both, would
constitute a default by any party to any such contract, agreement, lease,
license, commitment, instrument or obligation.
3.09. Underlying Documents. Copies of all documents described in any
Exhibit
attached hereto (or a summary of any such contract, agreement or commitment, if
oral) have
been made available to Shareholder and are complete and correct and include all
amendments,
supplements or modifications thereto.
3.10. No Conflict. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not conflict with or
result in a breach of any term or provision of, or constitute a default under,
the Certificate of Incorporation or Bylaws of the Company, or any agreement,
contract or instrument to which the Company is a party or by which it or any of
its assets are bound.
3.11. Disclosure. To the actual knowledge of the Company, neither this
Agreement nor any other agreement, document, certificate or written or oral
statement furnished to Shareholder and the Shareholders by or on behalf of the
Company in connection with the transactions contemplated hereby, contains any
untrue statement of a material fact or when taken as a whole omits to state a
material fact necessary in order to make the statements contained herein or
therein not misleading.
3.12. Financial Statements. The financial statements of the Company
set forth present
fairly the financial position and results of operations of the Company, on a
consistent basis. As
of the Closing, Company shall have no liabilities.
IV. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS
All representations, warranties and covenants of the Company and
Shareholder contained herein shall survive the consummation of the transactions
contemplated herein and remain in full force and effect.
V. CONDITIONS TO CLOSING
5.01. Conditions to Obligation of Shareholders. The obligations of
Shareholders
under this Agreement shall be subject to each of the following conditions:
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5.01(a) Representations and Warranties of Company to be True.
The representations and warranties of Company herein contained shall be
true in all material respects at the Closing with the same effect as
though made at such time. Company shall have performed in all material
respects all obligations and complied in all material respects, to its
actual knowledge, with all covenants and conditions required by this
Agreement to be performed or complied with by it at or prior to the
Closing.
5.01(b) No Legal Proceedings. No injunction or restraining
order shall be in effect, and no action or proceeding shall have been
instituted and, at what would otherwise have been the Closing, remain
pending before a court to restrain or prohibit the transactions
contemplated by this Agreement.
5.01(c) Statutory Requirements. All statutory requirements for
the valid consummation by Company of the transactions contemplated by
this Agreement shall have been fulfilled. All authorizations, consents
and approvals of all Governments and other persons required to be
obtained in order to permit consummation by Company of the transactions
contemplated by this Agreement, to continue unimpaired in all material
respects immediately following the Closing shall have been obtained.
5.02. Conditions to Obligations of Company. The obligation of
Company under this
Agreement shall be subject to the following conditions:
5.02(a) Representations and Warranties of Shareholders to be
True. The representations and warranties of Shareholder herein
contained shall be true in all material respects as of the Closing, and
shall have the same effect as though made at the Closing; Shareholders
shall have performed in all material respects all obligations and
complied in all material respects, to its actual knowledge, with all
covenants and conditions required by this Agreement to be performed or
complied with by it prior to the Closing.
5.02(b) No Legal Proceedings. No injunction or restraining
order shall be in effect prohibiting this Agreement, and no action or
proceeding shall have been instituted and, at what would otherwise have
been the Closing, remain pending before the court to restrain or
prohibit the transactions contemplated by this Agreement.
5.02(c) Statutory Requirements. All statutory requirements for
the valid consummation by Shareholders of the transactions contemplated
by this Agreement shall have been fulfilled; all authorizations,
consents and approvals of all Governmental agencies and authorities
required to be obtained in order to permit consummation by Shareholders
of the transactions contemplated by this Agreement shall have been
obtained.
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VI. TERMINATION OF OBLIGATIONS AND WAIVERS OF CONDITIONS;
PAYMENT OF EXPENSES
6.01. Termination of Agreement. Anything herein to the contrary
notwithstanding,
this Agreement, may be terminated by mutual consent of Shareholder and Company
and in no
other matter.
6.02. Payment of Expenses; Waiver of Conditions. In the event that this
Agreement shall be terminated pursuant to Section 6.01 all obligations of the
parties under this Agreement shall terminate and there shall be no liability of
any party to the other. Each party hereto will pay all costs and expenses
incident to its negotiation and preparation of this Agreement and performance of
and compliance with all agreements and conditions contained herein or therein on
its part to be performed or complied with, including the fees, expenses and
disbursements of counsel. If any of the conditions specified in Section 5.01
hereof has not been satisfied, Shareholders may nevertheless at the election of
Shareholders proceed with the transactions contemplated hereby and if any of the
conditions specified in Section 5.02 hereof has not been satisfied, Company may
nevertheless at its election proceed with the transactions contemplated hereby.
In the event that the Closing shall be consummated, each party hereto will pay
all of its costs and expenses in connection therewith.
VII. CERTAIN AGREEMENTS
7.01. Reporting Requirements. The Company shall file all reports
required by the Securities Exchange Act of 1934 and shall maintain its books and
records in accordance with Sections 12 and 13 thereof. The parties agree that
the failure of the Company to make such filings or to so maintain its books and
records shall constitute a material breach of this Agreement.
VIII. MISCELLANEOUS
8.01. Finder's Fees, Investment Banking Fees. Neither Shareholder nor
the Company have retained or used the services of any person, firm or
corporation in such manner as to require the payment of any compensation as a
finder or a broker in connection with the transactions contemplated herein,
except for shares of Company Common Stock issued at Closing to the persons
listed on Schedule I.
8.02. Tax Treatment. The transaction contemplated hereby is intended to
qualify as a so-called "tax-free" reorganization under the provisions of Section
368 of the Internal Revenue Code. Company and Shareholder acknowledge, however,
that they each have been represented by their own tax advisors in connection
with this transaction; that neither has made any representation or warranty to
the other with respect to the treatment of such transaction or the effect
thereof under applicable tax laws, regulations, or interpretations; and that no
attorney's opinion or private revenue ruling has been obtained with respect to
the effects thereof under the Internal Revenue Code of 1986, as amended.
8.03. Further Assurances. From time to time, at the other party's
request and without
further consideration, each of the parties will execute and deliver to the
others such documents
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and take such action as the other party may reasonably request in order to
consummate more effectively the transactions contemplated hereby.
8.04. Parties in Interest. Except as otherwise expressly provided
herein, all the terms and provisions of this Agreement shall be binding upon,
shall inure to the benefit of and shall be enforceable by the respective heirs,
beneficiaries, personal and legal representatives, successors and assigns of the
parties hereto.
8.05. Entire Agreement; Amendments. This Agreement, including the
Schedules, Exhibits and other documents and writings referred to herein or
delivered pursuant hereto, which form a part hereof, contains the entire
understanding of the parties with respect to its subject matter. There are no
restrictions, agreements, promises, warranties, covenants or undertakings other
than those expressly set forth herein or therein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to its
subject matter. This Agreement may be amended only by a written instrument duly
executed by the parties or their respective successors or assigns.
8.06. Headings, Etc. The section and paragraph headings contained in
this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretations
of this Agreement.
8.07. Pronouns. All pronouns and any variations thereof shall be
deemed to refer to
the masculine, feminine or neuter, singular or plural, as the identity of the
person, persons,
entity or entities may require
8.08. Counterparts. This Agreement may be executed in several
counterparts, each
of which shall be deemed an original but all of which together shall constitute
one and the same
instrument.
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8.09. Governing Law. This Agreement shall be governed by the laws of
the State of
Nevada applicable to contracts to be performed in the State of Nevada.
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the parties hereto as the date first above written.
GAENSEL GOLD MINES, INC.
By:
Name: Xxxxxxx X. Xxxx
Title: President
SHAREHOLDERS
MAGELLAN CAPITAL CORPORATION
By:
Name Xxxxxxx X. Xxxx
Title: President
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SCHEDULE I
NUMBER OF SHARES NUMBER OF
OF SHAREHOLDER SHARES OF
COMMON STOCK COMPANY
NAMES OF OWNED AND COMMON STOCK
SHAREHOLDERS TO BE DELIVERED TO BE RECEIVED
Magellan Capital
Corporation 50,000 625,000
Totals 50,000 625,000
175,000 Shares shall be issued to finders.
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