ACQUISITION AGREEMENT
BETWEEN
Genesis Capital Corporation of Nevada
AND
Power Exploration, Inc.
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ACQUISITION AGREEMENT
TABLE OF CONTENTS
Purchase and Sale.............................................................2
Purchase Price................................................................2
Warranties and Representations of Genesis ....................................2
Warranties and Representations of Power.......................................5
Term..........................................................................7
The Power Shares..............................................................7
Conditions Precedent to Closing...............................................7
Termination...................................................................8
Exhibits......................................................................8
Miscellaneous Provisions......................................................8
Closing.......................................................................9
Effective Date ...............................................................9
Governing Law.................................................................9
Counterparts..................................................................9
Index to Exhibits ...........................................................10
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ACQUISITION AGREEMENT
THIS ACQUISITION AGREEMENT dated February ___, 2000, by, between and
among Genesis Capital Corporation of Nevada, a Nevada Corporation ("Genesis"),
and Power Exploration, Inc., a Nevada corporation, ("Power").
WHEREAS, Genesis owns 100% of the issued and outstanding shares of The
Lincoln Health Fund, Inc., a Delaware corporation ("Lincoln"); and
WHEREAS, Genesis desires to sell and Power desires to purchase one hundred
(100%) percent of such shares;
NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties herein contained, the parties hereby agree as
follows:
I. Purchase and Sale. Genesis hereby agrees to sell, transfer, assign and
convey to Power and Power hereby agrees to purchase and acquire from
Genesis, one hundred (100%) percent of the issued and outstanding common
stock of Lincoln (the "Lincoln Shares"), which shares are owned by Genesis,
in a reorganization that is intended to be a tax-free exchange of shares of
stock.
II. Purchase Price. The aggregate purchase price to be paid by Power for the
Lincoln Shares shall be 600,000 shares of Power common voting stock (the
"Power Purchase Shares").
III. Warranties and Representations of Genesis. In order to induce Power to
enter into the Agreement and to complete the transaction contemplated
hereby, Genesis warrants and represents to Power that:
A. Organization and Standing. Genesis is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Nevada, is qualified to do business as a foreign corporation in every
other state or jurisdiction in which it operates to the extent
required by the laws of such states and jurisdictions, and has full
power and authority to carry on its business as now conducted and to
own and operate its assets, properties and business. No changes
thereto will be made in any of the said documents before the Closing.
Lincoln is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware, is qualified to do
business as a foreign corporation in every other state or jurisdiction
in which it operates to the extent required by the laws of such states
and jurisdictions, and has full power and authority to carry on its
business as now conducted and to own and operate its assets,
properties and business. No changes thereto will be made in any of the
said documents before the Closing.
B. Capitalization. As of February 16, 2000, the Lincoln Shares constitute
one hundred
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percent (100%) of the equity capital of Lincoln, which includes, inter
alia, one hundred percent (100%) of Genesis's voting power, right to
receive dividends, when, as and if declared and paid, and the right to
receive the proceeds of liquidation attributable to its ownership of
the Lincoln shares, if any.
C. Ownership of the Lincoln Shares. As of the Date hereof, Genesis is the
sole owner of the Lincoln Shares, free and clear of all liens,
encumbrances and restrictions of any nature whatsoever, except by
reason of the fact that the Lincoln Shares will not have been
registered under the Securities Act of 1933 (the "33 Act"), or any
applicable State Securities laws.
D. Taxes. Genesis has filed or caused to be filed all federal, state and
local income or other tax returns and reports that it or Lincoln is
required to file with all governmental agencies, wherever situate, and
has paid or accrued for payment all taxes as shown on such returns,
such that a failure to file, pay or accrue will not have a material
adverse effect on Genesis or Lincoln.
E. Pending Actions. Except as may be disclosed in the Form 10SB filed by
Genesis October 26, 1999, a copy of which is attached as exhibit "A,"
there are no material legal actions, lawsuits, proceedings or
investigations, either administrative or judicial, pending or
threatened, against or affecting Genesis or Lincoln or that arise out
of the operation of those corporations. Neither Genesis nor Lincoln is
not in violation of any law, material ordinance or regulation of any
kind whatever, including, but not limited to laws, rules and
regulations governing the sale of its products, the 33 Act, the
Securities Exchange Act of 1934, as amended (the "34 Act") the Rules
and Regulations of the U.S. Securities and Exchange Commission
("SEC"), or the Securities Laws and Regulations of any state.
F. Governmental Regulation. Genesis and Lincoln hold the licenses and
registrations necessary to permit them to conduct their current
business. All of such licenses and registrations are in full force and
effect, and there are no proceedings, hearings or other actions
pending that may affect the validity or continuation of any of them.
No approval of any other trade or professional association or agency
of government is required for any of the transactions effected by this
Agreement, and the completion of the transactions contemplated by the
Agreement will not, in and of themselves, affect or jeopardize the
validity or continuation of any of them.
G. Ownership of Assets. Genesis has good, marketable title, without any
liens or encumbrances of any nature whatever, to all of the Lincoln
Shares. Lincoln has good, marketable title, without any liens or
encumbrances of any nature whatever, other than an ad velorem tax lien
in the approximate amount of $36,000 for property taxes, to one parcel
of real property containing approximately 10.9 acres, which is located
on Meadowbrook Drive in Fort Worth, Texas, Abstract 1133, tracts 1C,
1C1, 1K, 1L, and
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Lot 2B of Bullard Subdivision, Fort Worth, Texas. (Exhibit "B"
H. Corporate Records. All of Genesis's books and records, including,
without limitation, the books of account, corporate records, minute
book, stock certificate books and other records of Genesis, and all
books and records, including, without limitation, the books of
account, corporate records, minute book, stock certificate books and
other records of Lincoln, are up-to-date, complete and reflect
accurately and fairly the conduct of the business in all material
respects since the dates of incorporation of Genesis and Lincoln
respectively.
I. No Misleading Statements or Omissions. Neither the Agreement nor any
financial statement, exhibit, schedule or document attached hereto or
presented to Power in connection herewith, contains any materially
misleading statement, or omits any fact or statement necessary to make
the other statements or facts therein set forth not materially
misleading.
J. Validity of the Agreement. All corporate and other proceedings
required to be taken by Genesis in order to enter into and to carry
out the Agreement have been duly and properly taken. The Agreement has
been duly executed by Genesis, and constitutes the valid and binding
obligation of Genesis, except to the extent limited by applicable
bankruptcy, reorganization, insolvency, moratorium or other laws
relating to or affecting generally the enforcement of creditors
rights. The execution and delivery of the Agreement and the carrying
out of its purposes will not result in the breach of any of the terms
or conditions of, or constitute a default under or violate Genesis's
Certificate of Incorporation or document of undertaking, oral or
written, to which Genesis is a party or is bound or may be affected,
nor will such execution, delivery and carrying out violate any order,
writ, injunction, decree, law, rule or regulation of any court,
regulatory agency or other governmental body; and the business now
conducted by Genesis and/or Lincoln can continue to be so conducted
after completion of the transaction contemplated hereby.
K. Enforceability of the Agreement. When duly executed and delivered, the
Agreement and the Exhibits hereto which are incorporated herein and
made a part hereof are legal, valid, and enforceable by Power
according to their terms, except to the extent limited by applicable
bankruptcy, reorganization, insolvency, moratorium or other laws
relating to or affecting generally the enforcement of creditors rights
and that at the time of such execution and delivery, Power will have
acquired title in and to the Lincoln Shares free and clear of all
claims, liens and encumbrances.
L. Access to Books and Records. Power will have full and free access to
the books of Lincoln during the course of this transaction prior to
Closing, during regular business hours.
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M. Genesis's Financial Statements. Genesis's Balance Sheet and Profit and
Loss statement for the year ended September 30, 1999, are included in
the Form 10SB attached hereto as Exhibit "A", and accurately describe
Genesis's financial position as of the dates thereof.
N. Lincoln's Financial Statements. Lincoln's Balance Sheet and Profit and
Loss statement attached hereto as Exhibit "C", accurately describes
Lincoln's financial position as of the dates thereof.
IV. Warranties and Representations of Power. In order to induce Genesis to
enter into the Agreement and to complete the transaction contemplated
hereby, Power warrants and represents to Genesis that:
A. Organization and Standing. Power is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Nevada, is qualified to do business as a foreign corporation in every
other state in which it operates to the extent required by the laws of
such states, and has full power and authority to carry on its business
as now conducted and to own and operate its assets, properties and
business.
B. Capitalization Power's entire authorized equity capital consists of
shares of voting common stock, $.02 par value. As of the Closing,
Power will have 50,000,000 shares Common Stock, $.02 par value,
authorized, of which 9,581,140 shares of voting common stock of Power
will be issued and outstanding, which does not include the 600,000
shares being issued to Genesis hereunder pursuant to Section 4(2) of
the '33 Act, at closing. Upon issuance, all of the Power Common Stock
will be validly issued fully paid and non-assessable. The relative
rights and preferences of Power's equity securities are set forth in
the Articles of Incorporation, as amended and Power's By- Laws. Except
as set forth above, there are no voting or equity securities
convertible into voting stock, and no outstanding subscriptions,
warrants, calls, options, rights, commitments or agreements by which
Power is bound, calling for the issuance of any additional shares of
common stock or any other voting or equity security. The By- Laws of
Power provide that a simple majority of the shares voting at a
stockholders' meeting at which a quorum is present may elect all of
the directors of Power. Cumulative voting is not provided for by the
By-Laws or Articles of Incorporation of Power. Accordingly, as of the
Closing the 600,000 shares being issued to and acquired by Genesis
will constitute approximately 5.8% of the Common Shares of Power which
will then be issued and outstanding, which includes inter alia, that
same percentage of Power's voting power, right to receive dividends,
when, as and if declared and paid, and the right to receive the
proceeds of liquidation attributable to common stock, if any.
C. Ownership of Shares. By Power's issuance of the Power Shares to
Genesis pursuant to the Agreement, the Shareholders will thereby
acquire good absolute marketable
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title thereto, free and clear of all liens, encumbrances and
restrictions of any nature whatsoever, except by reason of the fact
that such Power shares will not have been registered under the '33
Act.
D. Taxes. Power has filed all federal, state and local income or
other tax returns and reports that it is required to file with
all governmental agencies, wherever situate. All of such returns
are true and complete.
E. No Pending Actions. Except as may be disclosed in the Form 10-KSB
filed by Power January 14, 2000, a copy of which is attached as
exhibit "D," There are no legal actions, lawsuits, proceedings or
investigations, either administrative or judicial, pending or
threatened, against or affecting Power, or against any of Power's
officers or directors and arising out of their operation of
Power. Power has been in compliance with, and has not received
notice of violation of any law, ordinance or regulation of any
kind whatever, including, but not limited to, the '33 Act, the
'34 Act, the Rules and Regulations of the SEC or the Securities
Laws and Regulations of any state. Power is not now and never has
been required to file reports under the '33 Act or the '34 Act.
F. Corporate Records. All of Power's books and records, including
without limitation, its book of account, corporate records,
minute book, stock certificate books and other records are
up-to-date, complete and reflect accurately and fairly the
conduct of its business in all respects since its date of
incorporation.
G. No Misleading Statements or Omissions. Neither the Agreement nor
any financial statement, exhibit, schedule or document attached
hereto or presented to Genesis in connection herewith contains
any materially misleading statement, or omits any fact or
statement necessary to make the other statements of facts therein
set forth not materially misleading.
H. Validity of the Agreement. All corporate action and proceedings
required to be taken by Power in order to enter into and to carry
out the Agreement have been duly and properly taken. The
Agreement has been duly executed by Power, and constitutes a
valid and binding obligation of Power. The execution and delivery
of the Agreement and the carrying out of its purposes will not
result in the breach of any of the terms or conditions of, or
constitute a default under or violate, Power's Certificate of
Incorporation or By- Laws, or any agreement, lease, mortgage,
bond, indenture, license or other document or undertaking, oral
or written, to which Power is a party or is bound or may be
affected, nor will such execution, delivery and carrying out
violate any order, writ, injunction, decree, law, rule or
regulation of any court regulatory agency or other governmental
body.
I. Enforceability of the Agreement. When duly executed and
delivered, the Agreement and the Exhibits hereto which are
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incorporated herein and made a part hereof are legal, valid, and
enforceable by Genesis according to their terms, and that at the
time of such execution and delivery, Genesis will have acquired
good, marketable title in and to the Power Common Shares acquired
pursuant hereto, free and clear of all liens and encumbrances.
J. Access to Books and Records. Genesis will have full and free
access to Power's books and records during the course of this
transaction prior to and at the Closing.
K. Power Financial Condition. The financial condition of Power is
set forth in the financial statements contained in Power's Form
10-KSB, attached hereto as Exhibit "D."
V. Term. All representations, warranties, covenants and agreements made herein
and in the exhibits attached hereto shall survive the execution and
delivery of the Agreement and payment pursuant thereto.
VI. The Power Shares. All of the Power Common Shares shall be validly issued,
fully-paid and non-assessable shares of Power Common Stock, with full
voting rights, dividend rights, and the right to receive the proceeds of
liquidation, if any, as set forth in the respective Articles of
Incorporation.
VII. Conditions Precedent to Closing.
A. The obligations of Genesis under the Agreement shall be and are
subject to fulfillment, prior to or at the Closing of each of the
following conditions:
1. That Power and its management representations and warranties
contained herein shall be true and correct at the time of
closing date as if such representations and warranties were
made at such time;
2. That Power and its management shall have performed or
complied with all agreements, terms and conditions required
by the Agreement to be performed or complied with by them
prior to or at the time of Closing;
3. That Power's stockholders, by proper and sufficient vote,
shall have properly approved all of the matters described in
Section VII(B)(1) herein, if required to do so under Nevada
Corporate Law; and
B. The obligations of Power under the Agreement shall be and are
subject to fulfillment, prior to, at the Closing or subsequent to
the Closing of each of the following conditions:
1. That Power stockholders, if necessary by proper and
sufficient
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vote of its stockholders, shall have approved the Agreement
and the transactions contemplated hereby and will have
approved such other changes as are consistent with the
Agreement for submission to Power stockholders, if required
to do so under Nevada Corporate Law;
2. That Genesis's representations and warranties contained
herein shall be true and correct at the time of Closing as
if such representations and warranties were made at such
time; and
3. That Genesis shall have performed or complied with all
agreements, terms and conditions required by the Agreement
to be performed or complied with by it prior to or at the
time of Closing.
4. That the parties jointly and severally indemnify and hold
harmless Power's former officers, directors, agents and
affiliates against any claims or liabilities, including
reasonable attorney's fees and other reasonable defense
costs incurred in defending such claims or liabilities,
resulting from any claims or liabilities asserted against
them as to any material misrepresentation or omissions in
the Agreement made by any party hereto.
VIII.Termination. The Agreement may be terminated at any time before or at
Closing, by:
A. The mutual agreement of the parties;
B. Any party if:
1. Any provision of the Agreement applicable to a party shall
be materially untrue or fail to be accomplished.
2. Any legal proceeding shall have been instituted or shall be
imminently threatening to delay, restrain or prevent the
consummation of the Agreement.
Upon termination of the Agreement for any reason, in accordance with the terms
and conditions set forth in this paragraph, each said party shall bear all costs
and expenses as each party has incurred and no party shall be liable to the
other.
IX. Exhibits. All Exhibits attached hereto are incorporated herein by this
reference as if they were set forth in entirety.
X. Miscellaneous Provisions. This Agreement is the entire agreement between
the parties in respect of the subject matter hereof, and there are no other
agreements, written or oral, nor may the Agreement be modified except in
writing and executed by all of the parties hereto. The failure to insist
upon strict compliance with any of the terms, covenants or conditions of
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the Agreement shall not be deemed a waiver or relinquishment of such right
or power at any other time or times.
XI. Closing. The Closing of the transactions contemplated by the Agreement
("Closing") shall take place at 1:00 P.M. on the first business day after
the stockholders of Power approve this transaction, if approval is required
or on February 9, 2000, whichever is sooner, if shareholder approval is not
required or can be obtained subsequent to closing by shareholder
ratification. The Closing shall occur at the offices of Genesis located at
268 West 400 South, Salt Lake City, Utah 84101 or such other date and place
as the parties hereto shall agree upon. At the Closing, all of the
documents and items referred to herein shall be exchanged.
XII. Effective Date. The effective date of this agreement shall be February 9,
2000.
XIII.Governing Law. The Agreement shall be governed by and construed in
accordance with the internal laws of the State of Nevada.
XIV. Counterparts. The Agreement may be executed in duplicate facsimile
counterparts, each of which shall be deemed an original and together shall
constitute one and the same binding Agreement, with one counterpart being
delivered to each party hereto.
IN WITNESS WHEREOF, the parties hereto have set their hands and seals
as of the date and year above first written.
Genesis Capital Corporation of Nevada
By:
--------------------------------------
Its: President
Power Exploration, Inc.
By: /s/ Joe Bill Bennett
--------------------------------------
Joe Bill Bennett
Its: President
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INDEX TO EXHIBITS
Exhibit No. Description
A Genesis's Form 10-SB.
B Deed of Texas property to Lincoln & Tax Notice.
C Lincoln's financial statements.
D Power's Form 10-KSB.
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