SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
June 29, 1999
One World Online.com, Inc.
(Formerly Medizone Canada Limited)
Nevada
(State or other jurisdiction of incorporation)
33-16757 87-0431771
(Commission file number) (IRS employer identification no.)
4778 North 300 West, Suite 200
Provo, UT 84604
(Address of principal executive offices) (Zip Code)
(801) 852-3540
(Registrants telephone number, including area code)
Medizone Canada Limited
55 West 200 North, Suite 2
Provo, UT 84601
(Former name and address of registrant)
<PAGE>
Item 1. Change in Control of Registrant.
The Registrant was originally organized under the laws of the State of
Utah on July 27, 1984, but changed its corporate domicile on August 4, 1998 to
the State of Nevada. The Registrant changed its name on June 29, 1999, to One
World Online.com, Inc. in connection with the acquisition of One World Online
Incorporated ("OWO") and I Ventures, Inc. ("IVI") (the "Acquisition").
The Company had 2,250,176 shares of Common Stock issued as of its year
ended December 31, 1998. However, effective April 26, 1999, the Company
effectuated a 4 for 1 forward split of the outstanding shares and a shareholder
contributed for cancellation certain shares resulting in the Company having
9,000,000 shares outstanding prior to the acquisition of OWO and IVI. The
Company completed, on June 29, 1999, the acquisition of OWO and IVI and issued
to the shareholders of OWO and IVI Corporation an aggregate of 12,725,000 share
of Common Stock. In connection with these acquisitions, certain shareholders
contributed 6,250,000 shares for cancellation. The Company now has 15,475,000
shares of Common Stock issued and outstanding as of the date hereof.
The Registrant proposes to become a nationwide provider of consumer
Internet access, electronic commerce (e-commerce) solutions for businesses, and
Internet training for businesses and individuals. The Registrant has also
established the One World Online Shopping Community, which includes a broad
range of retail products, educational information, 24-hour radio broadcasts,
news and entertainment. The Registrant's Internet access services will be
provided through a strategic network arrangement with PSINet Inc. (Nasdaq:PSIX),
whose nationwide Internet backbone has approximately 888 "Points of Presence"
(local telephone numbers through which subscribers can access the Internet) in
approximately 284 U.S. cities covering approximately 85% of the U.S. population.
The Registrant will market its products utilizing a direct marketing approach
through a network of Internet marketing consultants who are compensated based on
their personal sales volume, as well as the sales volume of their IMC network
and customers.
The Company is currently located in leased premises at 4778 North 300
West, Suite 200, Provo, Utah 84604, that contain approximately 7,400 square feet
of office space under a three year lease commencing July 1, 1999, with an option
to renew. The rent is $10,792 per month.
The Company has approximately sixty full time employees which it
expects to maintain for the near future.
At the closing of the acquisition of OWO and IVI the sole officer and
director of the registrant resigned and new management was appointed. The
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<PAGE>
following table sets forth the persons who serve as the directors and executive
officers of the Company and subsidiaries. Directors are elected for a period of
one year and thereafter serve until the next annual meeting at which their
successors are duly elected by the stockholders. Officers and other employees
serve at the will of the Board of Directors.
One World Online.com, Inc.
- - --------------------------
Name Age Position
Kelly M. Thayer 41 Chairman of the Board
Jeff Martin 52 Director
David N. Nemelka 34 Director, President and CEO
Paul D. Korth 35 Secretary/Treasurer
One World Online Incorporated
- - -----------------------------
Wayne Holbrook 44 Director, President
B. Ray Zoll 52 Director, Executive Vice
President, Corporate Counsel
David N. Nemelka 34 Director, Secretary/Treasurer
I Ventures, Inc.
- - ----------------
David N. Nemelka 34 Director
Jeff Martin 52 Director, President
Joseph M. Udall 34 Director, Secretary/Treasurer,
Corporate Counsel
Robert Wright 40 Chief Technical Officer
Brent Lee Metcalfe 39 Director Web Development
Lance King 42 Director of Application
Development
3
<PAGE>
Management Team
Kelly M. Thayer, Chairman of the Board, Secretary/Treasurer and
co-founder of OWO, he has eighteen year experience in managing, marketing and
consulting work involving public and privately-held businesses. He was founder
and CEO of Clear Image, Inc. (1980-1997) a marketing company with over 100
employees in offices in both Los Angeles and Utah. In his eighteen years with
Clear Image he worked with over 200 companies and produced over 700 films and
videos for companies such as Matol, Delta Airlines, Herbalife International and
Tupperware. In 1995 he began a partnership with the company Net Profit as one of
the first companies to market and develop web sites on the Internet.
David N. Nemelka, CEO, Director and co-founder brings six years of
marketing and finance experience with both private and public companies. He was
founder and President of McKinley Capital, a successful financial consulting
company from 1994 to the present. He worked in Brand Management for Proctor and
Gamble (1993-1994) where he developed the marketing plan for a budgeted $20
million new product launch. Mr. Nemelka received his B.S. in business finance
from Brigham Young University and his MBA from the Wharton Business School at
the University of Pennsylvania.
Jeff Martin, Director, President of IVI has a proven track record in
developing and growing businesses. For the past six years he has served on the
Board of Directors and as Purchasing Chairman for Corporate Express a $13
billion marketing and buying group. Prior to Corporate Express he served as
President of his own company which was voted one of the ten best in their
industry of over 17,000 businesses in 1990. His company was awarded the Small
Business of the Year Award for the West in 1987, 1988 and 1993. He has served on
the National Advisory Board Councils for companies such as 3M, McKesson
Champion, and Globe International.
Paul D. Korth, Secretary/Treasurer and Controller has significant
public and private accounting experience. From March, 1998 until May 1999, he
worked as a controller at Komatsu Equipment Company where he was responsible for
all areas of financial reporting. Prior to working at Komatsu, he worked in
public accounting with a variety of companies, both public and private. From
January 1997 until March 1998 he was a Senior Accountant at Deloitte & Touche,
LLP and managed all phases of audits. From September 1994 until December 1996 he
worked at Price Waterhouse LLP where he was rated first in his public accounting
class. Paul received his MBA, with an accounting emphasis, from Arizona State
University in May of 1994 where he was on the Dean's list, and his BS, Business
Management - Finance degree from Brigham Young University in August of 1989.
Wayne Holbrook, Director, and President of OWO, has ten years
experience in the network marketing industry both in the field and as an
executive in a public company. From 1996 to 1998 he served as executive vice
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<PAGE>
president of Global Connections where he managed the information systems,
customer service, marketing and fulfillment. While at Global Connections he
helped launch the Golf Connections concept and hew was instrumental in the
development of the corporate Internet strategy. From 1993-1995 he was a
distributor for Quorum International where he became thee top producer in Europe
with a sales organization of 47,000 distributors. From 1988 to 1993 he was a
distributor at National Safety Associates where he built a 35,000 person
organization and reached to highest level in the compensation structure within
seven months.
B. Ray Zoll, Director, Executive Vice President and Corporate Counsel
of OWO, has been a practicing attorney for the past twenty years focusing on
litigation, real estate and business law. In 1997 he co-founded and served as
Chairman of World Connections a successful Internet web development and
e-commerce company which was sold in 1999. He has also been involved in network
marketing since 1989 and has built a highly profitable network of over 15,000
distributors for NuSkin International.
Joseph M. Udall, Director, Secretary/Treasurer, Vice President and
Corporate Counsel of IVI brings significant experience working with technology
companies. He has been a practicing attorney for the past six years focusing on
corporate and software licensing law. From May 1998 to May 1999 he worked with
Udall, Zachreson & Smith specializing on general business law and software
licensing. From March 1995 to April 1998 he worked as Osborn Maledon, P.A. where
he was a partner representing various technology companies in the software and
Internet business. Prior to Osborn Maledon he was an associate at Meyer,
Hendricks, Victor, Osborn & Maledon, P.A. from September 1993 to April 1995. Mr.
Udall graduated Valedictorian, summa cum laude from the Arizona State University
College of Law in 1992 and B.A. magna cum laude in Economics from Brigham Young
University in 1989.
Robert Wright, Chief Technical Officer for IVI has been involved with
the Internet since its inception. His background in electronic publishing and
e-commerce include projects for companies such as Novell, Corel, Word Perfect,
Meckler Media and other Fortune 500 companies. He was the founding Director of
New Media Development for Word Perfect's publishing division and has been a
featured speaker at Internet World. He also worked at Novell including the
creation and development of dynamic database publishing tools. He is the
inventor of the IVY Binder, an electronic publishing and content management
tool.
Brent Lee Metcalfe, Director of Web Development for IVI bring a
powerful resume of technical achievement. During his seven years working for
Novell he developed the Web-based documentation user interface for key Novell
products, including NetWare, Z.E.N. words and Groupwise. Brent is the founder of
im@go w3 design, an Internet cousulting firm. His highly regarded technical
writings include: "Forms with Function" on onets builder.com, and "Advanced
JavaScript Windowing-PartOne: Self-Closing Popups" and "Advanced JavaScript
Windowing-Part Two: Kiosk Popups" on developer.com.
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<PAGE>
Upon the consummation of the Acquisition, the new Officers and
Directors of the Registrant as a group (3 persons) owned as a group 16.5% of the
voting securities of the Registrant not including any options.
As a result of the Acquisition the shareholders of OWO and IVI acquired
control of the Registrant. The source of consideration used by the shareholders
of OWO and IVI in the Acquisition of the Registrant were the shares of common
stock of OWO and IVI respectively owned or held beneficially prior to the
Acquisition that were acquired by the Registrant upon consummation of the
Acquisition in exchange for the same number of similar securities issued by the
Registrant.
The Registrant is not aware of any arrangements, the operation of which
may at a subsequent date result in a change in control of the Registrant.
Item 2. Acquisition or Disposition of Assets.
See Item 1, above.
Item 4. Changes in Registrant's Certifying Accountant.
In connection with the acquisition of OWO and IVI described herein, the
new Board of Directors made the decision to continue the services of the
auditors for OWO and IVI as the auditors for the Registrant because they were
familiar with the business of the companies acquired and therefore on July 12,
1999, the final decision was made to dismiss the Registrant's prior auditors.
No accountant's report on the Registrant's financial statements for the
past two years has contained an adverse opinion or disclaimer of opinion or has
been qualified or modified as to uncertainty, audit scope, accounting principles
other than a qualification as to the Registrant's ability to continue as a
"going concern".
During the Registrant's two most recent fiscal years and any subsequent
interim period preceding this dismissal there were no disagreements with the
former accountant on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which disagreement(s), if
not resolved to the satisfaction of the former accountant, would have caused it
to make a reference to the subject matter of the disagreement(s) in connection
with its report.
Tanner & Co. of Salt Lake City, Utah was appointed as the Registrant's
auditor on July 12, 1999. The Registrant did not consult its prior accountant or
new accountant regarding the accounting issues described in Rule 304(a)(2) of
Regulation S-K.
6
<PAGE>
Item 5. Other Events.
In connection with certain corporate actions approved by the
Registrant's board of directors and by written consent of shareholders owning in
excess of a majority of the Company's outstanding Common Stock, the following
matters were accomplished on or about June 29, 1999:
(a) The acquisition of all the outstanding capital stock of
One World Online, Incorporated, ("OWO") and I Ventures, Inc. ("IVI"),
following which those two corporations became wholly-owned subsidiaries
of the Company (the "Acquisition"). In connection with the Acquisition,
at the closing thereof (the "Closing" or "Closing Date"), the Company
accepted from certain existing shareholders 6,250,000 shares of common
stock for cancellation and issued to the shareholders of OWO and IVI,
an aggregate of 12,725,000 restricted shares of common stock so that
the Company has 15,475,000 shares of common stock outstanding;
(b) An amendment to the Company's articles of incorporation to
(1) change its name to One World Online.com, Inc., (2) authorize
1,000,000 shares of blank check preferred stock, and (3) add a
provision eliminating liability of officers and directors to
shareholders for breach of fiduciary duty under Nevada law;
(c) The resignation of Brenda Hall as the sole officer and
director of the Company along with the election of the following
nominees to serve as the directors of the Company subsequent to the
Acquisition: Kelly M. Thayer, Jeff Martin and David N. Nemelka; and
(d)The adoption of a 1999 Stock Option Plan covering 4,000,000
shares.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired.
The Registrant has determined to file reports as a small business
issuer as defined in Regulation S-B for its 1997, 1998, and 1999 fiscal years
and accordingly will comply with the financial statement requirements of Item
310 of Regulation S-B. Required financial statements of OWO and IVI, under
Regulation S-B are attached hereto.
(b) Pro Forma Financial Information.
Pro forma financial information is attached hereto.
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<PAGE>
(c) Exhibits.
2.1 Agreement and Plan of Reorganization dated as of June
29, 1999, among Registrant, Medizone Canada Limited,
a certain shareholder of Registrant and One World
Online Incorporated.
2.2 Agreement and Plan of Reorganization dated as of June
29, 1999, among Registrant, Medizone Canada Limited,
a certain shareholder of Registrant and I Ventures,
Inc.
3(i).1 Amended Articles of Incorporation of Registrant.
Item 8. Change in Fiscal Year.
On June 29, 1999, the Registrant made the decision to change its fiscal
year end from December 31st to June 30th, effective immediately. The Registrant
will file a Form 10-KSB covering the transition period ending June 30, 1999.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
One World Online.com, Inc.
/s/ David N. Nemlka
-------------------------------
David N. Nemlka, President
Date: July 13, 1999.
T83(a)form8-k.owo
8
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Financial Statements
December 31, 1998
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Index to Financial Statements
- - --------------------------------------------------------------------------------
Page
Independent Auditors' Report F-2
Balance sheet F-3
Statement of operations F-4
Statement of stockholders' equity F-5
Statement of cash flows F-6
Notes to financial statements F-7
- - --------------------------------------------------------------------------------
F-1
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
and Stockholders of
One World Online Incorporated
We have audited the accompanying balance sheet of One World Online
Incorporated(a development stage company), as of December 31, 1998 and the
related statements of operations, stockholders' equity and cash flows for the
period November 12, 1998 (date of inception) to December 31, 1998. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of One World Online Incorporated,
as of December 31, 1998 and the results of its operations and its cash flows for
the period November 12, 1998 (date of inception) to December 31, 1998, in
conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company has a deficit in working capital, incurred a
loss and has not generated any revenues. These conditions raise substantial
doubt about its ability to continue as a going concern. Management's plans
regarding those matters also are described in Note 2. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.
TANNER + Co.
Salt Lake City, Utah
May 7, 1999
F-2
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Balance Sheet
December 31, 1998
- - --------------------------------------------------------------------------------
Assets
------
Current assets:
Cash $ 80,255
Stock subscription receivable 171,500
Prepaid expenses 3,000
-------------------
Total current assets 254,755
Investment 495,000
Equipment, net 31,431
Other assets 3,149
-------------------
Total assets $ 784,335
-------------------
- - --------------------------------------------------------------------------------
Liabilities and Stockholders' Equity
------------------------------------
Current liabilities:
Accounts payable $ 2,530
Accrued liabilities 37,747
Related party note payable 19,000
Stock subscription payable 425,000
Current portion of capital lease obligation 5,071
-------------------
Total current liabilities 489,348
-------------------
Capital lease obligation 12,419
-------------------
Commitments -
Stockholders' equity:
Common stock, $.001 par value 50,000,000 shares
authorized, 386,500 shares issued and outstanding 387
Additional paid in capital 386,113
Accumulated deficit (103,932)
-------------------
Total stockholders' equity 282,568
-------------------
Total liabilities and stockholders' equity $ 784,335
-------------------
- - --------------------------------------------------------------------------------
See accompanying notes to financial statements. F-3
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Statement of Operations
November 12, 1998 (Date of Inception) to December 31, 1998
- - --------------------------------------------------------------------------------
Revenue $ -
General and administrative expenses (98,932)
Equity in loss of unconsolidated subsidiary (5,000)
-------------------
Loss before income taxes (103,932)
Income tax benefit -
-------------------
Net loss $ (103,932)
-------------------
Loss per share - basic and diluted $ (2.60)
-------------------
Weighted average shares - basic and diluted 40,000
-------------------
- - --------------------------------------------------------------------------------
See accompanying notes to financial statements. F-4
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Statement of Stockholders' Equity
November 12, 1998 (Date of Inception) to December 31, 1998
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Common Stock Additional
------------------------- Paid-In Accumulated
Shares Amount Capital Deficit
------------------------------------------------------------
<S> <C> <C> <C> <C>
Balance at November 12, 1998 - $ - $ - $ -
Issuance of common stock for:
Cash 215,000 215 214,785 -
Subscription receivable 171,500 172 171,328 -
Net loss - - - (103,932)
------------------------------------------------------------
Balance at December 31, 1998 386,500 $ 387 $ 386,113 $ (103,932)
------------------------------------------------------------
- - ----------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements. F-5
</TABLE>
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Statement of Cash Flows
November 12, 1998 (Date of Inception) to December 31, 1998
- - --------------------------------------------------------------------------------
Cash flows from operating activities:
Net loss $ (103,932)
Adjustments to reconcile net loss to
net cash used in operating activities:
Equity in loss of unconsolidated subsidiary 5,000
Depreciation 789
Increase in:
Prepaid expenses (3,000)
Other assets (3,149)
Increase in:
Accounts payable 2,530
Accrued liabilities 37,747
---------------
Net cash used in
operating activities (64,015)
---------------
Cash flows from investing activities:
Purchase of equipment (14,730)
Investment in affiliate (75,000)
---------------
Net cash used in
Investing activities (89,730)
---------------
Cash flows from financing activities:
Increase in related party payable 19,000
Issuance of common stock 215,000
---------------
Net cash provided by
financing activities 234,000
---------------
Net increase in cash 80,255
Cash, beginning of period -
---------------
Cash, end of period $ 80,255
---------------
- - --------------------------------------------------------------------------------
See accompanying notes to financial statements. F-6
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
December 31, 1998
- - --------------------------------------------------------------------------------
1. Organization and Summary of Significant Accounting Policies
Organization
One World Online Incorporated (the Company) was incorporated in the State of
Utah on November 12, 1998 for the purpose of, but not limited to, developing and
marketing various Internet and Internet-related products and services.
In accordance with SFAS No. 7, the Company is considered to be in the
developmental stage. The Company is devoting substantially all of its efforts to
establishing a new business. No principal operations have commenced and no
significant revenues have been derived from operations.
Concentration of Credit Risk
The Company maintains its cash in bank deposit accounts which, at times, may
exceed federally insured limits. The Company has not experienced any losses in
such accounts and believes it is not exposed to any significant credit risk on
cash and cash equivalents.
Cash and Cash Equivalents
For purposes of the statement of cash flows, cash includes all cash and
investments with original maturities to the Company of three months or less.
Investment
The Company owns an investment in I-Ventures, Inc. which also provides services
to the Company. Since the Company exercises significant control, the investment
is accounted for using the equity method.
Equipment
Equipment is recorded at cost less accumulated depreciation. Depreciation is
provided using the straight-line method over the estimated useful lives.
Income Taxes
Deferred income taxes are provided in amounts sufficient to give effect to
temporary differences between financial and tax reporting.
Loss Per Share
The computation of basic earnings per common share is based on the weighted
average number of shares outstanding during the period.
- - --------------------------------------------------------------------------------
F-7
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
Continued
- - --------------------------------------------------------------------------------
1. Organization and Summary of Significant Accounting Policies Continued
Loss Per Share - Continued
The computation of diluted earning per common share is based on the weighted
average number of shares outstanding during the period plus the common stock
equivalents which would arise from the exercise of stock options and warrants
outstanding using the treasury stock method and the average market price per
share during the period. Common stock equivalents are not included in the
diluted earnings per share calculation when their effect is antidilutive.
Use of Estimates in Financial Statements
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements.
Actual results could differ from those estimates.
2. Going Concern
The accompanying financial statements of One World Online Incorporated, have
been prepared on a going-concern basis, which contemplates profitable operations
and the satisfaction of liabilities in the normal course of business. There are
uncertainties that raise substantial doubt about the ability of the Company to
continue as a going concern. As shown in the statement of operations, the
Company has had no revenues from operations and reported a net loss of $103,932
for the period ended December 31, 1998.
The Company's continuation as a going concern is dependent upon its ability to
satisfactorily meet its debt obligations, secure adequate new financing and
generate sufficient cash flows from operations to meet its obligations. The
financial statements do not include any adjustments that might result from the
outcome of these uncertainties.
Management has entered into a plan where it is pursuing other financing and
searching for additional business opportunities. It is not known if the Company
will be successful.
- - --------------------------------------------------------------------------------
F-8
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
Continued
- - --------------------------------------------------------------------------------
3. Equipment
Equipment consists of the following:
Computers and fixtures $ 22,690
Office furniture and fixtures 9,530
------------------
32,220
Less accumulated depreciation and amortization (789)
------------------
$ 31,431
------------------
4. Related Party Notes Payable
The Company has an unsecured note payable due to a shareholder totaling $19,000.
The note has a stated interest rate of 10% and is due on demand.
5. Stock Subscription Payable
The Company has entered into a subscription agreement to purchase additional
shares of I-Ventures, Inc. for $425,000 which was paid prior to May 7, 1999.
6. Capital Lease Obligation
The Company leases certain computers and equipment under a noncancellable
capital lease. The terms of the lease include an option to purchase the
equipment at the end of the lease and an imputed interest rate of 16.5%. The
computers and equipment held under the capital lease has a cost of $17,490 and
accumulated depreciation of $486 at December 31, 1998.
- - --------------------------------------------------------------------------------
F-9
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
Continued
- - --------------------------------------------------------------------------------
6. Capital Lease Obligation Continued
Amortization expense for the year ended December 31, 1998 was $486.
Future minimum lease payments as of December 31, 1998 are as follows:
Year Ending Amount
------------------
1999 $ 7,332
2000 7,332
2001 7,332
------------------
21,996
Less amount representing interest (4,506)
------------------
Present value of future minimum lease payments $ 17,490
------------------
Future maturities of the capital lease obligation is as follows:
Year Ending Amount
------------------
1999 $ 5,071
2000 5,702
2001 6,717
------------------
$ 17,490
------------------
7. Income Taxes
The benefit for income taxes is different from amounts which would be provided
by applying the statutory federal income tax rate to loss before benefit for
income taxes for the following reasons:
Federal income tax benefit at statutory rate $ 36,000
Change in valuation allowance (36,000)
------------------
$ -
------------------
- - --------------------------------------------------------------------------------
F-10
<PAGE>
ONE WORLD ONLINE INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
Continued
- - --------------------------------------------------------------------------------
7. Income Taxes Continued
Deferred tax assets (liabilities) consist of the following:
Net operating loss carryforward $ 36,000
Valuation allowance (36,000)
------------------
$ -
------------------
At December 31, 1998, the Company has a net operating loss carryforward
available to offset future taxable income of approximately $103,000, which will
begin to expire in 2019. The utilization of the net operating loss carryforward
is dependent upon the tax laws in effect at the time the net operating loss
carryforwards can be utilized. The Tax Reform Act of 1986 significantly limits
the annual amount that can be utilized for certain of these carryforward as a
result of the change in ownership.
8. Supplemental Cash Flow Disclosure
There were no amounts paid for interest or income taxes for the period November
12, 1998 (date of inception) to December 31, 1998.
During the period ended December 31, 1998:
o The Company acquired equipment in exchange for a capital lease of $17,490.
o The Company acquired 425,000 shares of I-Ventures, Inc. in exchange for a
stock subscription payable.
o The Company issued 171,500 shares of common stock in exchange for a stock
subscription receivable which was paid prior to May 7, 1999.
9. Related Party Transactions
During the period ended December 31, 1998, the Company acquired certain
equipment from a related party totaling $11,000.
- - --------------------------------------------------------------------------------
F-11
<PAGE>
I VENTURES, INC.
(A Development Stage Company)
Financial Statements
December 31, 1998 and 1997
I VENTURES, INC.
(A Development Stage Company)
Index to Financial Statements
- - --------------------------------------------------------------------------------
Page
Independent Auditors' Report F-2
Balance sheet F-3
Statement of operations F-4
Statement of stockholders' equity F-5
Statement of cash flows F-6
Notes to financial statements F-7
F-1
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
and Stockholders of
I Ventures, Inc.
We have audited the accompanying balance sheet of I Ventures, Inc.(a development
stage company), as of December 31, 1998 and 1997 and the related statements of
operations, stockholders' equity and cash flows for the years ended December 31,
1998 and 1997 and the cumulative amounts since inception. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of I Ventures, Inc., as of
December 31, 1998 and 1997 and the results of its operations and its cash flows
for the years ended December 31, 1998 and 1997 and the cumulative amounts since
inception, in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company has a deficit in working capital, incurred a
loss and has not generated any revenues. These conditions raise substantial
doubt about its ability to continue as a going concern. Management's plans
regarding those matters also are described in Note 2. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.
TANNER + Co.
Salt Lake City, Utah
June 23, 1999
F-2
<PAGE>
<TABLE>
<CAPTION>
I VENTURES, INC.
(A Development Stage Company)
Balance Sheet
December 31,
- - ----------------------------------------------------------------------------------------------------------
Assets 1998 1997
-----------------------------------
Current assets:
<S> <C> <C>
Cash $ 5,808 $ 883
Stock subscription receivable 425,000 -
-----------------------------------
Total current assets 430,808 883
Property and equipment, net 88,835 -
-----------------------------------
Total assets $ 519,643 $ 883
-----------------------------------
- - ----------------------------------------------------------------------------------------------------------
Liabilities and Stockholders' Equity
Current liabilities:
Accrued liabilities $ 9,812 $ -
Related party payables 82,743 -
-----------------------------------
Total current liabilities 92,555 -
-----------------------------------
Commitments - -
Stockholders' equity:
Common stock, $.001 par value 50,000,000 shares
authorized, 8,525,000 and 1,000,000 shares issued
and outstanding, respectively 8,525 1,000
Additional paid in capital 510,038 -
Accumulated deficit (91,475) (117)
-----------------------------------
Total stockholders' equity 427,088 883
-----------------------------------
Total liabilities and stockholders' equity $ 519,643 $ 883
-----------------------------------
- - ----------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
F-3
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
I VENTURES, INC.
(A Development Stage Company)
Statement of Operations
Years Ended December 31, and Cumulative Amounts
- - ----------------------------------------------------------------------------------------------------------
Cumulative
1998 1997 Amounts
-----------------------------------------------------
<S> <C> <C> <C>
Revenue $ $ - $ -
General and administrative expenses (91,358) (117) (91,475)
-----------------------------------------------------
Loss before income taxes (91,358) (117) (91,475)
Income tax benefit - - -
-----------------------------------------------------
Net loss $ (91,358) $ (117) $ (91,475)
-----------------------------------------------------
Loss per share - basic and diluted $ (.06) $ (.00) $ (.07)
-----------------------------------------------------
Weighted average shares - basic and diluted 1,636,000 1,000,000 1,318,000
-----------------------------------------------------
- - ----------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
F-4
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
I VENTURES, INC.
(A Development Stage Company)
Statement of Stockholders' Equity
December 30, 1996 (Date of Inception) to December 31, 1998
- - ----------------------------------------------------------------------------------------------------------
Additional
Common Stock Paid-In Accumulated
----------------------------
Shares Amount Capital Deficit Total
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balance at December 30, 1996 - $ - $ - $ - $ - -
Issuance of common stock for cash 1,000,000 1,000 - - 1,000
----------------------------------------------------------------------
Balance December 31, 1996 1,000,000 1,000 - - 1,000
Net loss - - - (117) (117)
----------------------------------------------------------------------
Balance at December 31, 1997 1,000,000 1,000 - (117) 883
Issuance of common stock for:
Cash 7,000,000 7,000 10,500 - 17,500
Subscription receivable 500,000 500 499,500 - 500,000
Property and equipment 25,000 25 38 - 63
Net loss - - - (91,358) (91,358)
----------------------------------------------------------------------
Balance at December 31, 1998 8,525,000 $ 8,525 $ 510,038 $ (91,475) $ 427,088
----------------------------------------------------------------------
- - ----------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
F-5
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
I VENTURES, INC.
(A Development Stage Company)
Statement of Cash Flows
Years Ended December 31, and Cumulative Amounts
- - ----------------------------------------------------------------------------------------------------------
Cumulative
1998 1997 Amounts
-----------------------------------------------------
Cash flows from operating activities:
<S> <C> <C> <C>
Net loss $ (91,358) $ (117) $ (91,475)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation 1,349 - 1,349
Increase in accrued liabilities 9,812 - 9,812
-----------------------------------------------------
Net cash used in
operating activities (80,197) (117) (80,314)
-----------------------------------------------------
Cash flows from investing activities-
purchase of property and equipment (27,378) - (27,378)
-----------------------------------------------------
Cash flows from financing activities:
Proceeds from issuance of common stock 92,500 1,000 93,500
Increase in related party payables 20,000 - 20,000
-----------------------------------------------------
Net cash provided by
financing activities 112,500 1,000 113,500
-----------------------------------------------------
Net increase in cash 4,925 883 5,808
Cash, beginning of period 883 - -
-----------------------------------------------------
Cash, end of period $ 5,808 $ 883 $ 5,808
-----------------------------------------------------
- - ----------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
F-6
</TABLE>
<PAGE>
I VENTURES, INC.
(A Development Stage Company)
Notes to Financial Statements
December 31, 1998 and 1997
- - --------------------------------------------------------------------------------
1. Organization and Summary of Significant Accounting Policies
Organization
I Ventures, Inc. (the Company) was incorporated in the State of Colorado on June
14, 1996 for the purpose of, but not limited to, developing and marketing
various Internet and Internet-related products and services.
From June 14, 1996 until December 30, 1996 (date of inception) I Ventures, Inc.
was an inactive company. On December 30, 1996, I Ventures became a development
stage enterprise as defined in Statement of Financial Accounting Standards No.
7, "Auditing and Reporting by Development Stage Enterprises."
In accordance with SFAS No. 7, the Company is considered to be in the
developmental stage. The Company is devoting substantially all of its efforts to
establishing a new business. No principal operations have commenced and no
significant revenues have been derived from operations.
Concentration of Credit Risk
The Company maintains its cash in bank deposit accounts which, at times, may
exceed federally insured limits. The Company has not experienced any losses in
such accounts and believes it is not exposed to any significant credit risk on
cash and cash equivalents.
Cash and Cash Equivalents
For purposes of the statement of cash flows, cash includes all cash and
investments with original maturities to the Company of three months or less.
Property and Equipment
Equipment is recorded at cost less accumulated depreciation. Depreciation is
provided using the straight-line method over the estimated useful lives.
Income Taxes
Deferred income taxes are provided in amounts sufficient to give effect to
temporary differences between financial and tax reporting.
Loss Per Share
The computation of basic earnings per common share is based on the weighted
average number of shares outstanding during the period.
- - --------------------------------------------------------------------------------
F-7
<PAGE>
I VENTURES, INC.
(A Development Stage Company)
Notes to Financial Statements
Continued
- - --------------------------------------------------------------------------------
1. Organization and Summary of Significant Accounting Policies
Continued
Loss Per Share - Continued
The computation of diluted earnings per common share is based on the weighted
average number of shares outstanding during the period plus the common stock
equivalents which would arise from the exercise of stock options and warrants
outstanding using the treasury stock method and the average market price per
share during the period. Common stock equivalents are not included in the
diluted earnings per share calculation when their effect is antidilutive.
Use of Estimates in Financial Statements
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements.
Actual results could differ from those estimates.
2. Going Concern
The accompanying financial statements of I Ventures, Inc., have been prepared on
a going-concern basis, which contemplates profitable operations and the
satisfaction of liabilities in the normal course of business. There are
uncertainties that raise substantial doubt about the ability of the Company to
continue as a going concern. As shown in the statement of operations, the
Company has had no revenues from operations and reported a net loss of $91,358
for the year ended December 31, 1998.
The Company's continuation as a going concern is dependent upon its ability to
satisfactorily meet its debt obligations, secure adequate new financing and
generate sufficient cash flows from operations to meet its obligations. The
financial statements do not include any adjustments that might result from the
outcome of these uncertainties.
Management has entered into a plan where it is pursuing other financing and
searching for additional business opportunities. It is not known if the Company
will be successful.
- - --------------------------------------------------------------------------------
F-8
<PAGE>
I VENTURES, INC.
(A Development Stage Company)
Notes to Financial Statements
Continued
- - --------------------------------------------------------------------------------
3. Property and Equipment
Property and equipment consists of the following:
Computers and fixtures $ 85,895
Office furniture and fixtures 4,289
-----------------
90,184
Less accumulated depreciation and amortization (1,349)
-----------------
$ 88,835
-----------------
4. Related Party Payables
The Company has unsecured notes to an officer/shareholder of the Company. The
notes bear interest at 15%, are due on demand and had aggregate outstanding
balances of $20,000 at December 31, 1998.
The Company has an unsecured, non-interest bearing note payable to an
employee/shareholder of $62,743 as of December 31, 1998 which is due on demand.
5. Stock Subscription Receivable
During the year ended December 31, 1998, the Company entered into a stock
subscription agreement with One World Online, Incorporated for 500,000 shares of
the Company's common stock for $500,000. Subsequent to the year ended December
31, 1998 the remaining balance of $425,00 was collected.
- - --------------------------------------------------------------------------------
F-9
<PAGE>
I VENTURES, INC.
(A Development Stage Company)
Notes to Financial Statements
Continued
- - --------------------------------------------------------------------------------
6. Income Taxes
The benefit for income taxes is different from amounts which would be provided
by applying the statutory federal income tax rate to loss before benefit for
income taxes for the following reasons:
Years Ended
December 31, Cumulative
-------------------------------
1998 1997 Amounts
----------------------------------------------
Federal income tax
benefit at statutory rate $ 16,000 $ - $ 31,000
Change in valuation
allowance (16,000) - (31,000)
----------------------------------------------
$ - $ - $ -
----------------------------------------------
Deferred tax assets (liabilities) consist of the following:
December 31,
-----------------------------------
1998 1997
-----------------------------------
Net operating loss carryforward $ 31,000 $ -
Valuation allowance (31,000) -
-----------------------------------
$ - $ -
-----------------------------------
At December 31, 1998, the Company has a net operating loss carryforward
available to offset future taxable income of approximately $91,000, which will
begin to expire in 2019. The utilization of the net operating loss carryforward
is dependent upon the tax laws in effect at the time the net operating loss
carryforwards can be utilized. The Tax Reform Act of 1986 significantly limits
the annual amount that can be utilized for certain of these carryforward as a
result of the change in ownership.
- - --------------------------------------------------------------------------------
F-10
<PAGE>
I VENTURES, INC.
(A Development Stage Company)
Notes to Financial Statements
Continued
- - --------------------------------------------------------------------------------
7. Supplemental Cash Flow Disclosure
There were no amounts paid for interest or income taxes for the years ended
December 31, 1998 and 1997 or from the date of inception.
During the year ended December 31, 1998:
* The Company issued 500,000 shares of common stock in exchange
for a stock subscription receivable in the amount of $500,000; the
stock subscription receivable was paid subsequent to year ended
December 31, 1998.
* The Company purchased property and equipment in exchange for
25,000 shares of common stock and a note payable for $62,743.
8. Fair Value of Financial Instruments
None of the Company's debt instruments are held for trading purposes. The
Company estimates that the fair value of all financial instruments at December
31, 1998, does not differ materially from the aggregate carrying values of its
financial instruments recorded in the accompanying balance sheet. The estimated
fair value amounts have been determined by the Company using available market
information and appropriate valuation methodologies. Considerable judgement is
necessarily required in the interpreting market data to develop the estimates of
fair value, and, accordingly, the estimates are not necessarily indicative of
the amounts that the Company could realize in a current market exchange.
9. Stock Options
Information regarding stock options is summarized below:
Number of Option Price
Options Per Share
-----------------------------------
Outstanding at December 31, 1996
and 1997 - $ -
Granted 1,275,000 1.00
-----------------------------------
Outstanding at December 31, 1998 1,275,000 $ 1.00
-----------------------------------
No options are exercisable at December 31, 1998.
- - --------------------------------------------------------------------------------
F-11
<PAGE>
I VENTURES, INC.
(A Development Stage Company)
Notes to Financial Statements
Continued
- - --------------------------------------------------------------------------------
10. Stock-Based Compensation
The Company has adopted the disclosure only provisions of Statement of Financial
Accounting Standards (SFAS) No. 123, Accounting for Stock-Based Compensation.
Accordingly, no compensation cost has been recognized in the financial
statements. Had compensation cost for the Company's stock options been
determined based on the fair value at the grant date for awards in 1998,
consistent with the provisions of SFAS no. 123 the Company's earnings and
earnings per share would not have changed.
The fair value of each option grant is estimated on the date of grant using the
Black-Scholes option pricing model with the following assumptions:
December 31,
-----------------
1998
-----------------
Expected dividend yield $ -
Expected stock price volatility -
Risk-free interest rate 5%
Expected life of options 10 years
-----------------
The weighted average fair value of options granted during 1998 is $.39.
The following table summarizes information about stock options outstanding at
December 31, 1998:
Options Outstanding Options Exercisable
------------------------------------------------------------------
Weighted
Average
Number Remaining Weighted Number Weighted
Range of Outstanding Contractual Average Exercisable Average
Exercise at Life Exercise at Exercise
Prices 12/31/98 (Years) Price 12/31/98 Price
- - --------------------------------------------------------------------------------
$ 1.00 1,275,000 9.9 $ 1.00 - $ -
- - --------------------------------------------------------------------------------
F-12
<PAGE>
<TABLE>
<CAPTION>
ONE WORLD ONLINE.COM, INC.
(A Development Stage Company)
Unaudited Proforma Consolidated Balance Sheet
March 31, 1999
- - ---------------------------------------------------------------------------------------------------------------------------------
Assets One World Medizone
Online I-Ventures Canada
Current assets:
<S> <C> <C> <C>
Cash $ 2,701,018 $ 327,860 $ 16,323
Accounts receivable 40,198 26,849 857
Other current assets 5,900 4,200 -
------------------------------------------------------------
Total current assets 2,747,116 358,909 17,180
Investment 495,000 - -
Equipment, net 60,496 180,743 -
Other assets 18,265 800 -
------------------------------------------------------------
Total assets $ 3,320,877 $ 540,452 $ 17,180
------------------------------------------------------------
- - ---------------------------------------------------------------------------------------------------------------------------------
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 27,333 $ - $ 438
Accrued liabilities 71,560 34,076 -
Current portion of capital lease obligations 3,124 - -
Related party notes payable 19,000 - -
------------------------------------------------------------
Total current liabilities 121,017 34,076 438
------------------------------------------------------------
Capital lease obligations 12,419 - -
------------------------------------------------------------
Stockholders' equity
Common stock 9,500 3,225 2,750
Additional paid in capital 3,446,000 842,838 260,593
Accumulated deficit (268,059) (339,687) (246,601)
------------------------------------------------------------
Total stockholders' equity 3,187,441 506,376 16,742
------------------------------------------------------------
Total liabilities and stockholders' equity $ 3,320,877 $ 540,452 $ 17,180
------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
ONE WORLD ONLINE.COM, INC.
(A Development Stage Company)
Unaudited Proforma Consolidated Balance Sheet
(continued)
March 31, 1999
- - ---------------------------------------------------------------------------------------------------------------------------------
Assets Post-merger
Combined Adjustments As Adjusted
Current assets:
<S> <C> <C> <C>
Cash $ 3,045,201 $ - $ 3,045,201
Accounts receivable 67,904 (26,849) (A) 41,055
Other current assets 10,100 - 10,100
-----------------------------------------------------------------
Total current assets 3,123,205 3,096,356
Investment 495,000 (495,000) (B) -
Equipment, net 241,239 - 241,239
Other assets 19,065 - 19,065
-----------------------------------------------------------------
Total assets $ 3,878,509 $ (521,849) $ 3,356,660
-----------------------------------------------------------------
- - --------------------------------------------------------------------------------------------------------------------------------
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 27,771 $ (26,849) (A) $ 922
Accrued liabilities 105,636 - 105,636
Current portion of capital lease obligations 3,124 - 3,124
Related party notes payable 19,000 - 19,000
-----------------------------------------------------------------
Total current liabilities 155,531 128,682
-----------------------------------------------------------------
Capital lease obligations 12,419 12,419
-----------------------------------------------------------------
Stockholders' equity
Common stock 15,475 15,475
Additional paid in capital 4,549,431 (737,884) (B) 3,811,547
Accumulated deficit (854,347) 242,884 (B) (611,463)
-----------------------------------------------------------------
Total stockholders' equity 3,710,559 3,215,559
-----------------------------------------------------------------
Total liabilities and
stockholders' equity $ 3,878,509 $ (521,849) $ 3,356,660
-----------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ONE WORLD ONLINE.COM, INC.
(A Development Stage Company)
Unaudited Proforma Consolidated Statement of Operations
Janaury 1, 1999 to March 31, 1999
- - --------------------------------------------------------------------------------------------------------
One World Medizone
Online I-Ventures Canada
<S> <C> <C> <C>
Revenue $ 138,613 $ 36,162 $ -
Cost of sales 62,489 142,879 -
--------------------------------------------------
Gross margin 76,124 (106,717) -
General and administrative expenses 240,251 141,495 3,717
--------------------------------------------------
Loss before income taxes (164,127) (248,212) (3,717)
Income tax benefit - - -
--------------------------------------------------
Net loss $ (164,127) $ (248,212) $ (3,717)
--------------------------------------------------
Loss per share - basic and diluted $ (0.07) $ (0.03) $ (0.00)
--------------------------------------------------
Weighted Average Shares - basic and diluted 2,228,000 8,852,000 2,250,000
--------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
ONE WORLD ONLINE.COM, INC.
(A Development Stage Company)
Unaudited Proforma Consolidated Statement of Operations
(continued)
Janaury 1, 1999 to March 31, 1999
- - --------------------------------------------------------------------------------------------------------------------
Post-merger
Combined Adjustments As Adjusted
<S> <C> <C> <C>
Revenue $ 174,775 $ (31,618) (C) $ 143,157
Cost of sales 205,368 (31,618) (C) 173,750
-------------------------------------------------------------
Gross margin (30,593) - (30,593)
General and administrative expenses 385,463 - 385,463
-------------------------------------------------------------
Loss before income taxes (416,056) - (416,056)
Income tax benefit - -
-------------------------------------------------------------
Net loss $ (416,056) $ - $ (416,056)
-------------------------------------------------------------
Loss per share - basic and diluted $ (0.03)
--------------------
Weighted Average Shares - basic and diluted 15,475,000
--------------------
</TABLE>
ONE WORLD ONLINE.COM, INC
NOTES TO UNAUDITED PROFORMA CONSOLIDATED FINANCIAL STATEMENTS
(A) Represents an I-Ventures, Inc. receivable and a One World Online,
Incorporated payable for related party sales and services.
(B) Represents the One World Online, Incorporated and I-Ventures, Inc.
reverse acquisition.
(C) Represents revenues and cost of sales on related party sales from
I-Ventures, Inc. to One World Online, Incorporated.
AGREEMENT AND PLAN OF REORGANIZATION
BETWEEN
MEDIZONE CANADA LIMITED
AND
ONE WORLD ONLINE INCORPORATED
<PAGE>
TABLE OF CONTENTS
1. Plan of Reorganization...........................................1
2. Exchange of Shares...............................................1
3. Pre-Closing Events...............................................2
4. Exchange of Securities...........................................2
5. Other Events Occurring at Closing................................3
6. Delivery of Shares...............................................3
7. Representations of OWO Stockholders..............................3
8. Representations of OWO...........................................4
9. Representations of MCL and Hall..................................5
10. Closing..........................................................7
11. Conditions Precedent to the Obligations of OWO...................7
12. Conditions Precedent to the Obligations of MCL ..................9
13. Indemnification.................................................10
14. Nature and Survival of Representations..........................10
15. Documents at Closing............................................10
16. Finder's Fees...................................................11
17. Miscellaneous...................................................12
Signature Page...............................................................13
Exhibit A - OWO Stockholder Schedule
Exhibit B - Amendment to Articles of Incorporation
Exhibit C - Investment Letter
(i)
<PAGE>
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (hereinafter the "Agreement")
is entered into effective as of this day of June, 1999, by and among Medizone
Canada Limited, a Nevada corporation (hereinafter "MCL"); Brenda Hall, the
principal shareholder of MCL (hereinafter "Hall"); One World Online
Incorporated, a Utah corporation (hereinafter "OWO"), and the owners of all the
outstanding shares of common stock of OWO (hereinafter the "OWO Stockholders").
RECITALS:
WHEREAS, the OWO Stockholders own all of the issued and outstanding
common stock of OWO which comprises 9,500,000 shares (the "OWO Common Stock").
MCL desires to acquire the OWO Common Stock solely in exchange for voting common
stock of MCL, making OWO a wholly-owned subsidiary of MCL; and
WHEREAS, the OWO Stockholders (as set forth on the attached Exhibit
"A") desire to acquire voting common stock of MCL in exchange for the OWO Common
Stock, as more fully set forth herein.
NOW THEREFORE, for the mutual consideration set out herein and other
good and valuable consideration, the legal sufficiency of which is hereby
acknowledged, the parties agree as follows:
AGREEMENT
1. Plan of Reorganization. It is hereby agreed that all of the OWO
Common Stock shall be acquired by MCL in exchange solely for MCL common voting
stock (the "MCL Shares"). It is the intention of the parties hereto that all of
the issued and outstanding shares of capital stock of OWO shall be acquired by
MCL in exchange solely for MCL common voting stock and that this entire
transaction qualify as a corporate reorganization under Section 368(a)(1)(B)
and/or Section 351 of the Internal Revenue Code of 1986, as amended, and related
or other applicable sections thereunder.
2. Exchange of Shares. MCL and OWO Stockholders agree that on the
Closing Date or at the Closing as hereinafter defined, the OWO Common Stock
shall be delivered to MCL in exchange for the MCL Shares, as follows:
(a) At Closing, MCL shall, subject to the conditions set forth herein,
issue an aggregate of 9,500,000 shares of MCL common stock for immediate
delivery to the OWO Stockholders in exchange for the MCL Shares.
1
<PAGE>
(b) Each OWO Stockholder shall execute this Agreement or a written
consent to the exchange of their OWO Common Stock for MCL Shares.
(c) Unless otherwise agreed by MCL and OWO this transaction shall close
only in the event MCL is able to acquire at least 80% of the outstanding OWO
Common Stock; however, it is the intent of the parties to have MCL acquire all
of the OWO Common Stock.
3. Pre-Closing Events. The Closing is subject to the completion of the
following:
(a) MCL shall have authorized 100,000,000 shares of $.001 par value
common stock and 1,000,000 shares of $.001 par value preferred stock. The
preferred stock shall be subject to issuance in such series and with such
rights, preferences and designations as determined in the sole discretion of the
board of directors.
(b) Hall and two other shareholders shall have contributed an aggregate
of 6,250,000 shares of MCL Common Stock to MCL for cancellation, leaving
2,750,000 shares issued and outstanding prior to or at Closing.
(c) MCL shall demonstrate to the reasonable satisfaction of OWO that it
has no material assets and no liabilities contingent or fixed other than as
described herein.
4. Exchange of Securities. As of the Closing Date each of the following
shall occur:
(a) All shares of OWO Common Stock issued and outstanding immediately
prior to the Closing Date shall be exchanged for the MCL Shares (up to an
aggregate amount of 9,500,000 MCL Shares to be delivered at Closing). All such
outstanding shares of OWO Common Stock shall be deemed, after Closing, to be
owned by MCL. The holders of such certificates previously evidencing shares of
OWO Common Stock outstanding immediately prior to the Closing Date shall cease
to have any rights with respect to such shares of OWO Common Stock except as
otherwise provided herein or by law;
(b) Any shares of OWO Common Stock held in the treasury of OWO
immediately prior to the Closing Date shall automatically be canceled and
extinguished without any conversion thereof and no payment shall be made with
respect thereto;
(c) The 2,750,000 shares of MCL common stock previously issued and
outstanding prior to the Closing, after giving effect to the cancellation of
shares, will remain outstanding.
5. Other Events Occurring at Closing. At Closing, the following shall
be accomplished:
(a) MCL shall file an amendment to its Articles of Incorporation with
the Secretary of State of the State of Nevada in substantially the form attached
hereto as Exhibit "B" effecting an amendment to its Articles of Incorporation to
(i) reflect a name change to a new name as selected by OWO, (ii) to change the
2
<PAGE>
authorized capitalization of MCL to include 1,000,000 shares of $.001 par value
preferred stock, and (iii) adopt a provision limiting the liability of officers
and directors, as set forth in the attached Exhibit "B".
(b) The resignation of the existing MCL officer and director and
appointment of new officers and directors as directed by OWO.
(c) MCL shall have completed or shall complete at Closing the
acquisition of I Ventures, Inc., under the terms set forth in its Information
Statement (the "Information Statement") dated June 19, 1999.
(d) MCL shall adopt various stock option programs as outlined in the
Information Statement including an Incentive Stock Option Plan (the "Plan") at
Closing to include up to 4,000,000 shares of its common stock. The Plan shall
include "incentive" stock options under Section 422 of the Internal Revenue Code
of 1986, as amended and other options and similar rights. MCL shall grant
options under said plan to employees and others, at Closing, exercisable at
$1.00 and $2.00 per share, as designated by OWO subject to the reasonable
approval of MCL.
6. Delivery of Shares. On or as soon as practicable after the Closing
Date, OWO will use its best efforts to cause the OWO Stockholders to surrender
certificates for cancellation representing their shares of OWO Common Stock,
against delivery of certificates representing the MCL Shares for which the
shares of OWO Common Stock are to be exchanged at Closing.
7. Representations of OWO Stockholders. Each OWO Stockholder hereby
represents and warrants each only as to its own OWO Common Stock, effective this
date and the Closing Date as follows:
(a) Except as may be set forth in Exhibit "A", the OWO Common Stock is
free from claims, liens, or other encumbrances, and at the Closing Date said OWO
Stockholder will have good title and the unqualified right to transfer and
dispose of such OWO Common Stock.
(b) Said OWO Stockholder is the sole owner of the issued and
outstanding OWO Common Stock as set forth in Exhibit "A";
(c) Said OWO Stockholder has no present intent to sell or dispose of
the MCL Shares and is not under a binding obligation, formal commitment, or
existing plan to sell or otherwise dispose of the MCL Shares.
8. Representations of OWO. OWO hereby represents and warrants as
follows, which warranties and representations shall also be true as of the
Closing Date:
(a) Except as noted on Exhibit "A", the OWO Stockholders listed on the
attached Exhibit "A" are the sole owners of record and beneficially of the
issued and outstanding common stock of OWO.
3
<PAGE>
(b) OWO has no outstanding or authorized capital stock, warrants,
options or convertible securities other than as described in the OWO Financial
Statements or in Exhibit "A", attached hereto.
(c) The audited financial statements as of and for the period ended
December 31, 1998, and unaudited financial statements as of and for the period
ended March 31, 1999, which have been delivered to MCL (hereinafter referred to
as the "OWO Financial Statements") are complete and accurate in all material
respects and fairly present the financial condition of OWO as of the date
thereof and the results of its operations for the period covered. There are no
material liabilities or obligations, either fixed or contingent, not disclosed
in the OWO Financial Statements or notes thereto which are required to be
disclosed therein; OWO has no contracts or obligations in the ordinary course of
business which constitute liens or other liabilities which materially alter the
financial condition of OWO as reflected in the OWO Financial Statements. OWO has
good title to all assets shown on the OWO Financial Statements subject only to
dispositions and other transactions in the ordinary course of business, the
disclosures set forth therein and liens and encumbrances of record. The OWO
Financial Statements have been prepared in accordance with generally accepted
accounting principles consistently applied (except as may be indicated therein
or in the notes thereto).
(d) Since the date of the OWO Financial Statements, there have not been
any material adverse changes in the financial position of OWO except changes
arising in the ordinary course of business, which changes will in no event
materially and adversely affect the financial position of OWO.
(e) OWO is not a party to any material pending litigation or, to its
best knowledge, any governmental investigation or proceeding, not reflected in
the OWO Financial Statements, and to its best knowledge, no material litigation,
claims, assessments or any governmental proceedings are threatened against OWO.
(f) OWO is in good standing in its jurisdiction of incorporation, and
is in good standing and duly qualified to do business in each jurisdiction where
required to be so qualified except where the failure to so qualify would have no
material negative impact on OWO.
(g) OWO has (or, by the Closing Date, will have filed) all material
tax, governmental and/or related forms and reports (or extensions thereof) due
or required to be filed and has (or will have) paid or made adequate provisions
for all taxes or assessments which have become due as of the Closing Date.
(h) OWO has not materially breached any material agreement to which it
is a party. OWO has previously given MCL copies or access thereto of all
material contracts, commitments and/or agreements to which OWO is a party
including all relationships or dealings with related parties or affiliates.
(i) OWO has no subsidiary corporations except as described in writing
to MCL.
4
<PAGE>
(j) OWO has made all material corporate financial records, minute
books, and other corporate documents and records available for review to present
management of MCL prior to the Closing Date, during reasonable business hours
and on reasonable notice.
(k) The execution of this Agreement does not materially violate or
breach any material agreement or contract to which OWO is a party and has been
duly authorized by all appropriate and necessary corporate action under Delaware
of other applicable law and OWO, to the extent required, has obtained all
necessary approvals or consents required by any agreement to which OWO is a
party.
(l) All disclosure information regarding OWO which is to be set forth
in the Information Statement or otherwise delivered to MCL by OWO for use in
connection with the transaction (the "Acquisition") described herein is true,
complete and accurate in all material respects.
9. Representations of MCL and Hall. MCL, and Hall to the best of her
knowledge, hereby jointly and severally represent and warrant as follows, each
of which representations and warranties shall continue to be true as of the
Closing Date:
(a) As of the Closing Date, the MCL Shares, to be issued and delivered
to the OWO Stockholders hereunder will, when so issued and delivered,
constitute, duly authorized, validly and legally issued shares of MCL common
stock, fully-paid and nonassessable. The total number of MCL Shares outstanding
shall be 2,750,000 without giving effect to the shares to be issued as described
in the Information Statement. No shares of MCL's preferred stock, $0.001 par
value, to be authorized at Closing, shall be outstanding.
(b) At Closing, all of the issued and outstanding common stock of MCL,
including shares issued in the MCL Financing, shall be duly authorized, validly
issued, fully-paid and nonassessable and shall have been issued in compliance
with all applicable corporate and securities laws.
(c) MCL has the corporate power to enter into this Agreement and to
perform its obligations hereunder. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by the board of directors of MCL. The execution and performance of
this Agreement will not constitute a material breach of any agreement,
indenture, mortgage, license or other instrument or document to which MCL is a
party and will not violate any judgment, decree, order, writ, rule, statute, or
regulation applicable to MCL or its properties. The execution and performance of
this Agreement will not violate or conflict with any provision of the Articles
of Incorporation or by-laws of MCL.
(d) MCL has delivered to OWO a true and complete copy of its audited
financial statements for the years ended December 31, 1996, 1997, and 1998, and
unaudited financial statements for the period ended March 31, 1999, (the "MCL
Financial Statements"). The MCL Financial Statements are complete, accurate in
5
<PAGE>
all material respects and fairly present the financial condition of MCL as of
the dates thereof and the results of its operations for the periods then ended.
There are no material liabilities or obligations either fixed or contingent not
reflected therein. The MCL Financial Statements have been prepared in accordance
with generally accepted accounting principles applied on a consistent basis
(except as may be indicated therein or in the notes thereto).
(e) Since March 31, 1999, there have not been any material adverse
changes in the financial condition of MCL except with regard to disbursements to
pay reasonable and ordinary expenses in connection with maintaining its
corporate status and pursuing the matters contemplated in this Agreement. Prior
to Closing, all accounts payable and other liabilities of MCL shall be paid and
satisfied in full and MCL shall have no liabilities either contingent or fixed.
(f) Neither Hall nor MCL is a party to or the subject of any pending
litigation, claims, or governmental investigation or proceeding not reflected in
the MCL Financial Statements or otherwise disclosed herein, and there are no
lawsuits, claims, assessments, investigations, or similar matters, to the best
knowledge of Hall, threatened or contemplated against or affecting MCL, its
management or its properties or Hall.
(g) MCL is duly organized, validly existing and in good standing under
the laws of the State of Nevada; has the corporate power to own its property and
to carry on its business as now being conducted and is duly qualified to do
business in any jurisdiction where so required except where the failure to so
qualify would have no material negative impact on it.
(h) MCL has filed all federal, state, county and local income, excise,
property and other tax, governmental and/or related returns, forms, or reports,
which are due or required to be filed by it prior to the date hereof, except
where the failure to do so would have no material adverse impact on MCL, and has
paid or made adequate provision in the MCL Financial Statements for the payment
of all taxes, fees, or assessments which have or may become due pursuant to such
returns or pursuant to any assessments received. MCL is not delinquent or
obligated for any tax, penalty, interest, delinquency or charge.
(i) There are no existing options, calls, warrants, preemptive rights,
registration rights or commitments of any character relating to the issued or
unissued capital stock or other securities of MCL, except as contemplated in
this Agreement.
(j) The corporate financial records, minute books, and other documents
and records of MCL have been made available to OWO prior to the Closing and
shall be delivered to new management of MCL at Closing.
(k) MCL has not breached, nor is there any pending, or to the knowledge
of management, any threatened claim that MCL has breached, any of the terms or
conditions of any agreements, contracts or commitments to which it is a party or
by which it or its assets are is bound. The execution and performance hereof
6
<PAGE>
will not violate any provisions of applicable law or any agreement to which MCL
is subject. MCL hereby represents that it has no business operations or material
assets and it is not a party to any material contract or commitment other than
appointment documents with its transfer agent, and that it has disclosed to OWO
all relationships or dealings with related parties or affiliates.
(l) MCL common stock is currently approved for quotation on the OTC
Bulletin Board under the symbol "MZNCD" and there are no stop orders in effect
with respect thereto and MCL has made all filings currently required to maintain
its listing.
(m) All information regarding MCL which has been provided to OWO or
otherwise disclosed in connection with the transactions contemplated herein, is
true, complete and accurate in all material respects. MCL and Hall specifically
disclaim any responsibility regarding disclosures as to OWO, its business or its
financial condition.
10. Closing. The Closing of the transactions contemplated herein shall
take place on such date (the "Closing") as mutually determined by the parties
hereto when all conditions precedent have been met and all required documents
have been delivered, which Closing is expected to take place on or about June
29, 1999, but no later than June 30, 1999, unless extended by mutual consent of
all parties hereto. The "Closing Date" of the transactions described herein (the
"Acquisition"), shall be that date on which all conditions set forth herein have
been met and the MCL Shares are issued in exchange for the OWO Common Stock.
11. Conditions Precedent to the Obligations of OWO. All obligations of
OWO under this Agreement are subject to the fulfillment, prior to or as of the
Closing and/or the Closing Date, as indicated below, of each of the following
conditions:
(a) The representations and warranties by or on behalf of Hall and MCL
contained in this Agreement or in any certificate or document delivered pursuant
to the provisions hereof shall be true in all material respects at and as of the
Closing and Closing Date as though such representations and warranties were made
at and as of such time.
(b) MCL shall have performed and complied with all covenants,
agreements, and conditions set forth in, and shall have executed and delivered
all documents required by this Agreement to be performed or complied with or
executed and delivered by it prior to or at the Closing.
(c) On or before the Closing, the board of directors, and shareholders
representing a majority interest the outstanding common stock of MCL, shall have
approved in accordance with applicable state corporation law the execution and
delivery of this Agreement and the consummation of the transactions contemplated
herein.
(d) On or before the Closing Date, MCL shall have delivered to OWO
certified copies of resolutions of the board of directors and shareholders of
MCL approving and authorizing the execution, delivery and performance of this
7
<PAGE>
Agreement and authorizing all of the necessary and proper action to enable MCL
to comply with the terms of this Agreement including the election of OWO's
nominees to the Board of Directors of MCL and all matters outlined herein.
(e) The Acquisition shall be permitted by applicable law and MCL shall
have sufficient shares of its capital stock authorized to complete the
Acquisition.
(f) At Closing, the existing sole officer and director of MCL shall
have resigned in writing from all positions as director and officer of MCL
effective upon the election and appointment of the OWO nominees.
(g) At the Closing, all instruments and documents delivered to OWO and
OWO Stockholders pursuant to the provisions hereof shall be reasonably
satisfactory to legal counsel for OWO.
(h) The shares of restricted MCL capital stock to be issued to OWO
Stockholders at Closing will be validly issued, nonassessable and fully-paid
under Nevada corporation law and will be issued in compliance with all federal,
state and applicable corporation and securities laws.
(i) OWO and OWO Stockholders shall have received the advice of their
tax advisor, if deemed necessary by them, as to all tax aspects of the
Acquisition.
(j) OWO shall have received all necessary and required approvals and
consents from required parties and its shareholders.
(k) MCL shall have completed the IVI Acquisition.
(l) At the Closing, MCL shall have delivered to OWO an opinion of its
counsel dated as of the Closing to the effect that:
(i) MCL is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its
incorporation;
(ii) This Agreement has been duly authorized, executed and
delivered by MCL and is a valid and binding obligation of MCL
enforceable in accordance with its terms;
(iii) MCL through its board of directors and stockholders has
taken all corporate action necessary for performance under this
Agreement;
(iv) The documents executed and delivered by MCL to OWO and
OWO Stockholders hereunder are valid and binding in accordance with
their terms and vest in OWO Stockholders, as the case may be, all
right, title and interest in and to the MCL Shares to be issued
pursuant to the terms hereof, and the MCL Shares when issued will be
duly and validly issued, fully-paid and nonassessable;
8
<PAGE>
(v) MCL has the corporate power to execute, deliver and
perform under this Agreement;
(vi) Legal counsel for MCL is not aware of any liabilities,
claims or lawsuits involving MCL;
12. Conditions Precedent to the Obligations of MCL. All obligations of
MCL under this Agreement are subject to the fulfillment, prior to or at the
Closing, of each of the following conditions:
(a) The representations and warranties by OWO and OWO Stockholders
contained in this Agreement or in any certificate or document delivered pursuant
to the provisions hereof shall be true in all material respects at and as of the
Closing as though such representations and warranties were made at and as of
such time.
(b) OWO shall have performed and complied with, in all material
respects, all covenants, agreements, and conditions required by this Agreement
to be performed or complied with by it prior to or at the Closing;
(c) OWO shall deliver on behalf of the OWO Stockholders a consent form
and a letter commonly known as an "Investment Letter," signed by each of said
shareholders, in substantially the form attached hereto as Exhibit "C",
acknowledging that the MCL Shares are being acquired for investment purposes.
(d) OWO shall deliver an opinion of its legal counsel to the effect
that:
(i) OWO is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of incorporation
and is duly qualified to do business in any jurisdiction where so
required except where the failure to so qualify would have no material
adverse impact on OWO;
(ii) This Agreement has been duly authorized, executed and
delivered by OWO.
(iii) The documents executed and delivered by OWO and OWO
Stockholders to MCL hereunder are valid and binding in accordance with
their terms and vest in MCL all right, title and interest in and to the
OWO Common Stock, which stock is duly and validly issued, fully-paid
and nonassessable.
13. Indemnification. For a period of one year from the Closing, MCL and
Hall agree to jointly and severally indemnify and hold harmless OWO, and OWO
agrees to indemnify and hold harmless MCL, at all times after the date of this
Agreement against and in respect of any liability, damage or deficiency, all
actions, suits, proceedings, demands, assessments, judgments, costs and expenses
including attorney's fees incident to any of the foregoing, resulting from any
9
<PAGE>
misrepresentations made by an indemnifying party to an indemnified party, an
indemnifying party's breach of covenant or warranty or an indemnifying party's
nonfulfillment of any agreement hereunder, or from any misrepresentation in or
omission from any certificate furnished or to be furnished hereunder.
14. Nature and Survival of Representations. All representations,
warranties and covenants made by any party in this Agreement shall survive the
Closing and the consummation of the transactions contemplated hereby for one
year from the Closing. All of the parties hereto are executing and carrying out
the provisions of this Agreement in reliance solely on the representations,
warranties and covenants and agreements contained in this Agreement and not upon
any investigation upon which it might have made or any representation, warranty,
agreement, promise or information, written or oral, made by the other party or
any other person other than as specifically set forth herein.
15. Documents at Closing. At the Closing, the following documents shall
be delivered:
(a) OWO will deliver, or will cause to be delivered, to MCL the
following:
(i) a certificate executed by the President and Secretary of
OWO to the effect that all representations and warranties made by OWO
under this Agreement are true and correct as of the Closing, the same
as though originally given to MCL on said date;
(ii) a certificate from the jurisdiction of incorporation of
OWO dated at or about the Closing to the effect that OWO is in good
standing under the laws of said jurisdiction;
(iii) Investment Letters in the form attached hereto as
Exhibit "C" executed by each OWO Stockholder;
(iv) such other instruments, documents and certificates, if
any, as are required to be delivered pursuant to the provisions of this
Agreement;
(v) certified copies of resolutions adopted by the
shareholders and directors of OWO authorizing this transaction; and
(vi) all other items, the delivery of which is a condition
precedent to the obligations of MCL as set forth herein.
(vii) the legal opinion required by Section 12(d) hereof.
(b) MCL will deliver or cause to be delivered to OWO:
(i) stock certificates representing the MCL Shares to be
issued as a part of the stock exchange as described herein;
10
<PAGE>
(ii) a certificate of the President of MCL, to the effect that
all representations and warranties of MCL made under this Agreement are
true and correct as of the Closing, the same as though originally given
to OWO on said date;
(iii) certified copies of resolutions adopted by MCL's board
of directors and MCL's Stockholders authorizing the Acquisition and all
related matters described herein;
(iv) certificate from the jurisdiction of incorporation of MCL
dated at or about the Closing Date that MCL is in good standing under
the laws of said state;
(v) opinion of MCL's counsel as described in Section 11(l)
above;
(vi) resignation of the existing officer and director of MCL;
(vii) all corporate and financial records of MCL; and
(viii) all other items, the delivery of which is a condition
precedent to the obligations of OWO, as set forth in Section 12 hereof.
16. Finder's Fees. MCL represents and warrants to OWO, and OWO
represents and warrants to MCL that neither of them, or any party acting on
their behalf, has incurred any liabilities, either express or implied, to any
"broker" of "finder" or similar person in connection with this Agreement or any
of the transactions contemplated hereby other than arrangements, if any,
disclosed to OWO by MCL to compensate any person who introduced the parties,
which obligation shall be the sole responsibility of MCL. In this regard, MCL,
on the one hand, and OWO on the other hand, will indemnify and hold the other
harmless from any claim, loss, cost or expense whatsoever (including reasonable
fees and disbursements of counsel) from or relating to any such express or
implied liability other than as disclosed herein.
17. Miscellaneous.
(a) Further Assurances. At any time, and from time to time, after the
Closing Date, each party will execute such additional instruments and take such
action as may be reasonably requested by the other party to confirm or perfect
title to any property transferred hereunder or otherwise to carry out the intent
and purposes of this Agreement.
(b) Waiver. Any failure on the part of any party hereto to comply with
any of its obligations, agreements or conditions hereunder may be waived in
writing by the party to whom such compliance is owed.
(c) Amendment. This Agreement may be amended only in writing as agreed
to by all parties hereto.
11
<PAGE>
(d) Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been given if delivered in person or sent by
prepaid first class registered or certified mail, return receipt requested.
(e) Headings. The section and subsection headings in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(f) Counterparts. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
(g) Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Nevada.
(h) Binding Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective heirs,
administrators, executors, successors and assigns.
(i) Entire Agreement. This Agreement and the attached Exhibits
constitute the entire agreement of the parties covering everything agreed upon
or understood in the transaction. There are no oral promises, conditions,
representations, understandings, interpretations or terms of any kind as
conditions or inducements to the execution hereof.
(j) Time. Time is of the essence.
(k) Severability. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first above written.
MEDIZONE CANADA LIMITED
By:/s/ Brenda Hall
---------------------------------
Brenda Hall, President and Secretary
/s/ Brenda Hall
------------------------------------
Brenda Hall, individually
12
<PAGE>
ONE WORLD ONLINE INCORPORATED
By:/s/ David N. Nemelka By:/s/ Wayne Holbrook
---------------------------- ---------------------------
Secretary President
T86agrplorg.ow2
13
<PAGE>
EXHIBIT "A"
To Agreement and Plan of Reorganization
List of OWO Stockholders
------------------------
MCL Shares to be
Name Issued at Closing
- - ---- -----------------
<PAGE>
EXHIBIT "B"
To Agreement and Plan of Reorganization
Form of Amendment to Articles of Incorporation
----------------------------------------------
CERTIFICATE OF AMENDMENT
TO THE ARTICLES OF INCORPORATION
OF
MEDIZONE CANADA LIMITED
Pursuant to the applicable provisions of the Nevada Business
Corporations Act, Medizone Canada Limited (the "Corporation") adopts the
following Articles of Amendment to its Articles of Incorporation:
FIRST: The present name of the Corporation is Medizone Canada Limited.
SECOND: The following amendments to its Articles of Incorporation were
adopted by the board of directors and by majority consent of shareholders of the
Corporation in the manner prescribed by applicable law.
(1) The Article entitled ARTICLE I - NAME, is amended to read as
follows:
ARTICLE I - NAME
The name of the corporation shall be: One World Oneline.com, Inc.
(2) The Article entitled ARTICLE IV - STOCK, is amended to read as
follows:
ARTICLE IV - STOCK
Common. The aggregate number of common shares which this Corporation
shall have authority to issue is 100,000,000 shares of Common Stock having a par
value of $.001 per share. All common stock of the Corporation shall be of the
same class, common, and shall have the same rights and preferences. Fully-paid
common stock of this Corporation shall not be liable to any further call or
assessment.
Preferred. The Corporation shall be authorized to issue 1,000,000
shares of Preferred Stock having a par value of $.001 per share and with such
rights, preferences and designations determined by the board of directors.
(3) Article XII is hereby added and shall read as follows:
ARTICLE XII - ELIMINATION OF LIABILITY OF OFFICERS AND DIRECTORS
No officer or director of the Corporation shall have any liability to
the Corporation or its shareholders for damages for breach of fiduciary duty as
an officer of director except as an officer or director except as specifically
provided for under NRS78.037(1), and as it may be amended from time to time.
<PAGE>
FOURTH: The number of shares of the Corporation outstanding and
entitled to vote at the time of the adoption of said amendment was 9,000,000.
FIFTH: The number of shares voted for such amendments was _________ (
%) and no shares were voted against such amendment.
DATED this 29 day of June, 1999.
MEDIZONE CANADA LIMITED
By:/s/ Brenda Hall
-------------------------------
Brenda Hall, President/Secretary
VERIFICATION
------------
STATE OF UTAH )
: ss.
COUNTY OF SALT LAKE )
The undersigned being first duly sworn, deposes and states: that the
undersigned is the President of Medizone Canada Limited, that the undersigned
has read the Certificate of Amendment and knows the contents thereof and that
the same contains a truthful statement of the Amendment duly adopted by the
board of directors and stockholders of the Corporation.
/s/ Brenda Hall
--------------------
Brenda Hall
<PAGE>
STATE OF UTAH )
: ss.
COUNTY OF SALT LAKE )
Before me the undersigned Notary Public in and for the said County and
State, personally appeared the President and Secretary of Medizone Canada
Limited, a Nevada corporation, and signed the foregoing Articles of Amendment as
her own free and voluntary acts and deeds pursuant to a corporate resolution for
the uses and purposes set forth.
IN WITNESS WHEREOF, I have set my hand and seal this day of June, 1999.
-------------------
NOTARY PUBLIC
Notary Seal:
T86certamd.ow2
<PAGE>
EXHIBIT "C"
To Agreement and Plan of Reorganization
Form of Investment Letter
-------------------------
INVESTMENT LETTER
TO THE BOARD OF DIRECTORS OF MEDIZONE CANADA LIMITED (to become ONE WORLD
ONLINE COM, INC.) ("Corporation")
a. The undersigned hereby represents to the Corporation, that (1) the
shares of the Corporation's common stock (the "Securities") which are being
acquired by the undersigned are being acquired for his own account and for
investment and not with a view to the public resale or distribution thereof; (2)
the undersigned will not sell, transfer or otherwise dispose of the securities
except in compliance with the Securities Act of 1933, as amended (the "Act");
and (3) he is aware that the Securities are "restricted securities" as that term
is defined in Rule 144 or the General Rules and Regulations under the Act.
b. The undersigned acknowledges that he has been afforded access to
disclosure documents and information regarding the Corporation as requested by
the undersigned.
c. The undersigned further acknowledges that he has had an opportunity to
ask questions of and receive answers from duly designated representatives of the
Corporation concerning the terms and conditions pursuant to which the Securities
are being purchased. The undersigned acknowledges that he has been afforded an
opportunity to examine such documents and other information which he has
requested for the purpose of verifying the information set forth in the
documents referred to above.
d. The undersigned acknowledges and understands that the Securities are
unregistered and must be held indefinitely unless they are subsequently
registered under the Act or an exemption from such registration is available.
e. The undersigned further acknowledges that he is fully aware of the
applicable limitations on the resale of the Securities. These restrictions for
the most part are set forth in Rule 144. The Rule permits sales of "restricted
securities" upon compliance with the requirements of such Rule. If the Rule is
available to the undersigned, the undersigned may make only routine sales of
securities, in limited amounts, in accordance with the terms and conditions of
that Rule.
f. The Company is the only person which may register its Securities under
the Act and it currently is not contemplating registering any of its Securities.
Furthermore, the Company has not made any representations, warranties or
covenants to the undersigned regarding registration of the Securities or
compliance with any exemption under the Act.
<PAGE>
g. By reason of my knowledge and experience in financial and business
matters in general, and investments in particular, I am capable of evaluating
the merits and risks of an investment by me in the Securities.
h. I am capable of bearing the economic risks of an investment in the
Securities. I fully understand the speculative nature of the Securities.
j. My present financial condition is such that I am under no present or
contemplated future need to dispose of any portion of the Securities to satisfy
any existing or contemplated undertaking, need, or indebtedness.
j. Any and all certificates representing the Securities, and any and all
securities issued in replacement thereof or in exchange therefor, shall bear the
following legend, which the undersigned has read and understands:
The shares represented by this Certificate have not been registered
under the Securities Act of 1933 (the "Act") and are "restricted
securities" as that term is defined in Rule 144 under the Act. The
shares may not be offered for sale, sold or otherwise transferred
except pursuant to an effective registration statement under the Act or
pursuant to an exemption from registration under the Act, the
availability of which is to be established to the satisfaction of the
Company.
k. The undersigned further agrees that the Corporation shall have the
right to issue stop-transfer instructions to its transfer agent and acknowledges
that the Corporation has informed the undersigned of its intention to issue such
instructions.
l. The undersigned hereby affirms that the undersigned is an accredited
investor, in that the Subscriber qualifies as at least one of the following
(check boxes that apply):
|_| A natural person whose individual net worth, or joint
net worth with that person's spouse, at the time of
the purchase exceeds $1,000,000;
|_| A natural person who had an individual income in
excess of $200,000 in each of the two most recent
years, or joint income with that person's spouse in
excess of $300,000 in each of those years, and has a
reasonable expectation of reaching the same income
level in the current year; or
|_| An entity or trust which meets the definition of
accredited investor contained in Rule 501 of
Regulation D.
<PAGE>
m. The undersigned agrees that no public sale under Rule 144 or
otherwise, assignment or hypothecation or other disposition of the Securities
shall be made for a period of two years from the date of original payment for
the shares being surrendered in exchange for the Securities, without the prior
written consent of the Company. The certificate(s) shall bear an appropriate
legend reflecting the lock-up.
Very truly yours,
Date: June 29, 1999
T86investlt.ow2
AGREEMENT AND PLAN OF REORGANIZATION
BETWEEN
MEDIZONE CANADA LIMITED
AND
I VENTURES, INC.
<PAGE>
TABLE OF CONTENTS
1. Plan of Reorganization..........................................1
2. Exchange of Shares..............................................1
3. Pre-Closing Events..............................................2
4. Exchange of Securities..........................................2
5. Other Events Occurring at Closing...............................3
6. Delivery of Shares..............................................3
7. Representations of IVI Stockholders.............................3
8. Representations of IVI..........................................4
9. Representations of MCL and Hall.................................5
10. Closing.........................................................7
11. Conditions Precedent to the Obligations of IVI..................7
12. Conditions Precedent to the Obligations of MCL .................9
13. Indemnification................................................10
14. Nature and Survival of Representations.........................10
15. Documents at Closing...........................................10
16. Finder's Fees..................................................11
17. Miscellaneous..................................................12
Signature Page..............................................................13
Exhibit A - IVI Stockholder Schedule
Exhibit B - Amendment to Articles of Incorporation
Exhibit C - Investment Letter
(i)
<PAGE>
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (hereinafter the "Agreement")
is entered into effective as of this day of June, 1999, by and among Medizone
Canada Limited, a Nevada corporation (hereinafter "MCL"); Brenda Hall, the
principal shareholder of MCL (hereinafter "Hall"); I Ventures, Inc., a Delaware
corporation (hereinafter "IVI"), and the owners of all the outstanding shares of
common stock of IVI (hereinafter the "IVI Stockholders").
RECITALS:
WHEREAS, the IVI Stockholders own all of the issued and outstanding
common stock of IVI which comprises 3,225,000 shares (the "IVI Common Stock").
MCL desires to acquire the IVI Common Stock solely in exchange for voting common
stock of MCL, making IVI a wholly-owned subsidiary of MCL; and
WHEREAS, the IVI Stockholders (as set forth on the attached Exhibit
"A") desire to acquire voting common stock of MCL in exchange for the IVI Common
Stock, as more fully set forth herein.
NOW THEREFORE, for the mutual consideration set out herein and other
good and valuable consideration, the legal sufficiency of which is hereby
acknowledged, the parties agree as follows:
AGREEMENT
1. Plan of Reorganization. It is hereby agreed that all of the IVI
Common Stock shall be acquired by MCL in exchange solely for MCL common voting
stock (the "MCL Shares"). It is the intention of the parties hereto that all of
the issued and outstanding shares of capital stock of IVI shall be acquired by
MCL in exchange solely for MCL common voting stock and that this entire
transaction qualify as a corporate reorganization under Section 368(a)(1)(B)
and/or Section 351 of the Internal Revenue Code of 1986, as amended, and related
or other applicable sections thereunder.
2. Exchange of Shares. MCL and IVI Stockholders agree that on the
Closing Date or at the Closing as hereinafter defined, the IVI Common Stock
shall be delivered to MCL in exchange for the MCL Shares, as follows:
(a) At Closing, MCL shall, subject to the conditions set forth herein,
issue an aggregate of 3,225,000 shares of MCL common stock for immediate
delivery to the IVI Stockholders in exchange for the MCL Shares.
(b) Each IVI Stockholder shall execute this Agreement or a written
consent to the exchange of their IVI Common Stock for MCL Shares.
<PAGE>
(c) Unless otherwise agreed by MCL and IVI this transaction shall close
only in the event MCL is able to acquire at least 80% of the outstanding IVI
Common Stock; however, it is the intent of the parties to have MCL acquire all
of the IVI Common Stock.
3. Pre-Closing Events. The Closing is subject to the completion of the
following:
(a) MCL shall have authorized 100,000,000 shares of $.001 par value
common stock and 1,000,000 shares of $.001 par value preferred stock. The
preferred stock shall be subject to issuance in such series and with such
rights, preferences and designations as determined in the sole discretion of the
board of directors.
(b) Hall and two other shareholders shall have contributed an aggregate
of 6,250,000 shares of MCL Common Stock to MCL for cancellation, leaving
2,750,000 shares issued and outstanding prior to or at the Closing.
(c) MCL shall demonstrate to the reasonable satisfaction of IVI that it
has no material assets and no liabilities contingent or fixed other than as
described herein.
4. Exchange of Securities. As of the Closing Date each of the following
shall occur:
(a) All shares of IVI Common Stock issued and outstanding immediately
prior to the Closing Date shall be exchanged for the MCL Shares (up to an
aggregate amount of 3,225,000 MCL Shares to be delivered at Closing). All such
outstanding shares of IVI Common Stock shall be deemed, after Closing, to be
owned by MCL. The holders of such certificates previously evidencing shares of
IVI Common Stock outstanding immediately prior to the Closing Date shall cease
to have any rights with respect to such shares of IVI Common Stock except as
otherwise provided herein or by law;
(b) Any shares of IVI Common Stock held in the treasury of IVI
immediately prior to the Closing Date shall automatically be canceled and
extinguished without any conversion thereof and no payment shall be made with
respect thereto;
(c) The 2,750,000 shares of MCL common stock previously issued and
outstanding prior to the Closing, after giving effect to the cancellation of
shares, will remain outstanding.
5. Other Events Occurring at Closing. At Closing, the following shall
be accomplished:
(a) MCL shall file an amendment to its Articles of Incorporation with
the Secretary of State of the State of Nevada in substantially the form attached
hereto as Exhibit "B" effecting an amendment to its Articles of Incorporation to
(i) reflect a name change to One World Online.com, Inc. or a derivation thereof,
(ii) to change the authorized capitalization of MCL to include 1,000,000 shares
of $.001 par value preferred stock, and (iii) adopt a provision limiting the
liability of officers and directors, as set forth in the attached Exhibit "B".
(b) The resignation of the existing MCL officer and director and
<PAGE>
appointment of new officers and directors as set forth in the Information
Statement.
(c) MCL shall have completed or shall complete at Closing the
acquisition of One World Online Incorporated, under the terms set forth in its
Information Statement (the "Information Statement") dated June 19, 1999.
(d) MCL shall adopt various stock option programs as outlined in the
Information Statement including an Incentive Stock Option Plan (the "Plan") at
Closing to include up to 4,000,000 shares of its common stock. The Plan shall
include "incentive" stock options under Section 422 of the Internal Revenue Code
of 1986, as amended and other options and similar rights. MCL shall grant
options under said plan to employees and others, at Closing, exercisable at
$1.00 and $2.00 per share, as designated by IVI subject to the reasonable
approval of MCL.
6. Delivery of Shares. On or as soon as practicable after the Closing
Date, IVI will use its best efforts to cause the IVI Stockholders to surrender
certificates for cancellation representing their shares of IVI Common Stock,
against delivery of certificates representing the MCL Shares for which the
shares of IVI Common Stock are to be exchanged at Closing.
7. Representations of IVI Stockholders. Each IVI Stockholder hereby
represents and warrants each only as to its own IVI Common Stock, effective this
date and the Closing Date as follows:
(a) Except as may be set forth in Exhibit "A", the IVI Common Stock is
free from claims, liens, or other encumbrances, and at the Closing Date said IVI
Stockholder will have good title and the unqualified right to transfer and
dispose of such IVI Common Stock.
(b) Said IVI Stockholder is the sole owner of the issued and
outstanding IVI Common Stock as set forth in Exhibit "A";
(c) Said IVI Stockholder has no present intent to sell or dispose of
the MCL Shares and is not under a binding obligation, formal commitment, or
existing plan to sell or otherwise dispose of the MCL Shares.
8. Representations of IVI. IVI hereby represents and warrants as
follows, which warranties and representations shall also be true as of the
Closing Date:
(a) Except as noted on Exhibit "A", the IVI Stockholders listed on the
attached Exhibit "A" are the sole owners of record and beneficially of the
issued and outstanding common stock of IVI.
(b) IVI has no outstanding or authorized capital stock, warrants,
options or convertible securities other than as described in the IVI Financial
Statements or in Exhibit "A", attached hereto.
(c) The audited financial statements as of and for the period ended
December 31, 1998, and unaudited financial statements as of and for the period
ended March 31, 1999, which have been delivered to MCL (hereinafter referred to
<PAGE>
as the "IVI Financial Statements") are complete and accurate in all material
respects and fairly present the financial condition of IVI as of the date
thereof and the results of its operations for the period covered. There are no
material liabilities or obligations, either fixed or contingent, not disclosed
in the IVI Financial Statements or notes thereto which are required to be
disclosed therein; IVI has no contracts or obligations in the ordinary course of
business which constitute liens or other liabilities which materially alter the
financial condition of IVI as reflected in the IVI Financial Statements. IVI has
good title to all assets shown on the IVI Financial Statements subject only to
dispositions and other transactions in the ordinary course of business, the
disclosures set forth therein and liens and encumbrances of record. The IVI
Financial Statements have been prepared in accordance with generally accepted
accounting principles consistently applied (except as may be indicated therein
or in the notes thereto).
(d) Since the date of the IVI Financial Statements, there have not been
any material adverse changes in the financial position of IVI except changes
arising in the ordinary course of business, which changes will in no event
materially and adversely affect the financial position of IVI.
(e) IVI is not a party to any material pending litigation or, to its
best knowledge, any governmental investigation or proceeding, not reflected in
the IVI Financial Statements, and to its best knowledge, no material litigation,
claims, assessments or any governmental proceedings are threatened against IVI.
(f) IVI is in good standing in its jurisdiction of incorporation, and
is in good standing and duly qualified to do business in each jurisdiction where
required to be so qualified except where the failure to so qualify would have no
material negative impact on IVI.
(g) IVI has (or, by the Closing Date, will have filed) all material
tax, governmental and/or related forms and reports (or extensions thereof) due
or required to be filed and has (or will have) paid or made adequate provisions
for all taxes or assessments which have become due as of the Closing Date.
(h) IVI has not materially breached any material agreement to which it
is a party. IVI has previously given MCL copies or access thereto of all
material contracts, commitments and/or agreements to which IVI is a party
including all relationships or dealings with related parties or affiliates.
(i) IVI has no subsidiary corporations except as described in writing
to MCL.
(j) IVI has made all material corporate financial records, minute
books, and other corporate documents and records available for review to present
management of MCL prior to the Closing Date, during reasonable business hours
and on reasonable notice.
(k) The execution of this Agreement does not materially violate or
breach any material agreement or contract to which IVI is a party and has been
duly authorized by all appropriate and necessary corporate action under Delaware
of other applicable law and IVI, to the extent required, has obtained all
necessary approvals or consents required by any agreement to which IVI is a
party.
<PAGE>
(l) All disclosure information regarding IVI which is to be set forth
in the Information Statement or otherwise delivered to MCL by IVI for use in
connection with the transaction (the "Acquisition") described herein is true,
complete and accurate in all material respects.
9. Representations of MCL and Hall. MCL, and Hall to the best of her
knowledge, hereby jointly and severally represent and warrant as follows, each
of which representations and warranties shall continue to be true as of the
Closing Date:
(a) As of the Closing Date, the MCL Shares, to be issued and delivered
to the IVI Stockholders hereunder will, when so issued and delivered,
constitute, duly authorized, validly and legally issued shares of MCL common
stock, fully-paid and nonassessable. The total number of MCL Shares outstanding
shall be 2,750,000 without giving effect to the shares to be issued as described
in the Information Statement. No shares of MCL's preferred stock, $0.001 par
value, to be authorized at Closing, shall be outstanding.
(b) At Closing, all of the issued and outstanding common stock of MCL,
including shares issued in the MCL Financing, shall be duly authorized, validly
issued, fully-paid and nonassessable and shall have been issued in compliance
with all applicable corporate and securities laws.
(c) MCL has the corporate power to enter into this Agreement and to
perform its obligations hereunder. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by the board of directors of MCL. The execution and performance of
this Agreement will not constitute a material breach of any agreement,
indenture, mortgage, license or other instrument or document to which MCL is a
party and will not violate any judgment, decree, order, writ, rule, statute, or
regulation applicable to MCL or its properties. The execution and performance of
this Agreement will not violate or conflict with any provision of the Articles
of Incorporation or by-laws of MCL.
(d) MCL has delivered to IVI a true and complete copy of its audited
financial statements for the years ended December 31, 1996, 1997, and 1998, and
unaudited financial statements for the period ended March 31, 1999, (the "MCL
Financial Statements"). The MCL Financial Statements are complete, accurate in
all material respects and fairly present the financial condition of MCL as of
the dates thereof and the results of its operations for the periods then ended.
There are no material liabilities or obligations either fixed or contingent not
reflected therein. The MCL Financial Statements have been prepared in accordance
with generally accepted accounting principles applied on a consistent basis
(except as may be indicated therein or in the notes thereto).
(e) Since March 31, 1999, there have not been any material adverse
changes in the financial condition of MCL except with regard to disbursements to
pay reasonable and ordinary expenses in connection with maintaining its
corporate status and pursuing the matters contemplated in this Agreement. Prior
to Closing, all accounts payable and other liabilities of MCL shall be paid and
satisfied in full and MCL shall have no liabilities either contingent or fixed.
(f) Neither Hall nor MCL is a party to or the subject of any pending
<PAGE>
litigation, claims, or governmental investigation or proceeding not reflected in
the MCL Financial Statements or otherwise disclosed herein, and there are no
lawsuits, claims, assessments, investigations, or similar matters, to the best
knowledge of Hall, threatened or contemplated against or affecting MCL, its
management or its properties or Hall.
(g) MCL is duly organized, validly existing and in good standing under
the laws of the State of Nevada; has the corporate power to own its property and
to carry on its business as now being conducted and is duly qualified to do
business in any jurisdiction where so required except where the failure to so
qualify would have no material negative impact on it.
(h) MCL has filed all federal, state, county and local income, excise,
property and other tax, governmental and/or related returns, forms, or reports,
which are due or required to be filed by it prior to the date hereof, except
where the failure to do so would have no material adverse impact on MCL, and has
paid or made adequate provision in the MCL Financial Statements for the payment
of all taxes, fees, or assessments which have or may become due pursuant to such
returns or pursuant to any assessments received. MCL is not delinquent or
obligated for any tax, penalty, interest, delinquency or charge.
(i) There are no existing options, calls, warrants, preemptive rights,
registration rights or commitments of any character relating to the issued or
unissued capital stock or other securities of MCL, except as contemplated in
this Agreement.
(j) The corporate financial records, minute books, and other documents
and records of MCL have been made available to IVI prior to the Closing and
shall be delivered to new management of MCL at Closing.
(k) MCL has not breached, nor is there any pending, or to the knowledge
of management, any threatened claim that MCL has breached, any of the terms or
conditions of any agreements, contracts or commitments to which it is a party or
by which it or its assets are is bound. The execution and performance hereof
will not violate any provisions of applicable law or any agreement to which MCL
is subject. MCL hereby represents that it has no business operations or material
assets and it is not a party to any material contract or commitment other than
appointment documents with its transfer agent, and that it has disclosed to IVI
all relationships or dealings with related parties or affiliates.
(l) MCL common stock is currently approved for quotation on the OTC
Bulletin Board under the symbol "MZNCD" and there are no stop orders in effect
with respect thereto and MCL has made all filings currently required to maintain
its listing.
(m) All information regarding MCL which has been provided to IVI or
otherwise disclosed in connection with the transactions contemplated herein, is
true, complete and accurate in all material respects. MCL and Hall specifically
disclaim any responsibility regarding disclosures as to IVI, its business or its
financial condition.
10. Closing. The Closing of the transactions contemplated herein shall
<PAGE>
take place on such date (the "Closing") as mutually determined by the parties
hereto when all conditions precedent have been met and all required documents
have been delivered, which Closing is expected to take place on or about June
29, 1999, but no later than June 30, 1999, unless extended by mutual consent of
all parties hereto. The "Closing Date" of the transactions described herein (the
"Acquisition"), shall be that date on which all conditions set forth herein have
been met and the MCL Shares are issued in exchange for the IVI Common Stock.
11. Conditions Precedent to the Obligations of IVI. All obligations of
IVI under this Agreement are subject to the fulfillment, prior to or as of the
Closing and/or the Closing Date, as indicated below, of each of the following
conditions:
(a) The representations and warranties by or on behalf of Hall and MCL
contained in this Agreement or in any certificate or document delivered pursuant
to the provisions hereof shall be true in all material respects at and as of the
Closing and Closing Date as though such representations and warranties were made
at and as of such time.
(b) MCL shall have performed and complied with all covenants,
agreements, and conditions set forth in, and shall have executed and delivered
all documents required by this Agreement to be performed or complied with or
executed and delivered by it prior to or at the Closing.
(c) On or before the Closing, the board of directors, and shareholders
representing a majority interest the outstanding common stock of MCL, shall have
approved in accordance with applicable state corporation law the execution and
delivery of this Agreement and the consummation of the transactions contemplated
herein.
(d) On or before the Closing Date, MCL shall have delivered to IVI
certified copies of resolutions of the board of directors and shareholders of
MCL approving and authorizing the execution, delivery and performance of this
Agreement and authorizing all of the necessary and proper action to enable MCL
to comply with the terms of this Agreement including the election of IVI's
nominees to the Board of Directors of MCL and all matters outlined herein.
(e) The Acquisition shall be permitted by applicable law and MCL shall
have sufficient shares of its capital stock authorized to complete the
Acquisition.
(f) At Closing, the existing sole officer and director of MCL shall
have resigned in writing from all positions as director and officer of MCL
effective upon the election and appointment of the IVI nominees.
(g) At the Closing, all instruments and documents delivered to IVI and
IVI Stockholders pursuant to the provisions hereof shall be reasonably
satisfactory to legal counsel for IVI.
(h) The shares of restricted MCL capital stock to be issued to IVI
Stockholders at Closing will be validly issued, nonassessable and fully-paid
under Nevada corporation law and will be issued in compliance with all federal,
state and applicable corporation and securities laws.
<PAGE>
(i) IVI and IVI Stockholders shall have received the advice of their
tax advisor, if deemed necessary by them, as to all tax aspects of the
Acquisition.
(j) IVI shall have received all necessary and required approvals and
consents from required parties and its shareholders.
(k) MCL shall have completed the IVI Acquisition.
(l) At the Closing, MCL shall have delivered to IVI an opinion of its
counsel dated as of the Closing to the effect that:
(i) MCL is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its
incorporation;
(ii) This Agreement has been duly authorized, executed and
delivered by MCL and is a valid and binding obligation of MCL
enforceable in accordance with its terms;
(iii) MCL through its board of directors and stockholders has
taken all corporate action necessary for performance under this
Agreement;
(iv) The documents executed and delivered by MCL to IVI and
IVI Stockholders hereunder are valid and binding in accordance with
their terms and vest in IVI Stockholders, as the case may be, all
right, title and interest in and to the MCL Shares to be issued
pursuant to the terms hereof, and the MCL Shares when issued will be
duly and validly issued, fully-paid and nonassessable;
(v) MCL has the corporate power to execute, deliver and
perform under this Agreement;
(vi) Legal counsel for MCL is not aware of any liabilities,
claims or lawsuits involving MCL;
12. Conditions Precedent to the Obligations of MCL. All obligations of
MCL under this Agreement are subject to the fulfillment, prior to or at the
Closing, of each of the following conditions:
(a) The representations and warranties by IVI and IVI Stockholders
contained in this Agreement or in any certificate or document delivered pursuant
to the provisions hereof shall be true in all material respects at and as of the
Closing as though such representations and warranties were made at and as of
such time.
(b) IVI shall have performed and complied with, in all material
respects, all covenants, agreements, and conditions required by this Agreement
to be performed or complied with by it prior to or at the Closing;
<PAGE>
(c) IVI shall deliver on behalf of the IVI Stockholders a consent form
and a letter commonly known as an "Investment Letter," signed by each of said
shareholders, in substantially the form attached hereto as Exhibit "C",
acknowledging that the MCL Shares are being acquired for investment purposes.
(d) IVI shall deliver an opinion of its legal counsel to the effect
that:
(i) IVI is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of incorporation
and is duly qualified to do business in any jurisdiction where so
required except where the failure to so qualify would have no material
adverse impact on IVI;
(ii) This Agreement has been duly authorized, executed and
delivered by IVI.
(iii) The documents executed and delivered by IVI and IVI
Stockholders to MCL hereunder are valid and binding in accordance with
their terms and vest in MCL all right, title and interest in and to the
IVI Common Stock, which stock is duly and validly issued, fully-paid
and nonassessable.
13. Indemnification. For a period of one year from the Closing, MCL and
Hall agree to jointly and severally indemnify and hold harmless IVI, and IVI
agrees to indemnify and hold harmless MCL, at all times after the date of this
Agreement against and in respect of any liability, damage or deficiency, all
actions, suits, proceedings, demands, assessments, judgments, costs and expenses
including attorney's fees incident to any of the foregoing, resulting from any
misrepresentations made by an indemnifying party to an indemnified party, an
indemnifying party's breach of covenant or warranty or an indemnifying party's
nonfulfillment of any agreement hereunder, or from any misrepresentation in or
omission from any certificate furnished or to be furnished hereunder.
14. Nature and Survival of Representations. All representations,
warranties and covenants made by any party in this Agreement shall survive the
Closing and the consummation of the transactions contemplated hereby for one
year from the Closing. All of the parties hereto are executing and carrying out
the provisions of this Agreement in reliance solely on the representations,
warranties and covenants and agreements contained in this Agreement and not upon
any investigation upon which it might have made or any representation, warranty,
agreement, promise or information, written or oral, made by the other party or
any other person other than as specifically set forth herein.
15. Documents at Closing. At the Closing, the following documents shall
be delivered:
(a) IVI will deliver, or will cause to be delivered, to MCL the
following:
(i) a certificate executed by the President and Secretary of
IVI to the effect that all representations and warranties made by IVI
under this Agreement are true and correct as of the Closing, the same
as though originally given to MCL on said date;
<PAGE>
(ii) a certificate from the jurisdiction of incorporation of
IVI dated at or about the Closing to the effect that IVI is in good
standing under the laws of said jurisdiction;
(iii) Investment Letters in the form attached hereto as
Exhibit "C" executed by each IVI Stockholder;
(iv) such other instruments, documents and certificates, if
any, as are required to be delivered pursuant to the provisions of this
Agreement;
(v) certified copies of resolutions adopted by the
shareholders and directors of IVI authorizing this transaction; and
(vi) all other items, the delivery of which is a condition
precedent to the obligations of MCL as set forth herein.
(vii) the legal opinion required by Section 12(d) hereof.
(b) MCL will deliver or cause to be delivered to IVI:
(i) stock certificates representing the MCL Shares to be
issued as a part of the stock exchange as described herein;
(ii) a certificate of the President of MCL, to the effect that
all representations and warranties of MCL made under this Agreement are
true and correct as of the Closing, the same as though originally given
to IVI on said date;
(iii) certified copies of resolutions adopted by MCL's board
of directors and MCL's Stockholders authorizing the Acquisition and all
related matters described herein;
(iv) certificate from the jurisdiction of incorporation of MCL
dated at or about the Closing Date that MCL is in good standing under
the laws of said state;
(v) opinion of MCL's counsel as described in Section 11(l)
above;
(vi) resignation of the existing officer and director of MCL;
(vii) all corporate and financial records of MCL; and
(viii) all other items, the delivery of which is a condition
precedent to the obligations of IVI, as set forth in Section 12 hereof.
16. Finder's Fees. MCL represents and warrants to IVI, and IVI
represents and warrants to MCL that neither of them, or any party acting on
their behalf, has incurred any liabilities, either express or implied, to any
<PAGE>
"broker" of "finder" or similar person in connection with this Agreement or any
of the transactions contemplated hereby other than arrangements, if any,
disclosed to IVI by MCL to compensate any person who introduced the parties,
which obligation shall be the sole responsibility of MCL. In this regard, MCL,
on the one hand, and IVI on the other hand, will indemnify and hold the other
harmless from any claim, loss, cost or expense whatsoever (including reasonable
fees and disbursements of counsel) from or relating to any such express or
implied liability other than as disclosed herein.
17. Miscellaneous.
(a) Further Assurances. At any time, and from time to time, after the
Closing Date, each party will execute such additional instruments and take such
action as may be reasonably requested by the other party to confirm or perfect
title to any property transferred hereunder or otherwise to carry out the intent
and purposes of this Agreement.
(b) Waiver. Any failure on the part of any party hereto to comply with
any of its obligations, agreements or conditions hereunder may be waived in
writing by the party to whom such compliance is owed.
(c) Amendment. This Agreement may be amended only in writing as agreed
to by all parties hereto.
(d) Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been given if delivered in person or sent by
prepaid first class registered or certified mail, return receipt requested.
(e) Headings. The section and subsection headings in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(f) Counterparts. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
(g) Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Nevada.
(h) Binding Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective heirs,
administrators, executors, successors and assigns.
(i) Entire Agreement. This Agreement and the attached Exhibits
constitute the entire agreement of the parties covering everything agreed upon
or understood in the transaction. There are no oral promises, conditions,
representations, understandings, interpretations or terms of any kind as
conditions or inducements to the execution hereof.
<PAGE>
(j) Time. Time is of the essence.
(k) Severability. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first above written.
MEDIZONE CANADA LIMITED
By:/s/ Brenda Hall
---------------------------------
Brenda Hall, President and Secretary
/s/ Brenda Hall
------------------------------------
Brenda Hall, individually
<PAGE>
I VENTURES, INC.
By:/s/ Joseph M. Udall By:/s/ Jeff Martin
---------------------------- ---------------------------
Secretary President
T87agrplorg.iv2
EXHIBIT "A"
To Agreement and Plan of Reorganization
List of IVI Stockholders
------------------------
MCL Shares to be
Name Issued at Closing
- - ----- -----------------
<PAGE>
EXHIBIT "B"
To Agreement and Plan of Reorganization
Form of Amendment to Articles of Incorporation
----------------------------------------------
<PAGE>
EXHIBIT "C"
To Agreement and Plan of Reorganization
Form of Investment Letter
-------------------------
CERTIFICATE OF AMENDMENT
TO THE ARTICLES OF INCORPORATION
OF
MEDIZONE CANADA LIMITED
Pursuant to the applicable provisions of the Nevada Business
Corporations Act, Medizone Canada Limited (the "Corporation") adopts the
following Articles of Amendment to its Articles of Incorporation:
FIRST: The present name of the Corporation is Medizone Canada Limited.
SECOND: The following amendments to its Articles of Incorporation were
adopted by the board of directors and by majority consent of shareholders of the
Corporation in the manner prescribed by applicable law.
(1) The Article entitled ARTICLE I - NAME, is amended to read as
follows:
ARTICLE I - NAME
The name of the corporation shall be: One World Oneline.com, Inc.
(2) The Article entitled ARTICLE IV - STOCK, is amended to read as
follows:
ARTICLE IV - STOCK
Common. The aggregate number of common shares which this Corporation
shall have authority to issue is 100,000,000 shares of Common Stock having a par
value of $.001 per share. All common stock of the Corporation shall be of the
same class, common, and shall have the same rights and preferences. Fully-paid
common stock of this Corporation shall not be liable to any further call or
assessment.
Preferred. The Corporation shall be authorized to issue 1,000,000
shares of Preferred Stock having a par value of $.001 per share and with such
rights, preferences and designations determined by the board of directors.
(3) Article XII is hereby added and shall read as follows:
ARTICLE XII - ELIMINATION OF LIABILITY OF OFFICERS AND DIRECTORS
No officer or director of the Corporation shall have any liability to
the Corporation or its shareholders for damages for breach of fiduciary duty as
an officer of director except as an officer or director except as specifically
provided for under NRS78.037(1), and as it may be amended from time to time.
<PAGE>
FOURTH: The number of shares of the Corporation outstanding and
entitled to vote at the time of the adoption of said amendment was 9,000,000.
FIFTH: The number of shares voted for such amendments was _________ (
%) and no shares were voted against such amendment.
DATED this 29 day of June, 1999.
MEDIZONE CANADA LIMITED
By:/s/ Brenda Hall
-------------------------------
Brenda Hall, President/Secretary
VERIFICATION
------------
STATE OF UTAH )
: ss.
COUNTY OF SALT LAKE )
The undersigned being first duly sworn, deposes and states: that the
undersigned is the President of Medizone Canada Limited, that the undersigned
has read the Certificate of Amendment and knows the contents thereof and that
the same contains a truthful statement of the Amendment duly adopted by the
board of directors and stockholders of the Corporation.
/s/ Brenda Hall
--------------------
Brenda Hall
<PAGE>
STATE OF UTAH )
: ss.
COUNTY OF SALT LAKE )
Before me the undersigned Notary Public in and for the said County and
State, personally appeared the President and Secretary of Medizone Canada
Limited, a Nevada corporation, and signed the foregoing Articles of Amendment as
her own free and voluntary acts and deeds pursuant to a corporate resolution for
the uses and purposes set forth.
IN WITNESS WHEREOF, I have set my hand and seal this day of June, 1999.
-------------------
NOTARY PUBLIC
Notary Seal:
T86certamd.ow2
Securities and Exchange Commission
450 5th Street, N.W.
Washington, D.C. 20549 July 12, 1999
To Whom it May Concern:
We have been furnished with a copy of the response to Item 4 of Form 8-K for the
event that occurred on June 29, 1999, to be filed by our former client Medizone
Canada Limited (Currently One World Online.com, Inc.). We agree with the
statements made in response to that Item insofar as they relate to our firm.
Very Truly Yours,
Andersen Andersen & Strong L.C.
U.S. Securities and Exchange Commission
Washington, D.C. 20549
We have read One World Online.com, Inc. Form 8-K dated June 29, 1999
regarding "Charges in Registrant's Certifying Accountant" and as pertaining to
our firm, we agree with the statements contained herein.
TANNER + CO.
Salt Lake City, Utah
July 14, 1999
