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AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER ("Merger Agreement") is made and
entered into pursuant to Delaware General Corporate Law ss.253 and Iowa Business
Corporate Act ss. 490.1107 as of the 26th day of November, 1997, by and between
PAYLESS CASHWAYS, INC., an Iowa corporation ("Payless Iowa"), and PAYLESS
CASHWAYS ACQUISITION, INC., a Delaware corporation ("Payless Delaware").
WHEREAS, Payless Iowa, on the date of this Merger Agreement, has
authority to issue 150,000,000 shares of voting common stock, par value $.01 per
share, 5,000,000 shares of non-voting Class A common stock, par value $.01 per
share, 5,000,000 shares of non-voting Class B common stock, par value $.01 per
share, and 25,000,000 shares of preferred stock, par value $1.00 per share;
WHEREAS, Payless Delaware, on the date of this Merger Agreement, has
authority to issue 50,000,000 shares of common stock, par value $.01 per share;
WHEREAS, the merger of Payless Iowa with and into Payless Delaware is
to be effectuated in accordance with that certain First Amended Plan of
Reorganization, dated September 5, 1997, as modified on October 9, 1997, and
filed in the matter captioned In re Payless Cashways, Inc., Case No. 00-00000-00
(as modified by the Order and at the November 19 hearing, the "Plan") and
confirmed by the United States Bankruptcy Court for the Western District of
Missouri on November 19, 1997 (the "Order").
NOW THEREFORE, in consideration of the mutual agreements and covenants
set forth herein, Payless Iowa and Payless Delaware hereby agree to merge as
follows:
1. Merger. Subject to the terms and conditions of this Merger
Agreement, Payless Iowa shall be merged with and into Payless Delaware, and
Payless Delaware shall survive the merger ("Merger"), effective at the Effective
Time, as hereinafter defined.
2. Effective Time. Subject to the provisions of this Merger Agreement,
a certificate of ownership and merger shall be duly executed and filed with the
Secretary of State of Delaware and articles of merger shall be duly executed and
filed with the Secretary of State of Iowa. The Merger shall become effective at
9:00 a.m. E.S.T. on the date specified in the filings to be made with the
secretaries of state of Delaware and Iowa. The date and time when the Merger
shall become effective is herein referred to as the "Effective Time."
3. Succession. At the Effective Time, the separate existence of Payless
Iowa shall cease, and Payless Delaware shall be the surviving corporation and
shall succeed to the rights, assets, liabilities and obligations of Payless Iowa
in the manner and to the extent more fully set
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forth in the Delaware General Corporation Law and the Plan, each as presently in
effect or as may hereafter be amended.
4. Directors and Officers and Governing Documents. The directors and
officers of Payless Delaware at the Effective Time shall be the directors and
officers of Payless Delaware as the surviving corporation from and after the
Effective Time until their death, resignation, disqualification or removal from
office, election and qualification of a successor or termination of employment.
The certificate of incorporation of Payless Delaware, as in effect at the
Effective Time, shall continue to be the certificate of incorporation of Payless
Delaware as the surviving corporation without change or amendment until further
amended in accordance with the provisions thereof and applicable law. The bylaws
of Payless Delaware, as in effect at the Effective Time, shall continue to be
the bylaws of Payless Delaware as the surviving corporation without change or
amendment until further amended in accordance with the provisions thereof, the
certificate of incorporation of Payless Delaware and applicable law.
5. Further Assurances. From time to time, as and when required by
Payless Delaware or by its successors and assigns, there shall be executed and
delivered on behalf of Payless Iowa such deeds and other instruments, and there
shall be taken or caused to be taken by it such further and other action, as
shall be appropriate or necessary in order to vest, perfect or confirm, of
record or otherwise, in Payless Delaware the title to and possession of all
property, interests, assets, rights, privileges, immunities, powers, franchises
and authority of Payless Iowa, and otherwise to carry out the purposes of this
Merger Agreement and the Plan, and the officers and directors of Payless
Delaware are fully authorized in the name and on behalf of Payless Iowa or
otherwise to take any and all such action and to execute and deliver any and all
such deeds and other instruments.
6. Stock, Retirement and Conversion. At the Effective Time, the 100
shares of Payless Delaware common stock presently issued and outstanding in the
name of Payless Iowa shall be canceled and retired and resume the status of
authorized and unissued shares of Payless Delaware common stock, and no shares
of Payless Delaware common stock or other securities or property of Payless
Delaware shall be issued or delivered in respect thereof. At the Effective Time,
by virtue of the Merger and without any action on the part of any holder of
common or preferred stock of Payless Iowa, all such stock shall be converted
into shares of Payless Delaware common stock, as and to the extent set forth in
the Plan and no other shares of common stock or other securities or property of
Payless Delaware shall be issued or delivered in respect thereof.
7. Employee Benefit Plans. As of the Effective Time, and as set forth
in the Plan and the related First Amended Disclosure Statement, dated October 9,
1997, Payless Delaware hereby assumes all obligations of Payless Iowa under any
and all employee benefit plans in effect as of said date or with respect to
which employee rights or accrued benefits are outstanding as of said date.
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8. Book Entries. At the Effective Time, entries shall be made upon the
books of Payless Delaware to adjust the assets, liabilities and owner's equity
of the corporation pursuant to Statement of Position 90-7 of the American
Institute of Certified Public Accountants and in a manner consistent with the
Plan.
9. Abandonment. At any time before the Effective Time, this Merger
Agreement may be terminated and the Merger may be abandoned by the board of
directors of either Payless Delaware or Payless Iowa.
10. Counterparts. In order to facilitate the filing and recording of
this Merger Agreement the same may be executed in any number of counterparts,
each of which shall be deemed to be an original.
11. Descriptive Headings. The descriptive headings herein are inserted
for convenience of reference only and are not intended to be part of or to
affect the meaning or interpretation of this Merger Agreement.
12. Governing Law. This Merger Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware as presently in
effect or as hereafter amended.
IN WITNESS WHEREOF, this Merger Agreement is hereby executed on behalf
of Payless Iowa and Payless Delaware by their respective duly authorized
officers.
PAYLESS CASHWAYS ACQUISITION, INC.,
Delaware corporation
ATTEST:
By: /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx, Chief Executive Officer
/s/ X. X. Xxxxxxx, Xx.
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X.X. Xxxxxxx, Xx., Secretary
PAYLESS CASHWAYS, INC.,
an Iowa corporation
ATTEST:
By: /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx, Chief Executive Officer
/s/ X. X. Xxxxxxx, Xx.
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X. X. Xxxxxxx, Xx., Secretary
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STATE OF MISSOURI )
) ss.
COUNTY OF XXXXXXX )
I, Xxxxxxx X. Xxxx, a Notary Public, do hereby certify that on this 26th
day of November, 1997, personally appeared before me Xxxxx Xxxxxxx, who, being
by me first duly sworn declared that he is Chief Executive Officer of PAYLESS
CASHWAYS ACQUISITION, INC., a Delaware corporation, that he signed the foregoing
document as Chief Executive Officer of the corporation, and that the statements
therein contained are true.
/s/ Xxxxxxx X. Xxxx
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Notary Public
My Commission Expires:
2/2/2000
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STATE OF MISSOURI )
) ss.
COUNTY OF XXXXXXX )
I, Xxxxxxx X. Xxxx, a Notary Public, do hereby certify that on this 26th
day of November, 1997, personally appeared before me Xxxxx Xxxxxxx, who, being
by me first duly sworn declared that he is Chief Executive Officer of PAYLESS
CASHWAYS, INC., an Iowa corporation, that he signed the foregoing document as
Chief Executive Officer of the corporation, and that the statements therein
contained are true.
/s/ Xxxxxxx X. Xxxx
----------------------------
Notary Public
My Commission Expires:
2/2/2000
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