EXHIBIT 2
CONFORMED COPY
AGREEMENT OF MERGER
AGREEMENT OF MERGER (this "Merger Agreement") made and entered into this
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26th day of February, 1997 by and between LESLIE'S POOLMART a California
corporation ("Leslie's California"), and LPM HOLDINGS, INC., a Delaware
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corporation ("Leslie's Delaware");
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WITNESSETH:
WHEREAS, Leslie's Delaware is a corporation duly organized and existing
under the laws of the State of Delaware;
WHEREAS, Leslie's California is a corporation duly organized and existing
under the laws of the State of California;
WHEREAS, on the date of this Merger Agreement, Leslie's Delaware has
authority to issue 5,000,000 shares of Common Stock, par value $.001 per share
(which class of shares is herein called the "Delaware Common Stock") of which
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10,000 shares are issued and outstanding and owned by Leslie's California, and
2,000,000 shares of Preferred Stock, par value $.001 per share, of which no
shares are issued and outstanding; and prior to the Effective Date, the
authorized number of shares of Delaware Common Stock will be increased to
12,000,000;
WHEREAS, on the date of this Merger Agreement, Leslie's California has
authority to issue 40,000,000 shares of Common Stock, (the "California Common
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Stock") of which 6,550,966 shares are issued and outstanding, and 1,000,000
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shares of Preferred Stock, of which no shares are issued and outstanding;
WHEREAS, the respective boards of directors of Leslie's Delaware and
Leslie's California have determined that, for the purpose of effecting the
reincorporation of Leslie's California in the State of Delaware, it is advisable
and to the advantage of said two corporations and their shareholders and sole
stockholder, respectively, that Leslie's California merge with and into Leslie's
Delaware upon the terms and conditions herein provided; and
WHEREAS, the respective boards of directors of Leslie's Delaware and
Leslie's California have approved this Merger Agreement and the board of
directors of Leslie's California and Leslie's Delaware have directed that this
Merger Agreement be submitted to a vote of their shareholders and sole
stockholder, respectively;
NOW, THEREFORE, in consideration of the mutual agreements and covenants set
forth herein, Leslie's California and Leslie's Delaware hereby agree to merge as
follows:
(1) Merger. Leslie's California shall be merged with and into
Leslie's Delaware, and Leslie's Delaware shall survive the merger
("Merger"), effective upon the date when this Merger Agreement is made
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effective in accordance with applicable law (the "Effective Date").
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(2) Directors and Officers and Governing Documents. The directors
and officers of Leslie's Delaware shall be the same upon the Effective Date
as they are immediately prior thereto. The certificate of incorporation of
Leslie's Delaware, as amended and in effect on the Effective Date, shall
continue to be the certificate of incorporation of Leslie's Delaware as the
surviving corporation without change or amendment until further amended in
accordance with the provisions thereof and applicable laws, except that on
the Effective Date Article I of said certificate of incorporation shall be
amended to read in its entirety as follows: "The name of this Corporation
shall be: Leslie's Poolmart, Inc." The bylaws of Leslie's Delaware, as
amended and in effect on the Effective Date, shall continue to be the
bylaws of Leslie's Delaware as the surviving corporation without change or
amendment until further amended in accordance with the provisions thereof
and applicable laws.
(3) Succession. On the Effective Date, Leslie's Delaware shall
succeed to Leslie's California in the manner of and as more fully set forth
in Section 259 of the General Corporation Law of the State of Delaware and
Section 1107 of the General Corporation Law of the State of California.
(4) Further Assurances. From time to time, as and when required by
Leslie's Delaware or by its successors and assigns, there shall be executed
and delivered on behalf of Leslie's California 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 Leslie's Delaware the
title to and possession of all the property, interests, assets, rights,
privileges, immunities, powers, franchises and authority of Leslie's
California, and otherwise to carry out the purposes of this Merger
Agreement, and the officers and directors of Leslie's Delaware are fully
authorized in the name and on behalf of Leslie's California or otherwise to
take any and all such action and to execute and deliver any and all such
deeds and other instruments.
(5) Common Stock of Leslie's California. Upon the Effective Date,
by virtue of the Merger and without any action on the part of the holder
thereof, each share of the California Common Stock outstanding immediately
prior thereto shall be changed and converted into one fully paid and
nonassessable share of Delaware Common Stock.
(6) Stock Certificates. On and after the Effective Date, all of the
outstanding certificates which prior to that time represented shares of
California Common Stock shall for all purposes evidence ownership of and
represent the shares of Delaware Common Stock into which the shares of
California Common Stock represented by such certificates have been
converted as herein provided. The registered owner on the books and records
of Leslie's Delaware or its transfer agent of any such outstanding stock
certificate shall, until such certificate shall have been surrendered for
transfer or otherwise accounted for to Leslie's Delaware or its transfer
agent, have and be entitled to exercise any voting and other rights with
respect to and to receive any dividend and other distributions upon the
shares of Delaware Common Stock evidenced by such outstanding certificate
as above provided.
(7) Stock Options. Forthwith upon the Effective Date, each (i)
outstanding option to purchase shares of California Common Stock granted
under the Leslie's California 1990 Stock Option Plan and the Leslie's
California 1992 Directors' Stock Incentive Plan (collectively, the "Plans")
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and (ii) outstanding option to purchase California Common Stock not granted
under the Plans, shall be converted into and become an option
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to purchase the same number of shares of Delaware Common Stock at the same
option price per share as in effect on the Effective Date and, in the case
of options granted under the Plans (collectively, the "Plan Options"), upon
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the same terms and subject to the same conditions as set forth in the
Plans, and, in the case of all options not granted under the Plans
(collectively, the "Non-Plan Options"), upon the same terms and subject to
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the same conditions as set forth in the agreements or instruments that
govern the Non-Plan Options. A number of shares of Delaware Common Stock
shall be reserved for purposes of the Plans equal to the number of shares
of California Common Stock so reserved as of the Effective Date. As of the
Effective Date, Leslie's Delaware hereby assumes all obligations of
Leslie's California under the Plans, the outstanding Plan Options or
portions thereof granted pursuant to the Plans and all Non-Plan Options.
(8) Other Employee Benefit Plans. As of the Effective Date, Leslie's
Delaware hereby assumes all obligations of Leslie's California 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.
(9) Common Stock of Leslie's Delaware. Forthwith upon the Effective
Date, the 10,000 shares of Delaware Common Stock presently issued and
outstanding in the name of Leslie's California shall be cancelled and
retired and resume the status of authorized and unissued shares of Delaware
Common Stock, and no shares of Delaware Common Stock or other securities of
Leslie's Delaware shall be issued in respect thereof.
(10) Covenants of Leslie's Delaware. Leslie's Delaware covenants and
agrees that it will, on or before the Effective Date:
(a) Qualify to do business as a foreign corporation in the State
of California, and in connection therewith irrevocably appoint an
agent for service of process as required under the provisions of
Section 2105 of the California Corporations Code.
(b) File any and all documents with the California Franchise Tax
Board necessary to the assumption by Leslie's Delaware of all of the
franchise tax liabilities of Leslie's California.
(11) Book Entries. As of the Effective Date, entries shall be made
upon the books of Leslie's Delaware in accordance with the following:
(a) The assets and liabilities of Leslie's California shall be
recorded at the amounts at which they were carried on the books of
Leslie's California immediately prior to the Effective Date, with
appropriate adjustments to reflect the retirement of the 10,000 shares
of Delaware Common Stock presently issued and outstanding.
(b) There shall be credited to the common stock account of
Leslie's Delaware the aggregate amount of the par value of all shares
of Delaware Common Stock resulting from the conversion of the
outstanding California Common Stock pursuant to the Merger.
(c) There shall be credited to the capital surplus account of
Leslie's Delaware the aggregate of the amounts shown in the common
stock and capital
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surplus accounts of Leslie's California immediately prior to the
Effective Date, less the amount credited to the common stock account
of Leslie's Delaware pursuant to Paragraph (b) above.
(d) There shall be credited to the retained earnings account of
Leslie's Delaware an amount equal to that carried in the retained
earnings account of Leslie's California immediately prior to the
Effective Date.
(12) Amendment. At any time before or after approval and adoption by
the shareholders of Leslie's California, this Merger Agreement may be
amended in any manner (except that Paragraph (5) may not be amended without
the approval of the shareholders of Leslie's California), as may be
determined in the judgment of the respective boards of directors of
Leslie's Delaware and Leslie's California to be necessary, desirable or
expedient in order to clarify the intention of the parties hereto or to
effect or facilitate the purposes and intent of this Merger Agreement.
(13) Abandonment. At any time before the Effective Date, this Merger
Agreement may be terminated and the Merger may be abandoned by the board of
directors of either Leslie's California or Leslie's Delaware with the
approval of the board of directors of the other corporation,
notwithstanding approval of this Merger Agreement by the stockholders of
Leslie's Delaware or the shareholders of Leslie's California or both.
(14) 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.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, this Merger Agreement, having first been duly
approved by resolution of the boards of directors of Leslie's California and
Leslie's Delaware, is hereby executed on behalf of each said two corporations
by their respective officers thereunto duly authorized.
LPM HOLDINGS, INC.,
a Delaware corporation
By:/s/ XXXXX X. XXXXXXXXX
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Xxxxx X. XxXxxxxxx,
President
By:/s/ XXXXXX X. XXXXX
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Xxxxxx X. Xxxxx,
Secretary
LESLIE'S POOLMART
a California corporation
By:/s/ XXXXX X. XXXXXXXXX
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Xxxxx X. XxXxxxxxx,
President and Chief
Executive Officer
By:/s/ XXXXXXX X. XXXXX
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Xxxxxxx X. Xxxxx,
Secretary
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CERTIFICATE OF THE SECRETARY OF LPM HOLDINGS, INC.
I, Xxxxxx X. Xxxxx, Secretary of LPM HOLDINGS, INC., a Delaware
corporation, ("Leslie's Delaware"), do hereby certify, as such Secretary, in
accordance with the General Corporation Law of the State of Delaware, that the
Agreement of Merger to which this Certificate is attached, after having been
first duly adopted and executed by Leslie's Delaware and Leslie's Poolmart, a
California corporation, was duly submitted to the sole stockholder of Leslie's
Delaware at a special meeting of stockholders called for the purpose of acting
on said Agreement of Merger, notice of the time, place and purpose of said
meeting having been waived by the sole stockholder of Leslie's Delaware, and
that at said meeting the Agreement of Merger was considered and a vote taken for
its adoption or rejection and that at said meeting all of the outstanding stock
of Leslie's Delaware entitled to vote thereon was voted for the adoption of said
Agreement of Merger and that thereby said Agreement of Merger was at said
meeting duly adopted as the act of the stockholders of Leslie's Delaware and as
the agreement and act of Leslie's Delaware.
IN WITNESS WHEREOF, the undersigned has executed this certificate this
______ day of ___________________, 1997.
________________________________
Xxxxxx X. Xxxxx,
Secretary
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CERTIFICATE OF THE SECRETARY OF LESLIE'S POOLMART
I, Xxxxxxx X. Xxxxx, Secretary of LESLIE'S POOLMART, a California
corporation ("Leslie's California"), do hereby certify, as such Secretary, in
accordance with the General Corporation Law of the State of Delaware, that the
Agreement of Merger to which this Certificate is attached, after having been
first duly adopted and executed by Leslie's California and LPM Holdings, Inc., a
Delaware corporation, was duly submitted to the shareholders at a meeting of
shareholders called for the purpose of acting on said Agreement of Merger after
due notice of the time, place and purpose of said meeting was mailed to each
holder of Common Stock of Leslie's California at his, her or its address as it
appears on the records of Leslie's California in the manner provided under the
provisions of Section 601 of the California Corporations Code and that at said
meeting the Agreement of Merger was considered and a vote taken for its adoption
or rejection and that at said meeting a majority of the outstanding Common Stock
of Leslie's California entitled to vote thereon was voted for the adoption of
said Agreement of Merger and that thereby said Agreement of Merger was at said
meeting duly adopted as the act of the shareholders of Leslie's California and
as the agreement and act of Leslie's California.
IN WITNESS WHEREOF, the undersigned has executed this certificate this
_____ day of ______________________, 1997.
________________________________
Xxxxxxx X. Xxxxx,
Secretary
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