AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (the "Agreement"), dated as of July 20,
1998, is between Scotia Pacific Holding Company, a Delaware corporation (the
"Non-Surviving Corporation"), and Scotia Pacific Company LLC, a Delaware limited
liability company ("Scotia Pacific"), (the Non-Surviving Corporation and Scotia
Pacific being collectively referred to herein as the "Constituent Entities").
PRELIMINARY STATEMENT
1. The Board of Directors of the Non-Surviving Corporation desires for such
corporation to merge with and into Scotia Pacific (the "Merger"), believes the
Merger to be desirable and in the best interests of the stockholder of the
Non-Surviving Corporation and has approved this Agreement and the Merger.
2. The Board of Managers of Scotia Pacific also believes that the Merger is
desirable and in the best interests of its member and has also approved this
Agreement and the Merger.
3. The terms, conditions and manner of consummating the Merger are set
forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual agreements,
covenants and provisions herein contained, the parties hereto agree as follows:
ARTICLE I
THE MERGER AND ITS EFFECTS
1.1 Merger Effective Time. Subject to the provisions of this Agreement, the
Constituent Entities shall duly prepare and execute a certificate of merger
setting forth the information required by, and otherwise in compliance with, the
Delaware General Corporation Law (the "DGCL") and the Delaware Limited Liability
Company Act (the "Act"), as appropriate, for filing pursuant to the Merger, and
thereafter shall have such certificate delivered for filing with the office of
the Secretary of State of the state of Delaware, on July 20, 1998 (the "Closing
Date"). Scotia Pacific has previously prepared an offering memorandum relating
to the offering of three classes of timber collateralized notes (the "Offering
Memorandum"). The Merger shall become effective for all purposes as of July 20,
1998, contemporaneously with the consummation of the other transactions
contemplated by the Offering Memorandum (the "Merger Effective Time").
1.2 Effect of the Merger. At the Merger Effective Time, by virtue of the
Merger and without any action on the part of any person, the following shall
occur:
(a) The Non-Surviving Corporation shall be merged with and into Scotia
Pacific, the separate existence of the Non-Surviving Corporation shall cease,
and Scotia Pacific shall be the surviving entity, shall continue to exist, and
shall be governed by the laws of the state of Delaware.
(b) Scotia Pacific shall thereupon and thereafter possess all the
rights, privileges, powers and franchises of a public as well as a private
nature, and be subject to all the restrictions, disabilities and duties, of each
Constituent Entity; and all and singular, the rights, privileges, power and
franchises of each Constituent Entity, and all property, real, personal and
mixed, and all debts due to either Constituent Entity on whatever account, as
well as for all other things in action or belonging to each Constituent Entity,
shall be vested in Scotia Pacific; and all property, real or personal, tangible
or intangible, rights, privileges, powers and franchises, and all and every
other interest shall be thereafter as effectually the property of Scotia Pacific
as they were of the respective Constituent Entity, and the title to any real
estate vested by deed or otherwise in either Constituent Entity shall not revert
or be in any way impaired by reason of the merger; but all rights of creditors
and all liens upon any property of either Constituent Entity shall be preserved
unimpaired, and all debts, liabilities, and duties of the respective Constituent
Entity shall thenceforth attach to Scotia Pacific and may be enforced against it
to the same extent as if said debts, liabilities and duties had been incurred or
contracted by it; and any action or proceeding whether civil, criminal or
administrative, pending by or against either Constituent Entity shall be
prosecuted as if the Merger had not taken place, or Scotia Pacific may be
substituted in such action or proceeding. Neither the rights of creditors nor
any liens upon the property of either Constituent Entity shall be impaired by
such Merger.
(c) The Agreement of Limited Liability Company of Scotia Pacific
attached hereto as Exhibit A shall become the limited liability company
agreement of Scotia Pacific upon the occurrence of the Merger Effective Time
(the "New Operating Agreement"). The New Operating Agreement shall supersede and
replace the Agreement of Limited Liability Company of Scotia Pacific dated June
10, 1998.
(d) The managers and officers of Scotia Pacific immediately prior to
the Merger Effective Time shall remain the managers and officers of Scotia
Pacific.
(e) At the Merger Effective Time, each share of capital stock of the
Non-Surviving Corporation issued and outstanding immediately prior to the Merger
Effective Time shall be canceled and retired and shall cease to exist, and each
interest in Scotia Pacific issued and outstanding immediately prior to the
Merger Effective Time shall remain issued and outstanding.
(f) From and after the Merger Effective Time, the Merger shall have
all the other effects provided by applicable law.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
OF THE CONSTITUENT ENTITIES
Each of the Constituent Entities hereby represents and warrants to the
other the following:
2.1 Formation; Qualification. It is an entity duly organized under the
state of Delaware and is validly existing and in good standing under the laws of
such state and has all requisite power and authority to own, operate or lease
its properties and to carry on its business as now being conducted.
2.2 Capitalization. All outstanding shares of capital stock or membership
interests of the Constituent Entities are duly authorized, validly issued, fully
paid and nonassessable. There are no material outstanding subscriptions, options
or other arrangements or commitments obligating the Constituent Entities to
issue any additional shares of capital stock or membership interests.
2.3 No Conflicts. Assuming this Agreement is approved by the requisite vote
of its stockholder or member as of the Closing Date and all other conditions
precedent to the Merger have been fulfilled, consummation of the transactions
contemplated hereby and compliance with the terms and provisions of this
Agreement will not materially conflict with, result in a material breach of,
require notice under or constitute a material default under any judgment, order,
injunction, decree or ruling of any court or governmental authority or under any
material agreement, indenture or instrument to which it is a party.
2.4 Authority and Authorization. It has all requisite power and authority
to enter into and perform the provisions of this Agreement. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on its part, and when
executed and delivered will constitute legal, valid and binding obligations of
each Constituent Entity, enforceable in accordance with their respective terms
and conditions except as such enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and of general principles of equity.
ARTICLE III
CONDITIONS PRECEDENT TO EACH PARTY'S
OBLIGATIONS TO EFFECT THE MERGER
The respective obligations of each party to effect the Merger shall be
subject to the fulfillment (or waiver) at or prior to the Merger Effective Time
of the following conditions:
(a) The approval and adoption of the Agreement by the sole stockholder
of the Non-Surviving Corporation and the sole member of Scotia Pacific.
(b) The absence of any order or injunction of any court or
governmental authority of competent jurisdiction preventing consummation of the
transactions contemplated hereby.
(c) Each party to this Agreement shall have performed in all material
respects their respective agreements contained in this Agreement required to be
performed at or prior to the Merger Effective Time.
ARTICLE IV
ADDITIONAL AGREEMENTS
4.1 Other Actions. As soon as reasonably practicable after the execution of
this Agreement, each of the Constituent Entities agrees to take all action
necessary to duly call, give notice of, convene and hold meetings or obtain the
requisite written consents of its stockholder or member, as applicable, to
consider and vote upon approval of the Merger and the transactions contemplated
hereby and to use all reasonable efforts to take all other action necessary or
advisable to secure any vote or consent of such stockholder or member required
by their respective organizational documents, this Agreement or applicable law
to effect the Merger.
4.2 Additional Agreements. Subject to the terms and conditions provided
herein, each of the parties hereto shall use all reasonable efforts to obtain in
a timely manner all necessary waivers, consents and approvals and to effect all
necessary registrations and filings, and to use all reasonable efforts to take,
or cause to be taken, all other actions and to do, or cause to be done, all
other things necessary, proper or advisable to consummate and make effective as
promptly as practicable the transactions contemplated by this Agreement.
ARTICLE V
TERMINATION
5.1 Termination. This Agreement may be terminated and the Merger
contemplated hereby may be abandoned at any time prior to the Merger Effective
Time by written agreement of the parties hereto.
5.2 Effect of Termination. If this Agreement is terminated as provided,
there shall be no liabilities or obligations hereunder on the part of the
parties hereto.
ARTICLE VI
MISCELLANEOUS
6.1 Further Cooperation. At, and from time to time, at the request of
another party hereto but without further consideration, each party hereto will
take all such actions and deliver all such documents as shall be reasonably
necessary or appropriate to carry out the terms and provisions of this
Agreement.
6.2 Expenses. Whether or not the Merger is effected, all costs and
expenses, including but not limited to broker, legal and accounting fees and
expenses, incurred in connection with this Agreement and the transactions
contemplated hereby shall be the responsibility of the party incurring such fees
and expenses.
6.3 Invalid Provisions. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under present or future laws effective during
the term hereof, such provision shall be fully severable; this Agreement shall
be construed and enforced as if such illegal, invalid or unenforceable provision
had never comprised a part hereof; and the remaining provisions hereof shall
remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance therefrom. Furthermore,
in lieu of such illegal, invalid or unenforceable provision, there shall be
added automatically as a part of the Agreement a provision as similar in terms
to such illegal, invalid or unenforceable provision as may be possible and be
legal, valid and enforceable.
6.4 Income Tax Treatment. For federal income tax purposes, it is intended
that the Merger be treated as a tax-free liquidation of the Non- Surviving
Corporation into its sole stockholder, The Pacific Lumber Company, pursuant to
section 332 of the Internal Revenue Code of 1986, as amended.
6.5 Entirety and Amendments. This instrument embodies the entire agreement
between the parties, and supersedes all prior agreements and understandings, if
any, relating to the subject matter hereof and may be amended only by an
instrument in writing executed by the party to be bound thereby, and
supplemented only by documents delivered in accordance with the express terms
hereof.
6.6 Headings. The headings, captions and arrangements used in this
Agreement are, unless specified otherwise, for convenience only and shall not be
deemed to limit, amplify or modify the terms of this Agreement or affect the
meaning hereof.
6.7 Governing Law. The terms and conditions of this agreement shall be
governed by and construed in accordance with the laws of the state of Delaware.
6.8 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute but one and the same instrument.
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IN WITNESS WHEREOF, this Agreement and Plan of Merger between Scotia
Pacific Holding Company and Scotia Pacific Company LLC has been duly executed
and delivered on the date first above written.
NON-SURVIVING CORPORATION:
SCOTIA PACIFIC HOLDING COMPANY
By: /s/ Xxxx X. Xx Xxx
Name: Xxxx X. Xx Xxx
Title: Vice President
SCOTIA PACIFIC:
SCOTIA PACIFIC COMPANY LLC
By: /s/ Xxxx X. Xxxxxxxx
Name: Xxxx X. Xxxxxxxx
Title: Vice President
