PLAN OF MERGER
This PLAN OF MERGER (the "Plan") is made and entered into as of the date set forth below, by and between:
AXIS AGENCY, INC., an Oregon corporation ("Axis"); and
BATES INSURANCE, INC., a Washington corporation ("Bates" or the "Surviving Corporation").
Recitals
A. Axis is a corporation organized and existing under the laws of the State of Oregon and has authorized capital stock consisting of 50,000 shares of common stock with a par value of $1.00 per share, of which 15,350.37 shares are outstanding, all held by Albert V. Axis (14,693 shares) and Thomas R. Smith (657.37 shares).
B. Bates is a corporation organized and existing under the laws of the State of Washington and has authorized capital stock consisting of 100,000 shares of common stock with no par value, out of which 60,000 shares are outstanding; those are all held by Leon A. Bates (30,000 shares) and Benjamin W. Charles (30,000 shares).
C. The Boards of Directors of Axis and Bates, respectively, deem it advisable for Axis to merge with and into Bates.
NOW, THEREFORE, in consideration of the mutual Bates and agreements contained herein, Axis and Bates hereby agree to the following Plan of Merger:
1. Names of Constituent Corporations. Axis shall merge with and into Bates. Bates shall be the Surviving Corporation.
2. Terms and Conditions of Merger. The operative date of the merger internally and for all purposes between the parties shall be March 1, 19__, despite the fact that the effective date of merger as to the third parties under corporate law shall be the date upon which the ARTICLES OF MERGER are filed with the Secretary of State. Upon the effective date of the merger:
2.1 The separate corporate existence of Axis shall cease;
2.2 Title to all real estate and other property owned by Axis and/or any partnership in which Axis is involved with Bates shall be vested in Bates without reversion or impairment;
2.3 The Surviving Corporation shall have and pay in accordance with their terms all liabilities of Axis as of the effective date of the merger; and
2.4 Any proceeding pending by or against Axis may be continued as if such merger did not occur, or the Surviving Corporation may be substituted in the proceeding for Axis.
3. Governing Law. The laws of the State of Washington shall govern this plan and the Surviving Corporation.
4. Name. The name of the Surviving Corporation shall be BATES INSURANCE, INC., subject to an anticipated name change later.
5. Registered Office. The street address of the registered office of the Surviving Corporation shall be 2121 - 12th Ave., Suite 11, Portland, OR 88020.
6. Accounting. The assets and liabilities of Axis and Bates (collectively, the "Constituent Corporations") as of the effective date of the merger shall be taken up on the books of the Surviving Corporation at the amounts at which they are carried at that time on the respective books of the Constituent Corporations.
7. Bylaws. The Bylaws of Bates as of the effective date of the merger, shall continue to constitute the Bylaws of the Surviving Corporation until the same shall be altered or amended in accordance with the provisions thereof.
8. Directors. The Board of Directors of Bates as of the effective date of the merger shall be increased in number from two to three, and Benjamin W. Charles, Leon A. Bates, and Albert V. Axis shall constitute the Directors of Surviving Corporation until their respective successors are duly elected and qualified in accordance with the Surviving Corporation's Bylaws and the SHAREHOLDERS AGREEMENT entered into between those same three individuals in conjunction with this merger.
9. Manner and Basis of Converting Shares. As of the effective date of the merger:
9.1 The 15,350.37 shares of Axis common stock outstanding with $1.00 par value per share, shall become and continue to be common shares (with no par value per share) of the Surviving Corporation.
9.2 The Surviving Corporation shall convert or exchange the 15,350.37 shares of Axis common stock, for 150,528 shares of the common stock with no par value per share of the Surviving Corporation (the number of authorized shares of which shall henceforth be increased to 300,000 by amending the Articles of Incorporation); PROVIDED, however, that no fractional shares of the Surviving Corporation stock shall be issued, and in lieu of the issuance of fractional shares, the Surviving Corporation shall make a payment in cash equal to the value of such fraction, based upon the market value of such common stock on the effective date of the merger.
9.3 On the effective date of the merger, holders of certificates of common stock in Axis shall surrender them to the Surviving Corporation, or its appointed agent, in such manner as the Surviving Corporation legally shall require. Upon receipt of such certificates, the Surviving Corporation shall issue in exchange therefor certificates of shares of common stock in the Surviving Corporation representing the number of shares of stock to which such holder shall be entitled as set forth above.
9.4 In addition, such shareholders shall be entitled to receive any dividends on such shares of common stock of the Surviving Corporation which may have been declared and paid between the effective date of the merger and the issuance to such shareholders of the certificates of such common stock.
10. Shareholder Approval. This Plan of Merger need not be submitted to the shareholders of Axis or Bates for their approval, because in accordance with RCW 23B.11.030(7) action by the shareholders of either corporation is not required, and this Plan can be adopted pursuant to RCW 23B.11.010 by the Boards of Directors of each corporation acting alone, which has in fact been done by a unanimous Consent Resolution In Lieu Of Meeting of each Board. The Articles of Merger shall be filed as required under the laws of the State of Washington.
11. Rights of Dissenting Shareholders. Any shareholder of Axis who has the right to dissent from this merger as provided in RCW 23B.13.020, and who so dissents in accordance with the requirements of RCW 23B.13.210 through RCW 23B.13.280, shall be entitled, upon surrender of the certificate(s) representing certificated shares or upon imposition of restrictions of transfer of uncertificated shares, to receive payment of the fair value of such shareholder's shares as provided pursuant to RCW 23B.13.250.
12. Termination of Merger. This merger may be abandoned at any time prior to the filing of ARTICLES OF MERGER with the Secretary of State, upon a vote of a majority of the Boards of Directors of both Axis and Bates. If the merger is terminated, there shall be no liability on the part of either Constituent Corporation, their respective Directors or shareholders.
13. Counterparts. This Plan may be executed in any number of counterparts, and all such counterparts and copies shall be and constitute an original instrument.
IN WITNESS WHEREOF, this Plan has been adopted by the undersigned
corporations effective the 1st day of March, 19__
Axis Agency, Inc.
By: ________________________
Albert V. Axis
Its: President
Bates Insurance, Inc.
By:________________________
Benjamin W. Charles
Its: President
Articles of Merger
Pursuant to the provisions of the Washington Business Corporation Act, Chapter 23B.11 RCW, the undersigned corporation hereby submits the following Articles of Merger for filing for the purpose of merging:
AXIS AGENCY, INC., an Oregon corporation ("Axis"); into
BATES INSURANCE, INC., a Washington corporation ("Bates").
Article I
The PLAN OF MERGER of Axis into Bates is attached hereto as Exhibit "A".
Article II
The merger need not be approved by the shareholders of either Axis or Bates, pursuant to the exemption therefrom as set forth RCW 23B.11.030(7); the merger has heretofore been approved by the unanimous consent of the Board of Directors of each corporation as required by RCW 23B.11.010.
DATED this __________ day of April, 19--.
BATES INSURANCE, INC.
By:________________________
Benjamin W. Charles
Its: President
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