AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF REORGANIZATION
This is AMENDMENT NO. 1 dated as of November 4, 1999 (the
"Amendment") to the AGREEMENT AND PLAN OF REORGANIZATION (the
"Agreement") dated as of July 14, 1999 by and among Eastern
Enterprises (the "Parent"), EE Acquisition Company, Inc., a New
Hampshire corporation ("Merger Sub"), and EnergyNorth, Inc., a
New Hampshire corporation (the "Company").
1. The parties entered into the Agreement to provide for a
business combination pursuant to which the Company would
merge with and into Merger Sub. On the date of this
Amendment, Parent entered into an Agreement and Plan of
Merger (the "Parent Merger Agreement") with KeySpan
Corporation, a New York corporation (the "Parent Acquiror"),
providing for a business combination (the "Parent Merger")
pursuant to which ACJ Acquisition LLC, a wholly-owned
subsidiary of Parent Acquiror and a Massachusetts limited
liability company, would merge with and into Parent, with
the Parent as the survivor of the Parent Merger. The
purpose of this Amendment is to set forth certain agreements
by and among Parent, Merger Sub and the Company to amend the
Agreement as a consequence of the execution and delivery of
the Parent Merger Agreement by Parent. Accordingly, Parent,
Merger Sub and the Company agree as set forth below in this
Amendment. Capitalized terms used in this Amendment that
are not defined herein shall have the respective meanings
ascribed to them in the Agreement. Capitalized terms used
in this Amendment that are not defined in the Agreement
shall be deemed included in the Agreement with the
respective meanings ascribed to them in this Amendment.
2. Recital A of the Agreement is hereby amended to read in its
entirety as follows:
"A. Upon the terms and subject to the conditions of this
Agreement and in accordance with the laws of the State of
New Hampshire, the Parent and the Company will enter into a
business combination transaction (the "Merger") pursuant to
which Merger Sub will merge with and into the Company with
the Company as the surviving corporation of the Merger or,
if the Parent Merger Agreement is terminated or has expired
prior to the Effective Time of the Merger, the Company will
merge with and into Merger Sub with Merger Sub as the
surviving corporation of the Merger."
3. Recital E of the Agreement is hereby amended to read in its
entirety as follows:
"E. If the Parent Merger Agreement is terminated prior to
the Effective Time, the parties intend, by executing this
Agreement, to adopt a plan of reorganization within the
meaning of Section 368 of the Internal Revenue Code of 1986,
as amended (the "Code")."
4. Article I of the Agreement is hereby amended by inserting
the following new Section 1.12:
"1.12 Alternative Merger Structure.
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(1) If the Parent Merger Agreement has not been terminated
prior to the Effective Time, then the Merger shall be
effected as provided in this Section 1.12 (the "Alternative
Merger").
(2) The following provisions shall apply to the Alternative
Merger:
(l) Section 1.1 of this Agreement shall be deemed to
read in its entirety as follows:
"1.1 The Merger. At the Effective Time (as
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defined in Section 1.2) and subject to and upon
the terms and conditions of this Agreement and the
applicable provisions of New Hampshire law, the
Merger Sub shall be merged with and into the
Company, the separate corporate existence of the
Merger Sub shall cease and the Company shall
continue as the surviving corporation. The
Company as the surviving corporation after the
Merger is hereinafter sometimes referred to as the
"Surviving Corporation."
(2) Sections 1.4(a) and (b) of this Agreement shall be
deemed to read in their entirety as follows:
"(a) At the Effective Time, the Articles of
Incorporation of the Company, as in effect
immediately prior to the Effective Time, shall be
the Articles of Incorporation of the Surviving
Corporation until thereafter amended as provided
by law and such Articles of Incorporation.
Subject to the foregoing, the additional effects
of the Merger shall be as provided in NH RSA
293-A: 11.06 (the "NHBCA").
"(b) The Bylaws of the Company, as in effect
immediately prior to the Effective Time, shall be,
at the Effective Time, the Bylaws of the Surviving
Corporation until thereafter amended."
(3) Section 1.6(a) of this Agreement shall be
deemed to read in its entirety as follows:
"(a) Conversion of Company Common Stock. Each
share of Common Stock, $1.00 par value, of the
Company (the "Company Common Stock") issued and
outstanding immediately prior to the Effective
Time (other than any shares of Company Common
Stock to be canceled pursuant to
Section 1.6(c)) will be canceled and extinguished
and automatically converted into the right to
receive $61.13 in cash, without interest (the
"Merger Consideration") at the Effective Time."
(4) Section 1.6(b) of this Agreement shall be
deemed to be deleted.
(5) Section 1.6(d) of this Agreement shall be
deemed to read in its entirety as follows:
"(d) Capital Stock of Merger Sub. Each share of
Common Stock, no par value, of Merger Sub issued
and outstanding immediately prior to the Effective
Time shall be converted into and exchanged for one
validly issued, fully paid and non assessable
share of Common Stock, $1.00 par value, of the
Surviving Corporation."
(6) Section 1.6(f) of this Agreement shall be deemed
to be deleted.
(7) Section 1.6(g) of this Agreement shall be
amended to add the following sentence at the end
thereof:
"If the Parent Merger shall have closed prior
to or simultaneously with the Effective Time,
all options to purchase Company Common Stock
then outstanding under the EnergyNorth, Inc.
1998 Stock Option Plan shall be assumed by
Parent Acquiror pursuant to Section 5.20(b)."
(8) Section 1.10 of this Agreement shall be
deemed to be deleted.
(9) The provisions of Sections 5.14, 5.17 and
5.18 of this Agreement shall not be applicable to the
Alternative Merger.
(10) Section 5.19 of this Agreement shall be
deemed to read in its entirety as follows:
"If the Effective Time occurs on a date other
than the record date for a regular quarterly
dividend on the Company Common Stock, the
Company shall, unless prohibited by law,
declare and establish a record date, set
aside funds for payment of a dividend and pay
or cause to be paid a dividend for the period
commencing on the most recent record date for
the payment of a regular quarterly dividend
by the Company on the Company Common Stock
and ending on the Effective Date (the
"Partial Period"). The amount of the
dividend (the "Partial Dividend") per share
of Company Common
Stock for the Partial Period shall equal a
fraction (x) the numerator of which equals
(a) $.35, multiplied by (b) the number of days
comprising the Partial Period and (y) the
denominator of which is 90."
(11) Section 5.20 of this Agreement shall be deemed to
read in its entirety as follows:
"5.20 Stock Options and Employee Benefits.
(1) If the Parent Merger shall not have been closed prior
to or simultaneously with the Effective Time, then at
the Effective Time each outstanding option to purchase
shares of the Company Common Stock (each a "Company Stock
Option") under the Company Stock Option Plans, whether
or not exercisable, will be assumed by Parent. Each
Company Stock Option so assumed by Parent under this
Agreement will continue to have, and be subject to, the
same terms and conditions set forth in the applicable
Company Stock Option Plan and option agreement immediately
prior to the Effective Time, except that each Company Stock
Option will be exercisable for that number of whole shares of
Parent Common Stock determined by multiplying the number
of shares of Company Common Stock subject to such Company
Stock Option by 1.175, at a purchase price per share of
Parent Common Stock determined by dividing the option
exercise price per share of Company Common Stock provided
in such Company Stock Option by 1.175. The number of
shares of Parent Common Stock that may be purchased on
the exercise of such Company Stock Option shall not include
any fractional shares but shall be rounded down to the next
lower whole share of Parent Common Stock. Parent shall take
all corporate action necessary to reserve for issuance a
sufficient number of shares of Parent Common Stock for delivery
upon exercise of options assumed by Parent pursuant to this
Section 5.20(a). As soon as practicable after the Effective
Time, Parent shall deliver to each holder of a Company Stock
Option an appropriate notice setting forth such holder's rights
pursuant hereto. Any Company Stock Options assumed by the
Parent pursuant to this Section 5.20(a) shall be treated in
the same manner as other "Company Stock Options" (as defined
in the Parent Merger Agreement) under Section 7.10 of the
Parent Merger Agreement.
(2) If the Parent Merger shall have been closed prior to or
simultaneously with the Effective Time, then at the Effective
Time, each outstanding Company Stock Option under the Company
Stock Option Plans, whether or not exercisable, will be assumed
by Parent Acquiror. Each Company Stock Option so assumed by
Parent Acquiror under this Agreement will continue to have and be
subject to, the same terms and conditions set forth in the
applicable Company Stock Option Plan and option agreement
immediately prior to the Effective Time, except that each Company
Stock Option will be exercisable for that number of whole shares
of Parent Acquiror common stock determined by multiplying the
number of shares of Company Common Stock subject to such Company
Stock Option by a fraction the numerator of which is the product
of (x) 1.175 times (y) $64.00 and the denominator of which is the
average closing price per share of Parent Acquiror's common stock
on the NYSE, as report in The Wall Street Journal, for the 10
NYSE trading days immediately preceding the Effective Time, at a
purchase price per share of common stock of Parent Acquiror
determined by dividing the quotient of (I) such option exercise
price per share of Company Common Stock provided in such Company
Stock Option and (II) 1.175 by the quotient of (x) $64.00 and (y)
the average closing price per share of Parent Acquiror's common
stock on NYSE, as reported in The Wall Street Journal, for the 10
NYSE trading days immediately preceding the Effective Time. The
number of shares of Parent Acquiror common stock that may be
purchased on the exercise of such Company Stock Option shall not
include any fractional shares but shall be rounded down to the
next lower whole share of Parent Acquiror common stock. Parent
Acquiror shall take all corporate action necessary to reserve for
issuance a sufficient number of shares of Parent Acquiror common
stock for delivery upon exercise of options assumed by Parent
Acquiror pursuant to this Section 5.20(b). As soon as
practicable after the Effective Time, Parent Acquiror shall
deliver to each holder of a Company Stock Option an appropriate
notice setting forth such holder's rights pursuant hereto.
(3) It is intended that the Company Stock Options assumed by
Parent under Section 5.20(a) or the Parent Acquiror under Section
5.20(b) shall qualify following the Effective Time as incentive
stock options as defined in Section 422 of the Code to the extent
the Company Stock Options qualified as incentive stock options
immediately prior to the Effective Time. The provisions of this
Section 5.20 shall be applied consistent with such intent.
(4) (i) Parent agrees to file a registration statement on Form S-8
for the shares of Parent Common Stock issuable with respect to
assumed Company Stock Options, and (ii) Parent Acquiror agrees to
file a registration statement on Form S-8 for the shares of
Parent Acquiror common stock issuable with respect to assumed
Company Stock Options, in each case within 10 business days after
the Effective Time, and to use its reasonable efforts to maintain
the effectiveness of such registration statement thereafter for
so long as any of such options or other rights remain
outstanding."
(12) The conditions set forth in Section 6.1(f)
and 6.2(c) of this Agreement shall not be applicable to
the Alternative Merger.
(13) All references in this Agreement to the Surviving
Corporation shall be deemed references to the Company
as the Surviving Corporation in the Alternative Merger.
(14) All references in this Agreement to the
Merger shall be deemed references to the Alternative
Merger as provided in this Section 1.12.
(15) All other provisions of this Agreement shall
be deemed amended as appropriate to reflect that the
Alternative Merger is being effected as the Merger so
that, among other things, neither the Company nor the
Parent shall be deemed to have breached its
representations, warranties or covenants set forth in
this Agreement solely by reason of effecting the
Alternative Merger".
5. Section 8.11 of the Agreement is hereby amended to read in
its entirety as follows:
"8.11 Assignment. Except as hereinafter set forth, no
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party may assign either this Agreement or any of its rights,
interests or obligations hereunder without the prior written
approval of the other parties. Upon the closing of the
Parent Merger, the Parent Acquiror agrees to cause Parent to
consummate the Alternative Merger in accordance with the
terms and conditions of this Agreement and in such event the
Parent Acquiror will be a third party beneficiary of this
Agreement."
6. Parent shall not agree to any amendment or modification of
Section 7.10 of the Parent Merger Agreement which adversely
affects holders of Company Stock Options (including the
rights that they would have as holders of options to
purchase Parent Common Stock upon the effectuation of
Section 5.20(a) of the Agreement at the Effective Time)
without the Company's prior written consent. If the per
share merger consideration set forth in
the Parent Merger Agreement (the "Parent Merger Consideration")
or any amendment or modification thereof is increased for any
reason above $64.00 (including any increase in the "Merger
Consideration" in the Parent Merger Agreement pursuant to
the last sentence of Section 2.01(c) of the Parent Merger
Agreement and disregarding for this purpose the reduction
set forth in the proviso at the end of such sentence), (i)
the amounts set forth in Paragraph 4 of this Amendment with
reference to Section 1.12(b)(iii) of the Agreement (which
amends Section 1.6(a) of the Agreement) will be increased by
an amount equal to (x) the per share amount of the increase
in the Parent Merger Consideration times (y) 0.589 and (ii)
the amounts set forth in Paragraph 4 of this Amendment with
reference to the $64.00 amounts in Section 1.12(b)(xi) of
the Agreement (which adds new Section 5.20(b) of the
Agreement) will be increased by the full amount of the per
share increase in the Parent Merger Consideration.
7. Section 5.20(a) of the Agreement shall be amended to delete
the parenthetical contained in the second sentence thereof.
8. All per share amounts in this Amendment and the exchange
ratios set forth herein of 1.175 and .589 shall be subject
to appropriate adjustment in the case of stock splits, stock
dividends or other similar events affecting the common stock
of the Company, Parent or the Parent Acquiror, as
applicable.
9. Section 7.1(b) of this Agreement shall be amended to provide
for the substitution of the dates March 31, 2001 and
September 30, 2001 for July 14, 2000 and January 14, 2001,
respectively. If the dates set forth in Section 9.01(b) of
the Parent Merger Agreement are extended, Parent shall
promptly notify the Company and the Company shall have the
option of either (x) extending the dates set forth in
Section 7.1(b) of the Agreement to be coterminous with the
analogous dates in Section 9.01(b) of the Parent Merger
Agreement (as so extended) or (y) terminating the Agreement
pursuant to Section 7.1(b) of the Agreement.
10.If the Parent Merger Agreement has not been terminated prior
to the Effective Time, Section 1.2 of this Agreement shall
be amended (x) to provide for the substitution of the words
"the second business day" for the words "the thirty-fifth
day" in the third sentence thereof, and (y) to add "but in
no event sooner than simultaneously with the Closing
provided for in the Parent Merger Agreement" immediately
after the second parenthetical thereof.
11.The parties acknowledge that the reference to "Company
Plans" contained in Section 4.2(f) of the Agreement means
"Company Stock Plans".
12.Parent and Parent Acquiror represent that they have
presented the Company with a true copy of the Parent Merger
Agreement in connection with the execution of this
Amendment.
IN WITNESS WHEREOF, Eastern Enterprises, EE Acquisition
Company, Inc. and EnergyNorth, Inc. have caused this Amendment to
be signed as a sealed instrument by their duly authorized
respective officers, all as of the date first written above.
EASTERN ENTERPRISES
By:/s/ X. Xxxxxx Xxxx
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Chairman and Chief Executive
Officer
EE ACQUISITION COMPANY, INC.
By:/s/ Xxxxxx X. Xxxxxxxx
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President
ENERGYNORTH, INC.
By:/s/ Xxxxxx X. Xxxxxxxx
--------------------------------------
President and Chief Executive Officer
The undersigned agrees to its obligations set forth in
Sections 5.20 and 8.11 of the Agreement.
KEYSPAN CORPORATION
By:/s/ Xxxxxx X. Xxxxxx
--------------------------------------
Chairman and Chief Executive Officer
