EXHIBIT 2.1(a)
AMENDMENT NO. 1 TO
AGREEMENT AND PLAN OF REORGANIZATION
THIS AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF REORGANIZATION (this
"Amendment") is made and entered into this 3rd day of October, 1996, by and
between ATMOS ENERGY CORPORATION, a Texas corporation ("Atmos"), and UNITED
CITIES GAS COMPANY, an Illinois and Virginia corporation ("United Cities").
WHEREAS, Atmos and United Cities have entered into that certain Agreement
and Plan of Reorganization dated July 19, 1996 (the "Reorganization Agreement");
and
WHEREAS, Atmos and United Cities desire to amend the Reorganization
Agreement in certain respects.
NOW, THEREFORE, for and in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
1. Definitions. All capitalized terms used and not otherwise defined
-----------
herein shall have the meanings given such terms in the Reorganization Agreement.
2. Amendment of Section 1.26. Section 1.26 of the Reorganization
-------------------------
Agreement is hereby amended to read in its entirety as follows:
"Section 1.26 Opinion of Financial Advisor. United Cities has
------------- ----------------------------
received the opinion of PaineWebber Incorporated, dated the date hereof, to
the effect that, as of the date hereof, the exchange ratio set forth in the
Plan of Merger is fair to the holders of United Cities Stock from a
financial point of view."
3. Amendment of Section 2.26. Section 2.26 of the Reorganization
-------------------------
Agreement is hereby amended to read in its entirety as follows:
"Section 2.26. Opinion of Financial Advisor. Atmos has received the
------------ ----------------------------
opinion of ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, dated the
date hereof, to the effect that, as of the date hereof, the exchange ratio
set forth in the Plan of Merger is fair to Atmos from a financial point of
view."
4. Amendment of Section 3.13. Section 3.13 of the Reorganization
-------------------------
Agreement is hereby amended to read in its entirety as follows:
"Section 3.13 Termination of Supplemental Executive Retirement Plan.
------------ -----------------------------------------------------
Prior to Closing, United Cities shall have (a) terminated the United Cities
and Subsidiaries Supplemental Executive Retirement Plan and all
accompanying Joinder Agreements and (b) obtained waivers and releases from
all "active participants" (as defined in such Plan), with respect to any
and all rights and benefits to which they were entitled thereunder. In
consideration for such
waivers and releases, United Cities shall pay to each such participant an
amount equal to one dollar less than three hundred percent (300%) of the
average of such participant's compensation paid by United Cities and
included in his or her gross income for Federal income tax purposes for the
five (5)-year period ending on the December 31 immediately preceding the
Closing Date; provided that, the aggregate of all such payments shall not
exceed $5,100,000. Notwithstanding the preceding provisions of this
Section 3.13, ▇▇. ▇▇▇▇ ▇▇▇▇▇▇ shall, prior to the Closing Date, be given
the option to (i) provide a waiver and release with respect to his rights
and benefits under the United Cities Gas and Subsidiaries Supplemental
Executive Retirement Plan, in which event he shall participate in the Atmos
Supplemental Executive Benefits Plan or (ii) continue to be entitled to his
rights and benefits under the United Cities Gas and Subsidiaries
Supplemental Executive Retirement Plan and not be entitled to participate
in the Atmos Supplemental Executive Benefits Plan."
5. Amendment of Section 4.7. Section 4.7 of the Reorganization Agreement
-------------------------
is hereby amended to add a new subsection (f), which shall read in its
entirety as follows:
"(f) Nothing in this Section 4.7 or elsewhere in this Agreement is
intended to, or shall be interpreted to, limit any rights of any employees of
any United Cities Entity, or any obligation of the United Cities Entities or
Atmos pursuant to any collective bargaining agreement or the National Labor
Relations Act; it being expressly understood by the parties that any employees
of any United Cities Entities subject to any collective bargaining agreement
shall be entitled to the rights provided to such employees by this Section 4.7
to the extent permitted by the National Labor Relations Act."
6. Amendment of Section 5.1(a). Section 5.1(a) of the Reorganization
---------------------------
Agreement is hereby amended to read in its entirety as follows:
"(a) Subject to the terms and conditions of this Agreement, Atmos and
United Cities agree to enter into a statutory merger under the applicable
laws of the States of Texas, Illinois and Virginia whereby United Cities
will be merged with and into Atmos, with Atmos as the surviving corporation
(the "Merger"); and Atmos and United Cities hereby respectively agree that
the terms and conditions of such Merger, the mode of carrying the same into
effect, the manner of converting the shares of capital stock of United
Cities into shares of Atmos Stock, and other necessary or proper details
and provisions relating to such Merger shall be as contained in the form of
Plan of Merger attached hereto as Exhibit D (the "Plan of Merger").
Notwithstanding anything to the contrary contained in this Agreement or the
Plan of Merger, if any state authority or commission requires that the
survivor pursuant to the Merger be a corporation incorporated under the
laws of such state, each party agrees to take all necessary actions to
comply with such requirement and provide that such survivor will be
incorporated in such state, including, without limitation, making any
necessary amendments to the Plan of Merger, as authorized by the respective
Board of Directors of United Cities and Atmos by approval of this
Agreement."
7. Amendment of Section 5.1 (d). Section 5.1(d) of the Reorganization
----------------------------
Agreement is hereby amended to read in its entirety as follows:
"(d) The "Paying Agent" referred to in the Plan of Merger shall be
The First National Bank of Boston or such party as Atmos and United Cities
may mutually agree."
-2-
8. Amendment of Section 5.2. Section 5.2 of the Reorganization Agreement
------------------------
is hereby amended to read in its entirety as follows:
"Section 5.2 Execution, Filing, and Recording of Merger Documents.
----------- ----------------------------------------------------
Subject to the terms and conditions of this Agreement and upon approval and
adoption of the Plan of Merger by the respective shareholders of United
Cities and Atmos in accordance with the laws of Texas, Illinois and
Virginia, as applicable, relating to statutory mergers, Atmos and United
Cities each agree to properly execute and deliver the Plan of Merger in
compliance with the laws of Texas, Illinois and Virginia, as well as the
requisite certificate(s) and articles of merger in compliance with the laws
of Texas, Illinois and Virginia, as applicable, and to cause the requisite
filing and recording of the certificate(s) and articles of merger in
accordance with the laws of the States of Texas, Illinois and Virginia, as
applicable, all with a view of making the Merger effective at, or as soon
as possible after, the Closing Date. The officers of United Cities and
Atmos that are responsible for the execution of the articles of merger may
determine a specific date for the Effective Time not later than fifteen
(15) days after the filing of all necessary articles of merger in the
States of Texas, Illinois and Virginia in lieu of the Effective Time
specified in the Plan of Merger and such officers may amend Section 3.01 of
the Plan of Merger accordingly."
9. Amendment of Section 6.1(c). Section 6.1(c) of the Reorganization
---------------------------
Agreement is hereby amended to read in its entirety as follows:
"(c) FERC and Utility Commission Approvals. All necessary
-------------------------------------
approvals of the Federal Energy Regulatory Commission and the state
public utility commissions for which approval is required shall have
been granted by final order and all applicable appeal and waiting
periods shall have expired and such orders shall not contain any
condition which, in the reasonable judgment of Atmos, would result in
a material adverse change in the business, operations, properties,
condition (financial or otherwise), assets or liabilities of the
United Cities Entities, taken as a whole, or the Atmos Entities, taken
as a whole."
10. Amendment of Section 6.1(g). Section 6.1(g) of the Reorganization
---------------------------
Agreement is hereby amended to read in its entirety as follows:
"(g) Pooling Letter. Atmos shall have received from Ernst &
--------------
Young LLP a written opinion dated the Closing Date, in form and
substance satisfactory to Atmos, stating that Ernst & Young LLP
concurs in the accounting treatment of the Merger as a pooling of
interests."
-3-
11. Amendment of Section 6.2(d). Section 6.2(d) of the Reorganization
---------------------------
Agreement is hereby amended to read in its entirety as follows:
"(d) Opinion of Financial Advisor. The Board of Directors of
----------------------------
Atmos shall have received from ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated a written opinion, dated as of the mailing date of the
Proxy Statement/Prospectus, in form and substance satisfactory to
Atmos, to the effect that the exchange ratio of shares of Atmos Stock
for shares of United Cities Stock in the Merger is fair to Atmos from
a financial point of view."
12. Amendment of Section 6.3(d). Section 6.3(d) of the Reorganization
---------------------------
Agreement is hereby amended to read in its entirety as follows:
(d) Opinion of Financial Advisor. The Board of Directors of
----------------------------
United Cities shall have received from PaineWebber Incorporated a
written opinion, dated as of the mailing date of the Proxy
Statement/Prospectus, in form and substance satisfactory to United
Cities, to the effect that the exchange ratio of shares of Atmos Stock
for shares of United Cities Stock in the exchange ratio is fair to the
shareholders of United Cities from a financial point of view."
13. Amendment of Section 7.1(j). Section 7.1(j) of the Reorganization
---------------------------
Agreement is hereby amended to read in its entirety as follows:
"(j) by Atmos, prior to the expiration of twenty (20) days from
and after a period of forty (40) days from the date of this Agreement,
in its sole discretion, in the event United Cities fails to terminate
all liabilities of United Cities under the United Cities and
Subsidiaries Supplemental Executive Retirement Plan for an aggregate
amount of not more than $5,100,000; or"
14. Amendment of Plan of Merger. The Plan of Merger is hereby amended to
---------------------------
read in its entirety as Exhibit A attached hereto.
15. No Other Amendment. Except as expressly amended hereby, all of the
------------------
other terms, provisions and conditions of the Reorganization Agreement are
hereby ratified and confirmed and shall remain unchanged and in full force and
effect. To the extent any terms or provisions of this Amendment conflict with
those of the Reorganization Agreement, the terms and provisions of this
Amendment shall control. This Amendment shall be deemed a part of, and is
hereby incorporated into, the Reorganization Agreement. The Reorganization
Agreement and any and all other documents heretofore, now or hereafter executed
and delivered pursuant to the terms of the Reorganization Agreement are hereby
amended so that any reference to the Reorganization Agreement shall mean a
reference to the Reorganization Agreement as amended hereby.
-4-
16. Governing Law. This Amendment shall be governed by, and construed in
-------------
accordance with, the laws of the State of Texas.
17. Counterparts. This Amendment may be executed in counterparts, each of
------------
which will be an original, but all of which together will constitute one and the
same agreement.
IN WITNESS WHEREOF, Atmos and United Cities have executed this Amendment on
the date first written above by their respective officers thereunto duly
authorized.
ATMOS ENERGY CORPORATION
By: /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
President and Chief Operating Officer
UNITED CITIES GAS COMPANY
By: /s/▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
-5-
