AGREEMENT AND PLAN OF MERGER (Merger Sub)
Exhibit
10.7
AGREEMENT AND PLAN OF MERGER
(Merger Sub)
This Agreement and Plan of Merger, dated as of , 2005 (this
“Agreement”), is entered into by and among , a Delaware limited liability
company (“Merger Sub”) and wholly-owned subsidiary of Ensource Energy Income Fund LP, a
Delaware limited partnership (the “Partnership”), and Eastern American Natural Gas Trust, a
Delaware statutory trust (“NGT”). In this Agreement, each of the Partnership and NGT is
individually referred to as a “Party,” and those entities are collectively referred to as
the “Parties.”
W I T N E S S E T H:
WHEREAS, the Partnership, through Ensource Energy Partners, LP, a Delaware limited partnership
and the Partnership’s sole general partner (the “General Partner”), has implemented a plan
to acquire directly or indirectly NGT (the “Acquisition Plan”), and in furtherance of such
Acquisition Plan, has effected an exchange offer pursuant to a registration statement on Form S-4
filed with the Securities and Exchange Commission (Commission File No. 333-126068) pursuant to
which the Partnership has offered to exchange depositary units of NGT for common units of the
Partnership on a one for one basis (the “Exchange Offer”); and
WHEREAS, as a result of the Exchange Offer, the Partnership has accepted for exchange, and
owns, a total of ___depositary units representing more than 50% of the outstanding trust units
of NGT, and in furtherance of the Acquisition Plan and in accordance with that certain Second
Amended and Restated Trust Agreement of Eastern American Natural Gas Trust, dated January 1, 1993,
by and among Eastern American Energy Corporation, JPMorgan Chase Bank, as successor-in-interest to
Bank of Montreal Trust Company and trustee (the “Trustee”), and Wilmington Trust Company
(the “Trust Agreement”), the Partnership intends to effect the merger of the Merger Sub
with and into NGT, with NGT continuing as the surviving entity of such merger in accordance with
the terms and conditions set forth in this Agreement; and
WHEREAS, the General Partner on behalf of the Partnership, as the parent of Merger Sub, deems
it advisable and in the best interest of Merger Sub to effect the contemplated merger, and in
connection therewith the General Partner on behalf of the Partnership has authorized, approved and
adopted this Agreement; and
WHEREAS, the Partnership, being a trust unitholder of NGT qualified to call a special meeting
of trust unitholders, has exercised its rights under the Trust Agreement to call a special meeting
of trust unitholders of NGT for the purpose of approving and adopting this Agreement and the
transactions contemplated herein and to effect the Merger (as defined below); and
WHEREAS, the Trust Agreement requires a vote of at least 50% of all trust units of NGT in
favor of the Merger (as defined below); and
WHEREAS, the Partnership holds more than 50% of all trust units of NGT, has agreed to vote in
favor of the Merger (as defined below) and, therefore, does not intend to solicit proxies from the
other holders of NGT trust units; and
WHEREAS, NGT and the Partnership intend to prepare and provide to the other holders of NGT
trust units a definitive information statement relating to the Merger (as defined below); and
WHEREAS, the Trustee has approved and adopted this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the respective representations,
warranties, covenants and agreements herein contained, and intending to be legally bound, the
Parties hereby agree as follows:
ARTICLE I. THE MERGER
Section 1.1. The Merger. Upon the terms and subject to the conditions
contained in this Agreement, and in accordance with Section 18-209 of the Delaware Limited
Liability Company Act (the “DLLCA”) and Section 3815 of the Delaware Statutory Trust Act
(the “DSTA”), Merger Sub shall be merged with and into NGT (the “Merger”) at the
Effective Time (as defined in Section 1.3 of this Agreement). At the Effective Time, the
separate limited liability company existence of Merger Sub shall cease and NGT shall continue its
existence as the surviving entity (the “Surviving Entity”).
Section 1.2. Closing. Subject to the satisfaction or waiver of the conditions
to closing set forth in Article III of this Agreement, the consummation of the Merger shall
occur as close in time as possible to, but in no case later than the same day (which shall be a day
upon which the Office of the Secretary of State of the State of Delaware is open for business) as,
the special meeting of NGT trust unitholders at which the Agreement and the transactions
contemplated herein are properly approved and adopted. The consummation of the Merger shall be
effected through a closing held at the offices of Xxxxxxx Xxxxx LLP, 000 Xxxxxxxxx Xxx.,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, unless another place is agreed upon by the
Parties.
Section 1.3. Effective Time. As soon as practicable after the conditions to
closing set forth in Article III of this Agreement have been satisfied or waived, the
Parties shall (A) file a certificate of merger in the form attached as Annex A to this
Agreement (the “Certificate of Merger”) with the Secretary of State of the State of
Delaware in accordance with Section 18-209(c) of the DLLCA and Section 3815(b) of the DSTA and (B)
make all other filings or recordings, if any, as shall be required to consummate the Merger under
applicable laws. The Merger shall become effective upon the filing of the Certificate of Merger
with the Secretary of State of the State of Delaware (the date and time of such filing, the
“Effective Time”).
Section 1.4. Effects of the Merger. At and after the Effective Time, the
Merger will have the effects set forth in the DLLCA, DSTA and this Agreement. Without limiting the
generality of the foregoing, and subject thereto, at the Effective Time, all the property
(including, without limitation, all rights, privileges, powers and franchises of the Merger Sub
shall be vested in the Surviving Entity, and all debts, liabilities and duties of the Merger Sub
shall become the debts, liabilities and duties of the Surviving Entity.
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Section 1.5. Certificate of NGT. At and after the Effective Time, the
certificate of trust of NGT, as in effect immediately prior to the Effective Time, shall be the
certificate of trust of the Surviving Entity unless and until thereafter amended in accordance with
the terms thereof and applicable laws.
Section 1.6. Trust Agreement. At and after the Effective Time, the Trust
Agreement, as in effect immediately prior to the Effective Time shall be amended and restated in
its entirety to be as set forth in Annex B attached hereto, which amended and restated
Trust Agreement shall be the Trust Agreement of the Surviving Entity unless and until thereafter
amended in accordance with the terms thereof and applicable laws.
Section 1.7. Officers, Managers and Committees of Managers. At and after the
Effective Time, the Trustee shall be replaced by the Partnership as trustee of the Surviving
Entity, and the entity serving as the Delaware trustee of NGT immediately prior to the Effective
Time shall continue to serve in such capacity for the Surviving Entity, each of whom shall hold
office subject to the provisions of the Trust Agreement, the Delaware Statutory Trust Act and the
certificate of trust of NGT.
Section 1.8. Conversion of NGT Trust Units into Partnership Common Units. At
the Effective Time, by virtue of the Merger and without any action on the part of any Party or any
holder of the securities of any Party, (i) subject to the proviso of the second sentence of this
Section 1.8, each trust unit of NGT outstanding immediately prior to the Effective Time
(except for trust units cancelled in accordance with the second sentence of this Section
1.8) shall be converted into 0.4 common units of the Partnership, subject to any adjustments
thereto, and (ii) each depositary unit of NGT outstanding immediately prior to the Effective Time
that is tendered to the Partnership on or after the Effective Time shall (except for depositary
units cancelled in accordance with the third sentence of this Section 1.8) entitle the
person so tendering to the right to receive one whole (1.0) common unit of the Partnership, subject
to any adjustments thereto, (collectively, the “Merger Consideration”); provided, however,
that no common units shall be issued in fractional part, and in lieu thereof shall be paid in cash
in an amount equal to such fractional part (expressed as a decimal and rounded to the nearest 0.01
of a common unit) multiplied by the average of the daily volume-weighted average prices, rounded to
four decimal points, of the Partnership common units on the New York Stock Exchange, as reported by
Bloomberg, for the 10 consecutive trading day period commencing on the first trading day on which
the common units trade regular way after the consummation of the Merger. As of the Effective Time,
(y) subject to the proviso of this clause (y), all trust units, including, but not limited to,
those underlying the depositary units, outstanding immediately prior to the Effective Time shall
automatically be cancelled and shall cease to exist, and any holder of any such trust units,
including, but not limited to, those underlying depositary units, shall cease to have any rights
with respect thereto, except the right to receive the Merger Consideration, without interest;
provided, however, that any trust units, including, but not limited to those underlying depositary
units, that are held by the Partnership immediately prior to the Effective Time shall remain issued
and outstanding at and after the Effective Time without any conversion thereof into Merger
Consideration; and (z) any trust units, including, but not limited to those underlying depositary
units, that are held in the treasury of NGT, if any, immediately prior to the Effective Time shall
automatically be cancelled and retired as of the Effective Time without any conversion thereof into
Merger Consideration and without any payment or distribution being
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made in respect thereto. Each equity security of the Partnership issued and outstanding
immediately prior to the Effective Time shall remain issued and outstanding at and after the
Effective Time, and shall constitute issued and outstanding equity securities of the Partnership.
ARTICLE II. APPROVAL OF TRUST UNITHOLDERS OF NGT
Section 2.1. Approval by Trust Unitholders. This Agreement and the
transactions contemplated herein shall be submitted to the holders of trust units of NGT for their
approval, and it shall have no force and effect unless approved by such holders in the manner
provide by the Trust Agreement and the DSTA. The Trust Agreement requires a vote of at least a
majority of all trust units of NGT in favor of the Merger. The Partnership holds more than a
majority of all trust units of NGT and has agreed to vote in favor of the Merger. As a
consequence, neither NGT nor the Partnership intends to solicit proxies from the other holders of
NGT trust units and will, instead, provide them with a definitive information statement relating to
the Merger.
ARTICLE III. CONDITIONS TO THE MERGER; TERMINATION
Section 3.1. Conditions to Closing. The respective obligations of each Party
to effect this Agreement and the transactions contemplated herein shall be subject to the
satisfaction at or immediately prior to the Effective Time of the following conditions:
(a) The approval of trust unitholders of NGT at the special meeting as contemplated by
Section 2.1 of the Agreement shall have been obtained.
(b) No temporary restraining order, preliminary or permanent injunction or other order issued
by any federal or state governmental authority (including, without limitation, any court of
competent jurisdiction) or any other legal restraint or prohibition preventing the consummation of
the Merger shall be in effect, and there shall not be in effect any law or other binding authority
that would make the consummation of the Merger illegal.
Section 3.2. Termination. This Agreement may be terminated and the Merger
abandoned at any time prior to the Effective Time by the General Partner on behalf of the
Partnership, without liability or other consequence to any Party, notwithstanding approval of this
Agreement and the transactions contemplated herein by the trust unitholders of NGT.
ARTICLE IV. MISCELLANEOUS
Section 4.1. Amendments. This Agreement may not be amended except by a
written instrument signed on behalf of each of the Parties.
Section 4.2. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware.
Section 4.3. Counterparts. This Agreement may be executed in counterparts,
each of which when so executed shall be deemed to be an original, and such counterparts shall
together constitute one and the same instrument.
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Section 4.4. Principal Office of Surviving Entity. The principal office of
the Partnership in the State of Delaware is, and at and after the Effective Time the principal
office of the Surviving Entity in the State of Delaware shall be, care of the Capitol Corporate
Services, Inc., 00 Xxxxxxxxxx Xxxxxx, Xxxxx 000, Xxxxx, XX 00000.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and delivered as of
the date first written above.
| The Partnership Ensource Energy Income Fund LP |
||||
| By: | Ensource Energy Partners, LP, its sole general partner | |||
| By: | ||||
| Name: | ||||
| Title: | ||||
| NGT Eastern American Natural Gas Trust |
||||
| By: | JPMorgan Chase Bank, its trustee | |||
| By: | ||||
| Name: | ||||
| Title: | ||||
| Merger Sub [To Come] |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
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Annex A
CERTIFICATE OF MERGER
MERGING
MERGING
WITH AND INTO
EASTERN AMERICAN NATURAL GAS TRUST
EASTERN AMERICAN NATURAL GAS TRUST
Pursuant to Section 18-209 of the Delaware Limited Liability Company Act
and
Section 3815(b) of the Delaware Statutory Trust Act
and
Section 3815(b) of the Delaware Statutory Trust Act
In connection with the merger (the “Merger”) of , a Delaware limited
liability company (the “Non-Surviving Entity”), with and into Eastern American Natural Gas
Trust, a Delaware statutory trust (the “Surviving Entity”), the Surviving Entity DOES
HEREBY CERTIFY:
FIRST: The name and jurisdiction of formation or organization of each of the constituent
entities in the Merger are as follows:
| Jurisdiction of Formation | ||||||||
| Name of Entity | Form of Entity | or Organization | ||||||
Eastern American Natural Gas Trust
|
Statutory Trust | Delaware | ||||||
[To Come]
|
Limited Liability Company | Delaware | ||||||
SECOND: An Agreement and Plan of Merger governing the Merger has been approved and executed by
each of the constituent entities.
THIRD: Eastern American Natural Gas Trust shall be the surviving entity in the Merger.
FOURTH: The name of the surviving entity in the Merger will be [Ensource Statutory Trust].
FIFTH: The Certificate of Trust of the Surviving Entity in effect immediately prior to the
Merger shall be its Certificate of Trust after the Merger; provided, however, that Article FIRST of
such Certificate of Trust shall be amended to read as follows:
The name of the trust is [Ensource Statutory Trust].
SIXTH: An executed copy of the Agreement and Plan of Merger governing the Merger is on file
at the office of the Surviving Entity at 0000 Xxx Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000.
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SEVENTH: An executed copy of the Agreement and Plan of Merger governing the Merger will be
furnished by the Surviving Entity, on request and without cost, to any holder of trust units in the
Non-Surviving Entity and any holder of common units of the Surviving Entity.
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IN WITNESS WHEREOF, the Surviving Entity has caused this Certificate of Merger to be executed
and attested by its authorized officers and delivered to the Delaware Secretary of State on this
the ___day of ___, 2005.
| EASTERN AMERICAN NATURAL GAS TRUST |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
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Annex B
Amended and Restated Trust Agreement
[To Come]
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