EXHIBIT 2.1
AGREEMENT AND PLAN OF EXCHANGE
THIS AGREEMENT AND PLAN OF EXCHANGE (this "Agreement"), dated as of
December 20, 1996, is by and between Connecticut Natural Gas Corporation, a
Connecticut corporation ("CNG"), the company whose shares will be acquired
pursuant to this Agreement and Exchange, and CTG Resources, Inc., a
Connecticut corporation ("CTG"), the acquiring company. CNG and CTG are
sometimes hereinafter referred to, collectively, as the "Companies."
Recitals:
A. The authorized capital stock of CNG consists of (a) 20,000,000
shares of common stock, par value $3.125 per share ("CNG Common Stock"), of
which 10,634,329 shares are issued and outstanding; (b) 913,832 shares of
preferred stock, par value $3.125 per share ("CNG $3.125 Preferred Stock"),
of which 138,360 shares are issued and outstanding, and (c) 9,999,631 shares
of preferred stock, par value $100 per share ("CNG $100 Preferred Stock"),
of which 4,667 shares are issued and outstanding;
B. CTG is a wholly-owned subsidiary of CNG with authorized capital
stock consisting of 20,000 shares of common stock, without par value ("CTG
Common Stock"), of which 100 shares are issued and outstanding and owned of
record by CNG;
C. The Boards of Directors of the respective Companies deem it
desirable and in the best interests of the Companies and their shareholders
that CTG acquire each share of issued and outstanding CNG Common Stock and
that each such share of CNG Common Stock be exchanged for one CTG Common
Stock, with the result that CTG becomes the owner of all outstanding CNG
Common Stock and that each holder of CNG Common Stock becomes the owner of
an equal number of shares of CTG Common Stock (the "Exchange");and
D. The Boards of Directors of CNG and of CTG have recommended
thattheir respective shareholders approve the Exchange pursuant to the
applicable provisions of the Connecticut Business Corporation Act ("CBCA").
NOW, THEREFORE, in consideration of the premises, and of the agreements
and conditions hereinafter contained, the Companies agree that, at the
Effective Time (as hereinafter defined), each share of CNG Common Stock
issued and outstanding immediately prior to the Effective Time will be
exchanged for one share of CTG Common Stock, and that the terms and
conditions of the Exchange and the method of carrying the same into effect
are as follows:
ARTICLE I
FILING OF ARTICLES; EFFECTIVE TIME
Subject to the satisfaction of the conditions set forth in Article III
and to the provisions of Article IV, and in no event prior to January 1,
1997, the Companies agree to file with the Secretary of the State of the
State of Connecticut (the "Secretary of the State") Articles of Share
Exchange ("Articles") with respect to the Exchange and the Exchange shall
take effect upon such filing or at such later time as may be stated in the
Articles (the time at which the Exchange takes effect being referred to
herein as the "Effective Time").
ARTICLE II
EXCHANGE OF SHARES
At the Effective Time:
(1) each share of CNG Common Stock issued and outstanding
immediately prior to the Effective Time shall be
acquired by CTG and shall be exchanged for one share of
CTG Common Stock, which shall thereupon be fully paid
and non-assessable;
(2) CTG shall become the owner and holder of each issued and
outstanding share of CNG Common Stock so exchanged;
(3) each share of CTG Common Stock issued and outstanding
immediately prior to the Effective Time shall be
cancelled and shall thereupon constitute an authorized
and unissued share of CTG Common Stock; and
(4) the former owners of CNG Common Stock shall be entitled
only to receive shares of CTG Common Stock as provided
herein.
Shares of CNG $3.125 Preferred Stock and CNG $100 Preferred Stock shall
not be exchanged or otherwise affected in connection with the Exchange and,
to the extent issued and outstanding immediately prior to the Effective
Time, shall continue to be issued and outstanding following the Exchange.
ARTICLE III
CONDITIONS PRECEDENT
The consummation of the Exchange is subject to the following conditions
precedent:
(1) the approval by the shareholders of the Companies, to the extent
required by the CBCA, of this Agreement and the Exchange;
(2) the approval for listing, upon official notice of issuance, by the
New York Stock Exchange, of the CTG Common Stock to be issued in accordance
with the Exchange;
(3) the receipt of such orders, authorizations, approvals or waivers
from regulatory bodies, boards or agencies as are required in connection
with the Exchange;
(4) the receipt by CNG of a tax opinion acceptable to CNG's Board of
Directors as to the federal income tax consequences of the Exchange; and
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(5) amendment of the Certificate of Incorporation of CTG to authorize
the issuance of up to 20,000,000 shares of CTG Common Stock and 2,000,000
shares of preferred stock.
ARTICLE IV
AMENDMENTS, MODIFICATIONS, WAIVERS AND TERMINATION
This Agreement may be amended, modified or supplemented, or compliance
with any provision or condition hereof may be waived, at any time, by the
mutual consent of the Boards of Directors of CNG and CTG; provided, however,
that no such amendment, modification, supplement or waiver shall be made or
effected after approval of the Agreement and the Exchange by the
shareholders of CNG, if it would, in the judgment of the Board of Directors
of CNG, materially and adversely affect the shareholders of CNG.
This Agreement may be terminated and the Exchange and related
transactions abandoned at any time prior to the time the Articles are filed
with the Secretary of the State if the Board of Directors of CNG determines,
in its sole discretion, that consummation of the Exchange would be
inadvisable or not in the best interests of CNG or its shareholders.
ARTICLE V
SHAREHOLDER APPROVAL; EXCHANGE OF CERTIFICATES
This Agreement will be submitted to the shareholders of CNG entitled to
vote with respect to the Exchange and to the shareholder of CTG for approval
as provided by the CBCA.
Following the Effective Time, each holder of an outstanding certificate
or certificates theretofore representing shares of CNG Comon Stock may, but
shall not be required to, surrender the same to CTG for cancellation and
reissuance of a new certificate or certificates in such holder's name or for
cancellation and transfer, and each such holder or transferee will be
entitled to receive a certificate or certificates representing the same
number of shares of CTG Common Stock as the shares of CNG Common Stock
previously represented by the certificate or certificates surrendered.
Until so surrendered or presented for transfer, each outstanding certificate
which, immediately prior to the Effective Time, represented CNG Common Stock
shall be deemed and treated for all corporate purposes to represent the
ownership of the same number of shares of CTG Common Stock as though such
surrender or transfer and exchange had taken place. The holders of CNG
Common Stock at the Effective Time shall have no right to have their shares
of CNG Common Stock transferred on the stock transfer books of CNG, and such
stock transfer books shall be deemed to be closed for this purpose at the
Effective Time.
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IN WITNESS WHEREOF, each of CNG and CTG, pursuant to authorization and
approval given by its Board of Directors, has caused this Agreement to be
executed by a duly authorized Officer and its corporate seal to be affixed
hereto and attested by its Secretary as of the date first above written.
CONNECTICUT NATURAL GAS CORPORATION
By: /s/ Reginald L. Babcock
-------------------------------------
Name: Reginald L. Babcock
Title: Vice President, General Counsel
and Secretary
ATTEST:
/s/ Lynn C. Blackwell
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Assistant Secretary
(SEAL)
CTG RESOURCES, INC.
By: /s/ James P. Bolduc
-------------------------------------
Name: James P. Bolduc
Title: Executive Vice President and
Chief Financial Officer
ATTEST:
/s/ Reginald L. Babcock
---------------------------
Secretary
(SEAL)
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