MERGER AGREEMENT
Merger Agreement dated as of , 1994, by and among
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Empire Gas Operating Corporation (formerly Empire Gas Corporation), a Missouri
corporation ("Subsidiary"), and Empire Gas Corporation (formerly Empire Gas
Acquisition Corporation), a Missouri corporation ("Parent").
SECTION 1
Effect of the Merger; Manner and
Basis of Converting and Cancelling Shares
1.1 At the Effective Time (as hereinafter defined), Subsidiary
shall be merged with and into Parent, the separate corporate existence of
Subsidiary (except as may be continued by operation of law) shall cease, and
Parent shall continue as the surviving corporation, all with the effects
provided by applicable law. Parent, in its capacity as the surviving
corporation of the Merger, is hereinafter sometimes referred to as the
"Surviving Corporation."
1.2 At the Effective Time, each share of common stock, $.01 par
value per share of Subsidiary ("Subsidiary Common Stock") issued and outstanding
immediately prior to the Effective Time (all of which are owned by Parent and
which consist of 10,448,162 shares of common stock) shall by virtue of the
Merger and without any action by Subsidiary, Parent, the stockholders of
Subsidiary or Parent or any other person, be cancelled.
1.3 At the Effective Time, each share of the Class A Preferred
Stock, without par value, of Subsidiary ("Subsidiary Class A Preferred Stock")
and each share of the Class B Preferred Stock, without par value, of Subsidiary
("Subsidiary Class B Preferred Stock") issued and outstanding immediately prior
to the Effective Time (all of which are owned by Parent and which consist of
100,000 shares of Subsidiary Class A Preferred Stock and 100,000 shares of
Subsidiary Class B Preferred Stock) shall by virtue of the Merger and without
any action by Subsidiary, Parent, the stockholders of Subsidiary or Parent or
any other person, be cancelled.
1.4 Shares of stock of Parent issued and outstanding immediately
prior to the Effective Time shall not be affected at
all by virtue of the Merger and shall continue to be outstanding immediately
after the Effective Time.
1.5 At and after the Effective Time, the Surviving Corporation
shall possess all the rights, privileges, powers and
franchises, of both a public and private nature, and be subject to all the
restrictions, disabilities and duties of Subsidiary, and all rights, privileges,
powers and franchises of Subsidiary, and all property, real, personal and mixed,
and all debts due on whatever account, including subscriptions for shares and
including the obligations under the Credit Agreement dated as of May 20, 1993
between Subsidiary and First National Bank of Boston, as agent (the "Credit
Agreement"), the obligations under an Indenture dated as of January 15, 1981
between Subsidiary and Continental Illinois National Bank and Trust Company of
Chicago with respect to 9% Convertible Subordinated Debentures due December 31,
1998, as amended by the Supplemental Indenture No. 1 thereto dated as of
December 3, 1985 and the Second Supplement to the Indenture dated December 13,
1989 (the "9% Convertible Subordinated Debenture Indenture"), the obligations
under an Indenture dated as of June 7, 1983 between Subsidiary and J. Henry
Schroder Bank and Trust Company with respect to 9% Subordinated Debentures due
December 31, 2007 and the First Supplement thereto dated December 13, 1989 (the
"9% Subordinated Debenture Indenture"), the obligations under an Indenture dated
as of March 31, 1986 between Subsidiary and First Trust Company, Inc. with
respect to 12% Senior Secured Debentures due 2002, as amended by the First
Supplement to the Indenture dated as of December 13, 1989 (the "12% Senior
Secured Debenture Indenture"), and all other choses in action, and all and every
other interest, of or belonging to Subsidiary, shall be taken and deemed to be
transferred to and vested in the Surviving Corporation without further act or
deed; and title to any real estate, or any interest therein, vested in
Subsidiary shall not revert or be in any way impaired by reason of the Merger;
and the Surviving Corporation shall thenceforth be responsible and liable for
all liabilities and obligations of Subsidiary; and any claim existing or action
or proceeding pending by or against Subsidiary may be prosecuted to judgment as
if the Merger had not taken place and the Surviving Corporation may be
substituted in its place; all with the effect set forth in Section 351.450 of
the General and Business Law of Missouri (the "Missouri Law").
1.6 At the Effective Time, the Surviving Corporation shall execute
supplemental indentures assuming the obligations of Subsidiary under the 9%
Convertible Subordinated Debenture Indenture, the 9% Subordinated Debenture
Indenture, and the 12% Senior Secured Debenture Indenture, pursuant to Sections
13.01, 12.01, and 13.01 thereof, respectively, and shall execute or provide such
additional documents as are required pursuant to those provisions.
1.7 At the Effective Time, the Surviving Corporation shall execute
assumption agreements assuming the obligations of Subsidiary under the Credit
Agreement and shall execute or provide such additional documents as are required
pursuant to those agreements.
SECTION 2
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Effective Time
2.1 Upon satisfaction of the conditions set forth in Section 4 of
this Merger Agreement, Parent shall cause Articles of Merger to be executed,
verified, attested to, and filed with the Secretary of State of the State of
Missouri as provided in Section 351.430 and 351.435 of the Missouri Law.
2.2 The Merger shall become effective (the "Effective Time") upon
the issuance of a certificate of merger by the Secretary of State of the State
of Missouri.
SECTION 3
Articles of Incorporation and
By-Laws; Board of Directors
3.1 The Articles of Incorporation of Parent as in effect at the
Effective Time shall govern the Surviving Corporation, until they shall be
amended as provided by law.
3.2 The By-Laws of Parent as in effect at the Effective Time,
subject to alteration, amendment or repeal from time to time by the Board of
Directors or the stockholders of the Surviving Corporation, shall govern the
Surviving Corporation.
3.3 The members of the Board of Directors of Subsidiary holding
office immediately prior to the Effective Time shall be the members of the Board
of Directors of the Surviving Corporation and the officers of Subsidiary holding
office immediately prior to the Effective Time shall be the officers (holding
the same positions as they held with Subsidiary immediately prior to the
Effective Time) of the Surviving Corporation and shall hold such offices until
the expiration of their current terms, or their prior resignation, removal or
death.
SECTION 4
Conditions
4.1 Consummation of the Merger shall be conditioned upon (i) the
receipt by Subsidiary of a waiver of Sections 8.12, 10.1.2 (solely with respect
to violations of Section 8.12), and 10.1.6(c) of the Credit Agreement, and (ii)
the effectiveness of the registration statement on Form S-1 filed by the Parent
with respect to the offering of senior secured notes by the Parent in aggregate
principal amount expected to result in aggregate offering proceeds of
$100,000,000.
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IN WITNESS WHEREOF, Parent and Subsidiary have caused this Merger
Agreement to be signed as of , 1994, by their respective
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officers.
EMPIRE GAS OPERATING CORPORATION
By:________________________________
Paul S. Lindsey, Jr.
Chief Operating Officer
EMPIRE GAS CORPORATION
By:_______________________________
Robert W. Plaster
Chief Executive Officer
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