EXHIBIT 2
AGREEMENT AND PLAN OF EXCHANGE
THIS AGREEMENT AND PLAN OF EXCHANGE ("Agreement"), dated as of January 24,
1996, is between MidAmerican Energy Company, an Iowa corporation ("MidAmerican"
or "Company"), the company whose shares will be acquired pursuant to the Share
Exchange (described hereinafter), and MidAmerican Energy Holdings Company, an
Iowa corporation ("Holdings"), the acquiring company. MidAmerican and Holdings
are hereinafter sometimes referred to, collectively, as the "Companies".
WITNESSETH:
WHEREAS, the authorized capital stock of MidAmerican consists of (a)
350,000,000 shares of common stock without par value ("Company Common Stock"),
of which 100,751,713 shares are issued and outstanding, and (b) 100,000,000
shares of preferred stock, without par value ("Company Preferred Stock"), of
which 3,217,769 shares are issued and outstanding; and
WHEREAS, Holdings has 1,000 shares of common stock, no par value, ("Holdings
Common Stock") presently authorized, issued and outstanding, and at the
Effective Time (as hereinafter defined), the authorized capital stock of
Holdings will consist of (a) 350,000,000 shares of Holdings Common Stock and (b)
100,000,000 shares of preferred stock, no par value ("Holdings Preferred
Stock"); and
WHEREAS, the Boards of Directors of each of MidAmerican and Holdings deem it
desirable and in the best interests of the Companies and their shareholders that
each share of Company Common Stock be exchanged for a share of Holdings Common
Stock with the result that Holdings becomes the owner of all outstanding Company
Common Stock and each holder of Company Common Stock becomes the owner of an
equal number of shares of Holdings Common Stock, all pursuant to the terms and
conditions hereinafter set forth ("Share Exchange"); and
WHEREAS, the Iowa Business Corporation Act ("IBCA") permits share exchanges
which bind all of the shareholders upon the approval of a plan of share exchange
by the holders of a majority of all votes entitled to be voted thereon; and
WHEREAS, the Boards of Directors of MidAmerican and Holdings have
recommended that their respective shareholders approve the Share Exchange and
this Agreement, and this Agreement has been approved by the requisite vote of
Holdings' shareholder pursuant to Section 490.1103 of the IBCA;
NOW, THEREFORE, in consideration of the premises, and of the agreements,
covenants and conditions hereinafter contained, the parties hereto agree with
respect to the Share Exchange that, at the Effective Time, each share of Company
Common Stock issued and outstanding immediately prior to the Effective Time will
be exchanged for one share of Holdings Common Stock, and that the terms and
conditions of the Share Exchange and the method of carrying the same into effect
are as follows:
ARTICLE I
Subject to the satisfaction of the conditions and obligations of the parties
hereto, the Share Exchange will be effective upon the filing, with the Iowa
Secretary of State, in accordance with the IBCA, of articles of share exchange
("Articles of Exchange") with respect to the Share Exchange or at such later
time as may be stated in the Articles of Exchange (the time at which the Share
Exchange becomes effective being referred to herein as the "Effective Time").
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ARTICLE II
(1) The name of the corporation whose shares will be acquired is MidAmerican
Energy Company, and the name of the acquiring corporation is MidAmerican Energy
Holdings Company.
(2) The terms and conditions of the exchange, and the manner and basis of
exchanging the shares of Company Common Stock to be acquired for shares of
Holdings Common Stock, are as follows:
At the Effective Time:
(a) Each share of Company Common Stock issued and outstanding
immediately prior to the Effective Time shall be exchanged for one share of
Holdings Common Stock, which shall thereupon be fully paid and
non-assessable, except the shares for which dissenters' rights were
exercised;
(b) Holdings shall become the owner and holder of each issued and
outstanding share of Company Common stock so exchanged;
(c) Each share of Holdings Common Stock issued and outstanding
immediately prior to the Effective Time shall be canceled and shall
thereupon constitute an authorized and unissued share of Holdings Common
Stock;
(d) The former owners of Company Common Stock shall be entitled only to
receive shares of Holdings Common Stock as provided herein; and
(e) Holders of Company Common Stock who exercised their dissenters'
rights in accordance with the IBCA shall be entitled to receive payment of
"fair value" for their shares of Company Common Stock.
Shares of outstanding Company Preferred Stock shall not be exchanged or
otherwise affected by the Share Exchange.
ARTICLE III
The consummation of the Share Exchange is subject to the following
conditions precedent:
(1) The receipt of the requisite approval of the Share Exchange by the
holders of Company Common Stock;
(2) The filing of Restated Articles of Incorporation of Holdings
increasing the number of authorized shares of Holdings Common Stock and
Holdings Preferred Stock to 350,000,000 and 100,000,000 shares,
respectively, in the form attached hereto as Exhibit A;
(3) The satisfaction of the respective obligations of the parties hereto
set forth in this Agreement in accordance with the terms and conditions
herein contained;
(4) The execution and filing of Articles of Exchange with the Iowa
Secretary of State pursuant to the IBCA in the form attached hereto as
Exhibit B;
(5) The approval for listing upon official notice of issuance by the New
York Stock Exchange of Holdings Common Stock to be issued in accordance with
this Agreement;
(6) The receipt of either a ruling of the Internal Revenue Service
satisfactory to MidAmerican and its counsel, or an opinion of counsel
satisfactory to MidAmerican, with respect to the tax consequences of the
Share Exchange and other transactions incident thereto; and
(7) The receipt of such orders, authorizations, approvals or waivers
from all jurisdictional regulatory bodies, boards or agencies, which are
required in connection with the Share Exchange and related transactions.
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ARTICLE IV
Holdings will not engage in any business following the execution of this
Agreement until the consummation of the Share Exchange, other than such business
as is necessary to organize and maintain the corporate status and good standing
of Holdings in the State of Iowa and such other states in which it may be
authorized to conduct business.
ARTICLE V
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 Board of Directors of each of MidAmerican and Holdings; provided,
however, that no such amendment, modification, supplement or waiver shall be
made or effected, if such amendment, modification, supplement or waiver would,
in the judgment of the Board of Directors of MidAmerican, materially and
adversely affect the shareholders of MidAmerican.
This Agreement may be terminated and the Share Exchange and related
transactions abandoned at any time prior to the time the Articles of Exchange
are filed with the Iowa Secretary of State, if the Board of Directors of
MidAmerican determines, in its sole discretion, that consummation of the Share
Exchange would be inadvisable or not in the best interest of MidAmerican or its
shareholders.
ARTICLE VI
This Agreement has been submitted to the shareholder of Holdings for
approval, and the shareholder of Holdings has approved this Agreement, as
provided by the IBCA.
ARTICLE VII
Following the Effective Time, each holder of an outstanding certificate or
certificates theretofore representing shares of Company Common Stock may, but
shall not be required to, surrender the same to Holdings 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 Holdings Common Stock as the shares of Company 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 Company Common Stock shall be deemed and
treated for all corporate purposes to represent the ownership of the same number
of shares of Holdings Common Stock as though such surrender or transfer had
taken place. The holders of Company Common Stock at the Effective Time shall
have no right to have their shares of Company Common Stock transferred on the
stock transfer books of MidAmerican, 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 MidAmerican and Holdings, pursuant to
authorization and approval given by their respective Boards of Directors, has
caused this Agreement to be executed by its President and attested by its
Secretary as of the date first above written.
MIDAMERICAN ENERGY COMPANY
By ___________________________________
PRESIDENT
ATTEST
______________________________________
SECRETARY
MIDAMERICAN ENERGY HOLDINGS COMPANY
By ___________________________________
PRESIDENT
ATTEST
______________________________________
SECRETARY
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