MUNDER SERIES TRUST
MUNDER SERIES TRUST II
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION ("Agreement") is made as of
this 20th day of December, 2010, by Munder Series Trust, a Delaware
statutory trust ("MST"), with its principal place of business at
000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, on behalf of the Munder
Growth Opportunities Fund ("Acquiring Fund"), a separate series of MST,
and Munder Series Trust II, a business trust under the laws of the
Commonwealth of Massachusetts ("MST II"), with its principal place of
business at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, on behalf of
the Munder Healthcare Fund ("Acquired Fund"), a separate series of
MST II.
This Agreement is intended to be and is adopted as a plan of
redomiciliation, reorganization and liquidation within the meaning of
Section 368(a)(1) of the United States Internal Revenue Code of 1986,
as amended ("Code"). The redomiciliation, reorganization and liquidation
will consist of (1) the sale, assignment, conveyance, transfer and
delivery of all of the property and assets of the Acquired Fund to the
Acquiring Fund in exchange solely for shares of beneficial interest of
Class A, B, C, R and Y shares of the Acquiring Fund ("Acquiring Fund
Shares") corresponding to or designated in this Agreement in Section 1.1
of this Agreement as the corresponding class of outstanding shares of
beneficial interest of the Acquired Fund ("Acquired Fund Shares"), as
described herein, (2) the assumption by the Acquiring Fund of all
liabilities of the Acquired Fund, and (3) the distribution of the
Acquiring Fund Shares to the shareholders of the Acquired Fund in
complete liquidation of the Acquired Fund, as provided herein
("Reorganization"), all upon the terms and conditions hereinafter set
forth in this Agreement.
WHEREAS, the Acquiring Fund is a series of MST, a registered investment
company classified as a management investment company of the open-end
type under the Investment Company Act of 1940, as amended ("1940 Act");
WHEREAS, the Acquired Fund is a series of MST II, a registered
investment company classified as a management investment company of the
open-end type under the 1940 Act, and the Acquired Fund owns securities
that generally are assets of the character in which the Acquiring Fund
is permitted to invest;
WHEREAS, following the Reorganization, MST II will deregister as an
investment company in accordance with the rules and regulations of the
Securities and Exchange Commission ("Commission");
WHEREAS, following the effective date of its deregistration, MST II
shall voluntarily dissolve in accordance with Massachusetts law and
the terms of its Declaration of Trust, as amended from time to time
("Declaration");
WHEREAS, the Trustees of MST have determined, with respect to the
Acquiring Fund, that the sale, assignment, conveyance, transfer and
delivery of all of the property and assets of the Acquired Fund for
Acquiring Fund Shares and the assumption of all liabilities of the
Acquired Fund by the Acquiring Fund is in the best interests of the
Acquiring Fund and that the interests of the existing shareholders of
the Acquiring Fund would not be diluted as a result of this
transaction; and
WHEREAS, the Trustees of MST II have determined, with respect to the
Acquired Fund, that the sale, assignment, conveyance, transfer and
delivery of all of the property and assets of the Acquired Fund for
Acquiring Fund Shares and the assumption of all liabilities of the
Acquired Fund by the Acquiring Fund is in the best interests of the
Acquired Fund and that the interests of the existing shareholders of
the Acquired Fund would not be diluted as a result of this transaction;
NOW, THEREFORE, in consideration of the premises and of the covenants
and agreements hereinafter set forth, the parties hereto covenant and
agree as follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND TO THE ACQUIRING FUND IN EXCHANGE
FOR ACQUIRING FUND SHARES, THE ASSUMPTION OF ALL ACQUIRED FUND LIABILITIES AND
THE LIQUIDATION OF THE ACQUIRED FUND
1.1. Subject to the requisite approval by Acquired Fund Shareholders
and the other terms and conditions herein set forth and on the basis
of the representations and warranties contained herein, the Acquired
Fund agrees to sell, assign, convey, transfer and deliver all of the
property and assets of the Acquired Fund, as set forth in paragraph 1.2,
to the Acquiring Fund, and the Acquiring Fund agrees in exchange
therefore: (a) to deliver to the Acquired Fund the number of full and
fractional Class A, B, C, R and Y Acquiring Fund Shares determined by
dividing the value of the Acquired Fund's net assets with respect to
each corresponding class of Acquired Fund Shares, computed in the manner
and as of the time and date set forth in paragraph 2.1, by the net asset
value of one Acquiring Fund Share of the corresponding class, computed
in the manner and as of the time and date set forth in paragraph 2.2;
and (b) to assume all liabilities of the Acquired Fund, as set forth
in paragraph 1.3. Such transactions shall take place on the date of
the closing provided for in paragraph 3.1 ("Closing Date"). For
purposes of this Agreement, and this paragraph 1.1 in particular,
Class K shares of the Acquired Fund shall be deemed to correspond to
Class A shares of the Acquired Fund.
1.2. The property and assets of MST II attributable to the Acquired
Fund to be sold, assigned, conveyed transferred and delivered to and
acquired by the Acquiring Fund shall consist of all property and assets,
including, without limitation, all rights, cash, securities, commodities
and futures interests and dividends or interests receivable that are
owned by the Acquired Fund and any deferred or prepaid expenses shown
as an asset on the books of the Acquired Fund on the Valuation Date as
defined in paragraph 2.1 (collectively, "Assets"). The Acquired Fund
will sell, assign, convey, transfer and deliver to the Acquiring Fund
any rights, stock dividends, or other securities, if any, received by
the Acquired Fund after the Closing Date as stock dividends or other
distributions on or with respect to the Assets transferred, which
rights, stock dividends, and other securities shall be deemed included
in the Assets transferred to the Acquiring Fund at the Closing Date and
shall not be separately valued, in which case any such stock dividends
or other distribution that remain unpaid and/or have not been received
by the Acquired Fund as of the Closing Date shall be included in the
determination of the value of the Assets of the Acquired Fund acquired
by the Acquiring Fund.
1.3. The Acquired Fund will make reasonable efforts to discharge all of
its known liabilities and obligations prior to the Valuation Date. The
Acquiring Fund shall assume all of the liabilities of the Acquired Fund,
whether accrued or contingent, known or unknown, existing at the
Valuation Date (collectively, "Liabilities"). On or as soon as
practicable prior to the Closing Date, the Acquired Fund will declare
and pay to its shareholders of record one or more dividends and/or other
distributions so that it will have distributed substantially all (and
in no event less than 98%) of its investment company taxable income
(computed without regard to any deduction for dividends paid) and
realized net capital gain (after reduction for any available capital
loss carryover), if any, for the current taxable year through the
Closing Date.
1.4. Immediately following the actions contemplated by paragraph 1.1,
MST II shall take such actions necessary to complete the liquidation of
the Acquired Fund. To complete the liquidation, MST II, on behalf of
the Acquired Fund, shall (a) distribute to the Acquired Fund's
shareholders of record with respect to each class of its shares as of
the Closing as defined in paragraph 3.1 ("Acquired Fund Shareholders"),
on a pro rata basis within that class, the Acquiring Fund Shares of
the corresponding class received by the Acquired Fund pursuant to
paragraph 1.1, and (b) completely liquidate the Acquired Fund. Such
distribution and liquidation will be accomplished, with respect to each
class of the Acquired Fund's shares, by the transfer of the Acquiring
Fund Shares then credited to the account of the Acquired Fund on the
books of the Acquiring Fund to open accounts on the share records of
the Acquiring Fund in the names of the Acquired Fund Shareholders. The
aggregate net asset value of Class A, B, C, A, R, and Y Acquiring Fund
Shares to be so credited to Class A, B, C, K, R, and Y Acquired Fund
Shareholders, respectively, shall, with respect to each class, be equal
to the aggregate net asset value of the Acquired Fund Shares of the
corresponding class owned by Acquired Fund Shareholders on the Closing
Date. All issued and outstanding Acquired Fund Shares will simultaneously
be canceled on the books of the Acquired Fund. The Acquiring Fund will
not issue certificates representing the Class A, B, C, R, and Y
Acquiring Fund Shares in connection with the Reorganization.
1.5. Ownership of Acquiring Fund Shares will be shown on the books of
the Acquiring Fund's Transfer Agent, as defined in paragraph 3.3 hereof.
1.6. Any reporting responsibility of the Acquired Fund, including, but
not limited to, the responsibility for filing regulatory reports, tax
returns, or other documents with the Securities and Exchange Commission
("Commission"), any state securities commission, and any federal, state
or local tax authorities or any other relevant regulatory authority,
is and shall remain the responsibility of the Acquired Fund.
1.7. As promptly as practicable following the Reorganization of the
Acquired Fund, MST II will take all necessary actions to effect its
deregistration as an investment company in accordance with the rules
and regulations of the Commission and shall subsequently voluntarily
dissolve in accordance with the requirements of Massachusetts law.
2. VALUATION
2.1. The value of the Assets shall be the value of such Assets as of the
close of business of the New York Stock Exchange and after the
declaration of any dividends on the Closing Date (such time and date
being also referred to herein as the "Valuation Date"), computed using
the valuation procedures set forth in the Acquired Fund's then-current
prospectus and statement of additional information, each as may be
supplemented, and valuation procedures established by MST II's Board
of Trustees.
2.2. The net asset value of each Class A, B, C, R, and Y Acquiring
Fund Share shall be the net asset value per share computed with respect
to that class as of the Valuation Date, computed using the valuation
procedures set forth in the Acquiring Fund's then-current prospectus
and statement of additional information, each as may be supplemented,
and valuation procedures established by MST's Board of Trustees.
2.3. The number of the Class A, B, C, R, and Y Acquiring Fund Shares to
be issued (including fractional shares, if any) in exchange for the
Acquired Fund's Assets shall be determined with respect to each such
class by dividing the value of the net assets with respect to the
corresponding Class A, B, C, K, R, and Y Acquired Fund Shares, as the
case may be, determined using the same valuation procedures referred to
in paragraph 2.1, by the net asset value of a corresponding Acquiring
Fund Share, determined using the same valuation procedures referred to
in paragraph 2.2.
2.4. All computations of value shall be made by State Street Bank and
Trust Company, in its capacity as sub-administrator for MST II, and
shall be subject to confirmation by Munder Capital Management ("MCM"),
MST II's administrator.
3. CLOSING AND CLOSING DATE
3.1. The Closing Date shall be March 25, 2011, or such other date as
the parties may agree. All acts taking place at the closing of the
transactions provided for in this Agreement ("Closing") shall be deemed
to take place simultaneously as of the close of business on the Closing
Date unless otherwise agreed to by the parties. The close of business on
the Closing Date shall be as of 4:00 p.m., Eastern Time. The Closing
shall be held at the offices of MST or at such other time and/or place
as the parties may agree.
3.2. MST II shall direct State Street Bank and Trust Company, as
custodian for the Acquired Fund ("Custodian"), to deliver to MST at the
Closing a certificate of an authorized officer of the Custodian stating
that (a) the Assets of the Acquired Fund have been delivered in proper
form to the Acquiring Fund within two (2) business days prior to or on
the Closing Date, and (b) State Street has paid such amounts, or set
aside such amounts necessary for payment, as it has been instructed by
an authorized person of the Funds under the Custody Agreement. The
Acquired Fund's portfolio securities represented by a certificate or
other written instrument shall be presented by the Custodian to those
persons at the Custodian who have primary responsibility for the
safekeeping of the assets of the Acquiring Fund, as the Custodian also
serves as the custodian for the Acquiring Fund. Such presentation shall
be made for examination no later than five (5) business days preceding
the Closing Date, and such certificates and other written instruments
shall be transferred and delivered by the Acquired Fund as of the
Closing Date for the account of the Acquiring Fund duly endorsed in
proper form for transfer in such condition as to constitute good
delivery thereof. The Custodian shall deliver to those persons at the
Custodian who have primary responsibility for the safekeeping of the
assets of the Acquiring Fund as of the Closing Date by book entry, in
accordance with the customary practices of the Custodian and of each
securities depository, as defined in Rule 17f-4 under the 1940 Act, in
which the Acquired Fund's Assets are deposited, the Acquired Fund's
Assets deposited with such depositories. The cash to be transferred by
the Acquired Fund shall be delivered by wire transfer of Federal funds
on the Closing Date.
3.3. MST II shall direct BNY Mellon Investment Servicing (US) Inc.
(formerly known as PNC Global Servicing Inc.), in its capacity as
transfer agent for the Acquired Fund ("Transfer Agent"), to deliver to
MST at the Closing a certificate of an authorized officer of the
Transfer Agent stating that its records contain the names and addresses
of each Acquired Fund Shareholder and the number and percentage
ownership of outstanding Class A, B, C, K, R and Y shares owned by each
such shareholder immediately prior to the Closing. The Secretary of MST
shall confirm that (a) the appropriate number of corresponding Acquiring
Fund Shares have been credited to the Acquired Fund's account on the
books of the Acquiring Fund pursuant to paragraph 1.1 prior to the
actions contemplated by paragraph 1.4, and (b) the appropriate number
of corresponding Acquiring Fund Shares have been credited to the
accounts of the Acquired Fund Shareholders on the books of the Acquiring
Fund pursuant to paragraph 1.4. At the Closing MST and MST II shall
execute such bills of sale, checks, assignments, stock certificates, if
any, receipts or other documents as necessary to effect the
Reorganization.
3.4. In the event that on the Valuation Date (a) the New York Stock
Exchange or another primary trading market for portfolio securities of
the Acquiring Fund or the Acquired Fund (each, an "Exchange") shall be
closed to trading or trading thereupon shall be restricted, or
(b) trading or the reporting of trading on such Exchange or elsewhere
shall be disrupted so that, in the judgment of the Board of Trustees
of MST and the Board of Trustees of MST II, accurate appraisal of the
value of the net assets of the Acquiring Fund or the Acquired Fund is
impracticable, the Closing Date shall be postponed until the first
business day practicable after the day when trading shall have been
fully resumed and reporting shall have been restored.
4. REPRESENTATIONS AND WARRANTIES
4.1. Except as has been fully disclosed to the Acquiring Fund prior to
the date of this Agreement in a written instrument executed by an
officer of MST II, MST II, on behalf of the Acquired Fund, represents
and warrants to the Acquiring Fund as follows:
(a) The Acquired Fund is duly organized as series of MST II, which
is a business trust duly organized, validly existing and in good
standing under the laws of the Commonwealth of Massachusetts, with
power under MST II's Declaration of Trust, as amended from time
to time ("Declaration"), to own all of its Assets and to carry on
its business as it is now being conducted;
(b) MST II is a registered investment company classified as a
management company of the open-end type, and its registration with
the Commission as an investment company under the 1940 Act, and
the registration of the Class A, B, C, K, R and Y Acquired Fund
Shares under the Securities Act of 1933, as amended ("1933 Act"),
is in full force and effect;
(c) No consent, approval, authorization, or order of any court or
governmental authority is required for the consummation by the
Acquired Fund of the transactions contemplated herein, except
such as may be required under the 1933 Act, the Securities
Exchange Act of 1934, as amended ("1934 Act"), the 1940 Act and
state securities laws;
(d) The current prospectus and statement of additional information
of the Acquired Fund and each prospectus and statement of
additional information of the Acquired Fund used at all times
prior to the date of this Agreement conforms or conformed at the
time of its use in all material respects to the applicable
requirements of the 1933 Act and the 1940 Act and the rules and
regulations of the Commission thereunder and does not or did not
at the time of its use include any untrue statement of a material
fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not materially
misleading;
(e) On the Valuation Date, MST II, on behalf of the Acquired Fund,
will have good and marketable title to the Assets of the Acquired
Fund and full right, power, and authority to sell, assign, convey,
transfer and deliver such Assets hereunder free of any liens or
other encumbrances, and upon delivery and payment for such Assets,
MST, on behalf of the Acquiring Fund, will acquire good and
marketable title thereto, subject to no restrictions on the full
transfer thereof, including such restrictions as might arise under
the 1933 Act;
(f) The Acquired Fund is not engaged currently, and the execution,
delivery and performance of this Agreement will not result, in
(i) a material violation of MST II's Declaration or By-Laws or of
any agreement, indenture, instrument, contract, lease or other
undertaking to which MST II, on behalf of the Acquired Fund, is a
party or by which it is bound, or (ii) the acceleration of any
material obligation, or the imposition of any material penalty,
under any agreement, indenture, instrument, contract, lease,
judgment or decree to which MST II, on behalf of the Acquired Fund,
is a party or by which it is bound;
(g) All material contracts or other commitments of the Acquired
Fund (other than this Agreement and certain investment contracts
including options, futures, and forward contracts) will terminate
without liability to the Acquired Fund on or prior to the
Closing Date;
(h) No litigation or administrative proceeding or investigation
of or before any court or governmental body is presently pending
or, to MST II's knowledge, threatened against MST II, with
respect to the Acquired Fund or any of its properties or Assets,
that, if adversely determined, would materially and adversely
affect its financial condition or the conduct of its business.
MST II, on behalf of the Acquired Fund, knows of no facts which
might form the basis for the institution of such proceedings and
is not a party to or subject to the provisions of any order,
decree or judgment of any court or governmental body which
materially and adversely affects its business or its ability to
consummate the transactions herein contemplated;
(i) The Statement of Assets and Liabilities, Statements of
Operations and Changes in Net Assets, and Schedule of Investments
of the Acquired Fund at June 30, 2010 have been audited by
Ernst & Young LLP, Independent Registered Public Accounting Firm,
and are in accordance with accounting principles generally
accepted in the United States of America ("GAAP") consistently
applied, and such statements present fairly, in all material
respects, the financial condition of the Acquired Fund as of such
date in accordance with GAAP, and there are no known contingent
liabilities of the Acquired Fund required to be reflected on a
balance sheet (including the notes thereto) in accordance with
GAAP as of such date not disclosed therein;
(j) Since June 30, 2010, there has not been any material adverse
change in the Acquired Fund's financial condition, Assets,
liabilities or business, other than changes occurring in the
ordinary course of business, or any incurrence by the Acquired
Fund of indebtedness other than in the ordinary course in
accordance with the Acquired Fund's investment restrictions.
For the purposes of this subparagraph (j), a decline in net asset
value per share of Acquired Fund Shares due to declines in market
values of securities held by the Acquired Fund, the discharge of
the Acquired Fund's liabilities, or the redemption of Acquired
Fund Shares by shareholders of the Acquired Fund shall not
constitute a material adverse change;
(k) On the Closing Date, all federal and other tax returns,
dividend reporting forms, and other tax-related reports of the
Acquired Fund required by law to have been filed by such date
(including any extensions) shall have been filed and are or will
be correct in all material respects, and all federal and other
taxes shown as due or required to be shown as due on said returns
and reports shall have been paid or provision shall have been
made for the payment thereof and, to the best knowledge of
MST II, no such return is currently under audit and no assessment
has been asserted with respect to such returns;
(l) For each taxable year of its operation (including the
taxable year ending on the Closing Date), the Acquired Fund has
met (or will meet) the requirements of Subchapter M of the Code
for qualification as a regulated investment company, has been (or
will be) eligible to and has computed (or will compute) its
federal income tax under Section 852 of the Code, and will have
distributed all of its investment company taxable income
(computed without regard to any deduction for dividends paid)
and net capital gain (as defined in the Code) that has accrued
through the Closing Date, and before the Closing Date will have
declared dividends sufficient to distribute all of its investment
company taxable income (computed without regard to any deduction
for dividends paid) and net capital gain (after reduction for any
available capital loss carryover) for the period ending on the
Closing Date;
(m) All issued and outstanding Acquired Fund Shares are, and on
the Closing Date will be, duly authorized and validly issued and
outstanding, fully paid and non-assessable by MST II and have been
offered and sold in every state, territory and the District of
Columbia in compliance in all material respects with applicable
registration requirements of the 1933 Act and other securities
laws. All of the issued and outstanding Acquired Fund Shares will,
at the time of Closing, be held by the persons and in the amounts
set forth in the records of the Transfer Agent, on behalf of the
Acquired Fund, as provided in paragraph 3.3. The Acquired Fund
does not have outstanding any options, warrants or other rights
to subscribe for or purchase any of the Acquired Fund Shares, nor
is there outstanding any security convertible into any of the
Acquired Fund Shares;
(n) The execution, delivery and performance of this Agreement
and the transactions contemplated herein have been duly
authorized by all necessary action, if any, on the part of the
Trustees of MST II, on behalf of the Acquired Fund, and by the
approval of the Acquired Fund's shareholders, as described in
paragraph 8.1, and this Agreement constitutes a valid and binding
obligation of MST II, on behalf of the Acquired Fund, enforceable
in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization, moratorium and other
laws relating to or affecting creditors' rights and to general
equity principles; and
(o) The information to be furnished by the Acquired Fund for use
in the Registration Statement (as defined in paragraph 5.5) or
any other documents filed or to be filed with any federal, state
or local regulatory authority (including the Financial Industry
Regulatory Authority, Inc.), which may be necessary in connection
with the transactions contemplated hereby, shall be accurate and
complete in all material respects and shall comply in all material
respects with federal securities and other laws and regulations
thereunder applicable thereto.
4.2. Except as has been fully disclosed to the Acquired Fund prior to
the date of this Agreement in a written instrument executed by an
officer of MST, MST, on behalf of the Acquiring Fund, represents and
warrants to the Acquired Fund as follows:
(a) The Acquiring Fund is duly organized as a series of MST,
which is a statutory trust duly organized, validly existing,
and in good standing under the laws of the State of Delaware,
with power under MST's Declaration, as amended from time to time
to own all of its properties and assets and to carry on its
business as it is now being conducted;
(b) MST is a registered investment company classified as a
management company of the open-end type, and its registration
with the Commission as an investment company under the 1940 Act
and the registration of the Class A, B, C, R, and Y Acquiring
Fund Shares under the 1933 Act, is in full force and effect;
(c) No consent, approval, authorization, or order of any court
or governmental authority is required for the consummation by
the Acquiring Fund of the transactions contemplated herein,
except such as may be required under the 1933 Act, the 1934 Act,
the 1940 Act and state securities laws;
(d) The current prospectus and statement of additional information
of the Acquiring Fund and each prospectus and statement of
additional information of the Acquiring Fund used at all times
prior to the date of this Agreement conforms or conformed at the
time of its use in all material respects to the applicable
requirements of the 1933 Act and the 1940 Act and the rules and
regulations of the Commission thereunder and does not or did not
at the time of its use include any untrue statement of a material
fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not materially
misleading;
(e) The Acquiring Fund is not engaged currently, and the
execution, delivery and performance of this Agreement will not
result, in (i) a material violation of MST's Declaration or
By-Laws or of any agreement, indenture, instrument, contract,
lease or other undertaking to which MST, on behalf of the
Acquiring Fund, is a party or by which it is bound, or (ii) the
acceleration of any material obligation, or the imposition of
any material penalty, under any agreement, indenture, instrument,
contract, lease, judgment or decree to which MST, on behalf of
the Acquiring Fund, is a party or by which it is bound;
(f) No litigation or administrative proceeding or investigation of
or before any court or governmental body is presently pending or,
to its knowledge, threatened against MST, with respect to the
Acquiring Fund or any of the Acquiring Fund's properties or
assets, that, if adversely determined, would materially and
adversely affect the Acquiring Fund's financial condition or the
conduct of its business. MST, on behalf of the Acquiring Fund,
knows of no facts which might form the basis for the institution
of such proceedings and is not a party to or subject to the
provisions of any order, decree or judgment of any court or
governmental body which materially and adversely affects the
Acquiring Fund's business or its ability to consummate the
transactions herein contemplated;
(g) The Statement of Assets and Liabilities, Statements of
Operations and Changes in Net Assets and Schedule of Investments
of the Acquiring Fund at June 30, 2010 have been audited by
Ernst & Young LLP, Independent Registered Public Accounting Firm,
and are in accordance with GAAP consistently applied, and such
statements present fairly, in all material respects, the financial
condition of the Acquiring Fund as of such date in accordance
with GAAP, and there are no known contingent liabilities of the
Acquiring Fund required to be reflected on a balance sheet
(including the notes thereto) in accordance with GAAP as of such
date not disclosed therein;
(h) Since June 30, 2010, there has not been any material
adverse change in the Acquiring Fund's financial condition,
assets, liabilities or business, other than changes occurring
in the ordinary course of business, or any incurrence by the
Acquiring Fund of indebtedness other than in the ordinary course
in accordance with the Acquiring Fund's investment restrictions.
For purposes of this subparagraph (h), a decline in net asset
value per share of the Acquiring Fund Shares due to declines
in market values of securities held by the Acquiring Fund, the
discharge of Acquiring Fund liabilities, or the redemption of
Acquiring Fund Shares by shareholders of the Acquiring Fund,
shall not constitute a material adverse change;
(i) On the Closing Date, all federal and other tax returns,
dividend reporting forms, and other tax-related reports of the
Acquiring Fund required by law to have been filed by such date
(including any extensions) shall have been filed and are or will
be correct in all material respects, and all federal and other
taxes shown as due or required to be shown as due on said returns
and reports shall have been paid or provision shall have been made
for the payment thereof, and to the best knowledge of MST, no such
return is currently under audit and no assessment has been
asserted with respect to such returns;
(j) For each taxable year of its operation (including the
taxable year that includes the Closing Date), the Acquiring Fund
has met (or will meet) the requirements of Subchapter M of the
Code for qualification as a regulated investment company, has been
eligible to (or will be eligible to) and has computed (or will
compute) its federal income tax under Section 852 of the Code, and
has distributed all of its investment company taxable income and
net capital gain (as defined in the Code) for periods ending prior
to the Closing Date;
(k) All issued and outstanding Acquiring Fund Shares are, and
on the Closing Date will be, duly authorized and validly issued
and outstanding, fully paid and non-assessable by MST and have
been offered and sold in every state, territory and the District
of Columbia in compliance in all material respects with
applicable registration requirements of the 1933 Act and other
applicable federal and state securities laws. The Acquiring Fund
does not have outstanding any options, warrants or other rights
to subscribe for or purchase any Acquiring Fund Shares, nor is
there outstanding any security convertible into any Acquiring
Fund Shares;
(l) The execution, delivery and performance of this Agreement,
and the transactions contemplated herein, have been duly
authorized by all necessary action, if any, on the part of the
Trustees of MST, on behalf of the Acquiring Fund, and this
Agreement constitutes a valid and binding obligation of MST, on
behalf of the Acquiring Fund, enforceable in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting
creditors' rights and to general equity principles;
(m) The Class A, B, C, R, and Y Acquiring Fund Shares to be
issued and delivered to the Acquired Fund, for the account of
the Acquired Fund Shareholders, pursuant to the terms of this
Agreement, will on the Closing Date have been duly authorized and,
when so issued and delivered, will be duly and validly issued
Acquiring Fund Shares, and will be fully paid and non-assessable
by the Acquiring Fund; and
(n) The information to be furnished by the Acquiring Fund for
use in the Registration Statement (as defined in paragraph 5.5)
or other documents filed or to be filed with any federal, state
or local regulatory authority (including the Financial Industry
Regulatory Authority, Inc.), which may be necessary in connection
with the transactions contemplated hereby shall be accurate and
complete in all material respects and shall comply in all
material respects with federal securities and other laws and
regulations applicable thereto.
5. COVENANTS OF THE ACQUIRING FUND AND THE ACQUIRED FUND
5.1. The Acquiring Fund and the Acquired Fund each will operate its
business in the ordinary course between the date hereof and the Closing
Date, it being understood that such ordinary course of business will
include the declaration and payment of customary dividends and
distributions, and any other distribution that may be advisable.
5.2. The Acquired Fund will (a) send appropriate notification to its
shareholders of the Acquired Fund regarding the transactions
contemplated by this Agreement and (b) call a meeting of the
shareholders of the Acquired Fund to consider and act upon this
Agreement and to take all other action necessary to obtain approval of
the transactions contemplated herein
5.3. The Acquired Fund covenants that the Class A, B, C, R, and Y
Acquiring Fund Shares to be issued hereunder are not being acquired
for the purpose of making any distribution thereof, other than in
accordance with the terms of this Agreement.
5.4. Subject to the provisions of this Agreement, the Acquiring Fund
and the Acquired Fund each will take, or cause to be taken, all action,
and do or cause to be done, all things reasonably necessary, proper or
advisable to consummate and make effective the transactions contemplated
by this Agreement.
5.5. MST, on behalf of the Acquiring Fund, shall prepare and file a
Registration Statement on Form N-14 in compliance with the 1933 Act,
the 1934 Act and the 1940 Act and the rules and regulations thereunder
with respect to the Reorganization ("Registration Statement"). The
Acquired Fund will provide in a timely manner to MST such information
regarding the Acquired Fund as may be necessary for the preparation of
the Registration Statement.
5.6. The Acquiring Fund and the Acquired Fund each shall use its
reasonable best efforts to fulfill or obtain the fulfillment of the
conditions precedent to effect the transactions contemplated by this
Agreement as promptly as practicable.
5.7. MST II, on behalf of the Acquired Fund, shall execute and deliver
or cause to be executed and delivered all such assignments and other
instruments, and will take or cause to be taken such further action as
may be necessary or desirable in order to (a) vest in and confirm
(i) the title and possession of MST, on behalf of the Acquired Fund,
of the Acquiring Fund Shares to be delivered hereunder, and (ii) the
title and possession of MST, on behalf of the Acquiring Fund, of all
the Assets, and (b) otherwise to carry out the intent and purpose of
this Agreement.
5.8. The Acquiring Fund will use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940 Act and
such of the state blue sky or securities laws as may be necessary in
order to continue its operations after the Closing Date.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUND
The obligations of MST II, on behalf of the Acquired Fund, to consummate
the transactions provided for herein shall be subject, at MST II's
election, to the performance by MST, on behalf of the Acquiring Fund,
of all the obligations to be performed by it hereunder on or before the
Closing Date, and, in addition thereto, the following further conditions:
6.1. All representations and warranties of MST, on behalf of the
Acquiring Fund, contained in this Agreement shall be true and correct
in all material respects as of the date hereof and, except as they may
be affected by the transactions contemplated by this Agreement, as of
the Closing Date, with the same force and effect as if made on and as
of the Closing Date;
6.2. MST, on behalf of the Acquiring Fund, shall have executed and
delivered to the Acquired Fund an Assumption of Liabilities, certified
by an officer of the Acquiring Fund, dated as of the Closing Date,
pursuant to which MST, on behalf of the Acquiring Fund, assumes all
the Liabilities of the Acquired Fund existing on the Valuation Date;
6.3. MST, on behalf of the Acquiring Fund, shall have delivered to the
Acquired Fund a certificate executed by MST's President or Vice
President and its Treasurer or Assistant Treasurer and dated as of
the Closing Date to the effect that the representations and warranties
of MST, on behalf of the Acquiring Fund, made in this Agreement are
true and correct at and as of the Closing Date, except as they may be
affected by the transactions contemplated by this Agreement;
6.4. MST, on behalf of the Acquiring Fund, shall have performed all of
the covenants and complied with all of the provisions required by this
Agreement to be performed or complied with by MST, on behalf of the
Acquiring Fund, on or before the Closing Date; and
6.5. The number of full and fractional Class A, B, C, R, and Y Acquiring
Fund Shares to be issued in connection with the Reorganization shall
have been calculated in accordance with paragraph 1.1.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND
The obligations of MST, on behalf of the Acquiring Fund, to complete the
transactions provided for herein shall be subject, at MST's election,
to the performance by MST II, on behalf of the Acquired Fund, of all of
the obligations to be performed by it hereunder on or before the Closing
Date and, in addition thereto, the following conditions:
7.1. All representations and warranties of MST II, on behalf of the
Acquired Fund, contained in this Agreement shall be true and correct
in all material respects as of the date hereof and, except as they may
be affected by the transactions contemplated by this Agreement, as of
the Closing Date, with the same force and effect as if made on and as
of the Closing Date;
7.2. MST II shall have delivered to the Acquiring Fund a statement of
the Assets and Liabilities of the Acquired Fund, as of the Closing Date,
certified by the Treasurer of MST II;
7.3. MST II, on behalf of the Acquired Fund, shall have delivered to the
Acquiring Fund a certificate executed in the name of the Acquired Fund
by its President or Vice President and its Treasurer or Assistant
Treasurer and dated as of the Closing Date to the effect that the
representations and warranties of MST II, on behalf of the Acquired
Fund, made in this Agreement are true and correct at and as of the
Closing Date, except as they may be affected by the transactions
contemplated by this Agreement;
7.4. MST II, on behalf of the Acquired Fund, shall have performed all
of the covenants and complied with all of the provisions required by
this Agreement to be performed or complied with by MST II, on behalf
of the Acquired Fund, on or before the Closing Date;
7.5. The number of full and fractional Class A, B, C, R, and Y
Acquiring Fund Shares to be issued in connection with the Reorganization
shall have been calculated in accordance with paragraph 1.1; and
7.6. The Acquired Fund shall have declared and paid a distribution or
distributions prior to the Closing that, together with all previous
distributions, shall have the effect of distributing to its shareholders
(a) all of its investment company taxable income and all of its net
realized capital gains, if any, for the period from the close of its
last fiscal year to 4:00 p.m. Eastern time on the Closing Date; and
(b) any undistributed investment company taxable income and net realized
capital gains from any period to the extent not otherwise already
distributed.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND AND THE
ACQUIRED FUND
If any of the conditions set forth below have not been satisfied on or
before the Closing Date with respect to MST II, on behalf of the
Acquired Fund or MST, on behalf of the Acquiring Fund, the other party
to this agreement may, at its option, refuse to consummate the
transactions contemplated by this Agreement:
8.1. This Agreement and the transactions contemplated herein shall
have been approved by the requisite vote of the holders of the
outstanding shares of the Acquired Fund in accordance with the
provision of the Declaration and by-laws of MST II, applicable state
law and the 1940 Act;
8.2. On the Closing Date no action, suit or other proceeding shall be
pending or, to the knowledge of MST or MST II, threatened before any
court or governmental agency in which it is sought to restrain or
prohibit, or obtain damages or other relief in connection with, this
Agreement or the transactions contemplated herein;
8.3. All consents of other parties and all other consents, orders and
permits of federal, state and local regulatory authorities deemed
necessary by MST and MST II to permit consummation, in all material
respects, of the transactions contemplated hereby shall have been
obtained, except where failure to obtain any such consent, order or
permit would not involve a risk of a material adverse effect on the
assets or properties of the Acquiring Fund or the Acquired Fund;
8.4. The Registration Statement shall have become effective under the
1933 Act and no stop orders suspending the effectiveness thereof shall
have been issued and, to the best knowledge of the parties hereto, no
investigation or proceeding for that purpose shall have been instituted
or be pending, threatened or contemplated under the 1933 Act; and
8.5. MST and MST II shall have received the opinion of Dechert LLP,
counsel to MST and MST II, addressed to MST substantially to the effect
that, based upon certain facts, assumptions and representations, the
transaction contemplated by this Agreement shall constitute a tax-free
reorganization for federal income tax purposes. The delivery of such
opinion is conditioned upon receipt by Dechert LLP, counsel to MST and
to MST II, of representations it shall request of MST and MST II.
Notwithstanding anything herein to the contrary, MST and MST II may not
consummate the transactions contemplated by this Agreement if this
condition is not satisfied.
9. INDEMNIFICATION
9.1. MST, out of the Acquiring Fund's assets and property (including
any amounts paid to the Acquiring Fund pursuant to any applicable
liability insurance policies or indemnification agreements), agrees to
indemnify and hold harmless the Acquired Fund from and against any and
all losses, claims, damages, liabilities or expenses (including, without
limitation, the payment of reasonable legal fees and reasonable costs
of investigation) to which the Acquired Fund may become subject, insofar
as such loss, claim, damage, liability or expense (or actions with
respect thereto) arises out of or is based on any breach by the
Acquiring Fund of any of its representations, warranties, covenants or
agreements set forth in this Agreement, provided that such
indemnification by the Acquiring Fund is not in violation of any
applicable law.
9.2. MST II, out of the Acquired Fund's assets and property (including
any amounts paid to the Acquired Fund pursuant to any applicable
liability insurance policies or indemnification agreements), agrees
to indemnify and hold harmless the Acquiring Fund from and against any
and all losses, claims, damages, liabilities or expenses (including,
without limitation, the payment of reasonable legal fees and reasonable
costs of investigation) to which the Acquiring Fund may become subject,
insofar as such loss, claim, damage, liability or expense (or actions
with respect thereto) arises out of or is based on any breach by the
Acquired Fund of any of its representations, warranties, covenants or
agreements set forth in this Agreement, provided that such
indemnification by the Acquired Fund is not in violation of any
applicable law.
10. BROKERAGE FEES AND EXPENSES
10.1. MST, on behalf of the Acquiring Fund, and MST II, on behalf of
the Acquired Fund, represent and warrant that there are no brokers or
finders entitled to receive any payments in connection with the
transactions provided for herein, other than any brokerage fees and
expenses in connection with the Reorganization as set forth in
paragraph 10.2.
10.2. The expenses relating to the proposed Reorganization will be
borne solely by MCM. No such expenses shall be borne by the Acquired
Fund or the Acquiring Fund, except for brokerage fees and expenses
incurred in connection with the Reorganization. The costs of the
Reorganization shall include, but not be limited to, costs associated
with obtaining any necessary order of exemption from the 1940 Act, if
any, legal fees, accounting fees, and securities registration fees.
Notwithstanding any of the foregoing, expenses will in any event be
paid by the party directly incurring such expenses if and to the extent
that the payment by another person of such expenses would result in the
disqualification of such party as a "regulated investment company"
within the meaning of Section 851 of the Code.
11. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
11.1. MST, on behalf of the Acquiring Fund, and MST II, on behalf of
the Acquired Fund, agree that neither party has made any
representation, warranty or covenant not set forth herein, and this
Agreement constitutes the entire agreement between the Acquiring Fund
and the Acquired Fund with respect to the Reorganization.
11.2. The representations, warranties and covenants contained in this
Agreement or in any document delivered pursuant hereto or in connection
herewith shall survive the consummation of the transactions contemplated
hereunder. The covenants to be performed after the Closing and the
obligations of the Acquired Fund and Acquiring Fund in Sections 9.1 and
9.2 shall survive the Closing.
12. TERMINATION
This Agreement may be terminated and the transactions contemplated
hereby may be abandoned by resolution of MST's Board of Trustees or
MST II's Board of Trustees, at any time prior to the Closing Date, if
circumstances should develop that, in its opinion, make proceeding with
the Agreement inadvisable.
13. AMENDMENTS
This Agreement may be amended, modified or supplemented in such
manner as may be deemed necessary or advisable by the authorized
officers of MST and the officers of MST II.
14. HEADINGS; GOVERNING LAW; ASSIGNMENT; LIMITATION OF LIABILITY
14.1. The Article and paragraph headings contained in this Agreement
are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
14.2. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware without regard to its principles
of conflicts of laws.
14.3. This Agreement shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns, but no assignment
or transfer hereof or of any rights or obligations hereunder shall be
made by any party without the written consent of the other party.
Nothing herein expressed or implied is intended or shall be construed
to confer upon or give any person, firm or corporation, other than the
parties hereto and their respective successors and assigns, any rights
or remedies under or by reason of this Agreement.
14.4. This Agreement may be executed in any number of counterparts,each
of which, when executed and delivered, shall be deemed to be an
original.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed by a duly authorized officer.
MUNDER SERIES TRUST II, on behalf of the Munder Healthcare Fund
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
Xxxxxxx X. Xxxxxxxxxxx
Vice President and Secretary
MUNDER SERIES TRUST, on behalf of the Munder Growth Opportunities Fund
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
Xxxxxxx X. Xxxxxxxxxxx
Vice President and Secretary
With respect to Paragraph 10.2 of this Agreement, Accepted and Acknowledged by:
MUNDER CAPITAL MANAGEMENT
By: /s/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
Managing Director, Chief Financial Officer
00000000.0.XXXXXXXX
See Section 1.1. Class K shares of the Acquired Fund shall be deemed
to correspond to Class A shares of the Acquired Fund.
17
