Exhibit 4(b)
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION ("Agreement") is made as of this
20th day of October, 2003, by and between Xxxxx Xxxxx Growth Trust, a
Massachusetts business trust ("Growth Trust"), on behalf of its series Xxxxx
Xxxxx Small-Cap Fund ("EV Fund"), and Growth Trust, on behalf of its series
Atlanta Capital Small-Cap Fund ("AC Fund").
WITNESSETH:
WHEREAS, Growth Trust is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management investment company
authorized to issue an unlimited number of shares of beneficial interest without
par value in one or more series (such as EV and AC Funds).
WHEREAS, the Trustees of Growth Trust are authorized to establish one or
more classes of shares of a series and, in the case of EV Fund, have established
a single class of shares ("EV Fund Shares") and, in the case of AC Fund, have
established multiple classes of shares, including Class A shares (such Class A
shares referred to herein as "AC Fund Shares").
WHEREAS, EV Fund and AC Fund currently invest all of their assets in
Small-Cap Portfolio ("Small-Cap Portfolio" or the "Portfolio"), a New York trust
registered under the 1940 Act as an open-end management investment company;
WHEREAS, Boston Management and Research, a wholly owned subsidiary of Xxxxx
Xxxxx Management, serves as investment adviser to Small-Cap Portfolio;
WHEREAS, Growth Trust desires to provide for the reorganization of EV Fund
through the acquisition by AC Fund of substantially all of the assets of EV Fund
in exchange for AC Fund Shares in the manner set forth herein and AC Fund's
assumption of all of the liabilities of EV Fund; and
WHEREAS, it is intended that the reorganization described in this Agreement
shall be a reorganization within the meaning of Section 368 of the Internal
Revenue Code of 1986, as amended (the "Code");
NOW, THEREFORE, in consideration of the mutual promises herein contained,
the parties hereto agree as follows:
1. DEFINITIONS
-----------
1.1 The term "1933 ACT" shall mean the Securities Act of 1933, as amended.
1.2 The term "1934 ACT" shall mean the Securities Exchange Act of 1934, as
amended.
1.3 The term "AGREEMENT" shall mean this Agreement and Plan of
Reorganization.
1.4 The term "ASSUMED LIABILITIES" shall mean all liabilities, expenses,
costs, charges, receivables and payables of EV Fund as of the Close of
Trading on the New York Stock Exchange on the Valuation Date.
1.5 The term "BUSINESS DAY" shall mean any day that is not a Saturday or
Sunday and that the New York Stock Exchange is open.
1.6 The term "CLOSE OF TRADING ON THE NYSE" shall mean the close of
regular trading, which is usually 4:00 p.m. Eastern time.
1.7 The term "CLOSING" shall mean the closing of the transaction
contemplated by this Agreement.
1.8 The term "CLOSING DATE" shall mean the first Monday following receipt
of all necessary regulatory approvals or such other date as may be
agreed by the parties on which the Closing is to take place.
1.9 The term "COMMISSION" shall mean the Securities and Exchange
Commission.
1.10 The term "CUSTODIAN" shall mean Investors Bank & Trust Company.
1.11 The term "DELIVERY DATE" shall mean the date contemplated by Section
3.3 of this Agreement.
1.12 The term "INFORMATION STATEMENT" shall mean the combined prospectus
and information statement furnished to the EV Fund shareholders in
connection with this transaction.
1.13 The term "GROWTH TRUST N-1A" shall mean the registration statement, as
amended, on Form N-1A of Growth Trust with respect to the Funds in
effect on the date hereof or on the Closing Date, as the context may
require.
1.14 The term "GROWTH TRUST N-14" shall mean Growth Trust's registration
statement on Form N-14, as may be amended, that describes the
transactions contemplated by this Agreement and registers the AC Fund
Shares to be issued in connection with the transactions.
1.15 The term "NYSE" shall mean the New York Stock Exchange.
1.16 The term "VALUATION DATE" shall mean the Closing Date.
2. TRANSFER AND EXCHANGE OF ASSETS
-------------------------------
2.1 TRANSFER OF ASSETS OF EV FUND. At the Closing, Growth Trust shall
transfer all of the assets of EV Fund and assign all Assumed
Liabilities to AC Fund, and AC Fund shall acquire such assets and
shall assume such Assumed Liabilities upon delivery by AC Fund to EV
Fund on the Closing Date of AC Fund Shares (including, if applicable,
fractional shares) having an aggregate net asset value equal to the
value of the assets so transferred, assigned and delivered, less the
Assumed Liabilities, all determined and adjusted as provided in
Section 2.2. Upon delivery of the assets, AC Fund will receive good
and marketable title thereto free and clear of all liens.
2
2.2 COMPUTATION OF NET ASSET VALUE. The net asset value per share of the
AC Fund Shares and the net value of the assets of EV Fund subject to
this Agreement shall, in each case, be determined as of the Close of
Trading on the NYSE on the Valuation Date, after the declaration and
payment of any dividend on that date. The net asset value of the AC
Fund Shares shall be computed in the manner set forth in the Growth
Trust Form N-1A.
In determining the value of the assets transferred by EV Fund to AC
Fund, such assets shall be priced in accordance with the policies and
procedures described in the Growth Trust N-1A. All such computations
shall be subject to review, in the discretion of Growth Trust's
Treasurer, by Deloitte & Touche LLP, Growth Trust's auditors.
3. CLOSING DATE, VALUATION DATE AND DELIVERY
-----------------------------------------
3.1 CLOSING DATE. The Closing shall be at the offices of Xxxxx Xxxxx
Management, The Xxxxx Xxxxx Building, 000 Xxxxx Xxxxxx, Xxxxxx, XX
00000 immediately prior to the opening of Xxxxx Xxxxx'x business on
the Closing Date. All acts taking place at Closing shall be deemed to
take place simultaneously as of 5:00 p.m. Eastern time on the Closing
Date unless otherwise agreed in writing by the parties.
3.2 VALUATION DATE. Pursuant to Section 2.2, the net value of the assets
of EV Fund and the net asset value per share of AC Fund Shares shall
be determined as of the Close of Trading on the NYSE on the Valuation
Date, after the declaration and payment of any dividend on that date.
The stock transfer books of Growth Trust with respect to EV Fund will
be permanently closed, and sales of EV Fund Shares shall be suspended,
as of the close of business of Growth Trust on the Valuation Date.
Redemption requests thereafter received by Growth Trust with respect
to EV Fund shall be deemed to be redemption requests for AC Fund
Shares to be distributed to shareholders of EV Fund under this
Agreement provided that the transactions contemplated by this
Agreement are consummated.
In the event that trading on the NYSE or on another exchange or market
on which securities held by Small-Cap Portfolio shall be disrupted on
the Valuation Date so that, in the judgment of Growth Trust, accurate
appraisal of the net assets of EV Fund to be transferred hereunder or
the assets of AC Fund is impracticable, the Valuation Date shall be
postponed until the first Business Day after the day on which trading
on such exchange or in such market shall, in the judgment of Growth
Trust, have been resumed without disruption. In such event, the
Closing Date shall be postponed until one Business Day after the
Valuation Date.
3.3 DELIVERY OF ASSETS. After the close of business on the Valuation Date,
Growth Trust shall issue instructions providing for the delivery of
all assets of EV Fund to the Custodian to be held for the account of
AC Fund, effective as of the Closing.
4. EV FUND DISTRIBUTIONS AND TERMINATION
-------------------------------------
As soon as reasonably practicable after the Closing Date, Growth Trust
shall pay or make provisions for the payment of the remaining debts and
taxes, if any, of EV Fund and distribute all remaining assets, if any, to
shareholders of EV Fund, and EV Fund shall thereafter be terminated under
Massachusetts law.
At, or as soon as may be practicable following the Closing Date, Growth
Trust on behalf of EV Fund shall distribute the AC Fund Shares it received
from the AC Fund to the shareholders of the EV Fund and shall instruct AC
3
Fund as to the amount of the pro rata interest of each of EV Fund's
shareholders as of the close of business on the Valuation Date (such
shareholders to be certified as such by the transfer agent for Growth
Trust), to be registered on the books of AC Fund, in full and fractional AC
Fund Shares, in the name of each such shareholder, and AC Fund agrees
promptly to transfer the AC Fund Shares then credited to the account of EV
Fund on the books of AC Fund to open accounts on the share records of AC
Fund in the names of EV Fund shareholders in accordance with said
instruction. All issued and outstanding EV Fund Shares shall thereupon be
canceled on the books of Growth Trust. AC Fund shall have no obligation to
inquire as to the correctness of any such instruction, but shall, in each
case, assume that such instruction is valid, proper and correct. As soon as
reasonably practicable, but in all events within six months after the
Closing Date, the status of EV Fund as a designated series of shares of
Growth Trust shall be terminated, provided, however, that such termination
shall not be required if this reorganization is not consummated.
5. LIABILITIES AND EXPENSES
------------------------
AC Fund shall acquire all liabilities of EV Fund, whether known or unknown,
or contingent or determined existing as of the Closing Date. Growth Trust
will discharge all known liabilities of EV Fund, so far as may be possible,
prior to the Closing Date. EV Fund and AC Fund shall bear their respective
expenses, in connection with carrying out this Agreement.
6. SMALL-CAP PORTFOLIO'S REPRESENTATIONS AND WARRANTIES
----------------------------------------------------
The Small-Cap Portfolio hereby represents, warrants and agrees as follows:
6.1 LEGAL EXISTENCE. The Portfolio is a trust duly organized and validly
existing under the laws of the State of New York.
6.2 REGISTRATION UNDER 1940 ACT. The Portfolio is duly registered with the
Commission as an open-end management investment company under the 1940
Act and such registration is in full force and effect.
6.3 FINANCIAL STATEMENTS. The statement of assets and liabilities,
schedule of portfolio investments and related statements of operations
and changes in net assets dated September 30, 2002 (audited) and March
31, 2003 (unaudited) fairly present the financial condition of the
Portfolio as of said dates in conformity with generally accepted
accounting principles.
6.4 NO MATERIAL EVENTS. There are no legal, administrative or other
proceedings pending, or to its knowledge, threatened against the
Portfolio that would materially affect its financial condition.
6.5 REQUISITE APPROVALS. The execution and delivery of this Agreement and
the consummation of the transactions contemplated herein have been
authorized by the Portfolio's Board of Trustees by vote taken at a
meeting of such Board duly called and held on October 20, 2003.
6.6 NO MATERIAL VIOLATIONS. The Portfolio is not, and the execution,
delivery and performance of this Agreement will not result, in a
material violation of any provision of its Declaration of Trust or
By-Laws, as each may be amended, or of any agreement, indenture,
instrument, contract, lease or other undertaking to which it is a
party or by which it is bound.
4
6.7 TAXES AND RELATED FILINGS. Except where failure to do so would not
have a material adverse effect on the Portfolio, the Portfolio has
filed and will file or obtain valid extensions of filing dates for all
required federal, state and local tax returns and reports for all
taxable years through and including the taxable year ended September
30, 2003 and no such filings or reports are currently being audited or
contested by the Internal Revenue Service or state or local taxing
authority and all federal, state and local income, franchise,
property, sales, employment or other taxes or penalties payable have
been paid or will be paid, so far as due. The Portfolio is classified
as a partnership for federal tax purposes, has qualified as such for
each taxable year of its operations, and will qualify as such as of
the Closing Date.
6.8 GOOD AND MARKETABLE TITLE. On the Closing Date, the Portfolio will
have good and marketable title to its assets, free and clear of all
liens, mortgages, pledges, encumbrances, charges, claims and equities
whatsoever.
6.9 BOOKS AND RECORDS. The Portfolio has maintained all records required
under Section 31 of the 1940 Act and rules thereunder.
7. GROWTH TRUST'S REPRESENTATIONS AND WARRANTIES
---------------------------------------------
Growth Trust, on behalf of each of EV Fund and AC Fund, hereby represents,
warrants and agrees as follows:
7.1 LEGAL EXISTENCE. Growth Trust is a business trust duly organized and
validly existing under the laws of the Commonwealth of Massachusetts.
Each of EV Fund and AC Fund is a validly existing series of Growth
Trust. Growth Trust is authorized to issue an unlimited number of
shares of beneficial interest of AC Fund.
7.2 REGISTRATION UNDER 1940 ACT. Growth Trust is duly registered as an
open-end management investment company under the 1940 Act and such
registration is in full force and effect.
7.3 FINANCIAL STATEMENTS. The statement of assets and liabilities and the
schedule of portfolio investments and the related statements of
operations and changes in net assets of EV Fund and AC Fund dated
September 30, 2002 (audited) and March 31, 2003 (unaudited), fairly
present the financial condition of EV Fund and AC Fund as of said
dates in conformity with generally accepted accounting principles and
there have been no material adverse changes since the dates thereof.
7.4 NO CONTINGENT LIABILITIES. There are no known contingent liabilities
of EV Fund or AC Fund not disclosed and there are no legal,
administrative or other proceedings pending, or to the knowledge of
Growth Trust, threatened, against either of EV Fund or AC Fund that
would materially affect its financial condition.
7.5 REQUISITE APPROVALS. The execution and delivery of this Agreement and
the consummation of the transactions contemplated herein, have been
authorized by the Board of Trustees of Growth Trust by vote taken at a
meeting of such Board duly called and held on October 20, 2003. No
approval of the shareholders of either Fund is required in connection
with this Agreement or the transactions contemplated hereby. The
Agreement has been executed and delivered by a duly authorized officer
5
of Growth Trust and is a valid and legally binding obligation of each
of AC Fund and EV Fund enforceable in accordance with its terms.
7.6 NO MATERIAL VIOLATIONS. Growth Trust is not, and the execution,
delivery and performance of this Agreement will not result, in a
material violation of any provision of its Declaration of Trust or
By-Laws, as each may be amended, or of any agreement, indenture,
instrument, contract, lease or other undertaking to which Growth Trust
is a party or by which it is bound.
7.7 TAXES AND RELATED FILINGS. Except where failure to do so would not
have a material adverse effect on EV Fund or AC Fund (i) each of EV
Fund and AC Fund has filed or will file (or has obtained valid
extensions of filing dates for) all required federal, state and local
tax returns and reports for all taxable years through the taxable year
ended September 30, 2003 and no such filings are currently being
audited or contested by the Internal Revenue Service or state or local
taxing authority; and (ii) all federal, state and local income,
franchise, property, sales, employment or other taxes or penalties
payable pursuant to such returns have been paid or will be paid, so
far as due. Each of EV Fund and AC Fund has elected to be treated as a
"regulated investment company" under Section 851 and 852 of the Code,
has qualified as such for each taxable year of its operations and will
qualify as such as of the Closing Date.
7.8 GROWTH TRUST N-1A NOT MISLEADING. The Growth Trust N-1A conforms on
the date of the Agreement, and will conform on the Closing Date, 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 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.
8. CONDITIONS PRECEDENT TO CLOSING
-------------------------------
The obligations of the parties hereto shall be conditioned on the
following:
8.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties of
the parties made herein will be true and correct as of the date of
this Agreement and on the Closing Date.
8.2 PENDING OR THREATENED PROCEEDINGS. On the Closing Date, no action,
suit or other proceeding shall be threatened or pending 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 REGISTRATION STATEMENT. The Growth Trust N-14 shall have become
effective under the 1933 Act; no stop orders suspending the
effectiveness of such Growth Trust N-14 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. The Information
Statement shall have been delivered to each shareholder of record of
EV's Fund in accordance with the provisions of applicable law.
8.4 DECLARATION OF DIVIDEND. Growth Trust shall have declared a dividend
or dividends, which, together with all previous such dividends, shall
have the effect of distributing to EV Fund shareholders all of EV
Fund's investment company taxable income (as defined in Section 852 of
6
the Code) (computed without regard to any deduction for dividends
paid) for the final taxable period of EV Fund, all of its net capital
gain realized in the final taxable period of EV Fund (after reduction
for any capital loss carryforward) and all of the excess of (i) its
interest income excludable from gross income under Section 103(a) of
the Code over (ii) its deductions disallowed under Sections 265 and
171(a)(2) of the Code for the final taxable period of EV Fund.
8.5 STATE SECURITIES LAWS. The parties shall have received all permits and
other authorizations necessary under state securities laws to
consummate the transactions contemplated herein.
8.6 PERFORMANCE OF COVENANTS. Each party shall have performed and complied
in all material respects with each of the agreements and covenants
required by this Agreement to be performed or complied with by each
such party prior to or at the Valuation Date and the Closing Date.
8.7 DUE DILIGENCE. Growth Trust shall have had reasonable opportunity to
have its officers and agents review the records of Small-Cap
Portfolio.
8.8 NO MATERIAL ADVERSE CHANGE. From the date of this Agreement, through
the Closing Date, there shall not have been:
(1) any change in the business, results of operations, assets or
financial condition or the manner of conducting the business of
EV Fund or AC Fund (other than changes in the ordinary course of
its business, including, without limitation, dividends and
distributions in the ordinary course and changes in the net asset
value per share) which has had a material adverse effect on such
business, results of operations, assets or financial condition,
except in all instances as set forth in the financial statements;
(2) any loss (whether or not covered by insurance) suffered by EV
Fund or AC Fund materially and adversely affecting EV Fund or AC
Fund, other than depreciation of securities;
(3) issued by Growth Trust to any person any option to purchase or
other right to acquire shares of any class of EV Fund or AC Fund
Shares (other than in the ordinary course of Growth Trust's
business as an open-end management investment company);
(4) any indebtedness incurred by Small-Cap Portfolio for borrowed
money or any commitment to borrow money entered into by Small-Cap
Portfolio except as permitted in Growth Trust N-1A and disclosed
in financial statements required to be provided under this
Agreement;
(5) any amendment to the Declaration of Trust or By-Laws of Growth
Trust that will adversely affect the ability of Growth Trust to
comply with the terms of this Agreement; or
(6) any grant or imposition of any lien, claim, charge or encumbrance
upon any asset of Small-Cap Portfolio except as provided in the
Growth Trust N-1A so long as it will not prevent Growth Trust
from complying with Section 7.8.
7
8.11 LAWFUL SALE OF SHARES. On the Closing Date, AC Fund Shares to be
issued pursuant to Section 2.1 of this Agreement will be duly
authorized, duly and validly issued and outstanding, and fully paid
and non-assessable by Growth Trust, and conform in all substantial
respects to the description thereof contained in the Growth Trust N-14
and Information Statement furnished to the EV Fund shareholders, and
the AC Fund Shares to be issued pursuant to paragraph 2.1 of this
Agreement will be duly registered under the 1933 Act by the Growth
Trust N-14 and will be offered and sold in compliance with all
applicable state securities laws.
8.12 DOCUMENTATION AND OTHER ACTIONS. Growth Trust shall have executed such
documents and shall have taken such other actions, if any, as
reasonable requested to fully effectuate the transactions contemplated
hereby.
9. ADDRESSES
---------
All notices required or permitted to be given under this Agreement shall be
given in writing to Xxxxx Xxxxx Growth Trust, The Xxxxx Xxxxx Building, 000
Xxxxx Xxxxxx, Xxxxxx, XX 00000 (Attention: Secretary), or at such other
place as shall be specified in written notice given by either party to the
other party to this Agreement and shall be validly given if mailed by
first-class mail, postage prepaid.
10. TERMINATION
-----------
This Agreement may be terminated by either party upon the giving of written
notice to the other, if any of the representations, warranties or
conditions specified in Section 6, 7 or 8 hereof have not been performed or
do not exist on or before January 30, 2004. In the event of termination of
this Agreement pursuant to this provision, neither party (nor its officers,
Trustees or shareholders) shall have any liability to the other.
11. MISCELLANEOUS
-------------
This Agreement shall be governed by, construed and enforced in accordance
with the laws of the Commonwealth of Massachusetts. Growth Trust represents
that there are no brokers or finders entitled to receive any payments in
connection with the transactions provided for herein. Growth Trust
represents that this Agreement constitutes the entire agreement between the
parties as to the subject matter hereof. The representations, warranties
and covenants contained in this Agreement or in any document delivered
pursuant hereto or in connection herewith shall not survive the
consummation of the transactions contemplated hereunder. The section
headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this
Agreement. This Agreement shall be executed in any number of counterparts,
each of which shall be deemed an original. Whenever used herein, the use of
any gender shall include all genders. In the event that any provision of
this Agreement is unenforceable at law or in equity, the remainder of the
Agreement shall remain in full force and effect.
12. PUBLICITY
---------
Any announcements or similar publicity with respect to this Agreement or
the transactions contemplated herein will be made at such time and in such
manner as Growth Trust shall determine.
8
13. AMENDMENTS
----------
At any time (i) the parties hereto may, by written agreement and without
shareholder approval, amend any of the provisions of this Agreement, and
(ii) either party may waive without such approval any default by the other
party or the failure to satisfy any of the conditions to its obligations
(such waiver to be in writing). The failure of a party hereto to enforce at
any time any of the provisions of this Agreement shall in no way be
construed to be a waiver of any such provision, nor in any way to affect
the validity of this Agreement or any part hereof or the right of any party
thereafter to enforce each and every such provision. No waiver of any
breach of this Agreement shall be held to be a waiver of any other or
subsequent breach.
14. MASSACHUSETTS BUSINESS TRUST
----------------------------
References in this Agreement to Growth Trust mean and refer to the
Trustees, from time to time serving under its Declarations of Trust on file
with the Secretary of the Commonwealth of Massachusetts, as the same may be
amended from time to time, pursuant to which they conduct their businesses.
It is expressly agreed that the obligations of Growth Trust hereunder shall
not be binding upon any of the trustees, shareholders, nominees, officers,
agents or employees of the Trust personally, but bind only the trust
property of the Trust as provided in said Declaration of Trust. The
execution and delivery of this Agreement has been authorized by the
respective trustees and signed by an authorized officer of Growth Trust,
acting as such, and neither such authorization by such trustees nor such
execution and delivery by such officer shall be deemed to have been made by
any of them, but shall bind only the trust property of the Trust as
provided in such Declaration of Trust. No series of Growth Trust shall be
liable for the obligations of any other series.
9
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed and its seal affixed hereto by their officers thereunto duly
authorized, as of the day and year first above written.
ATTEST: XXXXX XXXXX GROWTH TRUST
(on behalf of Xxxxx Xxxxx Small-Cap Fund)
/s/ Xxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxx Xx.
------------------------ -----------------------------------
Secretary President
XXXXX XXXXX GROWTH TRUST
(on behalf of Atlanta Capital Small-Cap
Fund)
/s/ Xxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxx Xx.
------------------------ -----------------------------------
Secretary President
SMALL-CAP PORTFOLIO
/s/ Xxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxxx
------------------------ -----------------------------------
Secretary President
(For purposes of Section 6 only)
