BB&T VARIABLE INSURANCE FUNDS
BB&T Large Cap Growth VIF and
BB&T Large Cap VIF
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization, having been
approved by the Board of Trustees of BB&T Variable Insurance
Funds, is made as of December 5, 2006 between BB&T Variable
Insurance Funds, on behalf of BB&T Large Cap Growth VIF and BB&T
Large Cap VIF, and BB&T Asset Management, Inc. (the "Plan").
The capitalized terms used herein shall have the meaning
ascribed to them in this Plan.
1. Overview of Plan of Reorganization
(a) The BB&T Large Cap Growth VIF ("Large Cap Growth VIF")
will sell, assign, convey, transfer and deliver to BB&T Large
Cap VIF ("Large Cap VIF"), and Large Cap VIF will acquire, on
the Exchange Date, all of the properties and assets existing at
the Valuation Time in Large Cap Growth VIF, subject to
liabilities.
In consideration therefor, Large Cap VIF shall, on the
Exchange Date, assume all of the liabilities of Large Cap Growth
VIF existing at the Valuation Time and transfer to Large Cap
Growth VIF a number of full and fractional units of beneficial
interest ("Shares") of Large Cap VIF having an aggregate net
asset value equal to the value of the assets of Large Cap Growth
VIF transferred to Large Cap VIF on such date less the value of
all of the liabilities of Large Cap Growth VIF assumed by Large
Cap VIF on that date. It is intended that the reorganization
described in this Plan shall be a tax-free reorganization under
Section 368 of the Internal Revenue Code of 1986, as amended
(the "Code").
(b) Upon consummation of the transaction described in
paragraph 1(a) of this Plan, Large Cap Growth VIF in complete
liquidation shall distribute to its respective shareholders of
record as of the Exchange Date the Large Cap VIF Shares received
by it, each shareholder being entitled to receive that number of
such Large Cap VIF Shares equal to the total of (i) the
proportion which the number of Shares of Large Cap Growth VIF
held by such shareholder bears to the number of such Shares of
Large Cap Growth VIF outstanding on such date multiplied by (ii)
the total number of Large Cap VIF Shares received by the Large
Cap Growth VIF, as of the Exchange Date. Large Cap Growth VIF
shareholders of record will receive Shares of Large Cap VIF.
2. Representations and Warranties of BB&T Variable Insurance
Funds. Each of BB&T Variable Insurance Funds, Large Cap VIF and
Large Cap Growth VIF warrant to and agree that:
(a) BB&T Variable Insurance Funds is a business trust duly
established and validly existing under the laws of The
Commonwealth of Massachusetts and has power to carry on its
business as it is now being conducted and to carry out this
Plan. Each of BB&T Variable Insurance Funds, Large Cap Growth
VIF and Large Cap VIF is not required to qualify as a foreign
association in any jurisdiction. Each of BB&T Variable
Insurance Funds, Large Cap Growth VIF and Large Cap VIF has all
necessary federal, state and local authorizations to own all of
its properties and assets and to carry on business as now being
conducted and to fulfill the terms of this Plan, except as set
forth in Section 2(i).
(b) BB&T Variable Insurance Funds is registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), as
an open-end management investment company, and such registration
has not been revoked or rescinded and is in full force and
effect.
(c) The statements of assets and liabilities, statements
of operations, statements of changes in net assets and schedules
of investments (indicating their market values) for each of
Large Cap Growth VIF and Large Cap VIF for the year ended
December 31, 2005 and six-month period ended June 30, 2006,
fairly present the financial position of each of Large Cap
Growth VIF and Large Cap VIF as of such date, and said
statements of operations and changes in net assets and financial
highlights fairly reflect the results of operations, changes in
net assets and financial highlights for the periods covered
thereby in conformity with generally accepted accounting
principles.
(d) The prospectuses of each of Large Cap Growth VIF and
Large Cap VIF dated May 1, 2006, as amended, as filed with the
Securities and Exchange Commission (the "Commission") (the
"Prospectuses") and the Statement of Additional Information for
BB&T Variable Insurance Funds, dated May 1, 2006, as amended
(the "Statement of Additional Information"), as filed with the
Commission, did not as of such date, and will not as of the
Exchange Date, contain any untrue statement of a material fact
or omit to state a 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 misleading.
(e) There are no material legal, administrative or other
proceedings pending or, to the knowledge of BB&T Variable
Insurance Funds, Large Cap Growth VIF or Large Cap VIF, overtly
threatened against BB&T Variable Insurance Funds, Large Cap
Growth VIF or Large Cap VIF, which assert liability on the part
of BB&T Variable Insurance Funds, Large Cap Growth VIF or Large
Cap VIF.
(f) There are no material contracts outstanding to which
BB&T Variable Insurance Funds, Large Cap Growth VIF or Large Cap
VIF is a party, other than as disclosed in BB&T's Prospectuses
and Statement of Additional Information or in the Registration
Statement.
(g) Large Cap Growth VIF has no known liabilities of a
material nature, contingent or otherwise, other than those shown
on its statement of assets and liabilities as of June 30, 2006,
referred to above and those incurred in the ordinary course of
the business of BB&T Variable Insurance Funds as an investment
company or Large Cap Growth VIF since such date. Prior to the
Exchange Date, Large Cap Growth VIF will advise Large Cap VIF of
all known material liabilities, contingent or otherwise,
incurred by it subsequent to June 30, 2006, whether or not
incurred in the ordinary course of business.
(h) As of the Exchange Date, BB&T Variable Insurance Funds
and each of Large Cap Growth VIF and Large Cap VIF will have
filed all federal and other tax returns which, to the knowledge
of BB&T Variable Insurance Funds' officers, have been required
to be filed by Large Cap Growth VIF or Large Cap VIF,
respectively, and will have paid or will pay all federal and
other taxes shown to be due on such returns or on any
assessments received by Large Cap Growth VIF or Large Cap VIF,
respectively. As of the Exchange Date, to such officers'
knowledge, each of Large Cap Growth VIF and Large Cap VIF (i)
will have adequately provided for all tax liabilities on its
books, (ii) will not have had any tax deficiency or liability
asserted against it, or question with respect thereto raised,
and (iii) will not be under audit by the Internal Revenue
Service or by any state or local tax authority for taxes in
excess of those already paid.
(i) As used in this Plan, the term "Investments" shall
mean the Large Cap Growth VIF's investments shown on the
schedule of its portfolio investments as of June 30, 2006,
referred to in Section 2(c) hereof, as supplemented with such
changes as BB&T Variable Insurance Funds or the Large Cap Growth
VIF shall make after June 30, 2006, which changes shall be
disclosed to BB&T Variable Insurance Funds and the Large Cap
VIF, and changes resulting from stock dividends, stock split-
ups, mergers and similar corporate actions.
(j) Each of Large Cap Growth VIF and Large Cap VIF has
elected to qualify and has qualified as, and has met the
requirements of subchapter M of the Code for treatment as, a
"regulated investment company" within the meaning of Section 851
of the Code in respect of each taxable year since the
commencement of operations, and will continue to meet such
requirements at all times through the Exchange Date. Neither
Large Cap Growth VIF nor Large Cap VIF has at any time since its
inception been liable (nor is now liable) for any material
income or excise tax pursuant to Section 852 or 4982 of the
Code. Each of Large Cap Growth VIF and Large Cap VIF is in
compliance in all material respects with applicable regulations
of the Internal Revenue Service pertaining to the reporting of
dividends and other distributions on and redemptions of its
capital stock and to withholding in respect of dividends and
other distributions to shareholders, and is not liable for any
material penalties which could be imposed thereunder.
(k) For all taxable years and all applicable quarters of
Large Cap Growth VIF from the date of its inception, the assets
of Large Cap Growth VIF have been sufficiently diversified that
each segregated asset account investing all its assets in Large
Cap Growth VIF was adequately diversified within the meaning of
Section 817(h) of the Code and applicable regulations
thereunder. For all taxable years and all applicable quarters
of Large Cap VIF from the date of its inception, the assets of
Large Cap VIF have been sufficiently diversified that each
segregated asset account investing all its assets in Large Cap
VIF was adequately diversified within the meaning of Section
817(h) of the Code and applicable regulations thereunder.
(l) No consent, approval, authorization or order of any
governmental authority is required for the consummation by BB&T
Variable Insurance Funds, Large Cap Growth VIF or Large Cap VIF
of the transaction contemplated by this Plan, except such as may
be required under the 1933 Act, the 1934 Act, the 1940 Act,
state securities or Blue Sky laws or the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976.
(m) As of both the Valuation Time and the Exchange Date
and otherwise as described in Section 2(i), BB&T Variable
Insurance Funds on behalf of Large Cap VIF will have full right,
power and authority to purchase the Investments and any other
assets and assume the liabilities of Large Cap Growth VIF to be
transferred to Large Cap VIF pursuant to this Plan.
(n) The Registration Statement, the Prospectuses and the
Proxy Statement, on the effective date of the Registration
Statement and insofar as they relate to BB&T Variable Insurance
Funds, Large Cap Growth VIF and Large Cap VIF: (i) will comply
in all material respects with the provisions of the 1933 Act,
the 1934 Act and the 1940 Act and the rules and regulations
thereunder and (ii) will not contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances in which they were made, not
misleading; and at the time of the shareholders' meeting
referred to in Section 8(a) and at the Exchange Date, the
Prospectuses, as amended or supplemented by any amendments or
supplements filed with the Commission by BB&T Variable Insurance
Funds, Large Cap Growth VIF or Large Cap VIF, will not contain
any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances in which
they were made, not misleading; provided, however, that none of
the representations and warranties in this subsection shall
apply to statements in or omissions from the Registration
Statement, the Prospectuses or the Proxy Statement made in
reliance upon and in conformity with information furnished by
Large Cap Growth VIF or Large Cap VIF for use in the
Registration Statement, the Prospectuses or the Proxy Statement.
(o) Large Cap VIF Shares to be issued to each of Large Cap
Growth VIF have been duly authorized and, when issued and
delivered pursuant to this Plan and the Prospectuses, will be
legally and validly issued and will be fully paid and
nonassessable by BB&T Variable Insurance Funds and no
shareholder of BB&T Variable Insurance Funds will have any
preemptive right of subscription or purchase in respect thereof.
(p) The issuance of Large Cap VIF Shares pursuant to this
Plan will be in compliance with all applicable federal and state
securities laws.
3. Reorganization. (a) Subject to the requisite
approval of the shareholders of Large Cap Growth VIF (in respect
of the Large Cap Growth VIF Reorganization, as hereafter
defined) and to the other terms and conditions contained herein
(including Large Cap Growth VIF's obligation described in
Section 9(j) hereof to distribute to its respective shareholders
all of its undistributed investment company taxable income (as
defined in Section 852 of the Code), if any, and net capital
gain (as defined Section 1222 of the Code)), Large Cap Growth
VIF will agree to sell, assign, convey, transfer and deliver to
Large Cap VIF, and Large Cap VIF will agree to acquire from
Large Cap Growth VIF, on the Exchange Date all of the
Investments and all of the cash and other assets of Large Cap
Growth VIF, subject to liabilities, in exchange for that number
of Shares of Large Cap VIF provided for in Section 4 and the
assumption by Large Cap VIF of all of the liabilities of Large
Cap Growth VIF. Pursuant to this Plan, Large Cap Growth VIF
will, as soon as practicable after the Exchange Date, distribute
in liquidation all of the Large Cap VIF Shares received by it to
its shareholders in exchange for their respective Shares of
Large Cap Growth VIF.
(b) BB&T Variable Insurance Funds, on behalf of Large Cap
Growth VIF, will pay or cause to be paid to Large Cap VIF any
interest and cash dividends received by it on or after the
Exchange Date with respect to the Investments transferred to
Large Cap VIF hereunder. BB&T Variable Insurance Funds, on
behalf of Large Cap Growth VIF, will transfer to Large Cap VIF
any rights, stock dividends, or other securities received by
Large Cap Growth VIF after the Exchange Date as stock dividends
or other distributions on or with respect to the Investments
transferred, which rights, stock dividends, and other securities
shall be deemed included in the assets transferred to Large Cap
VIF at the Exchange Date and shall not be separately valued, in
which case any such distribution that remains unpaid as of the
Exchange Date shall be included in the determination of the
value of the assets of Large Cap Growth VIF acquired by Large
Cap VIF.
4. Exchange Date; Valuation Time. On the Exchange Date,
Large Cap VIF will deliver to Large Cap Growth VIF a number of
Large Cap VIF Shares having an aggregate net asset value equal
to the value of the assets attributable to each corresponding
class of Shares of Large Cap Growth VIF acquired by Large Cap
VIF, less the value of the liabilities of Large Cap Growth VIF
assumed, determined as hereafter provided in this Section 4.
(a) Subject to Section 4(d) hereof, the value of Large Cap
Growth VIF's net assets will be computed as of the Valuation
Time using the valuation procedures for Large Cap VIF set forth
in the BB&T Prospectuses and BB&T Statement of Additional
Information. In no event shall the same security held by the
Large Cap Growth VIF and BB&T Variable Insurance Funds be valued
at different prices.
(b) Subject to Section 4(d) hereof, the net asset value of
a Share of Large Cap VIF will be determined to the nearest full
cent as of the Valuation Time, using the valuation procedures
set forth in the BB&T Prospectuses for Large Cap VIF.
(c) Subject to Section 4(d), the Valuation Time shall be
4:00 p.m. Eastern Standard time on January 26, 2007, or such
earlier or later days as may be established by the proper
officers of BB&T Variable Insurance Funds (the "Valuation
Time").
(d) No formula will be used to adjust the net asset value
of Large Cap Growth VIF or Large Cap VIF to take into account
differences in realized and unrealized gains and losses.
(e) Large Cap VIF shall issue its Shares to Large Cap
Growth VIF on one share deposit receipt registered in the name
of Large Cap Growth VIF. Large Cap Growth VIF shall distribute
in liquidation the Large Cap VIF Shares received by it hereunder
pro rata to its shareholders by redelivering such share deposit
receipt to BB&T Variable Insurance Funds' transfer agent which
will as soon as practicable set up open accounts for each Large
Cap Growth VIF shareholder, in accordance with written
instructions furnished by Large Cap Growth VIF.
(f) Large Cap VIF shall assume all liabilities of Large
Cap Growth VIF, whether accrued or contingent, in connection
with the acquisition of assets and subsequent dissolution of
Large Cap Growth VIF or otherwise, except that recourse for
assumed liabilities relating to Large Cap Growth VIF will be
limited to Large Cap VIF.
5. Expenses, Fees, etc. (a) All fees and expenses
incurred by Large Cap Growth VIF, Large Cap VIF and/or BB&T
Asset Management, Inc. (the investment adviser of both Large Cap
Growth VIF and Large Cap VIF) directly in connection with the
consummation of the transaction contemplated by this Plan will
be borne by BB&T Asset Management, Inc., including the costs of
proxy materials, proxy solicitations and legal expenses. All
such fees and expenses incurred and so borne by BB&T Asset
Management, Inc. will be solely and directly related to the
transaction contemplated by this Plan and will be paid directly
by BB&T Asset Management, Inc. to the relevant providers of
services or other payees, in accordance with the principles set
forth in Revenue Ruling 73-54, 1973-1 C.B. 187. Fees and
expenses not incurred directly in connection with the
consummation of the transaction contemplated by this Plan will
be paid by the party directly incurring such expenses.
Notwithstanding any of the foregoing, fees and expenses shall in
any event be paid by the party directly incurring such fees and
expenses if and to the extent that the payment by BB&T Asset
Management, Inc. of such fees and expenses would result in the
disqualification of such party as a regulated investment company
within the meaning of Section 851 of the Code. Large Cap Growth
VIF shareholders will pay their respective expenses, if any,
incurred in connection with the transaction contemplated by this
Plan. BB&T Asset Management, Inc. nor Large Cap Growth VIF nor
Large Cap VIF will pay Large Cap Growth VIF shareholders'
expenses.
(b) Notwithstanding any other provisions of this Plan, if
for any reason the transaction contemplated by this Plan is not
consummated, no party shall be liable to the other party for any
damages resulting therefrom, including without limitation
consequential damages.
6. Permitted Assets. BB&T Variable Insurance Funds and
Large Cap Growth VIF will agree to review the assets of Large
Cap Growth VIF to ensure that at any time prior to the Exchange
Date the assets of Large Cap Growth VIF do not include any
assets that Large Cap VIF is not permitted, or reasonably
believes to be unsuitable for it, to acquire, including without
limitation any security that, prior to its acquisition by Large
Cap Growth VIF, is unsuitable for Large Cap VIF to acquire.
7. Exchange Date. Delivery of the assets of Large Cap
Growth VIF to be transferred, assumption of the liabilities of
Large Cap Growth VIF to be assumed, and the delivery of Large
Cap VIF Shares to be issued shall be made at the offices of BB&T
Variable Insurance Funds, 0000 Xxxxxxx Xxxx, Xxxxxxxx, XX 00000,
at 9:00 a.m. Eastern standard time on January 29, 2007, or at
such other times and dates established by the proper officers of
BB&T Variable Insurance Funds, the date and time upon which such
delivery is to take place being referred to herein as the
"Exchange Date."
8. Special Meeting of Shareholders; Dissolution. (a)
Large Cap Growth VIF will agree to call a special meeting of the
shareholders as soon as is practicable after the effective date
of the Registration Statement for the purpose of considering the
sale of all of the assets of Large Cap Growth VIF to and the
assumption of all of the liabilities of Large Cap Growth VIF by
Large Cap VIF as herein provided, and approving this Plan, and
it shall be a condition to the obligations of each of the
parties hereto that the holders of the Shares of Large Cap
Growth VIF shall have approved this Plan and the transaction
contemplated herein in the manner required by law and BB&T
Variable Insurance Funds' Declaration of Trust and Bylaws at
such a meeting on or before the Valuation Time.
9. Conditions to Be Met Regarding the Transaction. The
consummation by the Large Cap Growth VIF and Large Cap VIF of
the reorganization of the Large Cap Growth VIF with and into the
Large Cap VIF ("Large Cap Growth VIF Reorganization") shall be
subject to the following conditions:
(a) This Plan shall have been adopted and the transaction
contemplated hereby, shall have been approved by the
shareholders of Large Cap Growth VIF in the manner required by
law.
(b) Large Cap Growth VIF shall have furnished to Large Cap
VIF a statement of each of Large Cap Growth VIF's assets and
liabilities, with values determined as provided in Section 3 of
this Plan, together with a list of Investments with their
respective tax costs, all as of the Valuation Time, certified on
Large Cap Growth VIF's behalf by its President (or any Vice
President) and Treasurer, and a certificate of both such
officers, dated the Exchange Date, to the effect that as of the
Valuation Time and as of the Exchange Date there has been no
material adverse change in the financial position of Large Cap
Growth VIF since June 30, 2006, other than changes in the
Investments since that date or changes in the market value of
the Investments, or changes due to net redemptions of Shares of
Large Cap Growth VIF, dividends paid or losses from operations.
(c) As of the Valuation Time and as of the Exchange Date,
all representations and warranties of BB&T Variable Insurance
Funds, Large Cap VIF and Large Cap Growth VIF made in Section 2
of this Plan are true and correct in all material respects as if
made at and as of such dates, Large Cap Growth VIF has complied
with all requirements of this Plan to be performed or satisfied
at or prior to each of such dates, and Large Cap Growth VIF
shall have furnished to Large Cap VIF a statement, dated the
Exchange Date, signed by BB&T Variable Insurance Funds'
President (or any Vice President) and Treasurer certifying those
facts as of such dates.
(d) There shall not be any material litigation pending
with respect to the matters contemplated by this Plan.
(e) BB&T Variable Insurance Funds shall have received an
opinion of Ropes & Xxxx LLP dated the Exchange Date to the
effect that: (i) BB&T Variable Insurance Funds is a business
trust duly established and validly existing under the laws of
the Commonwealth of Massachusetts, and neither BB&T Variable
Insurance Funds, Large Cap Growth VIF nor Large Cap VIF is, to
the knowledge of such counsel, required to qualify to do
business as a foreign association in any jurisdiction; (ii) BB&T
Variable Insurance Funds and Large Cap Growth VIF have power to
sell, assign, convey, transfer and deliver the Investments and
other assets contemplated hereby and, upon consummation of the
transaction contemplated hereby in accordance with the terms of
this Plan, BB&T Variable Insurance Funds and Large Cap Growth
VIF will have duly sold, assigned, conveyed, transferred and
delivered such Investments and other assets to Large Cap VIF;
(iii) the adoption of this Plan did not, and the consummation of
the transaction contemplated hereby will not, violate BB&T
Variable Insurance Funds' Declaration of Trust or Bylaws, as
amended, or any provision of any agreement known to such counsel
to which BB&T Variable Insurance Funds is a party or by which it
is bound; (iv) no consent, approval, authorization or order of
any court or governmental authority is required for the
consummation by BB&T Variable Insurance Funds of the transaction
contemplated hereby, except such as have been obtained under the
Securities Act of 1933 (the "1933 Act"), the Securities Exchange
Act of 1934 ("the 1934 Act") and the 1940 Act; (v) this Plan has
been duly authorized by BB&T Variable Insurance Funds and is a
valid and binding obligation of BB&T Variable Insurance Funds;
and (vi) the Shares of Large Cap VIF to be delivered to Large
Cap Growth VIF as provided for by this Plan are duly authorized
and upon such delivery will be validly issued and will be fully
paid and nonassessable by BB&T Variable Insurance Funds and no
shareholder of BB&T Variable Insurance Funds has any preemptive
right to subscription or purchase in respect thereof.
(f) With respect to the Large Cap Growth VIF
Reorganization, BB&T Variable Insurance Funds, on behalf of
Large Cap Growth VIF and Large Cap VIF shall have received an
opinion of Ropes & Xxxx LLP addressed to Large Cap Growth VIF
and Large Cap VIF and dated the Exchange Date (which opinion
will be based upon certain factual representations and subject
to certain qualifications) to the effect that, on the basis of
the existing provisions of the Code, Treasury Regulations,
current administrative rules and court decisions, generally for
federal income tax purposes, except as noted below: (i) the
transaction contemplated by this Plan will constitute a
reorganization within the meaning of Section 368(a) of the Code,
and Large Cap VIF and Large Cap Growth VIF will each be a "party
to a reorganization" within the meaning of Section 368(b) of the
Code; (ii) no gain or loss will be recognized by Large Cap VIF
upon the receipt of the assets of Large Cap Growth VIF in
exchange for Large Cap VIF Shares and the assumption by Large
Cap VIF of the liabilities of Large Cap Growth VIF; (iii) the
basis in the hands of Large Cap VIF of the assets of Large Cap
Growth VIF transferred to Large Cap VIF in the transaction
contemplated by this Plan will be the same as the basis of such
assets in the hands of Large Cap Growth VIF immediately prior to
the transfer; (iv) the holding periods of the assets of Large
Cap Growth VIF in the hands of Large Cap VIF will include the
periods during which such assets were held by Large Cap Growth
VIF; (v) no gain or loss will be recognized by Large Cap Growth
VIF upon the transfer of Large Cap Growth VIF's assets to Large
Cap VIF in exchange for Large Cap VIF Shares and the assumption
by Large Cap VIF of the liabilities of Large Cap Growth VIF, or
upon the distribution of Large Cap VIF Shares by Large Cap
Growth VIF to its shareholders in liquidation; (vi) no gain or
loss will be recognized by Large Cap Growth VIF shareholders
upon the exchange of their Large Cap Growth VIF Shares for Large
Cap VIF Shares; (vii) the aggregate basis of Large Cap VIF
Shares a Large Cap Growth VIF shareholder receives in connection
with the transaction contemplated by this Plan will be the same
as the aggregate basis of his or her Large Cap Growth VIF
exchanged therefor; (viii) a Large Cap Growth VIF shareholder's
holding period for his or her Large Cap VIF Shares will be
determined by including the period for which he or she held the
Large Cap Growth VIF Shares exchanged therefor, provided that he
or she held such Large Cap Growth VIF Shares as capital assets;
and (ix) Large Cap VIF will succeed to, and take into account
the items of Large Cap Growth VIF described in Section 318(c) of
the Code, subject to the conditions and limitations specified in
Sections 381, 382, 383 and 384 of the Code and the Treasury
regulations thereunder. The opinion will express no view with
respect to the effect of the reorganization on any transferred
asset as to which any unrealized gain or loss is required to be
recognized at the end of a taxable year (or on the termination
or transfer thereof) under federal income tax principles.
(g) The assets of Large Cap Growth VIF to be acquired by
Large Cap VIF will include no assets which Large Cap VIF, by
reason of limitations contained in its Declaration of Trust or
of investment restrictions disclosed in BB&T Prospectuses and
SAI in effect on the Exchange Date, may not properly acquire.
BB&T Variable Insurance Funds shall not change BB&T Variable
Insurance Funds' Declaration of Trust and BB&T Prospectuses so
as to restrict permitted investments for Large Cap VIF except as
required by the Commission or any state regulatory authority.
(h) The Registration Statement shall have become effective
under the 1933 Act and applicable Blue Sky provisions, and no
stop order suspending such effectiveness shall have been
instituted or, to the knowledge of BB&T Variable Insurance
Funds, contemplated by the Commission and or any state
regulatory authority.
(i) BB&T Variable Insurance Funds shall have received from
the Commission such order or orders as Ropes & Xxxx LLP deems
reasonably necessary or desirable under the 1933 Act, the 1934
Act, the 1940 Act in connection with the transaction
contemplated hereby, and that all such orders shall be in full
force and effect.
(j) Prior to the Exchange Date, the Large Cap Growth VIF
shall have declared a dividend or dividends which, together with
all previous such dividends, shall have the effect of
distributing to its shareholders (a) all of the excess of (x)
its investment income excludable from gross income under Section
103 of the Code over (y) its deductions disallowed under Section
265 and 171 of the Code, (b) all of its investment company
taxable income (in each case computed without regard to any
deduction for dividends paid), and (c) all of its net capital
gain realized (after reduction for any capital loss carryover),
in each case for both the current taxable year (which will end
on the Exchange Date) and the immediately preceding taxable
year.
(k) With respect to the Large Cap Growth VIF
Reorganization, Large Cap Growth VIF shall have furnished to
Large Cap VIF a certificate, signed by the President (or any
Vice President) and the Treasurer of BB&T Variable Insurance
Funds, as to the tax cost to Large Cap Growth VIF of the
securities delivered to Large Cap VIF pursuant to this Plan,
together with any such other evidence as to such tax cost as
Large Cap VIF may reasonably request.
(l) BB&T Variable Insurance Funds shall have received
from the custodian of BB&T Variable Insurance Funds a
certificate identifying all of the assets of Large Cap Growth
VIF held by such custodian as of the Valuation Time.
(m) The transfer agent of BB&T Variable Insurance Funds
shall have provided to BB&T Variable Insurance Funds (i) a
record specifying the number of Shares of Large Cap Growth VIF
outstanding as of the Valuation Time and (iii) a record
specifying the name and address of each holder of record of any
such Shares of Large Cap Growth VIF and the number of Large Cap
Growth VIF Shares held of record by each such shareholder as of
the Valuation Time. Large Cap Growth VIF's transfer agent shall
also have provided BB&T Variable Insurance Funds with a
certificate confirming that the acts specified in the preceding
sentence have been taken and that the information so supplied is
complete and accurate to the best knowledge of the transfer
agent.
(n) BB&T Variable Insurance Funds, on behalf of Large Cap
VIF, shall have executed and delivered an Assumption of
Liabilities dated as of the Exchange Date pursuant to which
Large Cap VIF will assume all of the liabilities of Large Cap
Growth VIF existing at the Valuation Time in connection with the
transaction contemplated by this Plan, other than liabilities
pursuant to this Plan.
(o) BB&T Variable Insurance Funds, on behalf of Large
Cap Growth VIF, shall have executed and delivered an instrument
of transfer ("Transfer Document") and any other certificates or
documents BB&T Variable Insurance Funds may deem necessary or
desirable to transfer Large Cap Growth VIF's entire right, title
and interest in and to the Investments and all other assets of
Large Cap Growth VIF.
10. No Broker, etc. There is no person who has dealt with
BB&T Variable Insurance Funds, Large Cap Growth VIF or Large Cap
VIF who by reason of such dealings is entitled to any broker's
or finder's or other similar fee or commission arising out of
the transaction contemplated by this Plan.
11. Termination. BB&T Variable Insurance Funds may, by
consent of its Trustees, terminate this Plan, and BB&T Variable
Insurance Funds, after consultation with counsel, may modify
this Plan in any manner deemed necessary or desirable.
12. Covenants, etc. Deemed Material. All covenants,
agreements, representations and warranties made under this Plan
and any certificates delivered pursuant to this Plan shall be
deemed to have been material and relied upon by each of the
parties, notwithstanding any investigation made by them or on
their behalf.
13. Sole Plan; Amendments. This Plan supersedes all
previous correspondence and oral communications between the
parties regarding the subject matter hereof, constitutes the
only understanding with respect to such subject matter, may be
changed only by duly adopted resolution of the Board of Trustees
of BB&T Variable Insurance Funds, and shall be construed in
accordance with and governed by the laws of The Commonwealth of
Massachusetts.
14. Rule 145. Pursuant to Rule 145 under the 1933 Act,
BB&T Variable Insurance Funds will, in connection with the
issuance of any Shares of the Large Cap VIF to any person who at
the time of the transaction contemplated hereby is deemed to be
an affiliate of a party to the transaction pursuant to Rule
145(c), cause to be affixed upon the certificates issued to such
person (if any) a legend as follows:
THESE SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, AND MAY NOT BE SOLD OR OTHERWISE
TRANSFERRED EXCEPT TO BB&T VARIABLE INSURANCE FUNDS OR ITS
PRINCIPAL UNDERWRITER UNLESS (i) A REGISTRATION STATEMENT WITH
RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR (ii) IN THE OPINION OF COUNSEL REASONABLY
SATISFACTORY TO BB&T FUNDS SUCH REGISTRATION IS NOT REQUIRED.
15. BB&T Variable Insurance Funds' Declaration of Trust
BB&T Variable Insurance Funds is a business trust organized
under Massachusetts law and under a Declaration of Trust, to
which reference is hereby made and a copy of which is on file at
the office of the Secretary of The Commonwealth of Massachusetts
and elsewhere as required by law, and to any and all amendments
thereto so filed or hereafter filed. The obligations of "BB&T
Variable Insurance Funds" entered into in the name or on behalf
thereof by any of the Trustees, officers, employees or agents
are made not individually, but in such capacities, and are not
binding upon any of the Trustees, officers, employees, agents or
shareholders of BB&T Variable Insurance Funds personally, but
bind only the assets of BB&T Variable Insurance Funds and all
persons dealing with any series or funds of BB&T Variable
Insurance Funds, such as Large Cap VIF, must look solely to the
assets of BB&T Variable Insurance Funds belonging to such series
or funds for the enforcement of any claims against BB&T Variable
Insurance Funds.
[Signature Page Follows]
This Agreement may be executed in any number of counter-
parts, each of which, when executed and delivered, shall be
deemed to be an original.
BB&T VARIABLE INSURANCE FUNDS,
on behalf of BB&T Large Cap VIF and
BB&T Large Cap Growth VIF
By: _/s/ Xxxx Miller__
Name: Xxxx Xxxxxx
Title: Vice President
BB&T ASSET MANAGEMENT, INC.,
with respect to Section 5 only
By: _/s/ E. G. Xxxxxxx, III__
Name: E. G. Xxxxxxx, III
Title: Senior Vice President
