AGREEMENT AND PLAN OF REORGANIZATION
THIS
AGREEMENT AND PLAN OF REORGANIZATION (this “Agreement”) is made as of this __th
day of ________, 2005, by XXXXXXX.xxx, a Delaware statutory trust, for itself
and on behalf of the Generation Wave Aggressive Growth Fund and Generation Wave
Alternative Growth Fund, (the “Acquired Funds”) and on behalf of the
Generation Wave Growth Fund (the “Acquiring Fund”), each a series of
XXXXXXX.xxx, and, Mutuals Advisors, Inc. (the “Advisor”), a Delaware corporation
for certain requirements as set for the below.
|
Acquired
Fund |
Acquiring
Fund | |
|
Generation
Wave Aggressive Growth Fund |
Generation
Wave Growth Fund | |
|
Generation
Wave Alternative Growth Fund |
Generation
Wave Growth Fund |
WHEREAS,
in accordance with the terms and conditions set forth in this Agreement, the
parties desire that the Acquiring Fund acquire assets and assume the liabilities
of the Acquired Funds, in exchange for shares of the corresponding class of the
Acquiring Fund (“Acquiring Fund Shares”), and that these Acquiring Fund Shares
be distributed immediately after the Closing, as defined in this Agreement, by
the Acquired Funds to their shareholders in liquidation of the Acquired
Funds;
WHEREAS,
the Board of Trustees of XXXXXXX.xxx, including a majority of its Trustees who
are not “interested persons” of XXXXXXX.xxx, as defined in the Investment
Company Act of 1940, as amended (the “1940 Act”), has determined that the
Reorganization (as such term is defined in Section 1.1 below) is in the
best interests of the shareholders of the Acquired Funds and Acquiring Fund, and
that their interests would not be diluted as a result of the transactions
contemplated thereby;
WHEREAS,
this Agreement is intended to be and is adopted as a plan of reorganization and
liquidation within the meaning of Section 368(a) of the Internal Revenue
Code of 1986, as amended (the “Code”).
NOW
THEREFORE, in consideration of the premises and of the covenants and agreements
hereinafter set forth, the parties hereto, intending to be legally bound hereby,
covenant and agree as follows:
| 1. |
REORGANIZATION
OF ACQUIRED FUNDS |
1.1 Subject
to the terms and conditions herein set forth, and on the basis of the
representations and warranties contained herein, the Acquired Funds shall
assign, deliver and otherwise transfer their assets as set forth in
paragraph 1.2 (the “Fund Assets”) to the Acquiring Fund and the Acquiring
Fund shall assume the Acquired Funds’ liabilities as set forth in
paragraph 1.3 (the “Liabilities”). The Acquiring Fund shall, as
consideration therefor, on the Closing Date (as defined in paragraph 3.1),
deliver to the Acquired Funds full and fractional Acquiring Fund Shares, the
number of which shall be determined by dividing (a) the value of the
Acquired Funds’ Assets, net of the Acquired Funds’ Liabilities, computed in the
manner and as of the time and date set forth in paragraph 2.1, by
(b) the net asset value of one share of the Acquiring Fund computed in the
manner and as of the time and date set forth in paragraph 2.2. Such
transfer, delivery and assumption shall take place at the closing provided for
in paragraph 3.1 (hereinafter sometimes referred to as the “Closing”).
Immediately following the Closing, the Acquired Funds shall distribute the
Acquiring Fund Shares to the shareholders of the Acquired Funds in liquidation
of the Acquired Funds as provided in paragraph 1.4 hereof. Such
transactions are hereinafter sometimes collectively referred to as the
“Reorganization.”
1.2 (a)With
respect to the Acquired Funds, the Funds Assets shall consist of all property
and assets of any nature whatsoever, including, without limitation, all cash,
cash equivalents, securities, instruments, claims and receivables (including
dividend and interest receivables) owned by the Acquired Funds, and any prepaid
expenses shown as an asset on the Acquired Funds’ books on the Closing
Date.
(b) Before
the Closing Date, the Acquired Funds will provide the Acquiring Fund with a
schedule of their assets and their known liabilities, and the Acquiring Fund
will provide the Acquired Funds with a copy of the current investment objective
and policies applicable to the Acquiring Fund. The Acquired Funds reserve the
right to sell or otherwise dispose of any of the securities or other assets
shown on the list of the Acquired Funds’ Fund Assets before the Closing Date but
will not, without the prior approval of the Acquiring Fund, acquire any
additional securities other than securities which the Acquiring Fund is
permitted to purchase in accordance with its stated investment objective and
policies.
1.3 The
Acquired Funds will endeavor to discharge all of their known liabilities and
obligations prior to the Closing Date. The Acquiring Fund will assume all
liabilities and obligations allocated or attributable to the Acquired Funds,
whether absolute or contingent, known or unknown, accrued or unaccrued (the
“Liabilities”) (including contingent reimbursement to the Advisor of fees waived
or expenses reimbursed under an expense limitation agreement.)
1.4 Immediately
following the Closing, the Acquired Funds will distribute the corresponding
Acquiring Fund Shares received by the Acquired Funds pursuant to
paragraph 1.1 pro
rata to their
shareholders of record determined as of the close of business on the Closing
Date (“Acquired Fund Investors”) in complete liquidation of the Acquired Funds.
That distribution will be accomplished by an instruction, signed by an
appropriate officer of XXXXXXX.xxx, to transfer the Acquiring Fund Shares then
credited to the Acquired Funds’ account on the books of the Acquiring Fund to
open accounts on the books of the Acquiring Fund established and maintained by
the Acquiring Fund’s transfer agent in the names of record of the Acquired Fund
Investors and representing the number of shares of the Acquiring Fund due such
Acquired Fund Investor. All issued and outstanding shares of the Acquired Funds
will be cancelled simultaneously therewith on the Acquired Funds’ books, and any
outstanding share certificates representing interests in the Acquired Funds will
represent only the right to receive such number of Acquiring Fund Shares after
the Closing as determined in accordance with paragraph 1.l.
1.5 Following
the transfer of Fund Assets by the Acquired Funds to the Acquiring Fund, the
assumption of the Acquired Funds’ Liabilities by the Acquiring Fund, and the
distribution by the Acquired Funds of the Acquiring Fund Shares received by them
pursuant to paragraph 1.4, the Acquired Funds shall terminate their
qualification, classification and registration with all appropriate federal and
state agencies. Any reporting or other responsibility of the Acquired Funds are
and shall remain the responsibility of the Acquired Funds up to and including
the date on which the Acquired Funds are terminated and deregistered, subject to
any reporting or other obligations described in paragraph 4.8.
| 2. |
VALUATION |
2.1 The value
of the Acquired Funds’ Fund Assets shall be the value of those assets computed
as of the time at which their net asset value is calculated pursuant to the
valuation procedures set forth in the Acquired Funds’ then-current Prospectus
and Statement of Additional Information on the business day immediately
preceding the Closing Date, or at such time on such earlier or later date as may
mutually be agreed upon in writing among the parties hereto (such time and date
being herein called the “Applicable Valuation Date”).
2.2 The net
asset value of each share of the Acquired Funds shall be the net asset value per
share computed on the Applicable Valuation Date, using the market valuation
procedures set forth in the Acquired Funds’ then-current Prospectus and
Statement of Additional Information.
2.3 All
computations of value contemplated by this Article 2 shall be made by the
Acquired Funds’ administrator in accordance with its regular practice as pricing
agent. The Acquiring Fund shall cause the administrator to deliver a copy of its
valuation report to XXXXXXX.xxx and the Acquired Funds at the
Closing.
| 3. |
CLOSING(S)
AND CLOSING DATE |
3.1 The
Closing for the Reorganization shall occur on or before July 29, 2005, and/or on
such other date(s) as may be mutually agreed upon in writing by the parties
hereto (each, a “Closing Date”). The Closing(s) shall be held at the offices of
U.S. Bancorp Fund Services, LLC, 000 Xxxx Xxxxxxxxx Xxxxxx, 0xx Xxxxx,
Xxxxxxxxx, Xxxxxxxxx 00000, or at such other location as is mutually agreeable
to the parties hereto. All acts taking place at the Closing(s) shall be deemed
to take place simultaneously as of [TIME], Central time on the Closing Date
unless otherwise provided.
3.2 The
Acquiring Funds’ custodian shall deliver at the Closing evidence that:
(a) the Acquired Funds’ Assets have been delivered in proper form to the
corresponding Acquiring Fund on the Closing Date and (b) all necessary
taxes including all applicable federal and state stock transfer stamps, if any,
have been paid, or provision for payment shall have been made, by the Acquired
Funds in conjunction with the delivery of portfolio securities.
3.3 Notwithstanding
anything herein to the contrary, if on the Applicable Valuation Date
(a) the New York Stock Exchange shall be closed to trading or trading
thereon 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
Acquiring Fund, accurate appraisal of the value of the net assets of the
Acquiring Fund or the Acquired Funds is impracticable, the Applicable Valuation
Date shall be postponed until the first business day after the day when trading
shall have been fully resumed without restriction or disruption and reporting
shall have been restored.
| 4. |
COVENANTS
WITH RESPECT TO THE ACQUIRING FUND AND THE ACQUIRED
FUNDS |
4.1 With
respect to the Acquired Funds, XXXXXXX.xxx has called or will call a meeting of
the Acquired Funds’ shareholders to consider and act upon this Agreement and to
take all other actions reasonably necessary to obtain the approval of the
transactions contemplated herein, including approval for the Acquired Funds’
liquidating distribution of Acquiring Fund Shares contemplated hereby, and for
the Acquired Funds to terminate their qualification, classification and
registration if requisite approvals are obtained with respect to the Acquired
Funds. The Acquired Funds shall prepare the notice of meeting, form of proxy and
proxy statement (collectively, “Proxy Materials”) to be used in connection with
that meeting.
4.2 XXXXXXX.xxx,
on behalf of the Acquired Funds, covenants that the corresponding 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.
4.3 XXXXXXX.xxx,
on behalf of the Acquired Funds, will assist the Acquiring Fund in obtaining
such information as the Acquiring Fund reasonably requests concerning the
beneficial ownership of shares of the Acquired Funds.
4.4 Subject
to the provisions hereof, XXXXXXX.xxx, on its own behalf and on behalf of the
Acquiring Fund and Acquired Funds, will take, or cause to be taken, all actions,
and do, or cause to be done, all things reasonably necessary, proper or
advisable to consummate and make effective the transactions contemplated
herein.
4.5 XXXXXXX.xxx,
on behalf of the Acquired Funds, shall furnish to the Acquiring Fund on the
Closing Date, a final statement of the total amount of such Acquired Funds’
assets and liabilities as of the Closing Date.
4.6 XXXXXXX.xxx,
on behalf of the Acquiring Fund, has prepared and filed, or will prepare and
file, with the Securities and Exchange Commission (the “SEC”) a
registration statement on Form N-14, and the current prospectus and
statement of additional information of the Acquiring Fund, under the Securities
Act of 1933, as amended (the “1933 Act”), relating to the Acquiring Fund
Shares (the “Registration Statement”). The Acquired Funds have provided or will
provide the Acquiring Fund with the Proxy Materials for inclusion in the
Registration Statement, prepared in accordance with paragraph 4.1, and with
such other information and documents relating to the Acquired Funds as are
requested by the Acquiring Fund and as are reasonably necessary for the
preparation of the Registration Statement.
4.7 As soon
after the Closing Date as is reasonably practicable, XXXXXXX.xxx, on behalf of
the Acquired Funds: (a) shall prepare and file all federal and other tax
returns and reports of the Acquired Funds required by law to be filed with
respect to all periods ending on/or before the Closing Date but not theretofore
filed and (b) shall pay all federal and other taxes shown as due thereon
and/or all federal and other taxes that were unpaid as of the Closing
Date.
4.8 Following
the transfer of Fund Assets by the Acquired Funds to the Acquiring Fund and the
assumption of the Liabilities of the Acquired Funds in exchange for the
Acquiring Fund Shares as contemplated herein, XXXXXXX.xxx will file any final
regulatory reports, including but not limited to any Form N-CSR filing with
respect to the Acquired Funds, promptly after the Closing Date and also will
take all other steps as are necessary and proper to effect the termination or
declassification of the Acquired Funds in accordance with the laws of the state
of Delaware and other applicable requirements.
| 5. |
REPRESENTATIONS
AND WARRANTIES |
5.1 XXXXXXX.xxx,
on behalf of the Acquiring Fund, represents and warrants to the Acquired Funds
as follows:
(a) XXXXXXX.xxx
was duly created pursuant to its Agreement and Declaration of Trust by its
trustees for the purpose of acting as a management investment company under the
Investment Company Act of 1940 (the “1940 Act”) and is validly
existing under the laws of the State of Delaware, and its Declaration of Trust
directs its trustees to manage the affairs of XXXXXXX.xxx and grants them all
powers necessary or desirable to carry out such responsibility, including
administering XXXXXXX.xxx’s business as currently conducted by XXXXXXX.xxx and
as described in the current prospectus of XXXXXXX.xxx. XXXXXXX.xxx is registered
as an investment company classified as an open-end management company under the
1940 Act and its registration with the SEC as an investment company is in
full force and effect;
(b) The
Registration Statement, including the current prospectus and statement of
additional information of the Acquiring Fund, conforms or will conform, at all
times up to and including the Closing Date, in all material respects to the
applicable requirements of the 1933 Act and the 1940 Act and the
regulations thereunder and does not include and will 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 misleading;
(c) The
Acquiring Fund is not in breach or violation of, and the execution, delivery and
performance of this Agreement by XXXXXXX.xxx for itself and on behalf of the
Acquiring Fund does not and will not (i) violate XXXXXXX.xxx’s Declaration
of Trust or By-Laws, or (ii) result in a breach of, violate, or constitute
a default under, any material agreement or material instrument to which
XXXXXXX.xxx is a party or by which its properties or assets are
bound;
(d) Except as
previously disclosed in writing to the Acquired Funds, no litigation or
administrative proceeding or investigation of or before any court or
governmental body is presently pending or, to XXXXXXX.xxx’s knowledge threatened
against XXXXXXX.xxx or its business, the Acquiring Fund or any of its properties
or assets, which, if adversely determined, would materially and adversely affect
XXXXXXX.xxx or the Acquiring Fund’s financial condition or the conduct of their
business. XXXXXXX.xxx knows of no facts that might form the basis for the
institution of any such proceeding or investigation, and the Acquiring Fund 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, or is
reasonably likely to materially and adversely affect, its business or its
ability to consummate the transactions contemplated herein;
(e) All
issued and outstanding shares, including shares to be issued in connection with
the Reorganization, of the Acquiring Fund will, as of the Closing Date, be duly
authorized and validly issued and outstanding, fully paid and non-assessable,
free and clear of all liens, pledges, security interests, charges or other
encumbrances; the shares of the Acquiring Fund issued and outstanding before the
Closing Date were offered and sold in compliance with the applicable
registration requirements, or exemptions therefrom, of the 1933 Act, and
all applicable state securities laws, and the regulations thereunder; and the
Acquiring Fund does not have outstanding any options, warrants or other rights
to subscribe for or purchase any of its shares nor is there outstanding any
security convertible into any of their shares;
(f) The
execution, delivery and performance of this Agreement on behalf of the Acquiring
Fund will have been duly authorized prior to the Closing Date by all necessary
action on the part of XXXXXXX.xxx, its trustees and the Acquiring Fund, and this
Agreement will constitute a valid and binding obligation of XXXXXXX.xxx and the
Acquiring Fund enforceable in accordance with its terms, subject as to
enforcement, to bankruptcy, insolvency, reorganization, arrangement, moratorium
and other similar laws of general applicability relating to or affecting
creditors rights, and to general equity principles;
(g) The
Acquiring Fund has qualified as a separate regulated investment company under
the Code and has taken all necessary and required actions to maintain such
status;
(h) On the
effective date of the Registration Statement, at the time of the meeting of the
Acquired Funds’ shareholders and on the Closing Date, any written information
furnished by XXXXXXX.xxx with respect to the Acquiring Fund for use in the Proxy
Materials, the Registration Statement or any other materials provided in
connection with the Reorganization does not and will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the information provided not misleading; and
(i) To the
knowledge of the Acquiring Fund, no governmental consents, approvals,
authorizations or filings are required under the 1933 Act, the Securities
Exchange Act of 1934 (the “1934 Act”), the 1940 Act or Delaware law
for the execution of this Agreement by XXXXXXX.xxx, for itself and on behalf of
the Acquiring Fund, or the performance of the Agreement by XXXXXXX.xxx for
itself and on behalf of the Acquiring Funds, except for such consents,
approvals, authorizations and filings as have been contemplated by this
Agreement, and except for such consents, approvals, authorizations and filings
as may be required after the Closing Date.
5.2 XXXXXXX.xxx,
on behalf of the Acquired Funds, represents and warrants to the Acquiring Fund
as follows:
(a) XXXXXXX.xxx
was duly created pursuant to its Agreement and Declaration of Trust by its
trustees for the purpose of acting as a management investment company under the
Investment Company Act of 1940 (the “1940 Act”) and is validly
existing under the laws of the State of Delaware, and its Declaration of Trust
directs its trustees to manage the affairs of XXXXXXX.xxx and grants them all
powers necessary or desirable to carry out such responsibility, including
administering XXXXXXX.xxx’s business as currently conducted by XXXXXXX.xxx and
as described in the current prospectus of XXXXXXX.xxx. XXXXXXX.xxx is registered
as an investment company classified as an open-end management company under the
1940 Act and its registration with the SEC as an investment company is in
full force and effect.
(b) All of
the issued and outstanding shares of the Acquired Funds have been offered and
sold in compliance in all material respects with applicable registration or
notice requirements of the 1933 Act and state securities laws; all issued
and outstanding shares of the Acquired Funds are, and on the Closing Date will
be, duly authorized and validly issued and outstanding, and fully paid and
non-assessable, and the Acquired Funds do not have outstanding any options,
warrants or other rights to subscribe for or purchase any of their shares, nor
is there outstanding any security convertible into any of their shares (other
than exchange privileges set forth in the Registration Statement);
(c) The
Registration Statement, including the current prospectus and statement of
additional information of the Acquired Funds, conforms or will conform, at all
times up to and including the Closing Date, in all material respects to the
applicable requirements of the 1933 Act and the 1940 Act and the
regulations thereunder and does not include and will 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 misleading;
(d) The
Acquired Funds are not in breach or violation of, and the execution, delivery
and performance of this Agreement by the Acquired Funds does not and will not
(i) violate XXXXXXX.xxx’s Articles of Incorporation or By-Laws, or
(ii) result in a breach of, violate, or constitute a default under, any
material agreement or material instrument to which XXXXXXX.xxx is a party or by
its properties or assets are bound;
(e) Except as
previously disclosed in writing to the Acquiring Fund, no litigation or
administrative proceeding or investigation of or before any court or
governmental body is presently pending or, to XXXXXXX.xxx’s knowledge,
threatened against XXXXXXX.xxx or its business, the Acquired Funds or any of
their properties or assets which, if adversely determined, would materially and
adversely affect XXXXXXX.xxx or the Acquired Funds’ financial condition or the
conduct of their business. XXXXXXX.xxx knows of no facts that might form the
basis for the institution of any such proceeding or investigation, and the
Acquired Funds are not a party to or subject to the provisions of any order,
decree or judgment of any court or governmental body that materially and
adversely affects, or is reasonably likely to materially and adversely affect,
their business or their ability to consummate the transactions contemplated
herein;
(f) The
Statement of Assets and Liabilities, Statement of Operations and Statement of
Changes in Net Assets of the Acquired Funds as of and for the period ended March
31, 2005, audited by Xxxx, Xxxxxx and Xxxxx (copies of which have been or will
be furnished to the Acquiring Fund) fairly present, in all material respects,
the Acquired Funds’ financial condition as of such date and their results of
operations for such period in accordance with generally accepted accounting
principles consistently applied, and as of such date there were no liabilities
of the Acquired Funds (contingent or otherwise) known to the Acquired Funds that
were not disclosed therein but that would be required to be disclosed therein in
accordance with generally accepted accounting principles;
(g) Since the
date of its most recent audited financial statements, there has not been any
material adverse change in any Acquired Funds’ financial condition, assets,
liabilities or business, other than changes occurring in the ordinary course of
business, or any incurrence by the Acquired Funds of indebtedness maturing more
than one year from the date such indebtedness was incurred, except as otherwise
disclosed in writing to and accepted by the Acquiring Funds, prior to the
Closing Date (for the purposes of this subparagraph (g), neither a decline
in an Acquired Fund’s net asset value per share nor a decrease in an Acquired
Fund’s size due to redemptions shall be deemed to constitute a material adverse
change);
(h) All
federal and other tax returns and reports of the Acquired Funds required by law
to be filed on or before the Closing Date have been filed, and all taxes owed by
the Acquired Funds or the Acquiring Fund has been paid so far as due, and to the
best of the Acquired Funds’ knowledge, no such return is currently under audit
and no assessment has been asserted with respect to any such
return;
(i) For each
full and partial taxable year from its inception through the Closing Date, the
Acquired Funds have each qualified as a separate regulated investment company
under the Code and have taken all necessary and required actions to maintain
such status;
(j) At the
Closing Date, the Acquired Funds will have good and marketable title to their
Fund Assets and full right, power and authority to assign, deliver and otherwise
transfer such Fund Assets hereunder, and upon delivery and payment for such Fund
Assets as contemplated herein, the Acquiring Fund will acquire good and
marketable title thereto, subject to no restrictions on the ownership or
transfer thereof other than such restrictions as might arise under the
1933 Act;
(k) The
execution, delivery and performance of this Agreement on behalf of the Acquired
Funds will have been duly authorized prior to the Closing Date by all necessary
action on the part of XXXXXXX.xxx, its Trustees and the Acquired Funds, and this
Agreement will constitute a valid and binding obligation of the Acquired Funds
enforceable in accordance with its terms, subject as to enforcement, to
bankruptcy, insolvency, reorganization, arrangement, moratorium and other
similar laws of general applicability relating to or affecting creditors, rights
and to general equity principles;
(l) From the
effective date of the Registration Statement through the time of the meeting of
the Acquired Fund Investors, and on the Closing Date, the Proxy Materials
(exclusive of the portions of the Acquiring Fund’s Prospectus contained or
incorporated by reference therein, and exclusive of any written information
furnished by the Acquired Funds with respect to the Acquiring Fund):
(i) will comply in all material respects with the applicable provisions of
the 1933 Act, the 1934 Act and the 1940 Act and the 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 not misleading, and as of such dates and times,
any written information furnished by XXXXXXX.xxx, on behalf of the Acquired
Funds, for use in the Registration Statement or in any other manner that may be
necessary in connection with the transactions contemplated hereby will not
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the information provided not misleading; and
(m) To the
knowledge of the Acquired Funds, no governmental consents, approvals,
authorizations or filings are required under the 1933 Act, the
1934 Act, the 1940 Act or Delaware law for the execution of this
Agreement by XXXXXXX.xxx, for itself and on behalf of the Acquired Funds, or the
performance of the Agreement by XXXXXXX.xxx, for itself and on behalf of the
Acquired Funds, except for such consents, approvals, authorizations and filings
as have been made or received, and except for such consents, approvals,
authorizations and filings as may be required subsequent to the Closing
Date.
| 6. |
CONDITIONS
PRECEDENT TO OBLIGATIONS OF ACQUIRED FUNDS |
The
obligations of the Acquired Funds to consummate the Reorganization shall be
subject to the performance by the Acquired Funds of all the obligations to be
performed by them hereunder on or before the Closing Date and, in addition
thereto, the following conditions with respect to the corresponding Acquiring
Fund:
6.1 All
representations and warranties of XXXXXXX.xxx with respect to the Acquiring Fund
contained herein 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
herein, as of the Closing Date with the same force and effect as if made on and
as of the Closing Date.
6.2 XXXXXXX.xxx,
on behalf of the Acquiring Fund, shall have delivered to the Acquired Funds, at
the Closing a certificate executed on behalf of the Acquiring Fund by any two of
XXXXXXX.xxx’s President, Treasurer or Secretary in a form reasonably
satisfactory to the Acquired Funds and dated as of the Closing Date, to the
effect that the representations and warranties of XXXXXXX.xxx with respect to
the Acquiring Fund made herein are true and correct at and as of the Closing
Date, except as they may be affected by the transactions contemplated herein,
and as to such other matters as the Acquired Funds shall reasonably
request.
6.3 Unless
waived by the Acquired Funds, the Acquired Funds shall have received at the
Closing assurances of an officer of XXXXXXX.xxx, in a form reasonably
satisfactory to XXXXXXX.xxx, substantially to the effect that:
(a) XXXXXXX.xxx
is a duly registered, open-end, management investment company, and its
registration with the SEC as an investment company under the 1940 Act is in full
force and effect;
(b) XXXXXXX.xxx
is a statutory trust duly created pursuant to its Agreement and Declaration of
Trust, is validly existing and in good standing under the laws of Delaware, and
the Agreement and Declaration of Trust directs its trustees to manage the
affairs of XXXXXXX.xxx and the Acquiring Fund and grants them all powers
necessary or desirable to carry out such responsibility, including administering
the Acquiring Fund’s business as described in the prospectus of the Acquiring
Fund;
(c) this
Agreement has been duly authorized, executed and delivered by XXXXXXX.xxx on
behalf of XXXXXXX.xxx and the Acquiring Fund and, assuming due authorization,
execution and delivery of this Agreement on behalf of the Acquired Funds, is a
valid and binding obligation of XXXXXXX.xxx, enforceable against XXXXXXX.xxx in
accordance with its terms, subject as to enforcement to bankruptcy, insolvency,
reorganization, arrangement, moratorium and other similar laws of general
applicability relating to or affecting creditors, rights and to general equity
principles;
(d) the
Acquiring Fund Shares to be issued to the Acquired Funds and then distributed to
the Acquired Fund Investors pursuant to this Agreement are duly registered under
the 1933 Act on the appropriate form, and are duly authorized and upon such
issuance will be validly issued and outstanding and fully paid and
non-assessable, and no shareholder of the Acquiring Fund has any preemptive
rights to subscription or purchase in respect thereof;
(e) the
Registration Statement has become effective with the SEC and, to the best of
such officer’s knowledge, no stop order suspending the effectiveness thereof has
been issued and no proceedings for that purpose have been instituted or are
pending or threatened;
(f) to the
knowledge of such officer, no consent, approval, authorization, filing or order
of any court or governmental authority of the United States or any state is
required for the consummation of the Reorganization with respect to the
Acquiring Fund, except for such consents, approvals, authorizations and filings
as have been made or received, and except for such consents, approvals,
authorizations and filings as may be required after the Closing Date;
and
(g) to the
knowledge of such officer, no litigation or administrative proceeding or
investigation of or before any court or governmental body is presently pending
or threatened as to XXXXXXX.xxx or the Acquiring Fund or any of their properties
or assets and neither XXXXXXX.xxx nor the Acquiring Fund is a party to or
subject to the provisions of any order, decree or judgment of any court or
governmental body that materially and adversely affects its
business.
6.4 The Board
of Trustees of XXXXXXX.xxx shall have determined that the Reorganization is in
the best interests of the Acquiring Fund.
| 7. |
CONDITIONS
PRECEDENT TO OBLIGATIONS OF ACQUIRING FUND |
The
obligations of XXXXXXX.xxx to consummate the Reorganization with respect to the
Acquiring Fund shall be subject to the performance by XXXXXXX.xxx of all the
obligations to be performed by it hereunder, with respect to XXXXXXX.xxx and the
Acquired Funds, on or before the Closing Date and, in addition thereto, the
following conditions:
7.1 All
representations and warranties of XXXXXXX.xxx on behalf of the Acquired Funds
contained herein 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 XXXXXXX.xxx,
on behalf of the Acquired Funds, shall have delivered to the Acquiring Fund at
the Closing a certificate executed on behalf of the Acquired Fund, by
XXXXXXX.xxx’s President, Treasurer, or Secretary, in form and substance
satisfactory to the Acquiring Fund and dated as of the Closing Date, to the
effect that the representations and warranties of XXXXXXX.xxx and the Acquired
Funds made herein are true and correct at and as of the Closing Date, except as
they may be affected by the transactions contemplated herein and as to such
other matters as the Acquiring Fund shall reasonably request.
7.3 The
Acquiring Fund shall have received at the Closing assurances of an officer of
XXXXXXX.xxx, in a form reasonably satisfactory to the Acquiring Fund,
substantially to the effect that:
(a) XXXXXXX.xxx
is a duly registered, open-end, management investment company, and its
registration with the SEC as an investment company under the 1940 Act is in full
force and effect;
(b) XXXXXXX.xxx
is a statutory trust duly created pursuant to its Agreement and Declaration of
Trust, is validly existing and in good standing under the laws of Delaware, and
the Agreement and Declaration of Trust directs its trustees to manage the
affairs of XXXXXXX.xxx and the Acquired Funds and grants them all powers
necessary or desirable to carry out such responsibility, including administering
the Acquired Funds’ business as described in the prospectus of the Acquired
Funds.
(c) this
Agreement has been duly authorized, executed and delivered by XXXXXXX.xxx and,
assuming due authorization, execution and delivery of this Agreement on behalf
of the Acquiring Fund, is a valid and binding obligation of XXXXXXX.xxx,
enforceable against XXXXXXX.xxx in accordance with its terms, subject as to
enforcement to bankruptcy, insolvency, reorganization, arrangement, moratorium
and other similar laws of general applicability relating to or affecting
creditors, rights and to general equity principles;
(d) to the
knowledge of such officer, no consent, approval, authorization, filing or order
of any court or governmental authority of the United States or any state is
required for the consummation of the Reorganization with respect to the Acquired
Funds, except for such consents, approvals, authorizations and filings as have
been made or received, and except for such consents, approvals, authorizations
and filings as may be required subsequent to the Closing Date;
(e) to the
knowledge of such officer, no litigation or administrative proceeding or
investigation of or before any court or governmental body is presently pending
or threatened as to XXXXXXX.xxx or the Acquired Funds or any of their properties
or assets and neither XXXXXXX.xxx nor the Acquired Funds are a party to or
subject to the provisions of any order, decree or judgment of any court or
governmental body that materially and adversely effects its
business;
(f) the
Acquired Fund Shares then issued and outstanding are duly registered under the
1933 Act on the appropriate form, and are duly authorized and are validly
issued and outstanding and fully paid and non-assessable, and no shareholder of
the corresponding Acquiring Fund has any preemptive rights to subscription or
purchase in respect thereof; and
(g) the
registration statement of the Acquired Funds is effective with the SEC and, to
such officer’s knowledge, no stop order suspending the effectiveness thereof has
been issued and no proceedings for that purpose have been instituted or are
pending or threatened.
7.4 The Board
of Trustees of XXXXXXX.xxx shall have determined that the Reorganization is in
the best interests of the Acquired Funds.
7.5 The
transfer agent to the Acquired Funds shall have delivered to the Acquiring Fund
at the Closing a certificate executed on its own behalf by an authorized officer
in form and substance satisfactory to the Acquiring Fund and dated as of the
Closing Date, to the effect that the shareholder records of the Acquired Funds
are in good order and as to such other matters as the Acquiring Fund shall
reasonably request.
7.6 XXXXXXX.xxx
shall arrange to make the Acquired Funds’ auditors available to the Acquiring
Fund and its agents to answer their questions at a mutually agreeable time prior
to the Closing.
| 8. |
FURTHER
CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND AND THE ACQUIRED
FUNDS |
The
obligations of the Acquiring Fund and of the Acquired Funds herein are each
subject to the further conditions that on or before the Closing Date with
respect to the Acquiring Fund and the Acquired Funds:
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
Funds in accordance with the provisions of XXXXXXX.xxx’s Articles of
Incorporation and the requirements of the 1940 Act, and certified copies of
the resolutions evidencing such approval shall have been delivered to
XXXXXXX.xxx.
8.2 On the
Closing Date, no action, suit or other proceeding shall be 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 any of the
transactions contemplated herein.
8.3 All
consents of other parties and all other consents, orders, approvals and permits
of federal, state and local regulatory authorities (including, without
limitation, those of the SEC and of state securities authorities) deemed
necessary by XXXXXXX.xxx, on behalf of the Acquiring Fund, or on behalf of the
Acquired Funds, to permit consummation, in all material respects, of the
transactions contemplated herein shall have been obtained, except where failure
to obtain any such consent, order or permit would not, in the opinion of the
party asserting that the condition to closing has not been satisfied, involve a
risk of a material adverse effect on the assets or properties of the Acquiring
Fund or the Acquired Funds.
8.4 The
Registration Statement shall have become effective under the 1933 Act, 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 0000 Xxx.
8.5 The
Acquiring Fund and the Acquired Funds shall have received an opinion of counsel
to XXXXXXX.xxx substantially to the effect that for federal income tax
purposes:
(a) the
transfer by the Acquired Funds of the Fund Assets in exchange for the Acquiring
Fund Shares and the assumption by the Acquiring Fund of the Liabilities will
constitute a “reorganization” within the meaning of Section 368(a) of the
Code and the Acquiring Fund and corresponding Acquired Funds are “parties to a
reorganization” within the meaning of Section 368(b) of the
Code;
(b) no gain
or loss will be recognized by the Acquiring Fund upon the receipt of the Fund
Assets solely in exchange for the corresponding Acquiring Fund Shares and the
assumption by the Acquiring Fund of the Liabilities;
(c) no gain
or loss will be recognized by the Acquired Funds upon the transfer of the Fund
Assets to the corresponding Acquiring Fund and the assumption by the Acquiring
Fund of the Liabilities in exchange for the Acquiring Fund Shares or upon the
distribution (whether actual or constructive) of the Acquiring Fund Shares to
the Acquired Funds’ shareholders in exchange for their shares of the Acquired
Funds;
(d) no gain
or loss will be recognized by the Acquired Fund Investors upon the exchange of
their Acquired Fund Shares for the corresponding Acquiring Fund
Shares;
(e) the
aggregate tax basis for the Acquiring Fund Shares received by the Acquired Fund
Investors pursuant to the Reorganization will be the same as the aggregate tax
basis of the Acquired Funds’ shares held by such shareholder immediately prior
to the Reorganization, and the holding period of the Acquiring Fund Shares to be
received by the Acquired Fund Investors will include the period during which the
Acquired Funds’ shares exchanged therefor were held by such shareholder
(provided the Acquired Funds’ shares were held as capital assets on the date of
the Reorganization); and
(f) the tax
basis of the Acquired Funds’ assets acquired by the corresponding Acquiring Fund
will be the same as the tax basis of such assets to the Acquired Funds
immediately prior to the Reorganization, and the holding period of the assets of
the Acquired Funds in the hands of the Acquiring Fund will include the period
during which those assets were held by the Acquired Funds.
| 9. |
EXPENSES |
The
Advisor shall be responsible for all expenses in connection with the
Reorganization, except as set forth in this paragraph, and shall reimburse each
of the Acquiring Fund and the Acquired Funds for all expenses incurred by it in
connection with the Reorganization and with this Agreement whether or not the
transaction contemplated is consummated. The Acquired Funds’ shareholders will
pay their personal expenses, if any, incurred in connection with the
Reorganization.
| 10. |
ENTIRE
AGREEMENT; SURVIVAL OF WARRANTIES |
10.1 This
Agreement constitutes the entire agreement among the parties and supersedes any
prior or contemporaneous understanding or arrangement with respect to the
subject matter hereof.
10.2 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 herein.
| 11. |
TERMINATION |
This
Agreement may be terminated and the transactions contemplated hereby may be
abandoned at any time before the Closing by the mutual consent of the Acquiring
Fund and the Acquired Funds or if any governmental body shall have issued an
order, decree or ruling having the effect of permanently enjoining, restraining
or otherwise prohibiting the consummation of this Agreement. In the event of any
termination pursuant to Section 11 there shall be no liability for damage
on the part of either party to the other party respecting such termination. The
Advisor shall be responsible for out of pocket expenses associated with the
terminated transaction.
| 12. |
AMENDMENTS |
This
Agreement may be amended, modified or supplemented in such manner as may be
mutually agreed upon in writing by the authorized officers of XXXXXXX.xxx, on
behalf of the Acquired Funds, and on behalf of the Acquiring Fund; provided,
however, that following the meeting of the shareholders of the Acquired Funds,
no such amendment may have the effect of changing the provisions for determining
the number of shares of the Acquiring Fund to be distributed to the Acquired
Fund Investors under this Agreement to the detriment of such Acquired Fund
Investors, or otherwise materially and adversely affecting the Acquired Funds,
without the Acquired Funds obtaining the Acquired Fund Investors’ approvals
except that nothing in this paragraph 12 shall be construed to prohibit the
Acquiring Fund and the Acquired Funds from amending this Agreement to change the
Closing Date or Applicable Valuation Date by mutual agreement.
| 13. |
NOTICES |
Any
notice, report, statement or demand required or permitted by any provision of
this Agreement shall be in writing and shall be given by facsimile, certified
mail or overnight express courier addressed to:
For
XXXXXXX.xxx, on behalf of itself and the Acquired and/or Acquiring
Fund(s):
XXXXXXX.xxx
c/o U.S.
Bancorp Fund Services, LLC
000 X.
Xxxxxxxx Xxxxxx
Xxxxxxxxx,
XX 00000
Attention:
Xxx Xxxxxx
President
For
Mutuals Advisors, Inc.:
Mutuals
Advisors, Inc.
Plaza of
the Americas
000 Xxxxx
Xxxxx Xxxxxx, Xxxxx 000
Xxxxxx,
Xxxxx 00000
Attention:
Xxx Xxxxxx
President
| 14. |
HEADINGS;
COUNTERPARTS; GOVERNING LAW; ASSIGNMENT; LIMITATION OF
LIABILITY |
14.1 The
article and paragraph headings contained herein are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement.
All references herein to Articles, paragraphs, subparagraphs or Exhibits shall
be construed as referring to Articles, paragraphs or subparagraphs hereof or
Exhibits hereto, respectively. Whenever the terms “hereto,” “hereunder,”
“herein” or “hereof” are used in this Agreement, they shall be construed as
referring to this entire Agreement, rather than to any individual Article,
paragraph, subparagraph or sentence.
14.2 This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original.
14.3 This
Agreement shall be governed by and construed in accordance with the laws of
Delaware (without regard to rules regarding choice of law).
14.4 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 parties. 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.
IN
WITNESS WHEREOF, each of
the parties hereto has caused this Agreement to be duly executed by its
authorized officer.
XXXXXXX.xxx,
for
itself and on behalf of
Generation
Wave Aggressive Growth Fund and
Generation
Wave Alternative Growth Fund
By: __________________________________
Xxx
X. Xxxxxx
President
XXXXXXX.xxx,
for
itself and on behalf of
the
Generation Wave Growth Fund
By:
__________________________________
Xxx X.
Xxxxxx
President
Mutuals
Advisors, Inc.
with
respect to its obligations under this Agreement:
By:
__________________________________
Xxx X.
Xxxxxx
President
