AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (the "Agreement") is made
as of March 13, 2002, by and between Xxx Xxxxxx Life Investment Trust, a
registered investment company, SEC File No. 811-4424 (the "Trust"), on
behalf of its series, the Asset Allocation Portfolio (the "Acquired
Portfolio") and Xxx Xxxxxx Life Investment Trust, on behalf of its series,
the Enterprise Portfolio (the "Acquiring Portfolio").
W I T N E S S E T H:
WHEREAS, the Board of Trustees of the Acquiring Portfolio (the
"Acquiring Portfolio Board") and the Board of Directors of the Acquired
Portfolio (the "Acquired Portfolio Board") have determined that entering
into this Agreement for the Acquiring Portfolio to acquire the assets and
liabilities of the Acquired Portfolio is in the best interests of the
shareholders of each respective Portfolio; and
WHEREAS, the parties intend that this transaction qualify as a
reorganization within the meaning of Section 368(a) of the Internal
Revenue Code of 1986, as amended (the "Code");
NOW, THEREFORE, in consideration of the mutual promises contained
herein, and intending to be legally bound hereby, the parties hereto agree
as follows:
1. PLAN OF TRANSACTION.
A. TRANSFER OF ASSETS. Upon satisfaction of the conditions
precedent set forth in Sections 7 and 8 hereof, the Acquired Portfolio
will convey, transfer and deliver to the Acquiring Portfolio at the
Closing, provided for in Section 2 hereof, all of the existing assets of
the Acquired Portfolio (including accrued interest to the Closing Date) to
the Acquiring Portfolio as more fully set forth on Schedule 1 hereto, and
as amended from time to time prior to the Closing Date (as defined below),
free and clear of all liens, encumbrances and claims whatsoever (the
assets so transferred collectively being referred to as the "Assets").
B. CONSIDERATION. In consideration thereof, the Acquiring
Portfolio agrees that on the Closing Date the Acquiring Portfolio will (i)
deliver to the Acquired Portfolio, full and fractional Class I and Class
II Shares of beneficial interest, par value $0.01 per share, of the
Acquiring Portfolio having aggregate net asset values in an amount equal
to the aggregate dollar value of the Assets net of any liabilities of the
Acquired Portfolio described in Section 3E hereof (the "Liabilities")
determined pursuant to Section 3A of this Agreement (collectively, the
"Acquiring Portfolio Shares") and (ii) assume all of the Acquired
Portfolio's Liabilities. The calculation of full and fractional Class I
and Class II Shares of the Acquiring Portfolio to be exchanged shall be
carried out to no less than two (2) decimal places. All Acquiring
Portfolio Shares delivered to the Acquired Portfolio in exchange for such
Assets shall be delivered at net asset value without sales load,
commission or other transactional fee being imposed.
2. CLOSING OF THE TRANSACTION.
A. CLOSING DATE. The closing shall occur within fifteen (15)
business days after the later of receipt of all necessary regulatory
approvals and the final adjournment of the meeting of shareholders of the
Acquired Portfolio at which this Agreement will be considered and
approved or such later date as soon as practicable thereafter, as the
parties may mutually agree (the "Closing Date"). On the Closing Date, the
Acquiring Portfolio shall deliver to the Acquired Portfolio the Acquiring
Portfolio Shares in the amount determined pursuant to Section 1B hereof
and the Acquired Portfolio thereafter shall, in order to effect the
distribution of such shares to the Acquired Portfolio shareholders,
instruct the Acquiring Portfolio to register the pro rata interest in the
Acquiring Portfolio Shares (in full and fractional shares) of each of the
holders of record of shares of the Acquired Portfolio in accordance with
their holdings of Class I and Class II shares and shall provide as part of
such instruction a complete and updated list of such holders (including
addresses and taxpayer identification numbers), and the Acquiring
Portfolio agrees promptly to comply with said instruction. The Acquiring
Portfolio shall have no obligation to inquire as to the validity,
propriety or correctness of such instruction, but shall assume that such
instruction is valid, proper and correct.
3. PROCEDURE FOR REORGANIZATION.
A. VALUATION. The value of the Assets and Liabilities of the
Acquired Portfolio to be transferred and assumed, respectively, by the
Acquiring Portfolio shall be computed as of the Closing Date, in the
manner set forth in the most recent Prospectus and Statement of Additional
Information of the Acquiring Portfolio (collectively, the "Acquiring
Portfolio Prospectus"), copies of which have been delivered to the
Acquired Portfolio.
B. DELIVERY OF FUND ASSETS. The Assets shall be delivered to
State Street Bank and Trust Company or other custodian as designated by
the Acquiring Portfolio (collectively the "Custodian") for the benefit of
the Acquiring Portfolio, duly endorsed in proper form for transfer in such
condition as to constitute a good delivery thereof, free and clear of all
liens, encumbrances and claims whatsoever, in accordance with the custom
of brokers, and shall be accompanied by all necessary state stock transfer
stamps, the cost of which shall be borne by Xxx Xxxxxx Asset Management
Inc. ("Asset Management").
C. FAILURE TO DELIVER SECURITIES. If the Acquired Portfolio is
unable to make delivery pursuant to Section 3B hereof to the Custodian of
any of the Acquired Portfolio's securities for the reason that any of such
securities purchased by the Acquiring Portfolio have not yet been
delivered to it by the Acquired Portfolio's broker or brokers, then, in
lieu of such delivery, the Acquired Portfolio shall deliver to the
Custodian, with respect to said securities, executed copies of an
agreement of assignment and due bills executed on behalf of said broker or
brokers, together with such other documents as may be required by the
Acquiring Portfolio or Custodian, including brokers' confirmation slips.
D. SHAREHOLDER ACCOUNTS. The Acquiring Portfolio, in order to
assist the Acquired Portfolio in the distribution of the Acquiring
Portfolio Shares to the Acquired Portfolio shareholders after delivery of
the Acquiring Portfolio Shares to the Acquired Portfolio, will establish
pursuant to the request of the Acquired Portfolio an open account with the
Acquiring Portfolio for each shareholder of the Acquired Portfolio and,
upon request by the Acquired Portfolio, shall transfer to such accounts,
the exact number of full and fractional Class I and Class II Shares of the
Acquiring Portfolio then held by the Acquired Portfolio specified in the
instruction provided pursuant to Section 2 hereof. The Acquiring
Portfolio is not required to issue certificates representing Acquiring
Portfolio Shares unless requested to do so by a shareholder. Upon
liquidation or dissolution of the Acquired Portfolio, certificates
representing shares of beneficial interest of the Acquired Portfolio shall
become null and void.
E. LIABILITIES. The Liabilities shall include all of Acquired
Portfolio's liabilities, debts, obligations, and duties of whatever kind
or nature, whether absolute, accrued, contingent, or otherwise, whether or
not arising in the ordinary course of business, whether or not
determinable at the Closing Date, and whether or not specifically referred
to in this Agreement.
F. EXPENSES. In the event that the transactions contemplated
herein are consummated, Asset Management is paying all the expenses
associated with the Reorganization. In addition, as part of the
Reorganization, the Acquired Portfolio will write off any remaining
unamortized organizational expenses, which shall be reimbursed by Asset
Management. In the event that the transactions contemplated herein are not
consummated for any reason, then all reasonable outside expenses incurred
to the date of termination of this Agreement shall be borne by Asset
Management.
G. DISSOLUTION. As soon as practicable after the Closing Date
but in no event later than one year after the Closing Date, the Acquired
Portfolio shall voluntarily dissolve and completely liquidate by taking,
in accordance with Delaware law and Federal securities laws, all steps as
shall be necessary and proper to effect a complete liquidation and
dissolution of the Acquired Portfolio. Immediately after the Closing
Date, the share transfer books relating to the Acquired Portfolio shall be
closed and no transfer of shares shall thereafter be made on such books.
4. ACQUIRED PORTFOLIO'S REPRESENTATIONS AND WARRANTIES.
The Acquired Portfolio hereby represents and warrants to the
Acquiring Portfolio, which representations and warranties are true and
correct on the date hereof, and agrees with the Acquiring Portfolio that:
A. ORGANIZATION. The Acquired Portfolio is duly formed and in
good standing under the laws of the state of its organization and is duly
authorized to transact business in the state of its organization. The
Acquired Portfolio is qualified to do business in all jurisdictions in
which they are required to be so qualified, except jurisdictions in which
the failure to so qualify would not have a material adverse effect on the
Acquired Portfolio. The Acquired Portfolio has all material federal,
state and local authorizations necessary to own all of the properties and
assets and to carry on its business as now being conducted, except
authorizations which the failure to so obtain would not have a material
adverse effect on the Acquired Portfolio.
B. REGISTRATION. The Acquired Portfolio 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. The Acquired Portfolio is in compliance in all
material respects with the 1940 Act and the rules and regulations
thereunder with respect to its activities. All of the outstanding shares
of beneficial interest of the Acquired Portfolio have been duly authorized
and are validly issued, fully paid and nonassessable and not subject to
pre-emptive or dissenters' rights.
C. AUDITED FINANCIAL STATEMENTS. The statement of assets and
liabilities and the portfolio of investments and the related statements of
operations and changes in net assets of the Acquired Portfolio audited as
of and for the year ended December 31, 2001, true and complete copies of
which have been heretofore furnished to the Acquiring Portfolio, fairly
represent the financial condition and the results of operations of the
Acquired Portfolio as of and for their respective dates and periods in
conformity with generally accepted accounting principles applied on a
consistent basis during the periods involved.
D. FINANCIAL STATEMENTS. The Acquired Portfolio shall furnish to
the Acquiring Portfolio within five (5) business days after the Closing
Date, an unaudited statement of assets and liabilities and the portfolio
of investments and the related statements of operations and changes in net
assets as of and for the interim period ending on the Closing Date; such
financial statements will represent fairly the financial position and
portfolio of investments and the results of the Acquired Portfolio's
operations as of, and for the period ending on, the dates of such
statements in conformity with generally accepted accounting principles
applied on a consistent basis during the periods involved and the results
of its operations and changes in financial position for the period then
ended; and such financial statements shall be certified by the Treasurer
of the Acquired Portfolio as complying with the requirements hereof.
E. CONTINGENT LIABILITIES. There are, and as of the Closing Date
will be, no contingent Liabilities of the Acquired Portfolio not disclosed
in the financial statements delivered pursuant to Sections 4C and 4D which
would materially affect the Acquired Portfolio's financial condition, and
there are no legal, administrative, or other proceedings pending or, to
its knowledge, threatened against the Acquired Portfolio which would, if
adversely determined, materially affect the Acquired Portfolio's financial
condition. All Liabilities were incurred by the Acquired Portfolio in the
ordinary course of its business.
F. MATERIAL AGREEMENTS. The Acquired Portfolio is in compliance
with all material agreements, rules, laws, statutes, regulations and
administrative orders affecting its operations or its assets; and except
as referred to in the Acquired Portfolio's Prospectus, there are no
material agreements outstanding relating to the Acquired Portfolio to
which the Acquired Portfolio is a party.
G. STATEMENT OF EARNINGS. As promptly as practicable, but in any
case no later than 30 calendar days after the Closing Date, the Acquired
Portfolio shall furnish the Acquiring Portfolio with a statement of the
earnings and profits of the Acquired Portfolio within the meaning of the
Code as of the Closing Date.
H. TAX RETURNS. At the date hereof and on the Closing Date, all
Federal and other material tax returns and reports of the Acquired
Portfolio required by law to have been filed by such dates shall have been
filed, and all Federal and other taxes shown thereon shall have been paid
so far as due, or provision shall have been made for the payment thereof,
and to the best of the Acquired Portfolio's knowledge no such return is
currently under audit and no assessment has been asserted with respect to
any such return.
I. CORPORATE AUTHORITY. The Acquired Portfolio has the necessary
power to enter into this Agreement and to consummate the transactions
contemplated herein. The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated herein
have been duly authorized by the Acquired Portfolio Board, and except for
obtaining approval of the holders of the shares of the Acquired Portfolio,
no other corporate acts or proceedings by the Acquired Portfolio are
necessary to authorize this Agreement and the transactions contemplated
herein. This Agreement has been duly executed and delivered by the
Acquired Portfolio and constitutes the legal, valid and binding obligation
of the Acquired Portfolio enforceable in accordance with its terms, except
as such enforceability may be limited by bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or similar law affecting
creditors' rights generally, or by general principals of equity
(regardless of whether enforcement is sought in a proceeding at equity or
law).
J. NO VIOLATION; CONSENTS AND APPROVALS. The execution, delivery
and performance of this Agreement by the Acquired Portfolio does not and
will not (i) violate any provision of the Acquired Portfolio's
organizational documents, (ii) violate any statute, law, judgment, writ,
decree, order, regulation or rule of any court or governmental authority
applicable to the Acquired Portfolio, (iii) result in a violation or
breach of, or constitute a default under any material contract, indenture,
mortgage, loan agreement, note, lease or other instrument or obligation to
which the Acquired Portfolio is subject, or (iv) result in the creation or
imposition or any lien, charge or encumbrance upon any property or assets
of the Acquired Portfolio. Except as set forth in Schedule 2 to this
Agreement, (i) no consent, approval, authorization, order or filing with
or notice to any court or governmental authority or agency is required for
the consummation by the Acquired Portfolio of the transactions
contemplated by this Agreement and (ii) no consent of or notice to any
third party or entity is required for the consummation by the Acquired
Portfolio of the transactions contemplated by this Agreement.
K. ABSENCE OF CHANGES. 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
the Acquired Portfolio, other than changes in the ordinary course of its
business, or any pending or threatened litigation, which has had or may
have a material adverse effect on such business, results of operations,
assets or financial condition;
(2) issued any option to purchase or other right to acquire
shares of the Acquired Portfolio granted by the Acquired Portfolio to any
person other than subscriptions to purchase shares at net asset value in
accordance with terms in the Prospectus for the Acquired Portfolio;
(3) any entering into, amendment or termination of any
contract or agreement by the Acquired Portfolio, except as otherwise
contemplated by this Agreement;
(4) any indebtedness incurred, other than in the ordinary
course of business, by the Acquired Portfolio for borrowed money or any
commitment to borrow money entered into by the Acquired Portfolio;
(5) any amendment of the Acquired Portfolio's organizational
documents; or
(6) any grant or imposition of any lien, claim, charge or
encumbrance (other than encumbrances arising in the ordinary course of
business with respect to covered options) upon any asset of the Acquired
Portfolio other than a lien for taxes not yet due and payable.
L. TITLE. On the Closing Date, the Acquired Portfolio will have
good and marketable title to the Assets, free and clear of all liens,
mortgages, pledges, encumbrances, charges, claims and equities whatsoever,
other than a lien for taxes not yet due and payable, and full right, power
and authority to sell, assign, transfer and deliver such Assets; upon
delivery of such Assets, the Acquiring Portfolio will receive good and
marketable title to such Assets, free and clear of all liens, mortgages,
pledges, encumbrances, charges, claims and equities other than a lien for
taxes not yet due and payable.
M. PROXY STATEMENT/PROSPECTUS. The Registration Statement and
the Proxy Statement/Prospectus contained therein as of the effective date
of the
Registration Statement, and at all times subsequent thereto up to and
including the Closing Date, as amended or as supplemented if it shall have
been amended or supplemented, conform and will conform as it relates to
the Acquired Portfolio, in all material respects, to the applicable
requirements of the applicable Federal and state securities laws and the
rules and regulations of the SEC thereunder, and do not 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, except that no representations or warranties in this
Section 4M apply to statements or omissions made in reliance upon and in
conformity with written information concerning the Acquiring Portfolio
furnished to the Acquired Portfolio by the Acquiring Portfolio.
N. TAX QUALIFICATION. The Acquired Portfolio has qualified as a
regulated investment company within the meaning of Section 851 of the Code
for each of its taxable years; and has satisfied the distribution
requirements imposed by Section 852 of the Code for each of its taxable
years.
O. FAIR MARKET VALUE. The fair market value on a going concern
basis of the Assets will equal or exceed the Liabilities to be assumed by
the Acquiring Portfolio and those to which the Assets are subject.
P. ACQUIRED PORTFOLIO LIABILITIES. Except as otherwise provided
for herein, the Acquired Portfolio shall use reasonable efforts,
consistent with its ordinary operating procedures, to repay in full any
indebtedness for borrowed money and have discharged or reserved against
all of the Acquired Portfolio's known debts, liabilities and obligations
including expenses, costs and charges whether absolute or contingent,
accrued or unaccrued.
5. THE ACQUIRING PORTFOLIO'S REPRESENTATIONS AND WARRANTIES.
The Acquiring Portfolio hereby represents and warrants to the
Acquired Portfolio, which representations and warranties are true and
correct on the date hereof, and agrees with the Acquired Portfolio that:
A. ORGANIZATION. The Acquiring Portfolio is duly formed and in
good standing under the laws of the state of its organization and is duly
authorized to transact business in the state of its organization. The
Acquiring Portfolio is qualified to do business in all jurisdictions in
which it is required to be so qualified, except jurisdictions in which the
failure to so qualify would not have a material adverse effect on the
Acquiring Portfolio. The Acquiring Portfolio has all material federal,
state and local authorizations necessary to own all of the properties and
assets and to carry on its business and the business thereof as now being
conducted, except authorizations which the failure to so obtain would not
have a material adverse effect on the Acquiring Portfolio.
B. REGISTRATION. The Acquiring Portfolio is registered under the
1940 Act as an open-end, management investment company and such
registration has not been revoked or rescinded. The Acquiring Portfolio
is in compliance in all material respects with the 1940 Act and the rules
and regulations thereunder. All of the outstanding shares of beneficial
interest, par value $0.01 per share, of the Acquiring Portfolio have been
duly authorized and are validly issued, fully paid and non-assessable and
not subject to pre-emptive or dissenters' rights.
C. AUDITED FINANCIAL STATEMENTS. The statement of assets and
liabilities and the portfolio of investments and the related statements of
operations and changes in net assets of the Acquiring Portfolio audited as
of and for the year ended December 31, 2001, true and complete copies of
which have been heretofore furnished to the Acquired Portfolio, fairly
represent the financial condition and the results of operations of the
Acquiring Portfolio as of and for their respective dates and periods in
conformity with generally accepted accounting principles applied on a
consistent basis during the periods involved.
D. FINANCIAL STATEMENTS. The Acquiring Portfolio shall furnish
to the Acquired Portfolio within five (5) business days after the Closing
Date, an unaudited statement of assets and liabilities and the portfolio
of investments and the related statements of operations and changes in net
assets as of and for the interim period ending on the Closing Date; such
financial statements will represent fairly the financial position and
portfolio of investments and the results of its operations as of, and for
the period ending on, the dates of such statements in conformity with
generally accepted accounting principles applied on a consistent basis
during the period involved and the results of its operations and changes
in financial position for the periods then ended; and such financial
statements shall be certified by the Treasurer of the Acquiring Portfolio
as complying with the requirements hereof.
E. CONTINGENT LIABILITIES. There are no contingent liabilities
of the Acquiring Portfolio not disclosed in the financial statements
delivered pursuant to Sections 5C and 5D which would materially affect the
Acquiring Portfolio's financial condition, and there are no legal,
administrative, or other proceedings pending or, to its knowledge,
threatened against the Acquiring Portfolio which would, if adversely
determined, materially affect the Acquiring Portfolio's financial
condition.
F. MATERIAL AGREEMENTS. The Acquiring Portfolio is in compliance
with all material agreements, rules, laws, statutes, regulations and
administrative orders affecting its operations or its assets; and except
as referred to in the Acquiring Portfolio Prospectus and Statement of
Additional Information there are no material agreements outstanding to
which the Acquiring Portfolio is a party.
G. TAX RETURNS. At the date hereof and on the Closing Date, all
Federal and other material tax returns and reports of the Acquiring
Portfolio required by law to have been filed by such dates shall have been
filed, and all Federal and other taxes shall have been paid so far as due,
or provision shall have been made for the payment thereof, and to the best
of the Acquiring Portfolio's knowledge no such return is currently under
audit and no assessment has been asserted with respect to any such return.
H. CORPORATE AUTHORITY. The Acquiring Portfolio has the
necessary power to enter into this Agreement and to consummate the
transactions contemplated herein. The execution, delivery and performance
of this Agreement and the consummation of the transactions contemplated
herein have been duly authorized by the Acquiring Portfolio Board, no
other corporate acts or proceedings by the Acquiring Portfolio are
necessary to authorize this Agreement and the transactions contemplated
herein. This Agreement has been duly executed and delivered by the
Acquiring Portfolio and constitutes a valid and binding obligation of the
Acquiring Portfolio enforceable in accordance with its terms, except as
such enforceability may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium or similar law affecting creditors'
rights generally, or by general principals of equity (regardless of
whether enforcement is sought in a proceeding at equity or law).
I. NO VIOLATION; CONSENTS AND APPROVALS. The execution, delivery
and performance of this Agreement by the Acquiring Portfolio does not and
will not (i) result in a material violation of any provision of the
Acquiring Portfolio's organizational documents, (ii) violate any statute,
law, judgment, writ, decree, order, regulation or rule of any court or
governmental authority applicable to the Acquiring Portfolio or (iii)
result in a material violation or breach of, or constitute a default
under, any material contract, indenture, mortgage, loan agreement, note,
lease or other instrument or obligation to which the Acquiring Portfolio
is subject, or (iv) result in the creation or imposition or any lien,
charge or encumbrance upon any property or assets of the Acquiring
Portfolio. Except as set forth in Schedule 3 to this Agreement, (i) no
consent, approval, authorization, order or filing with notice to any court
or governmental authority or agency is required for the consummation by
the Acquiring Portfolio of the transactions contemplated by this Agreement
and (ii) no consent of or notice to any third party or entity is required
for the consummation by the Acquiring Portfolio of the transactions
contemplated by this Agreement.
J. ABSENCE OF PROCEEDINGS. There are no legal, administrative or
other proceedings pending or, to its knowledge, threatened against the
Acquiring Portfolio which would materially affect its financial condition.
K. SHARES OF THE ACQUIRING PORTFOLIO: REGISTRATION. The
Acquiring Portfolio Shares to be issued pursuant to Section 1 hereof will
be duly registered under the Securities Act and all applicable state
securities laws.
L. SHARES OF THE ACQUIRING PORTFOLIO: AUTHORIZATION. The shares
of beneficial interest of the Acquiring Portfolio to be issued pursuant to
Section 1 hereof have been duly authorized and, when issued in accordance
with this Agreement, will be validly issued and fully paid and non-
assessable by the Acquiring Portfolio and conform in all material respects
to the description thereof contained in the Acquiring Portfolio's
Prospectus furnished to the Acquired Portfolio.
M. ABSENCE OF CHANGES. From the date hereof through the Closing
Date, there shall not have been any change in the business, results of
operations, assets or financial condition or the manner of conducting the
business of the Acquiring Portfolio, other than changes in the ordinary
course of its business, which has had a material adverse effect on such
business, results of operations, assets or financial condition.
N. REGISTRATION STATEMENT. The Registration Statement and the
Prospectus/Proxy Statement contained therein as of the effective date of
the Registration Statement, and at all times subsequent thereto up to and
including the Closing Date, as amended or as supplemented if they shall
have been amended or supplemented, conforms and will conform, as it
relates to the Acquiring Portfolio, in all material respects, to the
applicable requirements of the applicable Federal securities laws and the
rules and regulations of the SEC thereunder, and do not 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, except that no representations or warranties in this
Section 5 apply to statements or omissions made in reliance upon and in
conformity with written information concerning the Acquired Portfolio
furnished to the Acquiring Portfolio by the Acquired Portfolio.
O. TAX QUALIFICATION. The Acquiring Portfolio has qualified as a
regulated investment company within the meaning of Section 851 of the Code
for each of its taxable years; and has satisfied the distribution
requirements imposed by Section 852 of the Code for each of its taxable
years.
6. COVENANTS.
During the period from the date of this Agreement and continuing
until the Closing Date the Acquired Portfolio and Acquiring Portfolio each
agrees that (except as expressly contemplated or permitted by this
Agreement):
A. OTHER ACTIONS. The Acquired Portfolio and Acquiring Portfolio
shall operate only in the ordinary course of business consistent with
prior practice. No party shall take any action that would, or reasonably
would be expected to, result in any of its representations and warranties
set forth in this Agreement being or becoming untrue in any material
respect.
B. GOVERNMENT FILINGS; CONSENTS. The Acquired Portfolio and
Acquiring Portfolio shall file all reports required to be filed by the
Acquired Portfolio and Acquiring Portfolio with the SEC between the date
of this Agreement and the Closing Date and shall deliver to the other
party copies of all such reports promptly after the same are filed.
Except where prohibited by applicable statutes and regulations, each party
shall promptly provide the other (or its counsel) with copies of all other
filings made by such party with any state, local or federal government
agency or entity in connection with this Agreement or the transactions
contemplated hereby. Each of the Acquired Portfolio and the Acquiring
Portfolio shall use all reasonable efforts to obtain all consents,
approvals and authorizations required in connection with the consummation
of the transactions contemplated by this Agreement and to make all
necessary filings with the appropriate Secretary of State.
C. PREPARATION OF THE REGISTRATION STATEMENT AND THE PROXY
STATEMENT/ PROSPECTUS. In connection with the Registration Statement and
the Proxy Statement/Prospectus, each party hereto will cooperate with the
other and furnish to the other the information relating to the Acquired
Portfolio or Acquiring Portfolio, as the case may be, required by the
Securities Act or the Exchange Act and the rules and regulations
thereunder, as the case may be, to be set forth in the Registration
Statement or the Proxy Statement/Prospectus, as the case may be. The
Acquired Portfolio shall promptly prepare for filing with the SEC the
Proxy Statement/Prospectus and the Acquiring Portfolio shall promptly
prepare and file with the SEC the Registration Statement, in which the
Proxy Statement/Prospectus will be included as a prospectus. In
connection with the Registration Statement, insofar as it relates to the
Acquired Portfolio and its affiliated persons, the Acquiring Portfolio
shall only include such information as is approved by the Acquired
Portfolio for use in the Registration Statement. The Acquiring Portfolio
shall not amend or supplement any such information regarding the Acquired
Portfolio and such affiliates without the prior written consent of the
Acquired Portfolio which consent shall not unreasonably withheld or
delayed. The Acquiring Portfolio shall promptly notify and provide the
Acquired Portfolio with copies of all amendments or supplements filed with
respect to the Registration Statement. The Acquiring Portfolio shall use
all reasonable efforts to have the Registration Statement declared
effective under the Securities Act as promptly as practicable after such
filing. The Acquiring Portfolio shall also take any action (other than
qualifying to do business in any jurisdiction in which it is now not so
qualified) required to be taken under any applicable state securities laws
in connection with the issuance of the Acquiring Portfolio's shares of
beneficial interest in the transactions contemplated by this Agreement,
and the Acquired Portfolio shall furnish all information concerning the
Acquired Portfolio and the holders of the Acquired Portfolio's shares of
beneficial interest as may be reasonably requested in connection with any
such action.
D. ACCESS TO INFORMATION. During the period prior to the Closing
Date, the Acquired Portfolio shall make available to the Acquiring
Portfolio a copy of each report, schedule, registration statement and
other document (the "Documents") filed or received by it during such
period pursuant to the requirements of Federal or state securities laws or
Federal or state banking laws (other than Documents which such party is
not permitted to disclose under applicable law). During the period prior
to the Closing Date, the Acquiring Portfolio shall make available to the
Acquired Portfolio each Document pertaining to the transactions
contemplated hereby filed or received by it during such period pursuant to
Federal or state securities laws or Federal or state banking laws (other
than Documents which such party is not permitted to disclose under
applicable law).
E. SHAREHOLDERS MEETING. The Acquired Portfolio shall call a
meeting of the Acquired Portfolio shareholders to be held as promptly as
practicable for the purpose of voting upon the approval of this Agreement
and the transactions contemplated herein, and shall furnish a copy of the
Proxy Statement/Prospectus and form of proxy to each shareholder of the
Acquired Portfolio as of the record date for such meeting of shareholders.
The Board shall recommend to the Acquired Portfolio shareholders approval
of this Agreement and the transactions contemplated herein, subject to
fiduciary obligations under applicable law.
F. COORDINATION OF PORTFOLIOS. The Acquired Portfolio and
Acquiring Portfolio covenant and agree to coordinate the respective
portfolios of the Acquired Portfolio and Acquiring Portfolio from the date
of the Agreement up to and including the Closing Date in order that at
Closing, when the Assets are added to the Acquiring Portfolio's portfolio,
the resulting portfolio will meet the Acquiring Portfolio's investment
objective, policies and restrictions, as set forth in the Acquiring
Portfolio's Prospectus, a copy of which has been delivered to the Acquired
Portfolio.
G. DISTRIBUTION OF THE SHARES. At Closing the Acquired Portfolio
covenants that it shall cause to be distributed the Acquiring Portfolio
Shares in the proper pro rata amount for the benefit of Acquired
Portfolio's shareholders and such that the Acquired Portfolio shall not
continue to hold amounts of said shares so as to cause a violation of
Section 12(d)(1) of the 1940 Act. The Acquired Portfolio covenants
further that, pursuant to Section 3G, it shall liquidate and dissolve as
promptly as practicable after the Closing Date. The Acquired Portfolio
covenants to use all reasonable efforts to cooperate with the Acquiring
Portfolio and the Acquiring Portfolio's transfer agent in the distribution
of said shares.
H. BROKERS OR FINDERS. Except as disclosed in writing to the
other party prior to the date hereof, each of the Acquired Portfolio and
the Acquiring Portfolio represents that no agent, broker, investment
banker, financial advisor or other firm or person is or will be entitled
to any broker's or finder's fee or any other commission or similar fee in
connection with any of the transactions contemplated by this Agreement,
and each party shall hold the other harmless from and against any and all
claims, liabilities or obligations with respect to any such fees,
commissions or expenses asserted by any person to be due or payable in
connection with any of the transactions contemplated by this Agreement on
the basis of any act or statement alleged to have been made by such first
party or its affiliate.
I. ADDITIONAL AGREEMENT. In case at any time after the Closing
Date any further action is necessary or desirable in order to carry out
the purposes of this Agreement the proper officers and trustees of each
party to this Agreement shall take all such necessary action.
J. PUBLIC ANNOUNCEMENTS. For a period of time from the date of
this Agreement to the Closing Date, the Acquired Portfolio and the
Acquiring Portfolio will consult with each other before issuing any press
releases or otherwise making any public statements with respect to this
Agreement or the transactions contemplated herein and shall not issue any
press release or make any public statement prior to such consultation,
except as may be required by law or the rules of any national securities
exchange on which such party's securities are traded.
K. TAX STATUS OF REORGANIZATION. The intention of the parties is
that the transaction will qualify as a reorganization within the meaning
of Section 368(a) of the Code. Neither the Acquiring Portfolio nor the
Acquired Portfolio shall take any action, or cause any action to be taken
(including, without limitation, the filing of any tax return) that is
inconsistent with such treatment or results in the failure of the
transaction to qualify as a reorganization within meaning of Section
368(a) of the Code. At or prior to the Closing Date, the Acquiring
Portfolio and the Acquired Portfolio will take such action, or cause such
action to be taken, as is reasonably necessary to enable Skadden, Arps,
Slate, Xxxxxxx & Xxxx (Illinois), counsel to the Acquired Portfolio, to
render the tax opinion required herein.
L. DECLARATION OF DIVIDEND. At or immediately prior to the
Closing Date, the Acquired Portfolio shall declare and pay to its
stockholders a dividend or other distribution in an amount large enough so
that it will have distributed substantially all (and in any event not less
than 98%) of its investment company taxable income (computed without
regard to any deduction for dividends paid) and realized net capital gain,
if any, for the current taxable year through the Closing Date.
7. CONDITIONS TO OBLIGATIONS OF THE ACQUIRED PORTFOLIO.
The obligations of the Acquired Portfolio hereunder with respect to
the consummation of the Reorganization are subject to the satisfaction, or
waiver by the Acquired Portfolio, of the following conditions:
A. SHAREHOLDER APPROVAL. This Agreement and the transactions
contemplated herein shall have been approved by the affirmative vote of
the holders of a majority of the outstanding shares of beneficial interest
the Acquired Portfolio.
B. REPRESENTATIONS, WARRANTIES AND AGREEMENTS. Each of the
representations and warranties of the Acquiring Portfolio contained herein
shall be true in all material respects as of the Closing Date, and as of
the Closing Date there shall have been no material adverse change in the
financial condition, results of operations, business properties or assets
of the Acquiring Portfolio, and the Acquired Portfolio shall have received
a certificate of an officer of the Acquiring Portfolio satisfactory in
form and substance to the Acquired Portfolio so stating. The Acquiring
Portfolio shall have performed and complied in all material respects with
all agreements, obligations and covenants required by this Agreement to be
so performed or complied with by it on or prior to the Closing Date.
C. REGISTRATION STATEMENT EFFECTIVE. The Registration Statement
shall have become effective and no stop orders under the Securities Act
pertaining thereto shall have been issued.
D. REGULATORY APPROVAL. All necessary approvals, registrations,
and exemptions under federal and state securities laws shall have been
obtained.
E. NO INJUNCTIONS OR RESTRAINTS; ILLEGALITY. No temporary
restraining order, preliminary or permanent injunction or other order
issued by any court of competent jurisdiction or other legal restraint or
prohibition (an "Injunction") preventing the consummation of the
transactions contemplated by this Agreement shall be in effect, nor shall
any proceeding by any state, local or federal government agency or entity
asking any of the foregoing be pending. There shall not have been any
action taken or any statute, rule, regulation or order enacted, entered,
enforced or deemed applicable to the transactions contemplated by this
Agreement, which makes the consummation of the transactions contemplated
by this Agreement illegal or which has a material adverse effect on
business operations of the Acquiring Portfolio.
F. TAX OPINION. The Acquired Portfolio shall have obtained an
opinion from Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois), counsel for
the Acquired Portfolio, dated as of the Closing Date, addressed to the
Acquired Portfolio, that the consummation of the transactions set forth in
this Agreement comply with the requirements of a reorganization as
described in Section 368(a) of the Code.
G. OPINION OF COUNSEL. The Acquired Portfolio shall have
received the opinion of Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois),
counsel for the Acquiring Portfolio, dated as of the Closing Date,
addressed to the Acquired Portfolio substantially in the form and to the
effect that: (i) the Trust is duly formed and validly existing under the
laws of its State of organization; (ii) the Acquiring Portfolio is duly
designated as a series of the Trust; (iii) the Acquiring Portfolio is
registered as an open-end, management investment company under the 1940
Act; (iv) this Agreement and the reorganization provided for herein and
the execution of this Agreement have been duly authorized and approved by
all requisite action of the Trust on behalf of the Acquiring Portfolio and
this Agreement has been duly executed and delivered by the Trust on behalf
of the Acquiring Portfolio and (assuming the Agreement is a valid and
binding obligation of the other parties thereto) is a valid and binding
obligation of the Trust on behalf of the Acquiring Portfolio; (v) neither
the execution or delivery by the Trust on behalf of the Acquiring
Portfolio of this Agreement nor the consummation by the Acquiring
Portfolio of the transactions contemplated thereby violate any provision
of any statute or any published regulation or any judgment or order
disclosed to counsel by the Trust or the Acquiring Portfolio as being
applicable to the Trust or the Acquiring Portfolio; (vi) the Acquiring
Portfolio's Shares have been duly authorized and upon issuance thereof in
accordance with this Agreement will be validly issued and fully paid; and
(vii) to their knowledge and subject to the qualifications set forth
below, the execution and delivery by the Trust on behalf of Acquiring
Portfolio of the Agreement and the consummation of the transactions
therein contemplated do not require, under the laws of the State of
organization or any state in which the Acquiring Portfolio is qualified to
do business or the federal laws of the United States, the consent,
approval, authorization, registration, qualification or order of, or
filing with, any court or governmental agency or body (except such as have
been obtained). Counsel need express no opinion, however, as to any such
consent, approval, authorization, registration, qualification, order or
filing (a) which may be required as a result of the involvement of other
parties to the Agreement in the transactions contemplated by the Agreement
because of their legal or regulatory status or because of any other facts
specifically pertaining to them; (b) the absence of which does not deprive
the Acquired Portfolio of any material benefit under the Agreement; or (c)
which can be readily obtained without significant delay or expense to the
Acquired Portfolio, without loss to the Acquired Portfolio of any material
benefit under the Agreement and without any material adverse effect on the
Acquired Portfolio during the period such consent, approval,
authorization, registration, qualification or order was obtained. The
foregoing opinion relates only to consents, approvals, authorizations,
registrations, qualifications, orders or filings under (a) laws which are
specifically referred to in this opinion, (b) laws of the State of
organization or any state in which the Acquiring Portfolio is qualified to
do business and the federal laws of the United States which, in counsel's
experience, are normally applicable to transactions of the type provided
for in the Agreement and (c) court orders and judgments disclosed to
counsel by the Trust or the Acquiring Portfolio in connection with the
opinion. In addition, although counsel need not have specifically
considered the possible applicability to the Acquiring Portfolio of any
other laws, orders or judgments, nothing has come to their attention in
connection with their representation of the Acquiring Portfolio in this
transaction that has caused them to conclude that any other consent,
approval, authorization, registration, qualification, order or filing is
required.
H. OFFICER CERTIFICATES. The Acquired Portfolio shall have
received a certificate of an authorized officer of the Acquiring
Portfolio, dated as of the Closing Date, certifying that the
representations and warranties set forth in Section 5 are true and correct
on the Closing Date, together with certified copies of the resolutions
adopted by the Acquiring Portfolio Board shall be furnished to the
Acquired Portfolio.
8. CONDITIONS TO OBLIGATIONS OF ACQUIRING PORTFOLIO.
The obligations of the Acquiring Portfolio hereunder with respect to
the consummation of the Reorganization are subject to the satisfaction, or
written waiver by the Acquiring Portfolio of the following conditions:
A. SHAREHOLDER APPROVAL. This Agreement and the transactions
contemplated herein shall have been approved by the affirmative vote of
the holders of a majority of the outstanding shares of common stock of the
Acquired Portfolio.
B. REPRESENTATIONS, WARRANTIES AND AGREEMENTS. Each of the
representations and warranties of the Acquired Portfolio contained herein
shall be true in all material respects as of the Closing Date, and as of
the Closing Date there shall have been no material adverse change in the
financial condition, results of operations, business, properties or assets
of the Acquired Portfolio, and the Acquiring Portfolio shall have received
a certificate of an authorized officer of the Acquired Portfolio
satisfactory in form and substance to the Acquiring Portfolio so stating.
The Acquired Portfolio shall have performed and complied in all material
respects with all agreements, obligations and covenants required by this
Agreement to be so performed or complied with by them on or prior to the
Closing Date.
C. REGISTRATION STATEMENT EFFECTIVE. The Registration Statement
shall have become effective and no stop orders under the Securities Act
pertaining thereto shall have been issued.
D. REGULATORY APPROVAL. All necessary approvals, registrations,
and exemptions under federal and state securities laws shall have been
obtained.
E. NO INJUNCTIONS OR RESTRAINTS: ILLEGALITY. No injunction
preventing the consummation of the transactions contemplated by this
Agreement shall be in effect, nor shall any proceeding by any state, local
or federal government agency or entity seeking any of the foregoing be
pending. There shall not be any action taken, or any statute, rule,
regulation or order enacted, entered, enforced or deemed applicable to the
transactions contemplated by this Agreement, which makes the consummation
of the transactions contemplated by this Agreement illegal.
F. TAX OPINION. The Acquiring Portfolio shall have obtained an
opinion from Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois), counsel for
the Acquired Portfolio, dated as of the Closing Date, addressed to the
Acquiring Portfolio, that the consummation of the transactions set forth
in this Agreement comply with the requirements of a reorganization as
described in Section 368(a) of the Code.
G. OPINION OF COUNSEL. The Acquiring Portfolio shall have
received the opinion of Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois),
counsel for the Trust on behalf of the Acquired Portfolio, dated as of
the Closing Date, addressed to the Acquiring Portfolio, substantially in
the form and to the effect that: (i) the Acquired Portfolio is duly formed
and validly existing under the laws of its state of organization; (ii) the
Acquired Portfolio is duly designated as a series of the Trust; (iii) the
Acquired Portfolio is registered as an open-end, management investment
company under the 1940 Act; (iv) this Agreement and the reorganization
provided for herein and the execution of this Agreement have been duly
authorized by all requisite action of the Trust on behalf of the Acquired
Portfolio and this Agreement has been duly executed and delivered by the
Trust on behalf of the Acquired Portfolio and (assuming the Agreement is a
valid and binding obligation of the other parties thereto) is a valid and
binding obligation of the Trust on behalf of the Acquired Portfolio; (v)
neither the execution or delivery by the Acquired Portfolio of this
Agreement nor the consummation by the Acquired Portfolio of the
transactions contemplated thereby violate any provision of any statute, or
any published regulation or any judgment or order disclosed to them by the
Trust or the Acquired Portfolio as being applicable to the Trust or the
Acquired Portfolio; and (vi) to their knowledge and subject to the
qualifications set forth below, the execution and delivery by the Trust on
behalf of the Acquired Portfolio of the Agreement and the consummation of
the transactions therein contemplated do not require, under the laws of
the State of organization or any state in which the Acquired Portfolio is
qualified to do business, or the federal laws of the United States, the
consent, approval, authorization, registration, qualification or order of,
or filing with, any court or governmental agency or body (except such as
have been obtained under the Securities Act, the 1940 Act or the rules and
regulations thereunder.) Counsel need express no opinion, however, as to
any such consent, approval, authorization, registration, qualification,
order or filing; (a) which may be required as a result of the involvement
of other parties to the Agreement in the transactions contemplated by the
Agreement because of their legal or regulatory status or because of any
other facts specifically pertaining to them; (b) the absence of which does
not deprive the Acquiring Portfolio of any material benefit under such
agreements; or (c) which can be readily obtained without significant delay
or expense to the Acquiring Portfolio, without loss to the Acquiring
Portfolio of any material benefit under the Agreement and without any
material adverse effect on them during the period such consent, approval,
authorization, registration, qualification or order was obtained. The
foregoing opinion relates only to consents, approvals, authorizations,
registrations, qualifications, orders or filings under (a) laws which are
specifically referred to in the opinion, (b) laws of the State of
organization or any State in which the Acquired Portfolio is qualified to
do business and the federal laws of the United States which, in our
experience, are normally applicable to transactions of the type provided
for in the Agreement and (c) court orders and judgments disclosed to them
by the Trust or the Acquired Portfolio in connection with the opinion. In
addition, although counsel need not have specifically considered the
possible applicability to the Acquired Portfolio of any other laws, orders
or judgments, nothing has come to their attention in connection with their
representation of the Acquired Portfolio in this transaction that has
caused them to conclude that any other consent, approval, authorization,
registration, qualification, order or filing is required.
H. THE ASSETS. The Assets, as set forth in Schedule 1, as
amended, shall consist solely of securities which are in conformity with
the Acquiring Portfolio's investment objectives, policies and restrictions
as set forth in the Acquiring Portfolio's Prospectus, a copy of which has
been delivered to the Acquired Portfolio.
I. SHAREHOLDER LIST. The Acquired Portfolio shall have delivered
to the Acquiring Portfolio an updated list of all shareholders of the
Acquired Portfolio, as reported by the Acquired Portfolio's transfer
agent, as of one (1) business day prior to the Closing Date with each
shareholder's respective holdings in the Acquired Portfolio, taxpayer
identification numbers, Form W9 and last known address.
J. OFFICER CERTIFICATES. The Acquiring Portfolio shall have
received a certificate of an authorized officer of the Acquired Portfolio,
dated as of the Closing Date, certifying that the representations and
warranties set forth in Section 4 are true and correct on the Closing
Date, together with certified copies of the resolutions adopted by the
Acquired Portfolio Board and shareholders.
9. AMENDMENT, WAIVER AND TERMINATION.
A. The parties hereto may, by agreement in writing authorized by
the respective Boards, amend this Agreement at any time before or after
approval thereof by the shareholders of the Acquired Portfolio; provided,
however, that after receipt of Acquired Portfolio shareholder approval, no
amendment shall be made by the parties hereto which substantially changes
the terms of Sections 1, 2 and 3 hereof without obtaining Acquired
Portfolio's shareholder approval thereof.
B. At any time prior to the Closing Date, either of the parties
may by written instrument signed by it (i) waive any inaccuracies in the
representations and warranties made to it contained herein and (ii) waive
compliance with any of the covenants or conditions made for its benefit
contained herein. No delay on the part of either party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor
shall any waiver on the part of any party of any such right, power or
privilege, or any single or partial exercise of any such right, power or
privilege, preclude any further exercise thereof or the exercise of any
other such right, power or privilege.
C. This Agreement may be terminated, and the transactions
contemplated herein may be abandoned at any time prior to the Closing
Date:
(1) by the mutual consents of the respective Boards of the
Acquired Portfolio and the Acquiring Portfolio;
(2) by the Acquired Portfolio, if the Acquiring Portfolio
breaches in any material respect any of its representations, warranties,
covenants or agreements contained in this Agreement;
(3) by the Acquiring Portfolio, if the Acquired Portfolio
breaches in any material respect any of its representations, warranties,
covenants or agreements contained in this Agreement;
(4) by either the Acquired Portfolio or Acquiring Portfolio,
if the Closing has not occurred on or prior to December 31, 2002 (provided
that the rights to terminate this Agreement pursuant to this subsection
(C)(4) shall not be available to any party whose failure to fulfill any of
its obligations under this Agreement has been the cause of or resulted in
the failure of the Closing to occur on or before such date);
(5) by the Acquiring Portfolio in the event that: (a) all
the conditions precedent to the Acquired Portfolio's obligation to close,
as set forth in Section 7 of this Agreement, have been fully satisfied (or
can be fully satisfied at the Closing); (b) the Acquiring Portfolio gives
the Acquired Portfolio written assurance of its intent to close
irrespective of the satisfaction or nonsatisfaction of all conditions
precedent to the Acquiring Portfolio's obligation to close, as set forth
in Section 8 of this Agreement; and (c) the Acquired Portfolio then fails
or refuses to close within the earlier of five (5) business days or
December 31, 2002; or
(6) by the Acquired Portfolio in the event that: (a) all the
conditions precedent to the Acquiring Portfolio's obligation to close, as
set forth in Section 8 of this Agreement, have been fully satisfied (or
can be fully satisfied at the Closing); (b) the Acquired Portfolio gives
the Acquiring Portfolio written assurance of its intent to close
irrespective of the satisfaction or nonsatisfaction of all the conditions
precedent to the Acquired Portfolio's obligation to close, as set forth in
Section 7 of this Agreement; and (c) the Acquiring Portfolio then fails or
refuses to close within the earlier of five (5) business days or December
31, 2002.
10. REMEDIES.
In the event of termination of this Agreement by either or both of
the Acquired Portfolio and Acquiring Portfolio pursuant to Section 9C,
written notice thereof shall forthwith be given by the terminating party
to the other party hereto, and this Agreement shall therefore terminate
and become void and have no effect, and the transactions contemplated
herein and thereby shall be abandoned, without further action by the
parties hereto.
11. SURVIVAL OF WARRANTIES AND INDEMNIFICATION.
A. SURVIVAL. The representations and warranties included or
provided for herein, or in the schedules or other instruments delivered or
to be delivered pursuant hereto, shall survive the Closing Date for a
three year period except that any representation or warranty with respect
to taxes shall survive for the expiration of the statutory period of
limitations for assessments of tax deficiencies as the same may be
extended from time to time by the taxpayer. The covenants and agreements
included or provided for herein shall survive and be continuing
obligations in accordance with their terms. The period for which a
representation, warranty, covenant or agreement survives shall be referred
to hereinafter as the "Survival Period." Notwithstanding anything set
forth in the immediately preceding sentence, the Acquiring Portfolio's and
the Acquired Portfolio's right to seek indemnity pursuant to this
Agreement shall survive for a period of ninety (90) days beyond the
expiration of the Survival Period of the representation, warranty,
covenant or agreement upon which indemnity is sought. In no event shall
the Acquiring Portfolio or the Acquired Portfolio be obligated to
indemnify the other if indemnity is not sought within ninety (90) days of
the expiration of the applicable Survival Period.
B. INDEMNIFICATION. Each party (an "Indemnitor") shall indemnify
and hold the other and its officers, trustees, agents and persons
controlled by or controlling any of them (each an "Indemnified Party")
harmless from and against any and all losses, damages, liabilities,
claims, demands, judgments, settlements, deficiencies, taxes, assessments,
charges, costs and expenses of any nature whatsoever (including reasonable
attorneys' fees) including amounts paid in satisfaction of judgments, in
compromise or as fines and penalties, and counsel fees reasonably incurred
by such Indemnified Party in connection with the defense or disposition of
any claim, action, suit or other proceeding, whether civil or criminal,
before any court or administrative or investigative body in which such
Indemnified Party may be or may have been involved as a party or otherwise
or with which such Indemnified Party may be or may have been threatened
(collectively, the "Losses") arising out of or related to any claim of a
breach of any representation, warranty or covenant made herein by the
Indemnitor, provided, however, that no Indemnified Party shall be
indemnified hereunder against any Losses arising directly from such
Indemnified Party's (i) willful misfeasance, (ii) bad faith, (iii) gross
negligence or (iv) reckless disregard of the duties involved in the
conduct of such Indemnified Party's position.
C. INDEMNIFICATION PROCEDURE. The Indemnified Party shall use
its best efforts to minimize any liabilities, damages, deficiencies,
claims, judgments, assessments, costs and expenses in respect of which
indemnity may be sought hereunder. The Indemnified Party shall give
written notice to Indemnitor within the earlier of ten (10) days of
receipt of written notice to Indemnified Party or thirty (30) days from
discovery by Indemnified Party of any matters which may give rise to a
claim for indemnification or reimbursement under this Agreement. The
failure to give such notice shall not affect the right of Indemnified
Party to indemnity hereunder unless such failure has materially and
adversely affected the rights of the Indemnitor; provided that in any
event such notice shall have been given prior to the expiration of the
Survival Period. At any time after ten (10) days from the giving of such
notice, Indemnified Party may, at its option, resist, settle or otherwise
compromise, or pay such claim unless it shall have received notice from
Indemnitor that Indemnitor intends, at Indemnitor's sole cost and expense,
to assume the defense of any such matter, in which case Indemnified Party
shall have the right, at no cost or expense to Indemnitor, to participate
in such defense. If Indemnitor does not assume the defense of such
matter, and in any event until Indemnitor states in writing that it will
assume the defense, Indemnitor shall pay all costs of Indemnified Party
arising out of the defense until the defense is assumed; provided,
however, that Indemnified Party shall consult with Indemnitor and obtain
indemnitor's prior written consent to any payment or settlement of any
such claim. Indemnitor shall keep Indemnified Party fully apprised at all
times as to the status of the defense. If Indemnitor does not assume the
defense, Indemnified Party shall keep Indemnitor apprised at all times as
to the status of the defense. Following indemnification as provided for
hereunder, Indemnitor shall be subrogated to all rights of Indemnified
Party with respect to all third parties, firms or corporations relating to
the matter for which indemnification has been made.
12. SURVIVAL.
The provisions set forth in Sections 10, 11 and 16 hereof shall
survive the termination of this Agreement for any cause whatsoever.
13. NOTICES.
All notices hereunder shall be sufficiently given for all purposes
hereunder if in writing and delivered personally or sent by registered
mail or certified mail, postage prepaid. Notice to the Acquired Portfolio
shall be addressed to the Acquired Portfolio c/o Xxx Xxxxxx Asset
Management Inc., 0 Xxxxxxxx Xxxxx, X.X. Xxx 0000, Xxxxxxxx Terrace,
Illinois 60181-5555, Attention: General Counsel, or at such other address
as the Acquired Portfolio may designate by written notice to the Acquiring
Portfolio. Notice to the Acquiring Portfolio shall be addressed to the
Acquiring Portfolio c/o Xxx Xxxxxx Asset Management Inc., 0 Xxxxxxxx
Xxxxx, X.X. Xxx 0000, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000, Attention: General
Counsel, or at such other address and to the attention of such other
person as the Acquiring Portfolio may designate by written notice to the
Acquired Portfolio. Any notice shall be deemed to have been served or
given as of the date such notice is delivered personally or mailed.
14. SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their successors and assigns. This Agreement shall not
be assigned by any party without the prior written consent of the other
party hereto.
15. BOOKS AND RECORDS.
The Acquired Portfolio and the Acquiring Portfolio agree that copies
of the books and records of the Acquired Portfolio relating to the Assets
including, but not limited to all files, records, written materials; e.g.,
closing transcripts, surveillance files and credit reports shall be
delivered by the Acquired Portfolio to the Acquiring Portfolio at the
Closing Date. In addition to, and without limiting the foregoing, the
Acquired Portfolio and the Acquiring Portfolio agree to take such action
as may be necessary in order that the Acquiring Portfolio shall have
reasonable access to such other books and records as may be reasonably
requested, all for three complete fiscal and tax years after the Closing
Date; namely, general ledger, journal entries, voucher registers;
distribution journal; payroll register, monthly balance owing report;
income tax returns; tax depreciation schedules; and investment tax credit
basis schedules.
16. GENERAL.
This Agreement supersedes all prior agreements between the parties
(written or oral), is intended as a complete and exclusive statement of
the terms of the Agreement between the parties and may not be amended,
modified or changed or terminated orally. This Agreement may be executed
in one or more counterparts, all of which shall be considered one and the
same agreement, and shall become effective when one or more counterparts
have been executed by the Acquired Portfolio and Acquiring Portfolio and
delivered to each of the parties hereto. The 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 is for
the sole benefit of the parties thereto, and nothing in this Agreement,
expressed or implied, is intended to confer upon any other person any
rights or remedies under or by reason of this Agreement. This Agreement
shall be governed by and construed in accordance with the laws of the
State of Illinois without regard to principles of conflicts or choice of
law.
17. LIMITATION OF LIABILITY.
Consistent with the Acquiring Portfolio's Declaration of Trust,
notice is hereby given and the parties hereto acknowledge and agree that
this instrument is executed by the Trustees of the Acquiring Portfolio on
behalf of the Acquiring Portfolio as Trustees and not individually and
that the obligations of this instrument are not binding upon any of the
Trustees or shareholders of the Acquiring Portfolio individually but
binding only upon the assets and property of the Acquired Portfolio or the
Acquiring Portfolio as the case may be.
IN WITNESS WHEREOF, the parties have hereunto caused this
Agreement to be executed and delivered by their duly authorized
officers as of the day and year first written above.
Xxx Xxxxxx Life Investment Trust on
behalf of the Asset Allocation
Portfolio
___________________________________
_
Name:
Title:
Xxx Xxxxxx Life Investment Trust on
behalf of the Enterprise Portfolio
___________________________________
_
Name:
Title:
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