AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF
REORGANIZATION ("Agreement") is made as of this 9th
day of August, 2010, by and among Xxxxx Xxxxx
Investment Trust, a Massachusetts business trust
("Investment Trust") on behalf of its series Xxxxx Xxxxx
California Limited Maturity Municipal Income Fund
("California Limited Fund") and Investment Trust, on
behalf of its series Xxxxx Xxxxx National Limited
Maturity Municipal Income Fund ("National Limited
Fund").
WITNESSETH
WHEREAS, Investment Trust is registered under
the Investment Company Act of 1940, as amended (the
"1940 Act") as an open-end management investment
company authorized to issue an unlimited number of
shares of beneficial interest without par value in one or
more series (such as California Limited Fund and
National Limited Fund), and the Trustees of Investment
Trust have divided the shares of California Limited Fund
and National Limited Fund into Class A, Class B and
Class C shares ("California Limited Fund Shares" and
"National Limited Fund Shares");
WHEREAS, Investment Trust desires to provide
for the reorganization of California Limited Fund through
the acquisition by National Limited Fund of substantially
all of the assets of California Limited Fund in exchange
for National Limited Fund Shares in the manner set forth
herein; and
WHEREAS, it is intended that the reorganization
described in this Agreement shall be a reorganization
within the meaning of Section 368 of the Internal
Revenue Code of 1986, as amended (the "Code");
NOW, THEREFORE, in consideration of the
mutual promises herein contained, the parties hereto
agree as follows:
1. Definitions
1.1 The term "1933 Act" shall mean the
Securities Act of 1933, as amended.
1.2 The term "1934 Act" shall mean the
Securities Exchange Act of 1934, as amended.
1.3 The term "Agreement" shall mean this
Agreement and Plan of Reorganization.
1.4 The term "Assumed Liabilities" shall
mean all liabilities, expenses, costs,
charges and receivables of California
Limited Fund as of the Close of Trading
on the New York Stock Exchange on the
Valuation Date. Included therein for the
National Limited Fund Class B and
Class C shall be the uncovered
distribution charges under the California
Limited Fund Class B and Class C
Distribution Plans, or, if lower, the
amount of contingent deferred sales
charges that would be paid by all
California Limited Class B and Class C
shareholders if they redeemed on the
Closing Date; such amount shall be
treated as uncovered distribution
charges under the National Limited Fund
Class B and Class C Distribution Plans.
1.5 The term "Business Day" shall mean any
day that the New York Stock Exchange
is open.
1.6 The term "Close of Trading on the
NYSE" shall mean the close of regular
trading on the New York Stock
Exchange, which is usually 4:00 p.m.
Eastern time.
1.7 The term "Closing" shall mean the
closing of the transaction contemplated
by this Agreement.
1.8 The term "Closing Date" shall mean
November 5, 2010, provided all
necessary approvals have been
received, or such other date as may be
agreed by the parties on which the
Closing is to take place.
1.9 The term "Commission" shall mean the
Securities and Exchange Commission.
1.10 The term "Custodian" shall mean State
Street Bank and Trust Company.
1.11 The term "Delivery Date" shall mean the
date contemplated by Section 3.3 of
this Agreement.
1.12 The term "Investment Trust N-14" shall
mean Investment Trust's registration
statement on Form N-14, including a
Proxy Statement/Prospectus as may be
amended, that describes the
transactions contemplated by this
Agreement and registers the National
Limited Fund Shares to be issued in
connection with this transaction.
1.13 The term "National Limited Fund
Investment Trust N-1A" shall mean the
registration statement, as amended, on
Form N-1A of Investment Trust with
respect to National Limited Fund in
effect on the date hereof or on the
Closing Date, as the context may
require.
1.14 The term "NYSE" shall mean the New
York Stock Exchange.
1.15 The term "California Limited Fund
Investment Trust N-1A" shall mean the
registration statement, as amended, on
Form N-1A of Investment Trust with respect to
California Limited Fund in effect on the
date hereof or on the Closing Date, as the
context may require.
1.16 The term "Proxy Statement" shall mean
the Proxy Statement/Prospectus
furnished to the California Limited Fund
shareholders in connection with this
transaction.
1.17 The term "Securities List" shall mean the
list of those securities and other assets
owned by Investment Trust, on behalf of
California Limited Fund, on the Delivery
Date.
1.18 The term "Valuation Date" shall mean the
day of the Closing Date.
2. Transfer and Exchange of Assets
2.1 Reorganization of California Limited
Fund. At the Closing, subject to the
requisite approval of the California
Limited Fund's shareholders and the
terms and conditions set forth herein,
Investment Trust shall transfer all of the
assets of California Limited Fund and
assign all Assumed Liabilities to
National Limited Fund, and National
Limited Fund shall acquire such assets
and shall assume such Assumed
Liabilities upon delivery by National
Limited Fund to California Limited Fund
on the Closing Date of Class A, Class B
and Class C National Limited Fund
Shares (including, if applicable,
fractional shares) having an aggregate
net asset value equal to the value of the
assets so transferred, assigned and
delivered, less the Assumed Liabilities,
all determined and adjusted as provided
in Section 2.2. Upon delivery of the
assets, National Limited Fund will
receive good and marketable title
thereto free and clear of all liens.
2.2 Computation of Net Asset Value. The
net asset value per share of the National
Limited Fund Shares and the net value
of the assets of California Limited Fund
subject to this Agreement shall, in each
case, be determined as of the Close of
Trading on the NYSE on the Valuation
Date, after the declaration and payment
of any dividend on that date. The net
asset value of the National Limited Fund
Shares shall be computed in the manner
set forth in the National Limited Fund
Investment Trust Form N-1A. In
determining the value of the securities
transferred by California Limited Fund to
National Limited Fund, such assets shall
be priced in accordance with the
policies and procedures described in
the National Limited Fund Investment
Trust N-1A.
3. Closing Date, Valuation Date and Delivery
3.1 Closing Date. The Closing shall be at
the offices of Xxxxx Xxxxx
Management, Xxx Xxxxxxxxxxxxx Xxxxx,
Xxxxxx, XX 00000 immediately after the
close of business on the Closing Date.
All acts taking place at Closing shall be
deemed to take place simultaneously as
of the close of business on the Closing
Date unless otherwise agreed in writing
by the parties.
3.2 Valuation Date. Pursuant to Section
2.2, the net value of the assets of
California Limited Fund and the net
asset value per share of National
Limited Fund shall be determined as of
the Close of Trading on the NYSE on
the Valuation Date, after the declaration
and payment of any dividend on that
date. The stock transfer books of
Investment Trust with respect to
California Limited Fund will be
permanently closed, and sales of
California Limited Fund Shares shall be
suspended, as of the close of business
of Investment Trust on the Valuation
Date. Redemption requests thereafter
received by Investment Trust with
respect to California Limited Fund shall
be deemed to be redemption requests
for National Limited Fund Shares to be
distributed to shareholders of California
Limited Fund under this Agreement
provided that the transactions
contemplated by this Agreement are
consummated.
In the event that trading on the NYSE or
on another exchange or market on which
securities held by the California Limited
Fund are traded shall be disrupted on
the Valuation Date so that, in the
judgment of Investment Trust, accurate
appraisal of the net assets of California
Limited Fund to be transferred
hereunder or the assets of National
Limited Fund is impracticable, the
Valuation Date shall be postponed until
the first Business Day after the day on
which trading on such exchange or in
such market shall, in the judgment of
Investment Trust, have been resumed
without disruption. In such event, the
Closing Date shall be postponed until
one Business Day after the Valuation
Date.
3.3 Delivery of Assets. After the close of
business on the Valuation Date,
Investment Trust shall issue instructions
providing for the delivery of all of its
assets held on behalf of California
Limited Fund to the Custodian to be
held for the account of National Limited
Fund, effective as of the Closing.
National Limited Fund may inspect such
securities at the offices of the
Custodian prior to the Valuation Date.
4. California Limited Fund Distributions and
Termination
4.1 As soon as reasonably practicable after
the Closing Date, Investment Trust shall
pay or make provisions for the payment
of all of the debts and taxes of
California Limited Fund and distribute all
remaining assets, if any, to shareholders
of California Limited Fund, and
California Limited Fund shall thereafter
be terminated under Massachusetts law.
At, or as soon as may be practicable
following the Closing Date, Investment
Trust on behalf of California Limited
Fund shall distribute the Class A, Class
B and Class C National Limited Fund
Shares it received from the National
Limited Fund to the shareholders of the
California Limited Fund and shall
instruct National Limited Fund as to the
amount of the pro rata interest of each
of California Limited Fund's
shareholders as of the close of
business on the Valuation Date (such
shareholders to be certified as such by
the transfer agent for Investment Trust),
to be registered on the books of
National Limited Fund, in full and
fractional National Limited Fund Shares,
in the name of each such shareholder,
and National Limited Fund agrees
promptly to transfer the National Limited
Fund Shares then credited to the
account of California Limited Fund on
the books of National Limited Fund to
open accounts on the share records of
National Limited Fund in the names of
California Limited Fund shareholders in
accordance with said instruction. Each
California Limited Fund shareholder
shall receive shares of the
corresponding class of National Limited
Fund to the class of California Limited
Fund held by such shareholder. All
issued and outstanding California
Limited Fund Shares shall thereupon be
canceled on the books of Investment
Trust. National Limited Fund shall have
no obligation to inquire as to the
correctness of any such instruction, but
shall, in each case, assume that such
instruction is valid, proper and correct.
5. California Limited Fund Securities
On the Delivery Date, Investment Trust on behalf
of California Limited Fund shall deliver the
Securities List and tax records. Such records
shall be made available to National Limited Fund
prior to the Closing Date for inspection by the
Treasurer (or his or her designee).
Notwithstanding the foregoing, it is expressly
understood that California Limited Fund may
hereafter until the close of business on the
Valuation Date sell any securities owned by it in
the ordinary course of its business as a series
of an open-end, management investment
company.
6. Liabilities and Expenses
National Limited Fund shall acquire all liabilities
of California Limited Fund, whether known or
unknown, or contingent or determined.
Investment Trust will discharge all known
liabilities of California Limited Fund, so far as
may be possible, prior to the Closing Date.
California Limited Fund shall bear the expenses
of carrying out this Agreement.
7. Investment Trust Representations and
Warranties
Investment Trust, on behalf of California Limited
and National Limited Funds, hereby represents,
warrants and agrees as follows:
7.1 Legal Existence. Investment Trust is a
business trust duly organized and
validly existing under the laws of the
Commonwealth of Massachusetts.
Each of California Limited Fund and
National Limited Fund is a validly
existing series of Investment Trust.
Investment Trust is authorized to issue
an unlimited number of shares of
beneficial interest of National Limited
Fund.
7.2 Registration under 1940 Act. Investment
Trust is duly registered as an open-end
management investment company under
the 1940 Act and such registration is in
full force and effect.
7.3 Financial Statements. The statement of
assets and liabilities and the schedule
of portfolio investments and the related
statements of operations and changes
in net assets of California Limited Fund
dated March 31, 2010 and National
Limited Fund dated March 31, 2010,
fairly present the financial condition of
California Limited Fund and National
Limited Fund as of said dates in
conformity with generally accepted
accounting principles.
7.4 No Contingent Liabilities. There are no
known contingent liabilities of California
Limited Fund or National Limited Fund
not disclosed and there are no legal,
administrative or other proceedings
pending, or to the knowledge of
Investment Trust threatened, against
California Limited Fund or National
Limited Fund which would materially
affect its financial condition.
7.5 Requisite Approvals. The execution and
delivery of this Agreement and the
consummation of the transactions
contemplated herein, have been
authorized by the Board of Trustees of
Investment Trust by vote taken at a
meeting of such Board duly called and
held on August 9, 2010. No approval of
the shareholders of National Limited
Fund is required in connection with this
Agreement or the transaction
contemplated hereby. The Agreement
has been executed and delivered by a
duly authorized officer of Investment
Trust and is a valid and legally binding
obligation of each of California Limited
Fund and National Limited Fund
enforceable in accordance with its
terms.
7.6 No Material Violations. Investment Trust
is not, and the execution, delivery and
performance of this Agreement will not
result, in a material violation of any
provision of its Declaration of Trust or
By-Laws, as each may be amended, of
Investment Trust or of any agreement,
indenture, instrument, contract, lease or
other undertaking to which Investment
Trust is a party or by which it is bound.
7.7 Taxes and Related Filings. Except
where failure to do so would not have a
material adverse effect on California
Limited Fund or National Limited Fund,
each of California Limited Fund and
National Limited Fund has filed or will
file or obtain valid extensions of filing
dates for all required federal, state and
local tax returns and reports for all
taxable years through and including its
current taxable year and no such filings
are currently being audited or contested
by the Internal Revenue Service or state
or local taxing authority and all federal,
state and local income, franchise,
property, sales, employment or other
taxes or penalties payable pursuant to
such returns have been paid or will be
paid, so far as due. Each of California
Limited Fund and National Limited Fund
has elected to be treated as a "regulated
investment company" for federal tax
purposes, has qualified as such for
each taxable year of its operations and
will qualify as such as of the Closing
Date.
7.8 Good and Marketable Title. On the
Closing Date, California Limited Fund
will have good and marketable title to its
assets, free and clear of all liens,
mortgages, pledges, encumbrances,
charges, claims and equities
whatsoever, and full right, power and
authority to sell, assign, transfer and
deliver such assets and shall deliver
such assets to National Limited Fund.
Upon delivery of such assets, National
Limited Fund will receive good and
marketable title to such assets, free and
clear of all liens, mortgages, pledges,
encumbrances, charges, claims and
equities, except as to adverse claims
under Article 8 of the Uniform
Commercial Code of which National
Limited Fund has notice and necessary
documentation at or prior to the time of
delivery.
7.9 National Limited Fund Investment Trust
N-1A Not Misleading. The National
Limited Fund Investment Trust N-1A
conforms on the date of the Agreement,
and will conform on the date of the
Proxy Statement and the Closing Date,
in all material respects to the applicable
requirements of the 1933 Act and the
1940 Act and the rules and regulations
of the Commission thereunder and does
not include any untrue statement of a
material fact or omit to state any
material fact required to be stated
therein or necessary to make the
statements therein, in light of the
circumstances under which they were
made, not materially misleading.
7.10 Proxy Statement. The Proxy Statement
delivered to the California Limited Fund
shareholders in connection with this
transaction (both at the time of delivery
to such shareholders in connection with
the meeting of shareholders and at all
times subsequent thereto and including
the Closing Date) in all material
respects, conforms to the applicable
requirements of the 1934 Act and the
1940 Act and the rules and regulations
of the Commission thereunder, and will
not include any untrue statement of a
material fact or omit to state any
material fact required to be stated
thereon or necessary to make
statements therein, in light of the
circumstances under which they were
made, not materially misleading.
7.11 Books and Records. Each of California
Limited Fund and National Limited Fund
have maintained all records required
under Section 31 of the 1940 Act and
rules thereunder.
8. Conditions Precedent to Closing
The obligations of the parties hereto shall be
conditioned on the following:
8.1 Representations and Warranties. The
representations and warranties of the
parties made herein will be true and
correct as of the date of this Agreement
and on the Closing Date.
8.2 Shareholder Approval. The Agreement
and the transactions contemplated
herein shall have been approved by the
requisite vote of the holders of
California Limited Fund Shares in
accordance with the 1940 Act and the
Declaration of Trust and By-Laws, each
as amended, of Investment Trust.
8.3 Pending or Threatened Proceedings.
On the Closing Date, no action, suit or
other proceeding shall be threatened or
pending before any court or
governmental agency in which it is
sought to restrain or prohibit, or obtain
damages or other relief in connection
with, this Agreement or the transactions
contemplated herein.
8.4 Registration Statement. The Investment
Trust N-14 shall have become effective
under the 1933 Act; no stop orders
suspending the effectiveness of such
Investment Trust N-14 shall have been
issued; and, to the best knowledge of
the parties hereto, no investigation or
proceeding for that purpose shall have
been instituted or be pending,
threatened or contemplated under the
1933 Act. The Proxy Statement has
been delivered to each shareholder of
record of the California Limited Fund as
of August 19, 2010 in accordance with
the provisions of the 1934 Act and the
rules thereunder.
8.5 Declaration of Dividend. Investment
Trust shall have declared a dividend or
dividends which, together with all
previous such dividends, shall have the
effect of distributing to California
Limited Fund shareholders all of
California Limited Fund's investment
company taxable income (as defined in
Section 852 of the Code) (computed
without regard to any deduction for
dividends paid) for the final taxable
period of California Limited Fund, all of
its net capital gain realized in the final
taxable period of California Limited
Fund (after reduction for any capital
loss carryforward) and all of the excess
of (i) its interest income excludable from
gross income under Section 103(a) of
the Code over (ii) its deductions
disallowed under Sections 265 and
171(a)(2) of the Code for the final
taxable period of California Limited
Fund.
8.6 State Securities Laws. The parties shall
have received all permits and other
authorizations necessary, if any, under
state securities laws to consummate the
transactions contemplated herein.
8.7 Performance of Covenants. Each party
shall have performed and complied in
all material respects with each of the
agreements and covenants required by
this Agreement to be performed or
complied with by each such party prior
to or at the Valuation Date and the
Closing Date.
8.8 Due Diligence. National Limited Fund
shall have had reasonable opportunity
to have its officers and agents review
the records of California Limited Fund.
8.9 No Material Adverse Change. From the
date of this Agreement, 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 California Limited
Fund or National Limited Fund
(other than changes in the
ordinary course of its business,
including, without limitation,
dividends and distributions in
the ordinary course and
changes in the net asset value
per share) which has had a
material adverse effect on such
business, results of operations,
assets or financial condition,
except in all instances as set
forth in the financial statements;
* any loss (whether or not
covered by insurance) suffered
by California Limited Fund or
National Limited Fund materially
and adversely affecting of
California Limited Fund or
National Limited Fund, other
than depreciation of securities;
* issued by Investment Trust to any
person any option to purchase
or other right to acquire shares
of any class of California
Limited Fund or National Limited
Fund Shares (other than in the
ordinary course of Investment
Trust's business as an open-end
management investment
company);
* any indebtedness incurred by
California Limited Fund or
National Limited Fund for
borrowed money or any
commitment to borrow money
entered into by California
Limited Fund or National Limited
Fund except as permitted in
California Limited Fund
Investment Trust N-1A or
National Limited Fund
Investment Trust N-1A and
disclosed in financial
statements required to be
provided under this Agreement;
* any amendment to the
Declaration of Trust or By-Laws
of Investment Trust that will
adversely affect the ability of
Investment Trust to comply with
the terms of this Agreement; or
* any grant or imposition of any
lien, claim, charge or
encumbrance upon any asset of
California Limited Fund except
as provided in California Limited
Fund Investment Trust N-1A so
long as it will not prevent
Investment Trust from
complying with Section 7.8.
8.10 Lawful Sale of Shares. On the Closing
Date, National Limited Fund Shares to
be issued pursuant to Section 2.1 of
this Agreement will be duly authorized,
duly and validly issued and outstanding,
and fully paid and non-assessable by
Investment Trust, and conform in all
substantial respects to the description
thereof contained in the Investment
Trust N-14 and Proxy Statement
furnished to the California Limited Fund
shareholders and the National Limited
Fund Shares to be issued pursuant to
paragraph 2.1 of this Agreement will be
duly registered under the 1933 Act by
the Investment Trust N-14 and will be
offered and sold in compliance with all
applicable state securities laws.
8.11 Documentation and Other Actions.
Investment Trust shall have executed
such documents and shall have taken
such other actions, if any, as reasonably
requested to fully effectuate the
transactions contemplated hereby.
9. Addresses
All notices required or permitted to be given
under this Agreement shall be given in writing to
Xxxxx Xxxxx Investment Trust, Xxx Xxxxxxxxxxxxx
Xxxxx, Xxxxxx, XX 00000 (Attention: Chief
Legal Officer), or at such other place as shall be
specified in written notice given by either party
to the other party to this Agreement and shall be
validly given if mailed by first-class mail,
postage prepaid.
10. Termination
This Agreement may be terminated by either
party upon the giving of written notice to the
other, if any of the representations, warranties or
conditions specified in Sections 7 or 8 hereof
have not been performed or do not exist on or
before December 31, 2010. In the event of
termination of this Agreement pursuant to this
provision, neither party (nor its officers,
Trustees or shareholders) shall have any liability
to the other.
11. Miscellaneous
This Agreement shall be governed by, construed
and enforced in accordance with the laws of the
Commonwealth of Massachusetts. Investment
Trust represents that there are no brokers or
finders entitled to receive any payments in
connection with the transactions provided for
herein. Investment Trust represents that this
Agreement constitutes the entire agreement
between the parties as to the subject matter
hereof. The representations, warranties and
covenants contained in this Agreement or in any
document delivered pursuant hereto or in
connection herewith shall not survive the
consummation of the transactions contemplated
hereunder. The Section headings contained in
this Agreement are for reference purposes only
and shall not affect in any way the meaning or
interpretation of this Agreement. This
Agreement shall be executed in any number of
counterparts, each of which shall be deemed an
original. Whenever used herein, the use of any
gender shall include all genders. In the event
that any provision of this Agreement is
unenforceable at law or in equity, the remainder
of the Agreement shall remain in full force and
effect.
12. Amendments
At any time prior to or after approval of this
Agreement by California Limited Fund
shareholders (i) the parties hereto may, by
written agreement and without shareholder
approval, amend any of the provisions of this
Agreement, and (ii) either party may waive
without such approval any default by the other
party or the failure to satisfy any of the
conditions to its obligations (such waiver to be
in writing); provided, however, that following
shareholder approval, no such amendment may
have the effect of changing the provisions for
determining the number of National Limited
Fund Shares to be received by California
Limited Fund shareholders under this Agreement
to the detriment of such shareholders without
their further approval. The failure of a party
hereto to enforce at any time any of the
provisions of this Agreement shall in no way be
construed to be a waiver of any such provision,
nor in any way to affect the validity of this
Agreement or any part hereof or the right of any
party thereafter to enforce each and every such
provision. No waiver of any breach of this
Agreement shall be held to be a waiver of any
other or subsequent breach.
13. Massachusetts Business Trust
References in this Agreement to Investment
Trust mean and refer to the Trustees from time
to time serving under its Declarations of Trust
on file with the Secretary of the Commonwealth
of Massachusetts, as the same may be
amended from time to time, pursuant to which
they conduct their businesses. It is expressly
agreed that the obligations of Investment Trust
hereunder shall not be binding upon any of the
trustees, shareholders, nominees, officers,
agents or employees of the Trust personally, but
bind only the trust property of the Trust as
provided in said Declaration of Trust. The
execution and delivery of this Agreement has
been authorized by the respective trustees and
signed by an authorized officer of Investment
Trust, acting as such, and neither such
authorization by such trustees nor such
execution and delivery by such officer shall be
deemed to have been made by any of them but
shall bind only the trust property of the Trust as
provided in such Declaration of Trust. No series
of Investment Trust shall be liable for the
obligations of any other series.
IN WITNESS WHEREOF, each of the parties
hereto has caused this Agreement to be executed by
their officers thereunto duly authorized, as of the day
and year first above written.
ATTEST: XXXXX
XXXXX INVESTMENT TRUST
(on
behalf of Xxxxx Xxxxx California Limited Municipal
Income
Fund)
/s/ Xxxxxxx X. Gemma By:
/s/ Xxxxxxx X. Clemson
Xxxxxxx X. Gemma, Secretary
Xxxxxxx X. Clemson, President
XXXXX
XXXXX INVESTMENT TRUST
(on
behalf of Xxxxx Xxxxx National Limited Maturity
Municipal Income Fund)
/s/ Xxxxxxx X. Gemma By:
/s/ Xxxxxxx X. Clemson
Xxxxxxx X. Gemma, Secretary
Xxxxxxx X. Clemson, President
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