AGREEMENT AND PLAN OF REORGANIZATION
State Farm Growth Fund, Inc.
State Farm Balanced Fund, Inc.
State Farm Interim Fund, Inc.
State Farm Municipal Bond Fund, Inc.
This Agreement and Plan of Reorganization (the "Plan") is dated as of March
16, 2001 by and among STATE FARM GROWTH FUND, INC. ("Growth Fund"), STATE FARM
BALANCED FUND, INC. ("Balanced Fund"), STATE FARM INTERIM FUND, INC. ("Interim
Fund"), STATE FARM MUNICIPAL BOND FUND, INC. ("Municipal Bond Fund") (each a
"Fund" and collectively, the "Funds"), each a Maryland corporation, and STATE
FARM ASSOCIATES' FUNDS TRUST, a Delaware business trust ("the Trust"), on behalf
of its series State Farm Growth Fund ("New Growth Fund"), State Farm Balanced
Fund ("New Balanced Fund"), State Farm Interim Fund ("New Interim Fund") and
State Farm Municipal Bond Fund ("New Municipal Bond Fund") (each, a "New Fund"
and collectively, the "New Funds"). Each of the parties hereto agree upon the
following plan of reorganization:
1. Succession of the Funds by the Trust; Distribution of Shares of the
New Funds. The succession of the Funds by the Trust and the distribution of
shares of beneficial interest of the New Funds shall occur in the following
manner:
1.1 Growth Fund shall transfer to New Growth Fund, as a series of the
Trust, all of its assets in exchange for which New Growth Fund shall
simultaneously assume all of the liabilities of Growth Fund, and New
Growth Fund shall issue to Growth Fund shares of beneficial interest
of New Growth Fund equal in number and net asset value to the number
and net asset value of shares (including fractional shares) of Growth
Fund then outstanding. Growth Fund shall promptly distribute to its
stockholders the number of shares of beneficial interest of New Growth
Fund (including fractional shares) equal in number and net asset value
to the number and net asset value of shares (including any fractional
shares) of Growth Fund then owned by the stockholder, in exchange for
and cancellation of the stockholder's shares of Growth Fund (which
series of actions is referred to hereafter as the "Growth Fund
Reorganization"). Growth Fund will then terminate its operations and
will subsequently be dissolved.
1.2 Balanced Fund shall transfer to New Balanced Fund, as a series of the
Trust, all of its assets in exchange for which New Balanced Fund shall
simultaneously assume all of the liabilities of Balanced Fund, and New
Balanced Fund shall issue to Balanced Fund shares of beneficial
interest of New Balanced Fund equal in number and net asset value to
the number and net asset value of shares (including fractional shares)
of Balanced Fund then outstanding. Balanced Fund shall promptly
distribute to its
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stockholders the number of shares of beneficial interest of New
Balanced Fund (including fractional shares) equal in number and net
asset value to the number and net asset value of shares (including any
fractional shares) of Balanced Fund then owned by the stockholder, in
exchange for and cancellation of the stockholder's shares of Balanced
Fund (which series of actions is referred to hereafter as the
"Balanced Fund Reorganization"). Balanced Fund will then terminate
its operations and will subsequently be dissolved.
1.3 Interim Fund shall transfer to New Interim Fund, as a series of the
Trust, all of its assets in exchange for which New Interim Fund shall
simultaneously assume all of the liabilities of Interim Fund, and New
Interim Fund shall issue to Interim Fund shares of beneficial interest
of New Interim Fund equal in number and net asset value to the number
and net asset value of shares (including fractional shares) of Interim
Fund then outstanding. Interim Fund shall promptly distribute to its
stockholders the number of shares of beneficial interest of New
Interim Fund (including fractional shares) equal in number and net
asset value to the number and net asset value of shares (including any
fractional shares) of Interim Fund then owned by the stockholder, in
exchange for and cancellation of the stockholder's shares of Interim
Fund (which series of actions is referred to hereafter as the "Interim
Fund Reorganization"). Interim Fund will then terminate its
operations and will subsequently be dissolved.
1.4 Municipal Bond Fund shall transfer to the New Municipal Bond Fund, as
a series of the Trust, all of its assets in exchange for which New
Municipal Bond Fund shall simultaneously assume all of the liabilities
of Municipal Bond Fund, and New Municipal Bond Fund shall issue to
Municipal Bond Fund shares of beneficial interest of New Municipal
Bond Fund equal in number and net asset value to the number and net
asset value of shares (including fractional shares) of Municipal Bond
Fund then outstanding. Municipal Bond Fund shall promptly distribute
to its stockholders the number of shares of beneficial interest of New
Municipal Bond Fund (including fractional shares) equal in number and
net asset value to the number and net asset value of shares (including
any fractional shares) of Municipal Bond Fund then owned by the
stockholder, in exchange for and cancellation of the stockholder's
shares of Municipal Bond Fund (which series of actions is referred to
hereafter as the "Municipal Bond Fund Reorganization", and together
with the Growth Fund Reorganization, Balanced Fund Reorganization and
Interim Fund Reorganization is referred to hereafter as the
"Reorganization"). Municipal Bond Fund will then terminate its
operations and will subsequently be dissolved.
2. Stockholder Accounts; Share Certificates. The distribution to the
stockholders of each of the Funds shall be accomplished by establishing an
account on the share records of each New Fund in the name of each registered
stockholder of the corresponding Fund, and crediting that account with a number
of shares of beneficial
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interest of the respective New Fund equal to the number of shares (including any
fractional shares) of the corresponding Fund owned of record by the stockholder
at the time of the distribution. Outstanding certificates representing shares
of each Fund shall thereafter represent an equal number of shares of beneficial
interest of the corresponding New Fund.
3. Dissolution of the Funds. As soon as reasonably practicable after
distribution of the shares of the New Funds pursuant to Section 1, but in all
events within six months after such distribution, the Funds shall be dissolved,
and any further actions shall be taken in connection therewith as required by
applicable law.
4. Closing. The Reorganization shall take place on March 29, 2001 at
4:00 p.m., Bloomington, Illinois time, at the offices of State Farm Investment
Management Corp., Xxx Xxxxx Xxxx Xxxxx, Xxxxxxxxxxx, Xxxxxxxx or at such other
date, time or place as may be agreed upon by the parties.
5. Conditions to Closing. The obligations of the parties to consummate
the Reorganization shall be subject to the following conditions:
a. An amendment to the notification of registration on Form N-8A of
Growth Fund shall have been filed by the Trust with the Securities and
Exchange Commission (the "SEC"), and the Trust shall have adopted as
its own the Growth Fund's notification of registration on Form N-8A as
amended;
b. An amendment to the registration statements on Form N-1A of the
Growth Fund shall have been filed by the Trust with the SEC and the
Trust shall have adopted the registration statements of each of the
Funds on such registration statement as amended as its own, and the
registration statement shall have become effective under the
Securities Act of 1933, and no stop-order suspending the effectiveness
of the registration statement shall have been issued and no proceeding
for that purpose shall have been initiated or threatened by the SEC
(other than such stop-order, proceeding or threatened proceeding
which shall have been withdrawn or terminated);
c. The SEC shall not have issued an unfavorable advisory report under
Section 25(b) of the Investment Company Act of 1940 nor instituted any
proceeding seeking to enjoin consummation of the Reorganization under
Section 25(c) of the Investment Company Act of 1940;
d. The Funds and the Trust shall have received an opinion of Xxxx, Xxxx &
Xxxxx, LLC, Chicago, Illinois, to the effect that the Reorganization
qualifies as a "reorganization" under Section 368 of the Internal
Revenue Code of 1986, as amended, and the Reorganization of the Funds
into the New Funds will not give rise to the recognition of income,
deductions, gain or loss for federal income tax purposes to the Funds,
the Trust, the New Funds, or the stockholders of the Funds;
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e. The Reorganization has been approved by the stockholders of each of
the Funds; and
f. The Funds and the Trust will execute and file articles of transfer
with respect to the transactions contemplated hereby with the
Department of Assessments and Taxation of the State of Maryland.
6. Representations. The Funds and/or the Trust represent as follows:
a. The Funds and the Trust are duly organized and existing in good
standing under the laws of the state of Maryland and the State of
Delaware, respectively;
b. The Funds and the Trust are each empowered under applicable laws to
enter into and perform this agreement; and
c. The New Funds intend (i) to continue the investment business of the
Funds, (ii) to maintain the investment objectives of the Funds as set
forth in each Fund's prospectus dated April 1, 2000, as may have been
amended and (iii) to market the New Funds to a group of investors that
includes the universe of investors to which the Funds are marketed.
The New Funds have no plan or intention to sell the investment assets
of the Funds except in the ordinary course of business to provide
funds to satisfy redemptions or as a result of portfolio management
decisions. The initial portfolio managers of the New Funds will be
the current portfolio managers of the Funds.
7. Amendments or Termination. This agreement may be amended at any time,
and may be terminated at any time before the closing of the Reorganization,
either before or after this Plan has been approved by stockholders of each of
the Funds, by agreement of the Funds and the Trust, provided that no amendment
shall have a material adverse effect upon the interests of stockholders of the
Funds. In any case, this Plan may be terminated by any of the Funds or the
Trust if the Reorganization has not occurred by the close of business on April
20, 2001.
8. Declaration of Trust. A copy of the Trust's certificate of trust is
on file with the Secretary of the State of Delaware, and notice is hereby given
that this agreement is executed on behalf of the trustees of the Trust as the
trustees of the Trust and not individually and that the obligations under this
instrument are not binding upon any of the trustees, officers or stockholders of
the Trust, individually, but binding only upon the assets and property of the
New Funds.
9. Further Actions and Assurances. At any time after the closing of the
Reorganization, the Funds acting through their officers, or if then dissolved
through their last officers, shall execute and deliver to the Trust such
additional instruments of transfer or other written assurances as the Trust may
reasonably request in order to vest in the Trust, acting on behalf of the New
Funds, title to the assets transferred by the Funds under this agreement.
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10. Governing Law. This agreement shall be construed in accordance with
applicable federal law and the laws of the State of Illinois, except as to the
provisions of Section 8 hereof which shall be construed in accordance with the
laws of the State of Delaware.
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Dated as of March 16, 2001
STATE FARM GROWTH FUND,
INC.,
By: /s/ Xxxxxx X. Xxxx, Xx.
Name: Xxxxxx X. Xxxx, Xx.
President
ATTEST:
/s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx, Secretary
STATE FARM BALANCED FUND,
INC.,
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Senior Vice President and
Treasurer
ATTEST:
/s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx, Secretary
STATE FARM INTERIM FUND,
INC.,
By: /s/ Xxxxxx X. Xxxx, Xx.
Name: Xxxxxx X. Xxxx, Xx.
President
ATTEST:
/s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx, Secretary
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STATE FARM MUNICIPAL BOND
FUND, INC.,
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Senior Vice President and
Treasurer
ATTEST:
/s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx, Secretary
STATE FARM ASSOCIATES' FUNDS
TRUST
on behalf of its series
State Farm Growth Fund,
State Farm Balanced Fund,
State Farm Interim Fund and
State Farm Municipal Bond
Fund
By: /s/ Xxxxxx X. Xxxx, Xx.
Name: Xxxxxx X. Xxxx, Xx.
President
ATTEST
/s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx, Secretary
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