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 Domestic Income Portfolio (the
"Acquired Portfolio") and Xxx Xxxxxx Life Investment Trust, on behalf
of its series, the Government 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;
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.
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. 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. 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 the
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.
G. 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.
A. 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:
B. 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.
C. 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.
D. REGISTRATION STATEMENT EFFECTIVE. The Registration
Statement shall have become effective and no stop orders under the
Securities Act pertaining thereto shall have been issued.
E. REGULATORY APPROVAL. All necessary approvals,
registrations, and exemptions under federal and state securities laws
shall have been obtained.
F. 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.
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.
A. 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.
A. 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 Domestic Income
Portfolio
Name:
Title:
Xxx Xxxxxx Life Investment Trust on
behalf of the Government Portfolio
Name:
Title:
22
318283.01-Chicago Server 2A MSW - Draft April 22, 2002 - 3:34 PM
318283.01-Chicago Server 2A MSW - Draft April 22, 2002 - 3:34 PM
