Item 77Q1(g)(2)
MUNDER SERIES TRUST
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION ("Agreement") is made as of this
9th day of November, 2004, by Munder Series Trust, a Delaware statutory trust
("Trust"), with its principal place of business at 000 Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, on behalf of the Munder Micro-Cap Equity Fund
("Acquiring Fund"), a separate series of the Trust, and the Munder Small
Company Growth Fund ("Acquired Fund"), also a separate series of the Trust.
This Agreement is intended to be and is adopted as a plan of reorganization
and liquidation within the meaning of Section 368(a)(1) of the United States
Internal Revenue Code of 1986, as amended ("Code"). The reorganization and
liquidation will consist of (1) the sale, assignment, conveyance, transfer and
delivery of all of the property and assets of the Acquired Fund to the Acquiring
Fund in exchange solely for shares of beneficial interest of Class A, Class B,
Class C, Class K and Class Y shares of the Acquiring Fund
("Acquiring Fund Shares") corresponding to the classes of outstanding shares of
beneficial interest of the Acquired Fund ("Acquired Fund Shares"), as described
herein, (2) the assumption by the Acquiring Fund of all liabilities of the
Acquired Fund, and (3) the distribution of the Acquiring Fund Shares to the
shareholders of the Acquired Fund in complete liquidation of the Acquired Fund,
as provided herein ("Reorganization"), all upon the terms and conditions
hereinafter set forth in this Agreement.
WHEREAS, the Acquired Fund and the Acquiring Fund are each a series of the
Trust, a registered investment company classified as a management company of the
open-end type, and the Acquired Fund owns securities that generally are assets
of the character in which the Acquiring Fund is permitted to invest;
WHEREAS, the Trustees of the Trust have determined, with respect to the
Acquiring Fund, that the sale, assignment, conveyance, transfer and delivery of
all of the property and assets of the Acquired Fund for Acquiring Fund Shares
and the assumption of all liabilities of the Acquired Fund by the Acquiring Fund
is in the best interests of the Acquiring Fund and that the interests of the
existing shareholders of the Acquiring Fund would not be diluted as a result of
this transaction; and
WHEREAS, the Trustees of the Trust also have determined, with respect to the
Acquired Fund, that the sale, assignment, conveyance, transfer and delivery of
all of the property and assets of the Acquired Fund for Acquiring Fund Shares
and the assumption of all liabilities of the Acquired Fund by the Acquiring Fund
is in the best interests of the Acquired Fund and that the interests of the
existing shareholders of the Acquired Fund would not be diluted as a result of
this transaction;
NOW, THEREFORE, in consideration of the premises and of the covenants and
agreements hereinafter set forth, the parties hereto covenant and agree as
follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND TO THE ACQUIRING FUND IN EXCHANGE
FOR ACQUIRING FUND SHARES, THE ASSUMPTION OF ALL ACQUIRED FUND LIABILITIES
AND THE LIQUIDATION OF THE ACQUIRED FUND
1.1. Subject to the requisite approval of the Acquired Fund shareholders
and the other terms and conditions herein set forth and on the basis
of the representations and warranties contained herein, the
Acquired Fund agrees to sell, assign, convey, transfer and deliver
all of the property and assets of the Acquired Fund, as set forth
in paragraph 1.2, to the Acquiring Fund, and the Acquiring Fund
agrees in exchange therefor: (i) to deliver to the Acquired Fund the
number of full and fractional Class A, Class B, Class C, Class K and
Class Y Acquiring Fund Shares determined by dividing the value of
the Acquired Fund's net assets with respect to each corresponding
class of Acquired Fund Shares, computed in the manner and as of the
time and date set forth in paragraph 2.1, by the net asset value of
one Acquiring Fund Share of the corresponding class, computed in the
manner and as of the time and date set forth in paragraph 2.2; and
(ii) to assume all liabilities of the Acquired Fund, as set forth in
paragraph 1.3. Such transactions shall take place on the date of
the closing provided for in paragraph 3.1 ("Closing Date").
1.2. The property and assets of the Trust attributable to the Acquired
Fund to be acquired by the Acquiring Fund shall consist of all
property and assets, including, without limitation, all rights,
cash, securities, commodities and futures interests and dividends or
interests receivable that are owned by the Acquired Fund and any
deferred or prepaid expenses shown as an asset on the books of the
Acquired Fund on the Valuation Date as defined in paragraph 2.1
(collectively, "Assets"). The Acquired Fund will sell, assign,
convey, transfer and deliver to the Acquiring Fund any rights, stock
dividends, or other securities received by the Acquired Fund after
the Closing Date as stock dividends or other distributions on or
with respect to the property and assets transferred, which rights,
stock dividends, and other securities shall be deemed included in
the property and assets transferred to the Acquiring Fund at the
Closing Date and shall not be separately valued, in which case any
such distribution that remains unpaid as of the Closing Date shall
be included in the determination of the value of the assets of the
Acquired Fund acquired by the Acquiring Fund.
1.3. The Acquired Fund will make reasonable efforts to discharge all of
its known liabilities and obligations prior to the Valuation Date.
The Acquiring Fund shall assume all of the liabilities of the
Acquired Fund, whether accrued or contingent, known or unknown,
existing at the Valuation Date (collectively, "Liabilities"). On or
as soon as practicable prior to the Closing Date, the Acquired Fund
will declare and pay to its shareholders of record one or more
dividends and/or other distributions so that it will have
distributed substantially all (and in no event less than 98%) of its
investment company taxable income (computed without regard to any
deduction for dividends paid) and realized net capital gain (after
reduction for any available capital loss carryover), if any, for the
current taxable year through the Closing Date.
1.4. Immediately following the actions contemplated by paragraph 1.1, the
Trust shall take such actions necessary to complete the liquidation
of the Acquired Fund. To complete the liquidation, the Trust, on
behalf of the Acquired Fund, shall (a) distribute to the Acquired
Fund's shareholders of record with respect to each class of its
shares as of the Closing as defined in paragraph 3.1 ("Acquired Fund
Shareholders"), on a pro rata basis within that class, the Acquiring
Fund Shares of the corresponding class received by the Acquired Fund
pursuant to paragraph 1.1 and (b) completely liquidate. Such
distribution and liquidation will be accomplished, with respect to
each class of the Acquired Fund's shares, by the transfer of the
Acquiring Fund Shares then credited to the account of the Acquired
Fund on the books of the Acquiring Fund to open accounts on the
share records of the Acquiring Fund in the names of the Acquired
Fund Shareholders. The aggregate net asset value of Class A,
Class B, Class C, Class K and Class Y Acquiring Fund Shares to be so
credited to Class A, Class B, Class C, Class K and Class Y Acquired
Fund Shareholders, respectively, shall, with respect to each class,
be equal to the aggregate net asset value of the Acquired Fund
Shares of the corresponding class owned by Acquired Fund
Shareholders on the Closing Date. All issued and outstanding
Acquired Fund Shares will simultaneously be canceled on the books of
the Acquired Fund. The Acquiring Fund shall not issue certificates
representing the Class A, Class B, Class C, Class K and Class Y
Acquiring Fund Shares in connection with the Reorganization.
1.5. Ownership of Acquiring Fund Shares will be shown on the books of the
Acquiring Fund's Transfer Agent, as defined in paragraph 3.3.
1.6. Any reporting responsibility of the Acquired Fund, including, but
not limited to, the responsibility for filing regulatory reports,
tax returns, or other documents with the Securities and Exchange
Commission ("Commission"), any state securities commission, and any
Federal, state or local tax authorities or any other relevant
regulatory authority, is and shall remain the responsibility of the
Acquired Fund.
2. VALUATION
2.1. The value of the Assets shall be the value of such Assets as of the
close of business of the New York Stock Exchange and after the
declaration of any dividends on the Closing Date (such time and
date being hereinafter called the "Valuation Date"), computed using
the valuation procedures set forth in the then-current prospectus
and statement of additional information with respect to the
Acquired Fund and valuation procedures established by the Trust's
Board of Trustees.
2.2. The net asset value of each Class A, Class B, Class C, Class K and
Class Y Acquiring Fund Share shall be the net asset value per share
computed with respect to that class as of the Valuation Date, using
the valuation procedures set forth in the Acquiring Fund's
then-current prospectus and statement of additional information,
and valuation procedures established by the Trust's Board of
Trustees.
2.3. The number of the Class A, Class B, Class C, Class K and Class Y
Acquiring Fund Shares to be issued (including fractional shares,
if any) in exchange for the Acquired Fund's Assets shall be
determined with respect to each such class by dividing the value
of the net assets with respect to the Class A, Class B, Class C,
Class K and Class Y Acquired Fund Shares, as the case may be,
determined using the same valuation procedures referred to in
paragraph 2.1, by the net asset value of a corresponding Acquiring
Fund Share, determined in accordance with paragraph 2.2.
2.4. All computations of value shall be made by State Street Bank and
Trust Company, in its capacity as sub-administrator for the Trust,
and shall be subject to confirmation by the Trust's administrator.
3. CLOSING AND CLOSING DATE
3.1. The Closing Date shall be February 25, 2005, or such other date as
the parties may agree. All acts taking place at the closing of
the transactions provided for in this Agreement ("Closing") shall
be deemed to take place simultaneously as of the close of business
on the Closing Date unless otherwise agreed to by the parties.
The close of business on the Closing Date shall be as of 4:00 p.m.,
Eastern Time. The Closing shall be held at the offices of the
Trust.
3.2. The Trust shall direct State Street Bank and Trust Company, as
custodian for the Acquired Fund ("Custodian"), to deliver to the
Trust at the Closing a certificate of an authorized officer of the
Custodian stating that (i) the Assets of the Acquired Fund have
been delivered in proper form to the Acquiring Fund within two
business days prior to or on the Closing Date, and (ii) all
necessary taxes in connection with the delivery of the Assets,
including all applicable Federal and state stock transfer stamps,
if any, have been paid or provision for payment has been made.
The Acquired Fund's portfolio securities represented by a
certificate or other written instrument shall be presented by the
Custodian to those persons at the Custodian who have primary
responsibility for the safekeeping of the assets of the Acquiring
Fund, as the Custodian also serves as the custodian for the
Acquiring Fund. Such presentation shall be made for examination
no later than five business days preceding the Closing Date, and
such certificates and other written instruments shall be
transferred and delivered by the Acquired Fund as of the Closing
Date for the account of the Acquiring Fund duly endorsed in proper
form for transfer in such condition as to constitute good delivery
thereof. The Custodian shall deliver to those persons at the
Custodian who have primary responsibility for the safekeeping of
the assets of the Acquiring Fund as of the Closing Date by book
entry, in accordance with the customary practices of the Custodian
and of each securities depository, as defined in Rule 17f-4 under
the Investment Company Act of 1940, as amended ("1940 Act"), in
which the Acquired Fund's Assets are deposited, the Acquired
Fund's Assets deposited with such depositories. The cash to be
transferred by the Acquired Fund shall be delivered by wire
transfer of Federal funds on the Closing Date.
3.3. The Trust shall direct PFPC, Inc., in its capacity as transfer
agent for the Trust ("Transfer Agent"), to deliver to the Trust at
the Closing a certificate of an authorized officer of the Transfer
Agent stating that its records contain the names and addresses of
the Acquired Fund Shareholders and the number and percentage
ownership of outstanding Class A, Class B, Class C, Class K and
Class Y shares owned by each such shareholder immediately prior to
the Closing. The Secretary of the Trust shall confirm that
(a) the appropriate number of Acquiring Fund Shares have been
credited to the Acquired Fund's account on the books of the
Acquiring Fund pursuant to paragraph 1.1 prior to the actions
contemplated by paragraph 1.4 and (b) the appropriate number of
Acquiring Fund Shares have been credited to the accounts of the
Acquired Fund Shareholders on the books of the Acquiring Fund
pursuant to paragraph 1.4. At the Closing the Trust shall execute
such bills of sale, checks, assignments, share certificates,
if any, receipts or other documents as necessary to effect
the Reorganization.
3.4. In the event that on the Valuation Date (a) the New York Stock
Exchange or another primary trading market for portfolio
securities of the Acquiring Fund or the Acquired Fund
(each, an "Exchange") shall be closed to trading or trading
thereupon shall be restricted, or (b) trading or the reporting of
trading on such Exchange or elsewhere shall be disrupted so that,
in the judgment of the Board of Trustees of the Trust, accurate
appraisal of the value of the net assets of the Acquiring Fund or
the Acquired Fund is impracticable, the Closing Date shall be
postponed until the first business day after the day when trading
shall have been fully resumed and reporting shall have been
restored.
4. REPRESENTATIONS AND WARRANTIES
4.1. Except as has been fully disclosed to the Acquiring Fund prior to
the date of this Agreement in a written instrument executed by an
officer of the Trust, the Trust, on behalf of the Acquired Fund,
represents and warrants to the Acquiring Fund as follows:
(a) The Acquired Fund is duly organized as a series of the Trust,
which is a statutory trust duly organized, validly existing
and in good standing under the laws of the State of Delaware,
with power under the Trust's Declaration of Trust, as amended
from time to time ("Declaration"), to own all of its Assets
and to carry on its business as it is now being conducted;
(b) The Trust is a registered investment company classified as a
management company of the open-end type, and its registration
with the Commission as an investment company under the 1940
Act, and the registration of the Class A, Class B, Class C,
Class K and Class Y Acquired Fund Shares under the Securities
Act of 1933, as amended ("1933 Act"), is in full force and
effect;
(c) No consent, approval, authorization, or order of any court or
governmental authority is required for the consummation by the
Acquired Fund of the transactions contemplated herein, except
such as may be required under the 1933 Act, the Securities
Exchange Act of 1934, as amended ("1934 Act"), the 1940 Act
and state securities laws;
(d) The current prospectus and statement of additional information
of the Acquired Fund and each prospectus and statement of
additional information of the Acquired Fund used at all times
prior to the date of this Agreement conforms or conformed at the
time of its use 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 or did not
at the time of its use 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;
(e) On the Valuation Date, the Trust, on behalf of the Acquired
Fund, will have good and marketable title to the Assets of
the Acquired Fund and full right, power, and authority to sell,
assign, transfer and deliver such Assets hereunder free of any
liens or other encumbrances, and upon delivery and payment for
such Assets, the Trust, on behalf of the Acquiring Fund, will
acquire good and marketable title thereto, subject to no
restrictions on the full transfer thereof, including such
restrictions as might arise under the 1933 Act;
(f) The Acquired Fund is not engaged currently, and the execution,
delivery and performance of this Agreement will not result, in
(i) a material violation of the Trust's Declaration or By-Laws
or of any agreement, indenture, instrument, contract, lease or
other undertaking to which the Trust, on behalf of the Acquired
Fund, is a party or by which it is bound, or (ii) the
acceleration of any material obligation, or the imposition of any
material penalty, under any agreement, indenture, instrument,
contract, lease, judgment or decree to which the Trust, on behalf
of the Acquired Fund, is a party or by which it is bound;
(g) All material contracts or other commitments of the Acquired Fund
(other than this Agreement and certain investment contracts
including options, futures, and forward contracts) will terminate
without liability to the Acquired Fund on or prior to the Closing
Date;
(h) No litigation or administrative proceeding or investigation of or
before any court or governmental body is presently pending or, to
the Trust's knowledge, threatened against the Trust, with respect
to the Acquired Fund or any of its properties or assets, that, if
adversely determined, would materially and adversely affect its
financial condition or the conduct of its business. The Trust,
on behalf of the Acquired Fund, knows of no facts which might
form the basis for the institution of such proceedings and is not
a party to or subject to the provisions of any order, decree or
judgment of any court or governmental body which materially and
adversely affects its business or its ability to consummate the
transactions herein contemplated;
(i) The Statement of Assets and Liabilities, Statements of Operations
and Changes in Net Assets, and Schedule of Investments of the
Acquired Fund at June 30, 2004 have been audited by Ernst & Young
LLP, independent accountants, and are in accordance with
accounting principles generally accepted in the United States of
America ("GAAP") consistently applied, and such statements present
fairly, in all material respects, the financial condition of the
Acquired Fund as of such date in accordance with GAAP, and there
are no known contingent liabilities of the Acquired Fund required
to be reflected on a balance sheet (including the notes thereto)
in accordance with GAAP as of such date not disclosed therein;
(j) Since June 30, 2004, there has not been any material adverse
change in the Acquired Fund's financial condition, assets,
liabilities or business, other than changes occurring in the
ordinary course of business, or any incurrence by the Acquired
Fund of indebtedness other than in the ordinary course in
accordance with the Acquired Fund's investment restrictions.
For the purposes of this subparagraph (j), a decline in net
asset value per share of Acquired Fund Shares due to declines
in market values of securities held by the Acquired Fund,
the discharge of Acquired Fund liabilities, or the redemption
of Acquired Fund Shares by shareholders of the Acquired Fund
shall not constitute a material adverse change;
(k) On the Closing Date, all Federal and other tax returns, dividend
reporting forms, and other tax-related reports of the Acquired Fund
required by law to have been filed by such date (including any
extensions) shall have been filed and are or will be correct in all
material respects, and all Federal and other taxes shown as due or
required to be shown as due on said returns and reports shall have
been paid or provision shall have been made for the payment thereof
and, to the best knowledge of the Trust, no such return is
currently under audit and no assessment has been asserted with
respect to such returns;
(l) For each taxable year of its operation (including the taxable year
ending on the Closing Date), the Acquired Fund has met (or will
meet) the requirements of Subchapter M of the Code for qualification
as a regulated investment company, has been (or will be) eligible to
and has computed (or will compute) its Federal income tax under
Section 852 of the Code, and will have distributed all of its
investment company taxable income (computed without regard to any
deduction for dividends paid) and net capital gain (as defined in
the Code) that has accrued through the Closing Date, and before the
Closing Date will have declared dividends sufficient to distribute
all of its investment company taxable income (computed without
regard to any deduction for dividends paid) and net capital gain
(after reduction for any available capital loss carryover) for the
period ending on the Closing Date;
(m) All issued and outstanding Acquired Fund Shares are, and on the
Closing Date will be, duly and validly issued and outstanding,
fully paid and non-assessable by the Trust and have been offered
and sold in every state, territory and the District of Columbia in
compliance in all material respects with applicable registration
requirements of the 1933 Act and other securities laws. All of the
issued and outstanding Acquired Fund Shares will, at the time of
Closing, be held by the persons and in the amounts set forth in the
records of the Transfer Agent, on behalf of the Acquired Fund, as
provided in paragraph 3.3. The Acquired Fund does not have
outstanding any options, warrants or other rights to subscribe for
or purchase any of the Acquired Fund Shares, nor is there
outstanding any security convertible into any of the Acquired
Fund Shares;
(n) The execution, delivery and performance of this Agreement and
the transactions contemplated herein have been duly authorized by
all necessary action, if any, on the part of the Trustees of the
Trust, on behalf of the Acquired Fund, and, subject to the approval
of the shareholders of the Acquired Fund, this Agreement
constitutes a valid and binding obligation of the Trust, on behalf
of the Acquired Fund, enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting
creditors' rights and to general equity principles;
(o) The information to be furnished by the Acquired Fund for use in
registration statements, proxy materials and other documents filed
or to be filed with any Federal, state or local regulatory
authority (including the National Association of Securities
Dealers, Inc.), which may be necessary in connection with the
transactions contemplated hereby, shall be accurate and complete
in all material respects and shall comply in all material respects
with Federal securities and other laws and regulations thereunder
applicable thereto; and
(p) The combined proxy statement and prospectus ("Proxy Statement")
to be included in the Registration Statement referred to in
paragraph 5.5, insofar as it relates to the Acquired Fund, will,
on the effective date of the Registration Statement and on the
Closing Date (i) not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances under which such statements were made, not materially
misleading, provided, however, that the representations and
warranties of this subparagraph (p) shall not apply to statements
in or omissions from the Proxy Statement and the Registration
Statement made in reliance upon and in conformity with information
that was furnished by the Acquiring Fund for use therein, and (ii)
comply in all material respects with the provisions of the 1933
Act, the 1934 Act, and the 1940 Act and the rules and regulations
thereunder.
4.2. Except as has been fully disclosed to the Acquired Fund prior to the
date of this Agreement in a written instrument executed by an officer of
the Trust, the Trust, on behalf of the Acquiring Fund, represents and
warrants to the Acquired Fund as follows:
(a) The Acquiring Fund is duly organized as a series of the Trust,
which is a statutory trust duly organized, validly existing, and
in good standing under the laws of the State of Delaware, with
power under the Trust's Declaration to own all of its properties
and assets and to carry on its business as it is now being
conducted;
(b) The Trust is a registered investment company classified as a
management company of the open-end type, and its registration
with the Commission as an investment company under the 1940 Act
and the registration of the Class A, Class B, Class C, Class K
and Class Y Acquiring Fund Shares under the 1933 Act, is in full
force and effect;
(c) No consent, approval, authorization, or order of any court or
governmental authority is required for the consummation by the
Acquiring Fund of the transactions contemplated herein, except
such as may be required under the 1933 Act, the 1934 Act, the
1940 Act and state securities laws;
(d) The current prospectus and statement of additional information of
the Acquiring Fund and each prospectus and statement of
additional information of the Acquiring Fund used at all times
prior to the date of this Agreement conforms or conformed at the
time of its use 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 or did not
at the time of its use 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;
(e) The Acquiring Fund is not engaged currently, and the execution,
delivery and performance of this Agreement will not result, in (i)
a material violation of the Trust's Declaration or By-Laws or of
any agreement, indenture, instrument, contract, lease or other
undertaking to which the Trust, on behalf of the Acquiring Fund,
is a party or by which it is bound, or (ii) the acceleration of
any material obligation, or the imposition of any material
penalty, under any agreement, indenture, instrument, contract,
lease, judgment or decree to which the Trust, on behalf of the
Acquiring Fund, is a party or by which it is bound;
(f) No litigation or administrative proceeding or investigation of or
before any court or governmental body is presently pending or, to
its knowledge, threatened against the Trust, with respect to the
Acquiring Fund or any of the Acquiring Fund's properties or
assets, that, if adversely determined, would materially and
adversely affect the Acquiring Fund's financial condition or the
conduct of its business. The Trust, on behalf of the Acquiring
Fund, knows of no facts which might form the basis for the
institution of such proceedings and is not a party to or subject
to the provisions of any order, decree or judgment of any court
or governmental body which materially and adversely affects the
Acquiring Fund's business or its ability to consummate the
transactions herein contemplated;
(g) The Statement of Assets and Liabilities, Statements of
Operations and Changes in Net Assets and Schedule of Investments
of the Acquiring Fund at June 30, 2004 have been audited by
Ernst & Young LLP, independent accountants, and are in accordance
with GAAP consistently applied, and such statements present
fairly, in all material respects, the financial condition of the
Acquiring Fund as of such date in accordance with GAAP, and there
are no known contingent liabilities of the Acquiring Fund
required to be reflected on a balance sheet (including the notes
thereto) in accordance with GAAP as of such date not disclosed
therein;
(h) Since June 30, 2004, there has not been any material adverse
change in the Acquiring Fund's financial condition, assets,
liabilities or business, other than changes occurring in the
ordinary course of business, or any incurrence by the Acquiring
Fund of indebtedness other than in the ordinary course in
accordance with the Acquiring Fund's investment restrictions.
For purposes of this subparagraph (h), a decline in net asset
value per share of the Acquiring Fund Shares due to declines
in market values of securities held by the Acquiring Fund, the
discharge of Acquiring Fund liabilities, or the redemption of
Acquiring Fund Shares by shareholders of the Acquiring Fund,
shall not constitute a material adverse change;
(i) On the Closing Date, all Federal and other tax returns,
dividend reporting forms, and other tax-related reports of the
Acquiring Fund required by law to have been filed by such date
(including any extensions) shall have been filed and are or will
be correct in all material respects, and all Federal and other
taxes shown as due or required to be shown as due on said returns
and reports shall have been paid or provision shall have been
made for the payment thereof, and to the best knowledge of the
Trust no such return is currently under audit and no assessment
has been asserted with respect to such returns;
(j) For each taxable year of its operation (including the taxable
year that includes the Closing Date), the Acquiring Fund has
met (or will meet) the requirements of Subchapter M of the Code
for qualification as a regulated investment company, has been
eligible to (or will be eligible to) and has computed (or will
compute) its Federal income tax under Section 852 of the Code;
(k) All issued and outstanding Acquiring Fund Shares are, and on
the Closing Date will be, duly and validly issued and
outstanding, fully paid and non-assessable by the Trust and
have been offered and sold in every state, territory and the
District of Columbia in compliance in all material respects
with applicable registration requirements of the 1933 Act and
other securities laws. The Acquiring Fund does not have
outstanding any options, warrants or other rights to subscribe
for or purchase any Acquiring Fund Shares, nor is there
outstanding any security convertible into any Acquiring
Fund Shares;
(l) The execution, delivery and performance of this Agreement and
the transactions contemplated herein, have been duly
authorized by all necessary action, if any, on the part of the
Trustees of the Trust, on behalf of the Acquiring Fund, and
this Agreement constitutes a valid and binding obligation of
the Trust, on behalf of the Acquiring Fund, enforceable in
accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization, moratorium and other
laws relating to or affecting creditors' rights and to general
equity principles;
(m) The Class A, Class B, Class C, Class K and Class Y Acquiring
Fund Shares to be issued and delivered to the Acquired Fund,
for the account of the Acquired Fund Shareholders, pursuant to
the terms of this Agreement, will on the Closing Date have
been duly authorized and, when so issued and delivered, will
be duly and validly issued Acquiring Fund Shares, and will be
fully paid and non-assessable by the Acquiring Fund;
(n) The information to be furnished by the Acquiring Fund for use
in the registration statements, proxy materials and other
documents that may be necessary in connection with the
transactions contemplated hereby shall be accurate and
complete in all material respects and shall comply in all
material respects with Federal securities and other laws
and regulations applicable thereto; and
(o) The Proxy Statement to be included in the Registration
Statement referred to in paragraph 5.5 (and any amendment or
supplement thereto), insofar as it relates to the Acquiring
Fund and the Acquiring Fund Shares, will, from the effective
date of the Registration Statement through the date of the
meeting of shareholders of the Acquired Fund contemplated
therein and on the Closing Date (i) not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which
such statements were made, not materially misleading, provided,
however, that the representations and warranties of this
subparagraph (o) shall not apply to statements in or omissions
from the Proxy Statement and the Registration Statement made
in reliance upon and in conformity with information that was
furnished by the Acquired Fund for use therein, and (ii)
comply in all material respects with the provisions of the
1933 Act, the 1934 Act, and the 1940 Act and the rules and
regulations thereunder.
5. COVENANTS OF THE ACQUIRING FUND AND THE ACQUIRED FUND
5.1. The Acquiring Fund and the Acquired Fund each will operate its
business in the ordinary course between the date hereof and the
Closing Date, it being understood that such ordinary course of
business will include the declaration and payment of customary
dividends and distributions, and any other distribution that may
be advisable.
5.2. The Trust will call a meeting of the shareholders of the Acquired
Fund to consider and act upon this Agreement and to take all other
action necessary to obtain approval of the transactions
contemplated herein.
5.3. The Acquired Fund covenants that the Class A, Class B, Class C,
Class K and Class Y Acquiring Fund Shares to be issued hereunder
are not being acquired for the purpose of making any distribution
thereof, other than in accordance with the terms of this Agreement.
5.4. Subject to the provisions of this Agreement, the Acquiring Fund
and the Acquired Fund will each take, or cause to be taken, all
action, and do or cause to be done, all things reasonably
necessary, proper or advisable to consummate and make effective
the transactions contemplated by this Agreement.
5.5. The Trust, on behalf of the Acquired Fund, will prepare and file
a Proxy Statement (referred to in paragraph 4.1(p)) to be included
in a Registration Statement on Form N-14
("Registration Statement"), in compliance with the 1933 Act, the
1934 Act and the 1940 Act. The Acquired Fund will provide to the
Acquiring Fund such information regarding the Acquired Fund as may
be reasonably necessary for the preparation of the Registration
Statement
5.6. The Acquiring Fund and the Acquired Fund shall each use its
reasonable best efforts to fulfill or obtain the fulfillment of
the conditions precedent to effect the transactions contemplated by
this Agreement as promptly as practicable.
5.7. The Trust, on behalf of the Acquired Fund, shall execute and
deliver or cause to be executed and delivered all such assignments
and other instruments, and will take or cause to be taken such
further action as may be necessary or desirable in order to (1)
vest in and confirm (a) the title and possession of the Trust, on
behalf of the Acquired Fund, of the Acquiring Fund Shares to be
delivered hereunder and (b) the title and possession of the Trust,
on behalf of the Acquiring Fund, of all the Assets and (2)
otherwise to carry out the intent and purpose of this Agreement.
5.8. The Acquiring Fund will use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940
Act and such of the state blue sky or securities laws as may be
necessary in order to continue its operations after the Closing
Date.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUND
The obligations of the Trust, on behalf of the Acquired Fund, to
consummate the transactions provided for herein shall be subject, at the
Trust's election, to the performance by the Trust, on behalf of the
Acquiring Fund, of all the obligations to be performed by it hereunder
on or before the Closing Date, and, in addition thereto, the following
further conditions:
6.1. All representations and warranties of the Trust, on behalf of the
Acquiring Fund, contained in this Agreement shall be true and
correct in all material respects as of the date hereof and, except
as they may be affected by the transactions contemplated by this
Agreement, as of the Closing Date, with the same force and effect
as if made on and as of the Closing Date;
6.2. The Trust, on behalf of the Acquiring Fund, shall have delivered
to the Acquired Fund a certificate executed by the Trust's
President or Vice President and its Treasurer or Assistant
Treasurer, and dated as of the Closing Date, to the effect that
the representations and warranties of the Trust, on behalf of the
Acquiring Fund, made in this Agreement are true and correct at and
as of the Closing Date, except as they may be affected by the
transactions contemplated by this Agreement;
6.3. The Trust, on behalf of the Acquiring Fund, shall have performed
all of the covenants and complied with all of the provisions
required by this Agreement to be performed or complied with by the
Trust, on behalf of the Acquiring Fund, on or before the Closing
Date; and
6.4. The number of full and fractional Class A, Class B, Class C,
Class K and Class Y Acquiring Fund Shares to be issued in
connection with the Reorganization shall have been calculated in
accordance with paragraph 1.1.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND
The obligations of the Trust, on behalf of the Acquiring Fund, to
complete the transactions provided for herein shall be subject, at the
Trust's election, to the performance by the Trust, on behalf of the
Acquired Fund, of all of the obligations to be performed by it hereunder
on or before the Closing Date and, in addition thereto, the following
conditions:
7.1. All representations and warranties of the Trust, on behalf of the
Acquired Fund, contained in this Agreement shall be true and
correct in all material respects as of the date hereof and, except
as they may be affected by the transactions contemplated by this
Agreement, as of the Closing Date, with the same force and effect
as if made on and as of the Closing Date;
7.2. The Trust shall have delivered to the Acquiring Fund a statement
of the Acquired Fund's Assets and Liabilities, as of the Closing
Date, certified by the Treasurer of the Trust;
7.3. The Trust, on behalf of the Acquired Fund, shall have delivered to
the Acquiring Fund a certificate executed in the name of the
Acquired Fund by its President or Vice President and its Treasurer
or Assistant Treasurer and dated as of the Closing Date to the
effect that the representations and warranties of the Trust, on
behalf of the Acquired Fund, made in this Agreement are true and
correct at and as of the Closing Date, except as they may be
affected by the transactions contemplated by this Agreement;
7.4. The Trust, on behalf of the Acquired Fund, shall have performed
all of the covenants and complied with all of the provisions
required by this Agreement to be performed or complied with by the
Trust, on behalf of the Acquired Fund, on or before the Closing
Date;
7.5. The number of full and fractional Class A, Class B, Class C,
Class K and Class Y Acquiring Fund Shares to be issued in
connection with the Reorganization shall have been calculated in
accordance with paragraph 1.1; and
7.6. The Acquired Fund shall have declared and paid a distribution or
distributions prior to the Closing that, together with all
previous distributions, shall have the effect of distributing to
its shareholders (i) all of its investment company taxable income
and all of its net realized capital gains, if any, for the period
from the close of its last fiscal year to 4:00 p.m. Eastern time
on the Closing Date; and (ii) any undistributed investment company
taxable income and net realized capital gains from any period to
the extent not otherwise already distributed.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND AND
THE ACQUIRED FUND
If any of the conditions set forth below have not been satisfied on or
before the Closing Date with respect to the Trust, on behalf of the
Acquired Fund, or the Trust, on behalf of the Acquiring Fund, the Trust
may, at its option, refuse to consummate the transactions contemplated
by this Agreement:
8.1. The Agreement and the transactions contemplated herein shall have
been approved by the requisite vote of the holders of the
outstanding shares of the Acquired Fund in accordance with the
provisions of the Trust's Declaration and By-Laws, applicable
Delaware law and the 1940 Act, and certified copies of the
resolutions evidencing such approval shall have been delivered to
the Acquiring Fund. Notwithstanding anything herein to the
contrary, the Trust may not waive the conditions set forth in
this paragraph 8.1;
8.2. On the Closing Date no action, suit or other proceeding shall be
pending or, to the Trust's knowledge, threatened 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;
8.3. All consents of other parties and all other consents, orders and
permits of Federal, state and local regulatory authorities deemed
necessary by the Trust to permit consummation, in all material
respects, of the transactions contemplated hereby shall have been
obtained, except where failure to obtain any such consent, order
or permit would not involve a risk of a material adverse effect
on the assets or properties of the Acquiring Fund or the Acquired
Fund;
8.4. The Registration Statement shall have become effective under the
1933 Act and no stop orders suspending the effectiveness thereof
shall have been issued and, to the best knowledge of the parties
hereto, no investigation or proceeding for that purpose shall
have been instituted or be pending, threatened or contemplated
under the 1933 Act; and
8.5. The Trust shall have received the opinion of counsel to the
Trust addressed to the Trust substantially to the effect that,
based upon certain facts, assumptions, and representations, the
transaction contemplated by this Agreement shall constitute a
tax-free reorganization for Federal income tax purposes. The
delivery of such opinion is conditioned upon receipt by counsel
to the Trust of representations it shall request of the Trust.
Notwithstanding anything herein to the contrary, the Trust may
not consummate such transactions contemplated by the Agreement
if this condition is not satisfied.
9. INDEMNIFICATION
9.1. The Trust, out of the Acquiring Fund's assets and property
(including any amounts paid to the Acquiring Fund pursuant to
any applicable liability insurance policies or indemnification
agreements), agrees to indemnify and hold harmless the Acquired
Fund from and against any and all losses, claims, damages,
liabilities or expenses (including, without limitation, the
payment of reasonable legal fees and reasonable costs of
investigation) to which the Acquired Fund may become subject,
insofar as such loss, claim, damage, liability or expense
(or actions with respect thereto) arises out of or is based on
any breach by the Acquiring Fund of any of its representations,
warranties, covenants or agreements set forth in this Agreement,
provided that such indemnification by the Acquiring Fund is not
in violation of any applicable law.
9.2. The Trust, out of the Acquired Fund's assets and property
(including any amounts paid to the Acquired Fund pursuant to
any applicable liability insurance policies or indemnification
agreements), agrees to indemnify and hold harmless the Acquiring
Fund from and against any and all losses, claims, damages,
liabilities or expenses (including, without limitation, the
payment of reasonable legal fees and reasonable costs of
investigation) to which the Acquiring Fund may become subject,
insofar as such loss, claim, damage, liability or expense (or
actions with respect thereto) arises out of or is based on any
breach by the Acquired Fund of any of its representations,
warranties, covenants or agreements set forth in this Agreement,
provided that such indemnification by the Acquired Fund is not
in violation of any applicable law.
10. BROKERAGE FEES AND EXPENSES
10.1. The Trust, on behalf of the Acquiring Fund and on behalf
of the Acquired Fund, represents and warrants that there
are no brokers or finders entitled to receive any payments
in connection with the transactions provided for herein.
10.2. The expenses relating to the proposed Reorganization will
be borne solely by Munder Capital Management and its
affiliates. No such expenses shall be borne by the
Acquired Fund or the Acquiring Fund, except for brokerage
fees and expenses incurred in connection with the
Reorganization. The costs of the Reorganization shall
include, but not be limited to, costs associated with
obtaining any necessary order of exemption from the
1940 Act, if any, preparation of the Registration
Statement, printing and distributing the Proxy
Statement, legal fees, accounting fees, securities
registration fees, and expenses of holding shareholders'
meetings. Notwithstanding any of the foregoing, expenses
will in any event be paid by the party directly incurring
such expenses if and to the extent that the payment by
another person of such expenses would result in the
disqualification of such party as a "regulated investment
company" within the meaning of Section 851 of the Code.
11. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
11.1. The Trust has not made any representation, warranty or
covenant, on behalf of either the Acquired Fund or the
Acquiring Fund, not set forth herein, and this Agreement
constitutes the entire agreement between the Acquiring
Fund and Acquired Fund with respect to the Reorganization.
11.2. The representations, warranties and covenants contained
in this Agreement or in any document delivered pursuant
hereto or in connection herewith shall survive the
consummation of the transactions contemplated hereunder.
The covenants to be performed after the Closing and the
obligations of each of the Acquired Fund and Acquiring
Fund in Sections 9.1 and 9.2 shall survive the Closing.
12. TERMINATION
This Agreement may be terminated and the transactions contemplated
hereby may be abandoned by resolution of the Trust's Board of
Trustees, at any time prior to the Closing Date, if circumstances
should develop that, in its opinion, make proceeding with the
Agreement inadvisable.
13. AMENDMENTS
This Agreement may be amended, modified or supplemented in such
manner as may be deemed necessary or advisable by the authorized
officers of the Trust; provided, however, that following the meeting
of the shareholders of the Acquired Fund called by the Trust pursuant
to paragraph 5.2 of this Agreement, no such amendment may have the
effect of changing the provisions for determining the number of
Class A, Class B, Class C, Class K and Class Y Acquiring Fund Shares
to be issued to the Class A, Class B, Class C, Class K and Class Y
Acquired Fund Shareholders, respectively, under this Agreement to
the detriment of such shareholders without their further approval.
14. HEADINGS; GOVERNING LAW; ASSIGNMENT; LIMITATION OF LIABILITY
14.1. The Article and paragraph headings contained in this
Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation
of this Agreement.
14.2. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without
regard to its principles of conflicts of laws.
14.3. This Agreement shall bind and inure to the benefit of
the parties hereto and their respective successors and
assigns, but no assignment or transfer hereof or of any
rights or obligations hereunder shall be made by any
party without the written consent of the other party.
Nothing herein expressed or implied is intended or shall
be construed to confer upon or give any person, firm or
corporation, other than the parties hereto and their
respective successors and assigns, any rights or
remedies under or by reason of this Agreement.
[SIGNATURES ON FOLLOWING PAGE]
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed by its President or Vice President.
MUNDER SERIES TRUST, on behalf of its MUNDER SMALL COMPANY GROWTH FUND
By:
Title:
MUNDER SERIES TRUST, on behalf of its MUNDER MICRO-CAP EQUITY FUND
By:
Title:
With respect to Section 10.2 of this Agreement, Accepted and
Acknowledged by:
MUNDER CAPITAL MANAGEMENT
By:
Title:
273566.3.DC_03
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