AGREEMENT
and
PLAN OF REORGANIZATION
for
XXXXX CAPITAL DEVELOPMENT FUND, INC.
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS................................................... 2
Section 1.1. Definitions............................... 2
ARTICLE II
TRANSFER OF ASSETS............................................ 5
Section 2.1. Reorganization of Xxxxx Capital Development 5
Section 2.2. Computation of Net Asset Value............ 5
Section 2.3. Excluded Assets........................... 6
Section 2.4. Valuation Date............................ 6
Section 2.5. Delivery.................................. 7
Section 2.6. Dissolution............................... 7
Section 2.7. Issuance of AIM Equity Shares............. 7
Section 2.8. Investment Securities..................... 8
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF XXXXX CAPITAL DEVELOPMENT... 9
Section 3.1. Incorporation: Qualification and
Corporate Authority....................... 9
Section 3.2. Registration and Regulation of Xxxxx Capital
Development............................... 9
Section 3.3. Financial Statements...................... 9
Section 3.4. No Material Adverse Changes;
Contingent Liabilities.................... 10
Section 3.5. BCD Shares; Liabilities................... 10
Section 3.6. Accountants............................... 11
Section 3.7. Binding Obligation........................ 11
Section 3.8. No Breaches or Defaults................... 11
Section 3.9. Authorizations or Consents................ 12
Section 3.10. Permits................................... 12
Section 3.11. No Actions, Suits or Proceedings.......... 12
Section 3.12. Contracts................................. 13
Section 3.13. Properties and Assets..................... 13
Section 3.14. Ineligible Persons........................ 13
Section 3.15. Rule 17e-1................................ 14
Section 3.16. Taxes..................................... 14
Section 3.17. Benefit and Employment Obligations........ 15
Section 3.18. Brokers................................... 15
Section 3.19. Voting Requirements; Dissenter's Rights... 15
Section 3.20. State Takeover Statutes................... 15
Section 3.21. Books and Records......................... 15
Section 3.22. Prospectus................................ 16
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF AIM EQUITY.................. 16
Section 4.1. Incorporation: Qualification and
Corporate Authority....................... 16
Section 4.2. Binding Obligation........................ 16
Section 4.3. No Breaches or Defaults................... 16
Section 4.4. Authorizations or Consents................ 17
Section 4.5. Permits................................... 17
Section 4.6. No Actions, Suits or Proceedings.......... 17
Section 4.7. Ineligible Persons........................ 18
Section 4.8. Brokers................................... 18
Section 4.9. Registration and Regulation............... 18
Section 4.10. Registration of Portfolio Shares.......... 19
Section 4.11. Representations Concerning
the Reorganization........................ 19
Section 4.12. Prospectus................................ 20
ARTICLE V
COVENANTS..................................................... 20
Section 5.1. Conduct of Business....................... 20
Section 5.2. Confidentiality and Announcements......... 22
Section 5.3. Expenses.................................. 24
Section 5.4. Further Assurances........................ 24
Section 5.5. Notice of Events.......................... 24
Section 5.6. Access to Information..................... 25
Section 5.7. Consents, Approvals and Filings........... 25
Section 5.8. Submission of Agreement to Shareholders... 25
Section 5.9. Acquisition Proposals..................... 26
Section 5.10. Fiduciary Duties.......................... 26
Section 5.11. Section 15(f) of the 1940 Act............. 27
ARTICLE VI
CONDITIONS PRECEDENT TO THE REORGANIZATION.................... 28
Section 6.1. Conditions Precedent of AIM Equity........ 28
Section 6.2. Mutual Conditions......................... 28
Section 6.3. Conditions Precedent of
Xxxxx Capital Development................. 31
ARTICLE VII
TERMINATION OF AGREEMENT...................................... 32
Section 7.1. Termination............................... 32
Section 7.2. Survival After Termination................ 33
ARTICLE VIII
MISCELLANEOUS................................................. 33
Section 8.1. Nonsurvival of Representations
and Warranties............................ 33
Section 8.2. Law Governing............................. 33
Section 8.3. Binding Effect, Persons Benefiting,
No Assignment............................. 34
Section 8.4. Obligation of AIM Equity Portfolio........ 34
Section 8.5. Amendments................................ 34
Section 8.6. Enforcement............................... 34
Section 8.7. Interpretation............................ 34
Section 8.8. Counterparts.............................. 35
Section 8.9. Entire Agreement; Schedules............... 35
Section 8.10. Notices................................... 35
Schedule 3.12(a) - Contracts
Schedule 6.1(d) - Opinion of Counsel to Xxxxx Capital Development
Schedule 6.2(g) - Tax Opinions
Schedule 6.3(d) - Opinion of Counsel to AIM Equity
AGREEMENT AND PLAN OF REORGANIZATION
AGREEMENT AND PLAN OF REORGANIZATION, dated as of December 20, 1995
(this "Agreement"), by and between Xxxxx Capital Development Fund, Inc., a
Wisconsin corporation ("Xxxxx Capital Development"), and AIM Equity Funds, Inc.,
a Maryland corporation ("AIM Equity"), acting on behalf of AIM Capital
Development Fund (the "Portfolio").
WITNESSETH
WHEREAS, Xxxxx Capital Development is an investment company
registered with the Securities and Exchange Commission (the "SEC") under the
Investment Company Act (as defined below); and
WHEREAS, AIM Equity is an investment company registered with the SEC
under the Investment Company Act that offers separate classes of its shares
representing interests in several investment portfolios for sale to the public;
and
WHEREAS, Xxxxx Capital Development owns securities in which the
Portfolio is permitted to invest; and
WHEREAS, Xxxxx Capital Development desires to provide for its
reorganization through the transfer of substantially all of its assets to the
Portfolio in exchange for shares of the Portfolio issued in the manner set forth
in this Agreement; and
WHEREAS, this Agreement is intended to be and is adopted as a Plan
of Reorganization and Liquidation within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code").
NOW, THEREFORE, in consideration of the foregoing premises and the
agreements and undertakings of AIM Equity and Xxxxx Capital Development
contained in this Agreement, AIM Equity and Xxxxx Capital Development agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. (a) For all purposes in this Agreement,
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the following terms shall have the respective meanings set forth in this Section
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1.1 (such definitions to be equally applicable to both the singular and plural
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forms of the terms herein defined):
"Acquisition Proposal" means, except for the transactions contemplated
hereby, any proposal with respect to a merger, reorganization, consolidation,
share exchange or similar transaction involving Xxxxx Capital Development, or
any purchase of all or any significant portion of the assets of Xxxxx Capital
Development, or any equity interest in Xxxxx Capital Development.
"AEF Registration Statement" means the registration statement on Form
N-1A of AIM Equity, as amended, Registration No. 2-25469/811-1424, that is
applicable to the Portfolio.
"Advisers Act" means the Investment Advisers Act of 1940, as amended,
and all rules and regulations of the SEC adopted pursuant thereto.
"Affiliated Person" means an affiliated person as defined in Section
2(a)(3) of the Investment Company Act.
"Agreement" means this Agreement and Plan of Reorganization together
with all schedules and exhibits attached hereto and all amendments hereto and
thereof.
"AIM Equity" means AIM Equity Funds, Inc., a Maryland corporation.
"Xxxxx Capital Development" means Xxxxx Capital Development Fund,
Inc., a Wisconsin corporation.
"BCD Financial Statements" shall have the meaning set forth in Section
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3.3 of this Agreement.
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"BCD Shareholders" means the holders of record as of the Closing Date
of the issued and outstanding shares of the capital stock of Xxxxx Capital
Development.
"BCD Shareholders Meeting" means a meeting of the shareholders of
Xxxxx Capital Development convened in accordance with applicable law and the
articles of incorporation of Xxxxx Capital Development to consider and vote upon
the approval of this Agreement and the transactions contemplated by this
Agreement.
"BCD Shares" means the issued and outstanding shares of the capital
stock of Xxxxx Capital Development.
"Benefit Plan" means any material "employee benefit plan" (as defined
in Section 3(3) of ERISA) and any material bonus, deferred compensation,
incentive compensation, stock ownership, stock purchase, stock option, phantom
stock, vacation, retirement, profit sharing, welfare plans or other plan,
arrangement or understanding maintained or contributed to by Xxxxx Capital
Development, or otherwise providing benefits to any current or former employee,
officer or director of Xxxxx Capital Development.
"Closing" means the transfer of the assets of Xxxxx Capital
Development against the delivery of Portfolio Shares directly to the
shareholders of Xxxxx Capital Development as described in Section 2.1 of this
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Agreement.
"Closing Date" means March 29, 1996, or such other date as the parties
may mutually determine.
"Code" means the Internal Revenue Code of 1986, as amended.
"Confidential Information" shall have the meaning set forth in Section
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5.2(a) of this Agreement.
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"Custodian" means State Street Bank and Trust Company acting in its
capacity as custodian for the assets of the Portfolio.
"Effective Time" shall mean 2:00 p.m. Central Time on the Closing
Date.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Exchange Act" means the Securities and Exchange Act of 1934, as
amended, and all rules and regulations adopted by the SEC pursuant thereto.
"Excluded Assets" shall have the meaning set forth in Section 2.3 of
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this Agreement.
"Governmental Authority" means any foreign, United States or state
government, government agency, department, board, commission (including the SEC)
or instrumentality, and any court, tribunal or arbitrator of competent
jurisdiction, and any governmental or non-governmental self-regulatory
organization, agency or authority (including the National Association of
Securities Dealers, Inc., the Commodities and Futures Trading Commission, the
National Futures Association, the Investment Management Regulatory Organization
Limited and the Office of Fair Trading).
"Investment Company Act" means the Investment Company Act of 1940, as
amended, and all rules and regulations adopted by the SEC pursuant thereto.
"Lien" means any pledge, lien, security interest, charge, claim or
encumbrance of any kind.
"Material Adverse Effect" means an effect that would cause a change in
the condition (financial or otherwise), properties, assets or prospects of an
entity having an adverse monetary effect in an amount equal to or greater than
$50,000.
"Person" means an individual or a corporation, partnership, joint
venture, association, trust, unincorporated organization or other entity.
"Portfolio" means AIM Capital Development Fund, an investment
portfolio of AIM Equity.
"Portfolio Shares" means shares of common stock of AIM Equity, par
value $.001, each representing an interest in the Portfolio.
"Reorganization" means the acquisition of certain of the assets of
Xxxxx Capital Development by the Portfolio in consideration of the issuance of
Portfolio Shares directly to BCD Shareholders as described in this Agreement.
"Required BCD Shareholder Vote" shall have the meaning set forth in
Section 3.19 of this Agreement.
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"Return" means any return, report or form or any attachment thereto
required to be filed with any taxing authority.
"SEC" means the United States Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and all
rules and regulations adopted by the SEC pursuant thereto.
"Tax" means any tax or similar governmental charge, impost or levy
(including, without limitation, income taxes (including, without limitation,
alternative minimum tax and estimated tax), franchise taxes, transfer taxes or
fees, sales taxes, use taxes, gross receipts taxes, value added taxes,
employment taxes, excise taxes, ad valorem taxes, property taxes, withholding
taxes, payroll taxes, minimum taxes, or windfall profit taxes), together with
any related penalties, fines, additions to tax or interest, imposed by the
United States or any state, county, local or foreign government or subdivision
or agency thereof.
"Valuation Date" shall have the meaning set forth in Section 2.4 of
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this Agreement.
ARTICLE II
TRANSFER OF ASSETS
Section 2.1. Reorganization of Xxxxx Capital Development. At
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the Effective Time, all of the assets of Xxxxx Capital Development, except the
Excluded Assets, shall be delivered to the Custodian for the account of the
Portfolio in exchange for, and against delivery by AIM Equity directly to the
BCD Shareholders at the opening of business on the Closing Date of a number of
Portfolio Shares (including, if applicable, fractional shares rounded to the
nearest thousandth) having an aggregate net asset value equal to the net value
of the assets of Xxxxx Capital Development so transferred, assigned and
delivered, all determined and adjusted as provided in Section 2.2 below. Upon
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delivery of such assets, the Portfolio will receive good and marketable title to
such assets free and clear of all Liens.
Section 2.2. Computation of Net Asset Value.
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(a) The net asset value of the Portfolio Shares and the net value
of the assets of Xxxxx Capital Development subject to this Agreement shall, in
each case, be determined as of the close of business on the NYSE on the
Valuation Date.
(b) The net asset value of the Portfolio Shares shall be computed
in the manner set forth in accordance with the policies and procedures of the
Portfolio as described in the AEF Registration Statement.
(c) The net value of the assets of Xxxxx Capital Development
subject to this Agreement shall be computed by AIM Equity and shall be subject
to adjustment by the amount, if any, agreed to by Xxxxx Capital Development and
AIM Equity. In determining the value of the securities transferred by Xxxxx
Capital Development to the Portfolio, each security shall be priced in
accordance with the policies and procedures of the Portfolio as described in the
AEF Registration Statement. For such purposes, market quotes and the security
characteristics relating to establishing such quotes shall be determined by AIM
Equity, with the approval of Xxxxx Capital Development. Securities for which
market quotes are not available shall be valued as mutually agreed by AIM Equity
and Xxxxx Capital Development, provided that such value is consistent with the
pricing procedures adopted by AIM Equity. All computations shall be made by AIM
Equity in cooperation with the auditors of AIM Equity and the auditors of Xxxxx
Capital Development, who will apply certain procedures agreed to by AIM Equity
and Xxxxx Capital Development to test such computations.
Section 2.3. Excluded Assets. There shall be deducted from the
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assets of Xxxxx Capital Development described in Section 2.1 all organizational
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expenses, any prepaid expenses that would not have value to the Portfolio and
cash in an amount estimated by Xxxxx Capital Development to be sufficient to pay
all the liabilities of Xxxxx Capital Development, including, without limitation,
(I) amounts owed or to be owed to any BCD Shareholder, including declared but
unpaid dividends, (ii) accounts payable, taxes and other accrued and unpaid
expenses, if any, incurred in the normal operation of its business up to and
including the Closing Date and (iii) the costs and expenses incurred by Xxxxx
Capital Development in making and carrying out the transactions contemplated by
this Agreement.
Section 2.4. Valuation Date. The assets of Xxxxx Capital
--------------
Development and the net asset value per share of the Portfolio Shares shall be
valued as of the close of business on the NYSE on the business day next
preceding the Closing Date (the "Valuation Date"). The stock transfer books of
Xxxxx Capital Development will be permanently closed as of the close of business
on the Valuation Date and only requests for the redemption of shares of Xxxxx
Capital Development received in proper form prior to the close of trading on the
NYSE on the Valuation Date shall be accepted by Xxxxx Capital Development.
Redemption requests thereafter received by Xxxxx Capital Development shall be
deemed to be redemption requests for Portfolio Shares (assuming that the
transactions contemplated by this Agreement have been consummated) to be
distributed to BCD Shareholders under this Agreement.
Section 2.5. Delivery.
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(a) Assets held by Xxxxx Capital Development shall be delivered by
Xxxxx Capital Development to the Custodian on the Closing Date. No later than
three (3) business days preceding the Closing Date Xxxxx Capital Development
shall instruct its custodian to make such delivery to the Custodian. Xxxxx
Capital Development shall further instruct its custodian that any trade made by
Xxxxx Capital Development during the three day period before the Closing Date
shall settle at the Custodian. The assets so delivered shall be duly endorsed
in proper form for transfer in such condition as to constitute a good delivery
thereof, in accordance with the custom of brokers, and shall be accompanied by
all necessary state stock transfer stamps, if any, or a check for the
appropriate purchase price thereof. Cash held by Xxxxx Capital Development
(other than cash held as part of the Excluded Assets) shall be delivered at the
Effective Time and shall be in the form of currency or wire transfer in Federal
funds, payable to the order of the account of the Portfolio at the Custodian.
(b) If, on the Closing Date, Xxxxx Capital Development is unable
to make delivery in the manner contemplated by Section 2.5(a) of securities held
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by Xxxxx Capital Development for the reason that any of such securities
purchased prior to the Closing Date have not yet been delivered to Xxxxx Capital
Development, its broker or brokers, then, AIM Equity shall waive the delivery
requirements of Section 2.5(a) with respect to said undelivered securities, if
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Xxxxx Capital Development has delivered to the Custodian by or on the Closing
Date and with respect to said undelivered securities, executed copies of an
agreement of assignment and escrow agreement and due bills executed on behalf of
said broker or brokers, together with such other documents as may be required by
AIM Equity or the Custodian, including brokers' confirmation slips.
Section 2.6. Dissolution. As soon as reasonably practicable
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after the Closing Date, Xxxxx Capital Development shall pay or make provisions
for all of its debts, liabilities and taxes and distribute all remaining assets
to the BCD Shareholders, and Xxxxx Capital Development shall be dissolved and
deregistered under the Investment Company Act and under applicable state laws,
provided that, in the event that the transactions contemplated herein are not
approved by the BCD Shareholders, Xxxxx Capital Development shall not be
obligated to so dissolve and deregister.
Section 2.7. Issuance of AIM Equity Shares. At the Closing
-----------------------------
Date, Xxxxx Capital Development shall instruct AIM Equity that the pro rata
interest of each of BCD Shareholders of record as of the close of business on
the Valuation Date, as certified by Xxxxx Capital Development's transfer agent,
in the Portfolio Shares be registered on the books of AIM Equity in full and
fractional shares in the name of each BCD Shareholder, and AIM Equity agrees
promptly to comply with said instruction. All issued and outstanding shares of
Xxxxx Capital Development's capital stock shall thereupon be canceled on the
books of Xxxxx Capital Development. AIM Equity shall have no obligation to
inquire as to the validity, propriety or correctness of any such instruction,
but shall, in each case, assume that such instruction is valid, proper and
correct. AIM Equity shall record on its books the ownership of the Portfolio
Shares by BCD Shareholders and shall forward a confirmation of such ownership to
the BCD Shareholders. No redemption or repurchase of such shares credited to
former BCD Shareholders in respect of Xxxxx Capital Development shares
represented by unsurrendered stock certificates shall be permitted until such
certificates have been surrendered to AIM Equity for cancellation, or if such
certificates are lost or misplaced, until lost certificate affidavits have been
executed and delivered to AIM Equity.
Section 2.8. Investment Securities.
---------------------
(a) It is expressly understood that Xxxxx Capital Development may
hereafter sell any securities owned by it in the ordinary course of its business
as a diversified, open-end, management investment company. Upon written request
by AIM Equity, Xxxxx Capital Development shall (i) prior to the Closing Date,
dispose of equity securities held by it to assure that AIM Equity does not own
ten percent (10%) or more of the outstanding voting securities of any issuer as
a result of the Reorganization, or (ii) cooperate with and assist AIM Equity in
preparing and filing on the Closing Date the notification and report form
required by the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act, in which case the
Closing shall be delayed until the end of the waiting period prescribed by such
act.
(b) On or prior to the Valuation Date, Xxxxx Capital Development
shall deliver a list setting forth the securities it then owns together with the
respective Federal income tax bases thereof. Xxxxx Capital Development shall
provide to AIM Equity on or before the Valuation Date, detailed tax basis
accounting records for each security to be transferred to it pursuant to this
Agreement. Such records shall be prepared in accordance with the requirements
for specific identification tax lot accounting and clearly reflect the bases
used for determination of gain and loss realized on the partial sale of any
security transferred to the Portfolio hereunder. Such records shall be made
available by Xxxxx Capital Development prior to the Valuation Date for
inspection by the Treasurer (or his designee) or the auditors of AIM Equity upon
reasonable request.
2.9. Liabilities and Expenses. The Portfolio shall not assume any
------------------------
liabilities of Xxxxx Capital Development and Xxxxx Capital Development shall use
its reasonable best efforts to discharge all known liabilities, as far as may be
possible, prior to the Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF XXXXX CAPITAL DEVELOPMENT
Xxxxx Capital Development represents and warrants to AIM Equity that:
Section 3.1. Incorporation: Qualification and Corporate Authority.
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Xxxxx Capital Development has been duly incorporated and is validly existing and
in active status under the laws of the State of Wisconsin with all requisite
corporate power and authority to conduct its business as presently conducted.
Section 3.2. Registration and Regulation of Xxxxx Capital
--------------------------------------------
Development. Xxxxx Capital Development is duly registered with the SEC as an
-----------
investment company under the Investment Company Act and all BCD Shares which
have been or are being offered for sale have been duly registered under the
Securities Act and have been duly registered, qualified or are exempt from
registration or qualification under the securities laws of each state or other
jurisdiction in which such shares have been or are being offered for sale, and
no action has been taken by Xxxxx Capital Development to revoke or rescind any
such registration or qualification. Xxxxx Capital Development is in compliance
in all material respects with all applicable laws, rules and regulations,
including, without limitation, the Investment Company Act, the Securities Act,
the Exchange Act and all applicable state securities laws. Xxxxx Capital
Development is in compliance in all material respects with the applicable
investment policies and restrictions set forth in its registration statement
currently in effect. The value of the net assets of Xxxxx Capital Development is
determined using portfolio valuation methods that comply in all material
respects with the requirements of the Investment Company Act and the policies of
Xxxxx Capital Development and all purchases and redemptions of BCD Shares have
been effected at the net asset value per share calculated in such manner.
Section 3.3. Financial Statements. The books of account and related
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records of Xxxxx Capital Development fairly reflect in reasonable detail its
assets, liabilities and transactions in accordance with generally accepted
accounting principles applied on a consistent basis. The audited financial
statements dated September 30, 1995 of Xxxxx Capital Development previously
delivered to AIM Equity (the "BCD Financial Statements") present fairly in all
material respects the financial position of Xxxxx Capital Development as at the
dates indicated and the results of operations and cash flows for the periods
then ended in accordance with generally accepted accounting principles applied
on a consistent basis for the periods then ended.
Section 3.4. No Material Adverse Changes; Contingent Liabilities.
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Since September 30, 1995, no material adverse change has occurred in the
financial condition, results of operations, business, assets or liabilities of
Xxxxx Capital Development or the status of Xxxxx Capital Development as a
regulated investment company under the Code, other than changes resulting from
any change in general conditions in the financial or securities markets or the
performance of any investments made by Xxxxx Capital Development or occurring in
the ordinary course of business of Xxxxx Capital Development. There are no
contingent liabilities of Xxxxx Capital Development not disclosed in the BCD
Financial Statements which are required to be disclosed in accordance with
generally accepted accounting principles.
Section 3.5. BCD Shares; Liabilities.
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(a) The BCD Shares have been duly authorized and validly issued and
are fully paid and non-assessable (except as provided in Wisconsin Business
Corporation Law Section 180.0622(2)(b)).
(b) There is no plan or intention by the shareholders of Xxxxx
Capital Development who own five percent (5%) or more of the BCD Shares, and to
the knowledge of Xxxxx Capital Development's management, the remaining BCD
Shareholders have no present plan or intention of selling, exchanging, redeeming
or otherwise disposing of a number of the Portfolio Shares received by them in
connection with the Reorganization that would reduce the BCD Shareholders'
ownership of Portfolio Shares to a number of shares having a value, as of the
Closing Date, of less than fifty percent (50%) of the value of all of the
formerly outstanding BCD Shares as of the same date. For purposes of this
Section 3.5, BCD Shares exchanged for cash or other property or exchanged for
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cash in lieu of fractional shares of the Portfolio will be treated as
outstanding BCD Shares on the date of the Reorganization. Moreover, BCD Shares
and Portfolio Shares held by BCD Shareholders and otherwise sold, redeemed or
disposed of prior or subsequent to the Reorganization will be considered in
making this representation, except for BCD Shares or Portfolio Shares which have
been, or will be, redeemed by Xxxxx Capital Development or the Portfolio in the
ordinary course of its business as an open-end, diversified management
investment company (or a series thereof) under the Investment Company Act.
(c) At the time of the Reorganization, Xxxxx Capital Development
shall not have outstanding any warrants, options, convertible securities or any
other type of right pursuant to which any Person could acquire BCD Shares,
except for the right of investors to acquire BCD Shares at net asset value in
the normal course of its business as an open-end diversified management
investment company operating under the Investment Company Act.
(d) Throughout the five-year period ending on the Closing Date, Xxxxx
Capital Development will have conducted its historic business within the meaning
of Section 1.368-1(d) of the Income Tax Regulations under the Code in a
substantially unchanged manner. In anticipation of the Reorganization, Xxxxx
Capital Development will not dispose of assets that, in the aggregate, will
result in less than fifty percent (50%) of its historic business assets being
transferred to the Portfolio.
(e) Xxxxx Capital Development does not have, and has not had during
the six (6) months prior to the date of this Agreement, any employees, and shall
not hire any employees from and after the date of this Agreement through the
Closing Date.
Section 3.6. Accountants. Price Waterhouse, LLP, which has reported
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upon BCD Financial Statements for the period ended September 30, 1995, are
independent public accountants as required by the Securities Act and the
Exchange Act.
Section 3.7. Binding Obligation. This Agreement has been duly
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authorized, executed and delivered by Xxxxx Capital Development and, assuming
this Agreement has been duly executed and delivered by AIM Equity and approved
by the BCD Shareholder, constitutes the legal, valid and binding obligation of
Xxxxx Capital Development, enforceable against Xxxxx Capital Development in
accordance with its terms, except as the enforceability hereof may be limited by
bankruptcy, insolvency, reorganization or similar laws relating to or affecting
creditors' rights generally or by general equity principles (whether applied in
a court of law or a court of equity and including limitations on the
availability of specific performance or other equitable remedies).
Section 3.8. No Breaches or Defaults. The execution and delivery of
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this Agreement by Xxxxx Capital Development and performance by Xxxxx Capital
Development of its obligations hereunder has been duly authorized by all
necessary corporate action on the part of Xxxxx Capital Development, other than
BCD Shareholder approval, and (i) does not and, on the Closing Date, will not
result in any violation of the articles of incorporation or by-laws of Xxxxx
Capital Development and (ii) does not and, will not on the Closing Date, result
in a breach of any of the terms or provisions of, or constitute (with or without
the giving of notice or the lapse of time or both) a default under, or give rise
to a right of termination, cancellation or acceleration of any obligation or to
the loss of a material benefit under, or result in the creation or imposition of
any Lien upon any property or assets of Xxxxx Capital Development (except for
such breaches or defaults or Liens that would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect) under (A)
any indenture, mortgage or loan agreement or any other material agreement or
instrument to which Xxxxx Capital Development is a party or by which it may be
bound or to which any of its properties may be subject; (B) any Permit; or (C)
any existing applicable law, rule, regulation, judgment, order or decree of any
Governmental Authority having jurisdiction over Xxxxx Capital Development or any
of its properties. Xxxxx Capital Development is not under the jurisdiction of a
court in a Title 11 or similar case within the meaning of Section 368(a)(3)(A)
of the Code.
Section 3.9. Authorizations or Consents. Other than those which
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shall have been obtained or made on or prior to the Closing Date and those that
must be made after the Closing Date to comply with Section 2.6 of this
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Agreement, no authorization or approval or other action by, and no notice to or
filing with, any Governmental Authority will be required to be obtained or made
by Xxxxx Capital Development in connection with the due execution and delivery
by Xxxxx Capital Development of this Agreement and the consummation by Xxxxx
Capital Development of the transactions contemplated hereby.
Section 3.10. Permits. Xxxxx Capital Development has in full force
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and effect all Federal, state, local and foreign governmental approvals,
consents, authorizations, certificates, filings, franchises, licenses, notices,
permits and rights (collectively, "Permits") necessary for it to conduct its
business as presently conducted, and there has occurred no default under any
Permit, except for the absence of Permits and for defaults under Permits the
absence or default of which would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect. To the knowledge
of Xxxxx Capital Development there are no proceedings relating to the
suspension, revocation or modification of any Permit, except for such that would
not reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.
Section 3.11. No Actions, Suits or Proceedings.
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(a) There is no pending action, litigation or proceeding, nor, to the
knowledge of Xxxxx Capital Development, has any litigation been overtly
threatened in writing or orally, against Xxxxx Capital Development before any
Governmental Authority which questions the validity or legality of this
Agreement or of the actions contemplated hereby or which seeks to prevent the
consummation of the transactions contemplated hereby, including the
Reorganization.
(b) There are no legal, administrative or arbitration actions, suits,
or proceedings instituted or pending or, to the knowledge of Xxxxx Capital
Development, threatened in writing or, if probable of assertion, orally against
Xxxxx Capital Development or affecting any property, asset, interest, or right
of Xxxxx Capital Development, that could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect. There are not in
existence on the date hereof any plea agreements, judgments, injunctions,
consents, decrees, exceptions or orders that were entered by, filed with or
issued by Governmental Authority relating to the conduct of the business of
Xxxxx Capital Development affecting in any significant respect the conduct of
its business. Xxxxx Capital Development is not, and has not been, to the
knowledge of Xxxxx Capital Development, the target of any investigation by the
SEC or any state securities administrator.
Section 3.12. Contracts.
---------
(a) Except for the contracts and agreements listed on Schedule
--------
3.12(a), Xxxxx Capital Development is not a party to any material contract, debt
-------
arrangement, futures contract, plan, lease, franchise or permit of any kind or
nature whatsoever.
(b) Xxxxx Capital Development is not in default under any contract,
agreement, commitment, arrangement, lease, insurance policy or other instrument
to which it is a party, by which its assets, business, or operations may be
bound or affected, or under which it or its assets, business or operations
receives benefits, and which default could reasonably be expected, individually
or in the aggregate, to have a Material Adverse Effect, and, to the knowledge of
Xxxxx Capital Development, there has not occurred any event that, with the lapse
of time or the giving of notice or both, would constitute such a default.
Section 3.13. Properties and Assets. Xxxxx Capital Development has
--------------------
good and marketable title to all properties and assets reflected in BCD
Financial Statements as owned by it, free and clear of all Liens except as
described in the BCD Financial Statements.
Section 3.14. Ineligible Persons. Except as previously disclosed to
------------------
AIM Equity, neither Xxxxx Capital Development nor any "Affiliated Person" of
Xxxxx Capital Development has been convicted of any felony or misdemeanor,
described in Section 9(a)(1) of the Investment Company Act, nor has any
Affiliated Person of Xxxxx Capital Development been subject, or presently is
subject, to any disqualification that would be a basis for denial, suspension or
revocation of registration of an investment adviser under Section 203(e) of the
Advisers Act or Rule 206(4)-4(b) thereunder or of a broker-dealer under Section
15 of the Exchange Act, or for disqualification as an investment adviser,
employee, officer or director of an investment company under Section 9 of the
Investment Company Act, and, to Xxxxx Capital Development's knowledge, there is
no proceeding or investigation that is reasonably likely to become the basis for
any such disqualification, denial, suspension or revocation.
Section 3.15. Rule 17e-1. Xxxxx Capital Development has duly adopted
----------
procedures pursuant to Rule 17e-1 under the Investment Company Act, to the
extent applicable, and Xxxxx Capital Development currently complies and will
comply with the requirements of Section 17(e) of the Investment Company Act and
Rule 17e-1 thereunder, to the extent applicable.
Section 3.16. Taxes.
-----
(a) Xxxxx Capital Development has elected to be treated as a
regulated investment company under Subchapter M of the Code. Xxxxx Capital
Development has qualified as such for each taxable year since inception and that
has ended prior to the Closing Date and will have satisfied the requirements of
Section 851(b) of the Code for the period beginning on the first day of its
current taxable year and ending on the Closing Date. In order to (i) insure
continued qualification of Xxxxx Capital Development as a "regulated investment
company" for tax purposes and (ii) eliminate any tax liability of Xxxxx Capital
Development arising by reason of undistributed investment company taxable income
or net taxable gain, Xxxxx Capital Development will declare to the BCD
Shareholders of record on or prior to the Valuation Date a dividend or dividends
that, together with all such previous dividends shall have the effect of
distributing (A) all of its investment company taxable income (determined
without regard to any deductions for dividends paid) for the taxable year ended
September 30, 1995 and for the short taxable year beginning on October 1, 1995
and ending on the Closing Date and (B) all of its net capital gains realized in
its taxable year ended September 30, 1995 and in such short taxable year (after
reduction for any capital loss carryover).
(b) Xxxxx Capital Development has timely filed all Returns required
to be filed by it and all Taxes with respect thereto have been paid, except
where the failure so to file or so to pay, would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect. Adequate
provision has been made in the financial statements of Xxxxx Capital Development
for all Taxes in respect of all periods ending on or before the date of such
financial statements, except where the failure to make such provisions would not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect. No deficiencies for any Taxes have been proposed, assessed or
asserted in writing by any taxing authority against Xxxxx Capital Development,
and no deficiency has been proposed, assessed or asserted, in writing, where
such deficiency would reasonably be expected, individually or in the aggregate,
to have a Material Adverse Effect. No waivers of the time to assess any such
Taxes are outstanding nor are any written requests for such waivers pending and
no Return of Xxxxx Capital Development is currently being or has been audited
since September 30, 1990 with respect to income taxes (and since September 30,
1992 with respect to all other Taxes) by any Federal, state, local, or foreign
Tax authority.
(c) Xxxxx Capital Development's fiscal year has not been changed for
tax purposes since September 30, 1990.
Section 3.17. Benefit and Employment Obligations. Xxxxx Capital
----------------------------------
Development has no obligation to provide any post-retirement or post-employment
benefit to any Person, including but not limited to under any Benefit Plan, and
has no obligation to provide unfunded deferred compensation or other unfunded
or self-funded benefits to any Person.
Section 3.18. Brokers. No broker, finder or similar intermediary has
-------
acted for or on behalf of Xxxxx Capital Development in connection with this
Agreement or the transactions contemplated hereby, and no broker, finder, agent
or similar intermediary is entitled to any broker's, finder's or similar fee or
other commission in connection therewith based on any agreement, arrangement or
understanding with Xxxxx Capital Development or any action taken by it.
Section 3.19. Voting Requirements; Dissenter's Rights. The
---------------------------------------
affirmative votes of a majority of the holders of the outstanding BCD Shares
(the "Required BCD Shareholder Vote") are the only votes of the holders of any
class or series of Xxxxx Capital Development's capital stock necessary to
approve this Agreement and the transactions contemplated by this Agreement. The
BCD Shareholders may not exercise dissenter's rights granted under the Wisconsin
Business Corporation Law with respect to the Reorganization.
Section 3.20. State Takeover Statutes. No state takeover statute or
-----------------------
similar Statute or regulation applies or purports to apply to the
Reorganization, this Agreement or any of the transactions contemplated by this
Agreement.
Section 3.21. Books and Records. The books and records of Xxxxx
-----------------
Capital Development reflecting, among other things, the purchase and sale of
BCD Shares by BCD Shareholders, the number of issued and outstanding shares
owned by each BCD Shareholder and the state or other jurisdiction in which such
shares were offered and sold, are complete and accurate in all material
respects.
Section 3.22. Prospectus. The current prospectus and statement of
----------
additional information for Xxxxx Capital Development as of the date on which
they were issued did not contain, and as supplemented by any supplement thereto
dated prior to or on the Closing Date, do 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 not misleading, provided, however, that
no representation or warranty is made with respect to written information
provided by AIM Equity for inclusion in the prospectus or statement of
additional information of Xxxxx Capital Development, or any supplement thereto.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF AIM EQUITY
AIM Equity represents and warrants to Xxxxx Capital Development as
follows:
Section 4.1. Incorporation: Qualification and Corporate Authority.
----------------------------------------------------
AIM Equity has been duly incorporated and is validly existing and in good
standing under the laws of Maryland, with all requisite corporate power and
authority to enter into this Agreement and perform its obligations hereunder.
Section 4.2. Binding Obligation. This Agreement has been duly
------------------
authorized, executed and delivered by AIM Equity and, assuming this Agreement
has been duly executed and delivered by Xxxxx Capital Development, constitutes
the legal, valid and binding obligation of AIM Equity, enforceable against AIM
Equity in accordance with its terms, except as the enforceability hereof may be
limited by bankruptcy, insolvency, reorganization or similar laws relating to or
affecting creditors' rights generally or by general equity principles (whether
applied in a court of law or a court of equity and including limitations on the
availability of specific performance or other equitable remedies).
Section 4.3. No Breaches or Defaults. The execution and delivery of
------------------------
this Agreement by AIM Equity and performance by AIM Equity of its obligations
hereunder have been duly authorized by all necessary corporate action on the
part of AIM Equity and (i) do not, and on the Closing Date will not, result in
any violation of the charter or by-laws of AIM Equity and (ii) does not, and on
the Closing Date will not, result in a breach of any of the terms or provisions
of, or constitute (with or without the giving of notice or the lapse of time or
both) a default under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to the loss of a material benefit under, or
result in the creation or imposition of any Lien upon any property or assets of
the Portfolio (except for such breaches or defaults or Liens that would not
reasonably be expected, individually or in the aggregate, to adversely affect
the consummation of the Reorganization) under (A) any indenture, mortgage or
loan or any other material agreement or instrument to which AIM Equity is a
party or by which it may be bound which relates to the Portfolio or to which any
properties of the Portfolio may be subject; (B)any Permit; or (C) any existing
applicable law, rule, regulation, judgment, order or decree of any Governmental
Authority having jurisdiction over AIM Equity or any of the Portfolio's
properties.
Section 4.4. Authorizations or Consents. Other than those which
--------------------------
shall have been obtained or made on or prior to the Closing Date, no
authorization or approval or other action by, and no notice to or filing with,
any Governmental Authority will be required to be obtained or made by AIM Equity
in connection with the due execution and delivery by AIM Equity of this
Agreement and the consummation by AIM Equity of the transactions contemplated
hereby.
Section 4.5. Permits. AIM Equity has in full force and effect all
-------
Permits necessary for it to conduct its business as presently conducted as it
relates to the Portfolio, and there has occurred no default under any Permit,
except for the absence of Permits and for defaults under Permits the absence or
default of which would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect. To the knowledge of AIM Equity there
are no proceedings relating to the suspension, revocation or modification of any
Permit, except for such that would not reasonably be expected, individually or
in the aggregate, to have a Material Adverse Effect.
Section 4.6. No Actions, Suits or Proceedings.
--------------------------------
(a) There is no pending action, suit or proceeding, nor, to the
knowledge of AIM Equity, has any litigation been overtly threatened in writing
or, if probable of assertion, orally, against AIM Equity before any Governmental
Authority which questions the validity or legality of this Agreement or of the
transactions contemplated hereby, or which seeks to prevent the consummation of
the transactions contemplated hereby, including the Reorganization.
(b) There are no legal, administrative or arbitration actions, suits,
or proceedings instituted or pending or, to the knowledge of AIM Equity,
threatened in writing or, if probable of assertion, orally against AIM Equity or
affecting any property, asset, interest, or right of the Portfolio, that could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect. There are not in existence on the date hereof any plea
agreements, judgments, injunctions, consents, decrees, exceptions or orders that
were entered by, filed with or issued by Governmental Authority relating to AIM
Equity's conduct of the business of the Portfolio affecting in any significant
respect the conduct of such business. AIM Equity is not, and has not been, to
the knowledge of AIM Equity, the target of any investigation by the SEC or any
state securities administrator.
Section 4.7. Ineligible Persons. Neither AIM Equity nor any
------------------
"Affiliated Person" of AIM Equity has been convicted of any felony or
misdemeanor, described in Section 9(a)(1) of the Investment Company Act, nor has
any affiliated person of AIM Equity been subject, or presently is subject, to
any disqualification that would be a basis for denial, suspension or revocation
of registration of an investment adviser under Section 203(e) of the Advisers
Act or Rule 206(4)-4(b) thereunder or of a broker-dealer under Section 15 of the
Exchange Act, or for disqualification as an investment adviser, employee,
officer or director of an investment company under Section 9 of the Investment
Company Act, and, to AIM Equity's knowledge, there is no proceeding or
investigation that is reasonably likely to become the basis for any such
disqualification, denial, suspension or revocation.
Section 4.8. Brokers. No broker, finder or similar intermediary has
-------
acted for or on behalf of AIM Equity in connection with this Agreement or the
transactions contemplated hereby, and no broker, finder, agent or similar
intermediary is entitled to any broker's, finder's or similar fee or other
commission in connection therewith based on any agreement, arrangement or
understanding with AIM Equity or any action taken by AIM Equity.
Section 4.9. Registration and Regulation. AIM Equity is registered
---------------------------
with the SEC under the Investment Company Act as an open-end, management,
series, investment company and the Portfolio has elected to qualify as a
regulated investment company under Section 851 of the Code. On the Closing Date
the Portfolio will be in compliance in all material respects with all applicable
laws, rules and regulations, including, without limitation, the Investment
Company Act, the Securities Act, the Exchange Act and all applicable state
securities laws. On the Closing Date the Portfolio will be in compliance in all
material respects with the applicable investment policies and restrictions set
forth in its registration statement currently in effect. After the Closing Date
the value of the net assets of the Portfolio will be determined using portfolio
valuation methods that comply in all material respects with the requirements of
the Investment Company Act.
Section 4.10. Registration of Portfolio Shares.
--------------------------------
(a) The authorized capital stock of AIM Equity consists of
7,000,000,000 shares with a par value of $0.001 each.
(b) The Portfolio Shares of AIM Equity to be issued pursuant to
Section 2.7 shall on the Closing Date be duly registered under the Securities
-----------
Act by a Registration Statement on Form N-14 of AIM Equity then in effect.
(c) The Portfolio Shares to be issued pursuant to Section 2.7 are
-----------
duly authorized and on the Closing Date will be validly issued and fully paid
and non-assessable and will conform in all substantial respects to the
description thereof contained in the Registration Statement on Form N-14 then in
effect. At the time of the Reorganization, the Portfolio shall not have
outstanding any warrants, options, convertible securities or any other type of
right pursuant to which any Person could acquire Portfolio Shares, except for
the right of investors to acquire Portfolio Shares at the public offering price
in the normal course of its business as an open-end diversified management
investment company operating under the Investment Company Act.
(d) The combined proxy statement/prospectus (the "Combined Proxy
Statement/Prospectus") which forms a part of AIM Equity's Registration Statement
on Form N-14 shall be furnished to Xxxxx Capital Development and BCD
Shareholders entitled to vote at the BCD Shareholders Meeting. The Combined
Proxy Statement/Prospectus and related Statement of Additional Information of
the Portfolio, when they become effective, shall conform in all material
respects to the applicable requirements of the Securities Act and the Investment
Company Act and shall not include any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not materially misleading, provided, however, that no representation or
warranty is made with respect to written information provided by Xxxxx Capital
Development for inclusion in the Combined Prospectus/Proxy Statement.
(e) The Portfolio Shares which AIM Equity intends to offer for sale
to the public after the Closing Date shall be duly registered under the
Securities Act by the AEF Registration Statement then in effect.
Section 4.11. Representations Concerning the Reorganization.
---------------------------------------------
(a) AIM Equity has no plan or intention to reacquire any of the
Portfolio Shares issued in the Reorganization, except to the extent that the
Portfolio is required by the Investment Company Act to redeem any of its shares
presented for redemption.
(b) The Portfolio has no plan or intention to sell or otherwise
dispose of any of the assets of Xxxxx Capital Development acquired in the
Reorganization, other than in the ordinary course of its business and to the
extent necessary to maintain its status as a "regulated investment company"
under the Code.
(c) Following the Reorganization, the Portfolio will continue the
"historic business" of Xxxxx Capital Development (within the meaning of Section
1.368-1(d) of the Income Tax Regulations under the Code) or use a significant
portion of Xxxxx Capital Development's historic assets in a business.
(d) Upon consummation of the Reorganization, the investment
portfolios of AIM Equity, in the aggregate, will not own ten percent of more of
the voting securities any issuer.
Section 4.12. Prospectus. The prospectus and statement of additional
----------
information for Xxxxx Capital Development that will become effective on the
Closing Date will 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 not misleading, provided, however, that no representation or
warranty is made with respect to written information provided by Xxxxx Capital
Development for inclusion in such prospectus or statement of additional
information, or any supplement thereto.
ARTICLE V
COVENANTS
Section 5.1. Conduct of Business.
-------------------
(a) From the date of this Agreement up to and including the Closing
Date (or, if earlier, the date upon which this Agreement is terminated pursuant
to Article VII), Xxxxx Capital Development shall conduct its businesses only in
-----------
the ordinary course and substantially in accordance with past practices, and
shall use its reasonable best efforts to preserve intact its business
organization and material assets and maintain the rights, franchises and
business and customer relations necessary to conduct its businesses in the
ordinary course in all material respects. Without limiting the generality of
the foregoing, Xxxxx Capital Development shall not do any of the following
without the prior written consent of AIM Equity, which consent shall not be
unreasonably withheld:
(i) split, combine or reclassify any of its capital stock or issue
or authorize the issuance of any other securities in respect of, in lieu of
or in substitution for shares of its capital stock;
(ii) amend its articles of incorporation or by-laws;
(iii) acquire or agree to acquire by merging or consolidating with,
or by purchasing a substantial portion of the assets of, or by any other
manner, any business or any corporation, partnership, joint venture,
association or other business organization or division thereof or any
assets that are material, individually or in the aggregate, to Xxxxx
Capital Development taken as a whole, except purchases of assets in the
ordinary course of business consistent with past practice, and except as
permitted under Sections 5.9 and 5.10;
------------ ----
(iv) sell, lease or otherwise dispose of any of its material
properties or assets, or mortgage or otherwise encumber or subject to any
Lien any of its material properties or assets, other than in the ordinary
course of business;
(v) incur any indebtedness for borrowed money or guarantee any
indebtedness of another Person, issue or sell any debt securities or
warrants or other rights to acquire any debt securities of Xxxxx Capital
Development, guarantee any debt securities of another Person, enter into
any "keep well" or other agreement to maintain any financial statement
condition of another Person, or enter into any arrangement having the
economic effect of any of the foregoing;
(vi) settle or compromise any income tax liability or make any
material tax election;
(vii) pay, discharge or satisfy any material claims, liabilities or
obligations (absolute, accrued, asserted or unasserted, contingent or
otherwise), other than in the ordinary course of business;
(viii) change its methods of accounting, except as required by changes
in generally accepted accounting principles as concurred in by its
independent auditors, or change its fiscal year;
(ix) make or agree to make any material severance, termination,
indemnification or similar payments except pursuant to existing agreements;
or
(x) adopt any Benefit Plan.
(b) From the date of this Agreement up to and including the Closing
Date (or, if earlier, the date upon which this Agreement is terminated pursuant
to Article VII), AIM Equity shall conduct the business of the Portfolio only in
-----------
the ordinary course and substantially in accordance with past practices, and
shall use its reasonable best efforts to preserve intact its business
organization and material assets and maintain the rights, franchises and
business and customer relations necessary to conduct the business operations of
the Portfolio in the ordinary course in all material respects.
Section 5.2. Confidentiality and Announcements.
---------------------------------
(a) As used herein, "Confidential Information" means all information,
whether oral, written or otherwise (including any information furnished prior to
the execution of this Agreement), furnished to AIM Equity, or its directors,
officers, partners, affiliates, employees, agents, advisors or representatives
(collectively "representatives") by Xxxxx Capital Development or its
representatives relating to Xxxxx Capital Development, and all reports,
analyses, compilations, studies and other materials prepared by AIM Equity or
its representatives (in whatever form maintained, whether documentary, computer
storage or otherwise) containing, reflecting or based upon, in whole or in part,
any such information or reflecting its review or view of, or interest in, Xxxxx
Capital Development, a possible transaction with Xxxxx Capital Development or
the Confidential Information. The term "Confidential Information" does not
include information which (i) is or becomes generally available to the public
other than as a result of disclosure by AIM Equity, its representatives or
anyone to whom AIM Equity or its representatives transmits any Confidential
Information, in breach of this Agreement or (ii) is or becomes known or
available to AIM Equity on a non-confidential basis from a source (other than
Xxxxx Capital Development, or its representatives) who, insofar as is known to
AIM Equity after due inquiry, is not prohibited from transmitting the
information to AIM Equity or its representatives by a contractual, legal,
fiduciary or other obligation.
(b) Subject to Section 5.2(c) below, AIM Equity and its
--------------
representatives shall keep the Confidential Information confidential and shall
not, without prior written consent of Xxxxx Capital Development disclose, in
whole or in part, and will not use, Confidential Information, directly or
indirectly, for any purpose other than in connection with evaluating the
transaction contemplated by this Agreement. Moreover, AIM Equity shall transmit
Confidential Information to its representatives only if and to the extent that
such representatives need to know the Confidential Information for the purpose
of evaluating such transaction and, prior to being furnished any Confidential
Information, are informed by AIM Equity of the confidential nature of the
Confidential Information, are provided with a copy of the provisions of this
Section 5.2 and agree to be bound hereby. In any event, AIM Equity shall be
-----------
responsible for any actions by its representatives which are not in accordance
with the provisions hereof. AIM Equity agrees that neither AIM Equity nor its
representatives will make inquires of, or conduct any discussions with, any
representative of Xxxxx Capital Development or regarding the Confidential
Information other than with the permission of Xxxxxx X. Low, Jr., Xxxxxx X.
Xxxxxxxxxx or Xxxx X. Xxxxxxxx.
(c) In the event that AIM Equity, its representatives or anyone
to whom AIM Equity or its representatives supply the Confidential Information
are requested or required to disclose any Confidential Information, AIM Equity
agrees (i) to immediately notify Xxxxx Capital Development of the existence,
terms and circumstances surrounding such a request, (ii) to consult with Xxxxx
Capital Development on the advisability of taking legally available steps to
resist or narrow the Confidential Information which, in the opinion of its
counsel, AIM Equity is legally compelled to disclose and (iii) to cooperate with
any action by Xxxxx Capital Development or to obtain an appropriate protective
order or other reliable assurance that confidential treatment will be accorded
the Confidential Information; provided, however, that this Section 5.2(c) shall
--------------
not prohibit AIM Equity or its representatives from disclosing Confidential
Information that consists of its or their own work product to persons that have
a need to know such information in the ordinary course of business.
(d) Upon termination of this Agreement pursuant to Article VII,
-----------
and promptly upon request from Xxxxx Capital Development thereafter, AIM Equity
shall redeliver to Xxxxx Capital Development or destroy all tangible
Confidential Information and any other tangible material containing, prepared on
the basis of, or reflecting any information in the Confidential Information
(whether prepared by Xxxxx Capital Development, its advisors or otherwise), and
neither AIM Equity nor its representatives will retain any copies, extracts or
other reproductions in whole or in part of such tangible material. For purposes
of this Agreement, "tangible" Confidential Information shall include, without
limitation, information contained in printed, magnetic or other tangible media,
or in information storage and retrieval systems. At the request of Xxxxx
Capital Development, compliance with the foregoing shall be certified in writing
to Xxxxx Capital Development by an authorized officer supervising the same.
(e) Notwithstanding the other provisions of this Section 5.2,
-----------
promptly following execution and delivery of this Agreement, Xxxxx Capital
Development and AIM Equity shall agree upon and release a mutually acceptable
press release and Xxxxx Capital Development shall give any and all notices
required to be given by law. Except as described in the preceding sentence and
as required by law, prior to the Closing Date, none of Xxxxx Capital
Development, AIM Equity or the parent or any affiliate of either will issue any
press release or make any other public statement with respect to this Agreement,
without the prior written consent of the other parties, which consent shall not
be unreasonably withheld.
(f) The provisions of this Section 5.2 shall terminate on the
-----------
closing of the Reorganization.
Section 5.3. Expenses. Xxxxx Capital Development and AIM Equity
--------
shall each bear their respective direct and indirect expenses incurred in
connection with this Agreement, the Reorganization and the other transactions
contemplated hereby.
Section 5.4. Further Assurances. Each of the parties hereto shall
------------------
execute such documents and other papers and perform such further acts as may be
reasonably required to carry out the provisions hereof and the transactions
contemplated hereby. Each such party shall, on or prior to the Closing Date,
use its reasonable best efforts to fulfill or obtain the fulfillment of the
conditions precedent to the consummation of the Reorganization, including the
execution and delivery of any documents, certificates, instruments or other
papers that are reasonably required for the consummation of the Reorganization.
Section 5.5. Notice of Events. AIM Equity shall give prompt notice
----------------
to Xxxxx Capital Development, and Xxxxx Capital Development shall give prompt
notice to AIM Equity, of (i) the occurrence or nonoccurrence of any event of
which to the knowledge of AIM Equity or to the knowledge of Xxxxx Capital
Development, the occurrence or non-occurrence of which would be likely to result
in any of the conditions specified in (x) in the case of AIM Equity, Sections
--------
6.1 and 6.2 or (y) in the case of Xxxxx Capital Development, Sections 6.2 and
--- --- ------------
6.3, not being satisfied so as to permit the consummation of the Reorganization
---
and (ii) any material failure on its part, or on the part of the other party
hereto of which it has knowledge, to comply with or satisfy any covenant,
condition or agreement to be complied with or satisfied by it hereunder;
provided, however, that the delivery of any notice pursuant to this Section 5.5
------------------ -----------
shall not limit or otherwise affect the remedies available hereunder to any
party.
Section 5.6. Access to Information.
---------------------
(a) Xxxxx Capital Development will, during regular business hours and
on reasonable prior notice, allow AIM Equity and its authorized representatives
reasonable access to employees, books and records of Xxxxx Capital Development;
provided, however, that any such access shall not significantly interfere with
------------------
the business or operations of Xxxxx Capital Development.
(b) Any information made available to or obtained by AIM Equity or its
authorized representatives pursuant to subsection (a) above, or otherwise in
connection with this Agreement, shall be subject to the confidentiality
provisions described in Section 5.2 above.
-----------
(c) AIM Equity will, during regular business hours and on reasonable
prior notice, allow Xxxxx Capital Development and its authorized representatives
reasonable access to the books and records of AIM Equity pertaining to the
assets of the Portfolio and to employees of AIM Equity with knowledge thereof,
provided, however, that any such access shall not significantly interfere with
------------------
the business or operations of AIM Equity.
Section 5.7. Consents, Approvals and Filings. Each of Xxxxx Capital
-------------------------------
Development and AIM Equity shall make all necessary filings, as soon as
reasonably practicable, including, without limitation, those required under the
Securities Act, the Exchange Act, the Investment Company Act and the Advisers
Act, in order to facilitate prompt consummation of the Reorganization and the
other transactions contemplated by this Agreement. In addition, each of Xxxxx
Capital Development and AIM Equity shall use its reasonable best efforts, and
shall cooperate fully with each other (i) to comply as promptly as reasonably
practicable with all requirements of Governmental Authorities applicable to the
Reorganization and the other transactions contemplated herein and (ii) to obtain
as promptly as reasonably practicable all necessary permits, orders or other
consents of Governmental Authorities and consents of all third parties necessary
for the consummation of the Reorganization and the other transactions
contemplated herein. Each of Xxxxx Capital Development and AIM Equity shall use
reasonable efforts to provide such information and communications to
Governmental Authorities as such Governmental Authorities may request.
Section 5.8. Submission of Agreement to Shareholders. Xxxxx Capital
---------------------------------------
Development shall take all action necessary in accordance with applicable law
and its articles of incorporation and by-laws to convene the BCD Shareholders
Meeting. Xxxxx Capital Development shall, through its Board of Directors,
recommend to the BCD Shareholders approval of this Agreement and the other
transactions contemplated by this Agreement, except to the extent provided in
Section 5.10 hereof. Xxxxx Capital Development shall use its reasonable best
------------
efforts to hold the BCD Shareholders Meeting as soon as practicable after the
date hereof.
Section 5.9. Acquisition Proposals. Xxxxx Capital Development shall
---------------------
not, nor shall it authorize any officer, director or employee of, or any
investment banker, attorney or other advisor or representative of Xxxxx Capital
Development to, directly or indirectly (i) solicit, initiate or encourage the
submission of any Acquisition Proposal or (ii) participate in any discussions or
negotiations regarding, or furnish to any Person any information with respect
to, or take any other action to facilitate any inquiries or the making of any
proposal that constitutes, or may reasonably be expected to lead to, any
Acquisition Proposal, and Xxxxx Capital Development shall promptly terminate any
such discussions with any Person that has expressed or expresses an interest in
acquiring Xxxxx Capital Development or negotiations pending at the date of this
Agreement provided, however, Xxxxx Capital Development or any officer, director
------------------
or employee of, or any investment banker, attorney or other adviser or
representative of Xxxxx Capital Development may, following the receipt of an
Acquisition Proposal that the Board of Directors of Xxxxx Capital Development
determines in good faith, after consultation with outside counsel, would permit
the Board of Directors to take any of the actions referred to in Section 5.10,
------------
participate in negotiations regarding such Acquisition Proposal. Xxxxx Capital
Development shall promptly notify AIM Equity, orally and in writing, of the
receipt by it after the date hereof of any Acquisition Proposal or any inquiry
from a potential acquiror of Xxxxx Capital Development which could reasonably be
expected to lead to any Acquisition Proposal, the material terms and conditions
of such Acquisition Proposal or inquiry and the identity of the Person making
any such Acquisition Proposal or inquiry, except to the extent Xxxxx Capital
Development's Board of Directors concludes, after consultation with outside
counsel, that the disclosure of any such information would be a breach of a duty
of confidentiality imposed on Xxxxx Capital Development with respect to such
information. Subject to the foregoing, Xxxxx Capital Development shall keep AIM
Equity informed of the status and details of any such Acquisition Proposal or
inquiry.
Section 5.10. Fiduciary Duties. The Board of Directors of Xxxxx
----------------
Capital Development shall not (i) withdraw or modify, or propose to withdraw or
modify, in a manner adverse to AIM Equity, its approval or recommendation of
this Agreement or the Reorganization, (ii) approve or recommend, or propose to
approve or recommend, any Acquisition Proposal or (iii) authorize Xxxxx Capital
Development to enter into any agreement with respect to any Acquisition
Proposal, unless Xxxxx Capital Development receives an Acquisition Proposal and
------
the Board of Directors of Xxxxx Capital Development determines in good faith,
after consultation with outside counsel, that in order to comply with its
fiduciary duties to the shareholders of Xxxxx Capital Development under
applicable law, the Board of Directors of Xxxxx Capital Development should
withdraw or modify its approval or recommendation of this Agreement or the
Reorganization, approve, recommend or enter into negotiations concerning such
Acquisition Proposal, or authorize Xxxxx Capital Development to enter into an
agreement with respect to such Acquisition Proposal or terminate this Agreement.
Nothing contained in this Section 5.10 shall prohibit Xxxxx Capital Development
------------
from making any disclosure to the BCD Shareholders which, in the good faith and
reasonable judgment of the Board of Directors of Xxxxx Capital Development based
on the advice of outside counsel, is required under applicable law.
Notwithstanding any provision of this Agreement to the contrary, any action by
the Board of Directors of Xxxxx Capital Development permitted by this Section
-------
5.10 shall not constitute a breach of this Agreement by Xxxxx Capital
----
Development.
Section 5.11. Section 15(f) of the 1940 Act.
-----------------------------
(a) Each of AIM Equity and Xxxxx Capital Development shall use its
reasonable best efforts to assure compliance with the conditions of
Section 15(f) of the Investment Company Act as it applies to the transactions
contemplated by this Agreement.
(a) AIM Equity shall for a period of not less than three years after
the Closing Date, use its reasonable best efforts to assure that no more than
25% of the members of the board of directors AIM Equity shall be "interested
persons" (as defined in the Investment Company Act) of the investment adviser of
Xxxxx Capital Development or any entity that served as investment advisor to
Xxxxx Capital Development or any Person that before or after the Closing Date
was or is an Affiliated Person of any of the foregoing. Without limiting the
generality of the foregoing, AIM Equity will not take, recommend or endorse any
action that would cause more than 25% of the number of members of its board of
directors to be such "interested persons."
(b) AIM Equity represents and warrants that there is no express or
implied understanding, arrangement or intention on its part to impose an "unfair
burden" within the meaning of Section 15(f) of the Investment Company Act on the
Portfolio as a result of the transactions contemplated hereby, and that for a
period of not less than two years after the Closing Date, it shall not take or
recommend any act that would constitute an "unfair burden" on the Portfolio.
Section 5.12. Sales Charges. Xxxxx Capital Development shall deliver
-------------
to AIM Equity on the Closing Date a certificate showing (a) the Remaining Amount
and Balance for Interest relating to Asset Based Sales Charges, as such terms
are used in NASD Notice to Members 93-12 at page 56, and (b) the total sales
charges, and the components thereof, paid by Xxxxx Capital Development
shareholders, collected by Xxxxx Capital Development or paid by Xxxxx Capital
Development in connection with sales of its shares since July 1, 1993.
ARTICLE VI
CONDITIONS PRECEDENT TO THE REORGANIZATION
Section 6.1. Conditions Precedent of AIM Equity. The obligation of
----------------------------------
AIM Equity to consummate the Reorganization is subject to the satisfaction, at
or prior to the Closing Date, of all of the following conditions, any one or
more of which may be waived in writing by AIM Equity.
(a) The representations and warranties of Xxxxx Capital Development
set forth in this Agreement shall be true and correct in all material respects
as of the date of this Agreement and as of the Closing Date with the same effect
as though all such representations and warranties had been made as of the
Closing Date.
(b) Xxxxx Capital Development shall have complied with and satisfied
in all material respects all agreements and all conditions set forth herein on
its part to be performed or satisfied at or prior to the Closing Date.
(c) AIM Equity shall have received at the Closing Date (i) a
certificate, dated as of the Closing Date, from an officer of Xxxxx Capital
Development on behalf of Xxxxx Capital Development, in such individual's
capacity as an officer of Xxxxx Capital Development and not as an individual, to
the effect that the conditions specified in Section 6.1(a) and (b) have been
----------------------
satisfied and (ii) a certificate, dated as of the Closing Date, from the
Secretary or Assistant Secretary of Xxxxx Capital Development certifying as to
the accuracy and completeness of the attached articles of incorporation and by-
laws, and resolutions, consents and authorizations with respect to the execution
and delivery of this Agreement and the transactions contemplated hereby.
(d) AIM Equity shall have received the signed opinion of Xxxxxxx &
Xxxxx, counsel to Xxxxx Capital Development, or other counsel reasonably
acceptable to AIM Equity, in form and substance reasonably acceptable to counsel
for AIM Equity, as to the matters set forth in Schedule 6.1(d).
---------------
Section 6.2. Mutual Conditions. The obligation of Xxxxx Capital
-----------------
Development and AIM Equity to consummate the Reorganization is subject to the
satisfaction, at or prior to the Closing Date, of all of the following further
conditions, any one or more may be waived in writing by Fund and AIM Equity, but
only if and to the extent that such waiver is mutual.
(a) All filings required to be made prior to the Closing Date with,
and all consents, approvals, permits and authorizations required to be obtained
on or prior to the Closing Date from Governmental Authorities, in connection
with the execution and delivery of this Agreement and the consummation of the
transactions contemplated herein by Xxxxx Capital Development and AIM Equity
shall have been made or obtained, as the case may be; provided, however, that
------------------
such consents, approvals, permits and authorizations may be subject to
conditions that would not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect.
(b) This Agreement, the Reorganization and related corporate matters
shall have been approved and adopted at the BCD Shareholders Meeting by the
shareholders of Xxxxx Capital Development on the record date by the Required BCD
Shareholder Vote.
(c) The assets of Xxxxx Capital Development to be acquired by the
Portfolio shall constitute at least 90% of the fair market value of the net
assets and at least 70% of the fair market value of the gross assets of Xxxxx
Capital Development immediately prior to the Reorganization. For these
purposes, assets used by Xxxxx Capital Development to pay the expenses it incurs
in connection with this Agreement and the Reorganization and to effect all
shareholder redemptions and distributions (other than regular, normal dividends
and regular, normal redemptions pursuant to the Investment Company Act, and not
in excess of the requirements of Section 852 of the Code, occurring in the
ordinary course Xxxxx Capital Development's business as an open-end diversified
management investment company) after the date of this Agreement shall be
included as assets of Xxxxx Capital Development immediately prior to the
Reorganization.
(d) No temporary restraining order, preliminary or permanent
injunction or other order issued by any Governmental Authority preventing the
consummation of the Reorganization on the Closing Date shall be in effect;
provided, however, that the party or parties invoking this condition shall use
------------------
reasonable efforts to have any such order or injunction vacated.
(e) The Registration Statement on Form N-14 filed by AIM Equity with
respect to the Portfolio Shares to be issued to BCD Shareholders in connection
with the Reorganization shall have become effective under the Securities 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 Securities Act.
(f) A post-effective amendment to the AEF Registration Statement
filed by AIM Equity to register Portfolio Shares to be offered to the public
shall have become effective under the Securities 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
Securities Act.
(g) Xxxxx Capital Development and AIM Equity shall have received on
or before the Closing Date an opinion of Xxxxxxx Xxxxx Xxxxxxx and Ingersoll in
form, scope and substance satisfactory to Xxxxx Capital Development and AIM
Equity, set forth on Schedule 6.2(g).
---------------
(h) The transactions contemplated by that certain Agreement and Plan
of Reorganization dated December 20, 1995, between Xxxxx Blue Chip Fund, Inc.
and AIM Equity acting on behalf of AIM Blue Chip Fund, and that certain
Agreement and Plan of Reorganization dated December 20, 1995 between The Xxxxx
Funds, Inc., acting on behalf of Xxxxx Quality Bond Fund, and AIM Funds Group,
acting on behalf of AIM Income Fund, shall be consummated on the Closing Date.
(i) The dividend or dividends described in the last sentence of
Section 3.16(b) shall have been declared.
(j) A I M Advisors, Inc. ("AIM") shall have executed and delivered to
Xxxxx Capital Development a certificate to the effect that:
(i) its balance sheet as of December 31, 1994 has been prepared
in accordance with generally accepted accounting principles applied on a
consistent basis and fairly reflects the financial condition of AIM as of the
date indicated; since December 31, 1994 there has not been any change in AIM's
financial condition, assets, liabilities or business that would have a material
adverse effect upon its ability to provide investment advisory services to the
Portfolio and the other funds advised by AIM (the "AIM Funds").
(ii) AIM is, and on the Closing Date shall be, registered as an
investment adviser under the Investment Advisers Act and, registered as an
investment adviser in all states where it is required to be a so
registered.
(iii) AIM is in compliance in all material respects with all
laws, rules and regulations applicable to its business of providing
investment advisory services to the Portfolio and the AIM Funds, including,
without limitation, federal and state securities laws.
(iv) Neither AIM nor any affiliated person of AIM is ineligible
to serve an employee, officer, director, member of an advisory board, investment
adviser, depositor or principal underwriter of any investment company registered
under the Investment Company Act by reason of any conviction of a felony or
misdemeanor, described in Section 9(a)(1) of the Investment Company Act, and is
not subject to any order issued by the SEC under Section 9(b) of the Investment
Company Act. To the best of AIM's knowledge, no facts exist with respect to
AIM, or any Affiliated Person of AIM, which would form a basis for any such
conviction or the issuance of any such order, judgment or decree.
(v) No litigation, proceeding or governmental investigation or
inquiry is pending or, to the best of AIM's knowledge, threatened, against
AIM that, if determined against AIM would be reasonably likely to have a
material adverse effect on the Portfolio or a material adverse effect on
AIM's ability to provide investment advisory services to the Portfolio or
any of the AIM Funds.
(k) The transactions contemplated by that certain Acquisition
Agreement dated December 20, 1995 between Xxxxxx X. Xxxxx & Co. Incorporated and
A I M Advisors, Inc. shall be consummated on the Closing Date.
Section 6.3. Conditions Precedent of Xxxxx Capital Development. The
-------------------------------------------------
obligation of Xxxxx Capital Development to consummate the Reorganization is
subject to the satisfaction, at or prior to the Closing Date, of all of the
following conditions, any one or more of which may be waived in writing by Xxxxx
Capital Development.
(a) The representations and warranties of AIM Equity on behalf of the
Portfolio set forth in this Agreement shall be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date with the
same effect as though all such representations and warranties had been made as
of the Closing Date.
(b) AIM Equity shall have complied with and satisfied in all material
respects all agreements and all conditions set forth herein on its part to be
performed or satisfied at or prior to the Closing Date.
(c) Xxxxx Capital Development shall have received on the Closing Date
(i) a certificate, dated as of the Closing Date, from an officer of AIM Equity,
in such individual's capacity as an officer of AIM Equity and not as an
individual, to the effect that the conditions specified in Section 6.3(a) and
------------------
(b) have been satisfied and (ii) a certificate, dated as of the Closing Date, of
---
AIM Equity, certifying as to the accuracy and completeness of the attached
articles of incorporation and by-laws, and resolutions, consents and
authorizations with respect to the execution and delivery of this Agreement and
the transactions contemplated hereby.
(d) Xxxxx Capital Development shall have received the signed opinion
of Xxxxxxx Xxxxx Xxxxxxx & Ingersoll, counsel to AIM Equity, or other counsel
reasonably acceptable to Xxxxx Capital Development, in form and substance
reasonably acceptable to special counsel for Xxxxx Capital Development, as to
the matters set forth on Schedule 6.3(d).
---------------
ARTICLE VII
TERMINATION OF AGREEMENT
Section 7.1. Termination.
-----------
(a) This Agreement may be terminated on or prior to the Closing Date
as follows:
(i) by mutual written consent of Xxxxx Capital Development and AIM
Equity; and
(ii) at the election of Xxxxx Capital Development or AIM Equity:
(A) if the Closing Date shall not be on or before June 30,
1996, or such later date as the parties hereto may agree
upon, unless the failure to consummate the Reorganization is
the result of a willful and material breach of this
Agreement by the party seeking to terminate this Agreement;
(B) if, upon a vote at BCD Shareholders Meeting or any
adjournment thereof, the Required BCD Shareholder Vote shall
not have been obtained as contemplated by Section 5.8; or
-----------
(C) if any Governmental Authority shall have issued an
order, decree or ruling or taken any other action
permanently enjoining, restraining or otherwise prohibiting
the Reorganization and such order, decree, ruling or other
action shall have become final and nonappealable; or
(iii) by Xxxxx Capital Development in the event Xxxxx Capital
Development receives an Acquisition Proposal and the Board of Directors of Xxxxx
Capital Development determines in good faith, after consultation with outside
counsel, that, in order to comply with its fiduciary duties to the stockholders
of Xxxxx Capital Development under applicable law, the Board of Directors of
Xxxxx Capital Development should authorize Xxxxx Capital Development to
terminate this Agreement; or
(iv) by AIM Equity 45 days following the date on which Xxxxx Capital
Development first actively participates in any discussions on negotiations
regarding, or furnishes to any Person any confidential information with respect
to, any Acquisition Proposal, unless prior to the expiration of such 45 day
period Xxxxx Capital Development notifies AIM Equity that such Acquisition
Proposal has been rejected and any such negotiations have been terminated.
(b) The termination of this Agreement shall be effectuated by the
delivery by the terminating party to the other party of a written notice of such
termination. If this Agreement so terminates, it shall become null and void and
have no further force or effect, except as provided in Section 7.2.
-----------
Section 7.2. Survival After Termination. If this Agreement is
--------------------------
terminated in accordance with Section 7.1 hereof and the transactions
-----------
contemplated hereby are not consummated, this Agreement shall become void and of
no further force and effect, except for the provisions of Section 5.2 and
-----------
Section 5.3.
-----------
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Nonsurvival of Representations and Warranties. Except
---------------------------------------------
as set forth below, none of the representations, warranties or covenants in this
Agreement or in any certificate or instrument delivered pursuant to this
Agreement shall survive the Closing Date and no party shall, therefore, have any
recourse therefor against any other party in connection therewith. This Section
-------
8.1 shall not limit any covenant or agreement of the parties which by its terms
---
contemplates performance after the Closing Date.
Section 8.2. Law Governing. This Agreement shall be construed and
-------------
interpreted according to the laws of the State of Maryland applicable to
contracts made and to be performed wholly within such state.
Section 8.3. Binding Effect, Persons Benefiting, No Assignment.
-------------------------------------------------
This Agreement shall inure to the benefit of and be binding upon the parties
hereto and the respective successors and assigns of the parties and such
Persons. Nothing in this Agreement is intended or shall be construed to confer
upon any entity or Person other than the parties hereto and their respective
successors and permitted assigns any right, remedy or claim under or by reason
of this Agreement or any part hereof. Without the prior written consent of the
parties hereto, this Agreement may not be assigned by any of the parties hereto.
Section 8.4. Obligation of AIM Equity Portfolio. Xxxxx Capital
----------------------------------
Development and AIM Equity hereby acknowledge and agree that the Portfolio is a
separate investment portfolio of AIM Equity, that AIM Equity is executing this
Agreement on behalf of the Portfolio, and that any amounts payable by AIM Equity
under or in connection with this Agreement shall be payable solely from the
revenues and assets of the Portfolio.
Section 8.5. Amendments. This Agreement may not be amended, altered
----------
or modified except by a written instrument executed by Xxxxx Capital Development
and AIM Equity.
Section 8.6. Enforcement. The parties agree irreparable damage
-----------
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any court of the United States or
any state having jurisdiction, in addition to any other remedy to which they are
entitled at law or in equity.
Section 8.7. Interpretation. When a reference is made in this
--------------
Agreement to a Section or Schedule, such reference shall be to a Section of, or
a Schedule to, this Agreement unless otherwise indicated. The table of contents
and headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement.
Whenever the words "include", "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation". Each representation and warranty contained in Article III or IV
----------- --
that relates to a general category of a subject matter shall be deemed
superseded by a specific representation and warranty relating to a subcategory
thereof to the extent of such specific representation or warranty.
Section 8.8. Counterparts. This Agreement may be executed in
------------
counterparts, each of which shall be deemed an original and each of which shall
constitute one and the same instrument.
Section 8.9. Entire Agreement; Schedules. This Agreement, including
---------------------------
the Schedules, certificates and lists referred to herein, and any documents
executed by the parties simultaneously herewith or pursuant thereto, constitute
the entire understanding and agreement of the parties hereto with respect to the
subject matter hereof and supersedes all other prior agreements and
understandings, written or oral, between the parties with respect to such
subject matter.
Section 8.10. Notices. All notices, requests, demands and other
-------
communications hereunder shall be in writing and shall he deemed to have been
duly given when delivered by hand or by overnight courier, two days after being
sent by registered mail, return receipt requested, or when sent by telecopier
(with receipt confirmed), provided, in the case of a telecopied notice, a copy
is also sent by registered mail, return receipt requested, or by courier,
addressed as follows (or to such other address as a party may designate by
notice to the other):
(a) If to AIM Equity:
AIM Equity Funds, Inc.
00 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attn: Xxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000
with a copy to:
Xxxxxxx Xxxxx Xxxxxxx & Ingersoll
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000
(b) If to Xxxxx Capital Development:
Baird Capital Development Fund, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
with a copy to:
Xxxxxxx & Xxxxx
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
XXXXX CAPITAL DEVELOPMENT FUND, INC.
By: /s/ M.C. LOW, JR.
AIM EQUITY FUNDS, INC., acting
on behalf of AIM Capital Development Fund
By: /s/ XXXXXX X. XXXXXX
Schedule 3.12(a)
LIST OF CONTRACTS AND AGREEMENTS
1. Investment Advisory Agreement dated June 25, 1984 between
Baird Growth Settlement Fund, Inc. (now named Xxxxx Capital
Development Fund, Inc.) ("BCD Fund") and Fiduciary Management,
Inc. ("FMI").
2. Amendment to Investment Advisory Agreement Dated June 21, 1986
between BCD Fund and FMI.
3. Sub-Advisory Agreement dated December 12, 1986 between BCD
Fund and Xxxxxx X. Xxxxx & Co. Incorporated ("Baird").
4. Administration Agreement dated December 19, 1988 between BCD
Fund and Baird.
5. Amended and Restated Distribution Plan of BCD Fund.
6. Distribution Agreement dated June 21, 1986 between BCD Fund
and Baird.
7. Distribution Assistance Agreement dated June 21, 1986 between
BCD Fund and Baird.
8. Custodian Agreement dated June 25, 1984 between BCD Fund and
First Wisconsin Trust Company (now named Firstar Trust Company)
("Firstar").
9. Amendment to Custodian Agreement dated June 21, 1986 between
BCD Fund and Firstar.
10.Transfer Agent Agreement dated July 20, 1990 between BCD Fund
and Firstar.
11.License Agreement dated March 31, 1987 between BCD Fund and
Baird.
12.Agreement dated September 14, 1994, as amended, among the BCD
Fund, The Baird Funds, Inc. and Baird Blue Chip Fund, Inc.
regarding allocation of fidelity bond coverage, pursuant to Rule
17g-1(f) under the Investment Company Act of 1940.
13.$1,600,000 Fidelity Bond issued by Reliance Insurance Company.
14.Articles of Incorporation of BCD Fund.
15.Bylaws of BCD Fund.
16.Order under Section 6(c) of the Investment Company Act of
1940, dated February 27, 1991, granting an exemption from
Sections 2(a)(32), 2(a)(35), 22(c) and 22(d) of the Act and Rule
22c-1 thereunder.
Schedule 6.1(d)
OPINION OF COUNSEL TO XXXXX CAPITAL DEVELOPMENT
1.Xxxxx Capital Development is a corporation duly incorporated and
validly existing under the laws of the State of Wisconsin.
2.Xxxxx Capital Development is an open-end management investment
company registered under the Investment Company Act of 1940.
3.The execution, delivery and performance of the Agreement by Xxxxx
Capital Development have been duly authorized and approved by all
requisite corporate action on the part of Xxxxx Capital
Development. The Agreement has been duly executed and delivered
by Xxxxx Capital Development and constitutes the valid and
binding obligation of Xxxxx Capital Development.
4.The BCD Shares outstanding on the date hereof have been duly
authorized and validly issued, are fully paid and are non-
assessable (subject to Wisconsin Business Corporation Law Section
180.0622(2)(b)).
5.Xxxxx Capital Development is not required to submit any notice,
report or other filing with or obtain any authorization consent
or approval from any governmental authority or self regulatory
organization prior to the consummation of the transactions
contemplated by the Agreement.
We confirm to you that to our knowledge after inquiry of each
lawyer who is the current primary contact for Xxxxx Capital Development or who
has devoted substantive attention on behalf of Xxxxx Capital Development during
the preceding twelve months and who is still currently employed by or is
currently a member of this firm, no litigation or governmental proceeding is
pending or threatened in writing against Xxxxx Capital Development (i) with
respect to the Agreement or (ii) which involves in excess of $500,000 in
damages.
Schedule 6.2(g)
Tax Opinions.
-------------
(i) The transfer of the assets of Xxxxx Capital Development
to the Portfolio in exchange for the Portfolio Shares distributed directly
to the BCD Shareholders, as provided in the Agreement, will constitute a
"reorganization" within the meaning of Section 368(a) of the Code and that
Xxxxx Capital Development and AIM Equity will each be a "party to a
reorganization" within the meaning of 368(b) of the Code.
(ii) In accordance with Section 361(a) and Section 361(c)(1)
of the Code, no gain or loss will be recognized by Xxxxx Capital
Development as a result of such transaction.
(iii) In accordance with Section 1032 of the Code, no gain or
loss will be recognized by the Portfolio upon the receipt of assets of
Xxxxx Capital Development in exchange for Portfolio Shares issued directly
to the BCD Shareholders
(iv) In accordance with Section 354(a)(1) of the Code, no
gain or loss will be recognized by BCD Shareholders on issuance by AIM
Equity of Portfolio Shares in exchange for their BCD Shares.
(v) In accordance with Section 362(b) of the Code, the basis
to the Portfolio of the assets of Xxxxx Capital Development transferred to
it will be the same as the basis of such assets in the hands of Xxxxx
Capital Development immediately prior to the exchange.
(vi) In accordance with Section 358(a) of the Code, a BCD
Shareholder's basis for Portfolio Shares issued to such BCD Shareholder
pursuant to Section 2.7 of the Agreement ("Issued Shares") will be the same
-----------
as his basis for BCD Shares.
(vii) In accordance with Section 1223(1) of the Code, a BCD
Shareholder's holding period for Portfolio Shares will be determined by
including said BCD Shareholder's holding period for BCD Shares exchanged
therefor, provided that BCD Shareholder held such BCD Shares as a capital
asset.
(viii) In accordance with Section 1223(2) of the Code, the
holding period with respect to the assets of Xxxxx Capital Development
transferred to the Portfolio will include the holding period for such
assets in the hands of Xxxxx Capital Development.
(ix) In accordance with Section 381(a)(2) of the Code, the
Portfolio will succeed to and take into account the items of Xxxxx Capital
Development described in Section 381(c) of the Code, subject to the
conditions and limitations specified in Sections 381 through 384 of the
Code and the Internal Revenue Service regulations thereunder.
Schedule 6.3(d)
OPINION OF COUNSEL TO AIM EQUITY
1.AIM Equity is a corporation duly incorporated and validly existing
under the laws of the State of Maryland.
2.AIM Equity is an open-end, management investment company
registered under the Investment Company Act of 1940.
3.The execution, delivery and performance of the Agreement by AIM
Equity have been duly authorized and approved by all requisite
corporate action on the part of AIM Equity. The Agreement has
been duly executed and delivered by AIM Equity and constitutes
the valid and binding obligation of the Portfolio.
4.The Portfolio Shares outstanding on the date hereof have been duly
authorized and validly issued, are fully paid and are non-
assessable.
5.AIM Equity is not required to submit any notice, report or other
filing with or obtain any authorization consent or approval from
any governmental authority or self regulatory organization prior
to the consummation of the transactions contemplated by the
Agreement.
We confirm to you that to our knowledge after inquiry of each lawyer
who is the current primary contact for AIM Equity or who has devoted substantive
attention on behalf of AIM Equity during the preceding twelve months and who is
still currently employed by or is currently a member of this firm, no litigation
or governmental proceeding is pending or threatened in writing against the
Portfolio (i) with respect to the Agreement or (ii) which involves in excess of
$500,000 in damages.